Capping benefits for migrants could serve to drive down wages for all

Forcing migrants into whatever work's going will render exploitation a breeze.

From an economic point of view, it's difficult to assess David Cameron's proposal to limit the amount of social support migrants from the EU can receive. Migration is a nearly unqualified positive to a nation's economy, but those positives generally rely on the point that migrants are likely to be in work and a net contributor to the public purse – more likely, in fact, than native Britons. But the premise of the new policy is that it doesn't affect those "good" migrants. So what to think of it?

Firstly, the background. Immigration is a boon to society, and immigration from the EU is no different. A study by UCL's Centre for Research and Analysis of Migration finds that in 2008/9, workers from Eastern Europe contributed £1.37 in taxes for every £1 of services they used, while native Britons contributed 80p to the pound. Migrants represent about 13 per cent of all workers but only 7 per cent of all benefit claimants. Liberalising immigration worldwide could result in a 116 per cent increase in wages overnight.

But arguments in favour of Britain alone opening its borders tend to focus on one very specific benefit of migration. Almost by definition, the foreigners who arrive on our shores seeking work are among the most motivated, richest, and capable members of their nations; as a result, they tend to be a net bonus to the British economy. (Even if you control for characteristics like age, education, children and disability, the UCL study still found that Eastern European migrants were less likely to claim benefits).

But David Cameron's plan is to ban EU nationals "from claiming most benefits after six months in the UK unless they can prove they have been continuously looking for work over that period", according to the Guardian's Patrick Wintour. Since the vast majority of migrants don't claim benefits, and the advantage of migration is frequently attributed to the fact that migrants are more frequently in work, how could this backfire?

On the face of it, it couldn't, because it's largely an empty policy. Cracking down on issues which have a disproportionate public profile is the bread-and-butter of immigration politics. In this way, Cameron's idea follows in the tradition of Ed Miliband's requirement that public sector workers speak English (they overwhelmingly do, as do 99.73 per cent of people living in England and Wales) and Gordon Brown's decision to "suspend" low skilled migration in 2008 despite the fact that it had been practically suspended since 2004. A lot of fuss over something which "fixes" problems which people think they have about immigration.

But there will be effects nonetheless. Because while few migrants claim state aid, the social safety net has an effect on people in work as well. The harsher life is for an unemployed person, the more power employers have over employees. A crucial part of economic life is the ability to tell your employer to go shove it if they treat you badly, and go and find a better job. That keeps the employer/employee relationship more equitable than it might otherwise be, and ensures better treatment for all – even those who would never have the courage to walk out themselves.

There is some evidence that, at the lower levels of pay, migration does drive wages down. The best response to that is through redistribution, rather than a cap; if migration grows the economy by more than it drives wages down, then a redistributionist state can make everyone better off. But Cameron's cap will serve, at the margin, to drive wages for migrants lower still, by forcing them to take jobs at conditions that native workers, without the pressure of starvation after six months, might not do. And since everyone is competing for the same jobs, that will push wages for native workers lower too.

The macroeconomy of that policy might still end up being a positive, because exploitation of labourers is good for the bottom line. But it doesn't seem like the sort of economy which Cameron wants to run.

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 Images
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I'm far from convinced by Cameron's plans for Syria

The Prime Minister has a plan for when the bombs drop. But what about after?

In the House of Commons today, the Prime Minister set out a powerful case for Britain to join air strikes against Isil in Syria.  Isil, he argued, poses a direct threat to Britain and its people, and Britain should not be in the business of “outsourcing our security to our allies”. And while he conceded that further airstrikes alone would not be sufficient to beat Isil, he made the case for an “Isil first” strategy – attacking Isil now, while continuing to do what we can diplomatically to help secure a lasting settlement for Syria in which Assad (eventually) plays no part.

I agreed with much of David Cameron’s analysis. And no-one should doubt either the murderous barbarism of Isil in the region, or the barbarism they foment and inspire in others across the world.  But at the end of his lengthy Q&A session with MPs, I remained unconvinced that UK involvement in airstrikes in Syria was the right option. Because the case for action has to be a case for action that has a chance of succeeding.  And David Cameron’s case contained neither a plan for winning the war, nor a plan for winning the peace.

The Prime Minister, along with military experts and analysts across the world, concedes that air strikes alone will not defeat Isil, and that (as in Iraq) ground forces are essential if we want to rid Syria of Isil. But what is the plan to assemble these ground forces so necessary for a successful mission?  David Cameron’s answer today was more a hope than a plan. He referred to “70,000 Syrian opposition fighters - principally the Free Syrian Army (FSA) – with whom we can co-ordinate attacks on Isil”.

But it is an illusion to think that these fighters can provide the ground forces needed to complement aerial bombardment of Isil.  Many commentators have begun to doubt whether the FSA continues to exist as a coherent operational entity over the past few months. Coralling the myriad rebel groups into a disciplined force capable of fighting and occupying Isil territory is a heroic ambition, not a plan. And previous efforts to mobilize the rebels against Isil have been utter failures. Last month the Americans abandoned a $500m programme to train and turn 5,400 rebel fighters into a disciplined force to fight Isil. They succeeded in training just 60 fighters. And there have been incidents of American-trained fighters giving some of their US-provided equipment to the Nusra Front, an affiliate of Al Qaeda.

Why has it proven so hard to co-opt rebel forces in the fight against Isil? Because most of the various rebel groups are fighting a war against Assad, not against Isil.  Syria’s civil war is gruesome and complex, but it is fundamentally a Civil War between Assad’s forces and a variety of opponents of Assad’s regime. It would be a mistake for Britain to base a case for military action against Isil on the hope that thousands of disparate rebel forces can be persuaded to change their enemy – especially when the evidence so far is that they won’t.

This is a plan for military action that, at present, looks highly unlikely to succeed.  But what of the plan for peace? David Cameron today argued for the separation of the immediate task at hand - to strike against Isil in Syria – from the longer-term ambition of achieving a settlement in Syria and removing Assad.  But for Isil to be beaten, the two cannot be separated. Because it is only by making progress in developing a credible and internationally-backed plan for a post-Assad Syria that we will persuade Syrian Sunnis that fighting Isil will not end up helping Assad win the Civil War.  If we want not only to rely on rebel Sunnis to provide ground troops against Isil, but also provide stable governance in Isil-occupied areas when the bombing stops, progress on a settlement to Syria’s Civil War is more not less urgent.  Without it, the reluctance of Syrian Sunnis to think that our fight is their fight will undermine the chances of military efforts to beat Isil and bring basic order to the regions they control. 

This points us towards doubling down on the progress that has already been made in Vienna: working with the USA, France, Syria’s neighbours and the Gulf states, as well as Russia and Iran. We need not just a combined approach to ending the conflict, but the prospect of a post-war Syria that offers a place for those whose cooperation we seek to defeat Isil. No doubt this will strike some as insufficient in the face of the horrors perpetrated by Isil. But I fear that if we want not just to take action against Isil but to defeat them and prevent their return, it offers a better chance of succeeding than David Cameron’s proposal today. 

Stewart Wood is a former Shadow Cabinet minister and adviser to Ed Miliband. He tweets as @StewartWood.