Rise of Illegal Immigration was all in the forecast

The story was originally published in The Hill on January 19, 2018.

*****

The last few weeks have seen dueling headlines on illegal immigration. On Dec. 5, Forbes posted an article entitled “U.S. Border Patrol Reports Illegal Border Crossings At Record Low.” In it, the U.S. Customs and Border Protection (CBP) reported that “[i]n FY17, CBP recorded the lowest level of illegal cross-border migration on record, as measured by apprehensions along the border and inadmissible encounters at U.S. ports of entry.”

Victory, then? Can we relax, finally having defeated those pesky border jumpers?

Not so fast. Last week, the Washington Times  argued just the opposite:

The gains President Trump made early in his tenure have worn off. Nearly 40,000 illegal immigrants were nabbed attempting to sneak in at the border in November, which was up about 12 percent compared to October, and more than twice the monthly numbers from March and April, when Mr. Trump touted his early accomplishments.

Perhaps just as worrisome for officials is the rise in families traveling together, which surged 45 percent last month, and unaccompanied minors traveling without parents, which rose 26 percent in November.

What is going on? Are we being misled?

In fact, both news stories are factually correct. The Forbes article refers to fiscal year 2017, which ended in September. The annual data were heavily influenced by the few months immediately after President Trump took power, bringing the annual average down.

On the other hand, illegal immigration — as measured by apprehensions and inadmissibles — has been rising steadily since April. Just as the Washington Examiner notes, interdictions at the southwest border are now back at Obama era levels. Their data, however, refer to fiscal year 2018, while the Forbes data pertain to the earlier fiscal year. Both are true, but the Washington Times’ take is the one which rightly reflects the current state of affairs.

The numbers come as no surprise. The data are right in line with forecasts I made previously:

Expect a banner year for illegal immigration in 2018. With the ebbing of the Trump effect, crossings should return to typical norms, representing about 30,000 arrests per month. To that, add the crossers who deferred this year and will probably make an attempt next year, another 10,000 per month. These two factors alone would more than double the apprehension rates of 2017. 

As I note in my article, illegal immigration is likely to continue to rise. This is mostly good news, in the sense that illegal immigrants come for the work. As such, the rate of illegal immigration is a measure of the strength of the U.S. economy — and right now it’s quite strong. We expect the economy to be stronger still in 2018. Add to that the residual clean-up and reconstruction work from the fall’s hurricanes and the recent California fires, and illegal immigration will come in big in 2018. By the time the numbers settle, we may see the highest number of illegal crossings in a decade.

Expect the statistics to also record the greatest number of deaths in the desert in a long time. Enhanced enforcement coupled with a strong incentive to jump the border means that illegals will be taking ever bigger risks to get into the U.S., and they will increasingly die trying.

U.S. immigration policy remains dysfunctional, and next year we will see the worst of both worlds, both a surge in illegal immigration and a historically high percent of crossers dying in the attempt — perhaps the highest on record.

We can do better than that.

Expect Illegal Immigration Across the Mexican Border to Double Next Year

This piece was originally published in The Hill on October 27, 2017.

*****

President Trump has promised to reduce illegal immigration to the United States. More likely, however, 2018 will see one of the biggest waves of illegals from Central America since the start of the Great Recession.

The number of undocumented border crossings, which are unknown, can be inferred from arrest rates, which are well documented. Therefore, discussions of border jumping inevitably focus on apprehension rates, and we do here as well.

A new study by the Department of Homeland Security puts the border patrol’s interdiction rate at the Mexican border in the 55-80 percent range. The same study notes that smuggler fees to “coyotes,” who help migrants avoid the border patrol, appear to have increased by more than half since 2011, suggesting that law enforcement has indeed tightened.

On the other hand, arrests have remained range-bound around 500,000 annually since 2010, suggesting that the smuggling business has adapted. The statistics do not speak of an impenetrable border, but rather one that requires more planning and money than it used to.

For analytical purposes, a 55 percent interdiction rate seems about right. Just under half of those who try to cross the border, and are not deterred along the way, make it through. With that ratio assumed to be constant, we can draw conclusions about border crossings from apprehension rates.

Before the Great Recession, apprehensions at the U.S. border with Mexico often exceeded one million per year, at times by a considerable margin. With the collapse of the U.S. economy in 2008, however, the work prospects for migrants in the U.S. diminished, and arrests in the border zone fell by more than half, where they remained from 2010 until Trump took office.

As Trump took power, however, border apprehensions collapsed. Much of this was attributed to enhanced enforcement, which may have played a part. The numbers, however, suggest that intimidation from the president’s oversized personality played a decisive role. In fact, Trumpian intimidation took hold even before the elections.

Illegal crossings are seasonal. In a typical year, border crossings peak in the spring to early summer, as migrants cross for outdoors work in construction and agriculture. Crossings in the second half of the year are usually fewer, typically running only three-quarters the pace of the spring months. Last year was a clear exception to the pattern. As usual, the spring saw a peak in apprehensions, but rather than subsiding, the pace picked up afterwards and remained seasonally elevated until January — when Trump took office.

The pattern strongly suggests that Mexicans follow the news, too, and decided to bring forward their crossings in anticipation of stricter enforcement in the new administration. Thus, by Trump’s inauguration, border patrol had arrested perhaps 70,000 more crossers than seasonally expected. On the other hand, from Trump’s election to the end of this year, we project that 130,000 fewer crossers will be arrested than anticipated for 2017. In other words, much of the decline in 2017 can be explained by crossers advancing their border attempts into 2016.

