How Diabolical is Unz's Proposal? By Bryan Caplan

Ron Unz wants to raise the minimum wage to discourage illegal immigration. The mechanism: The minimum wage raises unemployment for low-skilled workers, and illegal immigrants are very low-skilled. His words:

In effect, a much higher minimum wage serves to remove the lowest rungs

in the employment ladder, thus preventing newly arrived immigrants from

gaining their initial foothold in the economy.

When I told Unz that I considered his plan “diabolical,” he chuckled that he took my assessment as a compliment.

To be “diabolical” is to be cleverly evil. But Unz’s critics often deny that he’s even clever. If employers are willing to break immigration laws, why does Unz think they won’t break minimum wage laws as well? The truth, though, is that Unz anticipated this objection:

The enforcement of these wage provisions would be quite easy compared

with the complex web of current government requirements and

restrictions. It is possible for business owners to claim they were

“fooled” by obviously fraudulent legal documents or that they somehow

neglected to run the confusing electronic background checks on their new

temporary dishwasher. But it is very difficult for anyone to claim he

“forgot” to pay his workers the legally mandated minimum wage.

Furthermore, the former situation constitutes something of a “victimless

crime” and usually arouses considerable sympathy among immigrant-rights

advocates and within ethnic communities; but the latter would

universally be seen as the case of a greedy boss who refused to pay his

workers the money they were legally due and would attract no sympathy

from the media, the police, juries, or anyone else. Very stiff penalties, including mandatory prison terms, could assure

near absolute compliance. Virtually no employer would be foolish enough

to attempt to save a few hundred dollars a month in wages paid at the

risk of a five-year prison sentence, especially since the workers he was

cheating would immediately acquire enormous bargaining leverage over

him by threatening to report his behavior to the police.

Yes, Unz overstates. People who employ a solitary illegal nanny, housekeeper, or gardener won’t fret about the minimum wage. Unless enforcement norms drastically change, your neighbors will effectively remain above the law. But Unz’s proposal would effectively shut illegal workers out the legal labor market – and that’s where most of the jobs are.

Still, there is a way to make Unz’s proposal even more diabolical. I hesitate to reveal it, but I seriously doubt the nativists will listen. The heart of darkness: Give a green card to any illegal immigrant who testifies against his employer for labor law violations. You solve for the tragic equilibrium.