Sunday, April 30, 2006

Zimbabwe: I want you back?

Fast track land reforms have put Zimbabwe's agricultural production on a fast track to disaster. After historical farm owners (virtually all white) lost the protection of the Lancaster Amendment in 1990, Zimbabwe began systematically taking land from whites and redistributing it to wealthy, well-connected blacks. Like affirmative action in the US, this did nothing to help the impoverished masses. So in the late nineties and early years of this decade, a fast track resettlement program was implemented that targeted almost nine million hectacres to be turned over to mostly "landless people". As white farmers were forced out of Zimbabwe, many moved to neighboring countries like Mozambique and hastily turned brush into productive farmland.

An unemployment rate of 80%, an AIDS rate of 25%, staggering GDP shrinkage of 7% per year, and conflict with the West put President Mugabe in a desperate situation. Recipients of the transfer program have not even come close to keeping production up at the rate whites did:

By confiscating the white-owned commercial farms, the government transformed a country that was once the breadbasket of Southern Africa into a net food importer.

And despite good rains there is every prospect of another deficit over the coming season, our correspondent says...

Tobacco used to be Zimbabwe's major export earner but production has fallen from 237m kg in 2000 to 73m kg last year.
That is depressing. Sixty-six percent of Zimbabwe's workforce is employed in agricultural but the country cannot even feed itself.

Mercifully, some of the 4,000 white farmers who lost their land to the kleptocracy may be trying to come back, while those remaining must apply for permission to continue farming:

Buka said 500 white farmers had applied for permission so far.

There's been confusion in recent weeks over unconfirmed reports Zimbabwe had invited white farmers chased from their farms back to the land.

Government ministers have denied this is a dramatic U-turn in Zimbabwe's land reform programme, which has seen up to 4,000 commercial farmers lose their farms in the past six years.

Buka said 'remaining farmers' had to apply for leases to farm, following changes to Zimbabwe's constitution that make all agricultural land required for resettlement state land.
Zimbabweans were better off when their country was called Rhodesia:
Zimbabwe is now poorer than it was at independence in 1980, after it had survived 16 years of sanctions and eight years of civil war.
Zimbabwe's IQ is estimated at sixty-six. The difference between white and black Zimbabweans (~35), then, is likely greater than the difference between Ashkenazi Jews and African Americans in the US (~30). The result of throwing out 4,000 enterprising whites should have been predictable. African independence from colonial rule has been terrible for Africans.

The government is nationalizing all the farmland and then granting people the right to farm it. The white commercial farmers still operating in Zimbabwe are in a tenuous position, as are those who wish to return. It is obvious that Mugabe is not interested in the whites' well being. Whites in Zimbabwe are a quintessential market dominant minority with little political protection. Mugabe will cater to them only in economic desperation. But political desperation will continue to force him to be capricious toward whites. Sad purges like operation "Remove the filth" are coupled with the plundering of wealthy whites who deflect the ire from Mugabe. Why even one thousand white farmers remain is difficult to understand:
The programme has been mired in controversy following allegations ruling party officials had seized most of the best farms, while agricultural production has plummeted.

Meanwhile, in central Midlands province, at least six white farmers have been told to leave their farms in the past two weeks, an official from farming pressure group Justice for Agriculture (JAG) said.
Southern Africa demonstrates the deleterious effects on social cohesion, personal liberties, and economic progress that stem from having an impoverished numerical majority that doesn't control the economy. The closest a majority white US comes to this is the prominence of Ashkenazi Jews in industries such as entertainment, media, and banking/finance. But American goyim are not poor, Jews do not have a lock on any industry, Jews are scarcely distinguishable from other whites, and the US celebrates economic success more than anywhere else in the world save maybe Hong Kong. Rather than deporting our brightest, we praise and admire them.

If current demographic trends continue, however, whites will become a market dominant minority as the wind from the South howls northward. The Hispanic underclass does not appreciate American culture and does not revere white accomplishment. We need a wall.

We should also create tax incentives for wealthy natives to have more children. Not only will this raise the national IQ and narrow the wealth gap, it will make the Western way of life sustainable for future generations. The West is dying--the populations of both Japan and Russia are decreasing in absolute numbers, and in all of the developed world only Israel is above replenishment rate. The planet is being populated by dullards--births per woman by country inversely correlates with national IQ at a higher rate than virtually any other variable. Allowing sharp children to take accelerated classes in primary school and burn through college faster will put more years on the other side for making babies. Also, older folks should put money away for their children and grandchildren in high-return, long-term investments. It's a much better gift than sneakers or some electronic consumable.


Saturday, April 29, 2006

Drug legalization in Mexico

This isn't going to help achieve to victory in the war on drugs:
Mexico's Congress approved a bill Friday decriminalizing possession of small amounts of marijuana, ecstasy, cocaine and heroin for personal use.
The Mexican Congress claims that it will allow Mexican authorities to focus on smugglers rather than casual users, but Mexico's endemic corruption and the thirty some-odd billion dollars generated from the drug trade evince the risibility of such a claim. Northern Mexico is still run by drug cartels--legalizing possession is obviously not going to hurt business. Mexico exports drugs and social problems to the US in return for $17 billion in remittances and several billions more in narcotics sales. The Mexican government is not a friend.

These are not innocuous quantities:
The bill says criminal charges will no longer be brought for possession of up to 25 milligrams of heroin, five grams of marijuana — about one-fifth of an ounce, or about four joints — and half a gram of cocaine — about half the standard street-size quantity, which is enough for several lines of the drug.
The bill passed the Mexican Senate by a majority of over two-to-one. Most Mexicans favor this move. This is yet another reason that massive Mexican immigration to the US is bad. Drug use externalities do not benefit society. It hammers lower income, less endowed folks especially hard. We have witnessed the devastation the crack wars of the late eighties and early nineties wreaked upon our urban centers. Why make life even tougher for those already fighting an uphill battle?

Building a wall and militarizing the border will severely cut down on the importation of both underclass liabilities and drugs.


Thursday, April 27, 2006

Catch and release nonsense

Writing about the recent IFCO crackdown, John O'Sullivan points out that most of the illegal aliens apprehended were promptly released:

For even before Chertoff had spoken (but not before blogger Michelle Malkin had predicted it), four-fifths of the illegals arrested had been . . . released.

Two hundred and seventy-five of them were deported. The rest were sent away in return for a promise to return for a court hearing. Many, probably most, will disappear. And since the government's computers were "down," their brush with immigration enforcement may not even be officially recorded. They are home dry -
well, dry anyway.
Obviously the migrants won't return for trial. The hypocrisy is staggering. Only a few weeks ago, Chertoff spoke of how hollow catch-and-release is:
"If we catch them and release them ... we suggest to people that if they can get across the border they are home free and safe from being returned. We want to send a very different message," Chertoff told reporters.
This followed news that 39,000 illegal Chinese immigrants are to be repatriated. We can effectively extradite tens of thousands of migrants halfway around the world to a communist society we putatively object to, but the most we can muster when it comes to the big amnesty PR push (if ever Bush was to get tough this would be the time) is a paltry 275. Booting the Chinese is more expensive in per capita freight, but the opportunity costs involved reveal the real deadweight. The median income for Mexican males in the US: $20,814. For Chinese males: $40,423 (both from 2000). Mexicans using public assistance: 6.8%. Chinese: 3.5%. Mexico's estimated IQ: 87. China's: 100. Inanity.

Meanwhile, President Bush constructed an impervious argument against deportation rendering its stultified supporters useless:
"Massive deportation of the people here is not going to work," Bush said as a Congress divided over immigration returned from a two-week recess. "It's just not going to work."
Well I'm convinced.

