CIAO DATE: 3/00
U.S. Immigration Policy: Unilateral and Cooperative Responses to Undocumented Immigration 1
International Studies Association
41st Annual Convention
Los Angeles, CA
March 14-18, 2000
The I.N.S. estimates that over five million undocumented immigrants currently reside in the United States, 2.7 million from Mexico alone. U.S. immigration policy regarding undocumented immigration focuses overwhelmingly on deterring Mexicans at the border with the goals of cutting down on undocumented immigration, protecting U.S. workers, and still guaranteeing a sufficient supply of unskilled labor. The current policy regime has been an expensive failure. In this paper, I describe the current approach and three alternatives (guestworker reform pending in Congress, a strict control policy, and a cooperative bilateral approach). For each alternative, I analyze the likely outcomes and the distributional consequences for seven types of economic actors. I conclude that a bilateral approach to immigration control (a North American Common Market) would be most efficient and would benefit the most actors, and I discuss the political feasibility of such an option.
Paper prepared for delivery at the annual meeting of the International Studies Association, March 14-18, Los Angeles, CA.
First draft; please contact author at email@example.com with comments and before citing.
This paper addresses the problem of undocumented immigration to the United States from Mexico, and current and proposed policies designed to control these undocumented flows. Undocumented migration from Mexico is a subject which already receives disproportionate attention in the sense that many—and probably most—undocumented immigrants in the United States do not illegally cross the U.S.-Mexican border, yet I.N.S. enforcement efforts focus overwhelmingly on these border crossers. Although undocumented Mexican migration to the United States has received disproportionate attention, the subject merits analytical attention for at least three reasons. First, undocumented immigration from Mexico to the United States is still the single largest illicit migration flow in the world, at about one million immigrants per year. Second, partly for this reason, U.S. enforcement efforts devoted to controlling Mexican immigration in particular cost taxpayers billions of dollars, and have resulted in the transformation of the I.N.S. into the largest civilian gun-carrying force in the world. And third, Mexico-U.S. immigration remains central to U.S.-Mexican bilateral relations (Binational Commission 1997, Perez-Godoy 1999, Rico 1992, Rosenblum 1998); and U.S. immigration policy-making takes on an increasingly transnational character (Rosenblum 1999, Rosenblum 2000).
Yet despite the U.S. commitment to NAFTA and President Bill Clinton’s commitment to expand free trade throughout the Western Hemisphere by the year 2005, there has been only a limited effort to explicitly address Mexico-U.S. immigration within the context of the deepening bilateral relationship. 2 The failure to pursue bilateral immigration policy options is ironic in light of other linkages being made between economic integration and immigration in the EU and, to a limited extent, in the case of U.S.-Caribbean Basin relations (Rosenblum 1999, Rosenblum 2000). The failure to seek to address immigration through a bilateral approach is also ironic given that efforts at bilateralism have been successful in the past, including during the early years of the U.S.-Mexico bracero program (Craig 1971, McCain 1970, Rosenblum 2000).
In this paper, I summarize the current U.S. immigration policy toward undocumented Mexican immigration, which has been an expensive failure. I then take up three competing policy proposals: one pending in the U.S. Senate (S.1814 and S.1815) to expand the H-2A guest-worker program, one to construct a strict enforcement regime, and one based on linking U.S.-Mexican free trade to a free flow of labor, thus making NAFTA a common market. For each alternative, I make predictions about likely outcomes and the distributional consequences for seven types of actors (U.S. workers, U.S. consumers, U.S. employers, other U.S. citizens, undocumented immigrants, legal immigrants, and other Mexicans). I conclude that a binational approach to immigration control (a North American Common Market) is the most promising option, and I discuss the political feasibility of this option.
2. The Current Undocumented Immigration Policy Regime
Since the late 1970s, U.S. immigration policy has made its highest priority the reduction of undocumented immigration across the U.S.-Mexican border. The goals established by the 1981 U.S. Select Commission on Immigration and Refugee Policy (SCIRP) and reflected in congressional debate are to limit illegal inflows, protect U.S. jobs, and insure that employers have sufficient access to unskilled labor.
2.1 Summary of Current Policy
The current U.S. policy regime employs four approaches to deter undocumented immigration from Mexico: border enforcement, employer sanctions, a limited agricultural guestworker program, and limits on social programs for undocumented migrants.
2.1.1 Border Enforcement and Removal of Immigrants
Since the mid-1970s, the United States has engaged in what Dunn (1996) describes as low intensity conflict, expanding border enforcement in three separate stages. The first stage began in 1978, when Congress responded to rising undocumented immigration (see table one) by increasing I.N.S. funding by 24 percent between 1978 and 1980 (see table two), with most of the new resources going to increases in equipment and hardware. While President Jimmy Carter was reluctant to aggressively expand actual border enforcement efforts, 3 “the expansion of the I.N.S. was taken to an unprecedented level during the Reagan administration, as the urgency surrounding immigration and ‘border security’ topics became even greater during this period” (Dunn 1996, 41). Over the course of the Reagan administration, congressional funding for the I.N.S. increased by 130 percent, and staffing increased by 41 percent to 15,453 positions, mostlyu devoted to enforcement (see table two). Congress’ passage of the 1986 Immigration Reform and Control Act (IRCA) initiated the second stage of enhanced border enforcement as funding was increased again by a third between 1986 and 1988, and as Congress strengthened penalties against migrant smugglers. The third stage began in 1994 when the Justice Department and I.N.S. initiated a program of “prevention through deterrence” designed to “make is so difficult to enter this country illegally that fewer individuals would even try” (GAO 1999, 3). The strategy sought to close off the most commonly used routes (through border cities) and shift traffic through ports of entry and into remote (desert) areas where enforcement agents would have an advantage. Border escalation was endorsed by Congress in 1996 with the passage of the Illegal Immigrant Responsibility and Immigration Reform Act (IIRIRA) in which authorized funding for 1,000 new Border Patrol agents and 300 new support staff each year for five years. The number of agents along the southwest border had increased from 3,389 in October 1993 to 7,357 in September, 1998. The IIRIRA also streamlined exclusion and deportations procedures, making it easier for aliens to be deemed inadmissible and removed without a hearing, and shortening hearing procedures for removal (formerly deportation) proceedings.
2.1.2 Employer Sanctions
The 1986 IRCA included a provision making it illegal to employ undocumented immigrants, establishing civil penalties for first time offenders and criminal penalties for employers who display a pattern of violating the policy. 4 While IRCA responded to long-standing calls for employer sanctions, the legislation was problematic, as several analysts have noted (e.g., Calavita 1994, D. Martin 1994, Fix 1991). IRCA made it illegal to “knowingly” hire an undocumented immigrant, but failed to establish a reliable procedure for determining migrants’ work eligibility. Instead, IRCA required employers to fill out an “I-9” form which documents that prospective employees presented two or three of 25 possible forms of identification, making it difficult for well-intentioned employers to insure that the documents were legitimate, and easy for others to plausibly deny knowledge of their employment violation. Moreover, the bill included a number of features which guaranteed it would not be enforced aggressively, including the requirement that I.N.S. officials obtain search warrants before inspecting agricultural worksites, and the dedication of limited funds to worksite inspections. With the passage of the IIRIRA in 1996, some of these enforcement problems were addressed through the creation of employment verification pilot programs to allow employers to verify citizenship status; but the programs are narrow in scope and have received limited support.
2.1.3 Agricultural Guestworker Program
The IRCA combined the “stick” of increased border enforcement and employer sanctions with the “carrot” of the H-2A agricultural guestworker program. 5 The H-2A program is modeled on the bracero guestworker program as it existed after 1954, and is designed to insure that agricultural employers have adequate access to labor without damaging the employment prospects of U.S. workers. Under the program, employers may apply to the Department of Labor (DOL) to receive guestworkers; the DOL must first certify that a labor shortage exists and that wages and working conditions for domestic farmworkers would not be “adversely affected” by importing guestworkers. Then the DOL also certifies that adequate housing is available for guestworkers, and the employer applies to the I.N.S. for approval to recruit employees, a step which is usually pro forma , but time-consuming. Finally, up to 60 days after the initial paperwork is filed, H-2A workers are made available to agricultural employers.
2.1.4 Denying Access to Social Programs
Finally, in 1996, Congress passed the IIRIRA, the centerpiece of which was to deny immigrants—including legal immigrants—access to a variety of social welfare programs. Undocumented immigrants were denied access to Social Security benefits, subsidized housing assistance, and food stamps. Legal immigration was restricted by raising the minimum household level for sponsors of immigrants to 125 percent of the poverty rate, and holding sponsors accountable before sponsored immigrants gain access to means-tested benefits.
2.2 Effectiveness of Current Policy Regime
By almost any measure, the current policy regime must be regarded as a complete failure; in this section I analyze the extent to which current policies meet their stated goals.
2.2.1 Deterrence of Undocumented Immigration
The enhancement and expansion of immigration enforcement since the 1970s has been accompanied by an increasein the estimated number of undocumented immigrants from slightly over one million when the current policy regime was initiated, almost all of whom were from Mexico, to approximately 5,000,000 as of 1995, about 2.7 million from Mexico. While it is impossible to estimate what the number of undocumented immigrants would have been in the absence of recent enforcement efforts, several characteristics of the existing policy regime seem to predict its failure.
