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How opening all borders may make everyone a whole lot richer

Hey, do you want to end all the poverty on earth? Then open all the borders!

Now obviously, there is not a single person in American politics advocating for open borders, whether you’re a democratic socialist like Bernie Sanders, or a WWE personality turned Republican front-runner like Donald Trump.

This shouldn’t come as a surprise. The idea that we should defend our borders is taken as a basic assumption in American politics. The budget for border protection was $16.2 billion in 2014, and we spend it because we think hordes of people will come rushing in if we don’t have strong borders.

So the idea of opening our borders sounds crazy! In fact, it’s so crazy it just might work.

According to economists who study the effects of free and open migration, it could actually double the global GDP.

“A very standard estimate is that open borders would double the production of the world,” George Mason University economics professor Bryan Caplan said.

We spoke to Caplan and Michael Clemens at the Center for Global Development, both of whom have done extensive studies on the effects of extremely loosened migration controls. Their basic conclusion is that we generally put far too many restrictions on the movement of people internationally.

It doesn’t make economic sense and it doesn’t make moral sense.

The simple argument for more open migration is that the average worker is much more productive in a rich and developed economy than in a poor and underdeveloped economy.

Clemens explains it using the same border where Trump wants to build his wall as an example:

“If you take a drive, say, from Yuma, Arizona, across the border into San Luis Sonora, Mexico, you might see construction workers maybe building a house on both sides of the border. Similar looking guys, hammering the same nail into the same board on both sides of the border. Only, the guys in San Luis might be making $13 a day and the guys in Yuma might be making more like $13 an hour. Just moving across a gap like that can be completely transformative for people.”

The most common argument against immigration is that the increased supply of foreign workers would drive wages down for native workers, which sounds like a sound argument for anyone who has studied the supply and demand curve in Economics 101.

The problem is that workers aren’t goods. They are people who produce things and consume things. Studies have shown that an increased supply of workers often raises the wages of existing workers.

“Immigrants buy the things that Americans produce. Immigrants compliment American workers in the workplace,” Clemens said. “Immigrants also raise the productivity of investment in U.S. business which ends up indirectly generating jobs for Americans.

“Even over quite short periods of time, you find flows of migrants into the U.S. labor market associated with growth of employment, rather than the other way around.”

A migrant worker has more purchasing power once across the border, which means she can buy more stuff. That, in turn, stimulates employment for other people who produce the stuff the migrant working is buying.

Intel Corporation Chairman Andrew Grove listens to a question during the Business Software Alliance's (BSA) 5th Annual CEO Forum, June 7, 2000 in Washington, DC. On September 22, 2000, following a warning from Intel that third-quarter sales could fall far short of Wall Street predictions, the prices of technology stocks fell sharply on both the NASDAQ and the New York Stock Exchange. (Photo by Alex Wong/NewsmakersAlex Wong/Newsmakers/Getty Images

Andrew Grove fled Hungary at the age of 20 before eventually becoming CEO of Intel.

Clemens related the story of Andrew Grove, who was born in Budapest to a dairyman. He came to the U.S. as a poor teenager fleeing the Nazi occupation. Later, he helped found Intel, the microchip maker, which went on to revolutionize the PC industry. Had he stayed in Hungary, his contributions to the world would have almost certainly been close to zero. But because he was able to cross a border, he created untold amounts of wealth that would otherwise not have existed.

An easier way to understand how new workers can create wealth is to examine the entrance of women in the workforce. Back in the day, barely any women had jobs outside the home. Then the number of women in the workforce grew from 18 million in 1950 to 66 million in 2000. That’s a huge influx of new workers! But it’s not like all the men were suddenly out of jobs. In fact, America just kept getting richer and richer.