Of course it would work. It's working for 39,000 Chinese. It worked for 275 in a couple of days. If history is any indicator, the number forcefully removed would be dwarfed by the number leaving of their own volition:

The INS claimed as many as 1,300,000, though the number officially apprehended did not come anywhere near this total. The INS estimate rested on the claim that most aliens, fearing apprehension by the government, had voluntarily repatriated themselves before and during the operation. The San Antonio district, which included all of Texas outside of El Paso and the Trans-Pecos,qv had officially apprehended slightly more than 80,000 aliens, and local INS officials claimed that an additional 500,000 to 700,000 had fled to Mexico before the campaign began.
The numbers are difficult to substantiate, but the general trend is clear. For every one forced out another seven or eight will leave voluntarily. If we use that ratio with a daily deportation of 275 during working days (Mon-Fri only), 600,000 or so illegal immigrants would go home each year. Punitive fines, a wall, and militarization of the border would augment this estimate.

Perhaps you think it will work, but that it will Gestapo-like, leaving a sordid taste in your mouth. But there's no need for home raids or the interrogation of good Samaritans. Simply removing illegals who are caught breaking another law (using phony social security numbers, being cited for traffic violations, failing to report income, etc) would do the trick.

Bush's ability to make a cogent argument parallels his ability to act clandestinely, as an aide for one of the Senators present at a meeting in which Bush endorsed their amnesty proposal reveals:
An aide to one participant said that Bush told the senators that he could go no further publicly than his veiled support for the Senate bill because to do so would anger House Republicans.
Bush doesn't care about his constituency. He's willing to sell the Republican Party down the river on an incredibly idiotic strategy that is sure to fail. Republicans are not going to win over Hispanics. As Republican pols shift left, the Democrats will move in tandem with them. Increasing revenue is not good if the marginal output of each unit is negative. The Republican Party should instead aim for white working class natives who are being hammered by unskilled immigration and who are uncomfortable with the Democratic Party's continual movement to the left on other social issues. They'd probably pick up a bit of the black vote in the process.

Maybe there's some reason to be optimistic. IFCO is still embarrassed and several managers face fines potentially stretching into the millions of dollars. The public has seen how expeditiously 275 migrants can be deported. The longer it takes for the Senate to send a bill back to the House the more likely it is that House members will remain tenacious as November binds them closely to the public.


Sunday, April 23, 2006

IQ and PPP or procreation?

Corruption and economic freedom each provide considerably more insight into the wealth of nations than national IQ does. The individual correlates of the three variables with PPP, all of which are statistically significant, are .82, .75, and .60, respectively (using the most recent figures). When all three are run against PPP in a multiple regression, the correlation only nudges up to .83. Not surprisingly, controlling for corruption virtually eliminates the effect of IQ on a nation's PPP (IQ's P-value becomes .48, meaning it's a cointoss as to whether or not the relationship between IQ and PPP is random, although the questionable relationship still trends in a slightly positive direction, with each additional IQ point leading to a $68 increase in PPP compared to $1,825 when corruption and economic freedom are not considered).

Economic freedom also becomes much less important (P-value of .18), although it is a pretty good proxy for the corruption index (which hones in more on IQ). After controlling for IQ and economic freedom, each point on the Transparency International Corruption Index (scaled with ten being squeaky clean and zero showing absolute corruption) ups PPP just over $3,300, down from $4,300 without controlling for IQ and economic freedom.

Corruption and IQ are inversely correlated of course (with an r of .68). Thus IQ "explains" about 46% of the variance in corruption levels and viceversa. But there's more to do with PPP in the 54% remaining on the corruption side than on the IQ side. It appears, then, that IQ likely helps goad citizens into collectively demanding rectitude in business and politics but that realizing such rectitude is significantly more important than IQ, at least at the national level.

I add the caveat because I suspect globalization is a steroids for corruption and a sedative for national IQ. As MNCs and entrepreneurs increasingly expand overseas, they play a correspondingly larger role in the economic development of the host country. They pour investment in, create local jobs, and help open up external markets. Foreigners with high IQs make dull nations wealthier. If a military junta threatens to take control or lots of grease is required to get the gears to turn, however, the MNCs and other business entities are hesitant to enter. So a lack of corruption lets in smart people who augment the nation's wealth without raising its IQ. IQ is still a powerful force, but the way it's been measured isn't optimal (for PPP anyway). The UAE epitomizes this (found here):

In the UAE as a whole, with a total population of 2.5m, nationals are outnumbered seven to one by mainly non-Arab aliens: 1.2m Indians, 600,000 Pakistanis, 100,000 Iranians and contributions from dozens of other nations, including 50,000 Britons. In Dubai, nationals fall to a mere 8% out of a million-plus.
The IQ tests Lynn and Vanhanen used span a long period of time. Presumably, the test results were not found by testing foreigners. How much, then, does the IQ of the natives matter in the UAE? By letting in big corporations full of sharp people, the UAE is doing more for its PPP than taking a magic pill to boost its IQ from an estimated 83 to a Russian 96 would do if the pill's side effects included Russia's level of corruption and state control.

The UAE, as a quasi-corporate-owned state, is an extreme example, but globalization is trending us toward more of them. In a critique of Lynn and Vanhanen pointed out to me by John Bolton, we see that IQ correlated with PPP at .76 in 1998 while economic freedom correlated with IQ at only .68. Recall from above that those correlations have now basically swapped positions. I haven't found corruption data for 1998, but I suspect its correlation with PPP has increased over the same time period that the link between IQ and PPP has been attenuated.

The second paranthetical caveat is due to the variables for which a nation's IQ definitely can shed some enlightenment--making babies and dying. Births per woman correlates with IQ at .81. Life expectancy correlates with IQ at an astounding .85. Economic well-being and the number of doctors per capita don't hold a candle to IQ. The correlation between both of these together and life expectancy is only .72. When IQ is controlled for, PPP loses statistical significance and doctors per capita loses 80% of its correlation strength. This is, incidentally, the highest single variable correlation with national IQ I've yet seen--are there any others that are stronger?

Taking births and life expectancy together yields a correlation with IQ of .88. Controlling for one does not eliminate the statistical significance of the other. My theories on why:

-Smart people take better care of themselves. They are more likely to engage in healthy eating habits, exercise regularly, and get enough sleep, less likely to partake of behaviors they know to be damaging, etc. Seeking out this information and understanding it takes some level of intelligence. And because the benefits are long-term in nature, duller people are less likely to engage in them.

-As for births per woman, I've expounded a little on this before. Bearing and raising children takes an enormous amont of time. Smarter people are more likely to grasp the commitment required in producing offspring. These smart people have a perpetually growing number of other options that require a prodigious commitment as well. They can blog, day-trade, game, travel, program, learn an endless amount about an endless number of subjects via the internet, etc. Duller people, even with more money, are less likely to be self-starting in these activities and less likely to fully grasp how having children will hamper their ability to partake in the same activities. So the distractions of a high IQ society do not deter them as much from having urchins.

(Human Biodiversity)

Friday, April 21, 2006

IFCO slammed for blatant use of illegals

An encouraging sign that the winds are starting to howl in the direction of the sovereignty crowd:
The Bush administration unveiled Thursday what it said is a new strategy aimed at companies employing illegal immigrants, illustrating it with a crackdown on the German-based firm IFCO Systems.

Law enforcement officials will "use all the tools we have, whether it be criminal enforcement or immigration laws to break the back" of businesses that exploit undocumented immigrants, said Homeland Security Secretary Michael Chertoff at a news conference.
The novel strategy is to vigorously enforce the law. Maybe the critics were wrong about Myers. Not Harriet, Julie. Michelle Malkin derided her for not being experienced in immigration enforcement, calling Myers a "clueless crony" and excerpting that her nomination prompted "sharp criticism from some employee groups, immigration advocates, and homeland security experts." The former two are concerned that she might be a change of pace. And the latter--well, if I had a little more wanderlust and cash I'd love to head down to Mexico with some friends and make a documentary of our group crossing into the US illegally. Their unease sparks hope. Thus far Myers pleases:
"We are turning away from focusing only on civil liability," Myers told CNN. "It used to be in these cases that they amounted mainly to a slap on the wrist or a small civil fine. We're now focusing on criminal cases and bringing as many criminal charges as we can when we find employers that blatantly violate worksite enforcement laws."
Finding them should not be hard. Mastercard and Visa can deactivate cards instantaneously. They will shut you down if you're not following their rules. A social security database should allow ICE the same leverage against employers who try to run defunct or false social security numbers.

