Daniel Di Martino on Life in Venezuela and Immigration

socialism inflation immigration hyperinflation

When you realize the only way to succeed in your home country is to leave it, what happens next? The founder of the Dissident Project recounts his growing up in Chavez's Venezuela any why he is such a passionate advocate for freedom today.
Daniel Di Martino is a PhD candidate in Economics at Columbia University and a graduate fellow at the Manhattan Institute—where he focuses on high-skill immigration policy. He also founded the Dissident Project to teach high school students about the evils of socialist regimes.

Today we talk about his life in Venezuela and the economic realities he faced growing up, particularly inflation and shortages. He explains how poor institutions, even democratically elected ones, can turn a trusting and prosperous society into a mistrusting and thieving one. (Watch out ladies, they’ll even steal the hair from your head). We talk about the incentives involved in immigration policy and the immigration situation in places like New York City and Miami today.

Want to explore more?

Read the transcript.

Juliette Sellgren 
Science is the great antidote to the poison of enthusiasm and superstition. Hi, I'm Juliette Sre and this is my podcast, the Great Antidote- named for Adam Smith, brought to you by Liberty Fund. To learn more, visit www Adam Smith works.org.

Welcome back. When you meet someone who really knows what they're talking about, not only because they're well read and they know the facts and the stats and they really conceptually understand it, but they've also kind of lived through the thing and they're really good at communicating that. That's Daniel DiMartino, who I'm excited to invite onto the podcast today on May 9th, 2024. He's a PhD candidate in economics at Columbia University, and he's a graduate fellow at the Manhattan Institute where he focuses on high skill immigration policy. He also founded the Dissident Project, which teaches high school students about the evils of socialist regimes. That's what we're going to be talking about today. So welcome to the podcast.

Daniel DiMartino 
Thank you for having me, Juliette.

Juliette Sellgren 
So the first question might be a little silly because we're basically in the same age cohort, but what is the most important thing that people my age or my generation, our generation, should know that we don't?

Daniel DiMartino 
Okay. Well, I'm 25. I'm 25. I'm not sure. I think you're a little younger, but yes, we're not too far apart. What's the most important thing you ask career wise, personal wise? 

Juliette Sellgren 
However you want to interpret it.

Daniel DiMartino (1.42)
I think honesty is extremely important, and I think being true to yourself, to your values, and having the right values, right? I'm a Catholic. I think that God has a purpose for each of us on earth and trying to follow that purpose. And so I think that that's the most important thing for young people, for all people, for everyone. But it's especially true for young people as we try to find out what is that purpose for the rest of our lives.

Juliette Sellgren (2.15)
Yeah, it is kind of deceptive though, because I don't know, I'm wondering if you kind of run into this. I always feel like I think I know myself, and so then I'm like, well, obviously I know the entire path that is to follow, but that's not necessarily true. Knowing yourself now doesn't mean that you can predict the future, which seems obvious, but I keep running into this where I'm like, I feel like I should know what the future holds. And the thing that comes along with honesty is kind of trust. If I know myself, I should trust myself in the environment I put myself in, but I keep forgetting this in some way or another. And I'm wondering if you feel this, I see people, me doing this.

Daniel DiMartino (3.00)
Well, I'm not sure what knowing yourself means. What I mean with what I said is knowing your purpose, you need to have a purpose, not to predict the future, but simply to know what you're going to do, what you're going to act. The only thing you can control is what you do, not what others do. So that's what I meant with trying to find the purpose that God has given you. And this is actually a very economic concept in a way, because when we talk about the concept of comparative advantage, it means that even if somebody is better than you at everything, you still have a comparative advantage over them based on your relative capacities. And in a way, your comparative advantage may be your natural God-given purpose. For some people that is math, for some people, that is construction, for some people that is, I dunno, the tourism industry, whatever. So everybody has a purpose, something they can do, something they can excel at. For me, the moment that really defined trying to find what I needed to do was living in Venezuela, which is one of the things you wanted to talk about today. And that made me ask myself many questions over how do I live Venezuela? What is going to happen in Venezuela? I can't predict the future. I can only control what I do. And so I decided I am going to save myself.

