Migrants bring joy and prosperity

May 29, 2011. Read this morning in the Economist as a wake up call for a new day: ‘If rich countries were to admit enough migrants from poor countries to expand their own labour forces by a mere 3%, the world would be richer, according to one estimate, by $356 billion a year. Completely opening borders would add an astonishing $39 trillion over 25 years to the global economy. That is more than 500 times the amount the rich world spends on foreign aid each year. Migration is the most effective tool yet devised for reducing global poverty.’

Frank van Empel for Ecolutie

Nothing new for me as an economist, because I know that there are two flips to every coin, and so has every other aspect of a specific phenomenon like migration. The same worker can earn 10 to 15 times as much if he or she moves from say, Ethiopia to the Netherlands. The wage gap between rich and poor countries is far wider than it was a century ago. The emotional costs of leaving home, though still hefty, are much lighter than they were. To quote the Economist: ‘A 19th-century Russian emigrant might never see or speak to his family again. A 21st-century migrant can Skype them in the taxi from the airport. No wonder that the number of international migrants has doubled in the past quarter century, to more than 200m. Increasing mobility combined with cheaper communications means that in the future, the global community is becoming connected in a manner not experienced since our small-world evolutionary origins in Africa.’[1]

Poor migrants who work in the rich part of the world send ‘home’ almost all their earnings. Doing so they are helping to smooth out the differences in wealth worldwide. People who get the money send by bank, spend it completely to usefull things like food and shelter. The farmers who produce the food and the construction workers who build the shelters will spend it adequately too. The money multiplies faster in countries like Ethiopia and Marocco than in fat countries like the Netherlands, where round bellied people just add more lazy money to their bank account or spend it on a third tv or second car. Money just moves faster through the economy in a poor country and as long as the production capacity is not completely occupied, the prices won’t rise, but the volume of economic activities will.

That is the secret of the European Union: Money travelling  from north to south boosted the economies of Portugal, Spain, Italy and Greece in the 1960s and 1970s and nowadays the same trick works out well from west to east. Right wing politicians who hammer on the migration issue and on the issue of debt, are wrong. Together we would be better off when we (all the rich countries) would open our inflexible and slow labour markets to fresh, willing people from outside. Think of all that nine-to-fivers working for the government, banks, energy-companies and other sheltered (from real competition) and tied (with red tape) parts of our gated European and North American economies and communities. Newcomers would have shaken up our lazy bones and would have trimmed down our fat asses. They would have blown more entrepreneurial spirit into our economies. In the economy as well in psychology exists some kind of principle that can be labelled as ‘mutual gains’. The money we give to someone who needs it badly, will come back somehow, sometime, somewhere in our local and regional economy. If the poor get richer they need some of our products and services too. We could have been richer and healthier as we are now and we still can be richer in body, mind and bank account tomorrow if we throw off our anxiety for the unknown and unexperienced. Joseph Schumpeter already noted that new ways of thinking and doing face a lot of problems: ‘In the breast of one who wishes to do something new, the forces of habit rise up…The reaction of the social environment against one who wishes to do something new, may manifest itself first of all in the existence of legal or political impediments…Any deviating conduct by a member of a social group is condemned…Even a mere astonishment at the deviation…exercises a pressure on the individual.’[2]

We have to change our narrow minded thoughts and politicians for more openhearted and openminded ones. Migrants are not creepy, they bring prosperity. Rightwing, narrow programmed politicians are stealing our money and lives.

[1] Exceptional People: How Migration Shaped Our World and Will Define Our Future. By

Ian Goldin, Geoffrey Cameron and Meera Balarajan. Princeton University Press; 352 pages;

$35 and £24.95.

[2] J.A. Schumpeter, The theory of economic development, Harvard University Press, 1934.

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