American Identity, Immigration, and the Melting Pot Debate

Introduction: Immigration and the American Economy

What does it mean to be "American" in a country as diverse as the United States? It has been decades since the Immigration Act of 1924 (Johnson-Reed Act) was passed. The law established a quota system that slowed the rate at which new migrants entered the United States. Immigration had already brought more than 23.5 million people into the country. Some argue that the Johnson-Reed Act disadvantaged certain regions of the world while giving preference to others, though not explicitly. Among the regions critics consider disadvantaged are Southern and Eastern Europe. Critics also contend that the Johnson-Reed Act was one reason Asian migration into the United States slowed following World War II (Kraut, 2014, p. 707).

The United States holds a reputation as a land of opportunity for nearly all its residents. There are significant avenues for upward mobility, allowing people born into lower socioeconomic levels to change their fortunes and rise on the socioeconomic ladder. Nonetheless, critics of immigration argue that it disadvantages poorer Americans by driving down wages in jobs that would otherwise give the poor a springboard out of poverty. Unskilled immigrants are often willing to accept lower wages. These fears have dominated political and economic debates for several decades (Ran & Fabio, 2006).

A review of contemporary and historical evidence yields several interesting observations. First, over time, the composition of immigration has shifted. In the past, the selection of migrants was mixed, with both skilled and unskilled workers receiving immigration permits. Today, there is far greater emphasis on skills, which have become the most observable characteristic used by immigration authorities (Abramitzky, Platt & Katherine, 2013). This shift can be explained by several factors, including rising income inequality in the United States and the desire of officials to preserve wage opportunities for people at the lower end of the socioeconomic scale. Additionally, from the perspective of self-selection, the process of migrating to the United States is costly, meaning that skilled workers with sufficient resources are the most likely to undertake it. This reality aligns closely with the Roy model of self-selection (Abramitzky & Boustan, 2017).

The second observation is that the socioeconomic situation of immigrants does not always reflect the notion of the "American Dream." Both historically and today, the popular argument holds that migrants arrive with little and gradually rise to catch up with other Americans. The reality, however, is that immigrants and native-born workers experience nearly the same rate of wage growth. Because unskilled migrants start at the bottom, a standard rate of wage growth is insufficient for them to catch up with other Americans within a single generation.

This is especially true today, though it was less the case in the pre-1900 era. During that earlier period, migrants and natives often held similar jobs and experienced comparable wage growth. Today, high-paying positions require advanced specialized skills that may be difficult or unaffordable for immigrants to acquire. Another relevant factor is that a typical immigrant before 1900 came from Europe, which was poorer than the United States but not dramatically so. There were considerable similarities between the jobs available, the skills required, and the technology used in Europe and America at that time. Migrants therefore had a great deal in common with most American workers and could secure comparable employment. The relative heterogeneity of skills meant that immigrants advanced at nearly the same rate as natives and could realistically attain the "American Dream" within their own lifetime (Ran, Platt & Katherine, 2013).

The third observation is that while immigrants entering the workforce may reduce wages for some native workers, there is no evidence to support the claim that immigration has a net negative effect on the national economy. As is common in most economic systems, immigration creates both winners and losers, but the net effect on the U.S. economy is positive. Even in cases where immigrants contribute to lower wages, gateway cities often attract new capital investment in the form of factories and other businesses seeking to take advantage of lower labor costs (Abramitzky & Boustan, 2017, p. 2).