Juliette Sellgren (4.32)
And we're going to get into that because I'm so curious, and I think it's a moving story, but I agree. I guess what I'm thinking about is I think I see my comparative advantage, but then I end up being wrong. And I don't know if it's me willing it to be a certain way. I just realized that sure, I like a certain type of math, but that doesn't mean I'm good at math writ large and that is what I should be doing. That sort of thing. And I guess even then you continually learn more. And I guess that's the whole process is as you kind of narrow down what the purpose is, you get better at actually pursuing that. So let's get into it. When I first met you, it was at this cocktail hour sort of thing for Young Voices, and you spoke briefly about what drew you to speak for and work towards freedom professionally. And I was captivated when you were speaking, and you referred to this a little bit, but can you tell us about your journey growing up in Venezuela and how you ended up here doing all the things that you do?

Daniel DiMartino (5.44)
Yeah, so I was born in 1999 in January, at least one month before Hugo Chavez took power in Venezuela. He's the man who democratically elected, destroyed our country by implementing real what he called 21st century socialism. That was the name of his ideology. And he took people's businesses, he put price controls on almost every service and good that was sold in the country. He controlled our access to foreign currency. Obviously, he turned a state that used to be democratic into an authoritarian one because that's how you remain in power after your policies destroy the economy and make you unpopular. You can't remain democratically. Socialism can start democratically as Venezuela, but it never ends. Democratically though democracy is not the important part. The important part is the socialism part, because that's what destroyed our economy. And so I grew up in a country that was very different from the country my parents grew up in.

My parents went to college despite their parents being immigrants, not even borrow of them. By 2016, we were making $100 a month. That's what hyperinflation diminished purchasing power to that amount. And of course, that's not an amount that you can live off of. We had to start consuming our savings. And that's when I decided, look, the best hope I can have in Venezuela if I stay after graduating high school is to feed myself. That's the best hope I have. And indeed, that's what a lot of people came to the same conclusion as I did. And today, Venezuela is the largest refugee crisis in the world. There are over 8 million of us who have left the country out of 30 million, so nearly a third of the population and everything was destroyed. Right now, Venezuela is a country that is 80% smaller economically. People have the same level of income as the 19th century.

There are very common rolling blackouts, no water in many places. It's very dangerous country with a lot of crime. That's another aspect of what the regime did to us. And so I [took] English classes and I decided that the best path for me was to study economics. I can tell you a little bit about why I decided to study economics, but I really lived in a real time economic experiment. And so that's part of what motivated me. And I got a full ride to start in Indiana. So I moved to Indiana in 2016, and I've been in the United States ever since.

Juliette Sellgren (8.27)
Can you talk a bit about how, this is maybe going to sound weird, the speed at which you saw all of this purchasing power disappear. How did it feel and what were kind of the dynamics going on when that was happening? Because I think especially when we talk about economics, and particularly for people who don't really understand economics, it's hard to imagine being there experiencing that because it kind of happens in the blink of an eye- hyperinflation. And I don't know, part of me thinks that the way to have people understand something such as inflation and the effects of it and why institutions, especially governmental institutions are so important, is to kind of be able to visualize yourself in that situation, even though hopefully you never will be. So I don't know, how fast did it happen? What was it like? Do you think you had to grow up even faster than people in America who haven't faced this sort of thing?

Daniel DiMartino (9.41)
Well, let me give you some examples. As any teenager we would have in a school, we would have cafeteria in the school. Well, there are several aspects to what happened economically to us. One very salient aspect is the inflation. That means the rising prices. So when I mean rising prices is that the prices would change every week. It wasn't by Germany where they changed every hour or something like that. So they would change every week or every several days. And so it would change so fast that, or coins or cash, which become worthless. And so the government would have to print new bills and change the currency so that we didn't look like Zimbabwe where they print billions of dollar bill. They just cut off zeros from their currency. So if you made a monthly wage of 1000, next month, you'll make one of 100 and every price will be divided by 10.

