At last we are to have an immigration system which will force employers to train-up the indigenous population, instead of allowing them to employ imported cheap labour, which the state must then subsidise with in-work benefits. This is clearly an improvement. Yet even among the most ardent proponents of a ‘points-based’ immigration system, we hear the same hoary old platitudes: breathless talk about welcoming ‘the brightest and the best’ from around the world, people with ‘higher-level skills’, those who earn less but are in designated ‘shortage sectors’, or even just those who have come here to ‘contribute’ – as if without the obligatory positive spin, one is revealed as a rabid xenophobe. Like junkies, they just cannot kick the immigration habit.
A generation ago, there was no net immigration into this country – and yet real wages were rising, people could afford to get onto the housing ladder, ordinary people could make ends meet, save and put some money aside for their old age, and there were none of the critical labour shortages that seem to afflict us now. Why? Because, broadly speaking, the economy was in balance. Net investment in plant and machinery, in skills, in the capital stock or ‘infrastructure’, yielded gains in productivity that financed year-on-year real wage increases, better public services and pension provision for an ageing population. The forces of demand and supply were brought into equilibrium as they should be in the market – namely, through the price mechanism. So, for example, a sectoral shortage of labour would force up wages, attract new workers, and by raising costs to employers and consumers alike, both encourage investment to raise productivity and produce a reduced demand for labour.
Mass immigration, on the other hand, puts everything out of kilter. The capital stock is spread too thinly, overall investment and productivity decline, real wages fall, and inevitably the resentment of the indigenous population grows. For when ready-skilled (or unskilled) workers are imported to fill the gap, the shortages and prospective shortages that would force up wages and generate more investment and training in specific sectors of the economy cannot develop. True, we get skills on the cheap, by depriving poorer countries of them – that is an ethical question-in-itself. But the indigenous population is forced downmarket into lower skilled occupations, and there is added pressure on housing and services. The houses occupied by imported labour deplete the existing housing stock, for house building is financed out of savings (mortgages are usually repaid over a lifetime), not current income – as is the building of schools, hospitals and roads, which form part of the nation’s stock of capital accumulated over generations.
Using labour shortages as an excuse to import labour is simply a recipe for unsustainable population growth, unsustainable pressure on housing and public services, and a vicious spiral of low wages, low investment and low productivity. And this is before we even consider the cultural impact, the effects on people’s way of life, on social cohesion. It is also a convenient recipe for improving the cossetted lifestyles of a professional liberal elite, whose domestic needs are ministered to by a new underclass of servants, a reserve army of cheap labour, at the expense of the rest of the population.
So, should we let anyone in? Of course, not all immigration is bad. When immigrants bring with them skills and know-how we don’t have, they are unquestionably an economic benefit. The Huguenots and Flemish weavers are historical cases in point. Individuals may bring their personal talents and genius – or just their money. Perhaps those who are especially attractive should be given preferential treatment on aesthetic grounds. There are, of course, also humanitarian grounds for allowing people to settle here.
But current policies are simply a recipe for continued population growth. And if the newcomers are considered ‘brighter and better’ than the indigenous population, it is more like a recipe for population replacement.
Now, whose interest is that in?