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Question: How do "free market" proponents support the free flow of (financial) capital across borders but not the free flow of (human) capital across borders?

Question: How do "free market" proponents support the free flow of (financial) capital across borders but not the free flow of (human) capital across borders? I appreciate any insight/references regarding this topic. EDIT: I know this is a loaded question but I think it hits to the heart of this immigration issue. I trust there are many smart (and civil) members of this community from across the politecon spectrum who could provide more insight on this or related debates.

icebraining 12y ago
That's a loaded question :) most of what I read by libertarians is supportive of free immigration, e.g. http://bleedingheartlibertarians.com/tag/immigration/ http://bleedingheartlibertarians.com/tag/immigration/
cottonseed 12y ago
This is economic, not political, but there is a good Planet Money on the economic perspectives on immigration: http://www.npr.org/blogs/money/2014/04/02/298383246/episode-436-if-economists-controlled-the-borders http://www.npr.org/blogs/money/2014/04/02/298383246/episode-...
x1798DE 12y ago
What free market proponents are in favor of free trade but against free immigration? In my experience part of the libertarian ethos is about opening up immigration. The only way I can imagine a free-market proponent who is in favor of free trade holding consistent beliefs which are also against immigration is if they are for immigration from a trade perspective, but against it on some other grounds such as national defense or national identity. You can imagine that the justification for at least the national defense reasoning is that if you let in a lot of people, you'll end up allowing some sort of fifth column or something to develop in the heart of the nation. Frankly, I don't buy any of the objections I've seen to basically unlimited immigration, but there are at least some that are intellectually consistent with a free-market position. You can find a laundry list of anti-immigration positions (many of which are at least intellectually consistent with a free market philosophy), alongside their specific refutations over at http://openborders.info http://openborders.info
- chishaku 12y ago
  Thanks, http://openborders.info http://openborders.info looks like a great starting point.
a8da6b0c91d 12y ago
A nation is in a sense an extended family. Members feel some duty to look out for each other beyond simple self interest. This breaks down when too many foreigners crash the party. They don't have skin in the game or ties to the soil. They will leave at the first sign of serious trouble. They will be less inclined to think about the long term.
rwallace 12y ago
As a pragmatic libertarian, I'm fine with the free flow of capital across borders, but people are not mere capital. We are agents with opinions about how the world should be, who reserve the right under certain circumstances to back up those opinions with force. Unless you're willing to have a nightmare police state like North Korea, you can't maintain a civilized society by fiat. You have to have consensus among the governed. Hence nationalism: the principle that political borders should coincide with cultural ones. If you break that, if you try to impose a single state on people of different cultures who have different ideas about how things should be, you end up with, as has been demonstrated over and over again, misery at best and genocide at worst. How many times does history have to teach us that lesson before we learn it? The real solution is to move on from this 19th-century idea that having a job has to mean locating your body in physical proximity to your employer. The round-trip delay for a lightspeed signal across the Atlantic is less than a tenth of a second. Being located in Belfast should not be an obstacle to working for an American company.
spikels 12y ago
While personally I am generally for both free markets and open borders I think most people make these judgements based on their understanding of their own self-interest - as they probably should. Depending on your specific situation you can easily be for both of these seemingly contradictory positions. Imagine you are an electrician working on a foreign funded construction project. Your pay comes from foreign investment while your wage rate is boosted by reduced competition from foreign workers. Or imagine you are a politician who is supported by multinational manufacturers and investors but know immigrants don't tend to vote for you. I bet you will be pro-free market and anti-immigration (and your opponents will hold the opposite views). Or imagine you run a US based tech business with international ambitions. You will likely be for free international investment and more immigration for high tech workers. I find it much more useful to try to understand people's incentives than their professed philosophy if you want to explain their behavior. While people hold all kinds of views about things that don't directly affect them. Philosophy often gets left behind when it's implications start to actually matter to them.
- MarkMc 12y ago
  > I find it much more useful to try to understand people's incentives than their professed philosophy if you want to explain their behavior. Sure, but if you want to change their behavior then it helps to be able to show that it contradicts their stated beliefs.
MarkMc 12y ago
Good question. Here's my attempt at a 'free market' answer: When you import capital, the cost of that capital is borne by a single individual. When you import labour, the cost is spread amongst society. Consider a US farmer who sells part of his farm for UK pounds. The price is paid by the farmer and no-one else. But now imagine the farmer wants to import a rural Indian laborer to work on his farm. The farmer pays wages but other US citizens must either (a) provide hospitals, schools, and roads for the labourer; or (b) bear the costs of letting the laborer live in abject poverty (eg. slums, higher crime rates, environmental damage). In true 'free market' fashion US citizens may decide that those costs outweigh the benefit of slightly cheaper farm produce, and so the labourer is denied entry into the US. This is not a restriction on free trade but simply the result of supply not matching demand. Perhaps a purely free market approach would be to charge an 'immigrant fee' which equals the present value of (a) the expected cost of providing social services and infrastructure to the immigrant; less (b) the total expected tax receipts from the immigrant. An Indian labourer might not be able to pay the fee, but a computer programmer from the UK probably could. In fact, if the expected tax receipts were larger than the expected costs to society, the US might pay the programmer to immigrate!
coldtea 12y ago
>Question: How do "free market" proponents support the free flow of (financial) capital across borders but not the free flow of (human) capital across borders? Lots of free market proponets, especially those in the higher echelons, are also full in favor of immigration. For them it means the availability of cheaper, less demanding, employees willing to work for worse working conditions for them, without having to go to China to find them. I think that proponents of the "free market" come in two flavors: poor idealists that really believe in the thing, and rich people who are its greatest advocates only to use the notion as they see fit to influence policy in their favor. For the latter group, it's all about their bottom line. If they have an oligopoly, they want laws and regulations to block the entrance to the market to newcomers. If they produce something that has competition from abroad they ask for subsidies, tarrifs and bailouts. If they want to take on something that's free or communal and make a business out of it, they want "deregulation" and "freer market". If they make their money out of human capital, either skilled or unskilled, they want more immigrants and less labor protections, to have more access to cheaper workers.

