A second Donald Trump presidency is only a couple of months away, which means that it is time to reckon with one of his major economic policies, immigration reform. During the campaign, comments about migrants eating dogs probably got more attention than the details of his proposals or evidence on their effects. In this episode, we are going to rectify that by asking what a Trump presidency means for immigration.
This is the Economics Show with Simea Keynes. I've joined today by Michael Clemens of George Mason University, an expert on the economics of migration and a scholar of its history. Michael, hello. Hello, how are you? Oh, you know, fine. How are you? It's a moment of historic change in the United States, and we're going to talk about some of that.
we are indeed. Okay, so we are going to start off with a silly arbitrary question on a scale of 1 to 10, where one is the least restrictive it could possibly be and 10 is the most restrictive. Where would you put Trump's immigration policies during his first term?
During the first term, the 10 is the most restrictive in all of United States history, let's say seven in that the Chinese Exclusion Act and the 1924 immigration shutdown slashed immigration to the United States by substantially more than Trump succeeded in slashing it during his first administration.
Okay, and now follow up question, where would you put his second term, or at least what he's been saying about what he would do? Well, there's no doubt that there's a substantial increase in restrictionism this time around, so I'd say we're headed more for eight or nine. Okay, well, both pretty high numbers there. Okay, now for the real questions. What has Trump consistently said that he would do on US immigration policy? And I actually want to start by asking about legal migration.
He has advocated severe restrictions on high-scale visas to the United States for non-immigrant workers, the H-1B visa. He has advocated the elimination of entire categories of family sponsorship, such as US citizens who sponsored their parents to come join them in the United States, such as lawful permanent residence green card holders in the United States, bringing their spouses or dependent children to join them in the United States, literally eliminating the legal possibility for that to happen, and many others.
So reading the reports, I was struck by a promise to remove birthright citizenship. How big of a deal would that be?
Well, birthright citizenship goes back to constitutional reforms that happened after the Civil War, whose intention after all enslaved and non enslaved African Americans had been stripped of their citizenship by a Supreme Court decision. The US changed the constitution to make sure that everybody born on US territory would become a citizen. So this is a very, very long-standing tradition. It was established very explicitly and directly to overcome
racist restrictions on citizenship in the United States. And now it is being explicitly challenged and not just to restrict the conferral of new birthright citizenship, but the administration in its first time around did establish a task force for a denaturalization of people who had received birthright citizenship due to their concerns about the legal status of their parents, something which the Constitution says nothing about, but seems to be a policy preference of theirs.
And Stephen Miller, who is the person who will design and implement once again the new Trump administration's immigration policy, has said publicly that his program for denaturalization of existing U.S. citizens would be, quote, true, go charged, unquote, in the new administration. But hang on, if this is a constitutional issue, wouldn't changing that require a constitutional amendment, which Trump wouldn't have the majority for?
It's all down to the legal interpretation of the Constitution, and on that front, the current Supreme Court, which was largely constituted by Trump himself, has given him enormously way on various issues, and I wouldn't expect resistance on this one.
Okay, so just moving on to another thing that I've seen discussed. There's been talk of revoking visas for anti-Semitic and anti-American activists. Have you been following that? It's somewhat the Trump campaign the first time and certainly this time has made all sorts of pledges about excluding from the United States various kinds of immigrants that it deems undesirable.
the first time he campaigned on eliminating all Muslim arrivals in the United States and this time around he's been talking less about Muslims although those are clearly comprised by the proposal for new and extended travel bans to include also people to be eliminated based on their opinions by some ill-defined criterion and it's been very popular on the campaign trail. I would caution against dismissing them as simply cheap talk because we have the example of Muslim exclusion which was
a very strong statement that played well on the campaign trail and certainly was implemented and even survived the test of the Supreme Court in Trump versus Hawaii. Okay, so it might sound ridiculous, you know, agents combing through people's social media statements to find out who has been protesting on certain issues, but past experience would suggest don't dismiss this.
Absolutely. I mean, Muslim exclusion on its face is administratively infeasible and the administration did find a way to implement it. They successfully eliminated essentially all refugee arrivals in the United States who are Muslim faith. So they are creative and legally knowledgeable and have a track record of turning policies that are difficult to administer into effective ones.
