On Tuesday, the Wall Street Journal‘s Jason Riley fretted that backlash after the Boston Marathon bombings could derail the U.S.’s latest attempt to reform its beleaguered immigration system. Riley recounted how President George W. Bush had taken office in 2001 with the best intentions to address that very issue, only to quickly shelve such plans after 9/11. Might the current push for an immigration overhaul be destined for a similar premature death? “As of this writing, the authorities say they have no suspects in the Boston attack,” Riley concluded, “When they do, the nationality of the person or persons may well determine whether the current immigration-reform effort goes any further.”
As of this morning, we know the two suspects to be Chechen siblings, recent immigrants to be precise. Somewhere on the Internet, the elder of the two is quoted as saying: “I don’t have a single American friend, I don’t understand them.” There’s plenty of ammunition there to fire up those who oppose immigration reform and curb the enthusiasm of those who had started to warm up to the idea.
It would be a real shame if the attack did indeed stop immigration reform in its tracks—a shame for Canada too. In a recent study, Douglas Holtz-Eakin, formerly director of the Congressional Budget Office and now president of the American Action Forum, finds that more immigration to the U.S. would boost short-term GDP growth by about 1%. There would be an even greater impact in the medium-term as per capita income would increase by $1,700 after ten years and it would produce an estimated $2.7 trillion in federal deficit reductions over a decade. The first and foremost benefit from a significant increase in foreign newcomers, according to Holtz-Eakin, is a reversal of the current trend of slowing population growth, which, if persistent, leads to slow growth and rampant budget deficits, a threat that hangs over several Canadian provinces as well. But, notes Holtz-Eakin, immigration doesn’t simply inject warm bodies into the economy to produce more aggregate output and pay more taxes. Immigrants’ contribution to economic growth tends to outweigh that of an equivalent-size increase in the native population because newcomers have higher labour participation and entrepreneurial rates. A more immigration-friendly U.S. would be a more dynamic, faster-growing U.S., an unquestionable benefit for Canada.
Of course, any immigration reform Congress is able to stomach might allow for considerably lower and slower inflows than the ones required to yield the outcomes Holtz-Eakin describes. The bipartisan bill introduced on Tuesday by Democratic New York Senator Charles Schumer and Republican Arizona Senate veteran John McCain is already far less ambitious than earlier proposals. Still, the current bill’s basic tenets—finding a path to citizenship for 11 million illegals, raising the cap for skilled immigrant visas and scrapping the absurd green card lottery for a merit-based system—would undoubtedly bring seizable economic gains.
Admittedly, they would also boost U.S. competitiveness on the global labour market, which might hurt our chances to attract the best and brightest, especially at a time when the Canadian economy slows and America’s picks up speed. For over a decade Canada has been able to exploit Uncle Sam’s wrong-headed immigration rules to its own advantage. Foreign graduates with prestigious U.S. degrees who could not stay on? Talented foreign workers who could not renew their U.S. work visa? We’ve been waiting for them with open arms. Between 1998 and 2008, the number of skilled workers coming to Canada from the U.S. more than doubled, Colin Campbell and Charlie Gillis reported over at Maclean’s some years ago.
Still, there’s no real reason for Canada to give in to schadenfreude and hope for another U.S. immigration reform fail. A stronger U.S. economy is in all likelihood a much larger gain to Canada than any marginal advantage in the competition for talent we might have enjoyed in the past few years. Besides, if we really are concerned about losing some of those international brains to the folks down south, who’s to stop us from upping our own immigration game?
Erica Alini is a California-based reporter and a regular contributor to CanadianBusiness.com, where she covers the U.S. economy. Follow her on Twitter: @ealini.