icebraining 12y ago

That's a loaded question :) most of what I read by libertarians is supportive of free immigration, e.g. http://bleedingheartlibertarians.com/tag/immigration/ http://bleedingheartlibertarians.com/tag/immigration/

cottonseed 12y ago

This is economic, not political, but there is a good Planet Money on the economic perspectives on immigration: http://www.npr.org/blogs/money/2014/04/02/298383246/episode-436-if-economists-controlled-the-borders http://www.npr.org/blogs/money/2014/04/02/298383246/episode-...

x1798DE 12y ago

What free market proponents are in favor of free trade but against free immigration? In my experience part of the libertarian ethos is about opening up immigration. The only way I can imagine a free-market proponent who is in favor of free trade holding consistent beliefs which are also against immigration is if they are for immigration from a trade perspective, but against it on some other grounds such as national defense or national identity. You can imagine that the justification for at least the national defense reasoning is that if you let in a lot of people, you'll end up allowing some sort of fifth column or something to develop in the heart of the nation. Frankly, I don't buy any of the objections I've seen to basically unlimited immigration, but there are at least some that are intellectually consistent with a free-market position. You can find a laundry list of anti-immigration positions (many of which are at least intellectually consistent with a free market philosophy), alongside their specific refutations over at http://openborders.info http://openborders.info

chishaku 12y ago
Thanks, http://openborders.info http://openborders.info looks like a great starting point.

a8da6b0c91d 12y ago

A nation is in a sense an extended family. Members feel some duty to look out for each other beyond simple self interest. This breaks down when too many foreigners crash the party. They don't have skin in the game or ties to the soil. They will leave at the first sign of serious trouble. They will be less inclined to think about the long term.