OK, well, now I want to talk about policies meant to reduce illegal migration, which I think has been more prominent in the campaign rhetoric. So could you first of all give us some numbers? I mean, roughly speaking, how many illegal migrants do we think there are currently in the US?
The shorter answer is probably just above 12 million. That's the latest estimate of the Center for Migration Studies in New York City, which has a very credible methodology for assessing that. A much longer answer is that the Trump campaign has successfully branded in the media and the public their campaign of mass deportation, which is set to begin 11 weeks from today.
as a campaign against people who are in the country illegally. And that's simply not true. It's part of a broader campaign that will include the elimination of legal status of people who have it now and could include a direct targeting of US citizens. By that I mean
under the current administration, about 1.3 million people have been allowed to enter the country with parole, which is not an admission under law into the United States. It's allowing to entry without rights that come along with admission. It is a legal status. The definition of lawfully present in the United States includes people who are admitted or paroled. So all 1.3 million of those people are lawfully present in the United States, and removing their parole status, which is an explicit goal of the administration, and thus placing them
into no status at all and thus being deportable is part of the plan. So this is a plan to remove people who are lawfully present in the United States and others who are not lawfully present. I really wish that the public discourse would capture that plain fact.
Another thing that is really crucial to assessing the impact of mass deportation in the United States, even of people who don't have lawful status, if we're thinking of the roughly 12 million or a little bit over 12 million who don't have lawful status,
is how deeply integrated into American society as well as the economy. These people are really striking fact that not many Americans are aware of is that 6% of all children in the United States. Everybody who is under age 18 is somebody who is both a US citizen and has at least one unauthorized parent.
So that's 4.4 million children. It is simply not possible to target millions of unauthorized immigrants without directly affecting in a very serious and intimate way millions of US citizens.
Okay, and do you have a flavour of what this might look like? What a Trump administration would try to do? They've been very explicit about what they'll do. They would have agents of the federal government immigration and customs enforcement called ICE carry out sweeps of public and private places to attempt to correctly identify and round up into large camps. That's what the campaign has said it will do.
And it has said that the existing force of ICE officers would be nowhere near sufficient to carry out those acts, which is why they have stated an intention to mobilize national guard troops. And in occasional statements, they have also described a policy of recalling to the homeland overseas active military personnel to assist in that effort. So we're talking about a vast militarized
sweep of public and private places across the United States, rounding up millions of people a year into camps for processing. And that is, I think, the scale and just vision of what that's going to mean for the country is something that has not arrived in the public consciousness. Can they do that? Can they just call in the military? I thought there was some sort of constraint against that.
The administration did successfully deploy active military personnel to the US Southwest border when it imagined that caravans of migrants were arriving at the border in large numbers. And that didn't experience any serious challenge from the other branches of government that are intended to create checks and balances for actions of that kind. So I don't have a reason to expect that the other branches would step in this time as well, although they might.
Right. Can I ask whether you think there would be any constraints operating here? I guess, I mean, you know, maybe legal challenge or just a resource constraint. No, I don't think that. And that's certainly debatable. Let's think about the legal constraints that the president faces. There's a longstanding doctrine of the US Supreme Court called the plenary power doctrine, which gives the executive branch
extreme discretion in regulating entry to the United States. And there are limits on it once an immigrant is admitted to the United States. That's why the difference between admission and arrival is so crucial. Admission means you have a visa, you have some sort of regular legal permission to enter and remain in the United States.
Once you are admitted to the United States, you have rights to do process of law for matters affecting your immigration status. If you're not admitted, you don't. The executive has a very broad authority to deny you entry or remove you.
that the judiciary has traditionally not challenged. And then on costs, I mean, the first time around, the president promised that he would pay down the national debt within eight years. That was a campaign promise back in 2016. The US national debt rose by $7.8 trillion under the first Trump administration. Then, by the way, the annual deficit went from 3% to over 5% during the years of the Trump administration before the pandemic.
So that was just a willingness to fund current activities by borrowing from future generations. And I can't imagine a cost constraint that would bind on an administration that's willing to simply suspend the money of children on its priorities for today.
Yeah, I don't remember seeing the debt being paid down. Just another constraint. I mean, if you are going to deport millions of people, doesn't that rely on the agreement of other countries to sort of receive those people back?
