7 Responses to “Why immigration is hard to tackle”

Comments

1. Willem Buiter: I have to declare an interest in the subject of immigration. I am an immigrant (born in the Netherlands), and so are my wife (USA), my son (Peru) and my daughter (Bolivia). We have currently 8 operational passports between the four of us (two British, two Dutch and four American). Even our two cats are foreign breeds – Maine Coon and Norwegian forest cat. Only the newts in our garden pond are truly British (I think).

   I feel about nationalities/citizenship and passports the way I feel about underwear: always carry plenty of it, and change it regularly. Nationality has never been a constraint on what I have been able to do. I served as an external member of the Monetary Policy Committee of the Bank of England before I became a British citizen. I became Chair of the Netherlands Council of Economics Advisers when I no longer had Dutch citizenship.

   From a normative point of view, I am with Philippe Legrain who believes that freedom of movement is a human right. Libertarian political instincts combine with religious convictions: “The earth is the LORD’s, and the fullness thereof; the world, and they that dwell therein”. Not: Britain for the British or Scotland for the Scots, or even British jobs for British workers. I do not recognise national property rights as such.

   I disagree with Martin when he says that a country is not just a set of institutions, but also a home, and that people have a right to decide who enters their (collective) home. I view a country as a club with a set of institutions and membership rules. The rules cannot be different for those born in the country (or related through kinship to people born in or resident in the country) than for those contemplating emigrating to that country. Anyone who is willing to abide by the membership rules has the right to join. Anyone also has the right to leave and to join any other club.

   Under certain circumstances, exit taxes may be appropriate. These are, however, easily abused for opportunistic political ends, or to abrogate the right to leave. It is clear that, despite remittances and the prospect of eventual return to the country of origin, certain forms of emigration (a brain drain, the departure of qualified doctors and nurses, the exit of the most dynamic and youthful age cohorts) can do serious damage to the rights of those left behind. Whether compensation is due from the emigrant or from the government of the destination country is an interesting question.

   Citizenship in my view is purely residence-based, and residence is a personal choice. It clearly makes sense, to avoid certain obvious free-rider problems, to link entitlement to some of the benefits of citizenship in a country to the duration of one’s residence there and/or to the magnitude of the contributions in cash (taxes) or in kind (compulsory military service, jury duty) one has made to the country.

   I disagree with Mr. Legrain as regards some of his positive or factual statements about the consequences of immigration on the native population. There are certainly plenty of instances where these effects can be negative. Unskilled immigration into the UK may well bring in labour that is complementary to the labour of native skilled workers; it is likely to lower the wages of native unskilled workers, or to displace them altogether if wages are rigid downwards.

   When immigrants are different from natives in appearance or speech, the diversity they bring can as easily become a problem as a benefit. On the Isle of Dogs, where I lived for many years, the old native population, working class white Englanders left behind and marginalised when the docks left, co-existed badly with the large Bangladeshi immigrant community. The resulting resentment let to the first election of a BNP Councillor in a local election (in the ward where I lived, Millwall, in 1993). The two communities are brought together only by their shared dislike of the affluent yuppies that are the most recent immigrants into the area.

   This is a huge topic and there are many lose ends. A key question for the ‘countries as open clubs’ view concerns the kind of membership rules that are legitimate. Clearly a rule for citizenship in a country that reproduced the BNP’s party membership requirement – restricting it “indigenous British ethnic groups deriving from the class of ‘Indigenous Caucasian’” - would not be my cup of tea. I would begin by accepting only those clubs as legitimate whose membership rules (in theory and practice) respect the 1948 Universal Declaration of Human Rights. Beyond that, as long as immigrants impose no adverse rights externalities on natives (that is, as long as they do not infringe these same human rights), they should have the right to settle in the country. Absence of negative rights externalities is compatible with negative conventional externalities (adverse effects on the standard of living of natives, for instance). So it would not be an argument against immigration that it makes (some or even all) natives worse off.

   If this policy were adopted by the EU, this could mean that, say, 150 million people might be queuing up to escape the low-lying areas of the Indian subcontinent and move to western Europe. In addition to great cultural gains and economic benefits for some of the natives (European landlords and those native European workers with skills complementary to those of the newcomers), this would no doubt also create massive disruption, congestion, overcrowding, urban decay and growth of shanty towns in parts of Western Europe, and to drastic declines in the standards of living of native European workers whose skills are rival with those of the immigrants. The immigrants themselves would on average be significantly better off, or they would not choose to come.

