UK politicians’ ignorance towards immigration gives Juncker credit he probably doesn’t deserve

It’s a tough day when you have to agree with Jean-Claude Juncker. After all, I tend not to see eye-to-eye with those who think the European Commission needs “to be an even more political body.”

But today, Juncker came out strong against Cameron’s proposed cap on EU migration to the UK; which is good, important even:

From The Telegraph:

Mr Juncker said: “I am not prepared to change [freedom of movement]. If we are destroying the freedom of movement other freedoms will fall. I am not willing to compromise.”

He said that any attempts to address the issue of the amount of benefits being claimed by foreigners would have to be in line with current EU treaties.

“Member states are free to take the initiatives they want as long as these initiatives are line with the treaties,” Mr Juncker said.

Here’s the problem – I don’t think I do agree with Juncker; in fact, I have a sneaking suspicion he and I hold the opinion that free movement in the EU should remain uncapped for fundamentally different reasons. I, for one, don’t think migration is complimented by mandates to ensure a universal ‘minimum social wage’ throughout the EU.

Rather, I see free movement as an integral and necessary component of UK economic prosperity, not to mention a huge benefit for communities that both migrants and natives come in inhabit.

Yet on this particular topic, Mr Juncker and I have the same end goal. And his commitment to protecting free movement—rejecting Cameron’s migration negotiations—has taken us another step towards a full-blown referendum in 2017. Such a referendum, described in the most positive light, would be an opportunity for Britons to discuss and debate the implications EU regulations have on the UK (the specifics of trade agreements and vacuum cleaner bans are two topics that immediately spring to mind…). But there is a deep worry on the part of pro-immigration advocates such as myself that many will use the referendum to lock migrants out of the UK as best they can.

The majority of Juncker’s policies fall short of promoting freedom and prosperity—but on migration, at least his end goals are right. And until UK politicians (all of them really, Conservatives and Labour across the board) stop trying to halt the overwhelming benefits migrants bring to the UK, I find myself in unfamiliar waters, with Mr Juncker as my ally.

‘Global Inequality as a Consequence of Human Diversity’

Over the past few days I read Tatu Vanhanen‘s new book, Global Inequality as a Consequence of Human Diversity published by the Ulster Institute for Social Research. Though I am broadly open to the arguments he makes therein, it is not a good book and I cannot recommend it. I have not read IQ and the Wealth of Nations the 2002 book he published with Richard Lynn, but I suspect the theses are very similar.

His argument runs that the existing explanations for the variation in living conditions between nations are either hard to falsify (like Jared Diamond’s and Jeffrey Sachs’), excessively narrative, explain too little of the variation, or beg the question (like Daron Acemoglu & James Robinson’s).

He advances an alternative explanation: since (a) human evolution has been recent and extensive enough to produce substantial morphological differences (consider how different Koreans, Somalians and Papua New Guineans look); and (b) we have a large literature suggesting that lots of traits, especially cognitive ability (measured well, he believes, by IQ) are substantially genetic, we shouldn’t assume all human populations are genetically similar in intelligence. Since we know that intelligence is important for social success within populations we should not be surprised if it controls success across populations.

Quoting Pilar Ossorio, he says:

According to contemporary geneticists, any two unrelated humans are about 99.8% or 99.9% genetically identical, but because ‘the human genome contains approximately 3bn nucleotides (DNA building blocks), a 0.1% or 0.2% difference translates into millions of sites at which two people will have a different nucleotide.’

He constructs an ‘Index of Global Inequality’ (IGI) out of six measures of societal success: gross national income at purchasing power parity; the share of the population in tertiary education; under-five mortality; life expectancy; sanitation facilities; and an index of democracy. He finds, with a simple regression, that around three quarters of a country’s IGI is explained by its average IQ. Further, most of the outliers have special explanations for why they depart from the curve, the biggest four being: oil, caribbean tourism, history of socialism and civil wars.

In and of itself, this argument is somewhat interesting and somewhat suggestive. What is surprising is that this is almost the entirety of the book, fairly laboriously spread over 170-odd pages. It makes almost no attempt to deal with the evidence against it. For example, it’s true that within Western groups IQ is highly heritable (i.e. most of the variation between individual is due to genetic factors) and largely unaffected by environment. It’s also true that within poorer societies a large fraction of IQ is down to genes, but this fraction is lower, because there are many more of the big downside factors that can really stunt cognitive development (principally malnutrition). And it’s much less clear that the difference in IQ across the world, where environments are extremely heterogeneous, are down to genetics.

It’s not that it’s impossible they are and there is rock solid evidence for the alternative. But Vanhanen doesn’t even attempt to provide evidence for his view that IQ is practically entirely genetic, even across strikingly different environments. One flaw of the book is that once he has stated that the evidence suggests IQ is mainly genetic within populations, he begins assuming the link between IQ and development across populations purely represents human diversity-caused differences, with only the unexplained residual environmental. This is not representative of the stronger stuff I’ve read in the area.

This leads into another puzzling issue with the book: the fact it fails to deal with any of this existing literature. There are better ways to test whether institutions, geography or human diversity is driving differences in development and he doesn’t really attempt any of them! For example, a 2011 paper found that effectively random variation in institutions had no effect on the economic outcomes of a given African ethnic group. The literature is large and the debate is still raging, and Vanhanen’s ‘side’ might end up being judged right, but his approach adds basically nothing to the question of whether IQ causes development or development causes IQ.

