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“Immigration is the greatest anti-poverty program ever devised”, says Canadian-born economist Alex Tabarrok

Why the solution to Canada’s low population growth is more immigration

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BlackBerry co-founder Mike Lazaridis immigrated to Canada with his family from Istanbul, Turkey.

BlackBerry co-founder Mike Lazaridis immigrated to Canada with his family from Istanbul, Turkey.

An article today in the Huffington Post by economist Salman Sakir points out that Canada is one of many advanced nations that is suffering from low population growth.

The OECD expects that Canada will see the percentage of its population under the age of 15 decline from 16.5% to 15.6% between 2010 and 2050. This, says, Sakir will have numerous social and economic implications that could put a permanent halt to our growth.

For a glimpse into the future, one need look no further than Japan, where an aging population has stalled the country’s once miraculous economy to the point where it will probably never recover.

Political economist Nicholas Eberstadt notes that by 2040 the number of people over 100 in Japan will equal the number of newborn babies, a nugget of information that reveals the already dire situation that the country’s demographics have dragged it into.

“Thanks in part to its approach to financing programs for the aged, Japan already has the highest ratio of gross public debt to gross domestic product (well over 200 percent) of the developed nations,” says Eberstadt. “Projections by researchers at the Bank for International Settlements imply that this ratio could rise to a mind-boggling 600 percent by 2040. (Greece’s public debt, by contrast, amounted to about 130 percent of its GDP at the start of its current default drama.) While Japan might well be able to service such a mountain of debt without risk of sovereign default (assuming the country’s low-interest-rate environment continues to hold), it is hard to see how a recipe for rapid or even moderate economic growth could be cooked up with these ingredients.”

Eberstadt, writing in the Wilson Quarterly, says one of the main factors for Japan’s quandary is “unusually strong aversion to immigration”. This, I argue, is the most important single thing we can affect to curb Canada’s low growth problem. At a time when we are facing down a clear threat to our long term economic future we shouldn’t be making it harder to become a Canadian citizen, as things like Bill C-24 (AKA the “Strengthening Canadian Citizenship Act”) would seem to do. We should, with certain caveats, be making it easier.

“Immigration is the greatest anti-poverty program ever devised” -Canadian-born economist Alex Tabarrok

“Immigration is the greatest anti-poverty program ever devised,” says Canadian-born economist Alex Tabarrok, co-author of the highly-regarded economics blog Marginal Revolution. Tabarrok was co-author of the 2006 “Open Letter on Immigration”, which was addressed to then President George W. Bush and all Members of Congress. The letter, which was co-signed by more than 500 economists, laid out the case that immigration was not a burden but a benefit to Americans.

“Immigrants do not take American jobs. The American economy can create as many jobs as there are workers willing to work so long as labor markets remain free, flexible and open to all workers on an equal basis,” explained the letter.

In 2013, Tabarrok addressed Canada’s increasingly restrictive views on immigration in an interview with the CBC.

“It’s really a great shame that Canada, which has been historically quite open to immigration, is thinking about tightening, ” he said. “Immigration is one of the great things that one can do for the world. It’s good for Canadians and it’s incredibly good for immigrants.”

But what about the idea that opening up the Canadian border to anyone and everyone create a free-for-all that would overwhelm our social programs? Tabarrok says there is an easy fix to that.

“If people are worried about the burden on the systems, with immigrants going on welfare, the solution is not to prevent them from moving around. The solution is to say that immigrants are not able to go on welfare.”

From my perspective, as someone who covers the world of technology, it’s hard to understand any hint of xenophobia here when so many of the great contributions to our country have been made by immigrants. And I’m not talking about the days of Alexander Graham Bell.

Terry Matthews came from Wales in the 1960’s and is almost singularly responsible for making Ottawa a technology hub. Mike Lazaridis came from Istanbul when he was five years old and the result is Canada is the birthplace of the smartphone. Prem Watsa left India with eight dollars in his pocket and has become an investor of worldwide renown and one of our great philanthropists. It’s hard for me to imagine a Canada without these three gentlemen and so many more who are shaping our economy today.

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