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Jobs Americans Won't Do: Voodoo Economics from the White House.
National Review Online ^ | January 07, 2004 | Mark Krikorian

Posted on 01/07/2004 10:51:13 AM PST by xsysmgr

Today the president announces his plan for a vast new guestworker system, which would grant amnesty to millions of illegals currently in the United States, as well as import millions of new workers from abroad. (The president will also call for an increase in permanent legal immigration beyond the current rate of one million a year.)

I make the argument against amnesty in the cover story for the upcoming print version of NR, but here I want to look at the basic assumption underlying the whole Bush plan: that there are jobs Americans simply won't do, so that the importation of foreigners is essential. Whether these foreign workers are illegal aliens, guestworkers, or permanent legal immigrants is a detail to be worked out by us, the argument goes, but our need for them is unchanged.

Even many opponents of the proposed Bush Amnesty assume this to be true, leading them to propose new and improved guestworker programs, with provisions for stricter controls against permanent settlement, greater incentives to return, tighter enforcement against unscrupulous employers, etc.

As well-meaning as such efforts may be, the basic assumption is false — there is simply no economic reason to import foreign workers.

If the supply of foreign workers were to dry up (say, through actually enforcing the immigration law, for starters), employers would respond to this new, tighter, labor market in two ways. One, they would offer higher wages, increased benefits, and improved working conditions, so as to recruit and retain people from the remaining pool of workers. At the same time, the same employers would look for ways to eliminate some of the jobs they now are having trouble filling. The result would be a new equilibrium, with blue-collar workers making somewhat better money, but each one of those workers being more productive.

Many people fear the first part of such a response, claiming that prices for fruits and vegetables would skyrocket, fueling inflation. But since all unskilled labor — from Americans and foreigners, in all industries — accounts for such a small part of our economy, perhaps four percent of GDP, we can tighten the labor market without any fear of sparking meaningful inflation. Agricultural economist Philip Martin has pointed out that labor accounts for only about ten percent of the retail price of a head of lettuce, for instance, so even doubling the wages of pickers would have little noticeable effect on consumers.

But it's the second part of the response to a tighter labor market that people just don't get. By holding down natural wage growth in labor-intensive industries, immigration serves as a subsidy for low-wage, low-productivity ways of doing business, retarding technological progress and productivity growth.

That this is so should not be a surprise. Julian Simon, in his 1981 classic, The Ultimate Resource, wrote about how scarcity leads to innovation:

It is important to recognize that discoveries of improved methods and of substitute products are not just luck. They happen in response to "scarcity" — an increase in cost. Even after a discovery is made, there is a good chance that it will not be put into operation until there is need for it due to rising cost. This point is important: Scarcity and technological advance are not two unrelated competitors in a race; rather, each influences the other.

As it is for copper or oil, this fact is true also for labor; as wages have risen over time, innovators have devised ways of substituting capital for labor, increasing productivity to the benefit of all. The converse, of course, is also true; the artificial superabundance of a resource will tend to remove much of the incentive for innovation.

Stagnating innovation caused by excessive immigration is perhaps most apparent in the most immigrant-dependent activity — the harvest of fresh fruit and vegetables. The period from 1960 to 1975 (roughly from the end of the "Bracero" program, which imported Mexican farmworkers, to the beginning of the mass illegal immigration we are still experiencing today) was a period of considerable agricultural mechanization. But a continuing increase in the acreage and number of crops harvested mechanically did not materialize as expected, in large part because the supply of workers remained artificially large due to the growing illegal immigration we were politically unwilling to stop.

An example of a productivity improvement that "will not be put into operation until there is need for it due to rising cost," as Simon said, is in raisin grapes]. The production of raisins in California's Central Valley is one of the most labor-intensive activities in North America. Conventional methods require bunches of grapes to be cut by hand, manually placed in a tray for drying, manually turned, manually collected.

