Wednesday, 14 May 2014

Stocks, flows and immigration

The concept of stocks and flows is one of those ideas in economics that's both completely obvious yet totally ignored when it might be useful. I'm going to quickly explain the idea, then show how the political debate on immigration is all wrong, because people are mixing up stocks and flows.

 Stocks and flows diagram

Stock: how much you have. How much water is in the bath, how much money you have, how many cows are in Britain, the number of stars in the sky, the population of France, and so on. It's a total.

Flow: the rate. How fast the water is going into the bath, how fast the water is going down the plug hole, how much money you earn, how fast a car is travelling, how many babies are born each year, how many mm the grass in your lawn grows per week. The big clue that you're looking at a flow is that it'll be measured in "[amount] per [time]". Eg: miles per hour, litres per minute, births per year, £ per hour, etc.

Net flow: flow in, minus flow out. If you turn on the tap and partially open the plug, you might have 20 gallons flowing in and 15 gallons flowing out per hour. So the net flow into the bath is 5 gallons per hour.

What's that got to do with the immigration debate?

Immigration is measured as a net flow: the number of people who arrive in the country each year, minus the number who leave. The latest UK figure seems to be 212,000 per year. The immigration debate revolves around that measure: is it too high? Should the government try to reduce it? If so, how?

Labour and Conservatives have both lost support to UKIP, mainly over worries about immigration*, and there's an assumption that talking tough on immigration might win those people back. But it won't. It can't. Those people's anger will continue just the same, because they are mainly unhappy about the stock not the flow. 

Let's imagine that somehow we decide to adopt a strict "Zero Immigration" policy. What will happen? Well, the flow would stop but all the people who are already here would still be here, not least because many of the people who are perceived as immigrants were born in the UK.

What of the people who're angry because Britain doesn't look the way it used to? The people unhappy about immigrants who've moved into their street? The people who feel their traditional culture and way of life has been lost? Well, they will still be unhappy about those things because the thing making them unhappy (the stock of "immigrants", or probably of ethnic minorities) won't have changed. I was talking to a UKIP voter last week who stood on his doorstep pointing to each neighbour's house in turn, "They're Pakis, they're Pakis, they're black, they're white but German...I'm old enough to remember when you could shoot Germans!" and on he went. He was unusually strident**, but the sentiment is depressingly familiar.

The only way to make those people happy is to start "sending them home", to turn Britain back into a country of white people with British accents. Not even UKIP suggest that, because that is the politics of the BNP. Of racial purity. Of ethnic cleansing. I don't think they see it in those terms, but if you want to reduce the stock that's the only way to go about it.

Thinking in terms of stocks and flows, it should be obvious that whatever happens to the flow of immigration, there will remain a large stock of people in Britain who are either immigrants or who are seen as such because of their racial or ethnic background.

My worry is that if you respond to people's objections to the stock with an argument about reducing the flow, you will stoke up ill feeling towards people who look different, you give cover to racism, and you undermine hopes of integrating people from different backgrounds so they feel welcome as part of Britain, yet for all that you achieve nothing because you aren't dealing with the original complaint. Many of those people cheering for UKIP will still think that you aren't listening to them because all the "immigrants" will still be here. You're talking past each other. It's a political dead end, because one group is talking about stocks, the other about flows.

Here's the thing: Britain isn't going to return to a 1950s vision of racial and cultural uniformity. Pretending that it might, if only we leave the EU or introduce a tough points-based immigration system, is a lie. Promoting that lie is an act of cowardice, pandering to prejudice and emboldening the very worst tribal instincts in human nature. 

Unless you actually do want to ethnically cleanse Britain by forcing out everyone who looks foreign, why would you give a nod and a wink to those who do?

* Despite their history as an anti-EU party, UKIP's voters mainly care about immigration, not the EU. For UKIP voters, the EU is only their 4th most important issue, after immigration, the economy and crime.

** There are no prizes for guessing that he began his little rant with the words "I'm not a racist,". No, obviously not. He just doesn't like living next door to "pakis", "blacks" and Germans. *cough*bollocks*cough*