Wednesday, June 27, 2007

The REAL Problem with the Immigration Bill

As we all know the immigration bill is back, and (in my opinion) will pass the Senate. I had deep concerns when this bill first surfaced over its impact on the labor market.

Essentially the bill would take the demand mechanism away from business and give it to government. It would make government the clearing house for workers under a point system. The system will fail because government cannot possibly sort through the price signals which make up the labor market. Neither can business. They can only do it for their market for which they specialize, which is why the system works so well. It is not possible for a central bureaucracy to sort these issues out.

My concerns were confirmed today here. Apparently Canada has a similar points system and it is cramping the labor market. Huge surprise! Labor shortages in blue collar jobs (especially the fast growing oil sector) and long waiting lines (backlog of 800,000 applications with a wait of four years or more).

Everybody is so scared of Mexicans, while I'm scared of the government.

1 comment:

BillT said...

I, for one, don't fear Mexicans. I'm very concerned with the idea that Tamil Tigers, Hamas, Al Queda and several other terrorist groups (See the series in the San Antonio Express) can exploit a pourous border.

You make an excellent point on demand, however, and one we shouldn't ignore. More open access to U.S. markets (free of government interference), including labor markets and equivalent U.S. access to foreign markets is ideal.

We could also point out that this labor issue is due largely to the issues of a desperate need for tort reform (It's nearly impossible to can anyone for anything anymore) and over-regulation of the labor market.

Reform isn't likely to occur in a government running with the Kennedy line on immigration or anything else, for that matter.