This new move comes as a surprise, but it wasn't inconceivable. Nothing is in the immigration debate, where politicians are even more capricious than usual:
Democratic National Committee Chairman Howard Dean yesterday called border security his party's top immigration priority for November.

"The first thing we want is tough border control," he said. "We have to do a much better job on our borders than George Bush has done. And then we can go to the policy disagreements about how to get it done."
Dean isn't popular in the Democratic establishment. His pugent rhetoric easily allows him to be portrayed as a fringe extremist by Republicans, even though his history doesn't bare that out. Vermont is without Hispanics or immigrants--it is not southern California. Dean's abrupt entry onto the national scene came from internet boosters and college activists. The La Razas and Archer Farms of the world don't have him in-pocket.
A Gallup Poll of 1,004 Americans this month found that 81 percent think illegal immigration to the United States is out of control and that 79 percent think it's extremely or very important for the government to take steps this year to halt the flood of illegal aliens.
Of course Dean's words are politically expedient. But his concern for working-class natives is a refreshing break from the trashing they receive on a regular basis from both parties:
"We don't like guest-worker programs," said Mr. Dean, a candidate for the 2004 Democratic presidential nomination. "I don't like guest-worker programs. I think the president's guest-worker program is essentially indentured servitude. It doesn't help the immigrant, and it threatens wages."...

"Don't forget -- the Republicans have been in power for five years. They've had the House and Senate and the White House most of that time. And they have done nothing about immigration."
He is right. The war in Iraq has consumed the political debate for the last four years. But the quagmire and the bromides that accompany it have lost their luster. There's little new to add. Conservatives are coming to terms with how nothing they stand for has been accomplished in the last half-decade and they are rebelling. Working class Democrats (of Pew's three Republican-leaning and three Democrat-leaning typologies, the two strongest opponents of guest working came from the Democratic side) and blacks are getting hammered by the Hispanic underclass importation. The open-border goons can only respond to charges that underclass immigration causes unnecessary pollution, depresses wages, lowers the nation's average IQ, destroys school systems, stresses infrastructure, increases crime, decreases housing affordability, creates communication barriers, and brings in atavistic diseases with brunamagem claptrap about a "land of immigrants" (how'd that turn out for the Native Americans, by the way?) and "jobs Americans won't do" (Econ 101 is not a prerequisite for uttering such nonsense).

Immigration reform is unique in that public support for it spans political, economic (to a point), and racial lines, while at the same time being resisted across the spectrum of the political class. It is the quintessential populist issue. The more vociferous the public is, the more the elites are forced to react. They try to ignore and confuse the issue as much as possible, occasionally throwing out bones to try and placate the rabble.

This enforcement is a good thing. IFCO has both a market cap and an annual revenue of nearly $500 million. It will create anxiety in larger companies that fear they might be zapped next. But the move should have us asking why more isn't being done rather than relieve pressure on the Bush Administration for having finally done something salient. However, it may only be a political ploy designed to diffuse the immigrant debate while simultaneously boosting support for a guest worker amnesty that turns the illegals into legitimate residents so that no more of the mawkish videos linked to in the CNN article have to occur again in the future.

If a legitimate third party forms in the near future, immigration will be its semination. It is crucial we make it the deciding issue in November.


Wednesday, April 19, 2006

Immigration tocsin from Europe

I am both distressed and comforted by Europe's deterioration. Western Europe and the US share a common ancestry, culture, religion, and broad economic system (sort of). If we don't stick together we'll probably hang separately. But if Europe goes off the deep end first, it might provide impetus for the US to avert a lemming's outcome. The Danish cartoons show that multiculturalism restricts freedom and destroys the host culture. The latest French riots presage the difficulty in remaining globally competitive when employment is guaranteed. We're still asleep on the impending senescence crisis, but Europe is older than the US is so we'll hear them scream before the Reaper surprises us. And hopefully Americans will become more skeptical of massive immigration from the south by referencing what is happening on the Old Continent:
BERLIN -- Germany needed workers. Turks needed work...

So starting in 1961, the country invited Turkish ''guest workers" to come do the dirty jobs that Germans didn't want.

Nobody grasped that the country -- and the continent, because neighboring nations soon undertook similar experiments -- was on the brink of a transformation whose effects are still reverberating across Europe.

''The idea, originally, was that the foreign workers would stay for as long as economically necessary, then go home," said Michael Bommes, director of the Institute for Migration Research at Germany's Osnabrueck University. ''It didn't quite go like that."

Of course they didn't. And neither will our guest workers unless a three-pronged system of enforcement (wall/military on the border, harsh punitions for employers who hire, and the involvement of local authorities in deportation and arrests) is, well, enforced.
But more recently, as economic growth has slowed, swelling numbers of Muslim immigrants from the Middle East and North Africa -- many of them arriving without any visas, or overstaying their visas and melting into the ethnic suburbs -- are being blamed for social stresses from urban blight to chaotic schools. In the words of the late Swiss writer Max Frisch: ''We wanted workers, we got people."
What will happen to the construction industry as the housing market continues to cool (and the slowdown is most trenchant in the West)? California's miserable NAEP scores portend the future of the US educational system. Frisch should have done as Randall Parker's been doing and looked to the father of a civilization the US and the Swiss mutually share for a solution. As Plato said through Socrates: "Necessity, who is the mother of invention." Instead of an endless search for cheap labor, companies need to be developing more efficient processes through mechanization and robotization. Machines are workers without being people.
France, in an about-face, has decided it no longer wants to admit the poorest of the poor, just skilled workers who speak fluent French and respect the ideals of secular democracy. Germany and the Netherlands have passed new laws that seem intended to thwart immigration from Islamic lands -- with potential newcomers queried about attitudes toward women's rights, Jews, and gays.
This is an obvious response of sovereign nations that are concerned with bettering the lives of current residents, not bettering new comers at the expense of natives. Prudent advice for investors: Don't invest in mutual fund families that advertise. The money you give will be used to bring in more money for the fund rather than growing your investment. Prudent advice for voters: Don't vote for politicians that sell you out to import more supporters. Power will be used to preserve power rather than improving your lot.

Why compromise Occidental culture? Why suppress wages, bring in atavistic diseases, stress infrastructure, increase crime, accentuate the wealth gap, make housing less affordable, create communication barriers (and the deadweight loss that comes from native college students majoring in Spanish instead of architecture or engineering), and prop up the economy of a corrupt Mexico?
Europe's guest worker programs were mostly scrapped during the recessions of the 1970s, but in a pattern reflecting the Hispanic flow into the United States, the movement of Muslims to Europe only accelerated. Those early guest workers routinely overstayed their one- or two-year permits, or lived from extension to extension, but faced scant risk of deportation unless they committed serious crimes.
Latin American economies are tied to the US economy. NAFTA, CAFTA, and other hemispheric trading agreements strengthen the interdependency. Living through an American depression beats living through a Nicaraguan depression. When the economy no longer has a short-term use for them, underclass immigrants are still going to come and stay.
While many European governments failed to seriously pursue integration, many Muslim immigrants were equally unwilling to shed their own languages and national identities.
A nation within a nation. Sound familiar? Instead of half-heartedly attempting to integrate immigrants after they arrive, why not demand that they be linguistically, culturally, economically, and educationally integrated before they arrive? Build a wall and institute a merit immigration system that forces them to be so.
Indeed, the future of the continent may be written on these darker-skinned faces thronging the streets. Birth rates in some European countries are plunging dramatically. Immigrants earning wages and paying taxes appear to represent the best chance the continent has of keeping its place in the world's economic front ranks.
No, finding ways to get Europeans to have babies and remain productive as the population ages is the continent's best shot. That third-worlders must be imported to do low-skilled jobs that otherwise will not get done is a hard propisition to swallow with an EU unemployment rate of 9.4%. If a group is a net liability, bringing in more of them does not ameliorate the situation, it makes it worse.
Many of the original guest workers are now retired, enjoying the comfortable pensions that are the pride of Europe. But their children and their grandchildren are trapped between two worlds, too ''Europeanized" ever to return to the Middle East or North Africa, but lacking the language skills and education to forge ahead in their new countries.
Are the children of brown serfs going to happily toil away picking fruit in Californian sun for $5 an hour? Or are they going to desire opulent lifestyles that they do not have the ability or diligence to obtain? The latter. And they are going to resent it.
The progeny of the early workers are filling schools -- and, critics say, jails -- as well as putting heavy demands on social services. The legal status of the offspring is murky, with many entitled to social services and health care without holding citizenship.
The only difference is that the US grants birthright citizenship and therefore makes it easier for spawns to receive services.
At the rough-and-tumble Ruetli vocational high school in Neukoelln, where 80 percent of students are of immigrant stock, not a single student from last year's graduating class went on to specialized training or an apprenticeship, the normal routes to decent-paying, blue-collar jobs.
Mexican-Americans attempt secondary education at only a fifth the rate of other Americans. Only 53% of Hispanics graduate from high school in four years, compared to 77% of whites and 55% of blacks. Do we want another black underclass that happens to be brown?

