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You have just nailed it. I used to work construction in western North Carolina. The large crews paid far, far less than the crew I worked on. Nobody who didn't live in a home where all the bedrooms were shared could make a living on the wages offered by these large crews.

The big argument is whether the cost savings passed onto the people buying the homes (construction is a notoriously low margin business) benefit the economy more/less than the wage reductions for the people building them. In this part of the country, the homes were huge mansions for the 1%ers. I doubt it is a net gain for the economy, and certainly results in neighborhoods where there are not-quite developed world living conditions.

But what about produce? American born citizens are not willing to pick produce for the wages currently offered, so farmers turn to illegal immigrants. (Why pick vegetables all day when McDonalds pays more per hour?) If farmers were forced to use Americans, they would have to pay significantly more per hour in wages. This cost would be passed on to consumers. Not sure how much more tomatoes would cost in this scenario, but it would be more.

Personally, I think I'd rather have significantly higher wages for a larger portion of the population combined with marginally higher prices for a huge portion of the population, rather than the opposite, which is in effect the WalMart model.

When money gets concentrated into a smaller and smaller percentage of the population, you start to get similar effects to a Soviet style planned economy. Rich idiots who delegate management of their money to the Morgan Stanleys of the world, while the working classes can't make enough to start a savings account and maybe start a business one day.

The idea that increased labor costs would be passed onto consumers glosses over the relevant economics. In reality, the increased labor costs will result in both increased prices and decreased corporate profits, with the precise split being determined by demand elasticity.

And even to the extent that increased labor costs are passed onto consumers, we have to ask ourselves: what does the economy need? Cheaper products or better-paying jobs?

Drucker famously said that the price of something has nothing to do with it's cost. The market doesn't care how inefficient you are at picking tomatoes. The fact is, you'll be out of business because there will be other farms that can and will get cheap pickers. Also, consumers idea of a fair price of tomatoes does not factor in how much it cost to pick and ship, as is true with anything they buy.

Not sure by your comment, but you and I agree. Although you are right that I glossed over with the old "passed onto consumers" part. I majored in economics, but I forget that on HN people actually know what elasticity is, and therefore I shouldn't dumb down my comments. :)

American born citizens are not willing to pick produce for the wages currently offered, ...

Yes they are. Robotics engineers stand ready to pick every vegetable in California

Coming next: Soylent Undocumented Guest Worker.

>I'm an Australian who recently became a Canadian Permanent Resident using a "sponsorship" process [...] Make no mistake about it, bringing in foreigners lowers the quality of life for the original citizens, and only helps increase corporate profits.

Beyond the hypocritical aspects of your argument ("the ladder I used is too easy to climb, take it away now"), you're also leaving out a few minor benefits that accrue to "original" citizens in your scenario:

1. Increased profits help shareholders.

2. Profits are subject to tax, and increased tax receipts fund more public programs.

3. Lower costs are at least partially passed to customers.

So it's not as simplistic as you make it sound. Also maybe it's just me, but saying things like "those foreigners live 20 to a house" sounds rather xenophobic.

> Beyond the hypocritical aspects of your argument ("this ladder I used is too easy to climb, take it away now"),

Absolutely, no doubt. I'm very aware that's what I am saying, but yes, that is what I am saying. (hence the don't bite the hand that feeds me comment)

> 1. Increased profits help shareholders.

So the rich people get richer. Not what the world needs.

> 2. Profits are subject to tax, and increased tax receipts fund more public programs.

Not for the big companies that get around it with off-shore stuff (apple, google, walmart, etc. etc.)

> 3. Lower costs are at least partially passed to customers.

Do we need more cheap stuff (Walmart) or higher paying jobs for everyone?

> Also maybe it's just me, but saying things like "those foreigners live 20 to a house" sounds rather xenophobic.

I agree it does, but the fact is it's true. Being an immigrant here myself, I go to the weekly immigrant social night, and tons of my friends are those '20 to a house' people I speak of. The cost of living up here is so high it's impossible to live on $10/hr., which is why no Canadian will do the job and where this mess comes from. The truth hurts sometimes.

Who are you to decide what the world does and does not need?

This is a very complicated issue and it's not useful to speak in such sweeping generalizations.

> Who are you to decide what the world does and does not need?

Presumably a citizen of a democratic state, with the responsibility to oversee and manage its government, including, inter alia, deciding which ends it should serve.

I worry that our quality of living is unsustainable. Maybe 20 to a house is really the only rational way to live in the coming years. Maybe we can only sustain the life we have now, because we do so at the expense of other nations.

That said:

   2. Profits are subject to tax, and increased tax 
      receipts fund more public programs.

So are wages, and... well... everything.

   3. Lower costs are at least partially passed to 
      customers.

I really don't see that happening. Consumers don't look at a company's overall costs and conclude "your profit margin are way too high, give me a better deal."

1. Increased profits help shareholders.

There are fewer shareholders in a company than employees, and trickle-down economics is a sham.

2. Profits are subject to tax, and increased tax receipts fund more public programs.

Wages are also subject to tax, and the poor and middle-classes have fewer tax-avoidance options available.

3. Lower costs are at least partially passed to customers.

This is a giant leap of faith. How many times has McDonald's reduced the price of it's menu, despite all the advances in efficiency it develops?

McDonald's prices go up in response to increased costs for things like beef and regulatory compliance (insurance for when someone sues them for hot coffee), not to mention simple inflation. McDonald's would happily sell burgers for $1 if the economics remained the same as they were back when they did.

Exactly. They choose to increase prices rather than decrease profits even a fraction.

That's unrelated to the statement I addressed. If McDonald's could pass savings on to their customers and keep the same profit margin, thus selling more burgers, and generating a higher total profit, they would.

It's not the same system. Fast food companies are using temporary foreign workers and they wouldn't be able to transition to becoming permanent residents.

> I personally think the idea of bringing in foreign labor is a very bad thing for the sponsoring country. [...] They can't work anywhere else, and if they quit they are deported.

It sounds like a vicious cycle:

Immigration is bad -> Limit immigrants or deport them on a hair trigger -> Employers leverage/exploit the circumstances -> Bad results -> Immigration is bad.

I'm not saying immigration is bad, at all.

I'm saying that bringing in foreign labor to keep wages low and therefore manipulate the local market to increase corporate profits is bad. Very bad.

Where I live, there can be a genuine shortage of labor (i.e. there are just not enough people living up here to do all the jobs - it is -40 in the winter after all)

So in that case, it makes sense to try and recruit from within Canada, at a wage that Canadians are willing to do the job for ($14-$18/hr. right now). If you still can't get enough people at that, then go to immigration, but critically, you MUST pay them the $14-$18/hr.

The controls and rules around how much immigrants are being paid are extremely lax, and in my experience, are grossly exploited in the very vast majority of cases, because it leads to higher corporate profits, which at the end of the day is the goal of all this anyway.

Production and employment is a not a zero-sum game.

I think I've being unconsciously viewing it as such, and I think that's almost the way our culture treats it.

It's strange, the more productive we get as a society, the more unbalanced we become, as if there's less to go around. Shouldn't we reach a point where people are on average working 4 hours a day instead of 8?

> they just bring in a foreigner from a second world country

Since the end of the Cold War, the "Second World" (which was a geopolitical rather than an economic distinction) is largely meaningless (First and Third World, from the same model, have sort of migrated to mean "developed" and "less developed".)

That's to say, the second world referred to the Soviet Union and the Warsaw Pact nations. None of which really exist in that form any more. Being from Australia/Canada, the OP was still part of the First World by the old nomenclature.