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The Trump Effect — Immigrant Displacement Of American Workers Hits The Wall

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Forty-plus years in financial journalism taught me that people aren’t really interested in economic data. They say they are, but (unless the sky is falling, as in 2008) what really grabs them is war, race, sex, drugs, and rock-n-roll. Nevertheless, data does sometimes matter and now may be one of these times—it looks like immigration, and immigrant displacement of American workers, has finally hit the wall.

The evidence appeared in the monthly Bureau of Labor Statistics Household Survey, which was released last Friday. Most commentators grumped about the relatively low job growth rate. But I always look at the analyses prepared by economic consultant Edwin S. Rubenstein of ESR Research, previously of the Hudson Institute and National Review.

This month, Rubenstein points out that annualized growth in the foreign-born workforce has collapsed. It was only 56,000 over the 12 months through March, down from 1,711, 000 for the 12 months ended October 2016—significantly, directly before the Presidential election.

Which is particularly interesting because annual legal immigration (the Household Survey doesn’t distinguish between legal and illegal immigrants) has been running at about a million a year. So this new foreign-born workforce total implies a really dramatic and accelerating exodus, which has been overwhelming any continuing inflow since Trump was elected.

Conversely, Rubenstein noted at the time that, beginning in the last year of Obama’s Presidency, the Household Survey showed immigrant workforce growth far in excess of the legal inflow. Obviously, an illegal alien stampede was underway, probably triggered by Democrat promises of Amnesty.

March’s year-over-year foreign workforce growth is the lowest since March, 2009, the nadir of the Great Recession. Rubenstein thinks the current trend is so powerful that, in the upcoming months, the immigrant presence in the workforce might even begin to shrink.

This effect—heck, let’s call it the “Trump Effect”—is also visible with immigrant displacement of U.S.-born workers.

This is a bitterly controversial subject. Immigration enthusiasts always hotly deny that displacement exists— “immigrants don’t just take jobs, they also make jobs.” Maybe so, but unfortunately the people whose jobs immigrants take (e.g. poultry workers in the Mid-West) don’t necessarily get the jobs they create (e.g. teaching illegal aliens children, nursing them in Emergency Rooms).

Nevertheless, it’s always been literally true that, if an immigrant has a job, a native-born American doesn’t have that job.

Rubenstein has been tracking this effect for years. When Barack Obama took office, about 15% of persons working in the U.S. were immigrants. In Obama’s last full month, December 2016, the immigrant share had risen to just over 17%. This suggests that Obama-era immigration may have pushed as many as 3.16 million native-born Americans onto the unemployment rolls.

But not anymore. During Trump’s first two full months, immigrant employment fell by 0.26%, while native-born American employment rose by 0.78%. Of course, this is far from enough to reverse the erosion of the Obama years (let alone the Bush years). But it’s a start. (More details here).

What’s going on?

It’s not as if Trump has actually managed to do that much. His Executive Orders aimed at travel from certain Muslim countries are being held up by Leftist judges. He has not (yet) reversed Obama’s clearly-unconstitutional Executive Order temporarily amnestying so-called DREAMers (basically, any illegal alien under a certain age). After trying to cut back the so-called “Refugee” inflow (they’re really expedited, subsidized, politically-favored immigrants), he seems for some mysterious reason to have allowed it to resume.

Above all, he hasn’t even proposed legislation reducing legal immigration—let alone passed it.

But it turns out that this doesn’t matter. It’s an extraordinary example of what economists call “jawboning”—producing economic effects through informal pressure.

Ironically, it’s not even Trump’s jawbone, particularly. It’s the Democrats and the Main Stream Media (to the extent that they can be distinguished). Their hysteria about Trump has convinced the illegal aliens in the U.S. (and maybe some legal immigrants) that it’s time to leave.

This comment just in from a Minuteman whose been helping guard the border for 14 years:

A friend of mine works port of entry in Nogales and I just got off the phone with him a couple weeks ago. He told me, “You’re not going to believe the amount of southbound traffic. You know they’re coming up and they got their little trailers pulling their refrigerators, washers, dryers, their big-wheels and their ten-speeds. They’re all going south! We’re not even checking ‘em, we’re just waving ‘em through.”

It’s self-deportation. They realize the gravy’s over and it’s time to roll. When they go back to wherever they came from then they can apply for visas or passports back into the country. They don’t want to get caught up here. They get caught up here and they lose everything.

Some of these people lived here 10, 15, 20 years and they own homes and cars, got businesses. They’re just throwing in the towel and getting while the getting’s good.

What would happen if Trump actually did crack down on immigration?


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