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Tags: trump | immigration | economy | workers

Experts: GOP's 'Economically Reckless' Refugee Ban Will Hurt Trump Goals

Experts: GOP's 'Economically Reckless' Refugee Ban Will Hurt Trump Goals
(Dollar Photo Club)

Thursday, 03 August 2017 09:20 AM EDT

President Donald Trump has embraced Republican legislation that would dramatically reduce legal immigration and shift the nation toward a system that prioritizes merit and skills over family ties.

However, financial experts warn that the GOP plan could actually hurt the American economy because economic growth depends on expanding the workforce, not shrinking it, as the plan seemingly would accomplish.

In essence, experts warn that Trump's plan would hinder prospects for his own administration's economic growth goals. One expert called the plan "economically reckless."

Trump on Wednesday joined with Republican Sens. David Perdue of Georgia and Tom Cotton of Arkansas to promote the bill, which so far has gained little traction in the Senate.

"This legislation demonstrates our compassion for struggling American families who deserve an immigration system that puts their needs first and puts America first," Trump said during an event Wednesday in the White House's Roosevelt Room.

It was the latest example of the president championing an issue that animated the core voters of his 2016 campaign, following decisions to pull out of the Paris climate treaty and ban transgender people from the military, the Associated Press reported.

Perdue and Cotton's legislation would replace the current process for obtaining legal permanent residency, or green cards, creating a skills-based point system for employment visas. The bill would also eliminate the preference for U.S. residents' extended and adult family members, while maintaining priority for their spouses and minor children.

Overall, immigration would be slashed 41 percent in the legislation's first year and 50 percent in its 10th, according to projection models cited by the bill's sponsors. The bill would also aim to slash the number of refugees in half and eliminate a program that provides visas to people from countries with low rates of immigration.

The president has made cracking down on illegal immigration a hallmark of his administration and has tried to slash federal grants for cities that refuse to comply with federal efforts to detain and deport those living in the country illegally.

But he has also vowed to make changes to the legal immigration system, arguing that immigrants compete with Americans for much-needed jobs and drive wages down.

Most economists dispute the president's argument, noting that immigration in recent decades doesn't appear to have meaningfully hurt wages in the long run.

Increased immigration is also associated with faster growth because the country is adding workers, so restricting the number of immigrants could slow the economy's potential to expand.

The White House has set a goal of achieving 3% economic growth through a mix of tax reform, deregulation and other measures. Most economists say immigration would be a key contributor to achieving that mark.

"The only way the administration would be able to achieve its goal of 3% sustained real GDP growth would be to significantly increase foreign immigration into the U.S.," said Moody's Analytics economist Mark Zandi in a recent interview with TheStreet.

"Unfortunately, it appears to be going in the opposite direction, and working to restrict immigration," Zandi told TheStreet.

"We've achieved 3% growth in the past partly when assisted by rapid population growth, and favorable demographics," University of Michigan economist Justin Wolfers explained to TheStreet.  

"We are certain that both will be headwinds over the next few decades, as fertility has slowed, immigration looks likely to decline, and as the baby boomers enter retirement. And all of this occurs against a backdrop of relatively weak productivity growth, and with an economy that is closing in on full employment."

Meanwhile, Politico explained that economic growth, as measured by gross domestic product, is an increase in the quantity of goods and services produced by workers; the more workers, the more goods they can produce. "And with U.S. population growing at its slowest pace since the Great Depression, the only way the workforce can expand is through immigration," Politico said.

Economists tend to worry not about there being too much immigration, but rather not enough, Politico reported. 

To be sure, Donald Kerwin, director of the Center for Migration Studies, told Vice.com that he thinks Trump’s plan is economically reckless.

“We would be going from admitting 1 million a year in a country of 330 million people to one that's admitting 500,000. I think it's fairly reckless, economically reckless. They haven't thought it through very well,” Kerwin said.

“I must say it seems a bit ideological and it also seems that this was the plan all along, for certain politicians and groups. They didn't like the legal immigration either when they were railing against illegal immigration all these years,” Kerwin told Vice.com.

Business groups have echoed those concerns, saying a reduction in immigration flows could hurt the economy, Bloomberg explained.

"Not only do immigrants help grow the economy overall, but immigrants drive up wages for the overwhelming majority of Americans, and significantly so in areas and industries with more immigrants, where wage growth has outpaced the country overall," Todd Schulte, president of the Mark Zuckerberg-backed immigration group FWD.us, said in a statement.

Immigration advocacy groups say that by prioritizing high-skill workers, the extended family members of U.S. citizens will be disadvantaged. So, too, will immigrants looking to escape poverty or violence.

The bill's supporters, meanwhile, say it would make the U.S. more competitive, raise wages and create jobs.

Backers said the bill would sharply increase the proportion of green cards available to high-skilled workers and would not affect other high or low-skilled worker visa programs such as H1-B and H2-B visas. The Trump Organization has asked for dozens of H-2B visas for foreign workers at two of Trump's private clubs in Florida, including his Mar-a-Lago resort.

The White House said that only 1 in 15 immigrants comes to the U.S. because of their skills, and the current system fails to place a priority on highly skilled immigrants.

But the Senate has largely ignored a previous version of the measure, with no other lawmaker signing on as a co-sponsor. GOP leaders have showed no inclination to vote on immigration this year, and Democrats quickly dismissed it.

"The bottom line is to cut immigration by half a million people, legal immigration, doesn't make much sense," said Senate Democratic leader Charles Schumer of New York, who called it a "nonstarter."

The bill would create a new points-based system for applicants seeking to become legal permanent residents, favoring those who can speak English, have high-paying job offers, can financially support themselves and offer skills that would contribute to the U.S. economy. A little more than 1 million green cards were issued in 2015.

In a nod to his outreach to blue-collar workers during the campaign, Trump said the measure would prevent new immigrants from collecting welfare for a period of time and help U.S. workers by reducing the number of unskilled laborers entering the U.S.

But the president is mischaracterizing many of the immigrants coming to the United States as low-skilled and dependent on government aid.

The Pew Research Center said in 2015 that 41 percent of immigrants who had arrived in the past five years held a college degree, much higher than the 30 percent of non-immigrants in the United States. A stunning 18 percent held an advanced degree, also much higher than the U.S. average.

Trump has long advocated for the changes and vowed during an immigration speech in Phoenix last August to overhaul the legal immigration system "to serve the best interests of America and its workers." He voiced support for the Senate bill at a rally last week in Ohio, where his call for a "merit-based system" that "protects our workers" generated loud cheers.

Some immigrant advocates have criticized the proposal, saying that slashing legal immigration would hurt industries like agriculture and harm the economy.

"Our system is broken, but the response should be to modernize it, not take a sledgehammer to it," said Jeremy Robbins, executive director of New American Economy, a group backed by former New York City Mayor Michael Bloomberg.

(Newsmax wires services the Associated Press, Bloomberg and Reuters contributed to this report).

© Copyright 2023 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

President Donald Trump has embraced Republican legislation that would dramatically reduce legal immigration and shift the nation toward a system that prioritizes merit and skills over family ties.
trump, immigration, economy, workers
Thursday, 03 August 2017 09:20 AM
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