Romney's Anti-Immigrant Stance Could Destroy the Nation's Economy

Mitt Romney’s leading claim to presidential fame—that he has the business acumen to fix the economy—may suffer as potentially blinding a setback as his trouncing by Rick Santorum in this week’s Republican primaries and caucuses in Colorado, Minnesota and Missouri.

Communities of color have been alarmed by his hardcore stance on immigration. The not-quite frontrunner applauds self-deportation and has called for an end to bilingual ballots, even while competing in Florida, Nevada, Colorado, and soon Arizona, states with many bilingual voters.

But in Alabama, where Republicans enacted landmark anti-immigrant legislation in 2011 with the goal of prompting illegal immigrants to flee, the policy that Romney is now championing is wrecking the state’s economy, concluded a report by the University of Alabama, which found that it is draining billions from Alabama’s economy, including millions in lost tax revenue.

"Economies are demand-driven, so any policy, regulation, law, or action that reduces demand will not contribute to economic development," said Samuel Addy, director of UA's Center for Business and Economic Research. "The law itself is costly mainly because it reduces demand in the state economy."

The UA analysis is based on economic principles taught to college freshmen, so simple that one would think Romney, who has a Harvard University business degree, would know: when you drive wage-earners out of the state, businesses suffer. The UA report’s conclusion is stark and striking, especially when you consider how fragile Alabama’s economy is. 

“Assuming that the law causes 40,000-80,000 unauthorized immigrant workers who earn $15,000-35,000 a year to leave the state,” it concludes, “the resulting decline in aggregate demand would have annual economic and fiscal impacts of reductions of about (i) 70,000- 140,000 jobs with $1.2-5.8 billion in earnings, (ii) $2.3-10.8 billion in Alabama GDP or 1.3-6.2 percent of the state’s $172.6 billion GDP in 2010, (iii) $56.7-264.5 million in state income and sales tax collections, and (iv) $20.0-93.1 million in local sales tax collections."

Romney’s embrace of such radical and destructive economic policy undercuts his oft-repeated claim that he can fix the nation’s economy—unlike Obama. It remains to be seen if Romney and his allies will have a tough time championing their draconian views on immigration as more Americans learn that their hardline seems to be decimating Alabama’s economy.

 

What Happened In Alabama?

After Arizona enacted landmark anti-immigration legislation in 2010 to identify, prosecute and deport illegal immigrants, a handful of other states followed suit. Alabama House Bill 56 was the toughest of them all, making it a crime for anyone undocumented to be in the state. It ordered local police to examine the papers of anyone officers thought was illegal. Beyond that, the law requires schools to check the legal status of all students, invalidates contracts made with undocumented persons (including apartment leases), and makes it a felony for illegal immigrants to deal with government agencies like public utilities.

As soon as Republican Governor Robert Bentley signed the law, it had an immediate and chilling effect. Self-deportation began quickly. Roofers and road workers, landscapers and laborers, and others streamed out of Alabama taking their families with them. Farmers discovered they could not harvest crops because migrants moved away. Alabamians did not want to replace them in hot, muggy fields. And schools reported high rates of absenteeism among Hispanic students, many of whom never returned to class.

Some parts of the law were put on hold by the courts and many of its original supporters changed their tune. State lawmakers are rushing to make changes to the bill but Republicans and Gov. Bentley vow the overall intent of the law will survive. Republican State Representative Jim McClendon says regular statewide polling proves the public is solidly behind the law.