It’s the Law, Stupid

The N&O reported last week that the N.C. Center for Public Policy Research (have you seen their website?) will be releasing a report that claims that illegal immigrants are one of the keys to solving North Carolina’s “looming worker shortage.”

What shortage?

North Carolina’s unemployment rate has increased three months in a row.

As of March 2008, 234,086 workers were unemployed in North Carolina. This number does not include thousands of working-age residents who are not counted as part of the civilian labor force because they are not looking for a full-time job. Many of these people would go back to work full-time if offered a suitable opportunity. Shouldn’t we find jobs for these people before we hand over their jobs to illegal aliens?

Moreover, economic historians have repeatedly found that during those periods when the U.S. labor supply contracted -– such as after the passage of the Immigration Act of 1924 –- tight labor markets stimulated capital investment and operating efficiencies that raised productivity by 40 percent.

This is not to say that the retirement of the baby boomers won’t put tremendous pressure on our economy and society. It will. But what should the solution be? Illegally importing millions of low-skilled laborers? This is a recipe for disaster, to say the least because low-skilled immigrants pay less in taxes than they use in services.

Or, encouraging investment (by cutting the capital gains tax) and the state income tax and encouraging the legal immigration of high-skilled workers? Of course, if we really have a labor shortage, the best policy is to “grow” our own labor by: 1) training legal workers who are already here; and 2) making abortion illegal again.

What is most important here is that a strong economy must be based on the rule of law. Thus, this issue should not be framed as a zero-sum game between breaking the law and preserving the economy. We can choose both: to obey the law and to enact a labor policy that will better serve our economy.

Economic solutions based on breaking the law are short-sighted and just plain stupid. If we want to grow the economy, let’s start by obeying the law.