Prominent Economist Says Cuts in U.S. Immigration Threaten U.S. Economy and Innovation   

Austan Goolsbee, a professor of economics at the University of Chicago’s Booth School of Business and a former adviser to President Barack Obama, asserts, “The long-run health of the United States economy is in serious danger from a self-inflicted wound: the Trump administration’s big cuts in immigration.” [1]

First, he cites last year’s 70 percent decline in immigration to only 200,000 people, a principal cause of which was the Trump Administration’s “restrictions as well as the unwelcoming tone set by the president himself,” which will be exacerbated by its reduction of this year’s refugee quota to 30,000.

Second, Goolsbee says, “The impact of low immigration on the American economy will be profoundly negative, both now and in the future.”

He explains that the “growth rate of the economy comes from two parts: income growth per capita and population growth.” (Emphasis added.) However, the U.S. and other advanced economies are experiencing declining birthrates and aging populations. “The only way the United States [so far] has avoided the demographic pressure facing other rich countries is through immigration.”

“Without sustained immigration, [U.S.] economic growth will be notably slower.” Moreover, “lower immigration portends big problems because the basic American retirement system — Social Security and Medicare — relies on workers to pay for retirees, and the entire expansion of the work force over the next 15 years will come from immigration. Lower immigration rates will mean serious funding shortfalls for older Americans.”

Moreover, “evidence increasingly says having immigrants here makes workers born in the United States more successful.” These “immigrants start companies at twice the rate of native Americans.” There also is evidence that immigrants help foster innovation. “The essence of knowledge work is building on others’ ideas, and having fewer creative people from different backgrounds in the United States undermined the entire enterprise” under U.S. immigration laws of the 1920s that “were designed to block the entry of immigrants from Southern and Eastern Europe and from Asia in order to preserve the ethnic ‘character’ of the United States.”

In short: “Making outsiders feel unwelcome, blocking asylum seekers or putting their children in cages may succeed in reducing the flow of immigration to the United States. But the American economy will suffer.”

Conclusion

This article provides additional evidence for this blog’s  consistent argument about the U.S. need for more immigrants. [2]

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[1] Goolsbee, Sharp Cuts in Immigration Threaten U.S. Economy and Innovation, N.Y. Times (Oct. 11, 2019).

[2] See, e.g., these posts to dwkcommentaries.com: More Warnings of the Problems Facing U.S. Aging, Declining Population (Aug. 14, 2019); Another Report About U.S. Need for More Immigrants (Aug. 25, 2019); Minnesota’s Challenges of Declining, Aging Population (Oct. 2, 2019); Worthington’s Mayor Defends City (Oct. 3, 2019).