Immigration Undermines Social Trust, Part III: Mass Immigration Undermines the Free Market

By Darrell Dow

In prior essays I’ve argued that mass immigration breaks down community, undermining social trust and giving rise to the Nanny State.  In this brief post I want to discuss some implications of open immigration for the operation of markets.

Does a philosophical commitment to open markets and freedom of association necessitate a similar commitment to open immigration?  Some libertarians answer the query with an emphatic negative.  Hans Hoppe has written in defense of free trade and largely closed immigration.  Hoppe follows in the tradition of Murray Rothbard who, late in life, concluded that open immigration is an assault on property rights and undermines ethnic and national identity.  Lew Rockwell and Tom Woods also oppose open immigration.  All of the above are disciples of Austrian economist Ludwig von Mises and many interacted with Paleo-Conservatives in the 1990s during the Buchanan campaigns. 

Intuitively a theory of international trade is similar to the movement of persons.  Free trade seems to assume the free movement of labor.  But on a practical level, it can reasonably be argued that free trade operates as a substitute for immigration.  Theoretically one could have factories in Mexico rather than Mexicans in the United States.  Imperial Britain employed a policy of “splendid isolation” from Europe and combined free trade with almost no immigration.  In short, though I personally favor protectionist trade measures I am not arguing that the issues are connected in an iron-clad way.  Immigration restrictionists should welcome free-traders into the tent.

However, the majority report among libertarians and free-trade zealots in the Wall Street Journal orbit ties the open movement of goods and people together logically.  As far back as 1984, WSJ editor Bob Bartley offered a five-word constitutional amendment: “There shall be open borders.” Another libertarian, Tom Lehman, writing for the Foundation for Economic Education, argued that open immigration is merely a corollary of free trade:

“Immigration policy should not be viewed differently than trade policy: free, unregulated, unpoliced, open borders, devoid of taxes, tariffs, or any other barrier to entry. This is the policy of freedom to which America owes her heritage. Unilateral free trade, free immigration, and free emigration, where individuals possess unobstructed and unregulated mobility and trade, is a cornerstone of a free society. In fact, the free movement of peoples is no less important than the freedoms of speech, expression, and association. Liberty is indivisible; the laws of economics apply equally to all peoples.”

Open borders are a moral issue, “the cornerstone of a free society” and as important as freedoms of association or worship because “liberty is indivisible”, says Lehman.  The magical laws of economics “apply equally to all peoples.”

Also writing for FEE, David Boudreaux makes a moral case for immigration:

“Whether or not immigrants increase or decrease measured GDP or per-capita income is an empirical question that can be answered only by sound empirical research. (Economist Julian Simon has carried out much of this research; he finds that immigrants promote prosperity.) But the moral case for open immigration is paramount. That case is this: a geopolitical border is a grotesquely arbitrary reason to prevent people from dealing with each other in whatever peaceful ways they choose. “

Channeling John Lennon or Simon & Garfunkel, Boudreuaux says that borders are merely “arbitrary”? The apostle Paul and St. Luke would beg to differ.  In Acts we read that borders are ordained and appointed by God (Acts 17:26).  Then again, what does God have to do with economic ethics?

Lehman also dismisses those who’ve jumped to the wildly inappropriate, ridiculous conclusion that mass immigration could undermine the cultural preconditions of a free economy:

“Contrary to the anti-immigration position, the American traditions of limited government and free market economies are not based upon ethnic or racial origins. They are based upon ideas. Western cultures cannot suppose themselves to have a monopoly on the philosophy of liberty, nor can Americans argue that the political values of the limited state cannot be inculcated in non-American immigrants. The ideas of freedom that have created the American tradition can apply to any ethnic or racial make-up.”

Take note of the universalist and egalitarian presuppositions assumed by Boudreuaux and Lehman.  In their view the free market is merely a universal abstraction or idea, written on the very heart of every man, divorced from ethnic or cultural considerations. One group of people can embrace it as readily as another. All that is needed is a ready supply of copies of “The Wealth of Nations” and the free market will spring fully formed like Athena from the head of Zeus.

How are intelligent men able to accept such folly? Markets are produced by particular cultures and are part of a broader social order.  To quote Peter Brimelow, “The free market necessarily exists within a social framework. And it can function only if the institutions in that framework are appropriate. For example, a defined system of private property is now widely agreed to be one essential precondition. Economists have a word for these preconditions: the ‘metamarket.’ Some degree of ethnic and cultural coherence may be among them. Thus immigration may be a metamarket issue.”

Even an immigration enthusiast like Milton Friedman could see, though not grasp entirely, the issue. In an interview with Brimelow, Friedman said, “It’s a curious fact that capitalism developed and has really come to fruition in the English-speaking world. It hasn’t really made the same progress even in Europe–certainly not in France, for instance. I don’t know why this is so, but the fact has to be admitted.” If the esteemed Dr. Friedman was confused, let me provide an answer–culture matters; and mass immigration, the replacement of one people by another, necessarily undermines the cultural preconditions that make free markets possible. As Thomas Sowell has written, “The most obvious fact about the history of racial and ethnic groups. Is how different they have been–and still are.”

Among other problems, a diverse population increases “transaction costs.”  Dealing with people who you don’t know and share little in common with or don’t trust yields the need for expensive precautions, laws, and regulations.  It increases the cost of doing business.

Secondarily, capitalism generates inequality and therefore envy.  Sowell has demonstrated throughout his work that cultural differences are persistent and pervasive for generations.  Various ethnic groups—Chinese, Jews, Japanese, Germans—excel wherever they live.  But because face-to-face relationships are comparatively more comprehensible than those of an impersonal nature, the “losers” in economic transactions are far more likely to employ the state as a means of “leveling” the playing field—and this is especially the case when the winners have alien characteristics.  In short, the economics and politics of envy intensifies in a multicultural milieu.