Yes, it does. It's certainly not possible to just send people to Venezuela without the cooperation of the Venezuelan government under international law. And there have been proposals for indefinite detention. There have been proposals for deporting people to third countries. Like many of the stated policies of the administration, the details of this nature have not been carefully thought out. But there's certainly a large number of countries that do receive deportees from the United States.
represented among people who are here currently.
people of Mexican nationality, Guatemala nationality, Colombian nationality, and those constraints would not limit the ability of the administration at least to conduct mass deportation in the millions. But you're right that at some point for some nationalities, it would be an important constraint that they would have to find creative ways around. And as I said, there is a long track record of this administration's immigration policymakers finding
administratively feasible ways to enact policy that is difficult.
Okay, well, look, so far we've been talking mainly about Trump's promises and whether there would be any kind of administrative legal constraints to that. But let's now talk about the economics of this. So presumably one of the ideas here is that by removing illegal migrants, that will somehow improve the economic prospects of American citizens who are already here. Is that essentially your reading as well?
It is basically right. The campaign has said that US workers will celebrate mass deportation the first time around the Trump administration advocated cutting legal immigration to the United States by 43%. The specific law that they were advocating was called the RAISE Act. RAISE being an acronym intended to convey the idea that somehow eliminating 43% of all lawful immigration to the United States would raise the wages and employment prospects of Americans.
So a consistent theme in all of their statements is that the elimination of any kind of immigration with or without legal status automatically creates better job opportunities for Americans.
OK, now I'm going to go out on a limb here and say that you don't agree with that analysis of the effects of immigration. But can I ask you to go through some of the historical episodes where other governments have tried this sort of thing? Because this isn't the first time this idea has been had, right?
You're absolutely right that I don't agree, but it's like a meteorologist who's done modeling of the weather doesn't agree with somebody saying that hurricanes don't exist. Those statements by the campaign and by the prior administration are fabrications. They're not based on any research evidence that is prevalent among economists. We do have quite a lot of research evidence about real mass deportation episodes that have happened in the recent past.
and that evidence all points to an elimination of US jobs by mass deportation. Specifically, mass deportation under the Obama administration came in various forms, but perhaps the largest program was one called Secure Communities, which ended up deporting something like half a million people from the United States.
And the rollout of that program, County by County, across the United States has been rigorously evaluated by Chloe East of the University of Colorado and her co-authors. In the Journal of Labor Economics, they compare what happens to U.S. employment in counties where mass deportation under Obama had arrived to what happened to U.S. employment in similar or nearby counties.
that had not yet received a mass deportation, and they come to the very striking conclusion when trying to measure, well, how many US jobs were created by that mass deportation, it's a negative number. US employment was permanently destroyed in the counties that received mass deportation, and the way the numbers worked out, they estimate that 8.8 US jobs were permanently eliminated per 100 workers deported.
Okay, so that's a very controversial idea, right? Because I suppose macroeconomists tend to think about the level of employment in the economy as a function of demand, ultimately. And so the idea that someone would just be permanently out of a job because
someone else was sent home. That seems very surprising. And I mean, I guess there's also a question of whether that particular study can even find that effect. Permanent is a very long time, right? Whereas the Obama era deportations weren't that long ago. So presumably they don't have that many years of data even to test that result. What's the answer to those concerns?
The timescale they measure is four years, and there's no sign of a recovery of employment toward the end of those four years. So by permanent, I don't mean until the end of time. I'd simply mean that we are certainly not talking about people who were thrown out of their job. And three weeks later, they got another job. We are talking about a reduction in the pool of jobs available on the timescale of several years in the counties that were subjected to mass deportation.
And of course, I'm an economist who talks to the public and policymakers often, and sometimes people say, well, it's so difficult for people to grasp these economic models. I think this is incredibly easy to grasp. I mean, roughly half of the farm workers in the United States have no legal status to work in the United States. If you visit a farm where unauthorized workers are working, they are working
sometimes alongside, but sometimes in concert with people who are immigrants and have lawful status or many US citizens just doing different tasks. The unauthorized workers might be doing hand harvest and packing while citizens or authorized workers might be running equipment, doing the books. Everybody is collaborating to create the farm and ultimately make the salad that is eaten by consumers, but they are also creating each other's jobs by working together and specializing.