By concentrating overwhelmingly on the U.S.-Mexican border, the current regime fails to address the underlying causes of undocumented migration, and it fails to provide a comprehensive deterrent to undocumented immigration. There is widespread agreement among academics that immigration (legal and undocumented) is a function of three types of forces: economic “pushes” which encourage people to leave their home countries, economic “pulls” which attract the to a destination, and “social networks” which facilitate flows to a particular destination (see e.g., Binational Commission 1997, Massey et al. 1993, Massey et al. 1994, Stalker 1994). Official U.S. policy attempts—in theory—to address only one of these three motivations for immigration, by reducing pull factors through the imposition of employer sanctions since 1986, and through the reduction in benefits to undocumented immigrants through the 1996 IIRIRA, and to raise the cost of migrating at the border; but these policies fail to actually deter migration for three reasons.
First, employer sanctions legislation fails to deter would-be immigrants because so few resources are devoted to worksite enforcement. Between 1986 and 1997, the Border Patrol was responsible for between 92 and 97 percent of all I.N.S. apprehensions; and 97 percent of the Border Patrol’s efforts are concentrated at the U.S.-Mexican border (GAO 1997). In 1997, 7,537 workplace inspections occurred, which was an all-time high (GAO 1997), but which still represented only about one for every seven hundred estimated undocumented immigrants. Since worksite enforcement peaked in 1997, the I.N.S. has explicitly adopted a strategy of abandoning worksite enforcement: “‘It is just the market at work, drawing people to jobs, and the I.N.S. has chosen to concentrate its actions on aliens who are a danger to the community’” (Uchitelle 2000, quoting I.N.S. Associate Commissioner Robert Bach). Moreover, even when inspections are made, the structure of the I-9 form makes it notoriously difficult for the I.N.S. to prosecute employers, who therefore still have an incentive to hire additional undocumented workers. As a result, study after study indicates that the imposition of employer sanctions has had little effect on the ability of undocumented immigrants to obtain employment in the United States (see e.g., Cornelius 1998, Fix 1991).
Second, recent efforts to eliminate immigration pulls have focused on a “social service magnet” which probably does not exist. There is no evidence that any significant number of undocumented immigrants are motivated, even in part, by the existence of social benefits in the United States. On the contrary, immigrants consistently identify their desire to find employment as their primary motivation for migration (Cornelius 1998, Massey et al. 1993 and 1994). Moreover, as Marcelli and Heer (1998) demonstrate, when controlling for race and class, undocumented immigrants are less likely to take advantage of social services available to them than are natives.
While immigration enforcement efforts have, therefore, had little impact on immigration pulls, the primary policy focus has been on raising the cost of immigrating at the U.S.-Mexican border. On this front, the preliminary data suggest that the I.N.S.’ predictions about the immediate effects of the program are being borne out; but these changes appear to have had little effect on migration flows. First, the most readily-observable outcome of the build-up in enforcement activities has been a shift in the flow of illegal alien traffic from the more heavily-guarded sectors to less guarded rural areas. According to the most recent figures, apprehensions in San Diego and El Paso, traditionally the sectors accounting for the greatest number of undocumented entries, dropped from 408,265 in fiscal year 1997 to 373,127 in FY1998; and as a percentage of all apprehensions, these two sectors decreased from 68 percent in FY1993 to just 24 percent in 1998 (GAO 1999, 20). Second, also as expected, a growing number of immigrants are being apprehended at ports of entry using fraudulent documents. Third, there is extensive anecdotal evidence that fees charged by immigrant smugglers, or coyotes, have increased since the onset of the enhance border enforcement program (GAO 1999, 23). In sum, all three of these observations indicate that the cost of entering the United States illegally across the U.S.-Mexican border has increased in response to enforcement efforts.
However, there is no indication that the cost of undocumented entry outweighs the expected benefits of migration for most migrants. Indeed, the fact that total apprehensions along the southwest Border Patrol remains near historic highs (see table one) suggests that the overall expansion in enforcement has had little effect. Rather, it appears that immigrants have been “squeezed” to different parts of the border (GAO 1999, Dillon 2000), and that the deterrent effect of increased border enforcement anticipated by the I.N.S. has, thus far, failed to materialize. Moreover, according to the I.N.S.’ own estimates, roughly one half of all undocumented immigrants overstay their visas, and so never cross the U.S.-Mexican border illegally; the current enforcement regime makes no effort to deter these immigrants.
2.2.2 Effects on U.S. Jobs
The second goal of U.S. immigration policy is to protect U.S. workers from excessive competition. Assessing the effects of policies on U.S. jobs actually entails asking two questions: first, to what extent do undocumented migrants take jobs which would otherwise be held by native U.S. workers (or legal immigrants); and second, to what extent do undocumented migrants depress wages for natives and legal immigrants? Both of these questions have been analyzed extensively (e.g., Smith and Edmonston 1997, McCarthy and Vernez 1998), and the general conclusion is that employer sanctions and border deterrence policies have done little or nothing to limit the availability of immigrants to employers or the availability of jobs for immigrants. Rather, consistent with dual labor market theories, the majority of recent immigrants, and especially the majority of undocumented immigrants, are employed in sectors of the economy which are shunned by native workers and long-term immigrants. 6 Regarding the effects of undocumented immigration on wages, the conventional wisdom is that immigration in general, and undocumented immigration in particular, does have a slight negative effect on wages which is felt most strongly by recent immigrants and U.S. minorities who compete with undocumented immigrants (Hamermesh and Bean 1998, Portes 1995). It is likely that negative effects are also felt up the pay scale, to a limited degree. The strongest inidictment of the current regime is the fact that organized labor, which was among the groups which worked hardest to obtain employer sanctions, has come out strongly in opposition to the policy (see below).
2.2.3 Availability of Labor
The third goal of the current regime is to guarantee sufficient unskilled labor to U.S. employers. 7 The partial failure (at least) of border enforcement and employer sanctions as a migration deterrent implies that this is met. Nonetheless, agricultural interest groups and others have complained of limited availability of low-skilled workers, so the questions merits attention.
First, there is no evidence of a labor shortage in agriculture or in other unskilled sectors of the economy. On the contrary, agriculture, the service sector, and low-skilled manufacturing have consistently displayed higher unemployment rates than other sectors of the economy. A GAO analysis of 20 large agricultural counties found that 11 out of 20 had unemployment rates double the national average, and 15 out of 20 had an unemployment rate in 1997 greater than 7.2 percent. The GAO also concluded that agricultural areas have high unemployment all year, including during peak agricultural periods (GAO 1997, 27). Moreover, while agricultural unemployment has fallen from its high of sixteen percent in 1983, the ratio of agricultural to overall unemployment remains near its post-war high of two (see figure one); so there is no agricultural labor shortage relative to the overall state of the economy. My own interviews in San Diego County also failed to find any evidence of a labor shortage among non-agricultural immigrant-dependent industries, including in the period after the initiation of San Diego’s border build-up, Operation Gatekeeper (Cornelius 1998).
Second, regarding wages, there is also little evidence that immigration restrictions have caused wages to rise, as noted above. On the contrary, U.S. Federal Reserve Chairman Alan Greenspan has argued that the wage-depression effects of legal and undocumented immigration is one of the primary factors contributing to high growth without inflation in the United States (Uchitelle 2000). Regarding agriculture, the GAO cites declining agricultural wage rates, in real terms, in the 1990s despite rising wages in other industries (GAO 1997, 28). For this reason, labor-intensive agribusiness has been highly profitable, with production increases of 52 percent in the decade following IRCA passage, and exports quadrupling to $10.6 billion (Farmworker Justice Fund 2000).
2.3 Implications of Current Policy Regime for Various Economic Groups
As noted above, the failure to control undocumented immigration has had a mild downward effect on wages, hurting U.S. workers. Ironically, employer sanctions, in particular, hurt U.S. workers. By making it illegal to work without documentation, but then failing to punish employers of undocumented immigrants. This policy combination places undocumented workers at a disadvantage in their negotiations with employers. In the extreme, employers take advantage of this asymmetry to report troublesome or pro-union employees to the I.N.S., or simply to avoid paying workers back wages (see e.g., Rosario 2000). Even when employers do not actually resort to this method, the threat of deportation limits undocumented immigrants’ labor rights. Given that unionization remains one of the best predictors of wage increases, the existence of employer sanctions contributes to the negative effects of immigration on wages.
The best argument against employer sanctions is that U.S. labor unions oppose them. Unions were at the forefront of calls for employer sanctions throughout the twentieth century (Mink 1986). But since the passage of IRCA in 1986, unions representing unskilled immigrant workers, including ACTWU (now UNITE), SEIU, and the ILGWU, have argued that sanctions fail to deter immigration but make organizing immigrants more difficult (Delgado 1993, Haus 1995). 8 The campaign by a range of immigrant-constituent unions to repeal employer sanctions expanded in the 1990s (Burn 2000, Fan 2000) as efforts by unions to organize undocumented immigrants also grew (Rosario 2000). In 1994, the California Labor Federation passed a resolution against sanctions; and, most significantly, in February, 2000, the AFL-CIO executive council supported a major overhaul of U.S. immigration policy: “Current efforts to improve immigration enforcement, while failing to stop the flow of undocumented people in to the United States, have resulted in a system that causes discrimination and leaves unpunished unscrupulous employers who exploit undocumented workers, thus denying labor rights for all workers. . . . We strongly believe employer sanctions, as a nationwide policy applied to all workplaces, has failed and should be eliminated” (see http://www.aflcio.organize/publ/estatements/feb2000/immigr.htm).
U.S. employers benefit from the large pool of labor and ability to pay low wages under the current regime and are the group most resistant to radical change in the status quo. But the current system is bad for employers in at least one respect: the system encourages employers in immigrant-dependent industries to break the law because those who prefer not to hire undocumented immigrants face a collective action problem knowing that their competitors are likely to do so. As a result, even though most employers are never punished for hiring unauthorized workers, individual employers are vulnerable to prosecution if they happen to be targeted.
