Furthermore, it would be illegal for a Wal-Mart University or a Wal-Mart hospital to explicitly bring hire foreign professors or doctors because they are willing to work for much lower wages than their U.S. born (or greencard holding) counterparts. Under the law, these institutions must first try to hire U.S. citizens before they can seek out foreign professionals.

With regards to universities, this is a bit disingenuous. It is trivial to bring in foreign academics, provided you can get the visa for them. All you have to do is to show that they are a leader in their area of specialty and so there is no domestic competition. Define their specialty as a small enough niche and this becomes a tautology. Universities do this regularly.

Disingenuous with respect to physicians, too. 25% of newly licensed U.S. physicians are foreign medical graduates. For some reason, when working in the U.S., they want to be paid at wages that are consistent with other American professionals. I suspect that if you told all of those (mostly) Philippino, Indian, Pakistani, etc. MDs that they were going to be paid at the same rate as their home country colleagues, while paying for housing, food, power, and what have you at U.S. rates, they'd all pack up and head on home. While they would be paid less at home, they would still be paid substantially more than other wage earners and would be living a comparatively comfortable lifestyle.

In order for a foreign born MD to be licensed in the US, he or she has to pass the licensing exams that all US MDs pass and serve a one year residency in most states (two years in a few states). In order for a foreign born MD to be licensed in the EU, he or she has to jump through roughly the same hoops. Not all residency slots are filled every year and it is relatively easy for a foreign trained MD to work in the US.

sorry folks, it isn't disingenuous with respect to either university faculty or physicians. In both cases, it is illegal -- as in you could go to jail -- to explicitly bring in foreign professionals with the purpose of getting lower cost labor.

It is touching that people are smart enough to figure out ways in which this can be done, but the fact is that businesses will not invest tens or hundreds of billions of dollars to set up Wal-Mart Universities or Wal-Mart hospitals if their business can be shut down and they can go to jail. As conservatives repeatedly remind us, business owners need to constantly have their hands held. They respond negatively to a bad business environment, and certainly the threat of fines and jail is a bad business environment.

If Wal-Mart and other companies had the same rules for buying foreign shoes and toys then we would have far more domestic production of both. If just 25 percent of our apparel came from abroad, it would roughly triple domestic employment in apparel.

It is remarkable that people don't recognize legal prohibitions and the threats of fines and jail as protectionist barriers.

"and even newspapers"

What, you mean like American economists writing for UK newspapers and taking the bread from the mouths of starving English freelancers?

Or, to be fair, English freelancers filing copy over the internet to American publishers?

The logic of this argument is so obvious. I don't understand how people can not get this. Increase supply and wages will fall. Aggressively knocking down barriers for low wage jobs, while limiting the number of high skill H1-B visa workers entering the country is a little unfair.

And refusing to enforce the border allowing millions of Mexicans to compete in the market for unskilled labor doesn't help either.

If the H-1B cap was lifted up to 2 million per year, I'm pretty sure those slots would be filled. Businesses are constantly lobbying congress to increase the cap.

I don't know if there are any legal barriers to bringing in foreigners to be corporate executives, but anyway the disparity in compensation of executives between US and foreign companies demonstrates that the level of compensation of US executives is not the result of a free market.

It would be "fair" to offshore or admit professionals as well as the unskilled. And it would result in lower costs for health care for poor Americans compared to what they pay now. (Although many have those bills payed by Medicaid.)

But the real wealth gap is between those who own stock and those who do not. The way to reduce that gap is to reduce immigration of both types of labor so that higher wages must be paid due to the smaller supply of labor; and to somehow reduce the export of capital.

This may (or may not) reduce the absolute average wealth in the US, but it will greatly increase happiness in the US.

Raising the limit or limiting the cap is not what Dean is getting at. The real problem is that there are institutions in place that prevent people from practicing in this country. It does no good to raise the limits on H1-b, for example, if, as a doctor educated and trained in Mexico, I cannot get a job working in the US as a doctor. It is far better to have clear standards that can be met and certified. Only then can we talk about immigration, which is a far thornier issue than just raising the cap in one category. Allowing immigration based on class (or expected class depending on wages paid in the sector in which the immigrant will work) would be exceedingly difficult to manage. Opening the doors to all would mean a swamping of the lowest wage earners. Perhaps a lottery is best, as long as the immigrant can work in their desired profession.

J Bean: 25% of newly licensed U.S. physicians are foreign medical graduates.

"Foreign medical graduates" is a vague term. My best guess is that you mean graduates of foreign schools. Irrelevant, since many Americans graduate from foreign medical schools.

For some reason, when working in the U.S., they want to be paid at wages that are consistent with other American professionals.

Irrelevant, since American wages are not fixed. Increase the labor supply and the price will decrease.

I suspect that if you told all of those (mostly) Philippino, Indian, Pakistani, etc. MDs that they were going to be paid at the same rate as their home country colleagues, while paying for housing, food, power, and what have you at U.S. rates, they'd all pack up and head on home.

Irrelevant - doctors practicing in the US could be paid less than they are now and still have a higher standard of living than doctors in the countries you mention.

In order for a foreign born MD to be licensed in the US, he or she has to pass the licensing exams that all US MDs pass

Yet there has been little or no effort to internationally standardize these tests, so that you could pass them in one country and use the credentials elsewhere. This is in stark contrast to, for example, product safety standards. Internationally "harmonizing" them has been an explicit and important part of many trade agreements.

While having to take US medical exams may not be an insurmountable barrier, it's still a barrier, and wouldn't be tolerated in many other fields.

and serve a one year residency in most states (two years in a few states).

An even bigger unnecessary barrier than the exams.

In order for a foreign born MD to be licensed in the EU, he or she has to jump through roughly the same hoops.

Just because Europe does it, doesn't mean it's not protectionist for the US to do so. In many areas, Europe is notoriously protectionist.

alex wrote, While having to take US medical exams may not be an insurmountable barrier, it's still a barrier, and wouldn't be tolerated in many other fields.

IIRC they made it harder to deal with the exam by offering it less frequently and in fewer places in the US.

My impression is that, regarding residencies, if you did a residency in another country, you can't just be examined and get qualified here---you have to repeat the whole damn residency.

Robert Hume wrote, But the real wealth gap is between those who own stock and those who do not.

No, the real wealth gap is between those who own land and other economic rent-generating assets and those who don't.

I think you're 100% correct. And as I try to bug Brad DeLong whenever I get a chance to post about it, why do Free Trade Economics Professors keep their tenure? Isn't tenure completely antithetical to their arguments? Wouldn't their students be served better with econ professors that operated in a free market environment?

Actually, NAFTA has explicit provisions to allow certain professionals to get jobs in the three countries easily. I discovered this recently when I started to look for a professional librarian job in Canada and learned that it would be no significant problem for my potential employer because NAFTA has librarians on a special list, which by the way also includes all kinds of teachers, including university ones. The complete list is at: http://www.nafta-sec-alena.org/DefaultSite/index_e.aspx?DetailID=167#Ap1603.D.1
Now, "Canada and Mexico" is not the same as including all of the rest of the world, but it's a start. And I have no idea if this is having any impact on librarians' salaries in any of the countries.