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Notes -
Something I've never been clear on is how this dynamic is controversial. Obviously if labor is scarce wages will go up, eating away at the 'income inequality' boogeyman.
But try to argue that flooding the country with cheap labor will (besides making housing much more expensive) drive down wages and people smirk and tell you that's the "lump of labor" fallacy.
I don't think it is though. Yes, having more people around also generates some economic demand, but surely this is in the same sense that broken windows will generate economic demand? Unless those people are actually providing more value than they cost -- and here we must consider healthcare, education, wear and tear on infrastructure, social friction, decline in cohesion, crime, and so on -- doesn't the argument come down to "Well we have more mouths to feed so that generates economic activity"? And isn't that rather the broken window fallacy?
What is going on here?
Yes, it will drive up wages, but those wages will buy less, because there are less workers to produce goods and provide services. As long as each person produces more than they consume, each additional worker makes us better off.
There are two big hiccups:
"As long as each person produces more than they consume"; is this true? Illegal immigrants are generally not eligible for welfare, but they drive on public roads, use public libraries, illegal immigrant children go to public schools, etc. There are also negative externalities, but Latinos are much less criminal than blacks, and Latinos get rid of blacks, so it's probably a net positive.
Housing. We have insane zoning policies that forbid us from simply building enough housing for everyone. Per pigeonhole principle, if you have 100,500 people but only space for only 100,000, then 500 people must be homeless and the remaining 100,000 will spend all their spare money bidding up the rent to avoid being homeless. If you deport 1000 people and get the population down to 99,500, that would make a huge difference.
(Of course, would be better to just build more housing, but there wasn't a build more housing candidate on the ballot; there was a deportation candidate)
Changing tacks here but I'm not a fan of 'build more housing' outside of already-established high-density areas. I've seen too many lovely towns get ruined by the government deciding to (only) approve large blocks of 'low-income' housing which totally destroys the character of the community. Not to mention the natural beauty that tends to get paved over. Over time everything seems to tend toward a concrete hellscape and nowhere is different from anywhere else.
Also I'm just horrified by the loss of the dignity of single-family dwellings. My gut says that living in dense cities is somehow injurious to the human spirit and generates a lot of sicknesses downstream. If someone lives in an entirely man-made environment, why wouldn't they believe that everything's a social construct? Whereas if they're raised in and around nature, they will also perforce have to contend with nature, which would seem to inculcate some common sense in addition to other virtues.
I guess it's just not clear to me why we need more people rather than getting our existing people to be more productive.
Do you have any ideas about how to do that?
Reduce handouts and eject cheap foreign labor (especially of the illegal sort).
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