American Dream lives in hearts of immigrants.

[joemurphy]

Probably the hottest issue of this election campaign will be immigration. While illegal immigration will get most attention, some politicians clearly would like to see less of the legal variety as well.

My intention here is to focus on the economics of immigration. But my views on the subject are not neutral. I am the son of an immigrant who arrived in this country in 1925 at age 15 and couldn't speak a word of English. No doubt some people back then would have wondered whether a Hungarian speaker could ever become "really American," would have pointed out the costs my father imposed because he went to public school at taxpayer expense, and then would have argued that he "took" some American's job when he left school at 17 to work in a textile factory.

These kinds of charges are of course leveled today at Hispanic immigrants -- most of whom are here legally -- as they have been leveled at immigrants to this country since the 1790s. But immigration has been a source of tremendous economic vitality. The argument that Hispanic immigrants are "different" also was made against German, Italian, Jewish, Chinese and just about every other ethnicity you can name.

The charge has always been wrong, and is wrong with regard to Hispanic immigrants. The facts show that third-generation Hispanic Americans are English-speaking, upwardly mobile and significant creators of economic activity. Severely curtailing immigration today would be as wrongheaded an idea now as ever.

If anything, we should expand legal immigration, especially of skilled, educated individuals. Of course, realistically, we can't truly open immigration; clearly we would be overwhelmed. Illegal immigration, meanwhile, raises a question apart from the economic value of immigrants in American society, namely the rule of law. But there should be ways to curtail illegal immigration without building walls and setting guards at arm's length from the Gulf of Mexico to the Pacific Ocean.

There are two main economic claims against immigration: First, it is said, "They're taking our jobs." But this belief is based on a common misconception called the "lump of labor" fallacy that maintains there's just so much work to go around. So if an immigrant "takes" an American's job, that American is left unemployable. But in reality the amount of work expands to meet the demands of consumers and the opportunities of producers. Though people claim immigrants are taking jobs, we've had net gains of millions of jobs over the past decade.

Some studies do indicate that unskilled immigrants (legal and illegal) in fact may reduce wages for unskilled U.S. workers. The wage reduction may be as much as 8 percent although other studies have suggested it's negligible.

But there are two points to keep in mind: First, most unskilled immigrants compete with other immigrants, not native-born Americans. Second, is the solution for unskilled high school dropouts that we close the borders so that they get a job for $6.10 an hour instead of $6 an hour? Or should we make a better effort to train all citizens to do the higher-valued work that's in demand?

The other economic claim is the immigrants are a net burden on social services, and there are a few studies that seem to prove the case. But invariably those studies are flawed. To paraphrase one expert, immigrants are supposedly costing the rest of us $10 billion per year, but we'd be kidding ourselves if we thought that government would have an extra $10 billion if all immigrants left tomorrow. The studies, for example, calculate the money immigrants cost public services, but they ignore many of the taxes (such as sales taxes) they pay as well as the overall benefits of increased economic activity.

Moreover, there are urgent long-term issues these studies ignore. With a relatively low birth rate in this country, immigrants are one hope we have for maintaining the integrity of Social Security and Medicare. According to the Social Security Administration, immigrants (legal and illegal) will make a net contribution to the system of $216 billion over the next 75 years.

Generally, we should not be thinking of the barriers we can erect but rather the opportunities we can offer. In 1927 my father may have "taken" an American's job, but 30 years later, he was employing 15 other Americans in a small business. It's called the American Dream; it lives in the hearts of most of our immigrants as it did in his.

Peter Z. Grossman.

Dr. Grossman is the Efoymson Professor of Economics at Butler University.

[rzemanfl]

1. And is dying in the hearts of people who were born and raised

here.