Today’s Mises Daily outlines some of Mises’s ideas about the economics of immigration. As always, Mises is thoughtful and perceptive, and continues to offer fresh insight decades after his death.
Mises wrote voluminously and on virtually every important topic in economics, so it’s unsurprising that not all his comments would fit in a short article. There’s always more Mises to read, so for those interested in digging deeper into his ideas about immigration, I’m adding this post as a sort of appendix.
Mises first mentioned immigration in his early essays, after which he devoted a discussion to it in his neglected book Nation, State, and Economy (1919). Here, he outlined the position he would elaborate on in later works, namely, that some type of immigration is inextricable from the division of labor, because factors of production tend to move to those places where they are most productive. He also explained that protectionist measures are often to blame for government policies that control immigration. These two points appear repeatedly in other writings as well, especially Socialism (1922), Liberalism (1927), and a 1935 essay titled, “The Freedom to Move as an International Problem.”
Throughout these writings, Mises’s analysis of the causes and consequences of immigration is quite consistent. Characteristically, his approach highlights the importance of peace and cooperation, and the evils of protectionism. This is no surprise, as Mises was himself a refugee immigrant who arrived in the US with little in the way of wealth and less in terms of prospects, and it was only several years after his arrival that he managed, through the influence of friends, to secure a position at New York University.
Mises’s clearest statement of his views on immigration appears in Liberalism, where he suggests that “This issue [i.e. conflict between natives and immigrants] is of the most momentous significance for the future of the world. Indeed, the fate of civilization depends on its satisfactory resolution” (1927, 141).
For Mises, liberalism is closely connected with free trade and especially the ability to emigrate:
The liberal demands that every person have the right to live wherever he wants. This is not a “negative” demand. It belongs to the very essence of a society based on private ownership of the means of production that every man may work and dispose of his earnings where he thinks best. This principle takes on a negative character only if it encounters forces aiming at a restriction of freedom of movement. In this negative aspect, the right to freedom of movement has, in the course of time, undergone a complete change. When liberalism arose in the eighteenth and nineteenth centuries, it had to struggle for freedom of emigration. Today, the struggle is over freedom of immigration. At that time, it had to oppose laws which hindered the inhabitants of a country from moving to the city and which held out the prospect of severe punishment for anyone who wanted to leave his native land in order to better himself in a foreign land. Immigration, however, was at that time generally free and unhampered. (1927, 137)
Mises saw the immigration of his day as a fight between liberalism and protectionism, one where government policy was primarily driven by unions:
Aside from such coercive measures as the closed shop, compulsory strikes, and violent interference with those willing to work, the only way the trade unions can have any influence on the labor market is by restricting the supply of labor. But since it is not within the power of the trade unions to reduce the number of workers living in the world, the only other possibility remaining open to them is to block access to employment, and thus diminish the number of workers, in one branch of industry or in one country at the expense of the workers employed in other industries or living in other countries. For reasons of practical politics, it is possible only to a limited extent for those engaged in a particular branch of industry to bar from it the rest of the workers in the country. On the other hand, no special political difficulty is involved in imposing such restrictions on the entrance of foreign labor. (1927, 138)
Like all forms of protectionism and price controls, the unions’ attempts to “justify on economic grounds the policy of restricting immigration are therefore doomed from the outset” (1927, 139).
Protectionism is sure to cause conflict between favored and non-favored groups. Free trade, on the other hand, promotes peace and prosperity:
More clearly than all theories could do, the course of history shows that properly understood patriotism leads to cosmopolitanism, [and] that the welfare of a people lies not in casting other peoples down but in peaceful collaboration. (1919, p. 104)
Importantly, whatever the causes of conflict between natives and immigrants might have been, for Mises, the state did not provide a remedy:
It is clear that no solution of the problem of immigration is possible if one adheres to the ideal of the interventionist state, which meddles in every field of human activity, or to that of the socialist state. Only the adoption of the liberal program could make the problem of immigration, which today seems insoluble, completely disappear. (1927, 142)
