Seeking Immigration's Middle Ground

Seeking the Middle Ground for Creation of a U.S. Policy on Undocumented Workers -- The challenge of cutting through emotions and altering the paradigm, reported by The Communications Institute. Creation of a new guest worker program could capture the benefits of the vital low-skilled workforce represented by the influx of undocumented people into the U.S. That appeared to be the consensus among about 65 leaders of government, business, immigration and public policy groups, and educational and philanthropic organizations. They gathered at Arizona State University’s downtown Phoenix campus on Dec. 11, 2007 for the forum, “Immigration: Confronting the Challenges in Arizona,” sponsored by the Thomas R. Brown Foundations, The Communications Institute, and Arizona State University. Support for a guest worker program became more vocal with each session (Costs and Benefits of Immigration; Evaluating the Impact of Immigration Policy Choices; and Options for the Future), as acting moderators John E. Cox, Jr., President of The Communications Institute, Dennis Hoffman, Ph.D., Director of the W. P. Carey School of Business at ASU, and Timothy S. Bee, President of the Arizona State Senate (R-District 30), challenged participants to focus on finding a “common sense middle ground,” to rise above emotions and the polemics of the polarized political battleground, and to try to outline firm ideas on which a pragmatic and practical immigration policy could move forward. On the road to consensus, however, there also was plenty of disagreement – both in philosophy and policy approaches. On one hand, a staunch law and order advocate, supported by a mix of some government officials and law enforcement officers, criticized undocumented workers for making their first act in the United States (crossing the border without proper papers) an illegal one. In another vein, panelist William Beach, Director of the Center for Data Analysis of The Heritage Foundation, spoke to the inalienable right of the U.S. to define and enforce its borders – and its unquestionable authority to determine who gets in and who doesn’t. On the other hand, a mix of some economists, lawmakers, and business representatives, pointed to humanitarian concerns and the vital role immigrants (legal and illegal) play in filling gaps for lower skilled workers in the U.S. labor force. Dan Griswold, Director of the Center for Trade Policies, The Cato Institute, acknowledged that no one in the room was likely to be comfortable with wide-scale illegal immigration, but the benefit of these workers is clear, he said, and Mexico has the supply, while the U.S. has the need. “You can demonize these immigrants in a few words – criminals, aliens, amnesty, and all that – but it’s so difficult to do the hard work of drafting a compromise,” he said. Extensive research on the economic impact of undocumented workers was presented, much of it aimed at showing how their very presence helps create economic growth not possible without them and even contributing to lower housing prices by virtue of their participation in the construction industry. Participants differed sharply, however, on whether undocumented workers and their families represent a net drain or net gain for the U.S. economy. Several participants pointed to the irony of the federal (and, in some cases, state) government accruing most of the benefits, such as more revenue, while local governments struggle to shoulder the lions’ share of increased costs for immigrants’ services, education and, pertaining to criminals, incarceration. Repeatedly, experts around the room sounded cautions related to research -- not all studies are created equal. Judy Gans, Program Manager, Immigration Policy, Udall Center for Studies in Public Policy at the University of Arizona, said she finds greater value in looking at the numbers of immigrants, rather than percentages. Her 2007 study, “Immigrants in Arizona: Fiscal and Economic Impacts,” served as the catalyst for much of the discussion on the fiscal impact of undocumented workers. “You’ll see a lot of statistics on things like the percentage of immigrants who are uninsured compared to native born,” she said. “It’s true that maybe more immigrants are uninsured, but what we want to know is not the percentage of immigrants who are uninsured. We want to know the percentage of uninsured who are immigrants.” “I’m very happy that Ms. Gans mentioned that when we do studies, the assumptions and extrapolations can twist things. I would add to that the operational definitions. Look at benefits. Many of the studies look only at illegal immigrants. They don’t look at the children of illegal immigrants, who are legal citizens, but nevertheless, a drain on our economy – and they wouldn’t be here if their illegal parents were not here. Look at our access program. Look at our ESL program. We’re bleeding money because of this problem in Arizona,” asserted John Kavanagh, Arizona State Representative (R-District 8), who supported Arizona’s tough new employer sanctions law for workplace immigration enforcement, which takes effect Jan. 1. (The thorny issue of the economic impact of undocumented workers will be discussed at greater length below.)  Let's take a look at some key issues in the discussions.  