U.S. consumers have unambiguously benefited from the current immigration policy regime. By failing to meaningfully control the flow of undocumented immigrants at the border or the workplace, current policy insures that the pool of unskilled labor remains large, and that prices remain low. In effect, undocumented and legal immigrants subsidize low-priced consumption in the United States by accepting low wages; and U.S. consumers pay half as much for food and other basic goods as do Europeans.
Other U.S. citizens
At the same time, the enforcement regime is costly to other citizens and residents of the United States. At the general level, the current immigration enforcement regime is expensive to maintain. Since 1976, overall and enforcement-specific I.N.S. funding has grown from $214.6 and $117.7 million, respectively, to $4.1 and $1.93 billion as of 1999 (see table two). At the same time, despite the enormous investment in the I.N.S. enforcement strategy, enforcement efforts are threatened by strained resources; I.N.S. detention centers are filled beyond capacity (Taylor 2000), and the agency suffers from morale and recruitment problems (Pan 1999, Valbrun 2000), implying that even more spending is required.
A second group of U.S. citizens and residents face more specific costs associated with the current enforcement regime: legal immigrants and U.S. citizens, especially those of Hispanic descent, who live near the U.S.-Mexican border. In particular, Hispanic Americans complain that they are frequently stopped and harassed by Border Patrol agents (Yardley 2000), and other area residents complain that I.N.S. tactics are destructive and display a disregard for private property (Ellingwood 2000, Ibarra 2000). As one Texas resident observed: “The question becomes whether the benefits of the Border Patrol doing this outweigh what I consider to be the Border Patrol violating our constitutional rights” (Yardley 2000).
As for U.S. employers, the current regime is both good and bad for undocumented Mexican immigrants. On the one hand, undocumented immigrants benefit because the current regime provides opportunities for undocumented immigrants to work. On the other hand, to the extent that U.S. enforcement agents are de facto agents of anti-union employers, the current system depresses wages for undocumented immigrants below market levels. A third problem from the perspective of undocumented immigrants is the costs associated with crossing the border: the average price paid by undocumented immigrants to coyotes, or people smugglers, has jumped from several hundred dollars in the early 1990s, to over a thousand dollars by the end of the decade. This is not a subsidy of U.S. consumers or employers, but simply a transfer from poor Mexicans to criminal networks. Far more severe is the rising cost in deaths and injuries paid by the hundreds of immigrants who try unsuccessfully to cross away from U.S. enforcement efforts.
Recent immigrants also suffer under the current regime. On a general level, legal immigrants are frequently the victims of discrimination, a fact exacerbated by harsh anti-immigrant rhetoric among policy-makers. Since 1996, the second-class status has been institutionalized through the passage of the IIRIRA, which establishes two tiers of legal residency, denying a range of social benefits even to legal U.S. residents (Schuck 1998).
Current policy provides questionable benefits to the small number of immigrants who participate in the H-2A guestworker program. While the program benefits some 15,000 Mexicans each year by affording them temporary employment in the United States, the program’s poorly designed enforcement mechanisms guarantee that many H-2A immigrants do not enjoy the wages and benefits promised them under the law. In contrast to the way the bracero guestworker program functioned between 1942 and 1954, Mexican consuls play no H-2A oversight role, so that the program relies on H-2A workers themselves to know their rights under U.S. law and to initiate formal complaints should they have reason to do so. Moreover, any complaints must be filed during the actual contract period since it is impossible for the DOL to interview workers after they have returned to Mexico. 9
Other Mexican citizens
Finally, the current U.S. immigration enforcement regime has positive and negative consequences for Mexico on economic and political levels. On an economic level, Mexico benefits enormously from migrant remittances. However, because undocumented immigrants receive below-market wages, and because there are high transaction costs associated with the transmission of remittances, these flows are lower than they “should” be. Second, there are political and diplomatic costs associated with the failure to include Mexico as a partner in immigration policy-making. At least since the debate over the 1986 IRCA, Mexican politicians have generally agreed that “migration is an international problem, and its solutions ought to be reached by the countries involved and not by the unilateral decisions of a government” (Resolution passed by the Mexican Chamber of Deputies, 1986, quoted in Glazer 1990, 17). In more recent years, Mexican politicians of the left and the right have staked out their firm opposition to U.S. restrictionism; and there is a consensus among Mexican politicians that “our number on priority . . . is to try to guarantee that while in the United States all Mexicans, regardless of their migratory status, have their rights respected” (author interview with Frederico Salas, Mexican Foreign Ministry, 6/26/98; also see Perez-Godoy 1999). The hostility among Mexicans to what is commonly perceived as the U.S. “criminalization” of immigration is equally if not more strong at the mass level as well (Rosenblum 1998).
3. Three Alternative Proposals
If the current system is broken, how should it be fixed? In this section I describe three alternative proposals: one of which is currently being debated in the U.S. Senate as bills S.1814 and S.1815 to expand and streamline the existing H-2A guestworker program, and the other two of which are at two ends of the possible spectrum of enforcement responses: a strict unilateral enforcement regime, and a cooperative market-based regime. For each of these three, I summarize the proposal, describe the likely results if implemented, and analyze how policy implementation would affect the seven groups discussed above.
3.1 Expanded H-2A Guestworker Program
3.1.1 Proposal for Guestworker Reform (Summary of S.1814 and S.1815)
In 1996, when Congress was debating the IIRIRA, several members of Congress raised concerns (as they had in 1986) that legislation would be too successful at limiting undocumented immigration and lead to an unskilled labor shortage. Three years later, S.1814 and S.1815 proposed a two-pronged program which would expand and streamline the H-2A guestworker program, and provide a limited amnesty for undocumented immigrants working in agriculture. According to the bills’ sponsor Senator Gordon Smith (R-OR), the goals of the program would be to “reform the agricultural labor market, establish and maintain immigration control, provide a legal workforce for our farmers, and restore the dignity to the lives of thousands of farmworkers who have helped make the U.S. economy the powerhouse that it is today” ( Congressional Record 1999, S13543).
S.1814 proposes to reform the H-2A program in three ways. First, the program would allow a greater number of H-2A visas to be issued and allow H-2A workers to be employed in a wider range of agricultural jobs. Second, the program would streamline the H-2A application process by limiting required employer efforts to recruit U.S. workers before resorting to H-2A recruitment, and by shortening the time frame for the DOL to respond to employer requests. Third, the proposed guestworker reforms would limit regulatory restrictions on the program by lowering wages and eliminating housing requirements.
S.1815 would complement H-2A reform by providing amnesty for certain undocumented immigrants. To qualify for immediate legal temporary status, immigrants would be required to prove that they worked in agriculture at least 150 days in the previous year. Among those obtaining temporary legal status, individuals who can prove they work in agriculture for at least 180 days in five of the following seven years will qualify for permanent legal status. Of the total number who qualify after seven years, twenty percent will be given legal permanent resident (LPR) status in each of the following five years. Once immigrants receive LPR status, their families become eligible for family-based visa waiting lists. Five years after immigrants receiving LPR status, immigrants may apply for U.S. citizenship.
3.1.2 Anticipated Effects of Guestworker Reform
The proposed guestworker reforms seem unlikely to meet their stated goals. The most important goal of the program, based on the rhetoric of its supporters, is to assure an adequate supply of farm labor. But, as noted above, there is no evidence that an agricultural labor shortage currently exists. Likewise, according to the GAO (1997, 24): “a sudden widespread farm labor shortage requiring the importation of large numbers of foreign workers is unlikely to occur in the near future.”
The guestworker reform proposal is unlikely to convince current undocumented immigrants to legalize their status because the amnesty requirements are prohibitively difficult. The informal nature of seasonal agricultural employment guarantees that relatively few migrants who worked 150 days in the previous year will be able to document their labor. Moreover, given that the average seasonal worker only works 176 days each year (Guerra 2000), it will be extremely difficult for workers to obtain 180 days of work in five out of the following seven years, much less to obtain documentation of that work. If the certainty of receiving citizenship by staying in the H-2A program seems doubtful, many workers will continue to abandon the program in favor of better wages and working conditions in other industries.
Moreover, the revised H-2A program will have even less effect on future undocumented immigration; this is especially true given that only twelve percent of undocumented immigrants work in agriculture, according to I.N.S. estimates. Thus, by expanding guestworker recruitment, but making a long-term commitment to the program unattractive to immigrants, the most likely results is that the revised H-2A program would have the same result as virtually every other guestworker program in history: a high degree of “leakage” as guestworkers leave the program to become undocumented immigrants.
The fourth stated goal of the guestworker proposal is to protect foreign and domestic workers, and “restore dignity” to their lives. Once again, it seems doubtful that the proposed program would achieve these goals. In its current form, the H-2A visa program is criticized by workers’ advocates because its weak enforcement mechanisms do little to protect wages. If the proposed revisions were to be enacted, official wage levels would fall and employers would be required to make less effort to recruit native workers before resorting to guestworkers. Thus, the proposed guestworker bill would further depress wages for immigrant and native agricultural labor.
3.1.3 Implications of S.1814 and S.1815 for Various Economic Groups
The effect on U.S. workers would be mainly limited to those workers who compete with H-2A visa-holders for agricultural jobs. These workers would face increased competition as several regulatory changes would make it easier for agricultural employers to hire guestworkers without trying to recruit U.S. workers first. 10 The revised H-2A program would maintain the current bias against U.S. workers by not requiring H-2A employers to pay social security or unemployment taxes for guestworkers. For these reasons, S.1814 and S.1815 are opposed by every agricultural and non-agricultural labor group in the country.
