“There are a whole host of ways in which this immigration problem is having very real human consequences.”
WASHINGTON, D.C. – Senator JD Vance (R-OH) slammed immigration’s detrimental effect on the American economy and its workers in a Senate Banking Committee hearing with Federal Reserve Chairman Jerome Powell. Senator Vance highlighted the the causal role of immigration in the further tightening of the housing market, labor market, and the hindering of American wage growth. Senator Vance also cites a recent letter from the city manager of of Springfield, Ohio, addressed to the Senate Banking Committee, detailing the city’s housing crisis due to an influx of migrants.
Watch Senator Vance’s remarks here and read excerpts below.
Senator Vance cites concerns raised by Federal Reserve Governor Miki Bowman:
“I want to ask something I imagine most my colleagues are not asking, which is the relationship between immigration, particularly extremely high illegal immigration levels under the Biden administration, and the persistence of the inflation problem…
“I want to read you a quote from Miki Bowman, who is one of your [fellow Federal Reserve] governors, and this says, and I quote: ‘There is a risk that increased immigration and continued labor market tightness could lead to persistently high core services inflation. Given the current low inventory of affordable housing, the inflow of new immigrants in some geographic areas could result in upward pressure on rents, as additional housing supply may take time to materialize. With labor markets remaining tight, wage growth has been elevated at around or above 4%, still higher than the pace consistent with our 2% inflation goal, given trend productivity growth.’”
Senator Vance on immigration’s massive impact on Springfield, Ohio and other small communities:
“A letter for the record from the City of Springfield in our state, the southwestern part of our state, which I think highlights a very real example of this particular concern, straight from the horse’s mouth itself. This letter, I want to quote from it: ‘Springfield has seen a surge in population through immigration that has significantly impacted our ability as a community to produce enough housing opportunities for all. Springfield’s Haitian population has increased 15 to 20,000 over the last four years in a community of under 60,000 previous residents, putting a significant strain on our resources and ability to provide ample housing for all of our residents.’ End quote there.
“In my conversations with folks in Springfield, it’s not just housing. They’re trying to build 5000 new housing units, which is a very Herculean task in a town of about 55,000 people, but it’s also hospital services, it’s school services. There are a whole host of ways in which this immigration problem, I think, is having very real human consequences.”
Senator Vance on immigration lowering the wages of American workers:
“One of the euphemistic ways in which economists I think sometimes talk about labor supply and immigration is they’ll say something to the effect of, ‘Well, an increase in labor supply has put downward pressure on labor prices,’ and what they’re effectively saying is that increased immigration has put downward pressure on the wages of American workers.
“I wonder, when you hear your colleagues and other economists outside of the Fed talk about the influx of immigration and the fact that it admittedly has put downward pressure on wages, obviously that has put some downward pressure on inflation, but it also puts downward pressure on the wages that people earn to pay for their families.
“Why do we see that as a good thing? Or maybe that’s wrong, maybe that premise is fundamentally incorrect. But why do so many economists treat an influx of new labor as a good thing? If labor is constrained, labor supply is constrained, doesn’t that lead to rising wages for American workers?”
Senator Vance on filling American jobs with American workers instead of immigrants:
“If we say we have a really tight labor market and we say that there are more than one job openings per worker, there are two ways you could plausibly solve that, probably more than that, but two obvious ways you can plausibly solve that.
“One is through a new influx of workers via the immigration system. Another way is by raising wages and bringing some of the workers that are on the sidelines. I think specifically of the 7 million prime age men that have dropped out of the labor force. Why isn’t that more the focus of policy makers rather than – you see labor shortage, rather than bringing in a large number of new immigrants, why not try to boost wages in a way that brings some of those workers off the sidelines?”
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