Pie Fight

Why do Koreans own foodstores in black neighbourhoods?

Why don't blacks own them? Here's the first sensible answer I've ever seen. Excellent stuff.

A number of folks commented on Mike's post about Andrew Young, essentially asking why African-Americans don't run corner stores and coffee shops. I don't know much about coffee shops, but let's take three categories of small businesses that immigrants tend to concentrate on: corner shops, dry cleaners, and doughnut shops. What do all these have in common? First, they are very low margin enterprises. They are only profitable if you can drive hourly wages down very low. This is possible if you engage in what I call (and refer to in my co-edited book called Ethnicity, Social Mobility and Public Policy in the US and UK, available to your left) "self-exploitation." These are enterprises that work mainly if you can make yourself and your family the labor pool, and make up for low average hourly wages with extremely long hours, both on the part of the owner and their family (whose labor is not directly compensated and not taxed). These type of enterprises don't work for African-Americans for two reasons. First, their reserve wage is above the (very low) effective hourly wage that these enterprises provide. Second, given their family structure, most African-Americans don't have recourse to uncompensated family labor. There's also a third factor, which is access to capital--many of these enterprises are originally capitalized through rotating capital arrangements, which depend on the high level of social trust that comes from fairly tight-knit immigrant communities. A more speculative fourth factor is that these enterprises often work because consumption among the relevant immigrant groups is often highly suppressed--closer to the level of their countries of origin than the US norm.

One way of summing up the reason that African-Americans aren't found in substantial numbers in these sorts of niches is that they are so thoroughly assimilated, in their expectations of return on labor, family structure, individualism, consumption patterns, etc. One doesn't need to explain the phenomenon under examination by recourse to the peculiar character of African-Americans--in fact, it is the phenomenon of low-margin immigrant businesses that has more of a cultural grounding. This can be seen in the fact that very few second-generation immigrants are found in such jobs. They "work" in providing an economic bridge into the American market economy, but they are almost always transitional--the second generation moves into the mainstream economy, typically through education. This is true both in Britain and the United States.

This is a very compacted version of a highly complicated story. Those interested in the details would be well-advised to take a look at the book, available here.

Immigration v social spending

Just glancing quikcly at this julian sanchez post on how America is comfortable accpeting more immigrants because it has a smaller welfare state, it looks like utter (and under-researched) bollocks. No time to read it now, but i'll definitely have a look before writing my diversity v social spending paper.

A drop in the bucket immigration blues

Drum and Drezner discuss an article that argues - convincingly - that immigrants don't depress low-skilled natives' wages as much as common sense says they do:

California may seem the best place to study the impact of illegal immigration on the prospects of American workers. Hordes of immigrants rushed into the state in the last 25 years, competing for jobs with the least educated among the native population. The wages of high school dropouts in California fell 17 percent from 1980 to 2004.

But before concluding that immigrants are undercutting the wages of the least fortunate Americans, perhaps one should consider Ohio. Unlike California, Ohio remains mostly free of illegal immigrants. And what happened to the wages of Ohio's high school dropouts from 1980 to 2004? They fell 31 percent.

Strength in diversity?

I'm thinking of writing something on the impact of ethnic diversity on the public commitment to the welfare state. My question, if I had to pop one out right now, would be to ask is ethnic diversity bad for national commitment to a strong welfare state, or is inequality more likely to prove a stumbling block. What makes someone "other" - being a different colour, or being poor and needy? (It would also be worth looking at this from a housing perspective, because this is the coal face where many of the frustrations are sewn and many emotional battles fought.)

I've posted once before on the David Goodhart flap (here's his article), but here are a few other links.

This defunct blog has a decent summary of the flaws in Goodhart's argument.

Goodhart begins by offering readers the "progressive dilemma" (from the mouth of Tory MP David Willetts):

"If values become more diverse, if lifestyles become more differentiated, then it becomes more difficult to sustain the legitimacy of a universal risk-pooling welfare state. People ask: 'Why should I pay for them when they are doing things that I wouldn't do?' This is America versus Sweden. You can have a Swedish welfare state provided that you are a homogeneous society with intensely shared values. In the United States you have a very diverse, individualistic society where people feel fewer obligations to fellow citizens. Progressives want diversity, but they thereby undermine part of the moral consensus on which a large welfare state rests."

His argument, simplified: a large welfare state relies on a homogenous population. Progressives want to accept cultural diversity but citizens do not want the welfare state to support people they do not identify with. How do you solve the problem?

Goodhart's premise rests upon the concept that people like to keep to their own. In terms of the state, this means they much prefer to contribute to the welfare of people who are recognisable in terms of values. It brushes aside any notion of empathy or liberal "live and let live" attitudes in favour of a more Nimby-ish outlook, but there is a resonance there.

To support his solutions, Goodhart first presents us with two differing examples, America and Sweden. One has a relatively small welfare state but a diverse population. The other has a relatively homogenous culture but a huge and supportive welfare system. Where does Britain fit into this? Well, Goodheart suggests that a commitment to diversity suggests we are striving to be America - but his own figures go some way to disputing that context. Britain's ethnic minority population of 9% is actually superceded by Sweden, where 12% of citizens are foreign-born. But our welfare state cannot cope with diversity, he tells us.