As strongly as U.S. workers oppose “guestworker reform,” U.S. agricultural producers favor the legislation. As Western Growers Association President David Moore explained, “it is extremely important that growers of highly perishable fruit and vegetable crops be able to harvest their crops in a timely manner” (Stockwin 1999); and the streamlined application procedure found in the proposed legislation is considered critical to making the H-2A program more attractive to growers. Thus, it is no surprise that the fourteen co-sponsors of S.1814, the bill dealing specifically with the agricultural guestworker program, received an average rating of 81.4 (out of 100) from the American Farm Bureau Federation (author’s calculation; data available at www.votesmart.org).
U.S. consumers are likely to benefit slightly from the implementation of the proposed guestworker reforms if, in fact, the legislation would lower agricultural wage rates and these savings were passed on to consumers. Agricultural wages are already lower than for any other sector of the economy, however, and it is unlikely that savings to U.S. consumers will be dramatic.
Other U.S. citizens
Given that the guestworker reform proposal is expected to result in only a slight increase in actual undocumented immigration flows, and that it is not to be accompanied by any change in the overall enforcement orientation of U.S. immigration policy, its implementation should have only a slight negative effects for other U.S. citizens (assuming there are costs associated with undocumented immigration).
If S.1815 were to result in amnesty for a significant number of currently undocumented immigrants, they would benefit from its passage: even when controlling for education and other social capital, legal immigrants receive higher wages than undocumented workers. However, I have argued that the barriers to receiving amnesty under the conditions of S.1815 make it unlikely that many immigrants will receive amnesty. At best (from undocumented immigrants’ perspective), the program would therefore have little effect because immigrants would not participate in it. At worst, the amnesty program would have negative consequences for immigrants who attempt to participate, but fail to meet the requirements at some point in the following seven years, and are subsequently deported. Participation in the amnesty program would also weaken H-2A employees’ ability to “vote with their feet,” and could force them to choose between finding a living wage in non-agricultural work (since oversight of the H-2A program will be too weak to protect wages) and keeping their amnesty status (by staying it the H-2A program).
For legal immigrants participating in the H-2A program, the proposed reforms would be costly. The biggest difference immigrants would notice would be falling wages. 11 In addition to lower over-all wages, the revised H-2A program would allow forced production speed-ups without any wage increase. Finally, the proposed revisions would no longer require a minimum wage for each employee, but rather would require that the average employee wage rate be as high as the mandated minimum, creating the possibility that a large number of workers will receive even lower wages. While S.1814 cuts wages, it does nothing to improve a guestworker oversight regime which is notoriously weak. The I.N.S. and DOL consider agricultural labor exceptionally difficult to oversee because production occurs in open spaces, involves numerous workers, and is located at great distances from I.N.S. and DOL field offices (GAO 1997, 34).
Other Mexican Citizens
According to officials at the Mexican embassy in the United States, Mexico has not taken an official position on either S.1814 or S.1815, and will resist doing so. While immigration has always been a sensitive topic between the two countries (see Rico 1992, Rosenblum 1998 and 2000, Thorup 1989), pre-election pressures in means that it is especially unlikely that Mexico will take an official position on the bills in the current session of Congress. However, if Mexico were to take a position, it seems likely that Mexico would oppose the bills because they are likely to do more harm than good for Mexican immigrants, as explained above. From Mexico’s perspective, any “good” guestworker bill would include Mexico’s participation in the conceptualization and, especially, the implementation of a bilateral agreement.
3.2 A Strict Enforcement Regime
Current U.S. policy rhetorically emphasizes the deterrence of undocumented immigrants, but fails to actually deter unauthorized entries. A strict enforcement regime would diversify current enforcement efforts with the goals of eliminating the job magnet which attracts undocumented immigrants to the United States, increasing the likelihood that immigrants will be apprehended and deported even after they have successfully crossed the border, and still maintaining and perhaps expanding current border control efforts.
3.2.1 Proposal for a Strict Enforcement Regime
The I.N.S. devotes 304 staff-years to non-criminal investigations, or six staff-years per state; only 224 staff-years are devoted to worksite enforcement, with the other 80 being devoted to tracking down other non-status migrants. Thus, worksite enforcement accounts for less than four percent of I.N.S. enforcement activities (GAO 1997, 31). In 1999, only 8,600 undocumented immigrants were arrested for deportation in the U.S. interior (Uchitelle 2000). Given an undocumented immigrant population of 5,000,000, these trivial interior enforcement efforts imply that an immigrant who clears the border area is free to work at will in the United States, and the expected utility for would-be undocumented migrants remains positive.
Thus, if the goal of immigration policy is to maximize deterrence of undocumented immigration, it is necessary to focus on workplace enforcement to eliminate the job magnet which is the main draw for most undocumented migrants. An effective worksite enforcement program would include three components. First, I.N.S. staff-years devoted to worksite enforcement should be increased overall and as a percentage of the I.N.S.’ total budget. Second, to eliminate the job magnet it is necessary to make it costly for employers to hire undocumented migrants. The current employer sanctions law imposes a fine on employers of no more than $2,500 (and as little as $250) for each undocumented migrant employed for up to three separate offenses. If an employer can expect to save up to $6,000 per year, at a minimum, by employing undocumented immigrants, 12 it is worth employing undocumented immigrants even if an employer expects to be caught (which the employer does not, currently). Fining employers a figure closer to $20,000 per migrant for a first offense, and a higher figure and/or jail time for subsequent offenses would be a stronger deterrent.
Third, in order for a system of employer sanctions to be effective, it would be necessary to implement a national counterfeit-proof ID system along with a database of all citizens eligible for employment in the United States. Such databases exist in most European countries, and have been used with varying degrees of success to allow employers to check the legal status of prospective workers. Employers would be required to contact a national clearinghouse to check workers’ employment status. In cases in which the same ID number appears too frequently, an investigator would investigate whether a fraudulent card is being employed. Employers would also be required to notify the central clearinghouse when an employee stops working for them. 13
3.2.2 Anticipated Effects of a Strict Enforcement Regime
Two sets of empirical cases provide insight into how a strict enforcement regime would function. First, the two most serious efforts to limit undocumented immigration to the United States occurred during the 1930s and during “Operation Wetback” in 1954. In both cases, enforcement focused on rounding up groups of immigrants, checking their documents, and deporting all those who were unable to prove citizenship. In both cases, an significant number of legal residents were also deported when they were unable to produce their proof of residence, and the success of the removal programs relied on generalized harassment, which made it uncomfortable for immigrants to stay in the United States.
Second, the experience of European countries provides some insight into the feasibility of policies which emphasize workplace enforcement. The consensus within the employer sanctions literature is that although most European countries and Japan have tough sanctions on paper, enforcement is infrequent due to low enforcement budgets, lack of political will, or liberal democratic institutions which make it difficult to punish employers (see e.g., SOPEMI 1999, 243-245; Cornelius et al. 1994; Hollifield 1992). The one possible exception to this generalization is the German case in which workplace enforcement against undocumented immigration is integrated within a broader workplace enforcement effort to limit “irregular” (i.e. off-the-books) employment of natives and legal residents as well as undocumented immigrants (Hailbronner et al. 1998, 204-207; Stobbe 2000). In fact, employers pay higher fines for evading social insurance taxes than they do for hiring undocumented immigrants (P. Martin 1994, 220). As a result, it appears that few undocumented immigrants find work in Germany, especially compared to the U.S. case.
However, there are several obstacles which make these historical and comparative cases poor analogies to the current situation. First, in the case of the historical U.S. comparisons, while both crack-downs were successful in removing and preventing undocumented immigrants, they benefited from historically unique settings. In the case of the 1930s, the U.S. Depression—as well as the depression in Mexico—made it difficult and unappealing for migrants to return. It was also the case, even absent these unfavorable economic conditions, that immigration was more difficult and relatively more costly in the 1930s than it is in the 21 st century. In the case of Operation Wetback, the crack-down on immigration was greatly facilitated by the presence of the bracero program, a large-scale guestworker program which brought in 430,000 legal guestworkers in 1954. To a large extent, Operation wetback was successful because it substituted legal for undocumented immigration (Rosenblum 2000, Calavita 1992).
Second, in the case of the German comparison, worksite enforcement is facilitated by the fundamentally different approach to regulation, which includes highly centralized employment and housing systems. As Hailbronner et al. (1998, 205) point out, citizens and non-citizens alike must register with the government, providing extensive information on family status, former residence, date of move, etc. each time they change their residence, a requirement which is inconceivable in the United States. Thus, cultural norms in Germany appear more permissive of workplace enforcement, and workers and employers might both conspire against such a program were it to be attempted in the United States..
How successful would a strict enforcement regime be in controlling undocumented migration? In theory, there is a level of border enforcement and a likelihood of not finding work which will deter undocumented migration; and there is a level of fine and a probability of being caught which will deter employers from hiring undocumented workers. Achieving these enforcement levels would probably require a massive dedication of resources and a re-orientation of American attitudes about the role of the state.
3.2.3 Implications of a Strict Enforcement Regime for Various Economic Groups
U.S. workers would benefit from strict enforcement of worksite restrictions on immigration. While organized labor formally opposes employer sanctions, and so would theoretically oppose a strict enforcement regime, the decision by unions to adopt this position is based on the assumption that no meaningful employer sanctions would be enforced. Unions prefer no sanctions, to asymmetric sanctions which benefit employers; but they would prefer strong sanctions which actually deter hiring to either of the other possibilities.