The interregna of my excerpts are full of quixotic fluff about how if only integration and understanding would truly occur all would be well. A German politician of Turkish descent criticizes the perceived hardline stance against immigration taken by the US government (are you kidding me?). He laments a country of such historically successful integration questioning unfettered immigration. If the US, with race-based prison riots, witch hunts, affirmative action, criminals waving foreign flags in the street, intractable education, economic, and criminal ethnic/racial gaps, etc is to be considered a success, I shutter at the thought of integrative failure.


Tuesday, April 18, 2006

Borjas in WSJ on immigration and wages

The WSJ editorial board is moderating its advocacy of open-borders. Recently they finally admitted that the phrase "Jobs Americans won't do" must be suffixed with "at current wages". Today the WSJ runs a piece (subscription required) by George Borjas that is ambivalent on the economic value of immigration (in the eyes of the general public, although the typical WSJ reader is probably going to see wealth transfer from laborers to capital/business owners in a relatively positive light):
Immigrants cluster in a small number of cities. A third live in three metropolitan areas (New York, Los Angeles and Chicago). In the past, the stereotypical study exploited this clustering by correlating wages and immigration across cities. A negative correlation, indicating that wages are lower in cities penetrated by immigrants, would suggest that immigrants reduce the wage of competing workers. In fact, the estimated correlations bunched around zero, creating the impression that immigrants had little impact.

This inference is not correct for two reasons. First, immigrants are not randomly distributed across cities. If, as seems sensible, high-wage areas attract immigrants, there would be a spurious positive correlation between immigration and wages. This positive correlation could easily swamp any negative wage effect that immigrants might have had.

Natives also respond to immigration. Employers in Michigan, for example, see that Southern California cities flooded by low-skill immigrants pay lower wages to laborers. The employers will want to relocate to those cities to increase their profits. The flow of jobs to the immigrant-hit areas cushions the adverse effect of immigration on the Southern California wage, while slightly worsening conditions in Michigan. Similarly, laborers living in California, who now face stiffer competition, might leave the state to search for better opportunities. These flows of jobs and workers diffuse the impact of immigration across the national economy and tend to equalize economic conditions across localities.

From this, Borjas posits that immigration is better measured on the national level. That's sensible enough for wages, although there are lots of analyses to be done on the local level to show that immigration harms the well-being of the native working and underclasses (e.g. home ownership rates, affordability, school test scores, etc.

Sticking with the data at the national level and looking at how immigrant jobs effect natives with similar skill-levels, Borjas finds that from 1980 to 2000 immigration lowered the wages of high school drop-outs 5% over the long-term (its effects were more detrimental in the short-run). For other groups, immigrants had a marginal effect on wages (people who had completed high school but not college benefited slightly; natives with college degrees suffered slightly). He concludes that immigration has resulted in a wealth transfer from labor to capital owners, with a question mark on the total economic utility realized in the US.

It makes sense that low-end earners suffer more from immigration than high-end earners, at least on the service side of the economy. Globalization means that Microsoft, Pfizer, or KPMG seek out professionals wherever they reside. If KPMG needs to hire ten accountants to run numbers for managerial accounting consultation, it can pull them from anywhere in the world. If the five chosen who do not happen to be American natives are living in the US or in India at the time of hire is not going to significantly effect the compensation offered to the five natives who are picked. Having the five Indians in the US likely actually boosts the pay for natives because the Indians become more costly to hire than if they were in Bangalore.

Menial service jobs, however, are much more geographically contingent. Dishwashers, maids, and yard workers have to be in close proximity to the entity they are doing the work for. If the non-native laborers are in Mexico City, they can't cut lawns in Los Angeles. Angelinos desiring lawncare will have to look locally. Thus the wages of native yard workers will be directly effected by the location of non-native yard workers.

In other words, higher-end work can increasingly be done irrespective of the worker's physical location. American-born programmers (or researchers, writers, etc) compete with Indian-born programmers whether the Indians live in the US or in India. Low-end service work depends more on where the workers are. American-born yard workers (or burger flippers, janitors, construction workers, etc) only compete with Mexican-born yard workers if the Mexicans are in the US.

This is why I am less concerned by an increase in highly-skilled immigrants than by low-skilled immigrants. The US standard of living is a competitive advantage America can leverage to attract brains. Better to have a Japanese-born researcher (who brings few social problems like crime, disease, school deterioration, etc) become a US citizen to create wealth inside the country than have a multinational pay him in Japan. Or at least the first scenario is preferable to bringing in unskilled labor that is going to suddenly compete with unskilled natives and depress wages, consume services that natives pay for, and bring other pathologies. Whether or not the first scenario is preferable to no immigration at all is a tough one. But encouraging the second situation certainly makes no sense to me.


Sunday, April 16, 2006

The meek (minded) shall inherit the earth

The disovery of the connection between IQ and per capita income by country was ground-breaking. But there is another correlate of national IQ, and it's even stronger than per capita income: The correlation between IQ and number of births per woman. The correlation is, not surprisingly, inverse. Running the numbers yields an r of .81 (r-squared of .65--see chart below).

I haven't read Vanhanen's and Lynn's tome, but I understand that the r for IQ and PPP was found to be .73. Taking the same IQ scores and running them against the most recent PPP estimates yields an r of .60 (r-squared of .36)--moderated, perhaps due to the recession a few years back and the abrupt climb in oil prices that have bumped up the PPP in the moderately low IQ Middle East, but still significant. So IQ "explains" about one-third of national per capita income and two-thirds of fecundity. One notable difference in the correlations between IQ and PPP versus IQ and births is that East Asia doesn't conspicuously outly in the latter like it does in the former. Babes from Hong Kong average less than a single birth (.95 per woman)--and the place is also the IQ apex (107).

We are taking a deleterious dive. Liberalized economies open up opportunities for careers, travelling, education, birth control, economic independence for women, etc. Making babies has always been an option, but now more than ever there's more desirable alternatives for sharper people. Wealth is tied to IQ, but the correlation between PPP and fecundity is considerably weaker (r of .55, r-squared .30) than it is between IQ and fecundity. The driver appears to be IQ. Women in countries with abundant natural resources but moderate IQs (Middle East most saliently) do not have as much cerebration to keep them from having babies. Religiosity, independent of IQ, is probably correlated with having kids as well.

What to do to counter this trend?

-Higher IQ countries attract migrants from places less cognitively endowed. The correlation coefficient for net migration rate and IQ is a positive .40 (r-squared .16) if countries with a rate listed as zero are excluded (this is only a rough approximation. I cannot find much data on migration rates. Searching online I've only been able to find data parroting what's on the CIA's site, which lists lots of places as having no net migration/emigration even though they clearly do (like Zimbabwe for example)). Stopping the flow will lower the cost of living, bump up wages, and make public schooling more attractive.

