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Episode 654: When The Boats Arrive

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Episode 654: When The Boats Arrive

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Episode 654: When The Boats Arrive

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STACEY VANEK SMITH, HOST:

Hey, it's Stacey Vanek Smith. And we at PLANET MONEY got the feeling that we are going to be hearing a lot about immigration for the next few months. So we wanted to replay an episode we did a couple of years ago that answers a fundamental question. What happens to the economy when a bunch of new immigrants come into a country at once?

(SOUNDBITE OF ARCHIVED BROADCAST)

SMITH: Fidel Castro had a problem. It was 1980, and the Cuban economy was in terrible shape. And for one of the first times in this strictly controlled country, there was open dissent. Thousands of Cubans were trying to leave the country.

JACOB GOLDSTEIN, HOST:

And until this time, Castro had basically kept people inside Cuba. But then, at this moment, overnight, he switched tactics. He went on TV, and he said, you know what? The people who want to leave Cuba are defective. They don't have revolutionary blood.

(SOUNDBITE OF ARCHIVED RECORDING)

President FIDEL CASTRO: (Speaking Spanish).

GOLDSTEIN: He said, we don't want them. We don't need them.

(SOUNDBITE OF ARCHIVED RECORDING)

CASTRO: (Speaking Spanish).

(APPLAUSE)

SMITH: Castro said, if you want to leave Cuba, then leave. Go to the Port of Mariel near Havana, and go on any boat you can find.

GOLDSTEIN: And Cubans did. They filled thousands of boats - fishing boats, sailboats, little makeshift rafts - and they floated the 124 miles to Florida.

(SOUNDBITE OF NEWS MONTAGE)

UNIDENTIFIED REPORTER #1: Tens of thousands of Cubans are fleeing the repression.

UNIDENTIFIED REPORTER #2: The U.S. Coast Guard has asked the Cuban border guard to stop overloaded boats from leaving Mariel Harbor...

UNIDENTIFIED REPORTER #3: Twenty-three boats filled with over 800 Cubans reached Key West, Fla.

SMITH: Over the course of the next few months, more than 100,000 Cubans stepped out of those boats and onto U.S. soil. They didn't have jobs. They didn't have anything with them. And the U.S. was like, now what?

GOLDSTEIN: You may see where we're going with this. A scene very much like this one is playing out right now, today, in Europe, desperate people fleeing their home countries on boats, coming to try and make a new start. And the European countries on the receiving end are asking, now what? Hello, and welcome to PLANET MONEY. I'm Jacob Goldstein.

SMITH: And I'm Stacey Vanek Smith. When tens of thousands of migrants appear in a country, there are two big economic fears. Number one, they're never going to get jobs, and they're going to cost our country a ton of money. And number two, they are going to get jobs. They're going to take my job.

GOLDSTEIN: Today on the show, we find out what happened when tens of thousands of migrants showed up in Miami in 1980 looking for work, and we try to figure out what it means for Europe today.

(SOUNDBITE OF SONG, "FEEEEL IT")

WET WINGS: (Singing) I have a feeling. Listen here. (Unintelligible). Listen to the (unintelligible) sounds. Listen to the (unintelligible) sounds.

GOLDSTEIN: Back in 1980, when Castro said, get out, Mirta Ojito was just 16 years old and living in Havana.

MIRTA OJITO: I had just sat down to have lunch. It was an egg sandwich with ketchup, which is when the police came to our house, knocked on the door, and said there was a boat waiting for you at the port. And we left everything behind exactly as it was, including my lunch on the table.

SMITH: After Castro's speech, Mirta's father had been one of the first people to get in line and tell Cuban authorities he wanted out. And Mirta was ready to go. She knew what she was going to grab - two pens, a lipstick and a handkerchief. And she headed to the Port of Mariel with her family.

GOLDSTEIN: Castro had arranged for public shaming of people like Mirta's family who were leaving. Mirta could hear hecklers chanting outside - let them go, let them go.

SMITH: Mirta's pens were confiscated by customs, and she and her family crowded onto a little tugboat called the Manana. They set sail for the U.S. Mirta remembers falling asleep outside on the deck of the boat with her mother holding her ankle.

OJITO: I woke up in the morning. The sun woke me up. And by then, we could already tell that we were near the United States because there were lots and lots of boats around. And we docked in Key West around noon.

SMITH: The boat docked, and Mirta and her family walked onto the shore. They were surrounded by thousands of other refugees. Mirta's parents had no formal education. They didn't speak any English.