A greater emphasis on worksite enforcement shifts the costs of migration enforcement from being strictly focused on immigrants to being divided more evenly between immigrants and U.S. employers. On one hand universal strict enforcement would help employers overcome their collective action problems and all employers could afford to stop hiring undocumented immigrants without worrying about being undercut by their domestic competition. But overall, U.S. employers would be harmed by these measures for two sets of reasons. First, strict worksite enforcement imposes regulatory costs on employers, who would have less flexibility in their hiring decisions. Second, as the labor pool shrinks, employers would have less access to certain desirable workers and wages would rise. 14 Third, as a result, immigrant-dependent import-competing or export-producing firms would be less competitive in the global market.
It is hard to estimate with any degree of accuracy the effect of undocumented immigrants on consumer goods, but there is little question that it is significant: undocumented immigrants subsidize the production of U.S. agricultural products, manufactured goods, and services by working under difficult conditions for low wages. The price increase of these goods and services would reflect not only an increase in wages, but also employers greater likelihood of paying all appropriate taxes, extending additional benefits, and improving working conditions.
Other U.S. citizens
The benefits to the U.S. population at large of eliminating undocumented immigration is also hard to estimate. On an economic level, most analysts agree that the overall effect of undocumented immigration on the tax base is marginal, and perhaps slightly positive. But, presumably, there are other, non-economic benefits which would follow from curtailing undocumented immigration, which might include greater respect for the law and/or an improved civic culture.
At the same time, the social and economic costs of enforcing a strict control program like the one described here would be extreme. At the general societal level, increasing interior enforcement by a factor of, say, one hundred (i.e., 3,000 additional staff-years devoted to interior enforcement) would cost a minimum of $200,000,000. To increase interior enforcement by a factor of one thousand, which might be necessary, would cost close to $2 billion. Second, regardless of how much effort is made to perfect national ID cards, and regardless of the education effort associated with implementing this type of program, it is inevitable that the general attack on immigrants implied by the strict enforcement regime would spill over to negatively impact all residents and citizens of recent immigrant descent. This problem will be especially severe in areas near the border and/or with high concentrations of immigrants.
The cost of this program to undocumented immigrants would be high. In fact, the thinking behind the program is specifically to set enforcement at a high enough level that would-be undocumented immigrants are actually deterred. Given the strength of push factors in Mexico (and other sending states), these negatives will have to be substantial; and immigrants will be forced to choose between undesirable conditions in their countries of origin or, theoretically, even less desirable conditions in the United States.
Legal immigrants would face even more discrimination than would U.S. citizens of immigrant descent. A strict enforcement program would also have an impossible-to-measure negative impact on immigrant communities who would be made to feel unwelcome and under siege. It is likely that “desirable” migrants with high social capital will also be deterred.
Finally, a strict unilateral approach to immigration control would be costly to Mexico on social and economic levels, and would be extremely damaging to U.S.-Mexican relations. Within Mexico, the sudden return of two million or more undocumented Mexican migrants would have a massive negative impact on Mexico’s already fragile economy, and would be likely to have an extremely disruptive effect. Rising unemployment and the loss of migrant remittances would be likely to place a serious strain on the Mexican social welfare system, requiring new state spending, and possibly a balance of payments crisis. The negative social and economic impacts of these changes would fall disproportionately on Mexico’s poorest citizens.
From the perspective of U.S.-Mexican relations, the damaging impact on the Mexican economy would have immediate economic effects in the United States as well, given that Mexico is the United States’ number-two trading partner. And given Mexican responses to previous enforcement efforts (see Jungmeyer 1988, Rosenblum 1998, Rosenblum 2000), it is a near certainty that mass and elite reactions in Mexico would demand an official condemnation and cause a severe deterioration in the bilateral relationship.
3.3 A Market-based Solution to Undocumented Immigration
At the other policy extreme would be an immigration policy which sets as its goals the improvement of standards for workers in the United States and in Mexico, the reduction of enforcement costs, a guarantee of sufficient low-skilled labor in the United States, and the elimination of undocumented immigration from Mexico. All of these goals would be pursued by moving from an enforcement-based regime which seeks to deter undocumented immigration, to a market-based policy legalizes the flow of labor by establishing a North American common market (NACM) within the NAFTA framework.
3.3.1 Proposal for a Cooperative Market-based Regime
At the center of a cooperative approach to immigration control would be a bilateral agreement between the United States and Mexico: the United States would allow the free flow of labor and establish or oversee a migrant remittance banking system; and Mexico would enforce improved labor standards in Mexico, invest in Mexican migrant-sending communities, and increase its police efforts at the U.S.-Mexican border to prevent the flow of drugs and (non-Mexican) undocumented immigrants. Within the NACM area of Canada, the United States, and Mexico, the flow of goods, capital, and people would be unregulated. At the same time, the NACM would also adopt a universal set of labor standards, and enforcement would be monitored at the super-national level by a NACM body including representatives of all three member states. In the United States, the majority of resources currently employed along the U.S.-Mexican border would be transferred to internal workplace oversight. Workplace oversight would move closer to the German model in which enforcement of wages and standards would take precedence, and would be integrated with enforcement of NACM immigrant labor eligibility. 15
From the perspective of U.S.-Mexican migration relations, NACM labor standards imply two important changes. First, Mexican members of the NACM oversight board would be empowered to bring complaints against U.S. employers found to be discriminating against or taking advantage of Mexican migrant workers. Super-national enforcement would be designed to ensure that Mexican workers in the United States enjoy the same wage and benefit guarantees as U.S. workers. Second, for Mexicans (and U.S. workers) in Mexico, the NACM would establish a set of wages and standards comparable to those in the United States and Canada, adjusted for cost of living differences. Super-national oversight would require Mexico to penalize employers failing to meet these standards.
Revenues to pay for Mexican oversight, and to subsidize Mexican employers who currently benefit from low standards would come from three sources. First, Mexico could reallocate current social spending because Mexican communities would receive a greater flow of migrant remittances due to both rising immigrant wage rates and improved mechanisms for remittance transferal (lower transaction costs). 16 Second, Mexican workers would be taxed at the same rate as their U.S. counterparts, but the majority of the Mexican workers’ tax dollar would be returned to Mexico to support job creation and improved standards. Mexican migrants would only contribute taxes to the U.S. social security system, unemployment insurance, and other social welfare programs for which they would be eligible. Third, the remaining funds needed to pay for Mexican reforms would come from direct transfers from the U.S. government to Mexican producers.
3.3.2 Anticipated Effects of a Market-based Proposal
What would be the likely effects of such a radical change in U.S.-Mexican immigration policy? For the United States, the key question is whether it is possible to improve working conditions in low-skilled industries, and to combine the enforcement of wages and standards with immigration eligibility (i.e., with worksite immigration enforcement against non-Mexicans). As noted above, the general U.S. business culture of loose regulations presents an obstacle to effective employer sanctions. But three changes implied by the move to a NACM suggest that worksite enforcement could be improved. First, by drastically reducing the need for I.N.S. funding and staffing aimed at the border, it would be possible to move thousands of agents into worksite enforcement with minimal new expense. 17 Second, by linking duties currently within the wage and hour division of the DOL with immigration inspections, worksite enforcement would achieve greater economies of scale, benefiting from DOL expertise and from bringing U.S. unions into a pro-enforcement coalition. Third, by including Mexican agents through a NACM oversight committee, regulations regarding Mexican employees would also become more enforceable. With 43 Mexican consulates already spread throughout the United States, an infrastructure is in place which successfully represented Mexican interests during the early years of the U.S.-Mexican bracero program (see Rosenblum 2000, Craig 1971).
What would be the effect of a move to a NACM on undocumented immigration? By definition, the problem of undocumented immigration from Mexico would be eliminated, but two other questions must be addressed. First, what would be the effect of establishing a NACM on undocumented immigration from other source countries, and second, what would be the effect of a NACM on labor flows from Mexico. Regarding the first question, it is reasonable to expect that the legalization of all Mexican workers combined with stepped-up worksite enforcement and Mexican cooperation on the prevention of non-Mexican undocumented immigration across the U.S.-Mexican border would reduce additional undocumented immigration. These conditions would affect both the demand for and the supply of undocumented labor. On the demand side, most employers who hire undocumented immigrants are motivated by a combination of two factors: desire to pay low wages (and avoid taxes and benefits), and the belief that immigrants have a better work ethic. Worksite enforcement would minimize the former incentive, and the easy availability of legal Mexican workers would minimize the second. Mexican workers would have a comparative advantage over non-Mexicans with similar backgrounds, so the demand for undocumented immigrants should decrease. On the supply side, combining U.S. and Mexican enforcement efforts would improve border and interior enforcement, and would, in particular, allow the I.N.S. to target a group of undocumented immigrants (non-border crossers) who are currently unregulated.
The second question regarding immigration flows is: would the movement to a NACM greatly increase the flows of Mexicans to the United States, resulting in a costly “brain drain” and/or a loss of Mexico’s best workers on the one hand, and an over-supply of labor in the United States on the other? There are at least four reasons to think this would not be the case. First, to the extent that undocumented migrants are relatively undeterred by current border enforcement efforts, dropping border enforcement would have little effect on the overall numbers of immigrants. 18 Second, if it is possible to actually improve wages and standards in Mexico, and so to limit the incentive for Mexicans to emigrate, the demand for immigration would decrease. Indeed, the U.S. Commission for the Study of International Migration and Cooperative Economic Development (1990, xiv) concluded that economic development and job creation in sending states is the only way to diminish undocumented immigration pressure. Third, improved wage and standards enforcement would lower the demand for Mexican labor because many employers would prefer to hire better-trained U.S. workers for the same salary. Finally, many of the non-economic deterrents to emigration, including the social, psychological, and cultural costs of migrating, would remain in place. 19
A third question about the likely implications of a cooperative market-oriented approach to immigration is whether it is possible to improve working conditions and increase employment opportunities in Mexico, and what the effects of these efforts would be. Much has been written about the developmental approach to fighting undocumented immigration (see e.g., U.S. Commission 1990, Stalker 1994, Díaz-Briquets and Weintraub 1991), and the consensus is that this approach requires careful targeting of investment to particular sending communities and particular labor-intensive industries. Analysts also emphasize that financial aid should be accompanied by debt forgiveness, access to receiving-state markets, and other policies which maximize benefits to migrant-sending states.