But they did that divided by 1000 and then divide 'em by a hundred thousand. And so they took off a lot of zeros, but a lot of zero just matched the inflation and made accounting easier. But it became so bad that just we couldn't fit enough cash in our pockets to buy say something, anything in the cafeteria. So you had to use debit cards, but then the machines were all imported for the scanners or for the debit cards. So when they went broke, because the government controlled the imports, you couldn't replace them. And so it was a huge problem. You couldn't pay, and so you had to bring bags of cash with you. And that's how people withdrew money from the bank. They brought a backpack and they put the backpack full with cash. And that's how you would know somebody's coming from the bank because they had a backpack in the street, which is a problem, right? Because they would rob you though. It depends, right? You don't know how much money there is. The cash isn't really that much, so it's not like you can rob that much cash. It's much more valuable to rob people's phones and shoes and clothes. And they did that, by the way, there was a band, a criminal band. This one was really scary because they looked for women who had long hair. And Juliette, I kid you not, they had big scissors and they would steal women's hair.

Juliette Sellgren 

Daniel DiMartino 
Sell it. Yes, I know.

Juliette Sellgren 
How valuable is hair?

Daniel DiMartino 
You sell hair for wigs in Colombia. So they took the hair to Colombia or neighboring country and they made money.

Juliette Sellgren 
Yeah, I mean, I guess that shows you just how bad. I know wigs can maybe get expensive, but still, if that's the point that your economy is at…

Daniel DiMartino (12.30)
Well, it's free for you, right? If you're the robber, you are taking it at no cost, right? Nobody's going to resist if you have a huge scissor and a gun. So you just take people's hair in. The profit margin is 100%. So they did that. The other things that, so that's with inflation, and it happened pretty quick. Inflation maybe when I was very young, was like 10% a year, then 20, then 30, then 50, then 100, then 200, then a thousand, then a million percent suddenly. And that's, I think it peaked in 2019 after I left. And that's when it became so bad that I just stopped tracking the exchange rate and everything because it was so difficult to track. Everything changed every day so that people have an understanding of 1000000% inflation means the cost today, $10 cost 20 extra week, then 40, then 80, then 160, then 320, then 640 and so on. So you quickly get into multiplying every price by thousands and thousands cents of thousands in a year.

Juliette Sellgren 
That is wild.

Daniel DiMartino (13.42)
So that was the inflation. The other aspect that was really severe was the shortages. This one perhaps was worse than the inflation because it meant that you just couldn't get the, how would I say it, almost as if you couldn't notice it, your favorite brand of cereal would disappear, like, oh, I haven't seen this in a long time. Where do you think this? What happened to this? And then the yogurt and then some other product. And then the government would take over a milk processing facility, and then the same milk would be produced, but then it would have a red part on the milk that said, made in socialism, and then the milk would be bad, which is made, right? It's made in socialism, so it sucks. And then it would just disappear because the company will go broke. And so those things which are happening, and then you start making lines, and then there's to ration, because the lines get so severe, the government implements a rationing system where you get assigned day of the week for the grocery store. Then it gets even worse, not just a day, but you have to put your fingerprint. And then in the fingerprint scanner, they tell you how much you can buy of what. And so that's what high tech socialism looks like.

Juliette Sellgren 
And what was that based off of?

Daniel DiMartino 
Well, they just gave everybody the same quota. 

Juliette Sellgren 
Oh, okay.

Daniel DiMartino 
Everybody was, but they could track to make sure, sure that you were. I say everybody got the same quota. If you were an employee in the grocery store, you just got whatever you wanted right before they gave quotas. So I would be in high school and the teacher would receive a call from a friend that works at a grocery store, and then she would know when the next product delivery is coming, and she would show up right before then. And so she would be first in line. So there were a ton of instances like this. Shortages became so severe that when we started gifting each other things for special occasions, you know what? We gifted each other food. We started giving each other products that disappear that are hard to find as gifts. How sad that you give somebody as a birthday gift, flour and soap.