Undocumented Workers: Measuring the Size and Extent of the Population Determining how many immigrants are in the U.S. illegally is imprecise, although Hoffman noted, popular media and various studies ballpark the figure around 579,000 in Arizona (and between 10 to 12 percent of the workforce) and 11 to 12 million nationwide. Gans, who sees the U.S. Census as a valuable data source on this concern, noted that illegal immigrants are a highly mobile, fluid population, further complicating the task of counting them. Dawn McLaren, Research Economist, JP Morgan Chase Economic Outlook Center, W.P. Carey School of Business, Arizona State University, said another complexity is that, while U.S. Census data is a good starting point, it is subject to the interpretations of the various research organizations that apply those numbers to their unique policy considerations. “For me, when you’re looking at the undocumented, I think the U.S. Center for Immigration Studies (USCIS) has a methodology that works fairly well and they’ve started to produce numbers ever year,” said McLaren. Even with the tacit acknowledgement that a quantitative measure of undocumented workers can be elusive, participants were even more at odds about the duration of stay of undocumented workers. Alberto Olivas, Director of Voter Education and Outreach, Maricopa Community Colleges, sought to dispel the notion that most Mexicans want to become permanent residents – noting that some Americans are drawing those conclusions based on fear. “I want to refute what a few people said – that immigrants are quite happy living and working here. That’s not really true,” he said. “Mexican immigrants live and work here because it’s something to be endured out of necessity. But most Latin American people find this culture here very cold and unfriendly and hard to endure. It’s unbearable. They don’t want their children to grow up here, but that’s the fact we have imposed upon them by the way we have enforced our immigration policies and made it harder for people to go back and forth.” Other participants noted, to the contrary, that Mexican immigrants have embraced American culture, becoming adept at speaking English, and understanding the economic need to do so if they are to be successful. Several participants urged a more humanitarian view to counteract the hatred that has become increasingly evident in local grassroots protests against illegal immigrants, and not just in Arizona. “We need to get back to pre-9/11 and talk about our economy and talk about our sister nation and talk about the ebb and flow of workers – and get away from the hatred. The hatred is going to ruin this country,” Maricopa County Supervisor Mary Rose Garrido Wilcox, said solemnly. “The shining light of America is not the shining light it used to be,” said Manuel Ruiz, Supervisor, Santa Cruz County, District 1. “It’s a human issue. It’s how we treat each other as human beings. How do we make it better for everyone? We have always been a country that has pushed for human dignity, human rights across the globe, and now we’re turning our back to the plight of a lot of people trying to better their lives.” The Honorable Carlos Flores, Consul General, Mexican General Consulate, and Pete Rios, Arizona State Representative (D-District 23) sought to impress upon the group the deep, traditional values of the Mexican people, honoring family and religion, a strong work ethnic and a sense of community. Economic Impact of Undocumented Workers When Hoffman posed the questions: Why are we observing so many undocumented workers in the state of Arizona? What is their motivating factor for coming here? McLaren had a ready response and substantial documentation. They are coming here for jobs, she said, a conclusion supported by her analysis of leading economic indicators which unexpectedly revealed a rise in apprehensions at the border immediately preceding periods of upturn in the U.S. economy. It’s not that there is a shortage of jobs in Mexico. “They are happy to be here in what we call low-wage, low-skilled jobs because they’re looking at a difference in the wage they would be earning at home and what they can earn here,” McLaren explained. Even when U.S. companies locate in Mexico, offering jobs, they still do not break out of the wage differential that has wages comparatively lower in Mexico than in the U.S. Economic desperation piques their interest in U.S. employment, but McLaren says the dysfunctional nature of U.S. immigration bureaucracy and enforcement causes them to become “illegals.” “It can take sometimes 15, maybe up to 20 years for (U.S. officials) to even look at a visa application,” she said. “We’ve set up a system of bureaucracy that’s impossible to deal with. Why don’t they come here legally? Well, because there isn’t a way to do it. Is it ethical to come here illegally? That’s a whole different question.” Once undocumented workers do arrive, many after enduring life-threatening conditions to get here, they fill an important gap in the U.S. labor force, says Gans. Her study, “Immigrants in Arizona: Fiscal and Economic Impacts,” is available by clicking here. The research finds that immigrant workers (both naturalized and non-citizens) contributed about $2.4 billion to Arizona revenue in fiscal 2004, while extracting costs of $1.4 billion, for a positive net impact of approximately $940 million. (The study measures the incremental costs of immigrants as