And that's something that I think anybody who's visited a restaurant or has observed workers on a dairy farm in rural areas or simply looks at a current economic situation in the United States can grasp. I don't think people need to read statistical studies to grasp it.
Okay, so is it possible that there is a distinction between the effects of removing people who are already kind of embedded within your economy and restricting new arrivals? I guess I'm thinking of some of the research that I've read. So there was a study by Bastan Fishback and Kanto of what happened around the time of the Great Depression.
They didn't find wage effects, but they do find some indication that new arrivals, at least in the short term, are tricky for existing residents to adapt to. Some of them drop to a part-time, some of them move out of the area. How should we think about that kind of evidence?
Yes, economically, there is absolutely no reason to think that the removal of immigrants from an economy would be simply the mirror image of barring their arrival. Those are completely different things. And specifically, the way an economist conceives of the economy is kind of like a machine that combines labor and capital to produce stuff.
which means that if the supply of labor suddenly goes up, capital might need time to adjust. If there's suddenly a lot more workers around, it might take time for entrepreneurs to create small construction firms to use that labor. It might take time for people to build factories to employ that labor. And in the meantime, there could be a glut of labor with respect to the capital that the economy has in the short term. And in principle, that could drive down wages. But if you're talking about an economy that
Stably, currently employs unauthorized workers, sometimes for decades. The entire dairy industry, half the farm workers in the United States, large sections of the child care, elder care industry, many other crucial industries in the United States, they've adjusted already to the presence of these workers and removing them would have immediate negative impacts for that reason.
Okay, my next question is whether you think there's any thinking about how to make it harder for companies to hire workers who are unthrised. So, you know, essentially making life more difficult for a legal migrants once they're in the country.
That has been criminalized in the United States for several decades and the enforcement of those laws has always been spotty. And the reason that it's always been spotty is that people directly involved in business understand that the immigration laws of the United States are not
geared toward fostering entrepreneurship and the survival of business in the United States, the dairy industry of the United States, the construction industry of the United States, the childcare industry of the United States depends on unauthorized labor. And the reason for that is that none of those industries nor several others that are critical to our everyday lives have access to lawful work visas. And that means that every time there is a breath of a crackdown on hiring a unauthorized workers from Washington,
local and national industry representatives come in and say, you are threatening our survival. You are directly attacking the labor that we require to survive. It is your job to come up with an immigration reform, the first in generations that would actually allow
us to hire the immigrants that we need, not on the black market, but through lawful channels in order to form new businesses, to expand existing businesses and create employment opportunities for Americans. And that's my interpretation of the political economy, of why that enforcement has always been limited. For that reason, the most effective way to reduce hiring
The already illegal hiring of unauthorized workers has been simply the elimination of their presence. As a farmer in North Carolina once told me directly, I'm quoting him, this is language that I wouldn't use myself. He said, people think we hire farm workers on H2A visas when we can't find Americans, but we haven't been able to find Americans in 20 years. We hire workers on H2A visas when we can't find illegals.
Again, his words. So it's really the physical elimination of them that has been in the past and currently the number one impediment on hiring. And I don't expect that to change. OK, well, look, I want to throw to a break now. But when we get back, I'm going to ask about where the politics and the economics of this meet. Why are Trump's promises resonating?
I'm James King, and in the new series of tectonic from the Financial Times, I'm going inside the miracle of modern chip manufacturing. It's the technology at the heart of the prosperity and security of nations. And there's a battle going on over who controls the chip-making industry. Listen to tectonic wherever you get your podcasts.
We are back from the break. So Michael, look, some of Trump's language about migrants has been really horrifying, right, dehumanizing, racist. But it seems that a lot of Americans like it, or at least they aren't turned off by it. And looking at the exit polls after the election, it seems that Republican voters in particular cared about this issue. What is your diagnosis for why this is doing so well?