About Darrell Dow

I am first and foremost a sinner saved by grace. A disciple of Jesus Christ, I'm Reformed theologically, a recovering Baptist, and a paleoconservative politically.
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8 Responses to Immigration Undermines Social Trust, Part III: Mass Immigration Undermines the Free Market

  1. weavercht says:

    Well, free trade is of course not free trade, today. Every important trading partner of the US uses border adjusted VAT. And the Rockwell libertarians are all fine with that. If the economy is dismantled, well it won’t be able to support the American military.

    Friedrich List is the guy to read to learn about trade. Britain pursued free trade when advantageous. And it sought to prevent its colonies from developing, to ensure production was retained in Britain.

    The purpose of trade is to concentrate power (productive ability and technological ability) and wealth generating worker productivity within the state while also ensuring the existence of reliable supply. You ideally want to trade manufactured goods for raw materials, which are finite and expected to be less rewarding to produce.

    Libertarian free trade, as List pointed out, is really globalism. You need a global state to ensure free trade.

    Just to tack a quote, Sam Francis called free trade, “economic ethnic cleansing”. And as Paul Craig Roberts warned, the research jobs tend to follow the manufacturing.

    Asia trades with the US just so long as its in their state and elite advantage. When no longer advantageous, Asia will just go its own way. If an Asian state obtains a technological and productive advantage, it is likely to seek to retain that advantage.


  2. Ben Carmack says:


    Glad to see you posting here. Your thoughts on immigration’s cultural impact are illuminating.

    I’d like to leave a link to Lawrence Auster’s essay The Path to National Suicide. In many ways, it paved the way for the modern day immigration restruction movement.

    It’s also worth noting, that while most on the paleo right were seeking to appease the Islamic world, Auster was arguing for restrictions on Islamic immigration before it became vogue to do so.


    • Darrell Dow says:

      Thanks, Ben. I read that Auster essay years ago. Great stuff. I didn’t always agree with Auster, but he was a voice of sanity.


  3. weavercht says:

    The problem with capitalism is it trends towards a large, complex society, which inevitably becomes a leviathan. And it seeks expansion, beyond nation-state boundaries.

    Capitalism wants interchangeable cogs, human resources. Capitalism is potentially an enemy to nation, faith, clan, tribe, extended family. These group ties make relocation of human resources complicated. Capitalism demands a nuclear family that can be relocated at will, an unrooted, propertyless proletariat. And it doesn’t want there to be any trouble when relocating Arab cog #364 to China sector #4. This is perhaps fine if capitalism can be contained within a national boundary, but what when it breaks free into the international realm? Then you simply have a repeat of the same destruction we see today. Additionally, capitalism wants cheap immigrant labour.

    The successful in a capitalist society are the ambitious but unquestioning sheep, not the intelligent, honest entrepreneur that right-libertarians dream. It is advantageous in this society to respect the powers-that-be, not to upset them. Look at who supports Hillary: The wealthy and powerful. This is not entirely because of corruption. Those who are successful cogs in the US machine hold certain values. They don’t question the machine. They tend to believe in our founding myths of modern society. They are not conservatives.

    Additionally, the successful in our society tend to be parasites who put profit ahead of the greater good. And this great power derived from the concentrated wealth is used to influence society towards expanded profit. And similarly bureaucrats in big business and big government tend to wish to expand society’s reliance on them and their own influence and power.

    The average citizen tolerates wealth inequality in part because his lot is improving. Currently in our society today, this is not the case. And we see large numbers who possess nothing. They are totally at the mercy of employers and the state, living pay check to pay check, wholly vulnerable, like slaves. It’s no wonder that so many join left wing movements. So, it does seem natural to expect that most any capitalist society will eventually reach its next phase: socialism, which is a return to slavery.

    So, in short, to preserve the permanent things, to resist slavery, it’s my belief capitalism must be rejected.


    • Darrell Dow says:

      In general terms I try to make a distinction between a generally free market and ideological capitalism. That “Capitalism is potentially an enemy to nation, faith, clan, tribe, extended family” is clearly the case.

      I tend to see immigration as the political issue. I am willing to make common cause with those that don’t share my general worldview kneejerks (e.g., libertarians, population control lefties, etc.) if they are serious about immigration control. My point is that I don’t want to write people off merely because of a dispute over trade policy.

      Regarding List and the subject of trade more generally, I nod in ascent. In the 1990s, Paleo-Conservatives and Paleo-Libertarians tried to form an alliance but it fundamentally broke down over that particular issue.


      • Darrell Dow says:

        My preference is for a social order that is more agrarian. I am more sympathetic to Distriubtism, Ropke, Berry, Tolkien, and southerners like Davidson. But I also don’t think I’m the guy who should necessarily be writing an apology for their worldview. I’m sticking to what I know.


  4. weavercht says:

    I don’t mean to post as hostile, btw. I visited with the intention of “supporting” the site.

    And I just was compelled to reply in the hope that either an argument of mine was rejected or accepted.

    Just to add a point though:

    English libertarians tend to assume it is English who thrive in diverse classically liberal societies. They tend to believe honest, hardworking Englishmen will naturally rise to the top, rewarded for their contribution to their nation, even that they naturally hold these ideas. Yet, we see in truth it is Jews who rule over the English. And again, capitalism seems more of a pirate ethos, not something that rewards the “good”. And I’m not writing against Jews, only pointing out how odd the English classical liberals are. At least one of my points should break through, should they be read.

    I like libertarians when they’re incapable of coming further to the right; they’re frequently politically allies, respectable and convenient for me to hide behind. But I wish right-libertarians would abandon the market god.


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