Tag Archives: immigration

Alt Right: Consumerism, Crony Capitalism, and Immigration

I’m sure everyone has seen the alt-right ‘mural‘ of the various things that the alt-right supports and supposes.

A few observations: I’m kinda surprised by how it ‘strongly opposes’ SJWs but only ‘moderately opposes’ SJW-media. Also surprised that it only has ‘minor opposition’ to crony capitalism and excess consumerism, which I actually agree. Consumerism, although it can be a vector for moral decay, is necessary for an economy to grow. Without people buying stuff, ultimately, there is no economy, and the best an the brightest will have a reduced standard of living or have their talents misappropriated. To some extent, low and medium-IQ consumers are the ‘bedrock’ that the creative and cognitive class are built upon; however, the wealthy do consume more than the poor. Abstract research (physics, mathematics, etc.) would stagnate if not for consumerism to keep the economy going. Economic collapse would probably cause research & development budget cuts (at both the private and public level) causing research to stagnate.

Crony capitalism, as I have discussed a couple times here, is merely the government allocating resources to sectors and industries, and is not the ‘unalloyed evil’ that some make it out to be. One could make the argument that crony capitalism, if used to promote pro-growth policy, represents a near-optimal transfer of capital that otherwise wouldn’t occur. An example is to fund a war effort – if the US need to mobilize quickly, it may pay manufactures to produce war equipment.

Notice under ‘strongly oppose’, there is a huge qualifier, ‘mass’, appended to immigration. That leaves the possibility for just ‘normal’ immigration, which the mural neither supports nor opposes. This suggests some ambiguity on the issue – how much immigration should be allowed, and for whom? Very few politicians support ‘mass immigration’, as it would probably be political suicide, even in the pre-Trump era. Usually they either support ‘more reform’ (the right) or ‘less reform’ (the left).

Mike, an important figure of the alt-right despite he himself rejecting the label, believes everyone, regardless of national origin, should be allowed to immigrate provided his or her IQ is high enough.

To some extent this is a good idea, as smart immigrants tend to create jobs, innovation, and investment. As explained in an earlier post, the evidence that H1-B visas depress wages and displace labor is somewhat lacking.

However, the concerns of ‘natives’ are still valid, and the perception of job displacement and wage suppression cannot be ignored. Smart immigrants in the tech sector may drive-up real estate prices in certain areas (as we’ve seen in Silicon Valley), forcing others to commute longer or making home ownership unobtainable. The other issue is that all immigrants, regardless of IQ, bring their families (daisy chain immigration), and over many generations the ethic makeup of the region may be changed. A third issue is ‘reversion to the mean’, in which the decedents of smart immigrants become less intelligent due to admixing and other factors. Some solutions include: only allowing immigrants of European ethnic lineage or replacing naturalization with guest worker programs (this way, visitors can never become citizens, nor be eligible for the same benefits as citizens).

I discuss the matter in more detail in The Hivemind, Immigration, and IQ:

…This lends support to high-IQ immigration. Having a larger pool of labor helps if we consider a situation where a foreigner is qualified and there are no qualified Americans applying, or the foreigner is more qualified, or the foreigner is qualified and can do the work for less. But tech companies in America are still paying top dollar for top US talent. Also, smarter immigrants tend to create jobs.

However, a counterargument is that foreign workers depress wages and take job opportunities that would otherwise go to native tech workers. As I show here, what’s more likely happening is that tech companies are not substituting US workers with foreign workers to save money, as is commonly believed. The report finds that STEM jobs are also hard to fill.

Unfortunately, there isn’t a consensus on the matter, with arguments showing that immigrants may or may not depress wages. A Google search indicates the debate is far from settled.

The issue is far from settled.

The Daily View: Today in Stupid

A child genius explains how she can memorize a shuffled deck of cards in less than an hour

That’s like saying ’7-foot-tall basketball player shows how he dunks basketball’…gee I wonder if being tall/genius has anything to do with it?Geniuses are good at memorizing stuff, that’s what makes them geniuses, no shit, Sherlock. Mnemonic are helpful, but you still have to memorize the mnemonic. With the exception of a handful of ‘idiot savants’, all mental feats (mental math, memorization, speed reading, etc) are are tantamount to IQ.

———-

JOHN MCAFEE: It’s extremely odd Donald Trump apparently doesn’t have a computer on his desk

So this fool who lost his fortune in the 2008 financial problem, went crazy, and then nearly got himself killed in Belize (probably for pissing them off with his stupidity) thinks is he qualified to ‘advise’ Trump.

The first photo that I saw of Donald Trump at work alerted me to a potential issue. There was not a single laptop, pad or other smart device anywhere on his desk. Given the fact that my own office, and the offices of everyone that I know are virtually littered with active screens, I found this to be odd in the extreme.

Has he ever heard of Twitter? Apparently, Trump uses it a lot, evidence he is technologically illiterate. There are many explanations besides technological illiteracy that might account for the absesne of a computer in that photo. Maybe Trump uses a smart phone, in which case it wouldn’t be visible it were in his pocket when the photo was taken. In fact, here’s a photo of Trump tweeting.