Finally, job creation as a tool of migration control requires a long time horizon; increased investment in migrant-sending states will not immediately result in falling emigration rates. Finally, will the movement of U.S. agents away from the border promote an increase in the flow of narcotics into the United States? U.S. agents would continue to play a role in counter-smuggling efforts; but because large-scale drug shipments tend to enter via vehicles, the expensive border strategy of deterrence and apprehensions in desert areas could be greatly reduced. Second, it is quite likely that the carrot of a NACM would be more effective in motivating intense Mexican cooperation than has been the stick of de-certification; and Mexican enforcement goals could be set as a precondition for the NACM. 20
3.3.3 Implications of a Market-based Regime for Various Economic Groups
U.S. workers would be skeptical of such a plan, but stand to benefit enormously from it. If the free flow of labor within a NACM is not accompanied by improved worksite enforcement of wages and standards in the United States, then this proposal would simply expand the U.S. labor pool and depress wages. Likewise, if the freer flow of Mexican labor to the United States is not accompanied by job growth in Mexico, then immigration will increase with the same negative effect. But both of these implementation issues are open questions; and there is a level of worksite enforcement and Mexican job growth which makes a NACM good for U.S. workers. The qualified support the AFL-CIO offers the WTO (pending improved standards abroad), and the strong pro-immigrant position being adopted by U.S. unions, suggest that organized labor would support cooperative immigration control.
For U.S. employers, the cost of moving to a NACM depends upon employers’ dependence on low-skilled labor, on the importance of exports to overall sales, and on the degree to which they compete with imports. Increased enforcement of wages and standards would primarily effect industries for which unskilled labor is an important component of costs. For these immigrant-dependent businesses, production costs would increase even if the labor pool expands slightly. For producers of non-tradables—which include many industries which are immigrant-dependent like hotel and food services, construction, landscaping, etc—uniform enforcement would prevent collective action problems so that rising labor costs could be passed along to consumers. Thus, it is only labor-dependent exporters and import-competing industries who are hurt by rising labor costs because their international competitiveness falls. Even these businesses would not be wiped out, however, because many have already adjusted to changes in the world economy which have threatened their competitiveness, and have begun to modernize and develop niche markets.
With tighter regulation of the workplace and enforcement of minimum wage and safety standards, the cost of production would increase under this plan for a number of industries which currently exploit undocumented immigrants. For non-tradable industries, it is likely that these increasing production costs would be passed largely or entirely along to consumers. Likewise, U.S. imports from Mexico (currently valued at $860 billion) would experience price increases as Mexican wages and standards would be raised as a condition of the NACM establishment. Thus, to a large extent, U.S. consumers would be asked to subsidize the effort to limit undocumented immigration and to upgrade Mexican standards.
Other U.S. citizens
For U.S. citizens in general, the benefits of moving to a NACM would outweigh the costs. First, there is the great likelihood that a NACM would reduce the overall level of undocumented immigration for the reasons noted above. The higher proportion of legal migrants would raise wages, promote respect for U.S. laws, greater civic participation, etc.
Second, cooperative immigration control would generate savings compared to the current border enforcement approach. On a financial level, U.S. taxpayers would save millions of dollars by obtaining Mexican cooperation at the U.S.-Mexican border and by eliminating the need for expensive migration detention facilities. 21 Even if an equivalent level of enforcement is necessary in the interior, the economies of scale involved in combining I.N.S. and DOL oversight, and the greater ease of policing fixed urban worksites rather than an expansive rural border will generate savings. Eliminating the current game of hide-and-seek at the U.S.-Mexican border would also have significant non-economic benefits for Latinos, civil libertarians and for all property owners near the border who would no longer be subjected to I.N.S. agents violating their privacy and property rights.
In addition to these benefits, there would be some costs to the general U.S. public. First, if the move to a NACM resulted in a large inflow of Mexican workers, the increasing strain on social services and other public goods would compromise the services available to current U.S. residents. If new migrants were to use a disproportionate share of public goods, the additional inflows would also result in additional tax burdens. However, given that most migrants would be young, healthy, and looking for work, it is likely that new legal migrants would be net contributors to the tax base, rather than net users, and that they would support the aging U.S. Social Security system. A second potential cost to U.S. citizens would be the funding required to subsidize Mexican producers and Mexican oversight agents in an effort to increase Mexican employment and to raise Mexican production standards. Although Mexico would be expected to contribute to these efforts in exchange for the benefits of participating in a NACM, it is likely that U.S. resources would be required to avoid placing excessive strain on the Mexican system. A final cost, which would be an important if implicit aspect of any debate over a NACM, would be the cultural-social cost to nativists who object to the possibility of increased immigration from Mexico.
For Mexicans currently in the United States illegally, the benefits of legalization are obvious. Undocumented immigrants’ wages and working conditions should both improve. These immigrants will no longer live in fear of apprehension and removal, but rather will be in a position to make long-term investments in their communities. Remittances by migrants to their families and source communities will increase as wages go up and as transaction costs of transmission decrease. It will also be less costly for immigrants to return to Mexico regularly, increasing the flow of resources to Mexico, and making it more likely that immigrants actually return to Mexico rather than putting down roots in the United States. The only conceivable cost to undocumented immigrants is that a larger portion of their wages will be taken in the form of taxes, but the tax losses will be outweighed by wage and service gains. Non-Mexican undocumented immigrants, on the other hand, are clear losers under this plan as the likelihood of apprehension and removal would sharply increase with enforcement moving from the U.S.-Mexican border to the interior.
Legal immigrants would enjoy similar benefits to undocumented immigrants, though their relative gains would be smaller. Wages and working conditions would improve throughout low-skilled sectors of the economy. Legal Mexican immigrants would further benefit from the reduction in anti-immigrant hostility and from the further integration of the U.S. and Mexican economies. While non-Mexican legal immigrants would share the benefits of increasing wages, they might suffer from the transposition of current anti-Mexican immigrant-bashing to other ethnic groups.
Other Mexican Citizens
Moving to a NACM would not be costless to Mexico. The greatest obstacle from within Mexico would be the mandate that wages and standards be raised to a level proportional to the United States. Mexico has spoken out against previous effort to “export U.S. values,” claiming (not without merit) that less developed countries deserve to exploit their comparative advantage in low-cost labor. Second, Mexico would be asked to expend greater national resources on border policing and on investing in migrant-sending communities. And third, the possibility exists that successful efforts by Mexico to raise wages and standards will result in decisions by would-be investors to avoid Mexico in favor of less well-regulated countries.
But these costs to Mexico would be easily outweighed by the benefits of a NACM. Each of the costs identified above would be small. First, participation in a NACM would not require that Mexico raise standards to the U.S. level, but rather that they reach a proportional level, controlling for standard of living. Second, border policing efforts would not be politically costly since they would not regulate Mexican emigration; and investment in sending communities would be politically popular, especially if it were accompanied by U.S. matching funds. And third, while it is possible that raising Mexican standards and wages will discourage some investors, the support from the United States implicit in a NACM would be a major attraction to investors, and the net effect of a NACM on investment in Mexico would be positive.
Mexico would also reap important benefits from the NACM. On an economic level, Mexico would benefit from more migrant remittances as discussed above. An even greater savings would be the elimination of transfers from migrants to smugglers, an illicit industry which may cost Mexicans a half-billion dollars each year. Mexico would also benefit from the greater ease of return and circular migration, as noted above. The Mexican economy generally would benefit from closer union with the United States. Factor price equalization would occur more rapidly, and gains from trade and specialization would be greater for Mexico, than for the much larger United States.
Finally, the Mexican government would reap enormous domestic political benefits from reaching a NACM agreement. First, the abandonment of the U.S. border enforcement strategy of pushing undocumented immigrants into inhospitable desert and mountain terrain would reverse the disastrous trend of increasing border deaths since the early 1990s. Mexico’s inability, thus far, to protect emigrants from these dangers had been costly in terms of loss of life and on a domestic political level. More generally, the ruling PRI, as well as Mexican voters and opposition parties all consider the protection of migrants’ human rights an important foreign policy goal; and the creation of a NACM would offer concrete steps in that direction. For that and other reasons, Mexican voters would be likely to consider a NACM to be beneficial to Mexico.
4. Conclusions: Recommendation and Feasibility
In evaluating the relative benefits of competing policy options, I consider the likely effectiveness and cost efficiency of the different proposals. Distributive effects raise questions about the political feasibility about the plan which otherwise appears most promising: the bilateral market-oriented approach.
