Underliving the locals

New Zealand First's Ron Mark comments on recent high migration figures:

“At the same time, the Finance Minister Bill English admits immigration has kept wages down.

“That was the government’s intention, it is an age-old trick. It is exploiting foreign workers, particularly those from lower-waged economies, and unfair to Kiwis.

“Migrants will accept inferior working terms and conditions, and unscrupulous employers, both Kiwi and new employers from overseas, know this.

It's unfair to Kiwis that foreigners might come in and accept lower wages?

Here's Tim Leonard on the secret history of American labour market regulation:

Influential progressives already had in place theories of wage determination that were grounded in biology, arguing that certain “low-wage” races were biologically predisposed to low wages, or “under-living.” Economist-turned-sociologist Edward A. Ross volunteered that “the Coolie cannot outdo the American, but he can underlive him” (1936: 70). “Native” workers have higher productivity, claimed Ross, but because Chinese immigrants are racially disposed to work for lower wages, they displace the native workers. (Ross does not say why ostensibly more productive workers cannot command relatively higher wages.) In Races and Immigrants, John R. Commons volunteered that “the Jewish sweat-shop is the tragic penalty paid by that ambitious race” (1907: 148). Like Ross’s coolie, Commons’s Jew is industrious but less productive than native workers.

The tragedy Commons referred to is the process by which the Jewish predisposition to underlive led to destructive wage competition. Wage competition not only lowers wages, it also, for Commons, selects for the unfit races. “The competition has no respect for the superior races,” said Commons, “the race with lowest necessities displaces others” (1907: 151). Labor leader (and Socialist Party presidential candidate) Eugene Debs said of Italian immigrant workers: “The Dago . . . lives more like a savage or a wild beast than the Chinese,” and therefore can “underbid the American working man” (1891, quoted in Glickman 1997: 89). Wharton School reformer Scott Nearing volunteered that if “an employer has a Scotchman working for him at $3 a day [and] an equally efficient Lithuanian offers to the same work for $2 . . . the work is given to the low bidder” (1915: 22). For these progressives, race determined the standard of living, and the standard of living determined the wage, with adverse consequences for the superior, “high-wage races” (see Leonard 2003a).

There are very legitimate worries about exploitation of foreign workers whose visas are tied to their employer's happiness with their work. But, thankfully, contemporary discourse has flipped away from arguing there's any innate racial propensities for 'underliving'.

It's plausible that reservation wages of those moving here are lower than reservation wages of those who are here. Such worries motivated much of the push for minimum wages in the US during the progressive era: they were designed to make unemployable those who would underlive Americans or women, who were presumed to have lower productivity than men and so would be disemployed by the minimum wage and sent back to the kitchen. New Zealand's minimum wage is already $14.75/hr; if migrants are undercutting Kiwis for wages in low-skilled work, they haven't a lot of margin on which to do it.

In related news, Oliver Hartwich, Executive Director here at The New Zealand Initiative, today received his New Zealand permanent residence. Jason Krupp is soon to be made a citizen. I've been a permanent resident since about 2004; I arrived here in 2003. Martine Udahemuka arrived here as a refugee.

We turk er jurbs?