Eric Ruark's picture


  by  Eric Ruark

Robert B. Reich, who served as Secretary of Labor during President Clinton’s first term, has released a video for in which he claims to debunk four “lies” about immigration. Reich’s effort is the worst example of pure political hackery. He simply invents “facts” and tries to convince the viewer of their veracity by looking earnestly at the camera. Reich doesn’t provide any evidence, nor does he come up with any novel argument – it is doubtful he even believes what he is saying – and his so-called facts are easily refutable. But the video is interesting in that much of it contradicts his previously stated views on immigration and economic policy.

Reich’s “Fact” One: "Immigrants do not take away jobs from American workers, but instead add to demand and increase jobs.”

Reich is borrowing the rhetoric of the U.S. Chamber of Commerce, and the alliance of big business and professional politicians, whose economic policies have come to be known as “Crony Capitalism.” Reich has presented himself over the years as an enemy of this type of political economy, but he is reciting chapter and verse from the crony capitalist’s handbook when it comes to immigration. He relies on economic arguments that avoid the actual facts of the U.S. labor market in order to claim that immigrants only do jobs that Americans will not or can not do. He also says that that adding foreign workers “grows the economy,” which creates more jobs for American workers.

It is true that immigration increases the size of the economy, but that growth doesn’t equate to increased benefits for most Americans. What Reich is arguing is that growth makes something better simply by virtue of that something getting bigger (an ironic argument for Reich to be making). However, saying someone is six feet tall doesn’t mean that person is healthier, or smarter, or "better" than someone 4" 11". So, too, saying that immigration makes the U.S. economy larger than it would have been otherwise doesn’t mean that additional growth has benefited the American people. It all depends on how the economy grows.

If we look back over the past 30 years, increased immigration has directly corresponded with wage stagnation, a decrease in employed American workers, and an increase in poverty rates. The reason is that under our current system the economic gains created by immigration go to immigrants and the employers of immigrants, while the American worker and taxpayer are cut out of the equation.

Reich’s “Fact” Two: "Immigration is essential to the retirement system"

Reich is correct that the American population is aging, an inevitable result of the Baby Boom and the large influx of immigrants over the past 40 years. Reich seems unable to grasp the concept that immigrants age, too, or that in order to prevent the average age in the United States from increasing we would need to increase immigration fifteen times its current level. The fact is that our immigration system adds a lot of low-skilled immigrants who will take out far more than they ever pay into Social Security. Reich claims that adding more immigrants will have a positive effect on the Social Security Trust Fund, but he ignores that this benefit is negligible in the short-term and will only exacerbate the funding problem in the long-term.

Reich claims that the worker to dependent ratio, if it follows past trends, will become unsustainable. But older workers are working longer than ever before, some because they can’t afford to retire, and others because they are living longer and want to continue working. Changing demographic circumstances necessitate new approaches to dealing with those realities, and no reputable economist has endorsed mass immigration as a way to “fix” Social Security. It just isn’t plausible.

Reich’s “Fact” Three: "Immigrants pay taxes"

This is true in the same way as Reich’s first point that “immigration grows the economy.” Of course immigrants pay taxes. No one disputes that, but what really matters is whether, on average, immigrants pay more in taxes than they receive in government services. For high-skilled immigrants the answer is generally “yes,” though this leaves out the question of the costs associated with displaced skilled American workers. For legal immigrants, the answer is increasingly “no,” as 49 percent of households headed by a legal immigrant now use welfare. For illegal aliens that answer is a resounding “no.”

Reich mentions one report by the Institute on Taxation and Economic Policy (ITEP). It is clear Reich is not familiar with ITEP’s findings, or does not want the viewer to be familiar with them. ITEP estimated how much illegal aliens, not immigrants, pay in taxes and then estimated how much more they would pay if they were amnestied. ITEP’s estimates were very generous to say the least. While these estimates conceivably could be true, they are extremely unlikely. Relevant here, however, is that ITEP admitted that it did not examine how much is spent on “social services or other benefits for undocumented workers.” If that is taken into account, illegal aliens receive about ten times more in benefits than they pay in taxes. Even Paul Krugman admits that “low-skill immigrants don’t pay enough taxes to cover the cost of the benefits they receive.”