individuals and does not include the costs of social services, such as fire and public safety, which were deemed impossible to measure specifically for immigrants.) At the forum, Gans presented slides from the study that pointed to several interesting conclusions. First, a substantial amount of the growth that has occurred in Arizona’s working age population from 1990 to 2000 was due to the foreign born population. “Without these workers, Arizona’s workforce would be significantly smaller in number,” Gans noted. The research also provided support for the frequent observation that undocumented workers dominate low-skilled labor markets, including agriculture, construction, service industries and manufacturing, and gave a glimpse at why this is so. “Even though immigrants in Arizona are roughly 12 percent of the overall population (and 14 percent of Arizona’s labor force), they are 55 percent of those with less than a high school education,” she said. By contrast, 14 percent of native born residents had less than a high school education, but 60 percent had at least some college. “Immigrants are filling vital gaps in the labor force in the low-skilled sector and that makes them vital to industries that we’re all aware of: construction, agriculture, service industries. And, in Arizona, a surprise to me was that immigrants are very important in manufacturing, as one of the largest sectors in Arizona,” Gans said. Several business leaders provided anecdotal context and support for Gans’ research findings from their own experiences. “When it comes to the foreign born worker in agriculture, who else is willing to work 12 hours a day, if needed, seven days a week? Who’s willing to work outside in the hot sun? Who’s willing to work outside when it’s 20 degrees for a few hours?” asked Dick Walden, President and CEO of Farmers Investment Company and a large-scale pecan grower. Another participant added that not only does the U.S. lack a large labor pool of low-skilled workers, the native born tend to lack vital generational knowledge – such as in the 1930s when 30 percent of the population was involved in agriculture and everyone’s grandfather passed along the knowledge of how to raise livestock, farm crops and repair tractors. Forum participants struggled with whether it was feasible to substitute domestic employees for the low-skilled foreign born, perhaps by raising pay rates? But, Jason LeVecke, business owner, and Glenn Hamer, President and CEO of the Arizona Chamber of Commerce and Industry, both pointed to the current “full employment” economy in Arizona with the unemployment rate below 4 percent. “This is not a question of jobs being ripped from American citizens,” said Hamer, “this is a question of needed labor supply. The federal government must make some adjustments in this area to ensure an adequate program that allows employers to legally bring in workers.” His remarks seemed to lay the foundation for the forum participants’ later discussion of the importance of a guest worker program. LeVecke, CEO of MJKL Enterprises, which runs 52 Carl's Jr. franchises, said the tightness of the low-skilled labor market is a constant challenge, despite his organization’s higher-than-minimum wage pay. “I have managers almost on a daily basis calling and saying they just lost two employees and they have no applications. I have really nobody in all of my restaurants making minimum wage. It is absolutely not a question of pay. I have some stores that have an average rate in those stores of over $10 an hour. So it’s not a matter of us just paying more. We pay more if we have to. But when there are no applications and you’re offering more, that’s what I can testify to,” he said. How many visas would be needed to fill the low-skilled labor force needs of the U.S., if all undocumented workers agreed to leave the U.S. and were able to efficiently apply for visas to return legally? That was a question posed by Barry Goldwater, Jr., President of B2 Solutions, and U.S. Congressman from 1969-1983, of panelist Bill Beach. “We would need two and a half million visas per year,” noted Beach. “Every person who is working in the U.S. is adding value to the economy. And, because we’re operating at full employment, you can’t find enough U.S. workers to fill those slots. So, if you’re devising a visa program, your target should ultimately be a mix of temporary workers, guest workers, ag workers, and on and on, with all of the 30 visas to total around 2.5 million.” The demand for, and labor mobility of, low-skilled workers is a global phenomenon, prompting migration patterns around the world that are similar to those occurring in Arizona, Gans said. Is a Guest Worker Program the Answer? Two sharply contrasting views on this question were represented by the responses of Dan Griswold of The Cato Institute and Arizona State Representative John Kavanagh. Their worldview, in which their answers were couched, also was very different. “I certainly don’t disagree with the statement that we need workers, particularly unskilled workers,” said Kavanagh. “The question is who is going to perform that task? Do we use guest workers or do we let these especially low-skilled people (current undocumented workers in the U.S.) become permanent residents? Do we really want to have that many low-paid, ill-educated people who are a phenomenal drain on our