“You had a whole lot of women who would previously have been stay-at-home moms,” Caplan said. “They entered the labor force. In the very short and narrow sense we’d say they took jobs from men. But the long-run result is not that men can’t find jobs; the long-run result is that production is higher and people can enjoy a higher standard of living. …

“This is not just women who benefit. It’s everyone who buys stuff [who] benefits. It’s not just the migrants who benefit, it’s everyone who consumes what the migrants are making.”

January 1915:  Women munitions workers in a Vickers factory maing shell cases.  (Photo by Topical Press Agency/Getty Images)Topical Press Agency/Getty Images

Only 34% of American women held jobs outside the home in 1950. Fifty years later, that number swelled to 60%.

Like those women entering the workforce in the 1950s, immigrants take jobs, but they also create them. 96% of American labor economists think immigration has a net positive economic impact.

Clemens again:

“Economist Mette Foged, who’s at the University in Copenhagen, studied the effects of these refugees on Danish workers over the last 20 years and found them to be positive effects, even for low-skilled Danes. That is, the refugees coming inare complimenting Danes and freeing them up to do more complex tasks, tasks that require cultural knowledge, that require Danish language. … Really everyone can benefit from the economic potential of these migrants. It needs to be unleashed.

“But if we’re talking about on the whole, the basic economic fact is that migrants are adding value to the government. They are subsidizing the rest of us.”

But is there a limit? Will we eventually simply run out of space for all these people? Matt Yglesias, writing for Slate, crunched some of the numbers:

According to Gallup there are 150 million people around the world who say they’d like to move permanently to the United States. Right now the United States has about 89 residents per square mile. Add another 150 million people and we’d be at around 135 people per square mile. How would that stack up in context? Well, France has 303 people per square mile and Germany has 593. Japan has 873. The Dutch have 1,287!”

The other common fear is that immigrants will blow up the welfare state. How can we possibly provide benefits to all these people coming in? According to a report by the U.S. Chamber of Commerce, immigrants actually contribute more to welfare than they take in benefits. This is because most immigrants pay federal and state income, Social Security, and Medicare taxes, which are all automatically deducted from their paychecks, while many of them are ineligible for the benefits.

BATON ROUGE, LA - SEPTEMBER 3:  Over 200 people line up at the Baton Rouge Department of Social Services to register for emergency Aid after Hurricane Katrina on September 3, 2005 in Baton Rouge, Louisiana. Baton Rouge has become the most populated city in the state after taking on evacuees from Hurricane Katrina.  (Photo by Chris Graythen/Getty Images)Chris Graythen/Getty Images

Immigrants frequently contribute to Social Security and pay other taxes without reaping the benefits.

But if we stop and think about it for a second, we also have a moral obligation to let people in. If we truly believe that all humans are created equal, then there is no way that we can make the argument that others don’t deserve the same opportunities that we’ve been given.

Those of us who were born here hit the lottery, man. We were just lucky enough to be born in the richest country in the history of the world. So who the hell are we to deny others these economic benefits that we did basically nothing to earn?

Especially because those benefits are enormous.

Someone from Haiti can earn about 2,000 percent more in wages here the U.S., which is insane. So why don’t we just give these people the chance to earn a lot more money and climb out of poverty?

“Even just crossing a border dramatically changes what people can do with their skills,” Caplan said.

Yet still, opposition to immigration is vehement. Why is that?

“The reason why people gravitate toward immigration restrictions rather than more targeted solutions to the problem, ultimately, is xenophobia,” Caplan said. “They’re not really worried about the problems, they’re worried about the people.”

He’s right. We’ve convinced ourselves that we need border restrictions, because we assume that’s just what countries do, so we’ve never confronted just how unfair that is. You cannot make an argument to defend the position that just being born somewhere should give you enormous benefits over someone born in Haiti or Syria without ultimately drenching yourself in xenophobia.

So forget Trump. Forget all 87 other candidates. As crazy as it sounds, open borders would end the suffering of millions of poor people around the world, not to mention the Syrian refugees currently stuck with no place to go, all while making us richer.

But don’t listen to me, listen to this guy. He was an actor or something.

