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Economic Impact of Immigration

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    Have you ever really considered just how important all of the factors involved in bringing a salad to the table at your favorite restaurant? If you have not, it is important that you read this paper to understand the impact that immigrated persons have on the population, jobs, wages, services, and ultimately the economy of California. Not to mention the intricate tie the economy has to one of California’s biggest commerces; agriculture.

    The intention of this paper is to discuss and investigate the impact of immigrated persons on the economy of California and a look at both sides of of the argument about what could happen without a constant level maintained of immigrated persons to keep the California economy moving. Without the immigrant workforce the commerce in the state would come to strand still. This is largely because in 2004 California had 36. 6 million residents, and approximately 9. 6 million of the population at that time was foreign born.

    This portion of the population represents more than a quarter of the total population of the state. Imagine if you will what impact the loss if a quarter of the state’s population were simply sent back to where they came from? Can we be led to believe that any commerce in the way that it functions now could endure a permanent decline in volume of 25% not to mention expected the loss of expected growth? For a single business, a decline of 25% for any length of time would certainly not allow it to survive for long as volume is what keeps a business alive.

    Should the population be culled down to the seventy five percent of United States born citizenry the situation would only snowball into the worst possible scenario for one of the world’s largest economies. After a fall of California’s economy then small countries would likely follow and certainly major financial shockwaves would be felt around the world. According to a report published by the Center for Continuing Study of the California Economy (2004), “The conclusion of most research on the subject is that immigration provides net economic benefits to domestic residents.

    In other words, immigration provides net benefits. In addition findings such as the following found in the report done by the Center for Continuing Study of the California Economy (2004), points to positive indicators from immigration, “…. domestic migration to California has been positive except during the economic recession in the early 1990s. While it is possible that individual residents may have moved out of state in order to avoid ompetition with immigrants, the overall trends show continuing domestic migration to California even as immigration remains high and housing prices move to record levels in relation to the rest of the nation. ” Non supporters of immigration publish their opposition to immigration. Reports like the one written by the Federation for American Immigration Reform, “Immigration, Energy and the Environment” have made parallels to immigration causing, and at the very least not helpful to the reduction of greenhouse gasses.

    This view by non-supporters, due to the sheer volume of people in immigrant status is a direct and major contributor to the reason why California is unable to meet the Kyoto green house standards. This supposition by the opposition is akin to stating that people should stop having children to eliminate the landfill issues that we currently have due to the tremendous amount of used diapers that children produce.

    Wage impact seems to weight heavy on the minds of the opposition to immigration. In an article published by JMK (2007) there are three reasons why downward pressure is exerted by the immigrated population: First, that because illegal immigrants are willing and able to work for sub par wages, which in turn makes it more difficult for non immigrant higher wage earning workers to demand higher pay setting the wage floor lower than it should be.

    Second, that immigrated persons tie into the basics economic theory of supply and demand, the labor force having been increased by a number of immigrant workers increases the supply therefore flooding the labor market with excessive number of workers driving down the pay being offered by potential employers. And thirdly the article goes on to state: that due to the first two factors “there is an aggregate reduction of potential consumer spending by $243 billion/year.

    The reduction in consumer spending reduces demand for production, and the demand for workers to provide that production. The result of this reduced demand for labor is a further reduction in wages. ” In essence the opposition believes that immigration affects the wages of natural born citizens, or dilutes the earning capabilities. Another report however, prepared by the Academy of Science (2004) does not support the idea that immigration affects the wages of native workers adversely. The study only outlines a weak relationship between immigrant wages and native wages.

    The most significant impact to wages appears to be from wave to wave of immigrants, the earlier waves seem to endure impact from more recent waves. The report done then by the Academy of Science also indicates that evidence points to the conclusion that there is only a small if any adverse impact of immigration on the wage and employment opportunities of competing native groups. According to Longley (2005) Due to California’s need and use of immigrant workers there is a huge cost associated to the support of immigrants which includes incarceration and healthcare.