-Invest in research to extend productivity as people age. Median age and IQ correlates positively at a very high .85. That is, 72% of the median age in a country can be explained by looking at that country's average IQ. Put in another way, every 1.17 point increase in IQ ups the median age by a year. The planet's up-and-comers have lower IQs. The older folks have the brains. Okay, that's pretty crass but generally true. At least when nation to nation comparisons are made. The Flynn effect is (hopefully) counterbalancing this to some degree, but it may be abating.

-Create incentives for people of moderate affluence to have more children. France has taken a few baby steps in this direction. The US tax code, unfortunately, punishes the fertile wealthy by phasing out exemptions and dependent credits and by the existence of the AMT.

-Spend aid money on birth control in the third world. A family member of mine worked in the diplomatic core of the State Department for several years. In Bangladesh he was involved in a program that distributed birth control devices. The program targeted the most impoverished areas. Critics lambast this sort of strategy as for being eugenic (that's inherently an evil thing for those of you who do not see why this counts as criticism!). But it helps realize a putative goal of the left: Closing the wealth gap.

-Watch Idiocracy. At least you'll be able to approach the future with tongue-in-cheek!

++Addition++John Bolton makes an excellent observation. Fecundity might be a better explanation for disparities in PPP than IQ is. IQ and births are decent proxies for one another. So which one is effecting PPP?

IQ is the primary causal factor. Its correlation with PPP withstands controlling for births per woman, but births per woman loses statistical significance as correlated with PPP when IQ is controlled for.

Here's how it breaks down: When IQ and PPP are correlated (without births controlled for), there is statistical significance factor of less than 0.001% with a correlation coefficient of .60. Each IQ point corresponds with a $653 boost in PPP.

When births and PPP are correlated (without IQ controlled for), the relationship is over 99.99% assured with a correlation coefficient of .55. Every baby costs $5,052 in PPP.

The slightly attenuated correlation coefficient for births versus IQ suggests the latter is the more powerful "determinate" of PPP. But we need to control for each of the variables. When births are controlled for, IQ remains statistically significant at about a 99.5% confidence level. Each IQ point now means a $485 boost in PPP.

When IQ is controlled for, births fall outside even an 80% confidence level (P-value of .78--meaning there's a 22% chance that the relationship is random. (The P-value is basically the same as the statistical significance factor, except the former relates to a multiple regression). In this less reliable relationship, each baby costs $1,752 in PPP.

So births per woman is a close proxy for IQ, and IQ is correlated with PPP. The corollary is, then, that births are correlated with PPP as well, although the correlation coefficient is not as strong as it is with IQ (.60 vs .55). When we control for births in the equation, IQ weakens a little but retains explanatory power (95% CI is the gold standard). However, when we control for IQ, births become only a third as powerful, and unreliable at that.

A rough reverse-syllogism: A couple comprised of two 130 IQers can afford to have a few children and still be considerably wealthier than a childless couple comprised of two 70 IQers. Having children does lower the economic power per family member, but IQ more than compensates for this cost. The dependents are net liabilities until they're no longer striplings. Lynn and Vanhanen should have (did?) considered this.

The most interesting (and tragic) aspect of the analysis is how few children the sharp nations are having (recall the correlation coefficient of .81). While IQ and PPP got the headline, the relationship between IQ and births is less tenuous--it appears to be rock-solid (I'm going to test it with some controls in near future).

Also, I humbly offer the data I'm working with to anyone who is interested (Email me if you are). It is in excel. More alacritous minds may find something my pile of mush is missing.

(Human biodiversity)

Saturday, April 15, 2006

Alternative minimum tax

With April 15, er, 17 upon us, the annual call for a simpler tax code is reverberating off the pages of many a media outlet. Adam Smith's four pillars of an effective tax code--equity, certainty, convenience, and economy (efficiency)--have crumbled. As if they ever existed, that is. The Revenue Act of 1913 that formed the basis of the IRC, which was codified officially for the first time in 1939, was several hundred pages long. The current tax code is a hodge-podge of amendments that have been added on sporadically over for ninety years (it now approximates infinity-billion pages). The old stuff isn't scrapped. Instead, new stuff is piled on.

As tedious as the code has become, with over half of all Americans now hiring preparers, the reviled AMT is as big a target for criticism. It too is generally described as being shrouded in mystery. But it's actually pretty simple.

The taxpayer (MFJ) gets an exemption on the first $58,000 ($40, 250 for single filers). After that, income is taxed at a 26%. At $175,000 it shifts to 28%. Most deductions and credits disappear--those for tax-exempt vehicles, exemptions (children, sick widows and orphans, senile mothers), real estate and state tax deductions, and child and dependent tax credits. Some notables that remain are charitable contributions, mortgage interest, and gambling losses (!). It's a quasi-flat tax.

The amount owed under AMT is compared with what is owed under regular tax computation and the greater amount must be paid. Because the thresholds are nominal, the AMT hits more people in places that are relatively expensive (nominally, not necessarily in real terms). This also means the tax disproportionately snares folks in blue states (the r-squared for per capita mean income by state and the percentage of the state voting for Kerry in '04 is a statistically significant .30). The AMT is often derided for this, although the regular tax code essentially works the same way.

I'm not an AMT apologist. Losing the exemptions particularly irks me because it, like progressive credits/deductions such as the child tax credit and the phasing out of personal exemptions, encourages poor people to have children (although if they're perspicacious enough to execute tax-planning strategies it might not be as bad as I fear!) and discourages wealthy ones from reproducing. This accentuates the wealth gap (think if Bill Gates had twenty kids to spread his $60 billion across while Joe Broke passed his meager savings on to his only son instead of splitting it up among ten urchins). It also lowers the nation's IQ.

But the AMT is not that complicated. If it's all we had, the tax code would be a lot less confusing.


Friday, April 14, 2006

Gene variation testing getting better, cheaper

We are approaching a new paradigm in the way human nature is understood (subscription required):

In Switzerland, a group of college students and local laborers sat down for a brief memory test a couple of years ago. They were given 30 words and then asked, five minutes later, to repeat them. On average, they recalled eight.

Last summer, American scientists equipped with a powerful new gene-testing technology gave this simple test an extra twist. DNA samples of the best and worst word-recallers were flown to Phoenix, where their DNA was checked with machines that can scour it for 500,000 genetic variations at lightning speed...

TGen got the DNA samples and used the new chips to scan all of the samples in less than a month. Dr. Stephan says the work turned up more than 100 gene variants that seemed to show up more frequently in people with good episodic memories. The researchers then repeated the experiments in two other groups, including 256 elderly people from the retirement community of Sun City, Ariz.

TGen researchers say they've narrowed their findings to what they believe to be five memory-related genes.

The opportunity to correlate different genetic variations with countless social, physiological, and psychological outcomes is going reveal the etiology of so much of the human diversity generally assumed to be caused by differences in environment.

The price of chips that detect over 300,000 genetic markers is falling rapidly:

While the technology is still expensive, in the past nine months the price of some chips has fallen rapidly to around $750 each, from $1,200, according to Dr. Stephan.
That's roughly in line with Moore's Law. As the chips become less cost prohibitive, sociologists and other researchers will be able to start exploring the relationship between genes and virtually every human trait or behavior imanginable. Amateur enthusiasts will also be able to get into the game.

The memory test on Swiss kids is a short step away from being an IQ test. Predictably there is unease:
If the studies of gene variants do prove as powerful as adherents believe, they are likely to raise thorny societal issues. That's because the same tools that can find variants that raise disease risk might identify genes that influence any measurable human trait, including height, weight or even intelligence.

Why be afraid of the truth? Celebrate diversity. Isn't that the mantra? Many putative diversity boosters want to break the perceived monopoly of the WASP burgher's value system, but they dogmatically maintain that the human mind is a tabula rasa. They do not want to discover the real causes of diversity, nor do they want to entertain diversity of thought.

