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BR Research

The ideological wall

Thinking about moving to the land of opportunities? Sorry, the doors are closing in on that dream.
Published February 22, 2017

Thinking about moving to the land of opportunities? Sorry, the doors are closing in on that dream. The growing belief that the free movement of people and goods is not safe- either economically or because of national security- is increasingly becoming central to political campaigns across the western world. With the election of Donald Trump as the 45th President of the United States- and given that building a wall and tackling illegal immigration were a major thrust of his campaign- it is no surprise that merely 10 days in office, he already imposed a travel ban on seven Muslim-majority countries. The ban has been stayed, but its impact has been felt far and wide.

The truth is, history comes full circle. Some argue that Trumps White House could very easily lead to the rebirth of so-called Nativism, a movement that reared its head in the US in the 1850s shutting out foreigners considered inferior in some ways.

In fact, the first significant US federal legislation restricting immigration was the 1882 Chinese Exclusion Act, which banned Chinese laborers from coming to America because of fears that they would lower wages and make it harder to organize unions. The Immigration Act of 1917 was later passed that banned immigrants from a massive region that included Saudi Arabia, most of China, as well as countries in South Asia and South East Asia.

Nearly a century later, the current anti-immigration rhetoric feels like a long echo. In a chilling article, Financial Times called it nativist paranoia. Since refugees (and Muslims) already have a certain image in the world (that many progressives are unsuccessfully fighting), these stereotypes make it less outrageous to start with them, but this seems merely a prequel to the actual narrative.

President Trump has vowed from the beginning to reform the immigration system by introducing, what he calls "extreme vetting", but which will likely be a means to reduce the influx of legal immigrants. In late 2016, projections by Pew Research Center suggested that Trumps plans would reduce legal immigration by at least 30 million.

Cue a recent bill that proposed to cut the number of immigrants admitted in 2015 in half. The senator leading the bill argued that higher legal immigration in recent decades had led to a sharp decline in wages for working Americans. This also remains a major reason cited by Trump supporters for voting for him- that immigrants took away working class jobs, and affected their wages by working for less.

But academics are wary. The National Academies of Sciences, Engineering and Medicine found little to no negative effects on overall wages and employment of native-born workers in the longer term while a University of Pennsylvania study found that immigrants, whether high- or low-skilled, legal or illegal, [were] unlikely to replace native-born workers. The former study argued that high-skilled immigrants spurred innovation, helped create jobs and had a positive impact on skilled and working class Americans.

Interestingly, working class immigrants are not the only problem to the new administration. Many Republican senators, lawmakers and advisors to Trump have long harbored ill-feelings toward the H1B visa granted to people in specialty occupations. In fact, Steve Bannon, the new White House Chief strategist, considers them dangerous. Bannon who has a direct ear to the President and is deeply influential in the administration called legal immigration the beating heart of the problem and has been outspoken against high-skilled foreigners working in the US.

In an earlier interview, he argued that students from South Asia and East Asia came to study engineering, IT and other technical sciences from top American schools and ultimately took jobs that should be for Americans. Interestingly, Americas education exports amounts to $35 billion, 5 percent of the total national exports. If there are restrictions on study visas, it would certainly put a dent to exports in the long term. The Trump administration seems ready to bear that loss.

Some may argue that the checks and balances within the US government ensure that each branch- Executive, Legislative and Judicial- is accountable; and cannot sanction anything unconstitutional. Days after the 7-country travel ban was ordered, a court blocked the order and later a circuit court decided to uphold this courts decision.

This could be construed as a win for those opposing Trump but with a Republican Senate, there is more power to the ideals held high by the Trump administration. Indeed, some other executive draft orders leaked to the Washington Post point toward a palpable and strong reshaping of the way immigration will be tackled going forward. These orders will aim at controlling who enters the country and regulate the workforce through the immigrant and nonimmigrant visa programs.

Meanwhile, studies suggest that if legal immigration went down, it would reduce the younger part of the population which constitutes majority of the workforce and would affect the economys expansion. A Brookings Institution demographer William Frey contends: ..you are making the population older, the elderly dependence ratio higher, and reducing the labor forces productivity.

Even so, academic studies can be open to debate. Whats not debatable is that America is no longer Kennedys nation of immigrants, or Reagans shinning city upon a hill that others looked up to. Americans today are up in arms fighting for their version of what greatness looks like. Who will be the victor and who none the wiser, we here are most curious to find out.


Copyright Business Recorder, 2017

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