You know, a constant across the US history is that people who have very real concerns about their lives get told by politicians who are political entrepreneurs that immigrants are their problem. During the long depression of the United States, starting in the 1870s, which remains the longest economic depression in history, bipartisan coalition of politicians were able to convince Americans that the 0.3% of the population that was Chinese at that time was the root of their
their very real concerns and sold them 83 years of Chinese exclusion as a result. This time around, it's very clear from the polling around the election that the chaos at the border is deeply unpopular and inflation has been deeply unpopular. And for somebody to stand up and directly address their concerns by saying, yeah, immigrants are the problem. I'm going to eliminate them so there won't be chaos at the border.
might be reassuring to people. It doesn't seem to matter that there are alternative and also popular policy options that would also address those exact same concerns. And yes, enforcement of the border is very popular among US voters. Also, remarkably, lawful channels for immigration to the United States are very popular among US voters.
Okay, but can I just butt in here? Because just thinking about the magnitudes here, right? I mean, looking back to say, you know, the early 2010s at the Southwest border, the US had something like 30 to 40,000.
unauthorized crossings a month. More recently, though, it's been more like 175,000. So, you know, chaos is the word that you use to describe it. And people say they want more little for migration, but is it really the case that they just want all of these people to come in legally? Or do they want different people to come in legally?
I mean, in theory, you could just put a few people up at the border and say, hey, do you want to come in legally? And I suspect that Americans wouldn't be thrilled with that idea either. So can this really be solved by more legal migration?
Not by itself, no. What has succeeded in the past and what I believe would be popular among US voters is a combination of enforcement with expanded lawful channels to channel people away from the desert, from the black market and into the light. That is what successfully reduced unauthorized immigration in the 1950s, when a vast expansion of lawful visas for Mexicans was combined with a crackdown in 1953, 1954.
The Trump campaign has been talking about the crackdown. They don't often talk about the accompanying vast expansion of 150% in lawful channels that came along with it. And there are many other examples in US history where those have worked. I just don't believe that the large majority of Americans
are fundamentally racist or define their immigration preferences around racism, what's deeply, deeply unpopular in both parties is chaos. Last December, there were 10,000 in admissible entries per day on average, and that's a situation that nobody wants. The root cause of that situation is the collision of
historic opportunities for mutual benefit across that border with very, very low unemployment on one side of that border. And immigration laws that haven't been revised in decades, that's the root cause of the situation, not the fact that immigrants are bad people or countries are sending their worst or all these nostrums that you hear from campaigns.
and wise politicians would look to US history for examples of effective policies that actually would address the concerns about chaos, and that recipe is carrot and stick together, a crackdown combined with a serious expansion of lawful channels. Okay, my last question is whether we have any idea of what all of this means for the US economy going forward?
The best estimates we have of what's going to happen over the next few years come from Warwick McKibben, who's at the Australian National University and is one of the world's leading authorities on modeling the international macroeconomy. Warwick McKibben studies two scenarios, one that's a low scenario for deportation of 1.3 million workers and then a high scenario that would be nearly all of them, 8.3 million.
And by 2028, Warren Kibben estimates a much smaller economy between negative 1.2% of GDP in the low deportation scenario and 7.4% less in GDP. Four years out in the high deportation scenario, he estimates that in the long term, the high deportation scenario will eliminate 0.6% of all US jobs for US workers.
And he also estimates that the low deportation scenario would increase inflation two years out in 2026 by 0.5%, and the high immigration scenario would increase inflation by 3.5%.
And those are very sensible numbers because as he points out, this is a classic supply shock where the ability of the economy to supply products by employing essential workers in specific tasks to create them will be reduced by more than demand. And that's going to drive up prices directly aggravating one of the main concerns that voters in this last election had.
Yeah, I mean, if in four years time the Republicans lose the next election because of massive inflationary search that they've imposed themselves, there will be some people saying, I told you so. Okay, well, look, I think we should end it there. We've covered a lot, the humanity and the economics of all of this. Michael, thank you so much for joining me. Thank you so much.
That is all for this week. You've been listening to the economic show with Samaya Keynes. If you enjoyed the show, then I would be eternally grateful if you could rate and review us wherever you listen. This episode was produced by Edith Russello with original music from Breantana and sound engineering by Joe Salcedo. It is edited by Brian Eistart, our executive producer's Manuela Sargosa. Shara Bromley is the FT's global head of audio. I'm Samaya Keynes, thanks for listening.
