New Report: TPP Would Depress Black, Hispanic Wages the Most Dramatically
Published on September 12th, 2016
By Joe Guzzardi
September 12, 2016
For decades, advocates for lower immigration levels have argued that adding more workers to the labor pool depresses wages for blacks and Hispanics, many of whom are already at the lower end of the economic spectrum.
Legal immigrants, an average of one million annually each year for the last two decade, receive employment authorization documents, and are permitted to work immediately. Illegal immigrants work in the underground economy, deny citizens jobs in lesser-skilled occupations, depress wages, but are a boon to employers who don’t pay taxes on their cash wages. Nevertheless, the Congressional Black Caucus and the Congressional Hispanic Caucus consistently and unanimously vote for more immigration, and to legalize unlawful immigrants.
Now a new Economic Policy Institute study confirms that the latest White House push for more legal immigration, the Trans-Pacific Partnership, would if passed further depress the incomes of struggling Americans, mostly non-college educated black and Hispanics whose earnings lag those of whites. TPP includes 12 Asian-rim nations six of which are the low-wage paying, developing nations of Malaysia, Mexico, Peru, Vietnam, Chile, and Brunei. Human rights groups have accused three of those six, Malaysia, Vietnam and Brunei, of using slave labor.
In its analysis EPI, a liberal-leaning policy organization based in Washington, D.C., found that increased imports of goods from low-wage, under-developed countries, which nearly tripled from 2.9 percent of GDP in 1989 to 8.4 percent in 2011, reduced the wages of the typical non-college educated worker in 2011 by “5.5 percent, or by roughly $1,800, for a full-time, full year worker earning the average wage for workers without a four-year college degree.”
EPI reports that overall, the nation has nearly 100 million American workers without a four-year degree who make up slightly less than 70 percent of the workforce. But 75 percent of black workers and more than 85 percent of Hispanic workers do not have a four-year degree. The wage losses suffered by this group amount to roughly a full percentage point of GDP – about $180 billion per year.
TPP’s greatest threat is that would admit what would be essentially an unlimited number of guest workers in every employment category including minimum wage positions. Although the Obama administration insists that immigration is not a TPP variable, history proves otherwise. The 2005 U.S.-Australia trade agreement created a new visa category for Australian labor that admits thousands of new workers each year. A subsequent trade pact with South Korea included a provision to allow Korean international employees to enter on L visas designed for intracompany transferees to work in the U.S. for five years instead of the original three.
Americans oppose TPP, and contend that it’s a cheap labor vehicle. And although President Bill Clinton signed the North American Free Trade Agreement more than 20 years ago, Americans still have a vivid recollection of his broken promises. Clinton vowed that NAFTA would generate 200,000 jobs. Instead of creating employment, American job loss directly related to NAFTA reached nearly 700,000, according to an earlier EPI report.
Obama has pressed Congress to pass TPP during the upcoming lame-duck session.
Congressional black and Hispanic leaders should read and digest the EPI report, and, in their constituents’ best interests, vote no on TPP.
A Californians for Population Stabilization Senior Writing Fellow, Joe Guzzardi can be reached at [email protected] and followed on Twitter @joeguzzardi19