De Dion Quadricycle, 1898 — same price as the 1914 Model T!

Recent U.S. employment figures have seen a rise in the native-born workforce, a decline in the immigrant workforce and a rise in real wages. Some companies seem to have noticed – Home Depot’s $5.5 billion acquisition of the building supply contractor GMS indicates a move towards the contractor market, whose distribution pattern is less labor-intensive than the retail home improvement market. Electorates all over Europe are coming to notice that “globalized” economic policies have reduced their job opportunities and reversed their wage gains of previous decades, while well-connected corporations seek ever more immigration to lower labor costs still further, dumping the resulting social costs and maladies on taxpayers. Ditching the cheap labor impulse is a revolution that bodes well for the world, rich and poor.

I wrote in detail last September of the malign history of the cheap labor lobby, which saw its genesis in the Industrial Revolution and the replacement of the admirable Lord Liverpool’s high-wage policies with the sweatshop principles of Sir Robert Peel.

Globalization and cheap travel have provided excuses for the cheap labor principle to become entirely dominant (though to be fair in the Obama and Biden administrations, the more important principle involved was that of infinite legal or illegal controllable votes for the Democrat party and their destructive policies). The same has been true in Europe, with the political incentives for the left to push immigration being the same and the right being either too feeble to oppose it, or too captured by “woke” ideology, or stymied by illegitimate legal interference such as by the UK Supreme Court and the European Court of Human Rights. In Britain and much of Europe, it is now illegal to oppose excessive immigration, and can result in a prison sentence, as the natural instinct of the Left to lock up its opponents has been given full rein.

Now the blessed arrival of President Trump has changed matters, at least in the U.S. The Bureau of Labor Statistics’ monthly unemployment figures illustrate this well. In June 2025 alone, 830,000 U.S.-born workers gained employment, while employment among foreign-born workers declined by 348,000. In the first half of 2025 over 2 million U.S.-born workers gained jobs, while half a million foreign-born workers lost them. That is in contrast to 2024, in which over 1 million foreign-born workers gained jobs while employment of U.S.-born workers declined. With the modest caveat that of course, many foreign-born workers are legally resident or even, like myself, U.S. citizens, those raw numbers show that Trump’s arrival has represented a massive triumph for the American people over the cheap labor lobby.

There have only been about 100,000 physical deportations since Trump came to office, but (inevitably imprecise) estimates suggest that an additional 1 million illegal immigrants have self-deported. That is still only a modest percentage of the estimated 20 million illegal immigrants that have entered the United States since control over the border was lost under the hapless George W. Bush, but it is a start.

The 10 to 1 ratio of voluntary departures to enforced removals is especially encouraging; it suggests that a concerted program that removed only 2 million people forcibly during Trump’s term in office would produce the voluntary departure of essentially all the remaining illegal immigrants. That would not completely return the United States to a society managed by and for its citizens, as would be desirable, because there would remain the legal residents who had not yet achieved citizenship and the deeply regrettable and illegitimate helots produced by George H.W. Bush’s H1B and H2B visa schemes.

The great Enoch Powell correctly told us in 1968 that the only solution to the social and economic problems of excessive immigration was “send them home.” However, we can now see that it is only necessary to deport around 10% of illegal immigrants and the rest will return home of their own accord. To ensure that this is achieved, the removal program must continue to be operated with due rigor and with no loopholes, as the wholly admirable Deputy Chief of Staff Stephen Miller is currently doing. Marketing gimmicks such as the “Alligator Alcatraz” are also helpful, as is proper enforcement of legal prohibitions against hiring illegals.

Trump must not allow himself to be “nobbled” by the loathsome cheap labor lobbyists in agriculture, hospitality or construction, who parade an endless variety of sob stories and rationales why they should be exempt from the new immigration rigor. If there are loopholes, the efficacy of the program will be lost and the American people betrayed; hence there must be no loopholes.

Trump must also be persuaded that high immigration, even legal, is an unacceptable drag on domestic living standards and that the H1B and H2B programs, in particular have no purpose other than to immiserate domestic workers in the sectors concerned and discourage young Americans from taking qualifications in STEM subjects. In all STEM-based careers, illicit and excessive wage competition through the blizzard of H1B visas is encouraged by a deeply corrupt political system; the wise youth will thus decide to become a well-remunerated lawyer, subject to no such wage erosion.