Ultimately what Goodhart seems concerned with is the decline of "Britishness". America is very American. Sweden is very Swedish. But Goodhart, and others further to the right who decry immigration more wholeheartedly, worry that Britain is under threat of losing what makes it quintessentially British.

Unfortunately, Goodhart assumes that the only reason for a diversifying of the culture is immigration. This seems to ignore social movements such as feminism and gay activism, which both undermine Britain's traditional WASPish patriachal society - as well as skimming over internal religious diversity. If Britain is informed by protestant values, how does Catholicism, which owes its allegiance to the Vatican, fit in? These things are just as threatening to "Britishness".

For what it's worth, here's something from Harry's Place.

This reads to me that if Britain, like the US, finds itself in the situation where the majority of the poor are non-whites, the white majority will not want to sustain a welfare system to benefit the "others". Or in other words hostility to immigrants eventually will become a threat to the notion of universal public provision.

The problem is that while this difference may (or may not) adequately explain why the US did not develop into a European-style social democracy, it doesn't necessarily follow that already existing welfare states cannot survive in an era of greater diversity.

But there is certainly plenty of evidence already of some sort of linkage between race and welfare in the minds of some. In the Lancashire community I grew up in it was widely assumed that immigrants were 'on the fiddle' when it came to housing benefit and unemployment benefit and that in some way they received preferential treatment from the Health Service. The development Goodhart fears, that there will become a corrosive sense of "we" are providing for "them", was and still is widespread.

But the crucial question is - is there any indication that this has led to a weakening in support for the welfare provisions themselves? I think not. Such attitudes may be reflected in the support for far-right parties, a rising in racial tension and hostility to some local councils but I don't see much evidence of a direct link to opposition to a welfare state.

And here's another one, arguing against big bad multiculturalism. My problem with these arguments about multiculturalism is that they seem to assume that if you don't force peopel to integrate somewhat, most won't. But is there any evidence for that?

Dad burn immuhgints

Fistful has a good discussion of immigration, population and fertility rates.

The big payback

According to a study by the Institute for Public Policy Research, immigrants are better for the British economy than native-born Brits are.

The report shows that while the migrant workforce makes up 8.7% of the population, it contributes 10.2% of all income tax collected.

Perhaps surprisingly, migrants earn about 15% more per week than do British-born workers - which is probably a combination of being in skilled positions for some, and working 90 hours a week for many of those who don't. The average migrant wage is £405.83 per week, compared with £355.06 for non-migrants.

One thing the study points out is that in years when the budget is in deficit, as it was last year, people cost the government money rather than making money for it. (It's the reverse when the budget is in surplus.) In 2003-04, the average immigrant generated £7,203 in gov't revenue, while "costing" £7,277.

In contrast, natives generated only £6,861 on average, while costing a whopping £7,753. That means that last year, natives cost the country an average of £818 more per person than did immigrants.

I've only read the Guardian extract so far, so don't yet understand if this is a comparison of all migrants and natives, or workers only.

Racism, football and Europ

Somebody kicked a soccer ball, and it landed in the offices at Tapped. Actually, it landed at the WaPo, which has an article on racist chanting and violence in European football matches.

It's a  serious issue, I think, and one that hasn't been addressed before. Is 21st century Muslim immigration into Europe basically the same kettle of fish as was 20th century Southern European and Jewish immigration into the US? On the one hand, I believe that the media always has a tendency to see the current crisis as unique from previous ones, or - more commonly - to forget that there were crises back in "the good old day". My hope is that this is the case right now, and that after a few generations, Muslim immigrants will fit into European culture - assimilating a bit, contributing new things too - as well as Europeans and Russian Jews did into the US.

But I don't know. Will have to give this one some thought.

How much of a good thing?

From the Independent, an interesting take on viable population levels:

Sir: Messrs Standing and Martin (letters, 30 September) could do with a crash course in applied economics during which they would analyse population theory.

The optimum population in a country is defined with relation to the standard of living and not to the numbers of inhabitants. If the standard of living rises as the population increases then the country was in an under-populated situation. If the standard of living falls when the population increases then the country was in an over-populated situation. A sparsely occupied area such as a desert might be over-populated, whereas a densely populated area like London might be under-populated if a further increase in population brought about a rise in standard of living.

There are many parts of the world where a decrease in the population would result in a better standard of living for the remainder, and often strenuous efforts are made to bring about a reduction of population. Britain is under-populated, simply because our relatively large number of immigrants are doing the kind of work the natives find unattractive at pay rates that are likewise, thus helping to raise the standard of living for all.

I hope I live to see the day when the population of Britain reaches 100 million, and the more immigrants that can integrate with our society the better.

J A RUSSELL
Cheshunt, Hertfordshire

We're all British here?

Reflections by an American who just got her British citzenship.

Green card limbo

It was so much easier for me.

I wonder what's going on with the INS. My suspicion is that they've simply been told to fuck people about in order to let the world know we're serious about not letting terrorists in.

You show 'em, boys!