   My position that the wellbeing and rights of actual and potential immigrants count neither more nor less than those of the native-born is of course not exactly the brick with which the house of modern nationhood is built. In the UK, as in the Netherlands and the US, vile and virulent anti-foreigner and anti-immigrant sentiment is never far from the surface. The pages of most of the UK tabloids drip with poison when they address immigration-related matters. The flames of xenophobia, racism, anti-foreigner hysteria and anti-immigrant psychosis are also regularly fanned by opportunistic politicians from both government and opposition, oblivious of the damage they do to the social fabric Large-scale immigration has often provoked communal violence, and at times enduring civil conflict (as in Northern Ireland).

   Peaceful coexistence and mutual tolerance among diverse communities, and a significant degree of integration and assimilation are necessary for a ‘country as an open club’ to thrive. The British and Dutch models of multiculturalism, which have encouraged ethnic and religious apartheid, have failed. Something closer to the original American melting pot model is more likely to be successful.

   Despite all the shock and horror about the UK immigration numbers (and yes, it is a scandal that the data are so poor), the scale of recent immigration into the UK (4.8 million gross and 1.6 million net over the last 10 years according to the (unreliable) official figures) has certainly been manageable from the point of view of the natives. The net immigration of about 2.1 million expected between 2006 and 2016 also looks manageable, although it will exacerbate pressure on certain key scarce resources (housing, transportation infrastructure, health and education). We will have to pay somewhat higher taxes to provide the necessary infrastructure and public goods and services

   Immigration has made London the most interesting, diverse, exciting and creative city in the world. It may no longer be an English city, in anything except a geographical sense, but it is the first true ‘worldcity’ or global city – an open city which belongs to the people of the world. This is no doubt why the enemies of the open society, including the suicide bombers that have targeted it and may to so again, hate it so much. Those who don’t like what immigration has done and will continue to do to London or who feel threatened by it can always move somewhere else in the European Union.

   Posted by: Willem H. Buiter | November 2nd, 2007 at 4:16 pm | Report this comment
   

2. Martin Wolf: I much appreciate Willem’s long comment on my column, but I disagree with him on a number of points, as I also disagree with my friend Philippe Legrain. I will focus here on where I disagree with Willem. So it may be assumed that I agree with Willem on points I do not discuss (e.g. on exit taxes for skilled migrants from poor countries and on the need to restrict the rights of migrants to access welfare benefits).

   I, too, should state my interest. I am the child of two refugees from Hitler (as I have noted in previous writings). If they had not been fortunate enough to have been accepted into the UK, they would probably have perished during the war. That is certainly true of my mother, but not so obviously true of my father, who would probably have gone to Palestine with the rest of his immediate family. (Incidentally, my mother came from the Netherlands and was born in Amsterdam. So I share something else with Willem.)

   In any case, if my parents had not come to the UK, I would not exist. For this reason, I think of myself as having loyalty to Britain (or, if the UK is broken up, England), a concept Willem would presumably condemn. My parents had no doubt that to be naturalised meant identifying with the culture of the country that had become their own and encouraging their children to identify in the same way. I share that belief.

   Interestingly, Willem quotes in support of his position the psalmist’s line: “The earth is the Lord’s, and the fullness thereof.” The words come from the Hebrew Bible, that is, from my own religious tradition. Willem will note the irony: the idea that the earth was the Lord’s was deemed by the Hebrews to be entirely compatible with the notion that God’s people enjoyed special rights to the land of Israel. Indeed, the psalmist – assumed to be King David – was a notable warrior against those who sought to conquer his country.

   Yes, I argue that a country is a home and that its people have a right to decide who enters that home, as any home-owner does. For the majority of people, there is emotional attachment to the country in which they live. Moreover, from time to time, they may be required to fight for the independence of their country. I consider that a natural and often an admirable instinct. Without it, the liberal values Willem admires might not have survived the 20th century. I believe people are prepared to fight for their homes, but not for a club or, for the most part, even for an abstract ideology of freedom. Presumably, Willem does not care about any of that.

   Yet let us accept, for the purposes of argument, that a country might indeed be a club. The difference, Willem argues, from my concept of a country as home is that people should have a right to join any county-as-club whose rules they accept.

