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A Crisis Misunderstood: Richard D. Wolff on Immigration, Labor, and the Cost of Denial [1]
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Date: 2025-06-11
In his fourth lecture, economist Richard D. Wolff turns his attention to one of the most volatile issues in contemporary American politics: immigration. Continuing his thematic analysis of the declining American empire, Wolff argues that immigration is not the cause of crisis, but a symptom of an empire unwilling to reckon with its economic realities. Mass deportations, in his view, are not acts of strength—they are acts of desperation, pursued by elites unable to solve deeper structural problems.
Wolff’s core argument is twofold. First, that undocumented immigrants are a net economic benefit—a de facto subsidy to U.S. capitalism. And second, that the scapegoating of immigrants is part of a larger pattern of denial, wherein the real failures of American capitalism are buried beneath nationalist rhetoric and xenophobic policy. His analysis is provocative, historical, and, for the most part, compelling—though it may benefit from greater engagement with the political realities driving migration policy and border control.
I. Immigration as Economic Subsidy, Not Burden
Wolff opens with a bold premise: undocumented immigrants are not a drain on the economy—they are a gift. He makes this case by highlighting how the home countries of migrants, such as Guatemala or Honduras, bear the costs of child-rearing, healthcare, and education, only for the U.S. to receive the economic benefit when those individuals enter the labor force.
“Guatemala picked up the cost… We get them only when they’re ready to work.”
This framing flips the common narrative. Instead of viewing migrants as a “problem,” Wolff sees them as cost-free surplus labor who immediately begin generating profit for American employers—often at sub-minimum wages. Their economic output exceeds their wages, creating profit for business owners, while also enabling migrants to send billions in remittances to their home countries.
Wolff contextualizes this with sharp historical insight: American capitalism has always depended on waves of immigrant labor to fill low-wage jobs and renew the working class. Deporting these workers en masse is, to Wolff, equivalent to “throwing away a gift” in the name of political spectacle. It’s not only economically irrational—it’s self-destructive.
II. The Broken Ladder: Why the Old Immigrant Narrative No Longer Works
Historically, the American Dream offered immigrants a path of upward mobility: start in menial jobs, move to better ones, raise children who climb further. But Wolff argues that this mobility ladder is broken. The economy can no longer absorb new immigrants and allow old ones to rise. The system that once allowed for “crappy jobs → better jobs” has been replaced by stagnation, precarity, and downward pressure on wages.
As a result, immigrants are now not only blocked from rising—but are actively scapegoated for taking jobs, lowering wages, and increasing housing demand. In reality, Wolff argues, it’s the economic structure, not immigrants, that has failed. Blaming immigrants distracts from this failure, which is exactly why politicians—from Trump to Biden—perpetuate it.
III. Remittances and Blowback: The Cost of Deportation
Wolff introduces a less-discussed but vital consequence of mass deportation: the collapse of remittance-based economies in Latin America. In countries like Nicaragua, Honduras, El Salvador, and Haiti, remittances constitute up to 25% of GDP. Deporting millions of migrant workers not only removes their income streams—it also forces them back into economies now unable to support them.
This, he argues, creates a “one-two punch”:
These migrants return to jobless, underdeveloped home countries;
The economies they left collapse further without their financial support.
The result? Increased instability, gang violence, and eventually more migration pressure at the border—a cycle the U.S. itself helped engineer. Instead of stabilizing the region, these policies “blow up Central America,” worsening the very crisis they claim to fix.
IV. Privatization, Wages, and Tariffs: A Broader Pattern
Wolff then zooms out to connect immigration policy with larger efforts to discipline labor, lower wages, and privatize public goods. He cites Trump-era policies such as:
Cutting the federal contractor minimum wage from $17.75 to $13.30;
Threats to privatize Amtrak and the Postal Service;
Blanket tariffs on Mexican goods—including food, car parts, and raw materials.
These policies, Wolff argues, are part of a larger economic strategy to crush the American working class by undermining wage floors, disabling labor mobility, and flooding the public discourse with manufactured enemies—immigrants, foreigners, and “cheating” allies.
“Crush the American working class. Make the middle class a memory.”
This is not policy by economic logic, he says, but by chaotic improvisation and nationalist theater. Trump’s shifting tariffs and deportation rhetoric, while appealing to a frustrated base, create investment uncertainty and supply chain disruption that threaten to trigger deep recession.
V. Critical Reflection: What Wolff Gets Right—and What He Could Deepen
Strengths:
Wolff powerfully reframes immigrants as producers, not parasites ;
He exposes the economic illiteracy of deportation as a cost-saving tool;
He connects wage suppression and xenophobia to the broader imperial decline thesis ;
His critique of tariff chaos and investment paralysis is grounded in sound macroeconomic reasoning.
Where the Analysis Could Improve:
While economically persuasive, the lecture understates political concerns , such as border security, drug cartels, and the legal integrity of asylum processes;
It assumes rationality on all sides , but immigration is as much an emotional and cultural issue as it is economic;
Wolff might overstate the coherence of Trump’s economic plan—it may be more opportunistic than strategic.
Still, Wolff’s main thesis holds: immigration is being weaponized not because it is unsustainable, but because it offers a convenient distraction from failures that elites refuse to confront. Deportation, then, is not a solution—it is an alibi.
VI. Conclusion: Immigration as a Mirror of Empire
In this fourth lecture, Wolff completes a damning picture of an empire in decline—not only in its global ambitions, but in its internal coherence. Immigration policy becomes a litmus test for how a society manages its contradictions: whether it will build on the gifts it receives, or destroy them out of fear and political desperation.
“Deporting them means you can’t get the subsidy… It’s a sign of weakness.”
Richard D. Wolff reminds us that how we treat the immigrant is not just about them—it’s about who we are, what we value, and what kind of society we’re becoming. The question is no longer whether America will remain dominant, but whether it can remain decent—in how it treats workers, allies, and its own unraveling future.
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https://www.dailykos.com/stories/2025/6/11/2327278/-A-Crisis-Misunderstood-Richard-D-Wolff-on-Immigration-Labor-and-the-Cost-of-Denial?pm_campaign=front_page&pm_source=more_community&pm_medium=web
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