Juliette Sellgren 
So that's not a world I want to live in.

Daniel DiMartino (16.17)
That's right. A big company worldwide. And they existed in Venezuela. They made a lot of products, right? Soaps and food, and so many things. The company compensated its employees, surely with whatever small wage that employees received in Venezuela, and then a bag of products every month. That's why everybody wanted to work at Proctor and Gamble, because it was very difficult to find the products who are high demand, very useful. And so the workers were very happy. And those people, those families had everything they needed usually.

Juliette Sellgren (16.51)
Yeah. Well, so what was the atmosphere like where you have people running around with giant scissors, cutting off women's hair, and some people get favors that aren't necessarily fair? It's who? And if you work for the government or you're lucky enough to land a job where you probably put in more work than people who are out of work, but you're compensated nicely in things that you need that you just can't provide for yourself, they don't exist. What are the people like? Are they happy?

Daniel DiMartino (17.34)
Well, Venezuela, look at how interesting this is. Venezuela used to rank among the happiest countries in the world 20 years ago, and not just the happiest, but the most patriotic.  Up until the early two thousands, the two most patriotic countries in the planet were the United States and Venezuela. How do they measure that? They measure it as the share of the population serving that responds. My country is the best country in the world. In the United States, it's a pretty high share. I'm not sure it's as high anymore, but in Venezuela was a pretty high share too. That obviously is not the case anymore. Nobody can objectively say that Venezuela is the best country in the world. Nobody, even if I love Venezuela, I would be mentally ill if I said that Venezuela is the best country in the world because objectively it's not. It's destroyed. It's a horrible place to live, and that's why people leave the country.

And so Venezuelans changed and with crime, because Venezuelan became a very dangerous country because the government stopped enforcing rules against criminals. They packed the courts. Nobody went to prison. Nobody goes to prison really for violent crimes. And gangs rule many parts of the country. So there would be s to deceive people. There will be a lot of kidnappings and robberies, and I dunno, a motorcycle would stop by your car and then knock on your window with their gun and give me everything you have, and then you have to give it to them. And every day was like that. Many people got robbed, sometimes more than once a day. And then we laughed at them because they were just very unlucky.

The mom of one of my high school friends one day got robbed three times. And it's like, man, what is she doing? Where is she hanging out? Has she not learned? You know what I mean? Run and hide. Yeah. How lucky you have to be to get robbed three times in a day. But these things happen. Everybody was robbed at some point in their lives or kidnapped or being a victim of a crime. And so there will be roos developed called the Chilean packages, es chilenos in Venezuela. I don't know whether they're called Chilean, but that's the name. And somebody would say something would happen in the street in front of you, say an old lady falls, right? And what would you do if you see an old lady fall here? You would go and help her, right? Yeah, obviously. Well, in Venezuela, this was not actually an old lady falling.

This was all a ruse so that they could steal your wallet while you were trying to help the lady. So imagine what that creates, right? That there's always people trying to deceive you and rob you, that there's always somebody bad around the corner, that there's somebody who works for the government and is going to rat on you or whatever. It creates mistrust. It erodes social trust in the population. And so we went from a happy, very trustful, very amicable, very patriotic society to a very sad and deceiving and lying society. That's what we became. And it's a sad thing, but government policies can actually change culture in a very radical way when these things happen.

Juliette Sellgren 
And that was democratically elected, even if it wasn't…

Daniel DiMartino (21.03)
When there are shortages of food, you are not friends with the other person who is in the grocery store. You are their enemy because you are competition, your competition for feeding your family, and your family is above strangers, therefore, you don't trust strangers. You don't want to help strangers find anything. You just want to get the hell out as quick as possible with whatever you need. And so a lot of fights would break out in grocery stores in Venezuela, a lot of fights. Sometimes it would be stampedes and people would die. My dad, one time, me give you an example, we had brought toilet paper to the cashier, and turns out the cashier had scanned the product and charged us. And then she found out that by mistake, because it was her mistake that we didn't have the quota allowed to buy the toilet paper.

