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Democrats' immigration plan, minimum wage hike will hurt poorest Americans most, critics say

“If you just have a program that essentially lets in anybody who wants to come in, what you're going to wind up doing is depressing wages, and really hurting the lower-skilled people," said Joseph LaVorgna, chief economist at the National Economic Council under former President Trump.

Updated: February 25, 2021 - 2:58pm

Democrats are coming under fire on two fronts for immigration and minimum wage plans that critics say will hurt the poorest Americans the most.

The Democrats released a plan this week to create a path to citizenship for roughly 11 million immigrants now living illegally in the U.S. The plan will hurt poorer Americans with its depressing effect on wages for U.S. citizens and legal immigrants, according to Joseph LaVorgna, chief economist at the National Economic Council during the Trump administration. 

The Democrats' plan would allow more immigrant labor from low-skilled workers, creating more competition for those low-skilled jobs, which in turn lowers the price employers are willing to pay, explained LaVorgna.

"If you just have a program that essentially lets in anybody who wants to come in, what you're going to wind up doing is depressing wages and really hurting the lower-skilled people right now on the bottom of the income" distribution, LaVorgna told "Just the News AM" television program. 

In 2010, under the Obama administration, the U.S. Civil Rights Commission released a report called "The Impact of Illegal Immigration on the Wages and Employment Opportunities of Black Workers."

Among its findings, the commission reported that "illegal workers are estimated to account for as much as one-third of total immigrants in the United States, and that illegal immigration has tended to increase the supply of low-skilled, low-wage labor available." 

About "six in 10 adult black males have a high school diploma or less, and are disproportionately employed in the low-skilled labor market in likely competition with immigrants," the commission found. "Evidence for negative effects of such competition ranged from modest to significant, according to the experts who testified, but even those experts who viewed the effects as modest overall found significant effects in occupations such as meatpacking and construction."

Helping African-American workers achieve their lowest unemployment rates in a generation was a goal of the Trump administration, and LaVorgna said making sure that illegal immigration doesn't supress wages for lower skilled workers should be a priority for any immigration plan.

"It has to be skilled immigration, it's got to be legal immigration," LaVorgna said. "The programs we've seen thus far — the bills put forward — don't appear to do that."

LaVorgna said a better alternative to a plan that rewards illegal immigration would be to follow immigration criteria seen in places like Europe and Canada, which place more weight on skills rather than, for example, family ties. "But unfortunately, the politics and the divisiveness sometimes gets in the way," he lamented, speculating that the Democrats' approach to the issue "has less to do with what good policy is, [and is] more about who who can we get on our side to push something through so as to remain in power."

Democrats are also coming under fire for their plan to hike the minimum wage gradually to $15 an hour over five years, a proposal tucked into the $1.9 trillion Biden stimulus plan. The nonpartisan Congressional Budget Office estimated the proposal would result in the loss of 1.4 million jobs (for workers more likely to be poor and nonwhite, according to University of California, Irvine economist David Neumark) and price hikes of goods for poorer Americans as companies pass their increased costs on to consumers.  

Sen. Tim Scott (R-S.C.), the first black Republican U.S. Senator elected in the South since Reconstruction, speaks often about growing up in an impoverished home, raised by a single mother, yet was able to achieve great career success through work and dedication.  

"As a child who grew up working jobs under the minimum wage, and as a business owner that paid over the minimum wage, I know this mandate will kill jobs and destroy our small businesses," Scott said in a post on Instagram. "The Dems $15 minimum wage hike doesn't make sense."

The White House press office did not respond to a request for comment for this article.

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