But starting in the 1950s in Australia (where there was no large supply of foreign farm labor), farmers were compelled by circumstances to develop a laborsaving method called "dried-on-the-vine" (DOV) production. This involves growing the grapevines on trellises, then, when the grapes are ready, cutting the base of the vine instead of cutting each bunch of grapes individually. This new method radically reduces labor demand at harvest time and increases yield per acre by up to 200 percent. But this high-productivity, innovative method of production has spread very slowly in the United States because the mass availability of foreign workers has served as a disincentive to farmers to make the necessary capital investment.

But perhaps immigration's role in retarding economic modernization is confined to agriculture, which, after all, is very different from the rest of the economy. Nope. Manufacturing sees the same phenomenon of a scarcity of low-skilled labor yielding innovation while a surfeit yields stagnation. An example of the latter: A 1995 report on southern California's apparel industry, prepared by Southern California Edison, warned of the danger to the industry of reliance on low-cost foreign labor:

In southern California, apparel productivity gains have been made through slow-growth in wages. While a large, low-cost labor pool has been a boon to apparel production in the past, overreliance on relatively low-cost sources of labor may now cost the industry dearly. The fact is, southern California has fallen behind both domestic and international competitors, even some of its lowest-labor-cost competitors, in applying the array of production and communications technologies available to the industry (such as computer aided design and electronic data interchange)." (Emphasis in original)

Conversely, home builders, who are still less reliant on foreign workers than some other industries, have begun to modernize construction techniques. The higher cost of labor means that "In the long run, we'll see a move toward homes built in factories," as Gopal Ahluwalia, director of research at the National Association of Home Builders, told the Washington Post several years ago. But as immigrants increasingly move into this industry, we can expect such innovation to spread much more slowly than it would otherwise.

But surely immigration is needed fill jobs in the service industry? After all, without immigrants, who will pump our gas? Oh, wait — we never imported immigrants for that and so now we pump our own gas, aided by technology that lets us pay at the pump — thus we have fewer attendants but more gas stations and get in and out faster than we used to when we trusted our car to the man who wore the Texaco star.

Other innovations suggest how, despite the protestations of employers, a tight low-skilled labor market can spur modernization even in the service sector: Automated switches have replaced most telephone operators, continuous-batch washing machines reduce labor demand for hotels, buffet-style restaurants need much less staff that full-service ones. As unlikely as it might seem, many VA hospitals are now using mobile robots to ferry medicines from their pharmacies to various nurse's stations, eliminating the need for a worker to perform that task. And devices like automatic vacuum cleaners, lawn mowers, and pool cleaners are increasingly available to consumers. Keeping down low-skilled labor costs through the president's vast new guestworker plan would stifle this ongoing modernization process.

The idea that a modern society like ours requires the ministrations of foreign workers, because there is no other way to do get these jobs done, smacks of the apocryphal quote from a 19th-century patent commissioner: "Everything that can be invented has been invented."

NRO Contributor Mark Krikorian is executive director of the Center for Immigration Studies and a visiting fellow at the Nixon Center.


TOPICS: Business/Economy; Editorial
KEYWORDS: aliens; immigrantlist; immigration
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1 posted on 01/07/2004 10:51:14 AM PST by xsysmgr
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To: xsysmgr
----AMEN-----
2 posted on 01/07/2004 10:52:09 AM PST by rellimpank
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To: xsysmgr
buffet-style restaurants need much less staff that full-service ones

Hey...that's great Mark..If you like scarfing at Sizzler, it's all good, but many of us prefer our dining out to be Dining.

3 posted on 01/07/2004 10:53:40 AM PST by hobbes1 ( Hobbes1TheOmniscient® "I know everything so you don't have to" ;)
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To: hobbes1
Ride your tray ?
No thanks.
4 posted on 01/07/2004 10:56:36 AM PST by Eric in the Ozarks
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To: xsysmgr
thus we have fewer attendants but more gas stations and get in and out faster than we used to when we trusted our car to the man who wore the Texaco star.

