They still depress wages, and they will take most of their wages back with them, where their families are, and the cost of living is lower. There have also been many reports of americans training their replacements, at which point the distinction to outsourcing disappears.

Finally, I take issue with your characterization of software engineers as 'high income' - as I understand it, compared to the cost of living, they don't make that much on average. But I would welcome statistics on this matter.

In that case, should we also avoid hiring American citizens who send money to family overseas?

I agree that this reduces wages of high income workers. That's exactly why it reduces income inequality.

There are essentially no statistics in the US which adjust income for cost of living. Do you criticize all income inequality arguments on this ground, or just this one?

>I agree that this reduces wages of high income workers. That's exactly why it reduces income inequality.

The majority of the money saved from those wages would be transferred to the managerial classes (execs, etc.) and shareholders, making income inequality worse:

http://www.forbes.com/2004/08/31/cx_da_0831topnews.html

Income inequality isn't high because people who work for a living are earning too much.

> In both cases, money is transferred from taxpayers to high income colocated workers who will presumably spend it in the economy.

Also, you're ignoring the national security implications of the thing. We cannot afford to be dependent on a foreign country for high tech skills. That's one reason why protectionism makes sense. As a country, we're willing to pay extra for certain basic manufacturing/services to stay in the county, such as aerospace repair and steel manufacturing, in case we ever become hostile with some other country.

That's both literally and figuratively backwards.

You're describing a scenario where the relationship between the countries becomes so hostile that we have to worry about what happens if one of us cuts off the flow of talent. But what we should really care about is making the flow of talent so voluminous and indispensable to both nations that relations cannot deteriorate to that point. That's real national security.

Right, until that other country elects an orange demagogue that utilizes popular discontent to demonize you and cut off that flow of talent, regardless of the mutually assured harm. Societies are fickle, especially in times of war or increasing tensions. A well maintained local talent pool and industrial capacity subsidized against foreign economic forces are not.

Relying on other nations is the exact opposite of national security and it's naive to think that they will be by our side when shit hits the fan. We've seen too much in the last hundred years to leave our most critical industries to chance.

The movement of labor and ideas also means that there is no shortage of educated people to speak out against said orange demagogue's terrible policies. And most peoples' postmortems of the election agree that the election was close enough that higher immigration (or even better distribution of existing immigrants) would likely have kept him out of office.

> higher immigration (or even better distribution of existing immigrants) would likely have kept him out of office.

Only importing immigrants who have political views that agree with yours? A country has a particular culture and set of views. Why would we want to import people from countries with inferior living conditions and follow the way they do things? There's a reason they left.

No, the presence of immigrants who have political views that disagree with me would be even better.

As for why let people in from poor countries, because we are siphoning off the most educated and ambitions people from that country, who bring their drive and good genes to our country. It's the same reason Asians, who consist of the top people in their home countries who chose to came here, do better in the US than blacks, who were brought here by slavers.

> As for why let people in from poor countries,

What part of the point "let people in from poor countries, but don't let them keep doing things the way they were doing them" is not clear? Sure they want to move here, don't let them turn this place into the place they left by making them learn the language and culture.

>It's the same reason Asians, who consist of the top people in their home countries who chose to came here

That is an incorrect statement. Most asians who first came to america were imported as cheap labor to compete against Irish unskilled labor. The Polish, Irish, and Italian who came to the states were definitely not the best and brightest, but because they assimilated and learned the culture prospered.

> But what we should really care about is making the flow of talent so voluminous and indispensable to both nations that relations cannot deteriorate to that point.

That has not happened in the history of mankind. Talent moving around is rather high on Maslov's hierarchy of needs. If your country is out of arable farmland, clean water, or minerals, you will start looking around for places to get those materials.

If they will not trade for them, generally you invade.

I would say that is because, in the past, "work remotely" wasn't a viable option. Today, that sounds like a much better option than a war of conquest. To me, at least.

> in the past, "work remotely" wasn't a viable option.

What does this have to do with anything? We're talking about resource wars. You can kidnap talent. Look at the origin of the term "shanghaied" and the British impressing American seamen.

> Today, that sounds like a much better option than a war of conquest.

You're not getting the point. Most nations can do without talent. Talent is willing to cross borders, depending on who's winning.

What nations cannot do without is food, minerals and water. Those are definitely zero sum games. Unless you're able to defend your goods with force or there is an abundance of them, they will be taken away from you.

> We are discussing hiring local workers, not outsourcing. The local workers just happen to be brown and born in a different place.

One distinction is that many immigrant workers will be sending money back to their family in their home country, resulting in a net drain on the economy in which they're working.

I'm not saying this is a good reason to make life harder for them, but I do think it's a fair point.

It's not that simple. An Indian expatriate's remittance may leave American shores, for example, but then re-enters when their family buys iPhones, Ford's and Hershey's.

As someone who sends back thousands of dollars a year to family in Russia and Lithuania: they're sure as hell not spending it on American products. They spend it on food, medicine, housing, and education which are all sourced locally except for a tiny fraction of products that can't be (mostly IP restricted things like medicine, textbooks, movies). Once in a while they'll buy a computer manufactured in China from an ostensibly American company that rarely repatriates their profits.

The problem is that most American exports are luxury goods (even in agriculture) and when you come from a poor country where a few hundred dollars makes a huge difference, those exports will account for a tiny amount of the capital sent there. There are many long tail benefits but I doubt they are quantifiable enough to say that the drain from remittances is anywhere near break even.

Edited to add: my family doesn't even need the money, despite having health conditions that would economically cripple someone in the US without the best insurance. Salary + pensions + free education and healthcare are enough to survive so most of the money I send them are to give them breathing room and spending money. I think half of what I send them gets spent on spoiling the younger family members and the rest goes into a rainy day account. The only time they "spend" on American products is when one of us in the US buys them iPads/iPhones (on top of the remittance) as gifts on one of our visits and they buy a $5 game twice a year for the kids to play.

That said, if Americans knew how much of the >$100 billion remittance market went to buying little kids books, candy bars, sports equipment, and board games, they'd think the money was worth all the happiness it brings.

>We are discussing hiring local workers, not outsourcing. The local workers just happen to be brown and born in a different place. > >The money will still be spent in your own economy.

In other words you are valuing the $128 billion US remittance market at $0.

In scheme 1, does the lowest bidding software engineer have the right to stay in the US if they don't have work? If not, maybe that's why they can be the lowest bidder. Any American born developer of minority descent isn't going to underbid to that level. So your preferred scheme allows the free flow of capital but not labor.