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By Philippe Legrain 1 COMMENT

Martin Wolf has written a thoughtful column on immigration in today’s FT. He very kindly describes my new book, Immigrants: Your Country Needs Them, as "thought-provoking", adding that:

Mr Legrain performs an invaluable
service: he makes a good case for the unpopular cause of free flows of
people. The book is a superb combination of direct reportage with
detailed analysis of the evidence.

Immigration policy must be a compromise

What are the benefits and costs of a diverse population? How should a liberal democracy define the limits of multiculturalism? In answering these questions, the high-income countries will also define what kind of society they wish to be in the 21st century.

As the World Bank’s latest Economic Prospects report makes clear, the pressure for migration from poor to rich countries is a permanent feature of our integrating world.* The share of migrants in the populations of the high-income countries rose from 4.4 per cent in 1960 to 11.4 per cent in 2005. It seems certain to rise still further, given both demographic trends and the persistent gaps in incomes and wages between developing and high-income countries.

A vigorous and often ill-tempered debate has opened over the consequences of this movement of people. In a thought-provoking new book, Philippe Legrain, the British author of Open World, a splendid work on globalisation, takes a bold position: let them all in.** More precisely he says: “It would be best if our borders were completely open. But if that is deemed impossible for now, let them at least be more open. And if even that is not acceptable, let them at least be better regulated.”

Mr Legrain performs an invaluable service: he makes a good case for the unpopular cause of free flows of people. The book is a superb combination of direct reportage with detailed analysis of the evidence.

What I find missing, however, is analysis of what might happen if no restrictions were indeed placed on the movement of people. Basic theory suggests that the flow of migrants to a place where there is a chance of obtaining a far better income might continue until the wages to which the migrants aspire have fallen to the same level as at home (after adjustment for the costs both of moving and of living). Alternatively, it would continue until the condition of many of them has become even worse than at home. We would then see in the developed world what we see in developing countries: vast slums.

No high-income country is going to allow this to happen. For this reason some controls will remain in place. Moreover, such controls are effective, even if porous. The gaps in wages across the globe to which Mr Legrain points in arguing the economic benefits of free flows also demonstrate the efficacy of controls. Making migration both costly and unpleasant works. But those costs are indeed enormous, as is always the case when market forces are driven underground.

We must also recognise that, as Mr Legrain argues, migration does bring large benefits. The biggest aggregate global gains come from moving people out of bad environments into good ones. But the biggest gains to recipient countries, I suggest, come from greater diversity itself.

Mr Legrain quotes Richard Florida of George Mason University: “Regional economic growth is powered by creative people, who prefer places that are diverse, tolerant and open to new ideas.” A quarter of the people now working in London were born abroad. It would be nothing like as prosperous or as exciting a place without them.

Yet the diversity that creates such benefits brings with it the biggest of all challenges: sustaining the institutions that are the source of a liberal democracy’s attraction.

To his credit, Tony Blair, the British prime minister, did a good job of defining the necessary limits of diversity in an important speech: “When it comes to our essential values – belief in democracy, the rule of law, tolerance, equal treatment for all, respect for this country and its shared heritage – then that is where we come together, it is what we hold in common; it is what gives us the right to call ourselves British. At that point no distinctive culture or religion supersedes our duty to be part of an integrated UK.”

Toleration of the intolerant must cease where the latter threatens the sustainability of the diverse society itself. Whether it will be possible to achieve this in today’s circumstances is unclear. But there is no doubt about the importance of trying.

In addition to maintaining the very qualities that made it a magnet in the first place, a society must decide how to control the inflow. Mr Legrain makes a compelling case against the inflexibility of “picking winners” in immigration. My own view has long been that work permits should be auctioned, with the price giving guidance on how many people should be let in. When people are let in, it is also right to help them obtain what is needed to participate in a liberal democracy: above all, the dominant language and some understanding of its institutions and history.

Mr Legrain is right on two big points: migration cannot be stopped; and it can indeed bring benefits to almost everyone. But it also poses a bigger challenge than he admits. The answer, I believe, is twofold: controlling the borders, however imperfectly; and, still more, insisting on the core values of the host society. The results will be imperfect. But the alternatives of either complete freedom of movement or a fortress are both impossible. What we are left with is the ancient art of compromise.

Posted 22 Dec 2006 in Blog
  1. Per Kurowski says:

    Should we let the market really work on the migration flows?
    Sir, I subscribe almost entirely to Martin Wolf’s “Why immigration policy must be a compromise”, December 22, and the almost is there as I find it hard to understand how his view “that work permits should be auctioned” to the best bidder is related to a “compromise”. Will the one offering the most for the work permit be the best worker or is he just the one needing or capable of paying the most for a shelter?
    If Wolf really believes that the market mechanism should be used to optimize migration flows then anyone wanting to move out of his country should also have the right to sell his “place” in the market. We could thereby create some real incentives for people to sell an expensive UK residence right and buying themselves a dirt-cheap Tanzania one, with view of making a huge capital gain when this last poor country gets developed.
    In the debate on immigration we must never forget that no matter how much we take shelter behind reinforced borders, at the end of the day, we are all still living, ever more cramped, on the very small planet earth.

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