Borders open to inclusive prosperity – El Sol de México

In a globalized world, it is natural and desirable for all resources to flow freely: capital, goods, technology and people. Genuinely liberal minds do not question this principle. However, in the United States there are many voices that seek to blame immigrants, especially Hispanics, for their problems.

But while many governments decide to restrict migratory flows, “Open borders: the science and ethics of immigration”, by Bryan Caplan and Zach Weinersmith, allows us to know solid arguments: economic, fiscal and cultural, as well as ethical considerations, in favor of the free mobility of people.

The book indicates that although real annual income in the world has practically doubled in the last 35 years, and the global poverty rate has been reduced by more than two thirds in the same period, there is a great disparity between countries that could be significantly reduced if free international migration is allowedbenefiting both migrants and receiving communities.

The conclusion is very simple: with open borders, global wealth increases considerably. It is a rare example of a public policy that improves the well-being of virtually everyone.

When a worker migrates to a country or region with a relative abundance of capital, that is, with a large number of companies equipped with technology, labor productivity increases and more goods and services are generated in that economy.

A more productive person will eventually have a higher salary, which contributes to increasing the aggregate income of the recipient country and wealth in the world. In fact, the same thing happens when there is free labor mobility within the national territory—say, from the countryside to the city—where the urban worker benefits from technology and can produce more and, therefore, earn more than in the rural environment.

The impact for the country that receives the migrant is very favorable and can be measured precisely through the net present value (NPV). It has been demonstrated on several occasions that the NPV of a young migrant, that is, the wealth he or she generates for the country throughout his or her life, in constant terms, less what the State invests in his or her well-being, is positive—even if the migrant is low-skilled—so not only is the person who migrates in a better situation, but the public finances of the country that receives them also tend to strengthen.

In the case of elderly migrants who do not generate a positive NPV, far from prohibiting them from migrating, they can simply be charged higher taxes or an initial contribution, which compensates for the higher cost they represent for public finances, until their net value becomes positive. generated.

In many countries the argument prevails that “a greater number of people, competing in the labor market with already established workers, tends to reduce the equilibrium wage and damages the income of local families.” The reality, however, is that migrants, being employees, will increase their consumption, so companies will hire more collaborators to satisfy the new demand and the market salary will eventually tend to increase.

An additional argument used against free migration is that it causes a negative impact on public finances since the cost of public services increases.

However, in most cases it is not necessary to increase the supply of public goods if the population increases and the cost of providing them remains relatively stable. An example is the army, which with the same budget protects few or many citizens indifferently. Another example is public lighting—the fact that many people simultaneously use a resource is the very definition of a public good.

On the other hand, a large number of social programs such as pensions and health systems are pyramidal, that is, they depend on a large number of young people supporting older people, which implies that, given the population structure of In several developed countries, with a significant proportion of adults of advanced age, migrants are required to contribute resources to cover the increasing costs of pension systems that would otherwise be in deficit.

In the area of ​​social fabric and healthy coexistence, migration is also very positive. Statistics indicate that crime rates among migrants are lower than among those born in the receiving country. In fact, the rate of immigrants imprisoned in the United States is a third lower compared to Americans by birth.

On the other hand, for those who indicate that migration generates cultural disintegration, the authors’ response is that migrants quickly assimilate the language and social values ​​of the country that receives them, in addition to generating a cosmopolitan environment that enriches cultural life and in turn generates economic well-being.

Migrants tend to improve their diet, health and education, which strengthens them physically and intellectually, increasing their human capital. In addition, open borders promote equal opportunities and allow the individual talents of locals to be promoted. A clear example is the European Union, which makes it easier for each citizen to use their capabilities where they are most productive across an extensive and diverse geography, which increases specialization and promotes the creation of wealth throughout the entire continent.

At Grupo Salinas we seek to promote the progress of communities, and we promote the free mobility of people as a fundamental tool to expand employment opportunities and labor productivity, which allows us to better satisfy the needs of society and strengthen the income of communities. families.

Although it is true that this mobility was affected by the restrictions imposed by different countries as a consequence of the Covid-19 pandemic, the reality that drives people to migrate to seek better living conditions persists and has even become more pressing, so the ideas of Bryan Caplan and Zach Weinersmith are more relevant than ever: we need to prioritize the freedom and respect of people who bravely leave their homes in search of more just environments, to create true Inclusive Prosperity.

President and Founder of Grupo Salinas


Twitter: @RicardoBSalinas

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