   This raises three objections to my mind.

   First, clubs frequently reject applicants as unsuitable even though the latter claim to be willing to abide by the rules. Clubs are not normally committed to accepting the children of their members, as countries are. Clubs can expel members if they break the rules, which countries cannot usually do. (Or does Willem believe they should be allowed to do so?) What Willem has invented here then is neither a country nor a club. It is an open-access society that cannot determine its own membership. My view is that such an entity is not a country (or, for that matter, a club) at all.

   Second, as Edmund Burke famously put it, society “is a contract between the living, the dead and those who are yet to be born”. That sounds metaphysical. But it is a statement about the role of history in determining the shape of both the present and future. We are not merely interchangeable individuals. We all possess specific cultural characteristics, which come from our own past and that of our families. A human without a culture is not a human being at all. Membership of a society then is always historically determined. One may be permitted to enter into the social contract. But that, in my view, is a privilege, not a right.

   Third, even if we did accept Willem’s idea that society is a club that anybody should be able to join, we have to decide both what its rules are and how they are to be implemented. So let us accept, for the moment, that anybody who wishes to join and accepts the rules should be entitled to do so. Let us accept that those rules should also be compatible with the 1948 Universal Declaration of Human Rights.

   The question then is precisely the one Willem raises, but does not answer: what does one do if one has reason to believe that some of the applicants have views that are incompatible with the continued peaceful enjoyment of their accustomed rights by present and future citizens (including their own progeny)?

   I would be inclined to argue that anybody who believes, on religious grounds, in the legal or political inferiority of women or that an allegedly sacred text trumps a democratically elected parliament would not be a welcome member of any country-club that I lived in. Nor, more to the point, would I want my children, grand-children, great-grand-children and so forth to do so. Willem would agree, I believe, but, if so, what would he do about it?

   These are not idle fears. Already in Canada there is a strong movement to permit Shari’a courts to govern Muslim family matters. Already in the UK there is a move towards the extension of faith-schools that is bound to lead to a profound segmentation of the population. Already we have restrictions on our right to provoke so-called “religious hatred” that represent a significant abridgement of freedom of speech. So what would happen in a world of unrestricted migration? Willem cannot know, not least because he has no idea where the immigrants would come from or what their numbers would be.

   Now let me turn to the economic and social consequences of the unrestricted immigration that Willem approves of. Here he and I largely agree. The consequences for the existing residents of a high-income country, such as the UK, are likely to be far more mixed than Philippe Legrain admits.

   Yet I find Willem’s position internally inconsistent. He says, as I do, that free migration might lead to “massive disruption, congestion, overcrowding, urban decay and growth of shanty towns in parts of Western Europe”. Yet he also condemns those concerned about such consequences as fanning the flames of “xenophobia, racism, anti-foreigner hysteria and anti-immigrant psychosis”. I agree that a community of saints would not have such reactions. I presume that is the moral standard he sets. But it seems to me to be an unrealistically high one.

   His position on this also seems anti-democratic. Voters are bound to prefer their own interests and those of their families over those of humanity in general. But he insists that “the well-being and rights of actual and potential immigrants count neither more nor less than the native born” (my emphasis). If that is to happen, the voters must surely be replaced by some philosopher king.

   Willem says that “We will have to pay somewhat higher taxes to provide the necessary infrastructure and public goods and services” to support the immigrants.” For the numbers hitherto, that is quite manageable. But he has no notion of what the costs would be if immigration were unrestricted, because he has no idea what the numbers would be. Would it be, say, more than 200m over a century? Would it be more, or less? Why should people “have to” pay for this?

   As Willem notes, large-scale migration – or, more generally, the mixing up of different ethnic groups has frequently led to communal violence and at times enduring civil conflict. Maybe, this is not a decisive argument against free immigration. But it is a legitimate concern. He agrees, too, that Dutch and British multiculturalism has not worked, because they have encouraged a form of apartheid. I agree. He suggests that the American melting pot is a better model. By and large, I agree on that, too.

   Yet he does not confront the question whether all societies are equally able to become a successful melting pot. Geography matters: the US is a continent. History matters even more: the US is a manufactured country, with founding documents and a proven ability to turn immigrants into citizens. More precisely, it is “creedal”. Being a good American means, in the end, accepting the American creed.

