Let the job market choose our immigrants

Mike Konczal has a new article where he claims there is now a great natural experiment unfolding in the U.S. economy, allegedly one that Ramesh Ponnuru and I proposedback in 2011:

Report Shows Netherlands Would Benefit by Leaving Eurozone Inquiring minds are reading a 73 page detailed report The Netherlands & The Euro that explains country by country why Italy, Greece, Portugal, and Spain are going to need lots more money, and the Netherlands and Germany will end up footing the bill.

Initial Reaction The establishment report of +146,000 jobs was about what most expected. However, beneath the surface, this report looks grim. The household survey shows a loss of 122,000 jobs. The unemployment rate dropped by .2% because the labor force fell by 350,000 and those "not in the labor force" rose by a whopping 542,000. Thus, we are back to the previous 2012 pattern of witnessing unemployment rate drop largely because of a massive increase of those "not" in the labor force.

DAVOS — Youth unemployment is at staggering levels in the European Union. Every fourth young person between the ages of 15 and 24 is unemployed, amounting to around 5.5 million young adults without a job. In Spain, recent employment data indicate that the number has risen to 60 percent, a new record.   The figures serve as a stark reminder of the fundamental problems within some of Europe’s southern economies.  

Carlos Hernandez Sonseca studied six years for a bachelor’s degree and couldn’t find a job near his home outside Madrid when he graduated in 2011. Last year, he took an increasingly well-worn path to the U.K. The 27-year-old journalist now washes and chops vegetables eight hours a day at the Vital Ingredient salad bar in London’s financial district, making 260 pounds (US$418) before taxes in a 40-hour week. Thirteen other Spaniards are among a workforce of 17, said manager Francisco “Chico” Baumle, a Brazilian.

ByAlpha Guru:The continuation of low interest rates and expectation of central bank involvement in the sovereign debt markets over the coming years should ease the debt burden of most developed economies. The combination of low interest rates and higher-than-expected inflation levels, given the slow growth environment, will lower the costs of financing the debt load and reduce the real debt burden respectively.