Elon Musk. (Brendan Smialowski/GDA Photo Services/Newsco)
According to a recent Washington Post article, Elon Musk was at one point working illegally in the United States and was subject to deportation. He was able to remain in the United States and eventually legalize his status because law enforcement was either unaware of his status or turned a blind eye. Much of the commentary on this issue focuses on Musk’s hypocrisy. Since then, Musk has become an advocate of tough policies against illegal immigration, under which people like himself would be deported.
But Musk’s story also highlights the harm caused by immigration restrictions. Alex Nowrasteh, an immigration policy expert at the Cato Institute, explains:
What bothers me about the WaPo article is how destructive the US immigration system is. It was almost impossible for Elon Musk to settle here, found several innovative companies, drive technological progress, and build enormous consumer surplus and shareholder value. Mr. Musk is a one-in-a-billion innovator and businessman. If America’s immigration system had prevented at least one Musk-type entrepreneur from coming here in the last century, intelligent nativists should reconsider their position. Few people would want to get rid of Mr. Musk right now, but they support rules and enforcement that could prevent the next Mr. Musk from coming here or staying here. Musk was bright before he got his work visa, but there were few signs he would become the world’s richest man. The conceit of the immigration central planners almost destroyed Mr. Musk’s talent. Don’t make the mistake of ignoring the right end of the distribution or accepting more people. One of them could take us to Neptune. I hope those who read this story can take away the same lesson instead of focusing on the hypocrisy.
If Musk had been forced to return to South Africa, he likely would not have had the opportunity to innovate significantly or found Tesla or SpaceX.
Immigrants contribute disproportionately to a variety of entrepreneurship and scientific innovations. As I discuss in detail in my article “Economic Freedom for Immigrants and Native Americans,” it is possible that large-scale immigration restrictions will inevitably lead to major innovators and important scientific advances. That means locking out a significant number of people. The immigrants we lock out today may have made scientific discoveries that could save your life or the life of your loved one.
Clearly, a small proportion of would-be immigrants will become major innovators. But that small part is very important. And the cumulative effect of excluding large numbers of general immigrants is that we also lose the significant economic and scientific contributions of major innovators.
I’m not as bullish as Alex Nowras on the impact of Mr. Musk in particular. The benefits of his great innovations are partially offset by his pernicious influence on political discourse, including his promotion of false conspiracy theories about immigration (the “Great Alternative Theory”) and voter fraud. But overall, the benefits of Mr. Musk’s presence in the United States almost certainly outweigh the costs. The real problem with political misinformation is one of demand rather than supply. As long as there is a great demand for conspiracy theory-fueling clapbacks, political entrepreneurs are likely to supply it. The particular claptrap that Musk promotes was not invented by him, and was widely popular (including by Donald Trump) before Musk became involved. By contrast, Musk’s entrepreneurial innovations are far less likely to have been quickly achieved by others without him. And long before Musk bought it, Twitter was a cesspool of terrible political debate. At best, it only made the situation slightly worse.
Mr. Musk could end up having a very damaging political impact. But perhaps he just somewhat amplified a terrible idea that was already widespread. Furthermore, we are wary of giving powers to governments that exclude immigrants on the theory that they can spread harmful political ideas. If we do not trust the government to censor potentially harmful ideas propagated by natives, the same argument undermines the basis for ideological screening of immigrants. Elsewhere I have addressed in more detail the problems posed by the potential for immigrants of extraordinary individuals to cause great harm, either as political leaders or as producers of harmful technological innovations.
In summary, the real lesson from Musk’s story as an undocumented immigrant worker is that immigration restrictions often stifle very valuable innovation. Musk was lucky to be able to avoid the system. Many other people who are potentially great innovators are not so lucky.