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Border Out of Control: Flawed Policies Result from Unreliable Data

Policymakers are operating in the dark when they tackle immigration issues, a research economist from the W. P. Carey School of Business recently told a gathering of state legislators from around the country. Without accurate data, she said, reform measures will produce the same results as policies past: unintended consequences.

Missing from policy deliberations are reliable data showing how many illegal aliens are living and working in the U.S., said Dawn McLaren. Also missing: numbers that quantify the contributions made by these aliens as well as the cost of services they use. And the data gap will grow before it shrinks. Labor shortages in the U.S. will continue to draw workers from across the border -- and with the wait for certain kinds of visas 15 years long, the number of workers without visas seems destined to increase.

"The federal government has created a lovely problem for you," McLaren told the lawmakers. "Because you are working in the dark, no matter you do you may end up hurting yourself."

McLaren addressed state lawmakers from around the country at the "Changing Faces: Helping the States Meet the Challenges of Immigration" conference sponsored by the State Legislative Leaders Foundation and Arizona State University's Morrison Institute for Public Policy.

"The best you can do is take mitigating actions to minimize the negative consequences and maximize the positive ones," she said.

According to McLaren, the United States has failed to address the labor market forces leading it to produce flawed immigration policy. Some of the unintended consequences, McLaren said, include a continuation of illegal immigration and creation of black markets.

Assumption after assumption

"We have no idea how many are really here," McLaren says. "We think they are here, we think they are poor, so they must be using hospitals, so they must be costing this amount ... it's assumption after assumption after assumption."

For example, McLaren said, many cost/benefit analyses involving illegal immigrants are based on U.S. Census Bureau data. The census, however, does not collect information about a person's visa status. Instead they ask for place of birth and whether or not that person is a U.S. citizen. Researchers therefore have to make assumptions about the illegal population, some of which may be inaccurate.

"The reality is we do not know how many illegal immigrants are here in the U.S.," McLaren said. "We do know that some of the assumptions are inaccurate. For instance, a 2005 Behavior Research Center poll asked Arizonans to estimate how many workers in the state are here illegally. It turns out that Arizona residents think that 100 percent of lawn maintenance workers are illegal, and 40 percent of all private-sector employees are working illegally."

"That is a surprising proportion given that even the largest estimates of the number of illegal aliens in the United States is less than 5 percent of the population," McLaren added.

McLaren cautioned that "you will find stakeholders on both sides who will manipulate the data to their own end. Both sides -- the heavily anti-immigrant faction and the pro-immigrant activists -- have a stake in painting a certain picture."

If you build it, they will come

It's an economic equation that leads to immigration. The U.S. has a shortage of young and unskilled laborers to fill service industry, agriculture, construction and other low-wage jobs, McLaren said. Mexico has a large supply of young, willing workers, and the availability of jobs caused by the U.S. labor shortage draws them across the border.

McLaren explained that when the U.S. last faced a shortage of young workers the federal government reacted by instituting the Bracero Program. From 1942 to 1964 Mexican workers were permitted to accept temporary work in the United States. American companies, mostly agricultural, hired more than 4.5 million Mexicans, who followed an established migratory pattern: coming to the U.S. for work, returning home, and coming back again to work during certain times of the year.

"During the current labor shortage, however, no change in immigration policy has been made. One result as been a large number of illegal immigrants meeting the demand for labor from U.S. employers," McLaren writes. "Had the United States modified its immigration policy to reflect the increased need for labor by American companies, the issue of illegal immigration would have been avoided."

Unintended consequences

The North American Free Trade Agreement (NAFTA), the Immigration Reform and Control Act (IRCA), state laws restricting driver licenses and even increased border security all have had unintended consequences for illegal immigration.

For example, the original NAFTA agreement required that maquiladoras be located within 75 miles of the U.S. border created a population shift in Mexico as workers moved north for jobs. "When some of the companies moved operations to China, suddenly there was a large number of unemployed people right on the border -- looking across at opportunity in the U.S.," McLaren said.

Another example: Since 1986 employers have been required to get certain documents from workers to verify their immigration status. "This spawned an industry servicing the market for false green cards and Social Security cards," McLaren said.

Yet another unintended consequence: Years ago, Mexicans paid around $300 to $500 to illegally cross the U.S. border. Increased security drove the cost up to close to $2,000 and has made a quick dash through an urban neighborhood into a dangerous trek across the desert.

"Because the initial cost is now so high, crossers will give the smuggler a down payment, with the remaining cost to be paid from wages earned in the U.S.," McLaren said. "This establishes a continuing tie between the smuggler and the smuggled, leading to opportunities for extortion and hostage-taking."

And on the state level: Preventing illegal aliens from obtaining driver licenses prevents them from getting auto insurance and buying vehicles on the legitimate market. "The consequence is that we have more uninsured divers on the road and everybody else's premiums go up."

McLaren points out that these measures, enacted in an effort to resolve problems, have instead created others. "On the one hand, we do not want to reward them for coming here illegally, but on the other hand we want them to function as normally in our society as possible, because if we don't we will have increasing costs."