4.1 Effectiveness and Efficiency
4.1.1 Unilateral Enforcement Regimes
The first three plans discussed rely on some combination of unilateral border control, employer sanctions, and (in all but the strict enforcement regime) some type of guestworker program. This basic approach fails for at least three reasons. First, unilateral enforcement—especially when concentrated at the border—fails to recognize the forces of globalization and, in particular, the effects of increasing U.S.-Mexican integration (see Sassen 1998, among others). The worldwide trends of increasing flows of goods and services, falling costs of travel, and growing transnational communities make it more difficult for countries to prevent immigration through border enforcement; and none of these trends show any sign of slowing or reversing. The United States and Mexico have implemented a free trade area, and Mexico has become the United States’ second biggest source of imports and exports; more goods flow across the U.S.-Mexican border than any other land border in the world. It is simply not possible to prevent people from crossing that border as well. Current border enforcement efforts—as well as those considered within the guestworker reform and strict enforcement proposals—fail to actually deter migration, while they are damaging to bilateral relations and slow economic integration.
The second problem with all three of these unilateral enforcement approaches is that they create opponents of control, but fail to create a political constituency in favor of immigration control. At the workplace, the one thing employers, workers, and labor unions all agree on is a desire to thwart I.N.S. enforcement efforts, though for different reasons. The only individuals likely to help enforce immigration controls at the worksite are disgruntled employees and union-busting employers. Nor is there a powerful constituency for border and non-worksite interior control. Civil libertarians oppose the invasive steps which would be required for such controls to be effective; and Latinos and other property owners near the border have lost patience with Border Patrol efforts to prevent border crossing. The only groups inherently supportive of border-oriented enforcement are I.N.S. bureaucrats and anti-immigration activists.
The third problem with the current enforcement regime and with the two unilateral counter-proposals is that they discourage cooperation among executive branch agencies involved in immigration enforcement. The I.N.S. itself is given a schizophrenic mission of providing services to immigrants while simultaneously apprehending and deporting them. The DOL and other federal agencies devoted to protecting workers often find themselves hampered by immigrants’ fear of the federal government.
In sum, none of the unilateral enforcement regimes is likely to be effective, and comparing them is a matter of estimating which is the least of three evils. The worst option would be a strict enforcement regime along the lines I have described. For strict unilateral enforcement to produce results would be far too costly in terms of federal spending, the human and civil rights of migrants and U.S. residents, and U.S.-Mexican relations. Among the other options, it would clearly be a mistake to maintain the current system while adding the proposed “guestworker reform” provisions. The guestworker bills fail to address any problem other than a non-existent shortage of agricultural labor, yet they are likely to have the unfortunate effects of lowering wages for U.S. and non-U.S. workers while encouraging additional undocumented immigration. This leaves the current system, expensive and ineffective as it is, as the best option among unilateral policies.
4.1.2 Bilateral Market-based Enforcement
In contrast, a cooperative, market-based solution embraces the reality of economic integration and makes the most of the U.S.-Mexican relationship. Deepening integration has not only lowered the cost of immigration, it has also created opportunities for bilateral cooperation. The existence of NAFTA and of current bilateral immigration institutions, including through the Border Liaison Mechanisms and Mechanisms of Consultation (see Rosenblum 1999 and 2000), lower the costs to both countries of building new cooperative immigration institutions. Mexico’s expanded importance as a U.S. trading partner raises the benefits to the United States of sharing the costs and responsibilities of contributing to Mexican employment opportunities and standards. Economic integration means that both countries benefit from eliminating the deadweight losses of immigrant transfers to smugglers in favor of increased consumption and production.
A second general advantage to the bilateral, market-oriented approach is that the focus on interior enforcement creates a powerful coalition of groups which support enforcement. In particular, labor unions, individual immigrant and non-immigrant workers, and the Mexican foreign service would all support DOL enforcement of wages and standards. Third, similarly, the focus on interior enforcement would encourage cooperation among federal agencies, allowing the DOL to cooperate with immigration enforcement agents, instead of opposing them. The I.N.S. would be freed up, consistent with reform efforts currently pending in Congress, to focus its attention on visa and naturalization service. Responsibility for border enforcement could be concentrated in the hands of traditional enforcement agents, such as the Customs Service and prosecutors’ offices, a move which would foster bilateral cooperation with Mexico since these agencies share common enemies on both sides of the border (i.e. smugglers), unlike under the current system (in which the U.S. is mainly focused on immigrants, a population Mexico does not seek to control).
Fourth, in contrast to unilateral enforcement, a system which focused on deregulating the bilateral labor market would allow market forces to determine the supply of labor. In a segmented economy with a finite number of unskilled (immigrant-dependent) jobs, legal Mexican immigrants would have a comparative advantage for obtaining these positions, reducing the job magnet for other undocumented immigrants, freeing up resources to protect labor standards, and increasing the flow of remittances to Mexico, to the benefit of both countries. Thus, only the market approach is likely to achieve the twin goals of legalizing the Mexican portion of the undocumented flow and limiting undocumented immigration from other source countries. Allowing market forces to play a prominent role in setting migration flows is also more cost-effective than is relying entirely on military-style enforcement.
4.2 The Politics of Immigration Reform
If a cooperative approach to immigration policy-making would result in equal or better outcomes for most affected actors, why is it the one solution least discussed by U.S. immigration policy-makers? The answer to this question is threefold: the distributive effects of immigration policy benefit powerful groups under the current system, the current system is also highly stable for non-distributive reasons, and there are several as yet un-discussed obstacles to moving toward a NACM. On the other hand there are reasons to expect that the political feasibility of a NACM solution may be increasing.
4.2.1 Distributive Effects
The status quo and the modified (by guestworker reform) status quo have similar distributive effects: immigrants are attracted by economic reality, but then placed at a legal and cultural disadvantage which gives employers an unfair bargaining advantage in negotiations over wages. The result is that wages for all workers go down, and workers subsidize U.S. employers and consumers. Guestworker reforms being discussed would exacerbate these distributive effects within the affected agricultural sectors.
A strict enforcement regime imposes costs of enforcement on all U.S. citizens, to varying degrees. The only winners under a truly effective enforcement regime would be legal workers in the United States, who would see wages increase. Consumers, employers, and would-be immigrants would pay for these wage increases; and U.S. taxpayers would also expend significant resources to protect these wage gains. The costs of strict enforcement to the bilateral U.S.-Mexican relationship would also be very high.
Finally, a NACM would remove the current subsidies to U.S. consumers and producers, and allow wages to re-equilibrate at a higher rate. The costs of these reforms to consumers would be positive, but low enough that they would be partly offset by the savings generated by economies of scale and social group support for enforcement. The biggest losers under a NACM relative to the current system would be the coyote people smugglers, and export-oriented and import-competing labor-intensive employers, who would lose comparative advantage relative to countries with traditional enforcement-oriented immigration policies. Exporting firms might recoup some losses due to gains in the Mexican economy; and importers might demand modest import restrictions. Labor-intensive producers in non-tradable sectors would face collective action problems regarding the maintenance of wages and standards for legal workers, but with universal enforcement by newly-empowered DOL agents, domestic producers would not lose under this plan. The biggest winners are workers in the United States and Mexico.
4.2.2 Obstacles to Immigration Policy Reform
The stability of the current unilateral enforcement regime is explained, in part, by Olsonian interest group politics. First, the beneficiaries of the current regime are a powerful combination of a concentrated privileged group (agribusiness) and diffuse consumers who are not mobilized on the issue, but who are present in every single district in the country. In contrast, opposition to the border/weak sanctions regime has, until recently, consisted solely of a completely disenfranchised latent groups: undocumented immigrants. Only recently has an economic interest group with any organizational strength (labor unions) dropped its support for the existing system, and labor remains at least somewhat divided over whether to reject employer sanctions or not. Finally, the I.N.S. itself has a vested interest in maintaining the status quo, and with 20,000 employees and a $4.1 billion budget the I.N.S. is a non-trivial bureaucratic actor.
There are several additional obstacles to policy reform. At least two general features of immigration policy-making suggest that a cooperative solution is unlikely. First, immigration political is subject to policy inertia, so it is difficult to implement substantial policy reform until reform is overdue. As a result, by the time major immigration reform occurs, it usually occurs within a highly salient domestic political environment. High domestic salience raises the political stakes for both Congress and the president, making it difficult for either actor to bring international issues into the debate (Rosenblum 2000). A second obstacle to bilateralism is the role of racism in immigration policy-making. None of the cost-benefit calculations I have described in this paper attempt to take the racism of interest groups and/or policy-makers into account, but there is no question that racism has consistently played a fundamental role in shaping U.S. immigration policy (see e.g., Loescher and Scanlan 1986, Divine 1956), and would be a hindrance to forming a NACM.
In addition to these general obstacles, at least three specific problems make enacting a bilateral immigration policy difficult. First, international cooperation is always risky (Axelrod 1984, Keohane 1986, Snidal 1986), and a cooperative effort which includes a U.S. commitment to de-militarize its southern border would carry special risks. In short, if Mexico were to fail to complete any of its promised responsibilities, including job creation, raising standards, and border policing, the U.S. could be vulnerable to a massive influx of new unwanted immigrants. In theory, this is a contracting problem which can be solved through monitoring devices which would raise the cost of a bilateral agreement. A second case-specific obstacle is the long time horizon inherent in a cooperative solution. It would take years, at best, before increased investment in Mexico would lead to a reduction in immigration push factors (Díaz-Briquets and Weintraub 1991, U.S. Commission 1990, xvi), and it could take equally long before the message that the United States is no longer welcoming to non-Mexican undocumented immigrants filters back to other sending communities. Third, the creation of a NACM raises questions about limiting the free flow of labor to the NAFTA area: why should Central America and the Caribbean be excluded? Why should China be excluded? There is no obvious answer to this last point, and it is likely that if the Clinton goal of expanding free trade throughout the Americas is ever to come to fruition, then a common market restricted to current NAFTA countries could become untenable.
