April 2018

  • A Big Wall is a Waste of Time and Money


     

    There is so much hot debate about immigration, legal and illegal, that emotions run high whenever the subject comes up.  In fact, I may be stepping into hostile territory even writing this.  But I’m going to do it anyway because I think it’s important to put some of the economics of it into perspective.
    Most research has shown that the total population (an estimate, of course) of illegal Mexican immigrants into the US peaked in 2007 at 6.9 million and had fallen to 5.6 million by 2015.  That’s a net decrease of 150,000 a year over nine years.  In other words, more illegals were going home than coming in.  They were self-deporting!
    It turns out this trend isn’t isolated to illegal Mexicans.  We see a similar development when we look at the annual rate of new arrivals since 2000.  If we look at the annual legal and illegal immigration, we see that Mexico was the dominant force until the last peak in 2000.  About half of those were illegals.  But then that dropped from about 570,000 to 115,000 in 2011.  Since then the rise has been minimal, moving back to just 124,000 in 2016.
    Interestingly, that is about the same as the 122,000 immigrants from all of the Middle East and Africa.  East and South Asia immigration to the U.S. has been accelerating the most since 2003, but I don’t hear many complaints about that group.
    Since 2011, immigration from the rest of Latin America has been accelerating and they tend to come in more through Miami and Florida in general than across the US/Mexico border.  The exceptions are El Salvador, Honduras, and Guatemala.  Some of those immigrants sneak into Mexico and then into the U.S.  But many of the El Salvador immigrants, the largest group, were let in as refugees.  No wall would have stopped much of that!
    The first major peak for all new immigrants was in 2000 at 1.66 million.  After a major drop in 2011, 2016 looks to finally be a new high at around 1.80 million.  The total immigrant population of the US is now about 43.7 million, or about 13 percent of the total population.  Only 2.8 million of the immigrant population are from predominantly Muslim countries.
    The top 10 countries from which (legal and illegal) immigrants have come in are: 
    Mexico, at 11.6 million 
    China, at 2.7 million
    India, 2.4 million
    Philippines, at 1.9 million
    El Salvador, at 1.4 million
    Vietnam, at 1.4 million
    Cuba, at 1.3 million
    Dominican Republic, at 1.1 million
    Guatemala, at 0.9 million
    Columbia, at 0.7 million.
    Numbers are only part of this puzzle though.  Quality of the immigrant plays a major role in their impact on the U.S.  Guess which immigrants from those top 10 countries have the highest average income?  India!  The only immigrant group barely growing its legal immigration to the U.S. is, of course, Mexico, with its number of “net” illegal immigrants still shrinking.
    Now, before some of you start sending me hate mail, please note that I am not suggesting that illegal immigration is okay, or that there are no bad actors among them.  I am only trying to put the problem into perspective.  From an economic standpoint, there are many things we could do to stop illegal immigration that would be less costly and more effective than building a big-ole ugly and expensive wall which will take forever to build and not do much anyway.  If we’re going to do infrastructure spending, I can think of a lot of other projects that would be much more worthwhile and productive.  Just sayin’.  Thanks for reading.
    Nick Massey is President of Massey Financial Services in Edmond, OK.  Nick can be reached at www.nickmassey.com.  Investment advice offered through Householder Group Estate and Retirement Specialists, a registered investment advisor.

    There is so much hot debate about immigration, legal and illegal, that emotions run high whenever the subject comes up.  In fact, I may be stepping into hostile territory even writing this.  But I’m going to do it anyway because I think it’s important to put some of the economics of it into perspective.

     

    Most research has shown that the total population (an estimate, of course) of illegal Mexican immigrants into the US peaked in 2007 at 6.9 million and had fallen to 5.6 million by 2015.  That’s a net decrease of 150,000 a year over nine years.  In other words, more illegals were going home than coming in.  They were self-deporting!

     

    It turns out this trend isn’t isolated to illegal Mexicans.  We see a similar development when we look at the annual rate of new arrivals since 2000.  If we look at the annual legal and illegal immigration, we see that Mexico was the dominant force until the last peak in 2000.  About half of those were illegals.  But then that dropped from about 570,000 to 115,000 in 2011.  Since then the rise has been minimal, moving back to just 124,000 in 2016.

     

    Interestingly, that is about the same as the 122,000 immigrants from all of the Middle East and Africa.  East and South Asia immigration to the U.S. has been accelerating the most since 2003, but I don’t hear many complaints about that group.

     

    Since 2011, immigration from the rest of Latin America has been accelerating and they tend to come in more through Miami and Florida in general than across the US/Mexico border.  The exceptions are El Salvador, Honduras, and Guatemala.  Some of those immigrants sneak into Mexico and then into the U.S.  But many of the El Salvador immigrants, the largest group, were let in as refugees.  No wall would have stopped much of that!

     

    The first major peak for all new immigrants was in 2000 at 1.66 million.  After a major drop in 2011, 2016 looks to finally be a new high at around 1.80 million.  The total immigrant population of the US is now about 43.7 million, or about 13 percent of the total population.  Only 2.8 million of the immigrant population are from predominantly Muslim countries.

     

    The top 10 countries from which (legal and illegal) immigrants have come in are: 

     

    Mexico, at 11.6 million 

    China, at 2.7 million

    India, 2.4 million

    Philippines, at 1.9 million

    El Salvador, at 1.4 million

    Vietnam, at 1.4 million

    Cuba, at 1.3 million

    Dominican Republic, at 1.1 million

    Guatemala, at 0.9 million

    Columbia, at 0.7 million.

     

    Numbers are only part of this puzzle though.  Quality of the immigrant plays a major role in their impact on the U.S.  Guess which immigrants from those top 10 countries have the highest average income?  India!  The only immigrant group barely growing its legal immigration to the U.S. is, of course, Mexico, with its number of “net” illegal immigrants still shrinking.

     

    Now, before some of you start sending me hate mail, please note that I am not suggesting that illegal immigration is okay, or that there are no bad actors among them.  I am only trying to put the problem into perspective.  From an economic standpoint, there are many things we could do to stop illegal immigration that would be less costly and more effective than building a big-ole ugly and expensive wall which will take forever to build and not do much anyway.  If we’re going to do infrastructure spending, I can think of a lot of other projects that would be much more worthwhile and productive.  Just sayin’.

    Thanks for reading.

     

    Nick Massey is President of Massey Financial Services in Edmond, OK.  Nick can be reached at www.nickmassey.com. Investment advice offered through Householder Group Estate and Retirement Specialists, a registered investment advisor.

     


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