McCarthyism, Then and Now

Nobody asked but …

The stale whiff of McCarthyism stole across the venue of the State of the Union address last week.  POTUS played the “socialism” card, or rather he just showed the back of the card, allowing no peeks at the face of the card — not of its value, not of its suit.  He was deliberately vague and ambiguous.  He traded in his wall and immigration, in favor of an even more nebulous concept, gearing up for 2020.  Wonder why he didn’t go all in against communism?

I am all in against both communism and socialism.  I believe that nothing should be subjugated to state interests.  That is why I believe that when politicians use fear of these preposterous systems, they are playing with fire.

Let’s face it, immigration and the border wall had 6 years of exposure under Bush II, and now another two under POTUS (clown car edition).  That’s more than double the mileage that Joe McCarthy got out of the era of McCarthyism.

All adult Americans should consider it a mandatory educational chore to learn, in some depth, the who, what, why, when, where, and how of the fervor against communism that distracted us, to the benefit of exploitative politicians, in the 1950s.  Google “books, articles, and research on McCarthyism.”  Make your own choices — you are responsible for what you learn.  Further, you are responsible for what you make of that knowledge.  It may be instructive to note that POTUS has invoked the words “witch hunt,” it seems, I could be wrong, more than has been done by any politician since the era of McCarthyism.

— Kilgore Forelle

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We Wanted Tech

“We wanted workers, but we got people instead.”  This line from Max Frisch didn’t just give George Borjas the title of his most recent book.  At last Friday’s immigration conference in St. Cloud, Borjas declared it his all-time favorite immigration epiphany.  The point, he explained, is that immigrants aren’t just machines that produce stuff; they have broad social effects on our culture, politics, budget, and beyond.

Borjas is right, of course.  In fact, he doesn’t go far enough.  After all, even machines aren’t just machines that produce stuff.  They too have broad social effects on our culture, politics, budget, and beyond.  If you look closely at any major technological development, you can justly say, “We wanted tech, but we changed society instead.”

Consider cellphones.  When they were first introduced, you might picture them as more convenient phonebooths.  But they’ve revolutionized not only our society, but our psychology.  Many human beings now interact with their phones more than they interact with fellow human beings; go to any public place and you will see this to be true.  Even when we are talking to fellow human beings, cellphones have changed the tone and tenor of our conversations.  When I casually chat with my friends, for example, we often fact check each others’ assertions.  And cellphones are crucial for social media, which has dramatically swayed not only public discourse, but elections and policy.  Without Twitter, would Donald Trump’s candidacy even have been able to get off the ground?

When driverless cars come, they’ll disrupt our whole society again.  Commuting time will plausibly skyrocket, especially in high-rent areas.  If you can relax – or even sleep – in your car, why pay $1M for a tiny apartment downtown?  Indeed, once you get rid of the driver’s seat, we’ll probably turn cars into small motorhomes, so “living out of your car” could become an alternative lifestyle rather than a tale of woe.  And what will happen to all the truck drivers, taxi drivers, Uber drivers, and delivery drivers?

Still not convinced?  I trust you’ll admit that nuclear technology did more to the world than slash electric bills.

Verily, we wanted tech, but we changed society instead.

How should you react to this truism?  You could say, “Duh, everybody knows this already.”  That’s my knee-jerk reaction to Frisch’s quote, too.  But both “duhs” are too dismissive.  “Obvious once you think about it”≠”Obvious.”

What else is there to say?

1. You could retreat to agnosticism.  “Well, there are direct economic benefits, plus an array of intangible social effects.  We don’t know how to measure these intangibles; we don’t even know if they’re good or bad.”  This is basically what Borjas said about immigration in his Friday talk.  There’s no reason we couldn’t generalize it.

Reaction: Philosophically, agnosticism of any kind is incoherent sophistry.  We always have some information.  We can and should combine this information with common sense to form reasonable guesses about whatever question is on our minds.  Crucially, “information” includes psychological evidence about the errors to which the human mind is prone.  And one of the best ways to keep your guesses reasonable is openness to bets.

2. You could start by measuring the direct benefits, then see if any of the broader social negatives are plausibly in the same ballpark.  If not, the standard conclusion still goes through despite the complexity of the world.

Reaction: Once you factor in the value of time, this is typically the best approach for laymen.  It’s a quick way to resolve a wide range of policy disputes, especially if you embrace some version of weak deontology rather than consequentialism.

3. You could try a lot harder to study the measurement of so-called “intangibles.”  This might require a massive research program to fill in the enormous gaps in our knowledge.  Or perhaps if you play around on Google Scholar, you’ll discover that many researchers have already measured the stuff you imagine “no one knows.”

Reaction: This is the best approach for experts.  If you do good work and/or publicize it, you also help laymen reach the truth with modest mental effort.  So earn your paycheck!

