Humanity and Justice
A Moral Economy #2. Part I: What would it look like? (continued)
This is the second in a three part series of excerpts from Social Security Basic Income: A Safety Net for All Americans, which I published in March 2020. Part II is What do we have? and Part III is How do we get from here to there? This essay includes text from Chapter 4 Moral Inventory and Chapter 6 American Dream Reboot. Refer to #1 in the series for a brief introduction of my purpose and perspective on this subject.
Coherent and humane immigration policy
As indicated in the Introduction, while income inequality is a huge problem and the focus of my book on the basic income guarantee, it is just a symptom of our failure to protect freedom for all Americans. There are many others for which policy reforms are overdue. Serious treatment is beyond the scope of this effort; however, it is helpful to provide at least one example of how institutional barriers keep many of us from fully exercising our rights.
We all realize and appreciate that the United States of America was built by immigrants, and most of us want to honor and protect that heritage. However, taking that attitude seriously leaves us with a larger problem: Hard-working, law-abiding immigrants take “our” jobs. Protectionism, not security or a more general law enforcement ideal, drives objection to reforms that grant amnesty to illegal immigrants or increase the flow of temporary workers. People who resent free trade or other vehicles of globalization are doubly offended when cheap labor is imported. When that labor enters the market illegally, righteous indignation boils in the emotional cauldron. This attitude runs deep in America, and it is shared by people across the left-right political spectrum.
Redistribution, especially on the scale of a federal income guarantee, raises the stakes for a debate on immigration policy that has already proven very difficult. A more generous welfare policy can only attract more immigrants, which makes it even more important to identify citizens and how our rights and benefits differ from those of other residents. Therefore, adoption of any federally guaranteed income policy is likely to be accompanied by immigration reforms.
The widely held opinion that immigrants are a drag on our economy is a myth. The truth is that we are increasingly dependent on them, not only because many of them do work we don’t want, but because they are younger, on average. Baby boomer retirements are creating a demographic headwind of increasing dependency on the working age population. The Census Bureau quantifies this as an “old-age dependency ratio” by comparing populations 65 and over with those 18–64 years of age. From 2010 to 2030, we will have gone from an economy in which nearly five working age people are available to support each person of retirement age to one in which just three people would bear the same burden. Over roughly the same period, barring dramatic changes in recent trends, it is immigrants who will keep the workforce from shrinking (see figure below). They will save us from having to bribe our citizens to have more children so we can tax their children later to pay our debts. Even for such selfish reasons, we should welcome immigrants with open arms.
In this context [of rising inequality between skilled and unskilled workers, lower economic growth, and a shrinking workforce], increased immigration can provide many benefits to the U.S. economy. It can benefit consumers by helping reduce the costs and increase the availability of important goods and services, especially those such as health and elder care where demand will rise rapidly as the population ages. Immigration can also contribute some balance to the federal budget as baby boomers retire and pay much lower taxes while drawing heavily on Social Security and Medicare. And finally, it can raise economic growth by replenishing a labor force that would otherwise diminish.
Immigrants are also among the greatest innovators in the U.S. One recent study that compared patents, patent citations, and economic value of patents found that immigrants were responsible for a disproportionate share when compared to native-born inventors. Another study of entrepreneurship found that first-generation immigrants, which make up approximately 14 percent of our population, create 25 percent of all new businesses in the U.S. It’s not difficult to understand why; these are people who have endured tremendous risks seeking better opportunities in our country.
The social welfare system we have now is clearly communitarian; it prioritizes our right to control membership and take care of our own, meaning the group whose ancestors arrived first. We could replace this seniority system with one that protects those most in need of assistance. While the impact of poor immigrants on the welfare state is not in question, their impact on social welfare is a function of the period chosen for measurement. Immediate redistribution from native workers to employers and immigrants is offset by economic growth that benefits everyone in the long run. Thus, concerns for social welfare do not justify closing our borders.