Putting the controversy aside, the benefits of cheap and quick gene testing will be enormous. If your child has a gene variation that puts him at high risk for obesity, you will be able to form good eating habits early, like starting him on skim milk instead of whole milk. The military will be able to determine branch assignments based on risk tolerance. Those with the genes to thrive in high pressure situations can be put into infantry or artillery while the fainter of heart are assigned to support branches. Research will help the medical community better understand a host of diseases and how to combat them. Parents will be able to guide their kids into athletics or music or chess club based on inherent strengths. The list goes on forever.

Society as a whole will lose a lot of deadweight loss as people align their lives in ways that utilize personal strengths, compensate for weaknesses, and fulfill desires.


Wednesday, April 12, 2006

Industries of the future: Housekeeping, landscaping, and meat packing

Our economic dynamism is hardly being fueled by this:

Of the hotel industry's 1.5 million employees, 150,000 aren't supposed to be here, according to statistics gathered by the Pew Hispanic Center. In food manufacturing, also with 1.5 million, 210,000 have no right to work. Landscaping, Mr. Penry's line, has 1.2 million workers, 300,000 of them illegally in the country.
Virtually every third-world country has these industries. They do not add to America's global competitiveness. The less endowed natives our elites are spitting on can do all of these jobs. We have youths to do them as well. Agriculture is already subsidized directly to the tune of over $12 billion a year before even taking the indirect subsidy for low-skilled immigrants into account.

Tancredo's Caucus should more vociferously support employer sanctions and the enforcement thereof. HR 4437 is not particularly strong in this area. Businesses can claim good faith and gain exculpation from the actions of their subcontractors. Subcontracting work is by nature more transitory and harder to track. Subcontractors contract out further making the "good faith" argument easier to construct. Plus, 40% of illegals overstay visas. An impervious barrier alone won't stop this. Of course, without teeth the laws are meaningless:

Inspectors now need written permission from supervisors before entering a work site. Employers get credit for "good faith attempts" to live up to the law. Since 1996, when the focus of enforcement began to move away from work sites to the borders, the number of fines collected have dropped to nearly zero from a high of about 8,000.
A message of tougher enforcement will bolster support among blue collar folks. Pew's Political Typology report found that opposition to guest workers is strongest among "Disadvantaged Democrats" and "Conservative Democrats"--stronger than it is among any of the Republican/conservative categories. Working class natives do not want employers to use slave labor at the expense of their standard of living. Republican pols need to ditch the futile attempt at pandering to a Hispanic demographic that is never going to vote for them. It will cost them white votes. If a 10% gain in the Hispanic vote costs Republicans 1% in the white vote, it is a wash.

A new report reinforces the obvious:

The Federation for American Immigration Reform (FAIR) estimates that state and local costs associated with illegal immigration for public education, health care and incarceration, now about $36 billion a year, would balloon to $61.5 billion by 2010 -- a 70 percent increase -- and increase to $106.3 billion by 2020. As a result of an amnesty and a vastly expanded guest worker program, millions of current illegal aliens would gain legal access to government
programs and services, a FAIR analysis states.

Moreover, newly legalized aliens would be allowed to bring their dependents to this country, adding to the burdens on schools and public health care.
President Bush pines to have illegal aliens "emerge from the shadows". Allowing them second-class citizenship is bad. But allowing them full citizen would be positively disastrous. They would become eligible for exemptions and the EITC. In families with lots of dependents (and the average Hispanic household is 135% the size of the average white household) this will often result in a direct transfer from the government to the non-taxpayer in the form of a refund larger than the total taxes paid during the year.

Costs more difficult to quantify will have an even worse long-term impact. School test scores will continue to plummet, the wealth gap will grow, housing will become less affordable, crime and pollution will increase, ad infinitum. The negative effects will augment as the newly-minted citizens send for relatives back home. The demographics will make immigration reform impossible.

FAIR estimates California really takes it on the chin, with the cost created by illegals representing over $1,000 per citizen:

California $8.8 billion ($1,183 per native household)
Arizona $1.03 billion ($717 per native household)
Texas $3.73 billion ($725 per native household)
Florida $.91 billion ($315 per native household)
Taking Randall Parker's high-end estimates and inflating them to $10 billion, a wall could be constructed for less than $100 a household.

From the Reagan amnesty to today, the illegal population quadrupled. So does that mean when I hit forty the President and Senate will be looking for a way to bring another 50 million into the sunlight? Probably not, because by that time a senescent population of dullards will make the US a much less desirable location.

We need a wall, a merit immigration system, and publicized punitive actions taken against businesses that pass the cost of their low value-adding labor on to the net taxpayer.

++Addition++How surprising:
The shelter’s manager, Francisco Loureiro, said he has not seen such a rush of migrants since 1986, when the United States allowed 2.6 million illegal residents to get American citizenship...

Migrants are hurrying to cross over in time to qualify for a possible guest-worker program--and before the journey gets even harder.
Apprehensions are up:
South-central Arizona is the busiest migrant-smuggling area, and detentions by the U.S. Border Patrol there are up more than 26 percent this fiscal year — 105,803 since Oct. 1, compared with 78,024 for the same period a year ago. Along the entire border, arrests are up 9 percent.
The sympathetic AP reads into this that enforcement is becoming fierce. It laments that immigrants must face "armed US citizens". But more plausibly--and what the bulk of the referenced article suggests--it is the number of crossings that have increased. The numbers of rescues and deaths during attempted crossings lead one to that conclusion.

The definition of insanity is to repeat the same action over and over and then expect a different result each time. Either the majority of the Senate and the White House want the US to descend into the ranks of the third world or they are all insane. I prefer the latter but fear the former is more accurate.


Tuesday, April 11, 2006

The Crucible in Durham

Forget Arthur Miller's Crucible book controversy--we have the real thing:

Results of DNA tests released Monday do not link members of Duke University's lacrosse team to an exotic dancer who reported she was sexually assaulted by three players at an alcohol-fueled party last month.
Supposedly she was gang-raped, choked, and sodomized. Yet no semen, saliva, or even hair remained on the courtesan. The accuser's story has been inconsistent, her past checkered:

Meanwhile, a second dancer's statements cast further doubts on the woman's claims...

In 2002, she was working at a topless club in Durham, when she stole a cab driver's car keys while giving him a lap dance, according to a police report. When the driver went to the bathroom, she drove off in the cab and led police on a lengthy car chase. In the process, she smashed into a patrol car and attempted to drive through a fence, but was eventually arrested after her car got a flat tire. She tested at 0.19, more than twice the alcohol limit.

My prediction: Our Betty got inebriated and played catatonic out of fear of consequences that might arise. The DA, who is up for reelection against two more qualified candidates. That is, Nafing, who is a white man, is running against a harpy of a woman and a black man. Durham is 44% black. The opportunity to burn a gang of white yuppies at the stake on behalf of a black single-mother was a godsend. Tom Wolfe wins again.

The fatal flaw was that it all happened too quickly. The severity of the charge would have been sufficient for the Nafing to get reelected in May. But the credulous media made the story page one in its indefatigable search to prove white male oppression.

Unlike Miller's tale, this one is true.


Saturday, April 08, 2006

Immigration and the Ownership Society

It's been awhile since President Bush has touted his push for an Ownership Society. Given the intensity of the current immigration debate, it's prudent of him to keep his mouth shut. Why? Because the larger the foreign-born population, the lower the home ownership rate becomes.

Running a regression on the
home ownership rate and foreign-born proportion of the population by state yields a significant factor of zero (it's definitely not random) and an r-squared of just over .42 (42% of the home ownership rate of a state can be explained by number of the foreign-born in that state). For each 1% increase in the foreign-born population as a portion of the state's entire population, the home ownership rate correspondingly decreases .65%.

Like so many other potential consequences of the unprecedented immigration influx, it's something people should know about, and--in light of Steve Sailer's
Dirt Gap--something Republican pols should think about.