How opening all borders may make everyone a whole lot richer

Hey, do you want to end all the poverty on earth? Then open all the borders!

Now obviously, there is not a single person in American politics advocating for open borders, whether you’re a democratic socialist like Bernie Sanders, or a WWE personality turned Republican front-runner like Donald Trump.

This shouldn’t come as a surprise. The idea that we should defend our borders is taken as a basic assumption in American politics. The budget for border protection was $16.2 billion in 2014, and we spend it because we think hordes of people will come rushing in if we don’t have strong borders.

So the idea of opening our borders sounds crazy! In fact, it’s so crazy it just might work.

According to economists who study the effects of free and open migration, it could actually double the global GDP.

“A very standard estimate is that open borders would double the production of the world,” George Mason University economics professor Bryan Caplan said.

We spoke to Caplan and Michael Clemens at the Center for Global Development, both of whom have done extensive studies on the effects of extremely loosened migration controls. Their basic conclusion is that we generally put far too many restrictions on the movement of people internationally.

It doesn’t make economic sense and it doesn’t make moral sense.

The simple argument for more open migration is that the average worker is much more productive in a rich and developed economy than in a poor and underdeveloped economy.

Clemens explains it using the same border where Trump wants to build his wall as an example:

“If you take a drive, say, from Yuma, Arizona, across the border into San Luis Sonora, Mexico, you might see construction workers maybe building a house on both sides of the border. Similar looking guys, hammering the same nail into the same board on both sides of the border. Only, the guys in San Luis might be making $13 a day and the guys in Yuma might be making more like $13 an hour. Just moving across a gap like that can be completely transformative for people.”

The most common argument against immigration is that the increased supply of foreign workers would drive wages down for native workers, which sounds like a sound argument for anyone who has studied the supply and demand curve in Economics 101.

The problem is that workers aren’t goods. They are people who produce things and consume things. Studies have shown that an increased supply of workers often raises the wages of existing workers.

“Immigrants buy the things that Americans produce. Immigrants compliment American workers in the workplace,” Clemens said. “Immigrants also raise the productivity of investment in U.S. business which ends up indirectly generating jobs for Americans.

“Even over quite short periods of time, you find flows of migrants into the U.S. labor market associated with growth of employment, rather than the other way around.”

A migrant worker has more purchasing power once across the border, which means she can buy more stuff. That, in turn, stimulates employment for other people who produce the stuff the migrant working is buying.

Intel Corporation Chairman Andrew Grove listens to a question during the Business Software Alliance's (BSA) 5th Annual CEO Forum, June 7, 2000 in Washington, DC. On September 22, 2000, following a warning from Intel that third-quarter sales could fall far short of Wall Street predictions, the prices of technology stocks fell sharply on both the NASDAQ and the New York Stock Exchange. (Photo by Alex Wong/NewsmakersAlex Wong/Newsmakers/Getty Images

Andrew Grove fled Hungary at the age of 20 before eventually becoming CEO of Intel.

Clemens related the story of Andrew Grove, who was born in Budapest to a dairyman. He came to the U.S. as a poor teenager fleeing the Nazi occupation. Later, he helped found Intel, the microchip maker, which went on to revolutionize the PC industry. Had he stayed in Hungary, his contributions to the world would have almost certainly been close to zero. But because he was able to cross a border, he created untold amounts of wealth that would otherwise not have existed.

An easier way to understand how new workers can create wealth is to examine the entrance of women in the workforce. Back in the day, barely any women had jobs outside the home. Then the number of women in the workforce grew from 18 million in 1950 to 66 million in 2000. That’s a huge influx of new workers! But it’s not like all the men were suddenly out of jobs. In fact, America just kept getting richer and richer.