Functional immigration policies would reflect a cosmopolitan, liberal, egalitarian approach in which equal opportunity has precedence over redistribution. A free society would embrace the moral imperative of welcoming hopeful and well-meaning immigrants, commit to their (eventual) full acceptance, and adjust other public policies accordingly. Providing a path to citizenship for illegal immigrants solves a host of problems. It leads to higher wages for them, which reduces their threat to citizens’ jobs, increases tax revenue and reduces impact on welfare agencies. There is less need to audit employers for illegal practices connected with undocumented workers. Competition takes place on a level playing field and the transparency of the process allows rapid adjustment to market forces.
Justice and peace
On Martin Luther King Day in 2019, I read one of the reverend’s speeches that provided yet another reminder of how long ago our income inequality problem was identified and how little progress we have made. He said we had “Socialism for the rich and Capitalism for the poor,” and elaborated: “It is this moral lag in our thing-oriented society that blinds us to the human reality around us and encourages us in the greed and exploitation which creates the sector of poverty in the midst of wealth. Again we have deluded ourselves into believing the myth that Capitalism grew and prospered out of the protestant ethic of hard work and sacrifice; the fact is that Capitalism was built on the exploitation and suffering of black slaves and continues to thrive on the exploitation of the poor — both black and white, both here and abroad.” And finally,
So, we are here because we believe, we hope, we pray that something new might emerge in the political life of this nation which will produce a new man, new structures and new institutions and a new life for mankind. I am convinced that this new life will not emerge until our nation undergoes a radical revolution of values. When machines and computers, profit motives and property rights are considered more important than people the giant triplets of racism, economic exploitation and militarism are incapable of being conquered. A civilization can flounder as readily in the face of moral bankruptcy as it can through financial bankruptcy. A true revolution of values will soon cause us to question the fairness and justice of many of our past and present policies…. A true revolution of values will soon look uneasily on the glaring contrast of poverty and wealth, with righteous indignation it will look at thousands of working people displaced from their jobs, with reduced incomes as a result of automation while the profits of the employers remain intact and say, this is not just…. A nation that continues year after year, to spend more money on military defense than on programs of social uplift is approaching spiritual death.
Dr. King’s insight was that we needed “a radical revolution of values.” We still do. What does that mean? He told us to “look uneasily on the glaring contrast of poverty and wealth.” I am uneasy about it because it indicates unnecessary suffering — not just the possibility of relief but the possibility that it could have been prevented.
Redistribution of income treats the symptoms, but it does not necessarily treat the disease of prejudice. It is highly likely to further divide us, because so many of us believe welfare is shameful and taxation is theft. What’s so wrong with this is that wealth affords preferential treatment. “Possession is 9/10 of the law” is a saying that aptly describes our perverse tax policy of requiring employers to withhold the first 15 cents of every worker’s earnings while employers and their shareholders pay taxes on the honor system. The message, which is reinforced by virtually all welfare policies in our country, is that poor people cannot be trusted. Some people may believe it’s because they deserve to be poor as punishment for past deeds or because they are unwilling to earn their keep. Some may believe it’s because they are desperate and likely to lie or take advantage of others to escape their predicament. Poor people in the US are not all black or Hispanic but those who are black or Hispanic are more likely to be poor. This means prejudice against the poor hides racist motives. Not all of those who do not trust the poor are racist, but I would wager most racists do not trust the poor.
For half a century, public policies have treated poverty and race separately. In How to Be an Antiracist (2019), Ibram Kendi, also citing Dr. King, says racism and capitalism are “conjoined twins” that will live or die together. It is naïve, he says, to fight them independently. It appears to me that one reason we have made so little progress on either is that we tried to have it both ways — pretending to help everyone (with antidiscrimination laws) while holding back on welfare and other forms of assistance that might allow poor blacks and immigrants to climb into the middle class. It seems counterintuitive, but I believe the way out is to focus on a colorblind policy to alleviate poverty. Any federal basic income guarantee is a direct challenge to the ideas that poor people do not deserve help and cannot be trusted. It isn’t even an appeal to sympathy for the poor; its premise is that all of us are deserving and trustworthy. Federal, state, and local governments have myriad tools to deal with exceptions — those who need more and those who abuse our trust. My hope is that by weaving into the fabric of our most fundamental interaction with all other American citizens a meaningful commitment to equality, all of us may find greater justice and peace.
The next essay in this series will be the first on Part II What do we have? It will include text from Chapter 2 What’s the Problem?
