The $100bn cost of making tourists get visas

"Tough on migration" can't help but meaning "tough on tourism".

There's a lot written about the extent to which restrictions on immigration hurt the UK economy. People settling in Britain and working is a good thing: someone else has paid for their education and upbringing, and we reap all the rewards. When we stop that happening, we hurt our economy.

On top of that, overly restrictive limitations on migration have spillover effects. The most obvious one is that caps on international student numbers – who are, bizarrely, counted as migrants in national statistics – severely limits the ability of our university sector to export its services. That sector punches well above its weight internationally; if we can't even make policy which lets it compete, what hope have our smaller industries?

But other spillover effects are less discussed. One of the possible wounds of our closed-borders policy could be on tourism. A new study, highlighted by Alex Tabarrok at Marginal Revolution, looking at the effects of visa restrictions in India, finds that particularly onerous requirements can lead to a 70 per cent reduction in inbound travel.

The authors take those findings, and apply them to the case of the US. Although they caution that "extreme counterfactuals…should always be judged cautiously", the estimates are nothing short of stunning:

What would happen if the United States opened up tourist travel to all comers without requiring visas? … We calculate a 112% increase in total inbound travel. In 2010, the U.S. recorded 59,791,000 inbound visitors who spent an estimated total of $109,975,000,000 (approximately $2000 per visitor) according to World Bank data. Increasing these figures by 112% yields an additional 67 million visitors and $123 billion in spending.

That's around one per cent of US GDP a year from tourism alone; and it still doesn't take account of the extra disincentive effect of immigration checks. British people, for instance, don't require a visa to travel to the US, but the unpleasant, borderline-abusive reputation of border guards in the country may well have a deterrent effect of its own.

Tourism restrictions have to get stronger the harsher limits on legal migration are, to prevent people entering the country through back routes, so liberalisation in both areas would have to proceed hand-in-hand. But if it did, the possible gains seem to get higher every day.

The US Embassy. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

Photo: Getty
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Ignored by the media, the Liberal Democrats are experiencing a revival

The crushed Liberals are doing particularly well in areas that voted Conservative in 2015 - and Remain in 2016. 

The Liberal Democrats had another good night last night, making big gains in by-elections. They won Adeyfield West, a seat they have never held in Dacorum, with a massive swing. They were up by close to the 20 points in the Derby seat of Allestree, beating Labour into second place. And they won a seat in the Cotswolds, which borders the vacant seat of Witney.

It’s worth noting that they also went backwards in a safe Labour ward in Blackpool and a safe Conservative seat in Northamptonshire.  But the overall pattern is clear, and it’s not merely confined to last night: the Liberal Democrats are enjoying a mini-revival, particularly in the south-east.

Of course, it doesn’t appear to be making itself felt in the Liberal Democrats’ poll share. “After Corbyn's election,” my colleague George tweeted recently, “Some predicted Lib Dems would rise like Lazarus. But poll ratings still stuck at 8 per cent.” Prior to the local elections, I was pessimistic that the so-called Liberal Democrat fightback could make itself felt at a national contest, when the party would have to fight on multiple fronts.

But the local elections – the first time since 1968 when every part of the mainland United Kingdom has had a vote on outside of a general election – proved that completely wrong. They  picked up 30 seats across England, though they had something of a nightmare in Stockport, and were reduced to just one seat in the Welsh Assembly. Their woes continued in Scotland, however, where they slipped to fifth place. They were even back to the third place had those votes been replicated on a national scale.

Polling has always been somewhat unkind to the Liberal Democrats outside of election campaigns, as the party has a low profile, particularly now it has just eight MPs. What appears to be happening at local by-elections and my expectation may be repeated at a general election is that when voters are presented with the option of a Liberal Democrat at the ballot box they find the idea surprisingly appealing.

Added to that, the Liberal Democrats’ happiest hunting grounds are clearly affluent, Conservative-leaning areas that voted for Remain in the referendum. All of which makes their hopes of a good second place in Witney – and a good night in the 2017 county councils – look rather less farfetched than you might expect. 

Stephen Bush is special correspondent at the New Statesman. He usually writes about politics.