Peter Brimelow writes: Forbes Magazine has just published my charticle demonstrating the European Union's strikingly low labor force participation rates compared to the U.S. (Click here – don't forget to continue through to the actual chart, which in the web version is shown separately. Forbes still allows free access to its web page, but now you have to register, like The New York Times. It seems a fairly harmless process. And you get a grateful email from Tim Forbes.)
The Europeans are constantly being told, e.g. recently by Nick Eberstadt in The Washington Post, that their population is aging and they have to import a lot of Arabs to compensate. This is, of course, a screamingly simplistic analysis. You can't argue from people to production, because labor is only a minor part of the factors of production – far outweighed by e.g. technology.
But what this charticle shows is that, even so, Europe's problem is not decrepit people, but a decrepit labor market. Government policy just plain encourages people not to work.
Ironically, U.S. government policy has been discouraging Americans from working too. We examined declining American labor force participation in a 1998 charticle. Things just haven't gotten as bad as Europe, yet.
The underlying point remains the same: the demand for immigrants (especially for illegal immigrants working off the books) is often just the shadow of regulation. Government policy is creating a problem for which another government policy – importing labor – is the proposed solution. Immigration is favored by government, and by the political class generally, because while labor market policies may be wrong, they create client constituencies. And immigration is creating the biggest client constituency of all.
March 19, 2001