In August 2009, The New York Times reported that McAfee’s personal fortune had declined to $4 million from a peak of $100 million, the effect of the global financial crisis and recession on his investments.[9]

What a loser. Trump still has his fortune, so whatever he’s doing seems to be working.

———-

The backlash in the replies, as expected. Online, the SJWs are outnumbered. I don’t know the ratio exactly, but they are of the minority and are losing (online that is).

——–

And finally…

Dr. Anjali Ramkissoon, the drunk woman that was caught on camera attacking an Uber driver and smashing his cell phone, HAS been placed on administrative leave and removed from all clinical duties.

Like before, the backlash is always in the comments…

The thing that pisses me off most about this story is the blatant privilege and entitlement she exhibits. When she goes on about how she’s “100 pounds” and a “5 foot girl” she’s basically saying that she’s expecting to get off scot free on the basis that no one will believe the uber driver’s story. “I’m a little girl in med school and you’re just a dude who drives an uber, so say what you want but nothing will come of it” kinda vibe. Completely disgusting mentality. Edit: Clarification & grammar

Classic female bully here, assaults driver knowing he can’t fight back, laughs while she walks away from destroying his property. I some how doubt she had one too many.

So much for America being patriarchy, as SJWs insist it is …

The Hivemind, Immigration, and IQ

From ricochet.com, A Review of Hive Mind: How Your Nation’s IQ Matters So Much More Than Your Own

From the reviews on Amazon:

The book’s primary and most important contribution is to document the following empirical regularity: Suppose you could a) improve your own IQ by 10 points, or b) improve the IQs of your fellow countrymen (but not your own) by 10 points. Which would do more to increase your income? The answer is (b), and it’s not even close. The latter choice improves your income by about 6 times the former choice.

One implication of the regularity should please some conservatives—perhaps especially Ann Coulter and Donald Trump. It says that, if the U.S. continues its current policy of admitting many third-world immigrants, then this will likely decrease the incomes of current citizens. Alternatively, it also implies that a better policy would be to admit only “the best” people, in the words of Donald Trump.

Regarding the second point, the problem is the immigration debate has been dominated by politics, overshadowing economics. The solution may be to stop or restrict immigration from countries or demographics where there is likely to be a net economic drain.

Hispanics tend to use welfare at a much higher rate than Asians or Europeans (observed for both natives and immigrants):

This lends support to high-IQ immigration. Having a larger pool of labor helps if we consider a situation where a foreigner is qualified and there are no qualified Americans applying, or the foreigner is more qualified, or the foreigner is qualified and can do the work for less.But tech companies in America are still paying top dollar for top US talent. Also, smarter immigrants tend to create jobs.

However, a counterargument is that foreign workers depress wages and take job opportunities that would otherwise go to native tech workers. As I show here, what’s more likely happening is that tech companies are not substituting US workers with foreign workers to save money, as is commonly believed. The report finds that STEM jobs are also hard to fill.

Unfortunately, there isn’t a consensus on the matter, with arguments showing that immigrants may or may not depress wages. A Google search indicates the debate is far from settled.

As for the first point regarding national IQ and income, I’m not so sure about this. Because I have not read the book (and am going by the review), I don’t know if the author makes the distinction between nominal incomes (which are rising) and real (which have been flat for awhile).

Linear regression models show a positive correlation between national IQ and per-capita income, originally observed by Richard Lynn and Tatu Vanhanen in their book, IQ and the Wealth of Nations:

Per-capita income has also soared:

However, real median income has been stagnant despite rising GDP growth:

I think what’s happening here is that per-capita income is skewed in favor the financial ‘elite’, who have seen real wages surge, while the median lags.

Per-capita income is a mean value and does not reflect income distribution. If a country’s income distribution is skewed, a small wealthy class can increase per capita income substantially while the majority of the population has no change in income. In this respect, median income is more useful when measuring of prosperity than per capita income, as it is less influenced by outliers.

Booting the nation’s IQ will likely boost exports, GPD, profits, and technological innovation – but not necessarily real median wages. But that may be OK, though, because new technologies lead to more utility, as in the example I give of TV sets or movie tickets. Technology may improve living standards, so much so that wealth inequality and stagnant wages may not matter. The result, however, may be an ‘un-participatory’ economy where a lot of people are not contributing much to economic growth, nor are participating in the gains such as measured by real wages, in accordance with the Pareto Principle.

The Free Trade & Globalization Debate

From Vox Day: The Price of Free Trade

In the context of this debate, ‘free trade’ includes exports, offshoring, and insourcing & outcsourcing (of labor), or just simply globalization. The problem with macro economics is with the exception of the fundamentals (like comparative advantage), there is seldom a consensus, unlike subjects such as mathematics and most physics, where everyone can agree on a set of fundamental laws that govern the universe or a set of axioms and postulates that build the foundation of mathematics. The problem is Vox Day doesn’t offer any concrete evidence or statistics to support his anti-free trade position, leaving the research to the reader.

I can understand the ethnocentric argument, but the macro argument against free trade is not as persuasive. If free trade were as bad as its detractors insist it is, it would have been ‘phased out’ by the natural evolution of free market capitalism, but its persistence lends credence to its success.

