Posted by
Conservatarian on Tuesday, September 26, 2006 12:25:17 PM
Illegal immigration augments the supply of labor, and many Chicago school economists concede that supply generates demand, i.e. illegal workers who work for low wages indirectly create the low wage jobs they take. Low wages give entrepreneurs incentives to expand their business, create jobs and provide services at reduced costs. For that reason minimum wage is killing America's native indigent - if unfettered the price of their labor would drop to a natural level and they could compete economically with illegals, who would then lose some incentive to come to this country.
In lieu of finding jobs in the labor sector (because of an artificially high minimum wage) the poor either don't work at all (thanks to the coddling effect of welfare) or they go to college (which they afford through government subsidies). Like dollars, an expanded pool of college diplomas naturally loses value at the individual unit level, and matters are not at all helped by diminishing standards of curriculum or the hundreds of thousands of athletic scholarships handed out every year that produce slews of "student-athletes" not fit for either the NFL or the work force.
The jobs available to the average liberal arts graduate are usually either private sector bureaucratic pencil pushing or lower tier service sector positions (retail, administrative, etc.) Because of the deflated value of the requisite skills and education for these positions, they become lower paying, enticing some of these same graduates to pursue even more education. Meanwhile, government is unintentionally willing to absorb the remainder of college grads into its behemoth bureaucracy, eliminating the incentive for individuals to pursue alternatives to higher education and restricting market forces that would have shrunk the labor pool for the private service sector and driven wages upwards. Ultimately, the population remains as stratified into economic classes as before, but now the lower middle class requires a college diploma to remain so, and automatically incurs a serious debt before they even start out in life.