It wasn't allowed, but she had already charged us. And so she said, we have to return it. My dad said, I already paid for it. I'm not returning it. And so she said, well, then I need to call the National Guard because there will be national guard officers on military uniform in grocery stores. Juliette, that's how dystopian this is. And my dad said, oh, really? Well, if I can't enjoy it, then nobody's going to wipe themselves with it. And then he opened the toilet paper and then he threw it all to the floor. 

Juliette Sellgren 
Wow, that's ballsy.

Daniel DiMartino 
Well, he did what I felt like he should have done, but at the same time, it was an unnecessary risk for the family, I will say.

Juliette Sellgren 
Yeah. Did he get in trouble for doing that?

Daniel DiMartino 
No, we just left. We were fine.

Juliette Sellgren (22.43)
What you said about competition within the grocery store of you and the other shoppers, it strikes me that this is economics at play, which is funny because usually proponents of socialism, communism, anything progressively centralized, they say it's the end of economics. We don't need markets, we don't need market mechanisms. But I think what they miss out on is that everything is a market. Just because you get to be the buyer doesn't mean that just because you're the buyer in most free market systems as a consumer, doesn't mean that that goes away when you are in a socialist situation, you're just competing still. That's right.

Daniel DiMartino (23.37)
There's always competition. And the question is, if you want a healthy society, you need abundance. Because if there's scarcity everywhere, there's very acute scarcity, then everything is a competition. We don't see other Americans here as our competition for eggs in a grocery store because there's so many eggs, there's plenty for everyone. So we don't have to be concerned whether there will be eggs in tomorrow in the grocery store. We don't have to hurry and hoard things. We became hoarders in Venezuela, of course, because we didn't know what was going to be available later. And the government blamed the shortages on hoarding, by the way. And if they found that you had things stored, they would persecute you and put you in prison, which is ridiculous because that's not the reason we had shortages. The reason we have shortage is the government took people's farms and businesses and controlled imports and exports, but that's what, and put price controls.

So they made it unprofitable to produce. But that's what happens when there are a few things available. You see it in animals, right, in the animal kingdom, because everything, they're not smart, so they don't produce. They just go around and try to find things, predators fight with each other for their prey, and they kill each other for territory. Why don't we do that anymore as humans, as we used to when we were in caves because of free markets, because we have so much abundance now that that has fostered an environment of peace and trust.

Juliette Sellgren 
Free markets are humane. How do you respond to and gauge with proponents of socialism especially, well, maybe not especially because you can't untie it from your lived experience, but given your experience, how do you engage with them? And is it different from other free marketers, do you think?

Daniel DiMartino (25.29)
Well, there's two types here. There's the people who are simply misguided about what they think socialism is. And those people are very easy to talk to because if you are one-on-one with them, you can go for the facts and you can talk about it and more accessible government health insurance or something like that. So those are very easy to talk to. The people who actually support say what Venezuela does. Well, those people, I don't really, there's no way of persuading people who support killing others for their property like that. If you support the system in Cuba, in Venezuela, then in my opinion, you are a danger to society. And those people should be sent to Venezuelan and to Cuba. No questions asked. 

Juliette Sellgren 
And I know you can have it.

Daniel DiMartino (26.21)
They're not going to persuade them. Well, look, if I'm talking about people who are informed of what they're saying, and this is not a big group of people, but it's a powerful group of people. It's people like here in New York City where I live, there's a group called The People's Forum, okay? This is a group financed by the Chinese Communist Party, by the Cuban Communist Party on by Venezuela. And they were part of a rousing, the protests at Colombia. This is all been reported. Now, there's a whole New York Times investigation about the CCP money get, I went to an event they hosted two years ago where they brought people who work for the Venezuelan regime. If you go inside their building, because they have a whole space in Manhattan, in a nice area in the Upper East side, that must cost them, I dunno, tens of thousands in rent. Every month they have pictures of Avara, of Don, of Stalin, of Madura, of Castro. These are not good people. These are evil people. These are criminals who would kill us if they had a chance.

