Most Russians I encounter hold some strong views about illegal immigration. As Mexicans pick our tomatoes, Uzbeks, Tajiks, and other Central Asians work their construction sites and supply other low-wage labor. One interpretation of this situation is that they do a mediocre job for cheap, thus degrading the quality of Russian life and taking jobs away from citizens.
Our situation in America is rather different, regardless of editorial spin. The government does not hire Mexican farm workers, and few would argue that their work is inferior. Disgruntled Americans focus on the notion that they are keeping wages low and unemployment up.
As I discussed in my last post, this interpretation has been complicated by evidence that unemployed Americans do not accept farm labor when it is available. It is more profitable, and more reliable, to simply collect unemployment insurance. This does not seem quite right.
So I've been thinking about what the economy would look like without undocumented immigrants. For the sake of simplicity, I'll focus on agricultural labor. Here is my take: an intuitive, thought-experiment economic analysis.
*Farm wages rise. Compensation needs to be more attractive than unemployment insurance.
*Without government assistance, many farms are unable to afford the new cost of labor and go out of business. Alternatively, the government provides subsidies to aid this transition.
*American food prices rise, reflecting the high cost of labor and scarcity of domestic farms.
*Cheap food from abroad fills American markets. Food "Made in America" is now a luxury.
*Most Americans end up eating food grown in Mexico, picked by the same Mexicans who used to work here.
The demand for domestic food will never go away, but in such a scenario, it would shift to the rich and the xenophobic. Because of undocumented immigrant labor, most Americans can afford food that is grown on our soil. Without Mexican workers, some more Americans might have jobs, but they wouldn't be able to afford a tomato picked north of the border.
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