And those of you that don't live in NJ or Oregon, sweat in the summer, freeze in the winter, get wet in the rain...etc.

5 posted on 01/07/2004 10:57:13 AM PST by hobbes1 ( Hobbes1TheOmniscient® "I know everything so you don't have to" ;)
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To: xsysmgr
I don't buy the WH's argument that there are jobs Americans "won't do".

Look, IF there are jobs Americans "won't do" then we don't have "unemployment". We have "refuse-employment".

6 posted on 01/07/2004 10:57:26 AM PST by BenLurkin (Socialism is Slavery)
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To: Eric in the Ozarks
My Point exactly. Apparently MArk thinks we should all be eating at Sizzler.
7 posted on 01/07/2004 10:57:42 AM PST by hobbes1 ( Hobbes1TheOmniscient® "I know everything so you don't have to" ;)
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To: xsysmgr
But it's the second part of the response to a tighter labor market that people just don't get. By holding down natural wage growth in labor-intensive industries, immigration serves as a subsidy for low-wage, low-productivity ways of doing business, retarding technological progress and productivity growth.

Not to mention that the TRUE COST of these workers (school systems, hospital visits, subsidized housing, food stamps... etc) is shifted to the taxpayer.

8 posted on 01/07/2004 10:58:40 AM PST by StatesEnemy
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To: BenLurkin
Good. Are you filling out that application to empty $#!tcans at Sizzler yet?
9 posted on 01/07/2004 10:58:58 AM PST by hobbes1 ( Hobbes1TheOmniscient® "I know everything so you don't have to" ;)
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To: BenLurkin
Concur. At any rate all those "americans won't do" jobs have been filled ten times over by legal immigrants who have come into this country over the last 50 years. If there are still some jobs, then let the legal immigrants (go through the legal process) get them.
10 posted on 01/07/2004 11:01:41 AM PST by ampat (to)
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To: BenLurkin
No, it means the companies that are in need of folks to do these physically demanding, often hazardous jobs, are not playing by market rules - which is the same for a slice of bread as it is for labor.

Instead, they are importing slaves, and letting the rest of us subsidize their existence.

11 posted on 01/07/2004 11:01:44 AM PST by StatesEnemy
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To: xsysmgr
TO hear some folks tell it, you couldn't get a home built here in the Southwest without Mex labor, but I can tell you that's not true:

Just yesterday I moved into our new place, and I don't think a single worker on that job speaks any more Spanish than "una mas cerveza, por favor, senorita!"

BTW, it came in under budget and only a *little* late!
12 posted on 01/07/2004 11:03:43 AM PST by Redbob (now to find a cure for global whining...)
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To: xsysmgr
Mark you are not living in the real world.

I for one and I am sure there are many - would welcome some SERVICE! for a change!

Everywhere I go surly, lazy incompetent US born employees (many so-called professional ones) resent their jobs and as a result the customer/client is given short shrift.

Bring on the Mexicans or anyone else who is willing ot do the work without some tight assed unionists hovering in the background telling employees tbey have a right to dish out poor service.

13 posted on 01/07/2004 11:05:14 AM PST by eleni121
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To: Redbob
Just yesterday I moved into our new place, and I don't think a single worker on that job speaks any more Spanish than "una mas cerveza, por favor, senorita!"

That's pretty interesting, but why are they calling YOU senorita?

14 posted on 01/07/2004 11:05:44 AM PST by hobbes1 ( Hobbes1TheOmniscient® "I know everything so you don't have to" ;)
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To: eleni121
Amen. See 3.
15 posted on 01/07/2004 11:06:18 AM PST by hobbes1 ( Hobbes1TheOmniscient® "I know everything so you don't have to" ;)
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To: xsysmgr
If the supply of foreign workers were to dry up (say, through actually enforcing the immigration law, for starters), employers would respond to this new, tighter, labor market in two ways. One, they would offer higher wages, increased benefits, and improved working conditions, so as to recruit and retain people from the remaining pool of workers. At the same time, the same employers would look for ways to eliminate some of the jobs they now are having trouble filling. The result would be a new equilibrium, with blue-collar workers making somewhat better money, but each one of those workers being more productive.

