A Bigger Pie

I think it was Mark Twain who said “It isn’t what you don’t know that hurts you–it’s what you know for certain that just ain’t so.”

Political debate these days is awash with “facts” that “just ain’t so.” One of those “facts” is that immigrants take jobs from Americans, and that raising the number of foreign-born people we allow to enter the country legally each year would worsen unemployment. A recent study by the Fiscal Policy Institute tells a very different story.

The Institute looked at incorporation figures and determined that immigrants own 18% of all small businesses in the U.S. In other words, more than one in six small businesses is owned by an immigrant. Those businesses employ an estimated 4.7 million workers, and generate some $776 billion dollars in revenue.

That immigrants gravitate to ownership shouldn’t surprise us. You have to be a risk taker to leave the place of your birth and move to a foreign country. Anti-immigrant attitudes make it more difficult for educated and skilled immigrants to find management and professional positions with American-owned firms. So, disproportionately, immigrants start their own small businesses, and small businesses are far and away the largest generators of employment. Small businesses–not massive corporations–are the real “job creators.”

The notion that immigration slows job growth is rooted in a “zero sum” worldview, the belief that the economy is like a pie. In that view, there is a fixed amount of pie, and if you get a bigger slice, mine will be smaller–if an immigrant gets a job, that’s one job fewer for Americans.

The virtue of capitalism is that it encourages people to bake more pie. And that is precisely what immigrants are doing.

Somehow, I doubt that this evidence will make much difference to those who want to raise the gangplank and keep those “others” out. What we know that “just ain’t so” keeps getting in the way of acting in our own best interests.


  1. I think the anger to illegals is misplaced. Where’s the anger at the corporations that entice people to work for them without the proper legal paperwork? Nobody, and I mean nobody would come here if that small business or corporation wasn’t willing to look the other way and pay them. This ‘shoot them at the border’ thinking is out of control and we need to change the message. Those ‘illegals’ are all humans; someone’s brother, sister, mother or father.

    I’m married to someone that came to this country legally and the immigration system is broken. Our immigration policy needs to be updated and streamlined but Congress refuses to act humanely therefore President Obama filed that executive order. If anyone wants to know what it’s like to bring your spouse to this country, I can tell you exactly what it took. It’s ugly, expensive, takes far too long and it only creates fear and loathing of our system. I can also tell what’s it like to move to Germany as an EU spouse and how freaking easy and humane it was to do that there. We need to take a lesson or two from ‘other’ countries to see how they manage immigration and implement some of those processes here.

    Anyone that says that building a fence or shooting people at the border are sick and we need to stop that kind of posturing once and for all. It pains me deeply to hear it because I care deeply enough about someone that wasn’t born in this country.

  2. We certainly do have a pie of limited size. We wouldn’t be borrowing over $4B each business day if we didn’t. “Anti-immigrant attitude” would be somewhat negated if part of spending money we don’t have didn’t also include benefits for those here illegally.

    I’m onboard completely for reduced defense spending based on reforming procurement and putting a stop to sending troops to boondoggles like Iraq. However, with defense only 20%+ of the budget and entitlements 60%+, the luxury of throwing money at illegal immigration beyond temporary assistance isn’t affordable.

  3. A few decades ago while in grad school I took a course called Projective Geometry. That course and a course called Elementary Quantum Mechanics served notice on me that I needed to move out of the realm of chemistry, physics, and mathematics post haste – there will never be a Small Boson particle. Projective geometry involves many things, most of which are still over my head, but one thing I recall was how inapplicable most of the postulates and theorems used in Euclidean geometry were – like there were parallel and perpendicular planes with properties entirely unrelated to each other.

    When I read a comment here that sought to dismiss Sheila’s bigger job pie point with an axiom that the pie cannot be expanding because there is an increase in the national debt, I thought for a moment that I was having one of those dreams where I missed the final exam in projective geometry.

    According to the Bureau of Labor Statistices, we have experienced 22 months of net gain in jobs in this country since September 2010. We have added a net of 3,360,000 jobs during those 22 months. Given that public sector jobs have declined on a monthly basis during that period, all of these new jobs are private sector jobs. Seems to me the proof of the expanding-pie postulate is in the pudding.

    So help me understand. What possible relevance to the expanding-jobs-pie postulate does the size of the national debt have?

  4. I associate paying for government with tax revenue. I associate tax revenue with successful business and employment (jobs). If we’re improving in jobs (I can’t and won’t dispute that for the moment)- that is indeed good news. If this improvement is enough in tax revenue to pay for illegal immigration benefits, then for those that want that- fabulous.

    However, if America is indeed improving economically (with jobs as part of that), I would think we could agree that we don’t yet have the improvement we need, whether measured by job creation, unemployment rate, business starts, or the amount borrowed from other countries, to satisfy benefits: social security, medicaid, medicare, etc.

    Besides deciding to look the other way for young illegal immigrants of late, the present administration has also expanded food stamp roles, and chosen to lessen an obligation to find a job associated with welfare.

    Given the large crowds responding to the plans of Romney and Ryan, I don’t appear to be the only one with continuing economic concerns- whether I’m properly or improperly associating with a pie, cake, or whatever.

    If I’m mistaken and improving jobs numbers reflect a tsunami of tax revenue that will pay for all to which we’re federally committed- Hallelujah and I’ll buy the round.

  5. I’m pleased that you actually acknowledged “legal” immigration in the first paragraph. Assuming you’re finally attempting to differentiate between legal and illegal immigration.

    Bob Small, just because someone is here and working doesn’t mean they’re also not a burden on the government. Oftentimes legal, and illegal, immigrants rely on the underground economy, and the rest of us end up paying the difference. If we had an approach where we actively sought after higher earners I could understand, in fact square or cube, your theory. Unfortunately that’s not the case.

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