“You had a whole lot of women who would previously have been stay-at-home moms,” Caplan said. “They entered the labor force. In the very short and narrow sense we’d say they took jobs from men. But the long-run result is not that men can’t find jobs; the long-run result is that production is higher and people can enjoy a higher standard of living. …

“This is not just women who benefit. It’s everyone who buys stuff [who] benefits. It’s not just the migrants who benefit, it’s everyone who consumes what the migrants are making.”

January 1915:  Women munitions workers in a Vickers factory maing shell cases.  (Photo by Topical Press Agency/Getty Images)Topical Press Agency/Getty Images

Only 34% of American women held jobs outside the home in 1950. Fifty years later, that number swelled to 60%.

Like those women entering the workforce in the 1950s, immigrants take jobs, but they also create them. 96% of American labor economists think immigration has a net positive economic impact.

Clemens again:

“Economist Mette Foged, who’s at the University in Copenhagen, studied the effects of these refugees on Danish workers over the last 20 years and found them to be positive effects, even for low-skilled Danes. That is, the refugees coming inare complimenting Danes and freeing them up to do more complex tasks, tasks that require cultural knowledge, that require Danish language. … Really everyone can benefit from the economic potential of these migrants. It needs to be unleashed.

“But if we’re talking about on the whole, the basic economic fact is that migrants are adding value to the government. They are subsidizing the rest of us.”

But is there a limit? Will we eventually simply run out of space for all these people? Matt Yglesias, writing for Slate, crunched some of the numbers:

According to Gallup there are 150 million people around the world who say they’d like to move permanently to the United States. Right now the United States has about 89 residents per square mile. Add another 150 million people and we’d be at around 135 people per square mile. How would that stack up in context? Well, France has 303 people per square mile and Germany has 593. Japan has 873. The Dutch have 1,287!”

The other common fear is that immigrants will blow up the welfare state. How can we possibly provide benefits to all these people coming in? According to a report by the U.S. Chamber of Commerce, immigrants actually contribute more to welfare than they take in benefits. This is because most immigrants pay federal and state income, Social Security, and Medicare taxes, which are all automatically deducted from their paychecks, while many of them are ineligible for the benefits.

BATON ROUGE, LA - SEPTEMBER 3:  Over 200 people line up at the Baton Rouge Department of Social Services to register for emergency Aid after Hurricane Katrina on September 3, 2005 in Baton Rouge, Louisiana. Baton Rouge has become the most populated city in the state after taking on evacuees from Hurricane Katrina.  (Photo by Chris Graythen/Getty Images)Chris Graythen/Getty Images

Immigrants frequently contribute to Social Security and pay other taxes without reaping the benefits.

But if we stop and think about it for a second, we also have a moral obligation to let people in. If we truly believe that all humans are created equal, then there is no way that we can make the argument that others don’t deserve the same opportunities that we’ve been given.

Those of us who were born here hit the lottery, man. We were just lucky enough to be born in the richest country in the history of the world. So who the hell are we to deny others these economic benefits that we did basically nothing to earn?

Especially because those benefits are enormous.

Someone from Haiti can earn about 2,000 percent more in wages here the U.S., which is insane. So why don’t we just give these people the chance to earn a lot more money and climb out of poverty?

“Even just crossing a border dramatically changes what people can do with their skills,” Caplan said.

Yet still, opposition to immigration is vehement. Why is that?

“The reason why people gravitate toward immigration restrictions rather than more targeted solutions to the problem, ultimately, is xenophobia,” Caplan said. “They’re not really worried about the problems, they’re worried about the people.”

He’s right. We’ve convinced ourselves that we need border restrictions, because we assume that’s just what countries do, so we’ve never confronted just how unfair that is. You cannot make an argument to defend the position that just being born somewhere should give you enormous benefits over someone born in Haiti or Syria without ultimately drenching yourself in xenophobia.

So forget Trump. Forget all 87 other candidates. As crazy as it sounds, open borders would end the suffering of millions of poor people around the world, not to mention the Syrian refugees currently stuck with no place to go, all while making us richer.

But don’t listen to me, listen to this guy. He was an actor or something.

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