++Addition++From basic economic theory (and obviously there are lots of other factors like geography in play) I would expect the newly-arrived to locate in areas where housing is more affordable, but they are doing the exact opposite. In fact, the percentage of foreign born and housing affordability have an inverse r-squared (zero sign factor) value of .58. Wow. What role are migrants playing here? Are they attracted to places they cannot afford (because there are many affluents in need of services), are they making places less affordable, a combination of the two, or something else?

Whatever the best explanation for the complex underlying causes, the new arrivals are keeping house prices high. As natives leave (Cali or NY for example), residential prices should fall as demand eases. But migrants, who prefer the service jobs created by the high-income natives that can still afford higher-priced markets, do not go to areas where they would make less nominally (and probably in real terms as well given the industries in which they work) even though housing is generally more affordable in these places. Being able to guaratnee five bucks an hour, fill the belly, and send money back home is a desirable situation for the migrants but not for natives. Thus, the newly-arrives compensate for the price relaxation of native exodus (and then some). Meanwhile, wages are suppressed, making home ownership even less tenable for those remaining.

States with high foreign-born populations are beginning to look like manors. I'm going to look at metropolitan areas with high foreign-born populations to try and focus the effect. It seems reasonable that the inverse correlation between foreign-born and affordability will be even higher. Peasants come because the keeps have plenty of menial chores to be done. The peasants have work, but they can't afford to buy part of the manor. This situation is bad for the burghers, who leave because earning power is being pushed down while costs are going up. It's bad news for natives (future voters) that don't already own a home.

++Addition2++State-by-state comparisons dilute the inverse correlation between affordability and immigration a little. Looking at cities with over 500,000 people, the r-squared increases to .63 with a significance factor of zero.

Our self-immolating immigration policy is certainly making the ownership society a pipedream. I would hate to be a kid in his early twenties a few months away from graduation! Generation Y has it rough--a tidal wave of entitlement obligations for retiring baby boomers, a stagnation in wages, and growing unaffordability of housing.


Friday, April 07, 2006

WSJ gives some ground

The WSJ admits (finally) that unskilled immigration lowers the wages of our unskilled natives:
Yes, immigrants compete for these entry-level jobs most directly with Americans who lack a high-school diploma...
Hopefully the "Jobs Americans won't do" bromide is now moribund. The WSJ employs the usual smearing of immigration realists (calling them "leftist economists"!) and proclaiming a sealing of the border to be impossible, even though the same op/ed board cheers the success of the Israeli security fence. But there's a better way:
Our answer is that a closed economy ultimately would make America a less competitive and hence poorer country...
Control of the border and the institution of a merit immigration system and/or a reduction in the total number of immigrants permitted entry is not at all synonymous with a closed economy. What happened to the rudimentary economic idea of core competencies (including human capital)? What a strawman. Continues the WSJ:
We'd have less human capital, and because we'd be using the human resources we did have less efficiently.

No, we'd be using it much more efficiently. Having migrant fruitpickers depressing wages (and by extension, technological innovation), filling almost a third of our federal jail cells, and sending $17 billion a year back to Mexico each year is an incredibly inefficient use of human capital. Having the brightest provide services and otherwise take care of this growing underclass creates deadweight loss.

After downplaying the impact of immigration on wages at the bottom, the WSJ states:
Immigrants also increase the demand for labor, not just the supply. That is, they are also consumers who create jobs by buying goods and housing here.

Criminals increase the demand for prison guards. Cigarettes increase the demand for lung surgeons. If we annex Mexico tomorrow, US GDP and jobs will enjoy double-digit increases, but the more important measures of PPP and worker productivity will drop by 20%.

The real estate price explosion is
fueling an economy built on unjustified home equity loans. People are spending more than they make. If you're among the 100 million Americans who don't own a home, affording one is the toughest it's been in 15 years. Unskilled immigrants need places to live. So they push up the cost of housing. This is a boon for homeowners, but for natives who don't own a home--disproportionately those same people whose wages are being depressed--the chance at the American dream we use to defend irrational immigration policies is getting ever smaller.

After suggesting that open borders make the US more competitive globally,
we learn what the industries are:
The domestic carpet industry based in Georgia has managed to survive and thrive due to immigrant labor. The same holds true for meat-packing plants in the Midwest...

The agriculture industry certainly would attract more Americans if it paid $50,000 a year to pick lettuce in the noonday sun, but not without raising the cost of food and other things. It would be more expensive to eat out, for example, and fewer people would do so as a result, affecting the restaurant industry, among others.

Carpet-makers, meat packers, fruitpickers, and dishwashers. Taiwan, Bangalore, and Hong Kong better watch out!


Thursday, April 06, 2006

Reid hard to read?

I hope the House stays tough:

Senate Majority Leader Bill Frist, a Tennessee Republican, appeared with Reid and said "We have a great opportunity to deliver to the American people what they expect, what they deserve," a comprehensive border security and immigration reform bill.

The deal, which would include a temporary worker program backed by President George W. Bush, would allow illegal immigrants who have been in the United States more than five years a chance to become citizens if they meet a series of requirements and paid a fine. Other rules would apply to people in the country less than five years.
Harry Reid certainly is familiar with compromising--his beliefs, that is. In 1993 he sponsored a resolution that never made it out of the Senate Subcommittee on Immigration. It almost puts Tom Tancredo to shame:

S.1351 Title: A bill to curb criminal activity by aliens, to defend against acts of international terrorism, to protect American workers from unfair labor competition, and to relieve pressure on public services by strengthening border security and stabilizing immigration into the United States.
It details deportation procedures, withholds all benefits to those failing to show up to asylum hearings, increases penalties for VISA fraud, and brings back the venerable public charge designation:

(4) PUBLIC CHARGE- Any alien who cannot demonstrate to the consular officer at the time of application for a visa, or to the Attorney General at the time of application for admission or adjustment of status, that, taking into account the alien's age and medical condition, he or she has assets, education, skills, or a combination thereof that make it very unlikely that he or she will become eligible for means-tested public assistance of any kind (including, but not limited to, medical care or food and housing assistance) or will otherwise become a public charge is excludable.'
It also caps total immigration at 300,000 minus the number of refugees given asylum and puts the maximum number of work-related Visa grants at 40,000.

Fast-forward to 2006, carcass of S1351 a distant memory:

Reid said the overhaul must include heightened border enforcement, a "guest worker" program and a "path to citizenship" for the estimated 11 million people in the United States illegally. He called legislation by Sens. Edward Kennedy, D-Mass., and John McCain, R- Ariz., a "good place to start."
Reid used to be an ardent supporter of immigration reform. He was elected into the House as a representative from Las Vegas in 1982 and became a Senator in 1986. As the turf changed, so did old Harry:

Nevada is one of three states that had a foreign-born population increase of more than 200 percent during the 1990s. Nevada's foreign-born population increased 202 percent...

101,000 illegal aliens resided in Nevada as of 2000, according to INS figures. This is 321 percent higher than the previous INS estimate in 1996 and 461 percent higher than the estimate for 1992.

I guess Ed Gillespie is right. If Republicans will just accept massive amounts of impoverished Hispanic immigrants and all the problems this embraces, they too will retain power for twenty years. The only catch is that they will all have to become Harry Reid simulacrums, and they'll have to be able to out-pander the real Senator.

Demographic shifts close our window of opportunity a little more each day. The issue has to be our electoral priority. Indeed, it should be the sole arbiter. We cannot afford to let anything else take precedence. Vote against your House member if he didn't vote for HR4437. Give your Senator the boot if he signs on to the guest worker atrocity. Let Sam Brownback know you will be casting a ballot against him in the primaries and in the '08 Presidential election if you're a Democrat. Cross party lines. We have competent, cogent leaders at places like VDare. The public is on our side. We just have to have it transfer to the polls. That means putting capital gains, abortion, and even Iraq on the backburner. It's now or never.

++Addition++Rather than having to rely on the House staying tough, we got the Senate locked in intercine bickering:

Agreement over a highly touted Senate compromise on illegal immigration fell apart Friday as lawmakers lashed out at each over who was to blame for the present impasse over the bill...