   Neither the UK nor the Netherlands have these characteristics. They are evolved nation-states. One does not become British merely by accepting certain ideas or even certain institutions. One must, in my view, internalise a certain history, even though it is not the history of one’s own ancestors. This is a tricky thing to do. (I know: it is my own condition.) I know that many Americans would argue that theirs is the only model. But I doubt whether it is a feasible model for most European countries.

   In sum, it is perfectly reasonable – or at least perfectly natural - for residents of a rich country to fear the consequences of unrestricted immigration for them and their loved ones. It is certainly important for those of us who are unlikely to be adversely affected by even much higher levels of immigration to be honest about this.

   What would I feel if my children had been in a class in which, say, 80 per cent of the pupils did not have English as their first language? I would have pulled them out. I did put them into private education. It would be grossly hypocritical of me to condemn those who do not have this choice for being concerned about the implications of the situation for their children’s future success.

   So where does this leave us? My view is that freedom of movement across the planet is not a universal right. I have suggested that Willem’s idea of a “club” does not get round the difficulties, since clubs generally have a right to determine who can join. Even if one eliminates such a right, there is still the big question of what the rules should be and how to decide who wants to live by them.

   I also do not believe one can say in the same breath that unrestricted immigration might have dire consequences for many people and that those who are worried about just that are xenophobes and racists. Indeed, I believe these epithets are used far too often to silence those who have legitimate concerns. I think it is quite disgraceful that the government has had a de facto policy of liberal immigration which it has not sought to justify in any intellectually coherent way, while condemning anybody who questions it as a “racist”. This is the politics of the bully-boy. The government has not even bothered to count the immigrants. No wonder many people have become suspicious of its intentions.

   I agree with Willem that it is perfectly logical to insist that migration should be free even if it would have harmful consequences for many, or even all, citizens. The motto then is “fiat justitia et pereat mundus” (let justice be done even though the world perishes). But I not hold such an absolutist view. I think it is reasonable for people to seek to protect those few, well-functioning liberal societies, even if it is at the price of restricting entry. I believe that it will be necessary to manage immigration if that is to be achieved.

   None of that implies that migration should be halted, far from it. I am sure that continued immigration is highly desirable. I believe the UK was right to open the country to the so-called “Accession 8″ after these countries’ entry into the European Union. In the long run, however, I believe it will be impossible to preserve the open society Willem and I love if controls on migration are not made effective. And I am prepared to support such controls, for this reason.

   Posted by: Martin Wolf | November 4th, 2007 at 5:31 pm | Report this comment
   

3. Jakob Weizsäcker (Guest): It is certainly true that more potential migrants are interested in coming to rich countries than the rich countries are willing to absorb. As Martin Wolf has made plausible, rich countries would most likely wish to retain some restrictions on immigration even in the absence of xenophobia.

   This immediately leads to the question of how scarce immigration slots should be allocated. One method would be to simply sell the available immigration cards to the highest bidders. Such pricing of a scarce resource is the standard answer of economists to all sorts of allocation problems. There is little doubt that Martin Wolf has this in mind when he asserts: “we should certainly move to market-compatible systems, such as auctions of work permits, rather than arbitrary point systems.” However, I strongly disagree with his dismissal of the points system as a basis for a rational immigration policy.

   Clearly, countries would not want to charge the same (auction) price for all types of immigrants. There are good reasons for this. For moral reasons, refugees should be let in for free. For fiscal reasons, countries want to give immigrants who are likely to become large net contributors to the public purse a discount, let them in for free, or even give them special tax breaks as is current practice in the UK. For social reasons and for ease of integration, migrants with a good knowledge of the local language or exceptional talent even if the market value of this talent is comparatively low (e.g. a PhD in Assyriology) may also be let in at a discount or for free.

   Once one accepts the idea that countries care about individual characteristics of immigrants beyond the migrant’s (or employer’s) willingness to pay for entry, it is only natural to introduce a point system: Points are allocated to potential migrants according to the morally, fiscally, or otherwise desirable characteristics. These points are then summed up and potential immigrants above a certain points threshold are allowed to enter (for free).

   With the current somewhat haphazard collection of special immigration schemes in the UK, it is likely that many deserving migrants are falling through the bureaucratic cracks. By merging these special schemes into a single points system, that risk can be substantially reduced while increasing transparency at the same time. As far as I know, this is essentially what the UK government is proposing to do. It would certainly make good sense.

