http://www.latimes.com/news/columnists/la-fi-golden15dec15,1,6449165.column?coll=la-news-columns
MICHAEL HILTZIK / GOLDEN STATE
The Truth About Illegal Immigrants
Michael Hiltzik
Golden State

December 15, 2005

No issue jerks the knees of Californians — indeed, all Americans — as
much as illegal immigration and its effect on the state and the nation.
One reason that it tends to elicit pre-programmed responses across the
political spectrum is that the information available on the subject has
traditionally been of two kinds: bad and nonexistent.

The slack is normally taken up by cant and supposition: Illegal
immigrants take jobs from native workers, drive down or hold down wages,
impose a uniquely heavy cost on society and so on. For the most part,
these are perceptions masquerading as conclusions, which is not to say
that they should be lightly dismissed. They drive the politics of
immigration, after all, and thus influence the prospects of immigration
reform.

So it's encouraging that a panel of state economic officials and other
leaders is about to receive a dose of actual facts about illegal
immigration and its effect on the state. The instrument is a report
prepared by the Center for the Continuing Study of the California
Economy, an independent think tank in Palo Alto, which will be presented
today in Sacramento to the state's Economic Strategy Panel. This
15-member group is appointed by the governor and legislative leaders and
chaired by Victoria L. Bradshaw, secretary of the state labor and
workforce development agency.

What's important about the report is that by deflating numerous myths
about illegal immigration it underscores the genuine issues and points
us toward the best policies to address them. Chief among its findings is
this: Immigration, legal or illegal, while imposing net fiscal costs on
this state, produces a net economic benefit for the country.

The imbalance between national economic gains and local fiscal costs
reminds us that the federal government's evasion of its responsibility
to help states and municipalities with the staggering costs of hosting
illegal immigrants — especially in the education, healthcare and
criminal justice systems — is inexcusable. There has always been an
abstract recognition of this responsibility in Washington, but until
federal lawmakers understand that the nation genuinely benefits from
immigrant labor, it will always remain abstract. (In other words,
underfunded.)

The center's report is not a brief for illegal immigration. "As an
economist, I have nothing to say about the argument that 'illegal is
illegal,' " Steven Levy, the center's director, told me this week. On
the other hand, he says, the report "repudiates that there are wide
pockets of poverty and imbalance in the California economy due to
immigrants. They're fitting in."

The study focuses largely on the California economy since 1990. The date
is significant because it marks the beginning of the illegal immigration
flood tide; just over half the state's legal immigrants arrived before
1990, but about 86% of the 2.4 million illegal immigrants living in the
state today have arrived since then. (They're currently arriving at a
net rate of 75,000 to 100,000 a year, mostly from Mexico and other Latin
American countries.)

The researchers looked at several economic trends in that period. They
found that California unemployment, which was as much as 3% higher than
the national rate during and after the recession of the early 1990s,
largely closed the gap after 1994. By this year, it was nearly identical
to its rate in 1990.

Average wage levels in the state, in contrast with those in the nation,
have soared. In 1990, the report says, the average wage was 10.9% above
the national average. By 2004 it had moved to 13.4% above the average.
Meanwhile, job growth has remained strong — exceeding the national rate
from 1994 to 2000 and pacing it since then.

Clearly, California has remained an impressive economic engine
throughout the period of heavy illegal immigration. It's worth noting
that the period includes two major economic setbacks — the
aerospace-driven recession of the early 1990s in Southern California and
the 2000 tech bust in the Bay Area — without which California might well
have had the rest of the country eating its economic dust. Of course,
neither bust can be remotely traceable to immigration.

What about whether illegal immigrants are displacing native-born
Americans in the job force? The arriving workers are concentrated in a
few low-wage sectors — although they comprise 4.3% of the U.S.
workforce, in 2004 they held 19% of jobs in farming, 17% in cleaning and
11% to 12% in food preparation and construction.

But there's no evidence that they've increased native unemployment or
significantly suppressed wages in those trades. A 1997 study by the
National Academy of Sciences cited by the new report found only a "weak
relationship" between the number of immigrants and native wages. A
report this year by the president's Council of Economic Advisors placed
the effect at less than 1% in wages for every 10% increase in the number
of immigrant workers. In any event, California's minimum wage ($6.75 an
hour) sets a floor on how much an unskilled worker can be paid.

The virtue of the center's analysis is that, unlike most other surveys,
it's not a snapshot of immigration's near-term effect. It shows that, on
average, immigrants rise on the socioeconomic scale the longer they're
in the country, as do subsequent generations. The more successful they
are, of course, the better it is for the general economy.

Implicitly, this calls for a realistic immigration policy — not
necessarily a full amnesty for those who came here illegally, but some
recognition that their presence sets the groundwork for a fuller
contribution to the economy, such as a guest worker program with the
promise of a green card under certain circumstances — very like the Bush
administration's proposed temporary worker program, but perhaps more
generous.

In the long run, won't that be more profitable than trying to corral
them all and ship them home, only to wonder once they're gone how to
fill the jobs they were doing while they were here?