Wall Street Journal (Opinion)
By L. Gordon Crovitz
April 14, 2013
Just as Washington is considering the first immigration reform in a generation, a reminder of the urgency of the issue comes from a surprising source: China. Even with more than 1.3 billion people, Beijing realizes it needs more people. Welcome to an era when governments of all kinds treat people as assets, not liabilities.
Last month, China's new leaders signaled that one of their earliest priorities is reform of the one-child policy, which has ruthlessly enforced limits on family size since the 1970s. This follows a government announcement last year that the labor force—the working population between 15 and 59—shrank for the first time in 50 years. Beijing fears an aging population—an imbalance of few young workers supporting a growing number of old people—that could resemble those of Japan and Europe.
The one-child policy is deeply ingrained in China. It began in the Mao era as part of the effort to break down the family unit and strengthen government control. Enforcement remains brutal, with many forced abortions and deaths among women. But even state-run media now cover gruesome cases of late-stage abortions. A preference for sons has created an unprecedented imbalance of the sexes. There are entire villages of men without wives.
(My wife and I observed the impact of the policy during a recent trip to China. When we visited cities like Shanghai and Chengdu, crowds of Chinese lined up for photos with our three young sons. "In China," they said, "we can only have one.")
Beijing's reconsideration of the one-child policy is motivated by economics, not human rights. For a country like China that doesn't have a lot of immigration, the best way to boost the working population is to encourage families to have more children. The one-child policy has already been dropped for couples who themselves were only children, as well as in some rural areas and for ethnic minorities.
The U.S. also faces the problem of an aging population, but it has the advantage that people from around the world still want to come here. Former Congressional Budget Office Director Douglas Holtz-Eakin issued a report last week on the economics of immigration for the conservative think tank American Action Forum making many of the same points as reformers in China.
The Pew Research Center reports that the U.S. birthrate has fallen to its lowest level since records were first kept in the 1920s. The average American women gives birth to 1.93 children in her lifetime, below the 2.1 rate needed to maintain population size.
Mr. Holtz-Eakin estimates that even modest reform to immigration laws would mean a difference in population growth, boosting it by 0.2% a year. Mr. Holtz-Eakin used "dynamic" analysis to add in the effect of the higher rate of labor-force participation among immigrants compared with the native-born and their higher rate of entrepreneurship. As a result, he estimates the annual rate of economic growth would rise to 3.9% versus 3% over 10 years. Per capita income would rise by $1,700, and the cumulative federal deficit would decline by $2.7 trillion.
Economists can argue about whether Mr. Holtz-Eakin's numbers are too optimistic, but it is progress that Washington is focusing on the economic opportunity from smarter immigration policy. "The degree to which immigration policy is economic policy has been traditionally underappreciated in the U.S.," Mr. Holtz-Eakin writes.
Current immigration policy bears no relation to economic opportunity. Within a week of the April 1 filing date for the H-1B visas for high-skilled workers, there were 124,000 applications for the 65,000 available visas. For a time in the early 2000s, Congress approved more than 100,000 additional visas each year in this category. But since then Democrats have blocked proposals to add more such visas.
The U.S. still sends home graduates with advanced degrees in science and engineering instead of stapling a visa to their diplomas. The result is fewer foreign students. The number of Chinese citizens planning to study for advanced degrees at U.S. universities next year—about one-third of the total number of international students—fell by 5%. Students instead are studying in countries such as Australia and Canada that have more open immigration policies for skilled workers.
Facebook FB -2.26% founder Mark Zuckerberg recently announced a new bipartisan Silicon Valley group, FWD.us, to focus on immigration reform. "In a knowledge economy," he said, "the most important resources are the talented people we educate and attract to our country."
America was built by immigrants, and it needs them as much as ever. All Washington has to do is to open the borders enough to immigrants who will help restore economic growth.
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