STATIC STATE AND THE TECHNOLOGY OF ECONOMIC REFORM 35
The law passed by Congress soon after the war restricting immi-
gration is wholly responsible for the present labor shortage. If this
law had never gone on the statute books, if our portals had remained
as free to immgration since the war as they were before the war and
as they have been throughout our history, our inflated wage scale
would have been well liquidated before now.
This furnishes an excellent example of the efficacy of the
method of controlling price by playing with an economic
equilibrium. It would take Mr. Munsey’s class a long time and
much hard fighting to beat down wages by the direct method.
By simply removing the restriction upon immigration, the thing
would, after that was accomplished, work automatically. Immi-
grants from all the low wage countries of Europe, Asia, Africa,
and the Islands of the sea would swarm here seeking jobs. They
would force wages down without further effort on the part of
employers. If wages can be forced down by this simple device,
they can also, if other factors remain the same, be maintained at
the present level, or forced even higher, by further restriction,
that is, by putting the American Continent, as well as Europe, on:
the quota basis.
Again, if it is found that one factor in the equilibrium of the
demand for and supply of labor is a low standard of living on the
part of native laborers, that is, if it is found that they have such
a low standard of living that they will multiply and keep the
labor market well supplied on a low wage, then it will begin to
appear that if the standard of living can be raised so that they
will not multiply and offer themselves at such low wages, a new
and higher equilibrium wage will establish itself automatically.
That is to say, where laborers have a very high standard of
living, one generation after another, it will take a very high wage
to induce as many laborers to offer themselves for hire as
employers are willing to hire.
If no one would marry and undertake the support of a family
until he could have a savings deposit, a life insurance policy, a
home, or an automobile, it is obvious that no children would be
legitimately born except in homes where these things could be
afforded. That would, in a generation or two, eliminate low wages
and poverty.
If, however, the attempt is made in the opposite direction, and
wages are merely advanced artificially without first raising the
standard of living, such a rise may, with the exceptions noted in