When no one is satisfied, ask who designed the machine

NPR reports that the H-2A visa program — which admits temporary agricultural laborers from abroad — is growing rapidly, and yet, as the headline puts it with admirable candor, no one is happy with it. Republicans in Congress wish to expand it; they face obstacles. That is, at present, the full extent of what the record gives us. But a political economist needs very little more to begin reasoning.

Consider what a guest-worker program of this kind actually is. It is not a free labor market. It is a managed labor market — one in which the sovereign, through statute and administrative rule, determines how many workers may enter, from where, under what conditions, and for how long. The worker is tied to a particular employer, which means the employer holds a structural advantage in any negotiation over wages and conditions. I argued in The Wealth of Nations that whenever the law tips the scales in any bargain, it is nearly always tipped against the workman. A laborer who cannot freely take his services elsewhere is not a free laborer; he is something closer to an indentured one, and the inefficiency of that arrangement falls, eventually, on everyone.

At the same time, I have no patience for the argument — which I suspect animates some of the opposition — that domestic producers of food should be shielded from the competition that a larger labor supply represents. Restrictions on trade in goods serve producer interests at the consumer's expense; restrictions on the movement of labor work precisely the same mischief. The farmer who cannot hire sufficient hands at a market wage will either pay more, produce less, or both. The cost of that scarcity travels down the chain until it reaches the family purchasing food — who is, as ever, the party least represented in the legislative chamber.

What should interest us most, as a matter of political economy, is the institutional design of the program. A visa that binds a worker to a single employer is not merely inconvenient — it is a form of monopsony, a private toll on a human being's labor. The proper corrective is portability: let the worker carry his authorization from employer to employer, as any free tradesman would carry his skill from town to town. This single reform would do more for the dignity and the wages of the agricultural laborer than any adjustment to the program's numerical ceiling.

I note, as inference rather than recollection, that programs of this kind tend to calcify — the administrative apparatus grows, the employer lobby grows with it, and the workers themselves, being temporary and foreign, have the least voice in the legislature that governs their situation. This is the classic pattern I described when writing of the masters' combinations: the interests that are concentrated and organized will always speak louder than the interests that are diffuse and silent. The consumer eats; the laborer works; neither lobbies. The solution is not to abolish the program but to build into its structure the institutional safeguards — portability, inspection, enforceable contract — that make the exchange honest. A right that exists only on paper, as another story this week observes of union transparency, is not much of a right at all. The same principle governs here.