4.2.3 Possibility of Immigration Reform
Despite these obstacles, however, there are several reasons for optimism about the possibility of a cooperative approach to immigration control. The first, and most obvious reason is that the current system is a failure, and a growing number of policy-makers recognize that throwing more money at the Border Patrol, building more fences along the border, and denying more services to migrants have little influence on the strong forces affecting immigration. Increased economic integration between the United States and Mexico assures that these forces will remain in place, and makes a border-oriented immigration policy increasingly anachronistic. 22 Second, the political landscape in the United States is evolving in a way which is favorable for a bilateral approach to policy-making. Five or ten or twenty years from now, when a NACM is in place, analysts will look back to the February 2000 vote by the AFL-CIO to oppose employer sanctions as an important turning point in its development. Equally important is the growing participation and political power of Mexican-Americans as an ethnic group (González Gutiérrez 1993, Perez-Godoy 1999). In addition, immigrants are also increasingly active in politics in both the United States and in Mexico, and they are explicitly attempting to focus their transnational political power on bilateral immigration policies (Langford 2000, Corchado 2000).
Finally the government of Mexico, as well as other migrant-sending states are increasingly willing to participate directly in the U.S. political process, an effort which has been taboo until recently and is still often off-limits for open discussion. In Mexico’s case, high-level actors in the Foreign Ministry describe a learning process after Mexico’s “mistake” in not lobbying against the IRCA, a learning process which resulted in Mexico’s successful, full-scale lobbying campaign in support of the NAFTA agreement (author interview with Carlos Rico, Director General for North America, Mexican Ministry of Foreign Affairs, Mexico City, 7/8/98). In pursuit of these goals, Mexico has also adopted an explicit strategy of encouraging Mexican-Americans and Mexican immigrants to become more active in the U.S. political process, the co-called Program for Mexican Communities Abroad, as a way to increase Mexico’s political influence. Finally, the Mexican government has several attractive concessions it can offer the United States in exchange for moving to a NACM, including the lifting of restrictions on U.S. banks wishing to operate in Mexico (a move which Mexico successfully resisted during NAFTA negotiations) and a major expansion of drug control efforts. Thus, it is possible that a bilateral approach to immigration policy-making is not as far off as it seems on first consideration.
Table One: Immigration Enforcement Statistics
Total Border Patrol Apprehensions
Mexicans Apprehended by Border Patrol
Mexican Undocumented Immigrants (Estimated)
Source: U.S. I.N.S.,Statistical Yearbook, various years; Lorey 1990, tables 910, 921, 1012; U.S. Commerce Department, Statistical Abstract of the United States, various years.
Table Two: Budget Outlays for the I.N.S. in Millions of Dollars and as a Percentage of Total Federal Budget
Total INS budget
Percent of Total
Percent of Total
a Enforcement = Separate entries for inspection for admission, detention and deportation, and Border Patrol prior to 1982; separate entry for "enforcement" starting in 1982
Source: OMB, The Budget of the US Government ; and U.S. Commerce Department, Statistical Abstract of the United States
Figure One: Agricultural and Overall Unemployment, 1950-90
Source: Data taken from Jacobs (1999).
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Note 2: The limited recent efforts at bilateral policy-making have been important, however. In particular, the U.S.-Mexican Binational Commission has been very successful at building local institutions at the border which have mitigated the harsh effects of congressional restrictionism and insulated the U.S.-Mexican relationship against the possible fallout from North American anti-immigrant hysteria (Rosenblum 1999, Rosenblum 2000). Back.
Note 3: Dunn (1996, 40) argues that Carter favored delaying an increase in enforcement efforts pending the publication of the final report by the Select Commission on Immigration and Refugee Policy. I believe a more important factor was Carter’s effort to deepen overall cooperation between the United States and Mexico and his unsuccessful effort to establish cooperative border enforcement policies (Rosenblum 2000). Back.
Note 4: Legislation making it illegal to harbor, shelter, or transport undocumented immigrants was first passed in 1952 to encourage participation in the U.S.-Mexican bracero program; but the so-called Texas proviso explicitly stated that employing undocumented immigrants did not fall within the proscribed acts (see Calavita 1992, Rosenblum 2000). Back.
Note 5: The IRCA also included an additional “carrot” in the form of an amnesty for three different groups of undocumented based on their proven residence in the United States since January 1, 1982, or their proven employment in U.S. agriculture for 90 days in each of three years. I do not include this as an aspect of the current policy regime since it was included as a “one-time” policy tool. Back.
Note 6: These jobs are generally low-wage, and are also sometimes referred to as 3D jobs because they are Dirty, Dangerous, and Difficult. In the U.S. case, immigrant-dominated sectors of the economy include agriculture, hotel and restaurant, construction, low-skilled manufacturing, food processing, maintenance and cleaning, etc. Even to the extent that immigrants are becoming more widely distributed throughout the economy, it may be the case that they still occupy a migrant-specific niche because an increasing number of immigrants are employed by migrant entrepreneurs who prefer to hire co-ethnics (Waldinger and Bozorgmehr 1996, Cornelius 1998). Back.
Note 7: U.S. immigration policy has also addressed the availability of high-skilled labor: the 1990 Immigration Act created 140,000 immigrant visas distributed to individuals with needed labor skills, and there is currently a debate about expanding the H-1B visa program, which allows U.S. employers to recruit high-skilled immigrants on non-immigrant visas. I do not address issues surrounding high-skilled immigration in this paper. Back.
Note 9: Mexican consuls were active participants in enforcing bracero contracts between 1942 and 1947 and between 1951 and 1954; and the bracero program was highly successful at that time from Mexico’s point of view. In 1954, the sending state insisted on renegotiating the bilateral agreement to strip consuls of their oversight ability (Rosenblum 2000). The current system, like the post-1954 bracero program, does not work: in FY1996, the DOL received zero complaints from H-2A workers about wages and benefits (GAO 1997, 10). Back.
Note 10: Specifically, the proposal would eliminate the 50 percent rule which requires that employers hire qualified locals who appear before the season is half over; eliminate the “positive recruitment” requirement which requires employers to seek out U.S. workers; limit required recruitment to those workers enrolled in a state registry within the same state as the employer; and limit the registry search, in some cases, to fourteen days before allowing growers to recruit guestworkers over the next six months. Back.
Note 11: Currently, employers participating in the H-2A program must offer the highest of three wages: the federal or state minimum, the local “prevailing wage” defined by the DOL, or the H-2A adverse effect wage rate (AEWR), which is defined as the regional average wage for field and livestock workers from Department of Agriculture surveys. Under Reagan, the methodology for calculating the AEWR was revised, so that the AEWR fell by about twenty percent in most cases, though it is still usually higher than the prevailing wage. Under the proposed changes in S.1814, the AEWR would be re-defined as the local prevailing wage plus five percent, up to a maximum of the old AEWR, so S.1814 would lower the wage paid to many H-2A workers, and not raise the wage for any of them. Back.
Note 12: This figure assumes employers save three dollars per hour, 40 hours per week, by paying lower wages and avoiding unemployment, workers’ compensation, and other payments. Actual savings are probably typically greater. Back.
Note 13: As a side benefit, the existence of a national, counterfeit-resistant ID card system which all citizens would be required to carry at all times would also greatly facilitate stop-and-investigate operations by I.N.S. and Border Patrol officials away from the worksite, further increasing the likelihood that undocumented immigrants would be identified and removed. Back.
Note 14: According to many employers of undocumented immigrants, wages are not the primary motivation, and so rising wages would not be the biggest cost of strict enforcement: 54 percent of 114 San Diego County employers interviewed believe that immigrants, in general, are harder working than native-born workers (Cornelius 1998). Back.
Note 16: Media reports have indicated money transfer agencies like Western Union taking commissions as high as twenty percent when forwarding migrant remittances to Mexico (cite). Even if no other aspects of a NACM are established, the United States and Mexico would both benefit from developing an improved system for transferring migrant savings back to Mexico. Back.
Note 17: In 1999, the I.N.S. enforcement budget was $1.93 billion dollars, and the DOL’s Wage and Hour Division’s budget was $118 million (in 1997). Shifting half or two-thirds of the I.N.S. resources to worksite enforcement would have a dramatic effect on the DOL’s ability to enforce labor standards. Back.
Note 19: One empirical comparison is the case of the creation of the European Union: to a surprising degree, immigration rates between countries in Europe remained virtually unchanged (SOPEMI 1993-1999). However, the comparison is imperfect for two reasons: the wage gap is smaller, along the order of four-to-one between high and low wages countries in Europe compared to ten-to-one between the United States and Mexico; second, the cultural obstacles to migration are probably higher in Europe, with most European countries demonstrating lower rates of internal migration than either the United States or Mexico. Back.
Note 20: As with immigration, drug enforcement focuses overwhelmingly on the border and, in the case of drugs, on sending states because these enforcement mechanisms are least costly to U.S. residents. An integrated approach which encouraged Mexican cooperation and discouraged U.S. consumption would have the best chance of success. Back.
Note 22: From an economic perspective, if migrants are simply a mobile factor of production, then imposing quotas—or immigration controls—is the least efficient way to regulate production, resulting in deadweight losses and economic distortions. At a minimum, it is more efficient to impose a tariff (i.e., to charge immigrants for the right to enter the United States), rather than impose a quota (Chang 1998). In the current example, charging Mexican immigrants a figure roughly equivalent to the fee now charged by coyotes would have little or no effect on immigration flows, but would ensure that the costs of migration are reinvested in the United States and Mexico (assuming the payment was divided between the two states) rather than simply enriching smugglers. Optimal tariff theory would allow policy-makers to set a fee-for-entry level which would result in the ideal level of unskilled inflows. Back.