The major benefit of free trade is it allows America to export inflation, resulting in cheaper goods here.

Another benefit is globalization reduces the likelihood of war, as economically interdependent countries would have more to lose by going to war with each other:

Using these dyad-years, McDonald analyzed the behavior of every country in the world for the past 40 years. His analysis showed a negative correlation between free trade and conflict: The more freely a country trades, the fewer wars it engages in. Countries that engage in free trade are less likely to invade and less likely to be invaded.

For example, by becoming a global exporter, Japan’s economy boomed after WW2:

Same for Germany. Choosing trade over war definitely paid off.

On the other hand, a counter-example where Russia invades Ukraine despite the presence of a McDonald’s franchise .

A I discuss here, there is evidence that H1b visas don’t suppress employment and wages among native-born Americans. During strong economic times, companies add both native and foreign born workers instead of only adding only foreign workers, as shown by how the visa cap is closely correlated with the economic cycle.

Vox writes:

The USA historically enjoyed its fastest periods of economic growth under protectionist, restricted-immigration periods.

But correlation is not causation – protectionism wasn’t the cause of strong economic growth, it may have merely coincided with it. It was much easier to grow the economy decades ago, as it was much smaller and the ‘low hanging’ fruit had not been picked. The US population growth rate is half it was a generation ago, and foreign markets offer new avenues of growth.

Also, manufacturing was already in deceline in America, before NAFTA. From Wikipedia:

The rate of job loss due to plant closings, a typical argument against NAFTA, showed little deviation from previous periods.[13] Also, US industrial production, in which manufacturing makes up 78%, saw an increase of 49% from 1993-2005. The period prior to NAFTA, 1982-1993, only saw a 28% increase

Although globalization and free trade may lead to the closure of some jobs and the displacement of labor, immigrants and foreign companies also create jobs in America. For example, foreign auto brands building plants in America:

And immigrants create companies, which leads to job creation – as many as 10 million jobs created within the fortune 500:

The lump of labor fallacy is the belief that there is a fixed amount of labor to go around, that once taken no new jobs are available.

That probably cancels out some or all of the jobs lost to globalization.

A report by Brookings sheds some light on the issue:

According to one study, 25.3 percent of the
technology and engineering businesses launched in the United
States between 1995 to 2005 had a foreign-born founder. In
California this percentage was 38.8 percent. And in Silicon Valley,
the center of the high-tech industry, 52.4 percent of the new
tech start-ups had a foreign-born owner. According to the study’s
count, “Immigrant-founded companies produced $52 billion in
sales and employed 450,000 workers in 2005.”4

Notable examples include Ebay, Yahoo, and Google.

However, All Net Jobs Growth Since 2007 Has Gone to Immigrants

From November 2007 through November 2014, the number of employed native-born Americans has decreased more than 1.45 million, while the number of employed immigrants has risen by more than 2 million (as the immigrant population grew rapidly, too), according to data compiled by the Department of Labor’s Bureau of Labor Statistics.

From Brietbart MOST NET JOB GAINS WENT TO IMMIGRANTS SINCE RECESSION

In December 2007 the number of foreign-born workers was 22,810,000. By April 2015, the number had increased to 24,819,000 or a net job growth of more than 2 million.

For native-born workers that number in December 2007 was 123,524,000 by April of this year the number of employed native-born Americans was 123,769,000 or a net job growth of 245,000.

However, a user on Reddit counters, arguing that immigrants and natives fared about the same, but it seems worse for natives because of the starting point chosen:

Seems strange to pick January 2007, the top of a bubble, as a starting point. But even if we do, employment is basically unchanged for the native born (-0.04% change for the native-born), while is actually twelve times worse, comparatively, for immigrants. (-0.5% change). So even in the most data-abusive case, this argument is wrong according to the tables they present, in Table 1. (The math there is simply take the employment rate over the total population minus not-in-labor-force)

If we pick the BLS dates of the recession (12/07-6/09), then immigrants were left significantly worse off. Unemployment for natives was down 4.8%, but was down 5.1% for immigrants. Immigrants suffered worse during the recession. Perhaps that helps explain why the flow of Latino immigrants to the US decreased during the recession.

If we take the time period of interest as when TARP went into effect until now (the time frame everyone is interested in), we see that from the first big asset purchase (November 2008) until last month, the unemployment rate for natives changed by 122558/(208817-79056) – 122326/(199401-68621) = 0.9%, while for immigrants the unemployment rate changed by 25108/(40027-13491) – 22283/(35427-11583) = 1.1%. So at 44% vs 56% of the overall change, I’d say both “groups” broke about even since the recovery. Immigrants and natives shared equally in job gains. The posted article is incorrect.

But this all rests on a model where “taking jobs” is the sole function of immigration. That model is a lousy one. Immigrants start more business, are responsible for more new employment, and are over-represented among startups and the Fortune 500 by a wide margin. The new share of available jobs is highly attributable to immigrants. We fear-monger at our peril.

So you have evidence on the pro and con side that conflict with each other. Make of it what you will. But I think the pro-globalization argument wins, at.