   Having established that point systems do have an important role to play in immigration policy, the question then becomes: Might immigration price signals, possibly through auctions, also be usefully employed in addition to a points system. The short answer is yes.

   A traditional points system simply defines the subset of potential immigrants who should be let in for an entry price of nought. This somewhat degenerate pricing scheme could easily be extended into the range of positive prices by auctioning a limited number of additional points to potential migrants who are still short of the threshold by a couple of points. The extra revenue from the auction points could then be used to address some of the adverse effects of immigration.

   However, the scope for the pricing of permits may be limited by problems such as adverse selection: for example, the sale of immigration permits might disproportionately attract criminals or, much more innocently, people with an expensive medical condition desperately trying to move to a country that offers free treatment. Or it may not, or there perhaps there are clever ways to counter the problem.

   What should we take away from this? Moving to points based immigration scheme makes sense. There are good reasons for it conceptually and point systems have successfully used in Canada and Australia for many years. Once such a points system has been introduced, one should also run experiments with pricing schemes. But at this stage, I think one ought to be careful not to over-promise on what these pricing schemes may be able to deliver.

   Jakob Weizsäcker is a resident scholar at Bruegel, a Brussels-based think tank

   Posted by: Jakob Weizsäcker | November 5th, 2007 at 5:55 pm | Report this comment
   

4. Alan Winters: Martin Wolf is correct that we ought to start a debate about immigration and Willem Buiter that the starting point is whether we should control immigration at all. My heart is with Willem but my head is with Martin. I agree with virtually all of Martin’s response to Willem but am surprised that he did not make more of the pragmatic economics of running a society with open borders. (Yes, I know, the British are a nation of shop-keepers.)

   In addition to Martin’s argument for exclusion on the grounds of hostility to the prevailing liberal order, I would argue that unrestricted entry would either destroy all incentive to acquiesce in the payment of taxes for public services and/or lead to a police state. The case applies to genuine public goods – e.g. contagious disease or congestion. Why pay for the infrastructure to support 100 million people if doing so just reduces congestion costs sufficiently to attract a further 20 million who push the cost for residents back up to where it was? Why stockpile 100 million flu vaccines if that just encourages another 20 million people to come and require one.

   But the case also applies to quasi-public goods like schools. We could privatise them all, but then what do we do about people who choose not to educate their children – some form of compulsion? If we keep some public provision, how do we prevent huge levels of overcrowding, for if we don’t, who would support school-building and staffing if his or her family could expect to receive next to no benefit from it? The answer would have to be control of access – e.g. via catchment areas. But then we would need to prevent the growth of shanty towns in school areas – not just the gerrymandering of catchment areas to preserve middle-class privilege, but around almost any school. We would all end up living in gated communities! Trying to manage such a society seems almost bound to lead to the erosion of the implicit social contract that binds most people within the borders of the nation and of the rights that Willem correctly takes so seriously.

   It is true that we don’t know how many people would cross a perfectly open border, but given the population of the developing world and the income gains people could make by moving, they seem quite large enough to mandate some sort of management of entry.

   Posted by: Alan Winter | November 6th, 2007 at 3:16 pm | Report this comment
   

5. Tito Boeri: I agree with Martin that national jurisdictions have the right to regulate migration. Migration flows tend to occur in waves and migration flows put gradualism in this process, allowing countries to absorb the new comers. But Martin misses the key point, which is one of enforcement. As suggested by the experience in the diversion of migration flows after the Eastern Enlargement, such restrictions can only be enforced via coordination at the supranational level. We need more Europe in this context, not less.

   I am not too excited about the auctions or other “market-based solutions” suggested by Martin as neither the market nor the relevant actors are well defined in this context. But the key point is enforcement. Whatever the restrictions we want to adopt it should be enforced and there is no way a single state of the EU can govern this process by itself. Our national public opinions should be educated about this simple truth.

   Posted by: Tito Boeri | November 8th, 2007 at 2:09 pm | Report this comment
   

6. Stephen Cecchetti: I have been thinking about immigration off and on for at least a decade. Martin and Willem’s well-reasoned comments clearly move the debate forward. Here are a few reactions:

   1) I don’t see a path to a philosophically compelling answer that fits
   all cases — there is no Platonic ideal, no set of immigration principles
   that can be derived from some sort of fundamental axiomatic system. This means that any debate on immigration is destined to hit a point where the logic is intractable. There
   is, however, one simple principle that we should all accept: Every person
   has the right to citizenship somewhere.

