Daniel Garza: Economic Decline Brings Down Immigration

As the economic and demographic landscapes of both Mexico and some countries in Latin America undergo tectonic shifts, and our own economic growth continues to wane, suddenly, in a remarkably short time, immigration to America, both lawful and unlawful, has fallen – dramatically.

And while most of us are not more than a generation or two away from the immigrant’s experience, most Americans, strangely, ignore what current immigration trends say about our economic condition. But, the rise and fall of immigrants coming to America, both lawful and unlawful, speaks to the state of our economy – and it should concern us all.

Recent U.S. census figures show that the new arrival numbers of Mexican nationals, the largest immigrant group residing in the United States (some in violation of U.S. immigration law), have tumbled to almost negligible levels. In fact, fewer than 100,000 who entered into the United States unlawfully in 2010 hailed from Mexico; significantly lower than the 525,000 who did the same from 2000 to 2004 according to reports.

We are not only seeing a decrease in border crossings overall, but interestingly enough, we are now seeing a significant increase in the percentage of those entering the country with required documents. Recent figures indicate that 38 percent of total border crossings in 2011 were made with documentation; while in 2007, only 20 percent had entered with required credentials.

A 2008 report showed approximately 53.6 percent of immigrants residing in the United States came from Mexico, Central America, South America, or the Caribbean region. Additionally, 26.8 percent arrived from Asia, 13.1 percent originated from Europe, and the rest came from other corners of the globe. Of curious note is that although the foreign-born population of 38 million is at a record high – in sheer numbers that is – today they actually make up the smallest share of the population in over a hundred years.

While a reduction in job opportunities is credited as a major reason for keeping new arrivals in check, there are other significant factors contributing to the decline. The list includes a spate of recent policy changes that have served to toughen border security; the spike in drug violence that has made border crossing an even more dangerous proposition; and the decrease in demand for H-1B temporary visas for highly skilled workers by American companies.  Also notable, is that in previous years the cap for H-1B visa issuances of 65,000 would be reached the same month they became available – usually near the start of the year. In 2010, the cap was not met until the end of the year.

Other significant causes – variables that may alter immigration numbers for a long time to come – include a narrowing of the real wage gap, lowering birth rates, and a rise in educational attainment by those living under the poverty level.

Research shows Mexican family units are much smaller than they had once been, shrinking their fertility rates from about 7.3 children per woman in 1962 to 2.1 children today. In the area of education, the rate of people earning bachelor’s degree or higher in Mexico have doubled in many states with many of those degrees concentrated in the booming high tech field, and enrollment in tertiary education has more than doubled from 15 percent to 37 percent since 1991.

While these factors are determinant when taken as a whole, there is yet another reason – I would argue a more significant explanation – why immigrant numbers have fallen.

In recent years, our approval of big government policies, acceptance of ever increasing government intervention in the markets, the resulting housing crises, the disastrous Wall Street bailouts, our unfettered public spending, the rise of debilitating debt, and the spike of cronyism in the past few years have led to role reversals with some of our Western Hemisphere neighbors.

In a sense, we have become more like the governments that immigrants once fled, and those governments have adopted many of the free market principles that generated our vast prosperity. What I mean to say is we exported our free market principles – those that made us the most prosperous nation in the world – and imported Latin America’s failed statist principles.

The Frasier Institute’s 2010 Economic Freedom of the World report released earlier this year indicated we have fallen in the economic freedom ranking while countries like Chile, Mexico, Brazil and El Salvador have steadily gained.

Immigration from Mexico in particular had always been dictated by economic disparity with the United States (the largest such gap between any two nations in the world), but the neighboring economy is projected to grow its GDP rate by almost 5 percent this year, while the U.S. will barely register above 1 percent.

We have always led in innovation, creating technological wonders that never ceased to amaze the rest of the world. In America, we told our children anyone could succeed — that is, one was only limited by their ambition and desire to succeed. We dared them to be dreamers, to be go-getters and reach for the highest of pursuits.

It is true, outside of our borders many saw what we had built as the closest thing to The Shining City on the Hill.  For some, so strong was the passion to breath it’s free air and improve their lot in life, they were willing to come here in violation of our immigration laws – and to a lesser extent, they still do.

While I don’t condone violation of our immigration law, I hate to think we are losing that American exceptionalism, that land of the free, and that “give me your tired and your poor” stuff that drew immigrants from all over the world.

Previous generations of immigrants demonstrated a remarkable risk-taking spirit and a knack for creating jobs. Today’s potential immigrants are no different. But people see what is happening in America and are making a benefit/cost analysis of their options. And like never before, they are choosing to stay in their countries of origin because they do not feel they will be free to buy, sell, or trade in the United States at the same level immigrants who came before them were.

This very fact should concern us all. While economic and educational improvement in Latin America is a cause for celebration, our decline in those same areas certainly is not. In a very real sense, immigration to the U.S. is on the decline for not all together the right reasons.

Certainly government plays a central role in the marketplace, such as defining and enforcing the rules, protecting people’s right to own property and enforcing voluntary contracts between people. But America prospers most when we advance pro-liberty policies – a true free market approach with minimal government interference – rather than advancing policies that grow a coercive, centralized government.

As we lose our economic freedom, our future prosperity will diminish. To understand how terribly askew things are, simply look at the declining number of immigrants choosing to come to America.

Daniel Garza was formerly Associate Director at the Office of Public Liaison for The White House. He is currently the Executive Director of www.TheLibreInitiative.com.

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