These "jobs American" won't do" only exist at that wage level and working condition because aliens can be found to do the work.

Illegals are a massive subsidy to business, which shifts the cost of illegals onto the taxpayers through the welfare state.

Illegal labor is "cheap" only to sleazy employers, it is very expensive to the rest of us.

16 posted on 01/07/2004 11:07:14 AM PST by WackyKat
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To: StatesEnemy
Well the "slaves" sure seem happy to be working and getting paid.

They also seem to be dying to get into slavery!

The truth is that Socialists want to stifle the economy by establishing the so called "living wage" which is in fact the wage that will cash this economy into the dust, especially for first time employees.

17 posted on 01/07/2004 11:09:15 AM PST by eleni121
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To: xsysmgr
grant amnesty to millions of illegals

How sad.

18 posted on 01/07/2004 11:10:28 AM PST by Dubya (Jesus saith unto him, I am the way, the truth, and the life: no man cometh unto the Father,but by me)
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To: BenLurkin
Take them of of transfer payemnts and they will take those jobs.
19 posted on 01/07/2004 11:14:44 AM PST by CasearianDaoist
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To: *immigrant_list; A Navy Vet; Lion Den Dan; Free the USA; Libertarianize the GOP; madfly; B4Ranch; ..
ping
20 posted on 01/07/2004 11:14:49 AM PST by gubamyster
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To: hobbes1
Hey...that's great Mark..If you like scarfing at Sizzler, it's all good, but many of us prefer our dining out to be Dining.

Them be willing to pay the true cost of such service instead of foisting it off on the taxpayers.

21 posted on 01/07/2004 11:15:20 AM PST by sarcasm (Tancredo 2004)
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To: WackyKat
You've been listening to the AFL CIO unionists who don't know beans about wages or labor or upward mobility if it smacked them in the face.

In fact, this policy will unleash thousands of more businesses allowing them to hire employees who are thankful for a job and do a great job at it! It will also allow the feds to collect taxes on formerly untaxed labor and bring the folks into the US family honorably.

Bravo President Bush!

22 posted on 01/07/2004 11:15:32 AM PST by eleni121
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To: eleni121
There already is a "Living Wage"

It's all the social programs directed at those below the poverty line - which subsidize this cheap labor pool for these barons.

23 posted on 01/07/2004 11:15:51 AM PST by StatesEnemy
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To: xsysmgr; Willie Green
Yeah so? Willie Green would be posting Luddite articles making the machines doing human work the enemy, rather than Mexicans, so what's the point?
24 posted on 01/07/2004 11:18:10 AM PST by Dane
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To: xsysmgr
"The idea that a modern society like ours requires the ministrations of foreign workers, because there is no other way to do get these jobs done, smacks of the apocryphal quote from a 19th-century patent commissioner: "Everything that can be invented has been invented."

Amen again.
25 posted on 01/07/2004 11:18:27 AM PST by Beck_isright ("Deserving ain't got nothing to do with it" - William Money)
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To: eleni121
In fact, this policy will unleash thousands of more businesses allowing them to hire employees who are thankful for a job and do a great job at it! It will also allow the feds to collect taxes on formerly untaxed labor and bring the folks into the US family honorably.

Get ready to pay higher taxes to subsidize them and their families

26 posted on 01/07/2004 11:21:11 AM PST by sarcasm (Tancredo 2004)
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To: StatesEnemy
barons

Absurd terminology. The average entrepreneur struggles to keep his business afloat: regulations, insurance, lawsuits, ad nauseum.

Most folks start out making low wages and move up. Some are eligible for government programs (food stamps, lower cost insurance) but not all and a minimal net is useful for all not just those who receive them.