I suppose I can’t really blame the book for its cheapness, the relatively frequent typos, the ugly and unclear charts and tables, but these certainly reinforce the overall feeling of lightweight pointlessness you get when you read it. And I can’t stress enough the importance of human capital theorists being epistemically cautious in their claims, given how controversial their conclusions are. People, working on sound principles, often devalue a perspective when they hear a weak argument in its favour (‘if that’s the best they’ve got…’), and I think Vanhanen’s new book will only weaken the case for considering human diversity when looking at global inequality.

Yes, of course we’re being lied to, why do you ask?

We’re all wearily familiar with the ritual incantations that it’s those nasty multinationals that dodge taxes in developing countries and that therefore little babies die. This is not, despite the frequency of those incantations, actually true. The extremely impressive researcher, Maya Forstater, has rather more of the truth for us here:

Nevertheless if current estimates are best we have to go on, they should at least be communicated clearly. One thing that becomes clear once you take away all the showmanship of the killer facts is that the estimates commonly used are simply not that much money. Global numbers in billions are hard to comprehend, but we can make honest and clear efforts to make sense of them on a country-by-country basis. According to the data that ONE sent me (which uses PWC data on national tax rates to estimate the tax revenue losses associated with GFI illicit flows estimates) it looks like most countries where aid contributes a significant proportion of government budgets have estimated trade related tax losses in the region of 15% or less of aid receipts. Not nothing, but not the grand problem-solving amounts we are led to believe.

If you look at what this amounts to on a per capita basis (based on the ONE data and my calculations), Bangladesh could raise $2.77 extra tax for each of its citizens, Ethiopia $6.81, India $9.31and China $4.14. That is dollars; single dollars. Per person. Per year.

We thoroughly recommend reading her whole piece in full. Maya’s forte is to take these various reports from the various usual suspects and then drill down into the actual numbers and assumptions that they are making and test the veracity of them. An earlier success of hers was pointing out that estimates that Zambia had been diddled out of $10 billion in copper revenues was based on the pricing structure of 2 tonnes (yes, just two tonnes) of samples that had been sent out. Thus over-estimating the correct copper revenues by a factor of five (the very boring technical detail which I was able to help with subsequent to that article is that samples cost more than production lots. Largely because customs data on pricing (which is where the prices came from) includes the cost of transport in said customs pricing. So if you send someone 20 kg of copper as a sample through DHL the customs price for that 20 kg includes the DHL package costs. Which is, as we all know, rather higher per kg than the transport costs of 10,000 tonnes of copper on a ship).

It’s important for us to recognise all of this: and Forstater’s major point here is that these numbers we’re being fed about the impact of tax losses on developing countries simply are not true.

Unsurprising: Migrants give back to new communities (often more so than natives)

Migrants in high-income economies are more inclined to give to charity than native-born citizens, this Gallup poll finds.

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[High-income economies are referred to as "the North"/ middle- to low-income economies are referred to as "the South".]

 

From 2009-2011, 51% of migrants who moved to developed countries from other developed countries said they donated money to charity, whereas only 44% of native-born citizens claimed to donate. Even long-term immigrants (who had been in their country of residence for over five years) gave more money to charity than natives–an estimated 49%.

Even 34% of migrants moving from low-income countries to high-income countries said they gave money to charity in their new community – a lower percentage than long-term migrants and native-born citizens, but still a significant turn-out, given that most of these migrants will not have an immediate opportunity to earn large, disposable incomes. The poll also found that once migrants get settled, their giving only goes up.

Migrants seem to donate their time and money less when moving from one low-income country to another; though as Gallup points out, the traditional definitions of ‘charity’ cannot always be applied to developing countries, where aid and volunteerism often take place outside formal structures and appear as informal arrangements within communities instead.

It’s no surprise either that the Gallup concludes this:

Migrants’ proclivity toward giving back to their communities can benefit their adopted communities. Policymakers would be wise to find out ways to maintain this inclination to give as long as migrants remain in the country.

This is yet another piece of evidence that illustrates the benefits of immigration for society as a whole. (It also highlights the insanity of Cameron’s recent proposal to curb the number of Eurozone migrants coming to the UK). Not only does the UK need more immigrants “to avoid a massive debt crisis by 2050,” but apparently it needs them for a community morale boost as well.

Seumas Milne’s dodgy statistics on African poverty

Seumas Milne’s column last week blamed globalisation for migrant deaths in the Mediterranean. The column isn’t that important, but this bit jumped out at me:

As the catechism of “free market” deregulation has been imposed across the world under “free trade” and “partnership” agreements and the destructive discipline of the IMF, World Bank and WTO, capital and resources have been sucked out of the developing world and tens of millions of people have been driven into urban poverty by corporate land grabs.

That is why the number living on less than $2 a day in sub-Saharan Africa has doubled since 1981 under the sway of rich world globalisation. Africa’s boom has been in resource exploitation, not in most people’s living standards. So it is hardly surprising that migration from the global south to high and middle-income countries has more or less tripled over the past half century.

Actually, the percentage of people living on less than $2 a day in sub-Saharan African has fallen from 72.2 percent to 69.2 percent since 1981. The total number of people on $2 a day has doubled because sub-Saharan Africa’s population has doubled (p. 96). “Free market deregulation” has nothing to do with it, except for the fact that infant mortality has fallen substantially.

I know this because it is in the same paper that Mr Milne’s figure comes from, on the same page, in the same table. It’s a pity that he did not think to mention the data that directly disproves his claim.

Screen Shot 2014-10-16 at 09.25.27I wrote a letter to the Guardian pointing this out but they didn’t print it. It’s also worth pointing out that African poverty fell by 38% between 1990 and 2011. (h/t Anonymous Mugwump.)

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