    According to a recent study performed by the Federation for American Immigration Reform (FAIR) the study took a look at what is spent on things like incarceration, healthcare an education. The study indicated that over 10 billion dollars is spent annually for human services in support of immigrants. The study also indicates the California has an addiction to cheap labor and which is affecting the economy adversely, by in effect causing the middle income tax base of workers to decrease. The study did not specify where the data came from nor was specific data provided to support the findings.

    In a recent article originating in the LA times there is a very recent push in support of a proposal set forth by San Diego political activist Ted Hilton. The proposal follows Proposition 187 that was intended to bar illegal immigrants from public benefits and was found to be unconstitutional is being backed by Barbara Coe one of the original developers of Proposition 187, quoted in the LA Times article, Barbara states. “We will be out in full force to qualify this initiative [for the June 2010 ballot]………Illegals and their children are costing the state billions of dollars.

    It’s invasion by birth canal. ” The major reason for the decision in opposition to allowing the implementation of Proposition 187 is what is written into the 14th Amendment to the Constitution says “All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. ” Supporters of the newest proposal feel that Illegal immigrants do qualify to be under the jurisdiction described above therefore do not qualify for benefits. The article goes on to say that

    State officials however have estimated that the immigrant residents add an additional 4 to 6 billion dollars in cost to education, incarceration and healthcare, but add that these same immigrants also pay taxes and contribute labor. In an effort to keep this most recent proposal from being viewed as racially motivated additional language has been added to include barring, US born parents from collecting state welfare and services if they do not meet eligibility requirements or meet guidelines around not being or seeking employment of drug abuse.

    Some indicators show that even with California’s current weak economy that immigration in the state has not slowed down a great deal due to the agricultural business within the state that still requires the support of immigrant labor. Figure 1 shows a great concentration of positive (added) population in the majority of California counties, ranging from 6% to greater than 13% additional immigrated peoples in those counties. The counties with the highest percent change are agricultural in nature and explain the higher incidence of immigration. igure 1-The map below shows New Immigrant Population changes across the country with California show the highest number of counties with increase and this is primarily to do withy agricultural jobs available. Source: Department of Agricultural Economics and Rural Sociology and the Population Research Institute, Pennsylvania State University This table clearly indicates that California of all states has the greatest number of undocumented workers and therefore impact from decreasing immigration has untold ramifications.

    Source: Department of Agricultural Economics and Rural Sociology and the Population Research Institute, The Pennsylvania State University |States with Largest Unauthorized Immigrant Population in 2008 | | |Estimated Population | |Us Total |11,900 | |California |2,700 | |Texas |1,450 |Florida |1,050 | |New York |925 | |New Jersey |550 | |Arizona |500 | |Georgia |475 | |Illinois |450 | |North Carolina |350 | |Virgina |300 | In conclusion it is important to realize that any sizable change in immigration population in California would have massive impact. Positive impact of a reduction in immigrated peoples would be a reduction in cost to the state from a decline in of usage of public services such as education, healthcare, incarceration, and state welfare benefits. The negative impact of reduction in immigrated peoples would be the lack of work force to bring crops into the marketplace that allows commerce to continue in this great agricultural state.

    Acts of reduction should be considered and studies and statistics that are unbiased before we act on closing our borders to immigrants of any country to our great state. References http://www. dallasfed. org/research/papers/2003/wp0302. pdf, Retrieved May 29, 2009 http://seattletimes. nwsource. com/html/nationworld/2009485818_immig17. html. Retrieved May 29, 2009 JMK (2007) http://workingclassconservative. blogspot. com/2007/05/illegal-immigrations-impact-on-wage. html. Retrieved May 29, 2009 Tigerman, N. , (1988) Health Beliefs, Knowledge and Health Seeking behaviors of recently immigrated Central American mothers in Los Angeles (California). (235 p) Retrieved May 29, 2009, from EBSCO HOST database. 29, 2009, from Business Insights database.

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