It is devoutly to be wished that Trump’s removal program will be wholly or mostly effective and that its success will be noticed by European electorates, who will cease tolerating the lies and evasions of their political and legal masters. Combined with the deglobalization that is already taking effect through tariffs, and ideally with a sharp diminution in legal immigration to rich countries, this will have highly favorable economic effects:

• It will raise wage rates for domestic workers in rich countries, both skilled workers in sectors such as software that have been attacked by the cheap-labor lobby and unskilled workers in all sectors;
• It will increase innovation and automation, especially through AI applications, in areas where labor has now become more expensive. This was the chief driver of the Industrial Revolution; it is not a coincidence that it happened first in Britain, where wages were highest;
• It will provide new employment even in the Third World, as businesses that require cheap labor will set up operations in countries that have abundant cheap labor (and responsible, non-Marxist governments) rather than attempting to import helots into the West
• It will force governments to reduce regulations and avoid burdening their economies with abominably inefficient and expensive “climate change” fripperies, since it will no longer be possible to pay for those fripperies by forcing down real wages;
• It will produce abundant synergistic benefits in the form of new industries, possible only because the domestic population has good purchasing power.

The classic example of a new industry generated by well-paid workers protected by a high tariff barrier is the Ford Model T. Mass production of automobiles was possible everywhere, but it needed a mass domestic market to be viable, because it required a high volume of sales. With high U.S. tariff barriers, immigration beginning to be restricted and high farm prices, the U.S. in 1910-15 had a domestic population of skilled and unskilled workers, urban and rural, with the highest wage rates in world history to that date. Hence, there was a mass market for Model Ts.

The great French automobile producer, Count Jules-Albert de Dion’s De Dion Bouton, was making speedy and reliable motorized tricycles in 1898 at Model T’s 1914 prices, after mass production had kicked in, of around $400 per vehicle. However, France’s ordinary laborers were still much too poor in 1898 or indeed 1914 to afford $400 a vehicle. Ford’s Highland Park plant, with its $5-day ($1,300 per annum) wages, far higher than in Europe, had shopfloor workers driving to work in 1914-15; in British and French factories most of the shopfloor workers were still walking or cycling to work in the 1950s.

The advent of AI both increases the dangers of sloppy immigration policy and increases the benefits of a tight one. With AI, innumerable routine jobs will disappear, but the disappearing jobs will primarily be those for arts graduates at the bottom end of the scale. Plumbers will still be needed, because AI is well short of the complex observations and interactions needed to repair an unfamiliar plumbing system, let alone deal with the customer whose toilet is blocked. If immigration is restricted and wage rates correspondingly high, there will also be a corresponding demand for products and services that have been enabled by AI, the production of which will not move immediately to China because of sturdy tariffs. The rise in wage levels through AI will thus be self-reinforcing, as wage rises were in the blissful period from 1945 to 1973.

For poorer countries, the repatriated ex-immigrants will provide skills and knowhow that will enable their home countries to develop more quickly. They may also provide their home countries’ political systems with an influx of capitalism that will produce economic improvement. Socialists in poor countries can no longer credibly proclaim that their nostrums will produce Nirvana. The example of Argentina, already far along the road to redeeming eighty years of statism through Javier Milei’s sound, courageous and rigorously free-market economic policies, should convince them that better outcomes are possible.

The ‘globalization’ of the 1990s, based on the “Washington Consensus” and rapid population increase did not achieve Third World sustained growth, because its Consensus was largely social democrat and, as we now know, was pushed by USAID and international agency bureaucrats for whom socialism was a noble ideal and corruption in its service was acceptable. With Milei-like policies and restraint of excessive fertility, the entire Third World can become rich, even if USAID has been abolished, the UN and other agencies defunded and much of the Western world is blocked to their exports through tariffs. Emerging Markets have human resources as good as we do, they would no longer be losing their best and brightest to the West, so they should be able over a generation to become as rich as the West, largely through developing their domestic economies and markets.

Only the first signs are yet visible of a reversal of excessive immigration, but the Bureau of Labor Statistics’ Employment figures show the benefits such a reversal can bring. Signs of a reversal of free-immigration policies should be nurtured and effective anti-immigration policies should be copied worldwide. With this change, the immiseration and decline of the West can be reversed.

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(The Bear’s Lair is a weekly column that is intended to appear each Monday, an appropriately gloomy day of the week. Its rationale is that the proportion of “sell” recommendations put out by Wall Street houses remains far below that of “buy” recommendations. Accordingly, investors have an excess of positive information and very little negative information. The column thus takes the ursine view of life and the market, in the hope that it may be usefully different from what investors see elsewhere.)