Juliette Sellgren (27.28)
This is a really, really bad analogy, but it's like when vegetarians are like, oh, but the pigs are so nice and cute. And I'm like, but the pigs would kill you if they could. They would eat you. They would do. And so I don't know. It's silly analogy maybe, but…

Daniel DiMartino (27.44)
Well, but the point is there's two types. There's the misguided folks and the evil folks. Most people are misguided, not evil. And the question is, how do you get to what they actually want in a society? There's people who are more radical than others. There's people who, for example, believe that they simply have a huge dislike for inequality. And to those people, we need a more philosophical conversation, more than a practice, meaning they just want all these things guaranteed to people because they think these are good things. They just want to make the poor better off. And we can talk about what's the best way to do it. I think that's free markets. And there's the people who are socially out of philosophy, they simply think, rich people shouldn't be that rich, and we need to actually make the rich worse off and we need to be all equal of results, or the government should regulate how equal we are. Because the all knowing government should determine that. And to those people, you need to have a conversation. What is the level of equality? What's the maximum decide level? That's an important question. Why should you get to be God? Because that's what socialism is. Socialism is replacing our God with government's God.

Juliette Sellgren 
It's really presumptuous is what it is, and dangerous, it kills people. So let's talk about one of those things that I think actually leads to prosperity and makes us all better off immigration. Wow, what a smooth segue. Okay, so you immigrated here, obviously, but also that's a lot of the stuff you work on. What are a lot of the misconceptions we have about immigrants and what happens? So you have Venezuelans who become distrusting when they're there, but say they come seek asylum in the us. Do they adopt our culture and become trusting again? What happens there?

Daniel DiMartino (29.40)
Well, I study immigration because I think that that's really the most important policy issue of our time. High school immigration, innovators, entrepreneurs who come from abroad are really the driving force behind our productivity growth, I believe, and I want to enhance that. I want America to be the home of the smartest people in the world. I think of America as a really exclusive association of members. I think this is a better way to think of a country. It's an association of people in which we inherit membership in the association because the children of Americans are Americans. Everybody born here is an American. So the way to obtain membership in this association is to be born here or be the children of somebody who is from here or to apply for membership. That's the immigration process. And who do you want as a member of your private association?

You want really good people. That's how clubs are formed. And the question is, is America doing a good job at regulating entry to the association? And I don't think America is doing a good job. I think we actually exclude a lot of the smartest people, and we let through a lot of people who are not going to be productive members of the association, of the country, of the nation. And so those are the two reasons why I think immigration is a really important issue. The big misconception I think, is that immigrant, there's a lot. The economic misconceptions are the biggest ones, as in the biggest problem of having  a ton of immigrants is wages for American workers. That's not really the case. The issue is the fiscal cost of them. If they're really poor and low skilled, if you are somebody who is an Uber driver for your whole life as an immigrant who never learns the language, you are going to be paying very little in taxes throughout your life, and you're going to receive a lot in welfare benefits, but even more in really social security and Medicare.

So you're going to be a net liability to the society. That's a problem. But it's not because they lower the wages of Americans in general, because that's not how we think of immigrants. Immigrants aren't just machines that work. They're consumers, they create new things, they, and then capital adjusts. The economy isn’t static where there's just more workers and everything stays the same. If there's certainly a ton more workers and wages say, go down temporarily, then employers have a huge incentive to expand and hire more people and invest more in machines that make us more productive, and therefore wages go back up. So all the literature finds that even with the small wage effects that we have from immigration, these wage effects are always temporary of a few years. So each migrant wave really disappears that we should be thinking about isn't wages, isn’t jobs, is this person going to innovate and create new things and it's going to have a positive externality? Or is this person going to have a negative externality? Are they going to be a criminal? Are they going to be a public charge? Meaning are they going to receive a ton of welfare and things like that? That's the criteria that we should be thinking about. Also, social criteria, cultural criteria. Do they speak English? Do they love or do they hate America? Right? No, no. Private association would admit somebody who's applying, who hates the association. So this is how I tend to think about immigration.

