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Kaus, Obama, income inequality and immigration

I think I've mentioned before that 2011 will be my year of reading about income inequality and the welfare state. I've already got a running head start with the Christmastime purchase of Paul Krugman's "The Conscience of a Liberal." My plan is to read a serious of books along the political spectrum -- William Voegeli's "Never Enough: America's Limitless Welfare State" is next on the list.

But the national discussion is currently outracing my attempts to build a foundation for my own contributions to the debate. Today, Mickey Kaus weighs in with his own suggestion about what President Obama can really do if he wants to address income inequality: Put a clamp on illegal immigration:
 A major enemy of tight labor markets at the bottom is also fairly clear: unchecked immigration by undocumented low-skilled workers. It's hard for a day laborer to command $18 an hour in the market if there are illegals hanging out on the corner willing to work for $7. Even experts who claim illlegal immigration is good for Americans overall admit that it's not good for Americans at the bottom. In other words, it's not good for income equality.
I suspect that there's something to this, but not in the way that Kaus thinks. Part of the reason that illegal immigrant labor is so cheap -- and thus contributes so mightily to income inequality -- is that employers hold pretty much all the power in the employer-employee relationship. They're generally content to overlook a worker's immigrant status as long as they provide cheap labor. But if those workers started agitating for higher pay or tried to unionize (options available to their naturalized colleagues), well, it's not too difficult to imagine a manager making a call to the authorities to get rid of the rabble-rouser, is it? So illegal workers keep their heads low and their hands busy, because the pay is still far better than what they'd make back at home. Otherwise, why would they be here?

Cracking down on illegal immigration might solve the supply-demand problem that affects income inequality, I suppose, but it seems to me also possible that a smart, always-talked-about-but-never-implemented guest worker program might do quite a bit to affect the dynamic as well. If illegal workers knew that they could fairly bargain their labor for pay without worrying about deportation or prison, the result might be higher pay. That would bring up the incomes of the lowest-earning workers, yes, but it might also give illegal workers less of a workplace advantage over similarly skilled American citizens who might require a bit more money to do the work. You don't have to build a high fence to address income inequality, in other words: Just make the immigration system make more sense.

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