Federal Reserve Chairman Jerome Powell told Sen. J.D. Vance (R-Ohio) that the U.S. government’s immigration policies increase inflationary pressures in some parts of the economy but reduce them in other parts.
“Overall, I wouldn’t say it’s the driving force in terms of overall inflation. [of inflation] Either way,” Powell told Vance on July 9.
WATCH — Sen. J.D. Vance reveals his strategy for winning the election with working-class Rust Belt voters:
Matt Purdy/Breitbart News
Powell’s admission refutes claims made in the media by many business leaders, including Goldman Sachs, that increased immigration would help curb the inflation that has plagued President Joe Biden’s administration. The unsubstantiated claims are: The New York Times.
But Powell did not discuss how immigration reduces investments in the workplace that increase the productivity and wealth of American workers.
Immigration does suppress wages and wage inflation, but it also raises home prices and housing inflation. According to Powell:
Over the past few years, many people have come to the country, many through asylum applications, to work, and the labor supply has increased significantly.
There is no clear answer, but I feel that in the long run immigration is neutral to inflation.
In the short term, it may have actually helped as the labor market eased. [allowing employers to cut wages]
But you’re talking about housing, and I’m sure there are parts of the country where new people are coming in and adding to an already tight housing market. [so allowing landlords to raise rents].
Powell’s remarks followed earlier comments by other members of the Federal Reserve’s 12-member board of governors.
“While the longer-term effect of increased immigration on inflation is unknown, immigrants need places to live, and their arrival in the United States likely increased demand for housing,” Neel Kashkari, president of the Federal Reserve Bank of Minneapolis, said on May 7.
On the other hand, he said mortgage rates are trending upwards as interest rates rise, and that “there is probably a neutral [interest] Interest rates in the housing market are higher than they were before the pandemic.”
“Given the current low inventory of affordable housing, the influx of new immigrants into some areas could lead to upward pressure on rents as additional housing supply may take time to materialize,” said Michelle W. Bowman, another board member. Said June 25. But the influx of migrant workers has also dampened wage growth and wage inflation, she said.
But while immigration helps the overall economy and investors, it hurts ordinary Americans who have to pay higher housing costs and lower wages. For example, Statista reports that Americans’ disposable income per capita (adjusted for inflation) fell from $48,490 in 2021 to $45,343 in 2022.
WATCH — ABC’s Raddatz criticizes Mayorkas on border: Hard to call 6.5 million immigrants a success:
Since the 1970s, wage-earning Americans zigzag While a declining share of new wealth is being created each year, an increasing amount of wealth is being transferred to investors through a massively inflated stock market.
The influx of new wage income into the stock market has shifted wealth toward older, wealthier stock owners: the richest 10% of Americans own 93% of stocks, while the bottom half of Americans own just 1% of all stocks. The remaining 6% of stocks are held by upper middle-class Americans. Yahoo!.
Many advocates of increased immigration argue that an influx of immigrants benefits the economy by providing workers at a time when employers feel pressured to raise wages for Americans. “Pull factors, such as a tight U.S. labor market, strongly influence the number of people crossing the southwestern U.S. border,” said one immigration policymaker. May 2024 Report by Dany BaharVenezuelan immigrant activist.
But immigrants also reduce Increased productivity will gradually raise Americans’ wages and keep inflation in check.
“We are seeing a tight labor market, [a labor shortage] In the short term, this will lead to inflationary pressures. [the resulting] “Stronger productivity growth could help expand capacity and ease price pressures in the longer term.” Said A June 2024 report from the Federal Reserve Bank of St. Louis. The report states:
The debate over labor issues and automation often [Wall Street] Earnings conference calls. For example, during the first quarter of 2024 earnings conference call, an executive from an automotive technology company said: “Our focus this year is to accelerate automation to address wage inflation and improve factory efficiency.” This excerpt clearly illustrates the phenomenon of companies turning to automation as a way to reduce labor costs.
…
Firms in industries with a high reliance on routine, manual tasks (about one-sixth of our sample) that mention labor issues in their earnings reports experience higher labor productivity. Specifically, we find that a one-unit increase in labor issues is associated with an 8.9 basis points increase in productivity after four quarters. Notably, the impact of a tight labor market on productivity is negative for firms that rely on non-routine tasks. Because these firms cannot easily substitute labor for capital, the labor issues they face further impede productivity growth.
The damage caused by the shift to greater productivity is becoming more recognised at the highest levels.
“We always [a] Decreasing population is a negative factor [economic] “Economic growth is critical to the growth of our countries,” BlackRock founder Larry Fink said at a pro-globalization event hosted by the World Economic Forum in Saudi Arabia in April.
But in conversations with leaders of these great developed countries, [such as China, and Japan] No one can enter a country with xenophobic, anti-immigration policies. [so they have] Robotics, AI and technology will develop rapidly in these countries with declining populations. All the promise of transforming productivity. Most of us would think so. [emphasis added] Even if the population declines, we will be able to improve the standard of living of the country and individuals.
Canadians suffer from the same immigration issues as Americans.
For example, Prime Minister Justin Trudeau’s immigration-maximizing economic policy is reducing productivity by redirecting investment in automation to the expensive housing needed by a larger population.
“An increasing share of savings and investment is flowing into real estate and construction, which, while necessary and beneficial for many reasons, is relatively inefficient and can hinder productive growth across the economy.” Hospitalized According to a report released June 4 by RBC Royal Bank of Canada, “Adjusted for inflation and immigration, Canada’s economy is smaller than it was in 2019 and roughly the same as it was 10 years ago.”
Extract Migration
Since at least 1990, the federal government has quietly adopted extractive migration policies to grow the consumer economy after helping investors relocate high-wage manufacturing sectors to low-wage countries.
Immigration policies extract huge amounts of human capital from impoverished countries: additional workers, white-collar graduates, consumers, renters. Boost stock prices By cutting American wages, subsidizing less productive businesses, raising rents, and sending real estate prices soaring.
The rarely mentioned economic policies have driven many native-born Americans out of various business careers, reduced American productivity and political influence, slowed high-tech innovation, reduced trade, and Citizen solidarityand government officials and progressives Rising mortality rate of Discarded, Low status American.
Donald Trump’s campaign recognizes the economic impact of immigration: Biden’s unpopular policies “flood the American workforce with millions of low-wage illegal immigrants, a direct attack on the wages and opportunity of hard-working Americans,” the Trump campaign said in a May statement.
This secretive economic policy has siphoned jobs and wealth from the Midwestern states by providing coastal investors and government agencies with a flood of low-wage workers, over-occupied renters and subsidized consumers. Similar policies are harming the people and economies of Canada and the UK.
Policies like colonialism have also harmed small nations and killed hundreds of Americans and thousands of immigrants, including: Taxpayer-Funded Jungle Trail Through the Darien Canyon in Panama.