Juliette Sellgren (33.26)
And I guess to give an example for that welfare thing, the United States is not really like France in a lot of ways, but in France, you are entitled to the second you step foot on the land in the office. You don't have to have any plan to become a French citizen. You don't have to have a visa necessarily. However you get there, you show up, you're entitled to tens of thousands of dollars. Well, it's yours. And where does that money come from? What you're getting is a lot of it's like a magnet for people who don't want to work, and this is not to say it.

Daniel DiMartino (34.02)
And that's what we have right now, by the way, in many parts of the United States, because democratic states and cities, many of them have decided to offer free housing and free food to illegal immigrants coming to the country. And the consequence is that more people are coming to the country and they are ripping off the taxpayer.

Juliette Sellgren 
Yeah. So can you elaborate? What does the situation look like on the whole, what is the federal response? What states are responding? 

Daniel DiMartino (34.28)
How about 2 million people coming in every year since 2021? That is not the number that you see on tv, which is much higher, but that's because a lot of people get immediately deported and the TV host and all that stuff, they don't count that. And that's important because we want to know the actual number of people who stay, not the number of people who step in and then get turned back. So it's 2 million a year, which is a huge number. It's the record since maybe the 1980s. And then before that, I don't think we ever had those numbers of illegal immigration coming. New York City has a policy where everybody who shows up has right to shelter, and they're put in a hotel that costs 300 bucks a night on average, more than that, and they get free food too. Debit cards. A family of four gets $1,400 a month.

That is more than any welfare benefit, food stamps that poor people who are American get. But even if it was the same, it would still be unfair. Nobody's entitled to receive anything from taxpayers. I think certainly not somebody who just showed up to the country. Even if they claim Juliette, when the United States had free migration in the 19th century when Ellis Island was open and the early 20th century, there was no welfare system. There was no entitlement system. Social Security and Medicare didn't exist. But also there were no food stamps, no nothing. The people who came here and didn't make it, they didn't find jobs. They would starve if they didn't go back. And so they went back. The people who didn't make it, we had some sort of natural selection in our immigration system because only the best were able to make it, and the rest had to go back.

We don't have that anymore in America because leftist states and local governments don't want to feel bad about making people have to go back if they don't make it. And they think it's compassionate to try to help people do that. But the reality is that if you apply that principle uniformly, you get what happens in New York, which is hundreds of thousands of people showing up to get government benefits. And right now we have about 100,000 Juliette, illegal immigrants living in government shelters in New York City. They are consuming about three to 4% of the city's budget. And this is a pretty big city budget, much bigger than it should be. They're having to cut police officers, they're having to cut firefighters, trash collection, public parks, and public libraries in order to pay for illegal immigrants; teachers, too. So it is a big problem, and I think that that's the big picture, that this doesn't happen in red states.

Miami has received more illegal immigrants than New York City. Nobody's starving to death in Miami. Nobody's living on the street in mass in hundreds of thousands, and even before 2020, I don't think I've met any illegal immigrant who was homeless in the streets. Now the leftists are telling us if we don't give them free housing and they're all going to be homeless, that's not true. People have come here to work illegally for while over a century, and they didn't go homeless or starved because when they did really bad, they went back to their home countries, and that's how it should be. You are not guaranteed as an American, say you live in Oklahoma and you want to move to Nebraska that you are going to, if you don't make it, then we'll give you free housing in Nebraska, so you don't have to go back to Oklahoma, right? No, you go there voluntarily. Nobody's forcing you.

Juliette Sellgren 
Yeah, it is. When you use that analogy, it is a little silly, and I feel bad, but you're right,

Daniel DiMartino (38.23)
There are 8 billion people on the planet. You know how many millions of people are under oppression on extreme poverty, less than there were before. So we just keep everybody housing and bring them to the United States because people, I feel bad. I think we have a duty to actually spread freedom and help people, but we simply cannot afford to bring everybody to the United States and pay for them.

