With the “papers please” portion of Arizona’s recent immigration law SB 1070 going into effect, civil rights and watchdog groups are in overdrive readying for the litany of purported abuses and complaints. Lydia Guzman, president of Respect Respeto, a civil rights group in Arizona that records abuses at the hands of police, said, “Our hotline has been receiving hundreds of calls a day since the law was implemented.”
Forcibly removing peaceful unauthorized immigrants from the U.S., separating them from their families, property, and jobs, to satisfy arcane labor market regulations created by progressive politicians, is an appalling indecency. It also inflicts significant economic harm. Arizona’s immigration laws have drastically damaged its economy since mid-2007. The humanitarian arguments may leave those who complain the loudest about unauthorized immigration unmoved, but the supporters of Arizona style immigration laws might be persuaded by the economic costs.
In a new Policy Analysis by the Cato Institute called “The Economic Case against Arizona’s Immigration Laws,” I analyze the economic carnage inflicted by Arizona’s immigration laws.
The Legal Arizona Workers Act (LAWA or employer sanctions) was the first such law, and it tried to regulate unauthorized workers out of the market. Its chief tool is E-Verify, an electronic employment eligibility verification system used to weed out unauthorized immigrants when they apply for a job.
E-Verify has three major problems. It is very expensive, discourages investment and increases unemployment.
Just to run an employee through costs around $147 [≈ Household daily income (2011)]. Compliance, however, also requires additional human resources and legal services, increasing the financial burden on firms.
The second problem is that E-Verify scares away businesses, investment, and workers. E-Verify is tied to what then-Governor Janet Napolitano called the “business death penalty.” Businesses that knowingly hire unauthorized immigrants have their licenses revoked on a second offense, killing the business.
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