OJITO: We arrived with absolutely nothing and no way to prove who we were.

SMITH: And like tens of thousands of other refugees coming from Cuba at the time, Mirta's parents headed for Miami and started to look for work.

GOLDSTEIN: A few years after all this happened, an economist named David Card looked at this moment. And because he's an economist, he thought - this is this kind of beautiful, unintentional experiment that could help answer a really big question. What does a massive sudden wave of immigration do to an economy? So he crunched the numbers. He compared what happened in Miami's economy before and after the Mariel boatlift with what happened in other U.S. cities at the same time. Did unemployment go way up? Did all the new people competing for jobs drive wages down?

DAVID CARD: The prevailing view was that we would expect at least a short-run effect.

SMITH: So what did you find?

CARD: Well, I didn't find any evidence of that.

SMITH: So 80,000 refugees came to Miami, and there was no effect on the economy?

CARD: (Laughter) Well, you couldn't detect any strong evidence of an effect one way or the other.

GOLDSTEIN: Now, there is some debate about this. Some economists argue that in the short run, wages for low-skilled workers can fall when lots of low-skilled immigrants arrive. But on the bigger questions about immigration in the economy, economists pretty much agree. For most workers, immigration is not a problem. For most workers, immigrants do not drive down wages. They don't steal our jobs.

SMITH: And the reason for this is that there is not a fixed number of jobs in an economy. When a bunch of new people show up in a country, yes, they get jobs, but they also start buying stuff right away. They start getting haircuts and going to the grocery store. And that means there need to be more barbers and more grocers. That creates more jobs.

GOLDSTEIN: Mirta Ojito says, yeah, pretty much the second her family arrived in the U.S., they had to start buying stuff.

OJITO: From the get-go, you become a consumer. You need beds. You need mattresses. You need sheets. You need everything to set up a life. I mean, the less you bring, the more you consume.

GOLDSTEIN: Now, to be clear, this does not mean we can just look at what happened in Miami in 1980 and say, OK, great, we can just let in some unlimited number of people, and no matter what, the economy's going to be fine.

SMITH: David Card, the economist, says there are very particular circumstances that allow a country to take in a large number of people at once. The first thing is that the country needs to have a pretty strong economy because in the short term, there is a cost to accepting immigrants - health care, shelter, social services. And that burden can be pretty big. Germany did this calculation, and it found that one refugee costs about $14,000 per year. A fragile economy could get crushed by this.

GOLDSTEIN: And David Card's second rule, the second circumstance that needs to be true, is people who come to a new country have to be able to get jobs pretty quickly because, of course, that's when they start contributing to the economy. That's when they start creating new jobs. And in the case of what happened in Miami back in 1980, there was a huge Cuban community already in place, and it was the Cuban community that really helped out Mirta's mom and dad.

OJITO: A friend of a friend, somebody who knew him from Cuba, found him a job driving a truck of bananas, a company called YES Bananas. And my mother found work, through my aunt, in a factory. And the incredible thing to me about this story and about the United States is that we arrived Monday. By Thursday, my parents were working. And the following Monday, I started summer school.

SMITH: Mirta's parents didn't speak any English. But with the huge Cuban community, they didn't need to.

OJITO: My father figured out that he only needed to learn a few words to understand what was going on with the truck. And I wrote them out for him once I knew them myself. He put them in the pocket of his shirt. And there he went.

SMITH: For all of the fear that there was on both sides, the Cuban refugees did just fine in Miami. And Miami did just fine with the Cuban refugees.

GOLDSTEIN: So OK, what does this tell us about what's happening today in Europe? Because clearly all those things Mirta lived through are happening right now, 35 years later.

OMRAN QASSAR: I'm Omran Qassar. I'm 23. And I'm from Damascus, Syria.

SMITH: Omran Qassar left Syria with his brother about a month ago. They went to Turkey, and they hired a smuggler. They paid him $1,200 each. And with about 40 other people, they crowded onto this little inflatable raft. And they set sail for Greece. About an hour into their four-hour journey, the boat began to deflate. Water started flooding in. It was pitch black outside. No one could see. Omran's brother got so scared, he fainted.

QASSAR: They were screaming. They were even fighting. Some people were fighting. It was crazy. I had nothing to do but praying, and I just hoped that we could survive.

GOLDSTEIN: Omran held on to his brother with one arm. And with the other, he grabbed a plastic bottle and started bailing water out of the boat. Eventually, they made it to this tiny Greek island called Nera. As soon as Omran caught his breath, he texted his mom.

