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June 27, 2013
Just say no to flooding the US markets with new workers
Posted by Laura
My friend the economist Jim Pethokoukis's latest handiwork "Why the US might need those Mexican high-school dropouts" deserves a serious response. He goes through an analysis of various economic data and birthrates to conclude that more legal immigration is critical to country's economic future (although he ends his argument with a caveat).

OK, so let's think about this.

We currently have 23 million households in the United States on food stamps.

We have an unemployment rate of 7.6 percent -- but even that rate is too low because it doesn't count all the folks who have left the job market.

In May, there were 11.8 million unemployed persons in the United States, and 4.4 million of those have been unemployed for 27 weeks or more:

That report also says that 7.9 million people were working part time, but wanted to work full time. Another 2.2 million people wanted work, and were available for work, but were not counted as unemployed because they hadn't searched for work in the last 4 weeks. (1.4 million of those people are doing things like going to school or dealing with family responsibilities, but 780,000 of them are "discouraged workers" who believe no jobs are available for them).

So we have 11.8 million unemployed persons, 7.9 million part-time workers who want to work full time, and 780,000 people who have given up. By my count, that's 20,480,000 people who would like to have a full time job.

Meanwhile, the average American worker is terrified of losing his or her job, and works incredibly hard as a result. The typical American worker gets only 16 days of paid vacation and holidays -- but doesn't take them all. In the typical year, Americans are entitled to 175 million vacation days that they do not take.

Oh, and by the way, the average U.S. household has regained just 45 percent of wealth that it lost during the recession.

Oh, and U.S. GDP growth in Q1 2013 was only 1.8 percent, instead of the 2.4 percent figure that had been previously announced.

And on top of all this, the CBO reports that for years to come, the new immigration bill will lower the average wage and increase the unemployment rate.

Yet despite all of this evident misery, Jim Pethokoukis is afraid that we might have a shortage of workers?

Here's my proposal to Jim Pethokoukis. Let's not pass a bill that CBO says will make things worse for the average American. Let's test your theory and see if we end up with a shortage of workers. If that happens, as Thomas Sowell pointed out, U.S. workers should be able to negotiate much better deals for themselves. Let's see if that really happens. In fact, let's see if:

--The unemployment rate falls below 5 percent
--Almost everyone is able to get off of food stamps
--The average American household is actually wealthier than it was before the recession
--We're able to eliminate much of our government spending on welfare
--The average American is able to take 3-4 weeks of vacation a year without worrying about whether he'll lose his job

And then -- when almost every American is doing great, except for a small number who refuse to work hard or participate in the economy -- THEN I will gladly agree to raise the number of immigrants into the country.

But until that happens, I'm going to spend more time worrying about the actual economic pain and misery being experienced by Americans in the real world, than about the theoretical possibility that some folks might have difficulty finding workers in an imaginary future world.
06/27/13 7:13 AM
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