Even so, Trump can personally take credit for deterring 110,000 putative crossers, of which perhaps 50,000 would have succeeded in entering the U.S.

The Trump effect, however, is not lasting. If not buttressed by action, the force of personality will fade. And so the data shows. Border apprehensions bottomed in April and have been climbing steadily since. They should be back at typical levels now.

And that’s not all. Expect a banner year for illegal immigration in 2018. With the ebbing of the Trump effect, crossings should return to typical norms, representing about 30,000 arrests per month. To that, add the crossers who deferred this year and will probably make an attempt next year, another 10,000 per month.These two factors alone would more than double the apprehension rates of 2017.

These trends will be exacerbated by a handful of critical economic developments. First, hurricanes Harvey and Irma and the recent California fires will require up to 250,000 man years for clean-up and reconstruction. And this comes at a time when the National Association of Housing Builders reports that an unprecedented 82 percent of construction firms are anticipating labor shortages.

Further, the restrained pace of crossings this year has meant that farm workers are in short supply in California, with wages of up to $16 per hournow offered, but few U.S. citizens interested in the work. For migrant workers, the prospect is all but irresistible. In Mexico, unskilled labor will earn $2.50 per hour, so an increase in U.S. wages from $10 to $15 per hour is the equivalent of increasing net U.S. wages from three times that of Mexico, to five times that of Mexico — which provides both the funding and incentive for elaborate and creative means to circumvent the wall and border patrol.

The Trump administration can unquestionably claim credit for reducing illegal immigration this year, which will come in at half the level of 2016. But the victory will be fleeting, and by next year, the border zone will return to business as usual, and then some. In 2018, the U.S. promises voracious demand for unskilled labor, and a willingness to pay a hefty premium to get it. As ever, undocumented migrants will respond to the call, by whatever means necessary to circumvent border controls.

Enforcement in a Market-based Visa System

In an immigration system, there are essentially two points of enforcement: the border and employers.  

The current system focuses on the border, as eight million undocumented migrants have managed to get over the border and find employment.  Conservatives want a crack-down on employers.  However, industries like agriculture, food processing, construction and hospitality services depend intrinsically on migrant labor, and given a choice between bankruptcy and hiring undocumented labor, employers will go with the latter every time.  By default, therefore, border enforcement is the central focus of Trump administration policy.

A market-based visa (MBV) system, by contrast, relies on employer enforcement.  This is feasible if

1. The number of visas materially covers market demand (say, +/- 7% of actual), and
2. Employers can access an unlimited number of background-checked workers on short notice, subject to a visa price set by the market

Under these conditions, employers--and the migrants themselves--will enforce the system.  

Let's demonstrate by analogy.  The US does, in fact, have a sector with thousands of jobs openings, good pay and yet minimal black market labor.  That sector?  Trucking.  Today, there are 100,000 open trucker jobs in the US paying $45-75k, but with minimal black market activity.  Virtually all the drivers in the US hold commercial driving licenses.  Why?

The answer is simple.  A driver's license is comparatively easy to get.  Many trucking companies would even pay a driver to get one.  On the other hand, if an applicant cannot get a license, he is almost certainly not fit to drive a truck.  That is obviously an important consideration for, say, FedEx, both because they do not want their trucks in accidents and because they rightly fear liability.   Thus, an individual needs a commercial license to drive a truck not because of heavy-handed government enforcement, but because the license actually conveys information to the employer, and because it represents a reputational and liability risk.  In that sense, the system is self-enforcing.

If there are enough work visas to cover the market, then the same logic applies to migrant labor.  If a migrant who is not a criminal can purchase a visa anytime, anywhere, then the only migrants ineligible for visas are criminals.  Employers do not want to hire criminals.  Why would an employer do that, when a million non-criminal Mexicans would willingly take the work on a day's notice?  And imagine that an employer hired a criminal -- someone he knew could not obtain a work visa (which he would, using a smartphone-based system) -- and that migrant committed a serious crime.  That could constitute aiding and abetting, with unlimited legal liability.  Under the circumstances, an employer would have a substantial incentive to reject an applicant without a visa, just as FedEx will not hire a driver without an appropriate license.

Nor would legal migrants permit it.  A legal migrant who just paid $4,000 for a visa would actively resist their employer hiring people off the books.  So in this world, the migrant workers themselves will be a key driver of enforcement.  For both these reasons, dangerous criminals will be frozen out of the legal job market. 

And this can be achieved while leaving the border essentially open.  Back in Mexico, experienced migrants will say, "Well, the US system is terrific.  But it's expensive to pay the fee and hang out there if you're not working.  So you want to get work lined up as soon as possible, and you'll do really well if you're working ten hours a day, six days a week, because the visa fee is fixed either way.  If you're not working, though, it's best to come back to Mexico.  It's cheaper anyway, you can see all the jobs on offer and apply over the internet, and you can go back anytime you want.  But whatever you do, don't get caught without a visa.  Employers will not hire you without one, because there are a million legal migrants lining up to take your job.  And if you're caught by the authorities, you are cooked.  You won't be able to work again in the US for years.  Moreover, if the other migrants find out you don't have a visa, they will inform on both you and the employer to the authorities.  They paid good money for their visa, and they expect you do the same.  So, just follow the procedures.  Go through the bureaucratic background check, and become visa-eligible.  After that, work the internet and your circle of friends and family and jump in legally when you get an opening.  If you work long, smart and hard, you'll make good money."

That's how enforcement works in a market-based system.