Whatever you conclude, know that immigration is nothing special.  Everything has broader social effects.  These complexities are no reason to defer to popular prejudice, which is what I suspect Borjas hopes we’ll do.  Instead, these complexities are a reason to think broader and work harder to get the best answers we can.

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Immigration and Redistribution: The Research to Trust

Evaluating the quality of research is laborious.  Unless you re-do the whole paper yourself, how do you know the authors were not only truthful, but careful?  Faced with this quandary, one of my favorite heuristics is to ask: Did the authors want to find this result?  If the answer is No, I put a lot more credence into the results.  In research as in the law, statements contrary to interest count more.

For example, when I learned that most economists find little effect of national education on national GDP, I was simultaneously surprised and convinced.  Surprised, because I know that most economists want to find a big effect of national education on national GDP.  Convinced, because if legions of smart people fail to find the result they want, the best explanation is that what they want to believe isn’t true.

Moving along…  Many people debate the effect of immigration on redistribution.  Libertarians (like me) want to find that immigration reduces redistribution, because we like immigration but dislike redistribution.  As a result, non-libertarians sensibly discount libertarian claims that this is so.  Sensible libertarians would do the same.  People who agree with you are still flawed human beings, right?

So how can we approach the truth despite these impediments?  Well, most of the researchers who study the effect of immigration on redistribution are, in fact, left-wing.  They like immigration and redistribution, so they want to find that immigration increases redistribution.

In practice, however, they usually don’t.  And it disturbs them!  Here are two notable examples.

First, Alesina, Miano, and Stantcheva’s recent NBER working paper:

Support for redistribution is strongly correlated with the perceived composition of immigrants — their origin and economic contribution — rather than with the perceived share of immigrants per se. Given the very negative baseline views that respondents have of immigrants, simply making them think about immigration in a randomized manner makes them support less redistribution, including actual donations to charities. We also experimentally show respondents information about the true i) number, ii) origin, and iii) “hard work” of immigrants in their country. On its own, information on the “hard work” of immigrants generates more support for redistribution. However, if people are also prompted to think in detail about immigrants’ characteristics, then none of these favorable information treatments manages to counteract their negative priors that generate lower support for redistribution.

While Alesina et al. maintain a scholarly tone, their sympathies are pretty clear:

Anti-immigration parties have an incentive to maintain and even foster the extent of misinformation. Because information is endogenous, a vicious cycle of disinformation may arise. The more natives are misinformed, the more they become averse to immigrants and redistribution, and the more they may look for confirmation of their views in the media.

Second, Soroka, Banting, and Johnston’s chapter in Globalization and Egalitarian Redistribution (Princeton University Press and Russell Sage Foundation, 2006):

International migration does seem to matter for the size of the welfare state. Although no welfare state has actually shrunk in the face of the accelerating international movement of people, its rate of growth is smaller the more open a society is to immigration. To the extent that spending growth is inescapable, mandated by the aging of populations in industrial societies, specific parts of the welfare states—especially the parts that redistribute from rich to poor or from the old to the young—may truly have shrunk in the face of migratory pressures. Whatever the details, the typical industrial society might spend 16 or 17% more than it now does on social services had it kept its foreign-born percentage where it was in 1970.

Their sympathies, too, are also pretty clear:

What do the propositions imply? They do seem to vindicate Miller’s (1995) worries about threats to the national basis of the welfare state… The attitudinal problem is more among natives than newcomers and reflects more the apprehension of cultural threat than the fact of threat. But those apprehensions, combined with often realistic appraisals of cost and benefit, mean that the human component of globalization may represent a constraint on the expansion of welfare states that seemed fully consolidated two decades ago.

If you want to go meta, you could naturally object, “Libertarians want to believe that non-libertarian researchers support their desired conclusions.  So why should I trust Bryan’s summary of the research?”  Yes, it’s a problem, but it’s not insuperable.  Try reading Alesina et al.’s literature review and see for yourself if I’m being unfair.

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The Mighty Difference Between Immigration and Trade

What’s so great about international trade?  Economist’s standard answer boils down to two words: comparative advantage.  Specialization and trade increases total production, even if one side is more productive across the board.  A textbook example starts with a table that shows hourly productivity in two countries, such as the U.S. and Mexico.

Table 1: Trade and Productivity

U.S. Productivity Mexican Productivity
Cars/Hour 4 .1
Wheat/Hour 2 1

 

To see how specialization and trade raise TOTAL productivity, just imagine switching five U.S. hours from wheat to cars, and twenty Mexican hours from cars to wheat.  Total wheat production rises by (-5*2+20*1)=10, and total car production rises by (5*4-20*.1)=18.

When I teach the economics of immigration, I routinely tell students that immigration is trade in labor, so the same logic applies.  In fact, I just relabel the preceding table:

Table 2: Immigration and Productivity (simple version)

U.S. Productivity Mexican Productivity
Programs/Hour 4 .1
Childcares/Hour 2 1

 

When asked, “Sure, but what’s the point of moving the labor?,” my standard reply is: “You can’t export most services easily.  A Mexican nanny normally can’t perform childcare services for U.S. families unless she lives in the U.S.”

