A Christmas Carol
is a gooey confection of seasonal sentiment. It also is an economic manifesto. It concerned a 19th-century debate that is pertinent to today's argument about immigration.
Last week, a disagreement between two conservative think tanks erupted when the Heritage Foundation excoriated the immigration reform proposed by a bipartisan group of eight senators. Heritage's analysis argues that making 11 million illegal immigrants eligible, more than a decade from now, for welfare-state entitlements would have net costs of $6.3 trillion over the next 50 years.
Fifty-year projections are not worth the paper they should never have been printed on - think of what 1963 did not know about 2013. Why, then, the 50-year time horizon? Because 50 years of any significant expenditure is an attention-getting number. And because for more than a decade legalized immigrants would be a net fiscal plus, paying taxes but not receiving benefits.
The Cato Institute says Heritage insufficiently acknowledges immigration's contributions to economic growth (new businesses, replenishing the workforce, etc.). This dynamism, Cato argues, will propel immigrants' upward mobility, reducing the number eligible for means-tested entitlements.
Conservatives correctly criticize those who reject "dynamic scoring" of tax cuts. Such a calculation of the revenue effects of cuts includes assumptions about the effect on economic growth from changed behavior in response to the cuts - especially increased investment and consumption. Opponents of dynamic scoring usually are opponents of tax cuts. Similarly, opponents of increased immigration downplay what Cato stresses - immigration's energizing effects.
Which brings us to Dickens' revolt against Thomas Malthus' precapitalist pessimism about the possibility of growth and abundance. A Christmas Carol expresses Dickens' modernist rejection of Malthus' theory that population always grows faster than the food supply, so the poor must always be numerous and miserable.
When told that many of the poor "would rather die" than go to the workhouse, Scrooge replies: "If they would rather die, they had better do it, and decrease the surplus population." But when Scrooge recognizes that Tiny Tim might be part of this surplus, he repents, giving Tim's father a raise and a Christmas turkey. This was Dickens' representation of the triumph of economics over fatalism about social stasis.
Sentimental? Certainly. But also expressive of the 19th century's revolution of expectations. As Sylvia Nasar says in Grand Pursuit: The Story of Economic Genius, the second half of the 19th century saw "one of the most radical discoveries of all time," the recognition that mankind's "circumstances were not predetermined, immutable, or utterly impervious to human intervention." This called for "cheer and activity rather than pessimism and resignation."
Unfortunately, today's immigration debate occurs during an uncharacteristic American mood of pessimism. Next month, the anemic recovery from the Great Recession will be four years old, and many Americans seem resigned to slow growth, sluggish job creation, and stalled social mobility. Hence their forebodings about immigration.
Economic facts matter. But the material ascent of humanity since the 19th century demonstrates that economic facts are not constants, like the law of gravity. Rather, they can respond to induced dynamism, as from immigration.
America is, however, more than an economy; it also is a civic culture. Today's entitlement state may or may not be a powerful magnet for immigration; it certainly changes the context of immigration. Furthermore, European immigrants crossing the Atlantic experienced a "psychological guillotine" severing them from their homeland and encouraging Americanization. Crossing the Rio Grande is not a comparable prod toward assimilation. Sen. Jeff Sessions (R., Ala.) rightly warns of immigrants exerting downward pressure on wages at the bottom of America's social pyramid. And Yuval Levin, editor of National Affairs and a supporter of liberalized policy, notes: "A huge amount of American social policy is directed to reducing the number of people in our country who have low levels of skills and education, and it would be bizarre to use our immigration policy to increase that number significantly."
Complex and consequential, immigration policy should not be made hurriedly. But neither should it be made out of a fatalistic despair about economic dynamism that better immigration policies might foster.