Let Their People Come?

A few weeks ago the New York Times profiled Harvard economist Lant Pritchett. In the piece, they discussed Pritchett’s views on the globalisation of labour: the idea that, just as capital and goods should be allowed to move freely around the world, so should people. He advances the view that this would go a long way to alleviating the problems of the Third World; that a guest worker program in rich Western countries would help the poor but also help address the labour shortages that exist in some countries (and the labour shortage that will exist in some countries due to our aging populations).

The basics are simple: The rich world has lots of well-paying jobs and an aging population that cannot fill them. The poor world has desperate workers. But while goods and capital can easily cross borders, modern labor cannot. This strikes Pritchett as bad economics and worse social justice. He likens the limits on labor mobility to “apartheid on a global scale.” Think Desmond Tutu with equations. The key to breaking the political deadlock, Pritchett says, is to ensure that the migrants go home, which is why he emphasizes temporary workers (though personally he would let them stay). About 7 percent of the rich world’s jobs are held by people from developing countries. For starters, he would like to see the poor get another 3 percent, or 16 million guest-worker jobs — 3 million in the U.S. They would stay three to five years, with no path to citizenship, and work in fields with certified labor shortages. He assumes that most receiving countries would not allow them to bring families. Taxpayers would be spared from educating the migrants’ kids. Domestic workers would gain some protection through the certification process. And a revolving labor pool would reach more of the world’s poor.

In effect, Pritchett is proposing a Saudi Arabian plan in which an affluent society creates a labor subcaste that is permanently excluded from its ranks. His does so knowing full well that his agenda coincides with that of unscrupulous employers looking to exploit cheap workers. Many migration advocates oppose a plan, now dividing Congress, to create a guest-worker force a 15th as large as the one Pritchett wants, saying it would create a new underclass. But Pritchett calls guest work the only way to accommodate large numbers. … “Letting guest workers in America doesn’t create an underclass,” he says. “It moves an underclass and makes the underclass better off.”

In this interesting article at Reason Kerry Howley writes:

The simultaneous opening of markets for goods and closing of markets for labor has sparked a strange dissonance in debates about free trade. The same Republicans who will go to the mat for your right to buy cheap widgets from Bangladesh will fight as hard to keep the widget makers safely behind the fence. Burmese kids are watching pirated copies of Pirates of the Caribbean and reading translations of Harry Potter novels, but bureaucratic barriers to mobility loom larger for them than they did for their great grandparents.

Pritchett’s book Let Their People Come: Breaking the Gridlock on Global Labor Mobility can be bought or downloaded from here.

And last week, Australia’s Dr Mirko Bargaric offered a variation on the idea:

The best way to ameliorate third world poverty is by massively increasing migration to the west. Left to their own devices many people would gravitate to life sustaining resources, leading to a rough equilibrium between the world’s resources and its population.That’s not to suggest that Africa would empty overnight into the western world. Some of its citizens are too destitute to hobble to a more plentiful border. Some will not want to come, in any event. But huge numbers will follow the yellow brick road to prosperity in the west.

There is one fundamental obstacle to western nations relaxing border controls: racism. Discrimination on the basis of race is the lynchpin of the whole of western migration policy.

There are, of course, other obstacles to both suggestions: under the Bargaric plan, there could be a significant burden placed on the welfare state and public infrastructure of the country; and, under the Pritchett plan, there is the risk that these ‘guest workers’ would simply never return home and that Western governments would not have the willpower (unlike, for example, Saudi Arabia) to deal with what might become a politically sensitive problem. However, none of these obstacles are insurmountable and many of the risks can be mitigated against.