   2) That said, I believe that every country is entitled to its own rules, for better or worse. I don’t have to like the rules, but I don’t have to live in the country. Martin wants a country to be like a family in a house; Willem wants a somewhat broader association, calling it a club. I would choose a somewhat different analogy: that a country is like a university or school, with entrance requirements and the right of expulsion. Importantly, in the same way that there are selective universities and open-enrollment colleges, countries can chose their own rules.

   3) That said, I have at least one American perspective: The country where I live was founded as refuge for the people who were either persecuted elsewhere for what they believed, or those that were not given sufficient opportunity to prosper where they were born. We are a country of immigrants, and it has always seemed to me that we should take anyone who can get here. I’m sure my own circumstance forms the basis for this belief. While I was born in California, my mother fled German persecution in 1937 and my father escaped Italian post-WWII rural poverty in 1948. Obviously, if we had open borders we would need to make adjustments to how social services are provided to non-citizens. Willem addresses these in his persuasive comments about the need to avoid certain free rider problems. Fleshing out his proposals is, in my view, where the American version of the debate should be focused. If others elsewhere wish to adopt different rules, so be it.

   Posted by: Stephen G. Cecchetti | November 8th, 2007 at 3:39 pm | Report this comment
   

7. Martin Wolf: I want to thank all those who participated in this discussion on one of the most philosophically and politically difficult of all policy questions. What is involved here is not just economics, but also deeper questions. How is a country to be defined? Do people have a right to define who they share a state with? Are there even any general answers to such questions?

   Anyway, let me respond so some of the challenges made to my positions in both the original post and my response to Willem’s important contribution.

   First, if we accept that there needs to be some control over immigration, how should it be exercised? I assume there will continue to be policies for asylum and for family reunification. This leaves the questions of other rights to residence and work permits. I suggest that these be auctioned to the highest bidder, foreign or domestic, and be valid for a pre-determined period. That implies a quantitative limit. But I would have no great problem with the idea of selling permits at a predetermined price, instead, which would allow the quantity to respond to supply and demand.

   The logic of charging a price is three-fold: first, those who value the permits most would buy it; second, the citizens of the country have made a passport very valuable over a lengthy period and, in this way, would recoup some of their collective investment; and, third, the price would defray some of the expenses associated with the entry of someone into a congested country (more technically, would internalise some of the externalities).

   Jacob Weizsaecker wishes to combine some form of pricing with a points system. His idea is that the latter could be used to pre-qualify applicants. I have no problem with starting this way. I can understand that there might be some advantage in pre-qualifying some candidates: obtaining a good degree in a British university, for example, suggests that the candidate would fit in well and possess requisite intellectual skills.

   Johannes Koettl of the World Bank has also criticised my proposals for auctioning work permits and proposes what he calls “ demand-driven systems that link the UK labour markets directly with immigration policies.” I do not know what he has in mind. Perhaps he could post on this forum, to explain. But my proposal would link the markets at home and abroad directly, since the price of the permits would indicate the value to workers and employers of movement into the labour market from abroad. The government could respond to higher than envisage prices by issuing more permits or it could offer a limitless number of permits at a pre-set price.

   I would also like to respond to three further points that Mr Koettle makes. I presume that the price for the permits would be the marginal price. If 100,000 permits were available, everybody would pay the price offered for the last one. So the aim would not be to extract all the surplus value, as Mr Koettl fears. I also do not assume that the auction price must be paid up front. It would be possible to pay out of earnings in the UK. Finally, I do think there is an advantage in bringing in skilled rather than unskilled workers. I am not persuaded that the gains to the UK of depressing wages of the domestic unskilled, with relatively liberal immigration, are large, given the adverse social by-products.

   Now let me turn to a second issue: enforcement. This is a huge issue, as Tito Boeri notes. If immigration controls cannot be enforced, there is no point in discussing the issue at all. I agree fully that controls must be exercised at the European level, at least for countries that are part of the agreement on free internal movement (the UK is not). But the question remains how. I believe there must be two elements. The first is a system for monitoring entry and exit into the country. The second is some form of document that an employer must be able to check before he (or she) offers a job.