Reich’s “Fact” Four: “The net rate of illegal immigration into the U.S. is less than zero”

This last rebuttal is bizarre in that Reich begins by saying it is a myth that legal immigration is increasing, yet he then only discusses illegal immigration. It is a fact that the level of immigration to the United States over the last decade is higher than any other ten-year period in our nation’s history. It is also true that the Gang of Eight bill, which Reich supported, would have doubled annual admissions.

It’s not surprising that Reich immediately dropped the subject of how high legal immigration actually is, but even his claim on illegal immigration is outdated and ignores data from DHS and independent demographers, which show that the illegal alien population decreased by about a million from its all-time high of 12.2 million following the recession in 2007-2009 (which means illegal aliens do self-deport). As the economy began to improve starting in 2009, illegal immigration rebounded and the illegal alien population is now showing signs of a slight increase. At most, Reich could say that the illegal alien population has remained statistically unchanged since 2009, according to best estimates. But these estimates have yet to account for the surges we have seen over the last two years, when the Obama Administration actually assisted illegal aliens in crossing the border and establishing residency in the United States. If what Reich says were true, then the illegal alien population would be continuing to show a decline. That isn’t the case, and once new estimates are released, Reich will likely ignore that the number has gone up.

Watching the video, one gets the impression that, for Reich, the American worker is nothing more than an inanimate object, a stick figure drawn on his giant note pad that can be easily discarded once he has made his point. One can only speculate what is motivating Reich’s full-throated defense of those he readily admits “have rigged the economy.” What is genuinely disappointing is that he hasn’t always shilled for open borders. In fact, in the past, his stated views were very different when it came to the merits of “growth”, the effect of immigration on American workers, and the need for enforcement against illegal immigration.

“It should be noted that the term ‘labor shortage’ rarely means that workers cannot be found at any price. Its real meaning is that desired workers cannot be found at the price that employers and customers wish to pay.”
– Robert B. Reich, The Work of Nations, 1992, p. 286

“If we have economic growth and most Americans don’t enjoy it, we're not succeeding as an economy.”
– “Reich, Redefining “Competitiveness,” The Washington Post, September 24, 1994

“Productivity improvements are going into corporate profits, not workers’ pockets.”

- “U.S. Finds Productivity, But Not Pay, Is Rising,” The Washington Post, July 26, 1995

“[Because of illegal immigration] We are witnessing the development of a third-world economy – both workers and employers – in the very midst of the first-world.”
- “U.S. Targets ‘Slave Labor’ Sweat Shop,” The Washington Post, August 16, 1995

“Hiring foreign over domestic workers should be the rare exception, not the rule.”
- “White Collar Visa: Importing Needed Skills of Cheap Labor,” The Washington Post, October 21, 1995

“Regardless of how you come out on legalizing undocumented workers, this plan will surely mean fewer jobs for some Americans.”
– “It’s Still Jobs, Stupid," The American Prospect, January 14, 2004

“A key means of reducing illegal immigration is to fully enforce our labor laws. After all, the main reason American businesses hire undocumented workers is these workers don't complain about being paid less than the minimum wage, or not being paid at all, or subjected to unsafe and unsanitary working conditions, or treated brutally, or working more than 40 hours a week without getting overtime pay. If labor protections were strictly enforced and employers faced large penalties for violating them, as well as for hiring undocumented workers, the U.S. would cease to be a magnet for undocumented workers.”
- Robert B. Reich, Facebook, November 15, 2014

ERIC RUARK is the Director of Research for NumbersUSA

taxpayer costs
Illegal Immigration

Updated: Wed, Jul 5th 2017 @ 4:05pm EDT

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