It’s a fine answer.  But on reflection, it deeply underestimates the economic benefits of immigration.  Why?  Well, international trade is a wonderful thing, but merely trading goods across borders has no blatant effect on the productivity of the workers who produced the goods.*  When a worker migrates from a low-productivity country to a high-productivity country, however, he becomes vastly more productive almost overnight.  To really show the economic effect of migration, then, you should imagine moving from the world of Table 2 to the world of Table 3.

Table 3: Immigration and Productivity (improved version)

U.S. Productivity Mexican Productivity
Programs/Hour 4 1
Childcares/Hour 2 2

 

Table 3 implies that migration raises productivity even if workers continue to use their time exactly as they did before.  Suppose you move twenty Mexican hours from Mexico to the U.S.  The workers continue to split their time evenly between programming and childcare.  Production still rises by (10*(1-.1))=9 programs and (10*(2-1))=10 childcares.  The mechanism can’t be comparative advantage, because the division of labor remains unchanged.  The world is richer, rather, because Mexican talent has moved from a production desert to a production oasis.  Once the immigrants arrive, of course, it makes great sense to specialize and trade; but immigration would have great economic benefits even if no one reconsidered his occupation.

Yes, I am well-aware that some researchers fear that immigration will transform production oases into production deserts.  My forthcoming book has a whole chapter on this topic.  The key point for now: Almost everyone – including me – has hitherto underestimated the gross economic benefits of immigration.  And until we accurately measure immigration’s gross benefits, we can’t accurately measure its net benefits, either.

* Though there could be a big non-blatant effect; see Bloom and van Reenen on the managerial benefits of multinationals.

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Taking The Bait; Abandoning The High Ground

There is no such thing as an “unethical necessity” or “necessary evil”. It’s an oxymoron.

If something is necessary, it can’t be unethical, and if something is unethical it can’t be a necessity. Maybe you can’t see another way, but it’s there. It is never necessary to rape a baby, in other words.

Those who believe in such fantasies have fallen prey to pragmatism.

Yes, I can understand why they do it. Principles are hard. They may not even be safe to stick with– no one ever said doing the right thing was easy, safe, or would result in instant (or eventual) Utopia. But it’s still the right thing.

For some reason, Trump and “immigration” have fooled more people into abandoning principles– and what’s right— than anything I’ve ever personally witnessed. Maybe other things were stronger archation bait in the past, but that must have been before my time.

This would be scary, except that I understand the concept of winnowing grain; to allow the chaff and harmful debris to fly away with the breeze so it doesn’t end up choking you in your food. So I see this as a way to see who’s on the side of liberty, and who was hanging around while it was convenient and easy. Seeing some of those who have chosen to fly to statism at the earliest provocation has been a huge surprise… and a bitter disappointment… to me.

Someone has to stake out the ethical, principled ground. There are plenty of pragmatists and quislings around; that position is well represented. No more of them are needed.

If you approach every problem from the position that statism is unavoidable (or necessary), you’re going to find statist “solutions” to accommodate your statist objections every time. You’ll be blind to real, lasting voluntary solutions when you assume statism. Thus you’ll justify States and all the horrid things which come along with them– while using the inevitable results of statism to show why “we need statism”. You’ll get angry at anyone who points out that your assumptions are flawed.

And that is the unvarnished reality.

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The Call to Entrepreneurship and Our Excuses

Think starting up your dream business is a daunting task?

Imagine going straight from being on vacation to starting up a complex refugee rescue mission under the nose of the Nazis – with no prior experience and no preparation.

That was 29 year-old stock broker Nicholas Winton’s entrepreneurial story.

From 1938 to 1939, Winton successfully organized the evacuation and foster care assignment of 667 Czech Jewish children – without special skills, with funds he raised, and without more than a few staff. He dropped everything, “cut all kinds of corners,” and worked furiously against time and the Nazis and the restrictive immigration policies of the Western democracies.

As he explains drily in a documentary made (much) later (rough quote):

“We even had (fake) passports made because the Home office was moving a bit slow. . . We didn’t bring anyone in illegally – we just sped up the process.”

This man had every reasonable excuse in the book to not take action. We certainly wouldn’t have blamed him if he had deferred action until he had returned from vacation and set up a nonprofit first.

But Winton was not that kind of human. And neither should we be.

I have lots of excuses for why I haven’t started a business yet: I’m looking for the right idea. I’m building skills. Im building capital.

My excuses will allow me to feel OK about delaying this challenge until I look examples like Winton in the eye. They saw clearly that their call to entrepreneurship was a matter of life and death for some people – and they acted accordingly, without the slightest preparation.

Oh, and Winton? At the age of 89 he was working on (not staying in) a home for the elderly. If you let yourself start as well as Winton did, it will be pretty hard for you to stop.

Originally published at JamesWalpole.com.

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