The raw emotions generated by immigration policy—provoked by heartrending stories of families torn apart by deportation, or citizens murdered by illegal immigrants—have scrambled political allegiances and confused public debate. Republicans, usually the champions of family values and small government, now want to restrict family reunification and give bureaucrats the power to screen people who want to enter the country. Democrats, traditionally the allies of the working class, want big business to select immigrants and have given scant attention to the legitimate interests of working-class natives.
The only way to end this politically charged debate is to think carefully about benefits and costs as well as politics and perceptions. We need a new immigration system that offers liberal admission policies but targets its benefits to native workers rather than corporations.
Economic research provides little doubt that immigration benefits our economy. Highly educated immigrants offer their skills, entrepreneurial drive and much-needed expertise our most important industries. Low-skilled migrants are willing to do back-breaking but vitally important labor that most Americans refuse. Both types bring their purchasing power, which increases the demand for American services and American-made goods, and their cultural heritage, which enriches ours.
The problem posed by migration is that the benefits are not evenly distributed. They flow to the migrants themselves and the corporations that hire them. Consumers do receive better products and lower prices, but ordinary people don’t really perceive these benefits. And working-class people may suffer a decline in their wages (some or many of them, depending on which economist you ask, but most agree the decline is not large), or (certainly, in most cases) believe that immigration undercuts their wages and threatens their cultural values.
So, immigration expands the economic pie but gives too meager a slice to ordinary people. The goal must be to retain, and in fact expand, immigration while ensuring that its benefits are distributed fairly. The current system does the opposite: channeling the benefits of migration to immigrants and domestic elites. Right now, special classes of citizens—mostly corporations (and in practice, big corporations) and family members—can sponsor temporary or permanent migrants, benefiting shareholders mainly, as well as ethnic enclaves.
This system should be wiped away and replaced with a system of citizenship sponsorship for immigrants that we call a Visas Between Individuals Program. Under this new system, all citizens would have the right to sponsor a migrant for economic purposes.
Here’s how the program would work: Imagine a woman named Mary Turner, who lives in Wheeling, West Virginia. She was recently laid off from a chicken-processing plant and makes ends meet by walking and taking care of her neighbors’ pets. Mary could expand her little business by hiring some workers, but no one in the area would accept a wage she can afford. Mary goes online—to a new kind of international gig economy website, a Fiverr for immigrants—and applies to sponsor a migrant. She enters information about what she needs: someone with rudimentary English skills, no criminal record and an affection for animals. She offers a room in her basement, meals and $5 an hour. (Sponsors under this program would be exempt from paying minimum wage.) The website offers Mary some matches—people living in foreign countries who would like to spend some time in the United States and earn some money. After some back and forth, Mary interviews a woman named Sofia who lives in Paraguay.
Sofia, who grew up in a village, has endured hardships that few Americans can imagine. She is eager to earn some money so that she could move to her nation’s capital city and get some vocational training. A few weeks later, Sofia arrives in Wheeling, after taking a one-week training course on American ways. If things don’t work out, the agency that runs the website will find a new match for Sofia, and Mary will find someone new as well.
While the program might seem crazy at first, it would not be that different from the existing H1-B program, except that individuals like Mary rather than corporations like Google and Exxon would sponsor the workers. Second, the program is not that different from the au pair program run by the State Department, nominally under the J-1 cultural exchange visa program, but in reality a nanny migrant-labor program used by upper-middle class American families.
A Visas Between Individuals Program would extend the benefits of these types of immigration programs to everyone, rather than just to corporations and the affluent. It would also achieve the goals of both sides of the immigration debate—better than their own proposals do. Immigrants would no longer have special privileges to sponsor family members, while working-class voters would enjoy dramatic benefits.
According to our calculations, a typical family of four could boost its income by $10,000 to 20,000 by hosting migrants. The reason is that migrants to the United States usually increase their wages many times, allowing them to pay as much as $6,000 to hosts for sponsorships (and our average family could sponsor up to four visas, one for each member).
This financial benefit for working families would be a larger increase in income than they have received over the last 40 years of economic growth. (Median household income in the United States was about $50,000 in 1977 and is roughly $59,000 today.) At the same time, a Visas Between Individuals Program would be true to Republican free-market and small-government principles by drastically reducing the role of government bureaucrats, who would merely run security checks on migrants rather than trying to evaluate their likely contributions to the economy.
Many people will worry that the Sofias of the world would be exploited by their sponsors. But all health and safety laws would apply to them, and periodic inspections could be undertaken (as exist for the J-1 au pair program, where admittedly occasional exploitation also occurs). Yes, Mary would be able to pay Sofia less than the minimum wage, but even at $5 an hour, Sofia would earn many times what she earns on a farm in Paraguay. Sofia would be free to leave at any time if she did not like the conditions of her employment. Effectively, this system allows the benefits of exchange in international labor that are permitted by online labor markets like Fiverr and Amazon Mechanical Turk to extend to a much broader range of tasks that need to be done in person, from dog walking to construction work.
Wouldn’t lower-income Americans oppose a Visas between Individuals Program because of fears that these immigrants would take away their jobs? At first, maybe. But they would soon realize that they can use the program to make money for themselves. Like Sofia, many Americans would like to start or expand small businesses. Others might try, in entrepreneurial fashion, to find foreign workers for American businesses—which would not be allowed to sponsor migrants under our proposal—taking a cut in the process. Google and Exxon would need to pay people like Mary to find migrants for their businesses. Other Americans would sponsor migrants for low-skilled agricultural work, or to work in factories that move back on shore to take advantage of newly available cheap labor, or to work in their own businesses. A great free market using migrant labor would flourish, creating new jobs for working class natives as supervisors and agents. (Wealthy families could sponsor migrants, too, but there are fewer of them, and they would likely find a $6,000 boost in income not worth the trouble—while the money would be a tremendous gain for sponsors with more limited prospects.)
One of the most fascinating findings of social scientists is that the people who oppose immigration the most are not those who live among migrants. The fear of migrants is largely based on ignorance about who they are. That’s why people who live among migrants tend to support immigration or not to oppose it too much. By making sponsorship accessible to all Americans, a Visas Between Individuals Program would spread migrants throughout the United States rather than concentrating them in Silicon Valley, the big cities, and certain agricultural areas near the southern border. Sponsors will normally want the migrants they sponsor to live near them. Or Americans might move to areas of high migrant demand to take advantage of the opportunity to sponsor migrants there. It is hard to demonize the person who lives in your basement, or the basement of your neighbor, and has increased your income greatly. Most migrants, even those who came here illegally, obey the law and work extremely hard, in ways that are hard not to admire.
A Visas Between Individuals Program would offer advantages to working people, while preserving America’s historic commitment to immigration. Democrats should understand that it would increase the wealth and well-being of low-income Americans and impoverished foreigners, while Republicans should appreciate how it would contribute to economic growth, which offers benefits to all. Moreover, a Visas Between Individuals Program does so in the spirit of the market, by allowing every citizen to choose how she uses her right to sponsor visas rather than allowing corporations or governments to manage migration. The program puts the burden of responsibility and choice as well as the freedom to profit on hard-working Americans who seek to better their lot.
Immigration is just one of any number of social problems that can be solved with what we call “radical markets.” By exploiting the logic of the market in an area that is normally bureaucratized, we can advance equality as well as economic growth.