The Ignorant Investor

I was reading Methland the other day, and in one part of the book the author describes how a local meatpacking plant in rural Iowa was taken over by one of the huge agricultural giants. The unionized workers in the plant were making about $18 per hour before the takeover. Afterward, the company broke the union and and illegal immigrants came to take jobs at the plant at vastly reduced wages.

Now, how is one supposed to view this story in light of the immigration debate? When stuff like this happens, for some people it's very good. Food is cheaper for consumers, for example. Shareholders see gains in their ag company holdings. But for the workers it means a choice between leaving their homes to find work elsewhere, or sliding from the middle class into poverty. No real simple "good" versus "evil" sides there.

The housing construction boom, rising stock prices in 401Ks, cheaper HDTVs from China- this was all supposed to be the good stuff that came from policies that made low-wage labor a net positive for society. But it was a stupid plan and it didn't work.