The "social programs" you should be fretting about are mostly directed at the middle and upper classes. Think about it!

27 posted on 01/07/2004 11:22:20 AM PST by eleni121
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To: Dane
ROTFLMAO!!!!.....The Most Brilliant observation to date, Dane.
28 posted on 01/07/2004 11:23:01 AM PST by hobbes1 ( Hobbes1TheOmniscient® "I know everything so you don't have to" ;)
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To: StatesEnemy
These jobs that "Americans won't do" should be filled by y9ooung Americans, teens and college students. Employment is a learned behavior. I hire people all the time and you'd be surprised how many young people who enter the workforce who have never had a job and don't understand the work environment. Practices such as coming to work on time, showing up every day, ethical honest work habits, productivity. So many of the young people I have hired think they are in the building (at work) they are do pay- even if they are not productive. I'd rather train a young person the ethics of work at a minimum wage busboy job then to try to explain the basics to a kid who has a degreee in civil engineering but thinks a two hour lunch is OK.

If not young people, then people who are holding down one medium pay job and need another part time job to get ahead. There is no reason to give jobs to anyone other then Americans in America.

29 posted on 01/07/2004 11:23:01 AM PST by rbessenger
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To: eleni121
You've been listening to the AFL CIO unionists who don't know beans about wages or labor or upward mobility if it smacked them in the face. In fact, this policy will unleash thousands of more businesses allowing them to hire employees who are thankful for a job and do a great job at it! It will also allow the feds to collect taxes on formerly untaxed labor and bring the folks into the US family honorably.

I didn't know The National Review was AFL_CIO publication! thanks for informing me

All this is going to "unleash" is a further depression of American wages and another wave of 10-15 million (illegal) workers who have been given the greenlight to come here because this country refuses to enforce its borders or laws

I'm sure it will make the corporate internationalists very happy , though, with all the serfs they'll have to exploit

30 posted on 01/07/2004 11:23:34 AM PST by WackyKat
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To: sarcasm
Most of my taxes go to subsidize union-made products and sevices that could be produced for lots less.

Most of my taxes go to pay for union techers who can't pass the teacher board exams and who make more than the average space scientist.

31 posted on 01/07/2004 11:24:55 AM PST by eleni121
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To: eleni121

32 posted on 01/07/2004 11:25:42 AM PST by sarcasm (Tancredo 2004)
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To: eleni121
The average entrepreneur struggles to keep his business afloat: regulations, insurance, lawsuits, ad nauseum.

Hey I'm ALL FOR streamlining the bureaucratic process, going after greedy insurance companies, and creating meaningful tort reform.

That doesn't mean I think that corporate America should have the right to shift the TRUE COST of their workers upon the US Taxpayer.

33 posted on 01/07/2004 11:25:56 AM PST by StatesEnemy
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Comment #34 Removed by Moderator

To: WackyKat
Don't just spout off for the sake of spouting off.

Read the President's proposals and then comment. A large part of them refer to the border situation and the monitoring of illegals under his proposals.

As for the unions - They blabber the same thing you posted. I was responding to that not the NRO article.

35 posted on 01/07/2004 11:28:59 AM PST by eleni121
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To: BenLurkin
Americans work underground in coal mines under threat of cave-ins and poison gas.

Americans work as garbage men, outdoors in all kinds of weather, each man lifting several tons of stinking, leaking garbage every day.

Americans work in sewers and Americans work hundreds of feet in the air walking steel beams.

There is no job Americans won't do.

36 posted on 01/07/2004 11:29:22 AM PST by Age of Reason
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To: xsysmgr
I think we could end this lazy streak that some in this country have by ending welfare and closing the border. Then again, there are some "jobs" or elected officials "won't do".
37 posted on 01/07/2004 11:32:34 AM PST by wasp69 (This tag line for sale because Dave Ramsey said so.)
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To: eleni121
Yea, right, Bush just lost my vote and the GOP just lost the 200 bucks I usually send them.