rwallace 12y ago

As a pragmatic libertarian, I'm fine with the free flow of capital across borders, but people are not mere capital. We are agents with opinions about how the world should be, who reserve the right under certain circumstances to back up those opinions with force. Unless you're willing to have a nightmare police state like North Korea, you can't maintain a civilized society by fiat. You have to have consensus among the governed. Hence nationalism: the principle that political borders should coincide with cultural ones. If you break that, if you try to impose a single state on people of different cultures who have different ideas about how things should be, you end up with, as has been demonstrated over and over again, misery at best and genocide at worst. How many times does history have to teach us that lesson before we learn it? The real solution is to move on from this 19th-century idea that having a job has to mean locating your body in physical proximity to your employer. The round-trip delay for a lightspeed signal across the Atlantic is less than a tenth of a second. Being located in Belfast should not be an obstacle to working for an American company.

spikels 12y ago

While personally I am generally for both free markets and open borders I think most people make these judgements based on their understanding of their own self-interest - as they probably should. Depending on your specific situation you can easily be for both of these seemingly contradictory positions. Imagine you are an electrician working on a foreign funded construction project. Your pay comes from foreign investment while your wage rate is boosted by reduced competition from foreign workers. Or imagine you are a politician who is supported by multinational manufacturers and investors but know immigrants don't tend to vote for you. I bet you will be pro-free market and anti-immigration (and your opponents will hold the opposite views). Or imagine you run a US based tech business with international ambitions. You will likely be for free international investment and more immigration for high tech workers. I find it much more useful to try to understand people's incentives than their professed philosophy if you want to explain their behavior. While people hold all kinds of views about things that don't directly affect them. Philosophy often gets left behind when it's implications start to actually matter to them.

MarkMc 12y ago
> I find it much more useful to try to understand people's incentives than their professed philosophy if you want to explain their behavior. Sure, but if you want to change their behavior then it helps to be able to show that it contradicts their stated beliefs.

MarkMc 12y ago

Good question. Here's my attempt at a 'free market' answer: When you import capital, the cost of that capital is borne by a single individual. When you import labour, the cost is spread amongst society. Consider a US farmer who sells part of his farm for UK pounds. The price is paid by the farmer and no-one else. But now imagine the farmer wants to import a rural Indian laborer to work on his farm. The farmer pays wages but other US citizens must either (a) provide hospitals, schools, and roads for the labourer; or (b) bear the costs of letting the laborer live in abject poverty (eg. slums, higher crime rates, environmental damage). In true 'free market' fashion US citizens may decide that those costs outweigh the benefit of slightly cheaper farm produce, and so the labourer is denied entry into the US. This is not a restriction on free trade but simply the result of supply not matching demand. Perhaps a purely free market approach would be to charge an 'immigrant fee' which equals the present value of (a) the expected cost of providing social services and infrastructure to the immigrant; less (b) the total expected tax receipts from the immigrant. An Indian labourer might not be able to pay the fee, but a computer programmer from the UK probably could. In fact, if the expected tax receipts were larger than the expected costs to society, the US might pay the programmer to immigrate!

coldtea 12y ago

>Question: How do "free market" proponents support the free flow of (financial) capital across borders but not the free flow of (human) capital across borders? Lots of free market proponets, especially those in the higher echelons, are also full in favor of immigration. For them it means the availability of cheaper, less demanding, employees willing to work for worse working conditions for them, without having to go to China to find them. I think that proponents of the "free market" come in two flavors: poor idealists that really believe in the thing, and rich people who are its greatest advocates only to use the notion as they see fit to influence policy in their favor. For the latter group, it's all about their bottom line. If they have an oligopoly, they want laws and regulations to block the entrance to the market to newcomers. If they produce something that has competition from abroad they ask for subsidies, tarrifs and bailouts. If they want to take on something that's free or communal and make a business out of it, they want "deregulation" and "freer market". If they make their money out of human capital, either skilled or unskilled, they want more immigrants and less labor protections, to have more access to cheaper workers.