Friedman Contra Open Borders (1999): A Line-by-Line Critique

Nobody's perfect, not even Milton Friedman

Milton Friedman was so intellectually impressive that even his Q&A continues to intrigue us. In 1999, he responded to three questions about open borders. Here’s my line-by-line critique. Friedman (and his questioners) are in blockquotes; I’m not.

There's another question. Should the USA open its borders to all immigrants? What's your opinion on that?

Unfortunately, no.

And I say unfortunately. You cannot simultaneously have a welfare state and free immigration. I am in favor of free immigration, but not if you have a welfare state. The United States had free immigration at the end of 19th early, throughout 19th century, and up until World War I, really. But that was possible because the United States was not a welfare state.

An absurd overstatement. As I explain in Open Borders, this is as silly as saying, “You cannot simultaneously have a welfare state and free reproduction.”

Yes, the welfare state creates some bad incentives for natives to have kids they can’t support. But that hardly shows that the consequences are bad enough justify draconian restrictions on the right to have children.

Even from a normal point of view, much less a libertarian one.

While Friedman would almost surely have been horrified by the idea of preventing the poor from reproducing, he embraces immigration restrictions casually. He doesn’t fret about the loss of immigrants’ freedom. He doesn’t show that the fiscal burden of immigration is heavy enough to offset the economic gains. He doesn’t even try to show that the fiscal burden of immigration is high.

If he had, he would have learned that according to standard estimates, most (but not all) immigrants to the U.S. remain fiscal positives even with the welfare state. Mea culpa, I was too optimistic about this in Open Borders, but not by much.

When my parents came to the United States at the end of 19th century, they didn't get any welfare when they got here. They were able to exist by the charity of relatives who had come here earlier. They were able to make their way in a free market and therefore people only came here. People came to the United States in order to use their resources and their capacities and were productive and help themselves and help the rest of the people who are here. But if you have a welfare state in which immigrants as in now are eligible to receive relief, to receive benefits, and so on, you have people immigrating, not in order to use their resources in a productive way, but as it were, to be parasites on the rest of the society.

Undeniably, some people take advantage of the welfare state. But at least in the U.S., a supermajority of immigrants still prefer to work. Indeed, despite the welfare state, immigrants have higher labor force participation rates than natives.

And unfortunately, there are an unlimited number, an infinite number of supply of people who want to live on somebody else's expense.

Friedman was 87 when he spoke, so I gladly forgive his lapse into innumerate paranoia. But this is the kind of nonsense that he rightly ridiculed throughout his career.

And so the result of that is that unfortunately, you cannot have completely free immigration, in my opinion, in a welfare state.

My most charitable take on Friedman is that he was writing before scholars like Michael Clemens showed how massive the economic benefits of immigration are. Friedman repeatedly revised his opinions in response to new empirics, so perhaps if he’d lived to absorb the lessons of this research, he would have recanted.

Here's one question. Do you oppose a unilateral reduction of tariffs? And if not, how can you oppose open immigration until the welfare state is eliminated?

I am in favor of a unilateral reduction of tariffs. But the movement of goods is a substitute for the movement of people.

A poor substitute, because most of the modern economy is services. And despite the rise of telework, almost all services — nanny, babysitter, gardener, plumber, waiter, cook, elder care worker, and beyond — must still be performed in person.

I, as long as you have a literal welfare state, I do not believe you can have unilateral open immigration. I would like to see a world in which you could have open immigration. But stop kidding yourself. On the other hand, the welfare state does not prevent unilateral free trade. I believe that they are in different categories.

Friedman misses the central point of this question: Namely, whether libertarians should accept the existence of some bad regulations as a good rationale for the preservation of other bad regulations. Friedman claims that trade and immigration are “in different categories,” and in some ways they are. Still, “I believe in free trade, but not unless other countries embrace free trade, too” structurally parallels, “I believe in open borders, but not unless we abolish the welfare state, too.”

Both arguments allow for a range of reactions. You could shrug, “Unfortunately, that’s the world we’re in. Liberty will have to wait.” But you could also icily reply, “Drawback duly noted. Full speed ahead.” Since Friedman has “always been in favor of unilateral free trade whenever you can get it,” why hasn’t he also “always been in favor of immediate free migration whenever you can get it”?

Before you dismiss both of the latter stances as naive, remember the much-maligned Shock Doctrine: “Let’s get rid of whatever bad regulations we can as soon as we can. Maybe we’ll start a chain reaction of abolition.” Wishful thinking? Friedman plainly embraces the Shock Doctrine for one massive issue: the budget. Why else would he emphatically declare: “I have always been in favor of any tax cut of any kind of any form, however you can get it, whenever you can get it”? Friedman isn’t pushing for financial crisis; he wants to Starve the Beast.

Thank you. Here's a follow-up, basically follow-up to that question says, that instead of a green card, can the USA issue a blue card, which the blue card does not give welfare?

That would be if you could do that, that would be fine. Okay.

But I don't believe you can do that. I believe it's not only that it's not politically feasible.

Almost none of Friedman’s policy reform ideas were initially politically feasible. A big part of his charm was that he defended reforms on their merits in order to gradually make them politically feasible.

I don't think it's desirable to have two classes of citizens in a society. We want a free society. We want a society in which every individual is treated as an end to themselves.

We don't want a society in which some people are in there under blue conditions. Others are in there under red conditions. Others are in there under black conditions. We want a free society. So I don't believe such, I haven't really ever thought of that system.

Such confusion! Friedman starts off by saying that the blue card is fine but not politically feasible. Then he starts talking as if a society that forbids immigration is somehow “more free” than a society that allows immigration but restricts access to welfare benefits.

Friedman spent his whole career pushing piecemeal free-market reforms. If he had the opportunity to end the licensing of barbers, he wouldn’t have balked, “We don’t want a society where doctors need licenses and barbers don’t.” He would have ended the licensing of barbers forthwith. Partly for the economic benefits, but also because he knew that a world that licenses both doctors and barbers is less free than a world that licenses doctors alone.

It's a new, I very rarely get a new question, but I must admit that's a new question for me. And I haven't really thought about it a great deal, but my initial reaction is, that it's a very undesirable proposal.

Sure, Friedman was 87. But that makes it all the harder to believe that he never heard this idea before. He must have known about the world’s many guest worker programs, which are roughly the same as a blue card. The most credible story is that Friedman’s memory failed him here.

Granted, most of us are no intellectual match even for the elderly Milton Friedman. Smart people struggle with open-ended questions even when they’re in their prime. The man was so good on his feet that fans are still quoting his extemporaneous answers. Hail the victorious dead.

That said, Friedman’s famous adage about free immigration and the welfare state is not just mistaken, but lazy. While we can imagine scary scenarios, a good look at the facts about immigration shows that we shouldn’t take such scenarios seriously.

And strange as it seems, Friedman apparently lived 94 years without taking a good look at those facts.