Bye the way, you get good service by tipping, try it some time.

38 posted on 01/07/2004 11:33:17 AM PST by jpsb
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To: xsysmgr
I have a hundred dairy cows...

Those industrious Holsteins produce vats of milk and cream every day for my bottom line (and my shareholders)... and the best part?

Their barn was built (and is heated) with taxpayer money (subsidized housing).

Their feed? You guessed it, bought by the "commonwealth" (food stamps)

When one of them gets sick? I send the vet bill to Washington.

What A Country!

39 posted on 01/07/2004 11:35:40 AM PST by StatesEnemy
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To: xsysmgr
Even if there is a labor-shortage, there's plenty of Welfare recipients and Convicts available to work off their debt to the government for all the services they're provided with.
40 posted on 01/07/2004 11:37:39 AM PST by jonatron
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To: Beck_isright
Get with the program we need a 19th century immigration policy so we can remain a 21st century superpower or something like that.
41 posted on 01/07/2004 11:38:55 AM PST by junta
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To: AAABEST
We should turn our system of justice on it's head, destroy our social services, crumble medical and educational system ........

No, But I can say hysterical xenophobic pig....

42 posted on 01/07/2004 11:39:12 AM PST by hobbes1 ( Hobbes1TheOmniscient® "I know everything so you don't have to" ;)
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To: eleni121
Gee another Northeastern liberal isolated from the havoc wreak by a full fledged migration of the third world.

"Bravo President Bush". Thank you for further ruining our schools, hospitals and pushing your election off on the taxpayers. Bravo for the increase in violent crime in my area and the inablility of our children to find entry level work. Thank you for making our laws a joke and rewarding foreigners for breaking them.

Thank you for your blue-blooded "I don't give a s**t" attitude. Bravo to your contempt for our constitution and spitting in the face of many of the people who went to bat for you. Thank you for putting your own Rockafeller ass before your coutry and it's constitution. You have proven there is no party that respects the law and not a "party of men" anymore.

At least it's cheap to eat at Taco Bell and agricorps don't have to hire Americans anymore.

BRAVO

43 posted on 01/07/2004 11:39:19 AM PST by AAABEST
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To: StatesEnemy
The miniscule costs of basic health and food benefits for immigrants legal and otherwise are far outstripped by the breaks that the middle and upper economic classes receive in the form of tax loopholes and benefits.
44 posted on 01/07/2004 11:39:34 AM PST by eleni121
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To: eleni121
So now they can become taxed employees and become yet poorer, but at least you made it easier for them to get on the entitlement bandwagon.
45 posted on 01/07/2004 11:40:36 AM PST by junta
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To: junta
LOL, absolutely. Why depend on technical innovation when you can hire tax free illegals.
46 posted on 01/07/2004 11:41:00 AM PST by Beck_isright ("Deserving ain't got nothing to do with it" - William Money)
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To: jpsb
Bye the way, you get good service by tipping, try it some time.

Actually, by the way, a TIP is Earned by providing good service....Or do you tip up front, when they bring the menu?

47 posted on 01/07/2004 11:41:56 AM PST by hobbes1 ( Hobbes1TheOmniscient® "I know everything so you don't have to" ;)
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To: eleni121
First of all, the burden of illegals on our social systems is hardly MINISCULE.

As for loopholes and creative accounting 'techniques' - I'm all for a flat tax that does away with all those evasions.

48 posted on 01/07/2004 11:43:18 AM PST by StatesEnemy
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To: AAABEST
Angry agressive words from somone who would rather not think and would prefer to rant and blame the problems on those who are desperately trying to fix them.

There's another little angry guy out there who sounds just like you and he's from Vermont.

49 posted on 01/07/2004 11:44:26 AM PST by eleni121
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To: xsysmgr
Here we go....
50 posted on 01/07/2004 11:45:25 AM PST by StatesEnemy
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