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By Philippe Legrain 4 COMMENTS

The Financial Times review of Immigrants is very positive too.

New arrivals and new prosperity

This persuasive text argues that open borders benefit both immigrants and their host countries, writes Stefan Wagstyl

Poles in Britain. Turks in Germany. Mexicans in the US. Filipinos in Japan. Immigration is among the most sensitive political issues. Rapid economic globalisation in the past 30 years, weakening of border controls following the collapse of the communist bloc and the spread of low-cost international communications have stimulated unprecedented waves of movement.

For natives, immigrants have long been a source of suspicion. Once they were accused of starting fires and stealing children. Today they are linked with everything from welfare scrounging to Islamic terrorism.

In the past such fears have proved groundless. Immigrants have enriched themselves and countries where they have settled. While the scale of today’s migration raises global as well as national challenges, history suggests it will benefit both the world’s migrants and their often reluctant hosts.

I should at this point declare an interest. My parents were Polish refugees who settled in the UK following the second world war. Britain gave them a home and an education – debts later repaid through decades of professional and charitable work.

But the case for immigration does not need to be based on personal anecdote. It is grounded in hard economic fact, as Philippe Legrain shows in Immigrants – a passionate and cogent plea for liberalising migration.

Workers raise their own – and the world’s – income levels by moving from a low-productivity job in a poor country to more productive employment in a rich one. They gain because they earn more; the host country gains because migrants spend money and create jobs; and the countries they left usually gain because migrants send money back to their families.

Legrain marshals a formidable volume of academic evidence, including one calculation that liberalising migration could double global output. He dismisses fears that immigrants steal jobs from natives, arguing that they are often employed in work that is too dirty, arduous or dull to attract locals.

At times he overstates his case. He cites the example of Israel, where an immigration wave from the collapsing Soviet Union in 1989-91 pushed down male wages by 5 per cent. Pay rates did not recover until 1997. Legrain argues that, as the immigrants stimulatedeconomic growth by prompting a housing boom, the overall economic impact was positive. This may be true. But presumably those workers whose pay rates fell did not think so at the time. Nor could they have known their incomes would later recover.

The general point is that even if economies and populations as a whole benefit from immigration, certain groups of workers can lose out. The winners may outnumber the losers, but the losers must not be ignored.

Legrain is right to say migration cannot be stopped. Only totalitarian states have managed to control migrants. Even today’s limited restrictions result in hundreds of deaths a year among people crossing the deserts of the US-Mexican border and sailing the Mediterranean in overloaded boats.

In Legrain’s view the best policy would be open borders – failing that, immigration taxes, to be paid either by immigrants or their employers. These are interesting ideas, but there is not enough discussion about how they might work in practice.

Legrain also tackles the thorny question of immigration and social cohesion. He dismisses arguments that the growing diversity created by immigration undermines cohesion and with it support for a generous welfare state. He gives the examples of London and New York – two very diverse cities with stronger support for social transfers than in the less diverse populations of Britain and the US as a whole.

Legrain defends multiculturalism, arguing that people should have the freedom to operate in their own cultures and languages. Citizens should be required to support "core values" such as liberty, equality and tolerance. But these should not extend to any obligation to acknowledge the primacy of native historic traditions such as European states’ Christian heritage. Integration is a two-way street.

It is a compelling view. However, he pays too little attention to the political importance of those natives who are suspicious of immigration. Policymakers must take account of the many voters who disagree with Legrain, even if this is based on ignorance and prejudice. It is surely better to admit 500,000 immigrants annually and have social peace than 1m and riots.

Also, while market economies may adjust easily to migrant flows, bureaucracies do not. The authorities need time and money to provide increased public services. Even if the young adults who dominate migrant flows do not immediately want schools and hospitals, they do require public transport. It is not enough to say, as Legrain does, that immigrants pay their fair share of taxes. Voters must see governments spending this money.

Legrain’s book would be clearer if he illustrated his points with charts. It is a feat to write more than 300 pages on such a number-rich subject without a single graphic. But there is no doubting the cogency of his arguments.

Copyright The Financial Times Limited 2007

Posted 17 Jan 2007 in Blog
  1. Does he discuss the effects of emigration of a country’s best and brightest?

  2. Philippe Legrain says:


  3. RichB says:

    At best, citing Israel in the 90’s as a study of the impact of massive immigration on low skilled labor is disingenuous. The analysis in the book doesn’t mention that at the same time immigration increased from the former Soviet Union, Israel lost or closed off access to its previous main source of low cost labor — Palestinians living in Gaza or the West Bank. As most residents of the West Bank and Gaza have seen their standard of living plummet since the mid 90’s, including the impact on Palestinians would have given a much more negative outcome for the analysis. Certainly immigration to Israel hasn’t caused all of the problems of the Palestinians, but Israel in the 90’s is hardly a good case study and leaving out the Palestinian impact is quite misleading.

  4. Peter Kaye says:

    This is a typical narrow opinion of the formally educated, especially economists. Looking at it from the from the Australian perspective it is no coincidence that the main population is living along a narrow strip along the coasts. This is where water can be obtained to sustain live. Does he think future migrants bring their own water with them? At the moment Sydney’s water storage is less than 37%, Brisbane is less than 20%, we had a drought for 6 years and it doesn’t look like we will get enough rain to fill the dams. Australia is overpopulated as it is and we don’t need any more migrants. There have been plenty of economists who screwed things up because they look at theories instead of employing common sense which is in very short supply nowadays.

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