economy? I think that’s a mistake.” Instead, he offered, guest workers should be allowed to stay for a very limited time – perhaps one or two years – and then they should “go back and be good members of their own society.” Griswold says this U.S. need for low-skilled workers is a positivesign that reflects higher educational levels in the U.S. and better economic and trade integration between the U.S. and Mexico. “The vast majority of Americans do not compete with immigrants. The best studies show that even among low-skilled Americans without a high school diploma, their wages are depressed just one or two percent because of immigrants in the workforce,” he says, adding that the answer for low-skilled U.S. workers is to achieve a high school diploma. “On average, you get a 38 percent raise right there over somebody who’s a high school dropout. I think that’s a much better response than building walls and raiding tomato fields,” Griswold noted. (Regarding the impact of immigrants in the workforce on U.S. wages, Gans noted, “If an immigrant competes with a native born worker, the wages will fall. That’s simple supply and demand economics. If an immigrant’s skills are complementary, the wages of that complementary worker actually go up.”) Griswold advocates a program similar to the U.S. Bracero Program from 1942 to 1964, but without the rigid ties those workers had to specific employers (which, if severed, could result in deportation). Border enforcement, yes, says Griswold, but combine it with a sensible program that recognizes the needs of the U.S. economy, and achieves both goals: a more secure border and a more vibrant U.S. economy. He believes this approach would rid communities of the ill-effects of coping with a labor system driven underground, such as crime and loitering by day workers waiting for jobs. A defensible temporary worker program need not wait until full border security has been achieved. Putting something together sooner would help “drain the swamp of smuggling and document fraud” and foster better cooperation by immigrants with law enforcement, he added. Olivas offered some additional design elements for a future immigration policy and guest worker program: (1) adopt a policy that is more market-driven and not so political, (2) empower business and industry to have a greater say in what immigration policy looks like; and (3) adopt a new paradigm – one that sees immigration policy as a “means to manage assets,” and not as a problem that needs to be managed. Crime and the Burden on Law Enforcement Increased violence and more deaths, as well as higher success rates by crossing the border in more remote areas, are viewed by some as unintended consequences resulting from a tighter U.S.-Mexican border. In addition, 24 border counties in the U.S., including four in Arizona, are being held responsible for more immigration-related costs, with federal reimbursement either non-existent or a small fraction of actual costs. This was one of the particularly lively discussions at the forum, spurred by the research of Tanis Salant, Ph.D., Director, School of Public Administration and Policy, Eller College of Management, University of Arizona, and Robin Herskowitz, President, RH2 Consulting, Inc., who has conducted extensive immigration research in Texas. In fiscal year 2006, the cost of criminal justice administration pertaining to illegal immigration (sheriff’s departments, detention, adjudication, indigent defense, and probation) for the 24 U.S. border counties adjacent to Mexico, was $192 million to process criminal illegal aliens (Arizona’s four border counties had costs of $26.4 million), all according to Salant’s research, which will be made available in March on BorderIssues.com.  Illegal immigrants, significantly, do not pose a major criminal problem, although they have been linked to burglaries as they make their way to U.S. job markets. Instead, “violent crimes are those committed by the immigrants’ smugglers,” Salant said. “With a guest worker program, you would knock out the peoples’ smuggler, as well as reduce drastically the incidence of burglary, therefore bringing the cost down to state corrections, but most especially to law enforcement and county detention.” The inadequacy of federal assistance (through the State Criminal Aliens Assistance Program (or SCAAP) was addressed by both Salant and Sheriff Ralph E. Ogden of Yuma County. Over the last four years, Ogden said, the average amount of money his department has gotten from this program “is ten cents on the dollar, so they’re really doing us a hell of a favor.” That’s about how well all 24 U.S. border counties did, said Salant, because they received some $4.7 million, or 9 percent, of a $400 million appropriation. “It’s clear that resources are the issue – more manpower on all levels, more money that gets reimbursed, our tax dollars coming back to where they need to be,” noted Chris Simcox, the President of the Minutemen Civil Defense Corps, a volunteer group that patrols the U.S. borders. Un-reimbursed cost is only one of the many frustrations for law enforcement. Another is the different operating styles of local and federal officials. Ogden says because of a lack of resources, federal officials set high thresholds on who gets prosecuted and who doesn’t, a distinction not made by local authorities who attack the problem aggressively.