The southern border wall that Donald Trump had promised to erect was never completed. With his idea to place refugees on barges or transfer them to Rwanda, Rishi Sunak might not have had much more success halting the small boats, Entrepreneurng report.
Nonetheless, the lengths to which governments would go to “protect” their borders highlight how contentious the political issue of immigration has become in affluent western nations. Additionally, it is not only true in the US and UK. In recent years, as the number of migrants has increased, anti-immigration groups have begun to appear in Sweden and Germany.
In the UK, net migration—the sum of new arrivals minus outgoing departures—has been increasing over the previous three decades. Statistics from the House of Commons library show that from 1998 to 2020, immigration outnumbered emigration by more than 100,000 each year. Net migration increased by a record amount of slightly over 500,000 in the year leading up to last June, helped by one-time factors like the conflict in Ukraine.
This 30-year pattern represented a departure from the past. More people left Britain than came in the 1960s and 1970s, and net migration didn’t start to climb significantly until the early 1990s. This makes sense, possibly. In the 1980s and early 1990s, there was widespread unemployment, although not in the UK.
Yet, the UK economy expanded continuously from 1992 to 2008, and there was much employment available, both in the high-paying post-big bang City of London and in the low-paying fields of hospitality and social care.
This was also the time when globalization took off, with newly opened low-cost nations like China supplying cheap commodities that increased consumer spending power in western economies. The developed world’s wealth was not lost on those in developing nations, which eventually prompted more individuals to look for a higher quality of living in Europe or North America. Higher net migration to the West was, in a manner, the opposite of capital outflows to the developing world. People, the money only went one way.
Not everyone who comes to the UK for work does so. In fact, only around a third give that reason, with a slightly higher percentage saying they are coming to study and the majority saying they are seeking refuge.
Nonetheless, net migration has boosted the size of the labor force and filled openings that would not have been filled otherwise.
Net migration has increased as a result of the new post-Brexit arrangements, which eliminated free movement for EU citizens and instituted a points-based system for work visas.
This brings up two queries in Britain and internationally. The question is whether net migration volume matters. From the standpoint of the free market, it does not, as labor, like capital, should be permitted to go to the regions of the world where It can be used most effectively in this way. Populations in the west are aging due to demographic change, and the labor shortage is increasing inflationary pressure. Why then not let migrant labor fill in the gaps?
In actuality, no major political party supports this strategy, not the least because unfettered immigration stresses the social infrastructure of industrialized nations, particularly housing. Additionally, it deprives emerging nations of their most talented labor.
Open borders imply that the planning laws would need to be liberalized to build millions of new dwellings to accommodate a growing population, at least in a tiny country like Britain. Otherwise, the demand for real estate would vastly outpace the supply, resulting in a rapid increase in housing costs.
The dominant economic paradigm – low Wages and high rents for the underclass combined with rising home prices for the wealthy would become further entrenched.
Yet, there is a second issue: how should western countries attempt to control migration? The standard response is to improve education and training so that domestic employees may eventually perform the tasks currently performed by migrants, together with rigidly enforced quotas for industries most affected by a lack of labor.
This strategy holds promise as a whole. It does, however, ignore the fact that the overlapping crises of recent years have almost definitely reinforced the desire to move to the west. Climate change, which disproportionately affects low-income nations, will inevitably intensify this strain.
In low-income nations, whose per capita income growth was lagging farther behind the rates required to catch up with advanced economies, the president of the International Monetary Fund, Kristalina Georgieva, announced last week that her organization had revised down growth predictions for those nations.
According to her, “this poses a threat to reverse a decades-long trend of steadily convergent living standards.” The World Bank president, David Malpass, was equally pessimistic, stating that 700 million people, or about 10% of the world’s population,
Both the IMF and the World Bank are pleading with affluent nations to do more to support developing nations in their efforts to build economic resilience, but these pleas are typically ignored. Finding a solution to the impending debt issue is not being approached with enough haste, or providing the funds required to address the effects of global warming or the impending debt catastrophe.
Conclusion
Sunak talks harshly about immigration but doesn’t do much to take away the reasons why people would want to come here in the first place.
It would be absurd to expect immediate outcomes from a less frugal strategy, but in the wake of aid cuts, the government is already spending five times as much on refugees in the UK as it is on help to Africa.
Because any short-term benefits to the Treasury will be outweighed by the longer-term expenses, this is a textbook example of a false economy.
Credit: Keith Elliott