QASSAR: Told her that we're OK and I'll call you once I get the chance.

SMITH: Omran and his brother, like a lot of migrants, began to make their way to the wealthier part of Europe, to Western Europe.

GOLDSTEIN: And David Card, the economist, he says Western Europe meets his first criterion for being able to absorb migrants successfully. Despite the, you know, economic troubles in Europe we've heard a lot about, Western Europe is still rich enough, still has a big enough, robust enough economy to absorb the migrants that are coming in.

SMITH: And remember David Card's rule number two, getting jobs quickly? This is a little different for the Syrians. There is not a huge established Syrian community in Western Europe the way there was a huge established Cuban community in Florida. But the Syrians have something else going for them. And it's people like this.

RAINER HUNDSDORFER: My name is this Rainer Hundsdorfer. And I am the CEO of EBM-Papst.

GOLDSTEIN: Not Pabst the beer, Papst the multibillion-dollar German company that makes industrial fans. They make tiny little fans that go inside electronics. They make huge, six-foot-tall fans that cool server farms.

HUNDSDORFER: Facebook and Google wouldn't work without us. Banks wouldn't work without us. So you can't escape us at all. If we wouldn't be there, the world would stop because the world would overheat.

SMITH: Rainer has started a program to recruit and train Syrians. He says he is desperate for workers - engineers, managers, people working the assembly line. And he is hoping that all of the Syrians coming into Germany right now will mean that he can fill all of his open jobs.

HUNDSDORFER: We intend, of course, as much as we can, to help those people but also help us by, you know, finding good, qualified people amongst those refugees.

SMITH: Do you have a hard time finding workers to fill your jobs?

HUNDSDORFER: Yes.

SMITH: There are a lot of companies like EBM-Papst. Populations in Western Europe are aging. Workers are retiring. And unless people can come in to fill those jobs, companies can't grow. The economy can't grow. People like Rainer, companies like Papst, they need people like Omran Qassar.

GOLDSTEIN: And Omran and some of the other Syrian refugees have an advantage that Mirta's family did not. Omran has a college degree, a degree in economics. He actually left Syria the day after he passed his last final. And a lot of his classmates left with him. If they'd stayed, he says, they would have been drafted to fight in Syria's civil war.

QASSAR: It was obvious. It was obvious. Everybody who passed his last exam, the next day, the next week, you'll find him out of Syria.

SMITH: Omran and his brother made it to France. That's where they are now. And they arrived at the exact moment when France was trying to sort of show the world that they were welcoming Syrians.

QASSAR: There were some media, and even president of France came.

SMITH: You met the president of France?

QASSAR: I met him, and I appeared with him on TV. It was amazing. Francois Hollande.

SMITH: Yeah.

QASSAR: He said, bienvenue, bienvenue.

SMITH: Bienvenue, welcome.

QASSAR: Bienvenue en France.

SMITH: Omran expects to get his working papers this week. And eventually, he wants to get his masters in economics at the Sorbonne.

(SOUNDBITE OF SONG, "FEEEEL IT")

WET WINGS: (Singing, unintelligible).

GOLDSTEIN: Mirta Ojito grew up and became a journalist. Eventually, she went to work for The New York Times. She covered immigration. Her parents stayed in Miami.

SMITH: Did you ever send them your articles?

OJITO: You know, when my father died, my mother gave me a box, a box with the articles he had saved.

SMITH: Did you know he'd been saving them?

OJITO: No. He had never learned English. He saved all of those articles even though he couldn't read them.

(SOUNDBITE OF WET WINGS SONG, "FEEEEL IT")

SMITH: Mirta wrote a book about her journey from Cuba to the U.S. It's called "Finding Manana." There are a few people that we would like to thank. The first is Eleanor Beardsley, NPR's Paris correspondent. She put us in touch with Omran Qassar. Also reporter Alexandra Starr.

GOLDSTEIN: Our show today was produced by Jess Jiang. You can find us on Twitter, @planetmoney or @jacobgoldstein or @svaneksmith.

SMITH: @svaneksmith.

GOLDSTEIN: If you're looking for more to listen to, try Hidden Brain. You can find Hidden Brain on the NPR One App, on iTunes or wherever you get your podcasts. I'm Jacob Goldstein.

SMITH: And I'm Stacey Vanek Smith. Thanks for listening.

(SOUNDBITE OF SONG, "FEEEEL IT")

WET WINGS: (Singing, unintelligible).

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