Monday, 26 September 2016

How pro-immigration policy is a boon to capital

I began thinking about this after I watched Bernie Sanders early in the campaign talk about immigration policy in an interview. And he said that pro-immigration policy is a right wing policy. He argued that it serves to bring down worker's wages. At first, I disagreed strongly with him. But after giving it more thought and putting the matter into a larger context, something which Sanders didn't do, I nonetheless came to his conclusion. And later on I was well surprised by George Galloway's stance vis-a-vis the Exist referendum; and his motivation was very reasonable in my opinion. Galloway said that the last straw for him was Greece (of how it was treated by the Troika). And he maintained that a sovereign country ought to be able to decide on its own immigration policy. When I heard him say that, I immediately thought about Palestine under British mandate, which was precluded to decide on its immigration policy. We all know what happened. Lots of American and European immigrants came in and settled down. The British Empire promised the land to both sides. Then they retreated. Conflict erupted. Might made right. And the Palestinians were screwed over by both the Arab powers and the British.

Now, to the issue at hand.

Let's take into account the other side of the balance sheet, namely, the countries from which people are emigrating from. Regions in these countries are being depopulated through this phenomenon. I shall use my country (Romania) as an example. A significant portion of the adult population has left the country to work abroad. Most of them work, others steal and beg, what can you do... They left their children in the care of their grandparents. The consequence of this massive emigration takes a heavy toll on families, and children in particular. The grandparents are too old to take care of them, or the grandparents don't work or have very low pensions... and bringing up the children is very hard. Sure, the money the parents send back home helps out, but it's not enough. And households have it particularly worse in the rural regions or in towns in which the local industries are dead. To offer up my personal view, I don't like the fact that Romanians are emigrating just to find work that pays well, when they could be working here - and the gods know this country needs a lot of work. Now, let's look at what happens in the countries who are the desired choice of immigrants.

How does capital benefit off them?

Well, more people in creates more demand to be covered and consequently, higher saving desires. More people willing to take on jobs for lower pay decreases labor's bargaining power and puts downward pressure on wages. So capital benefits from an inflow of non-skilled workers, skilled workers, and workers of higher specialization (such as doctors, for instance). In my country, there is no law which precludes public school graduates to leave the country immediately after they obtained their degrees. So the Romanian government covers the cost of their training, while countries in the West reap the benefits of that free training. So on the one hand, you have depopulation, and on the other, you have overpopulation - which in turn gives birth to racial and ethnic tensions, which in turn give birth to the usual debate between right and left - which split the middle class. And that debate most of the time is plagued by various views on morality, while the mechanics side of it, which produces actual effects, is lost in translation. So overall lower labor costs for capital makes it easy for Western firms to compete with producers from developing countries.

Romania, for instance, has been a net importer for a long time. The country imports a lot of things which could produce domestically, while it exports natural resources like timber (mostly illegally cut), minerals, and fuels. Recently in my country, foreigners may acquire land. Our hospitals are understaffed, underequipped, and underfunded. While more and more doctors are leaving the system, seeking to emigrate, with the students hot on their trail. Now, don't get me wrong. It's only natural for people to go out and seek the best life for themselves and their families. That's not what the issue is about. The issue is about pro-immigration policy being in fact a pro-capital policy, to the detriment of labor. Capital wins economically, or financially if you will. And it also wins politically, because it manages to divide the working class via identity politics. It exploits racial and ethnic tensions. Make no mistake, the mainstream left is also interested in keeping people divided, keeping capital on top of the hierarchy, defending rent seekers and economic parasitism. Hear out Michael Hudson in this great speech of his.

One way of dealing with this, in my opinion, is for Western governments and international organizations to take steps to reverse this process. One way of doing it is to promote full employment in the South and East, so that people will have an incentive to return to their homeland - and enjoy a good living there. It strikes me odd to concentrate so many people in one particular major region, instead of having them spread out and maintaining a comprehensive network between countries/societies. The problem of immigration will be solved once full employment will be the norm in every country. So when the mainstream left says, oh, we welcome immigrants. It's going to be great. And when they're asked about money. They'll say, oh, we'll cut here and there, increase tax there and over there, we'll have a balanced budget, lower government debt, and it will be great for both domestic labor and immigrants. When they say that, it's utter bs. It won't work. They won't deliver on their promises, and from their failure, the right will profit in the polls, and nothing's going to change - it will only get worse.

Let's remember that the Great Depression produced by the Roaring Twenties was not solved in the US by the New Deal. The New Deal alone wasn't enough to do it, because the program simply wasn't big enough - and Keynes told FDR this in his letters, telling him that he's not spending enough. When finally the US Government spent enough, it was because of war motivations. So the decision to enter WW2 was the political motivation to pursue fiscal policy for full employment.

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