Here's an Idea That Could Save America's Economy: More Americans

The Atlantic

Increasing immigration may be our simplest path to long-term growth. 

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(Reuters)

As Congress crawls its way towards what might well be a historic debate on immigration reform, there's one, easy to repeat point our legislators need to keep in mind: The United States needs more people.

Truly, it does. Our birth rates are falling as our population is aging. That means fewer workers and more retirees. Even if you ignore the challenge of paying for Medicare and Social Security, that's is a poor recipe for long-term economic success. Just ask Japan what it's like when your country turns into an oversized nursing home. 

None of this seems to have registered with some of our policy makers.  

This morning, the House of Representatives came within just a nose hair of accomplishing something constructive when it passed a bill that would create 55,000 new annual visas for foreign students who earn graduate degrees in science, technology, engineering, and mathematics (aka, the STEM fields). That was not controversial. The idea of stapling greencards to diplomas is possibly the single biggest consensus issue in Washington at this moment. Heck, it's practically the only consensus issue. Who, after all, doesn't want to keep around brilliant engineers our tax dollars have helped educate? 

Nonetheless, the legislation approved by House Republicans drew widespread opposition from Democrats, who criticized it for treating immigration as "zero-sum game." In order to make room for the STEM grads, the bill's authors nixed another visa program aimed at countries that traditionally send low numbers of migrants to the U.S. Why force the trade-off and risk alienating liberals from what would otherwise be a rare moment of bipartisan accord? As a House Judiciary Committee aide explained to me in September, Republican leaders "did not want to increase legal immigration at a time when 8 percent of Americans are unemployed."  

Zero sum indeed. 

The United States already welcomes more than a million immigrants each year. The idea that rolling out the welcome mat for 55,000 more would actually exacerbate unemployment here is laughable on its face, especially considering that many of these grads specialize in fields suffering a skills shortage. Moreover, immigration tends to wax and wane with the health of the job market -- when we need more workers, immigrants show up. When we don't, they don't. It's not a coincidence that, since the recession, net migration from Mexico has fallen to zero. 

But what's most worrisome about the GOP's line of thinking isn't the wretched reasoning or what it what it portends for the STEM bill, which may well not make it past the Democratic controlled Senate. Rather, it's the possibility that this is a preview of what the GOP's negotiating stance will be when it comes time to talk about comprehensive immigration reform next year, as Capitol Hill looks likely to do. It will be a horrible missed opportunity if we give undocumented immigrants who are currently in the country a path to citizenship, but fail to raise the overall ceiling for legal immigration. That's because this might be our one shot in a generation to revamp our system in a way that ensures we have enough young workers flowing into the country years from now to support our graying population.  

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And without question, that will be one of our most pressing challenges in the decades to come. Yesterday, the Pew Research Center reported that America's birthrate fell 8 percent last year to its lowest level since 1920, when the country started keeping accurate records of the data. Although the drop-off can largely be blamed on the recession -- when the economy turns sour, families very reasonably tend to hold off on having kids -- it was both a brusque reminder of the demographic trouble the United States may one day face, and why we won't be able to fix it if we keep legal immigration at the same level it is now. 

As Pew explained, immigrant women today give birth about 50 percent more often than native women. The reason the U.S. fertility rate dropped as much as it did during the recession was that those immigrant families, whose finances don't offer a lot of cushion from the economy, had drastically fewer babies than in years past. The birthrate among U.S. born Americans fell just 6 percent from 2007 to 2010. Among the foreign-born, by comparison, it fell 14 percent. Among Mexican-born females, the dropoff was an astounding 23 percent.

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In short, we've been relying on working class immigrants to have lots of children to keep our country young(ish). Over the past few economically disastrous years that fact came back to bite us in our birth rates. When the economy recovers, hospital nurseries should fill back up too, especially as couples that held off on getting pregnant for financial reasons decide to make up for lost time. But over the long term, there's a chance we'll never return to the fertility levels of even the recent past. After all, birth rates among immigrants had been on a downward slope for most the two decades before the crash. Thank the double edged sword of family planning: great for individual families, terrible for our long-term economic plans. 

Chances are, then, that if we keep letting in the same number of new immigrants each year, we're looking at lower birth rates in the future. And, as a result, we're looking at fewer young people to support the aging Americans as they gobble up entitlement benefits. By 2030, about 20 percent of America's population is likely to be over the age of 65, up from about 13 percent just a few years ago. For reference, that would put us in 18 years exactly where doddering, demographically challenged Japan is today. 

There are two ways to deal with this problem. One is to sit around and pray that 3-child families suddenly come back into vogue among American couples, even at a time when wages are stagnant, healthcare is becoming ludicrously expensive, and careers are more volatile than ever. If that's your preferred approach, good luck. 

The other option is to let more immigrants into the country. Let in more ambitious immigrant families who have the desire to move to a abroad and work hard to make a better life. Let in more mothers and fathers who will likely want bigger broods than American born couples. It will mean more workers shopping, buying cars, and paying into social security and medicare, and it will mean more economic growth. 

We don't get many opportunities anymore to change the way something as fundamental as immigration works. We need to get this one right. We need more people. 





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