   So an entitlement to work must take the form of a document that is hard to forge. Is it impossible to produce such a document? Then employers who offered jobs to people without such a document would be subject to heavy penalties. I do fear, however, that checking the right of people to work may require either a universal identity card or a universal requirement to possess a passport. If we are not prepared to contemplate such measures, then it is clear that controls on immigration would be impossible. So there really would be nothing to discuss.

   Stephen Cecchetti raises a third big issue: national sovereignty. Obviously, I believe countries have a right to control immigration, because the right to determine the composition of the population is a core aspect of sovereignty. But, as Stephen notes, different countries can – and probably should – make different choices, which reflect what they are. The US, like other countries of immigration (Australia, Canada and New Zealand come to mind), is going to make different choices from Japan, at the opposite extreme. These divergences are simply inevitable. All human societies are not the same.

   Now let me consider a fourth question: how to make what Willem Buiter calls a “club” or Stephen an institution like a university, with rules of entry and expulsion, work. Both seem to suggest that a solution to the problem of citizens or immigrants who do not accept the rules of the country is banishment. The Athenians even had an anonymous ballot on banishment.

   Personally, I would quite like to start with the people who argue - all seriousness, it appears - that the position of Muslims in the UK today is somehow similar to that of the Jews in Hitler’s Germany! I would move on to those who argue that murdering one’s fellow citizens at random is a legitimate reaction to disagreement with a foreign policy decided by a democratically elected government. How can one live safely alongside people who not only suffer from, but expound, such offensive and self-serving delusions?

   Yet one thing seems clear: it is really hard to expel people from a country. What would we do if nowhere would take them or the countries that would do so are highly likely to abuse them. So let me repeat: countries are really not like clubs, with an effective right of expulsion of those who have already made themselves at home. They are communities of destiny, which is why the right of access is a precious privilege.

   A fifth big issue is raised by Alan Winters: how does one restrict access to public goods and semi-public goods, such as schools and hospitals? His point is telling. It would be impossible to do so, even if it would be possible to restrict access to individualised benefits, such as pensions, housing subsidies or unemployment benefit. Consider an obvious example: ten million people enter, to which the country responds by facilitating development of new housing, schools, hospitals, roads, etc. Then another ten million enter. And so forth.

   The truth is that it would be impossible to sustain the living standards of most citizens of a rich country in a world of completely free immigration. The rich would presumably move into gated communities of some kind. The poor would be forced to fend for themselves. Everywhere might come to look a bit like today’s Brazil. Try to sell that to any electorate! It could only be “sold” by using intellectually disreputable arguments (confusion of aggregate national income with incomes per head, for example) or by stealth, which is, of course, exactly how it has been sold in the UK.

   I would like to add one final point. Am I inconsistent in believing in free trade, but not completely free movement of people? I believe the answer is: no. My belief in free trade does not derive from pure libertarian principle. I think it is mutually enriching.

   So what are the points, I would make here? First, trade theory assumes the existence of countries with defined populations. Without that assumption, countries become something more like mere local jurisdictions. Second, the great beauty of market relations, at a distance, is that we do not have to agree with those with whom we transact on anything beyond the rules of the transactions themselves. This is a superb way to cope with differences. In a country, however, we also have to agree on the basic rules of political and social life. Physical proximity transforms the relationship, which immediately becomes much more demanding. Finally, there are a range of powerful externalities that increase with proximity: demands upon public goods; demands on welfare services; and demands on resources. To put it simply, having Guangdong in China does not affect us in the way that it would if it were to move to Yorkshire.

   For all these reasons, I would argue that the decision on migration is not the same as on free trade. That does not mean one cannot make the argument for free movement. People I like and respect do. But they have to make additional arguments in doing so.

   In the end, the point is simple: an immigrant is not just a machine for doing work; he (or she) is a human being, with a culture, aspirations, demands for services, a desire to have a family and so forth. All this is exactly as it should be. But it also means that treating immigration as if it were just the same as free trade is, in my view, plainly wrong. (By the way, for similar reasons, I do accept that the decision to accept foreign direct investment is also more profound than the decision to trade freely.)

   Thanks for the debate. I look forward to more on this huge topic.

   Posted by: Martin Wolf | November 14th, 2007 at 12:30 pm | Report this comment
   

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