The compromise reached Thursday sought to divvy the estimated 11 million or so illegal immigrants into three groups: those who have been inside the country for more than five years; those who have been in the country for between two and five years; and those who have been in the country for fewer than two years.

How is the time spent in country going to be tracked? This sounds fallacious on its face. The government knows little about these people now--how we would go about verifying how long they've been in the US is obviously problematic. Steve Sailer is right--the best thing that can happen for immigration sanity is no bill now so that it can be primary issue in '06.


Gini's a better measure

The median/mean ratio is problematic for correlating race with income disparity, as it gives more weight to the right side of the income distribution than the left (If Bill Gates' income doubles, the median will stay put but the mean rachet up quite a bit. If Joe pool attendant's income is cut in half, the median will again remain the same, but the mean will only drop slightly). The poverty rate is not an optimal variable either, because it involves only a fraction of the income distribution, has contingencies like family size, varies based on age, and doesn't take into account cost-of-living (poverty rates tend higher in places with a lower cost of living because nominal wages are lower, but this doesn't tell us little about wealth disparities).

Robert at the eponymous
Robert's Rationale suggested use of the Gini coefficient. It scales between 0 and 1, with 0 being perfect income equality and 1 representing a single person with all the income. This eliminates the problem of affluent pull and captures the entire income distribution.

This slightly moderates the strength of the correlations with the significance factor remaining zero. The r-squared for a higher Gini (more income inequality) and the black/Hispanic grouping is .56. For median/mean, it was .58. For non-Hispanic whites/Asians the correlation of lower Gini (more income equality) falls to .43 from .44. While the change is trivial, using Gini provides greater accuracy.

So how should open-border types react? Progressively, of course. They should not look to ten years in the future like those short-sighted conservatives. Instead, they can take the longview--if we accelerate the underclass immigration rate and
white birthrates remain below replenishment, in a century the income gap will begin to narrow as the new arrivals are ever-closer to the national average (because it's been falling for the last ninety years)!


Wednesday, April 05, 2006

39,000 Chinese a drop in the bucket

We're told by politicians that it's impossible to start rounding up Hispanic illegals and deporting them a couple of hundred miles south. But apparently it's no sweat to round up 39,000 Chinese illegals and ship them halfway around the world:
The United States and China are close to an agreement on repatriating illegal Chinese migrants, the U.S. security chief said on Tuesday at the end of a visit that also focused on aviation and ports security.
Chertoff says he wants to send a message:
"If we catch them and release them ... we suggest to people that if they can get across the border they are home free and safe from being returned. We want to send a very different message," Chertoff told reporters...

About 39,000 Chinese were illegally in the United States, many of them brought there by people-smugglers, Chertoff said.

The Chinese in the US are less likely to voluntarily leave because of distance when they begin being deported. Hispanics would have less trouble hightailing it if they knew their time in the US was limited. So if we can do it with Chinese illegals, we certainly can with Hispanics. Yes, 39,000 is not 12 million but it is not an insignificant number either. Even if we moved to repatriate (and imprison those with records) a couple hundred thousand a year the desirability for new-arrivals would decrease and others already here would start to leave on their own.

agreement has been reached after protestations from the Chinese government, which previously resisted taking them back. The US did some arm-twisiting to get it done.

These Chinese runaways are probably better for the US than most Hispanics. They are coming on a trip that requires greater means from a
cognitively endowed country that is still not favorable to entrepreneurial types unless they have political connections. They're akin to the early waves of Cuban immigrants. Chinese Americans--47% of whom are first generation--have median household incomes 30% higher than the national average, a home ownership rate of 65% compared to a national average of 54%, and 38% have a bachelor's degree compared to a just under a quarter of the nation as a whole.

So we can deport illegals even in the face of political opposition by their host countries when the illegals are less detrimental to American well-being, but when they are positively disastrous for the US by virtually every measure possible, we must fatalistically accept what we are powerless to do anything about and instead work on making our new liabilities feel welcome.


Monday, April 03, 2006

Diversity and economic disparity

Diversity brings economic disparity. Economic disparity is not good for democracy. The corollary is that diversity is not good for democracy. The optimal situation is one in which wealth disparities are naturally small without having to resort to robin hood wealth transfers.

Yet economic disparity is absolutely correlated with race. Running a regression and correlation analysis on data from the fifty states plus DC, I looked at each state's population of the four major ethnic/racial groups (non-Hispanic white, black, Hispanic, and Asian) and correlated it with the variable "
Median income as a percentage of Mean income" which was computed by dividing each state's median income by its mean income. The larger the difference between the two, the greater the economic disparity in the state (think of how much Bill Gates moves the mean while doing no more for the median than Joe accountant in the state of Washington who makes $60,000 a year).

I found that significance factor was virtually zero for whites, blacks, and Asians (in other words, there is a 99.9999999% chance that the correlation between wealth disparity and race is not random). For Hispanics, the significance factor .067, meaning that there is a 6.7% chance that the relationship was due simply to chance. That is due to the
substantial differences in the American Hispanic community (Cuban doctors in Florida vs Amerind fruit pickers in California).

The r-squared value for blacks is the highest, at .494. But the greatest correlations exist when non-Hispanic whites and Asians are combined into one group and blacks and Hispanics into another. The significance factor for both drops to virtually zero, throwing chance out the window. The r-squared value for whites/Asians is .44. For blacks/Hispanics it is .58. This means that 58% of the magnitude of wealth disparity can be explained by the percentage of blacks and Hispanics in a state. That's enormous, and though raw, it's a powerful argument against facile comparisons of this wave of immigration to the previous three that were from Europe. It was 44% for whites and Asians (the reason this correlation is more moderate is because whites represent 70% of the country and consequently are the most economically diverse subgroup). Other groupings showed no statistical significance.

As the country becomes progressively more Hispanic and black, wealth disparities are going to continue to grow. As the white/Asian group dwindles in relative size, numerical superiority is going to shift towards the poor end as the middle class dwindles. We are moving from a middle class to society to one of economic extremes. This is fertile ground for leftist populism and quasi-dictatorship. Check out the
average net worth of millionaires by continent. The fattest are in Latin America followed by Africa. Do we want to become more like Latin America or Africa?

Think it's hyperbole? As Steve Sailer has chronicled,
it's moving north. Far-left candidate Andres Obrador has a real shot at the Mexican Presidency in July. He will be even more harmful to the US than Vicente Fox has been, if that's possible (he has criticized Fox for not coming down hard enough against HR4437). Some putative conservatives want to throw caution to the wind and out-pander the left. Former RNC cacique Ed Gillespie admonished Republicans in the WSJ:
The Republican Party cannot become an anti-immigration party. Our majority already rests too heavily on white voters, given that current demographic voting percentages will not allow us to hold our majority in the future...

Hispanic voting percentages are increasingly decisive in swing states like New Mexico, Nevada, Florida, Colorado and Arkansas. Mishandling the immigration debate today could result in the Republican Party struggling in these states and others in the same way it does now in California.

Are you kidding me? All the states mentioned used to be Republican strongholds. The deluge from south of the border has turned the red purple, and more immigration is going to give it a blue hue. Prop 187's attempt to lessen the incentives for an illegal Hispanic underclass did not doom the Republican Party in California. It's failure to be implemented and built on doomed the GOP. Gillespie needs to be working to halt the influx from the south. The popular support is there.

It is self-immolation for the Republicans to turn their backs on white Americans and the middle class in general, as much as Gillespie laments the fact that the Republican Party has to rely on them. When I first learned about politics, I was attracted to the Republican Party because of their supposed core values: Small government, respect for tradition, rationality over emotion, critical thought over political correctness, individual responsibility over group obligation. In the Gillespie's Republican Party, I see none of these things. Democratic leaders, worthless as they are on the immigration issue, must be given credit for being wise enough not to moan about how they rely too heavily on blacks as they pursue of more Hispanic voters (when
it is clear that blacks, like whites, want stricter immigration control).