From: Martin Witkerk [Email him]
Regarding my review of Mr. Vargas Llosa’s Global Crossings, the reader will recall the author’s odd argument that higher wages would put American workers out of work:
If fewer foreigners were employed in production, natives would have to be paid higher wages, which in turn would force prices for those goods and services to rise.
People would then consume less of them, leading to a loss of jobs for natives.
I later ran this reasoning past VDARE.com’s own Ed Rubenstein. Here is what he had to say:
The assertion that higher native wages would be a bad thing for the economy is, as Martin Witkerk suspects, nonsense.
If mass immigration of unskilled immigrants were to cease, two things would happen: wages of unskilled natives would increase, and employers would look for ways to produce more goods with fewer of these suddenly more expensive native workers. Employers would invest in equipment and technology that would increase the productivity of native workers – i.e., enable them to produce more stuff in less time.
Higher wages paid to native workers would be offset by their increased productivity, thereby obviating the need for employers to raise prices. The standard of living of native workers would increase.
Of course, most employers would rather avoid the expense of investing in new technology. They want unlimited access to cheap, easily exploited immigrants – thereby keeping profits high and wages (for native-born and immigrants alike) low.
Martin Witkerk is an independent philosopher.