Juliette Sellgren 
Yeah. It's about long-term sustainability. So last week I had this conversation about terrorism and long-term terrorism prevention, and we were talking about how institutions are really important and economic growth, and actually allowing people the tools to uplift themselves and handing things on a silver platter is just not that you don't learn that way. And I don't know, I see it as kind of a similar thing. This is not at all to compare immigrants to terrorists. 

Daniel DiMartino 
I love it. No, no, no, no, don't worry. 

Juliette Sellgren 
I understand. But in terms of using economics to see what actually works for prosperity, you need to help people help themselves. It's you give a man a fish, he starves the next day. If you teach a man to fish, he'll be fed his whole life. 

Daniel DiMartino (39.35)
It's the same thing. The Democrats are saying that the way to solve this thing with illegal immigration is just to let people work legally and look as much as I think we need to stop the flow at the border, but the people who are here, I do think we need to let them work. The people who have been allowed in already, but they're already working illegally, many of them already actually have work permits through asylum applications and temporary protected status. Another way that they get this and they're still living in the shelter because why would they stop living in the shelter? It's free housing in a hotel room. Juliette, why would they stop? New York City is a pretty expensive place. If they didn't get free housing, maybe they wouldn't be in New York City. They moved to another city where there are more jobs. What's the unemployment rate in Utah and South Dakota? It's 2% in New York is about 5%. Perhaps they would move to places where there are more jobs, lower cost of living and better wages. We are distorting the resource allocation in this country with these policies of labor and of cap.

Juliette Sellgren 
Yeah. So what are some of the main takeaways that we should have and maybe some policy recommendations or guidance that you think are prudent?

Daniel DiMartino (40.54)
Well, number one, a lot of people are misguided over how to secure the border. They think a new president can just come in, sign a new executive border, and border patrol will return everybody back to Mexico and where they came from, that's actually not going to happen. It didn't happen when Trump was president, and it's not going to happen if he becomes president again, at least not unless Congress acts. The realities that under the US Immigration or Nationality Act, everybody who's physically present in the country has a right to apply for asylum and have their claim heard. And because we only have 700 immigration judges and over 4 million pending cases, it takes years to review a case.

While that happens, we can keep somebody detained for that time, so we just release them. Now, people say, well, let them wait in Mexico. Nobody's going to wait for seven years in Mexico. They're just going to cross until they get in illegally without being caught. Well, then we'll build the wall and then they will have all technology. This is one of the longest land borderers in the planet. People will get through. Believe me, right now, we have one of the lowest got away rates and still like a hundred thousand people a month get away from border patrol. So it's not easy. We need Congress to actually appropriate the resources to review Asylum Place very quick, and while they're reviewed very quick, we can detain people at the border. And for that, we also need money for the tension bets, for judges, for food, for all those things to keep people a few weeks at the border.

And that requires congressional action. That's on the illegal immigration front. And then we need to recognize that we need a lot more smart people, and we let very few people in based on their skills. We let almost everybody in based on luck or family ties, which are basically also luck too. So we need to expand the number of people who are millionaire investors, business owners, entrepreneurs, innovators, people with PhDs, people with master's degrees in critical fields. We need a lot more of that. We let very few people through that way, approximately five, 6% of all green cards, so maybe 50, 60,000 green cards a year. We should be given four times as many as that. We wouldn't need to have 2 million more illegals a year. That could go down tremendously. And then when to come to a recognition that deporting the people who've already been through illegally is going to be impossible because

Juliette Sellgren 
It's like getting rid of guns. You just can't do it.

Daniel DiMartino (43.34)
Yes, exactly. Well, perhaps, yeah, I dunno what's harder. That's a good comparison. It's harder because an average deportation costs over $15,000. Juliette, if we assume that there are 15 million illegal immigrants right now in the US after everyone that has come through, then that would cost 225 billion. But that's actually a big underestimate because it's 15,000 on average of the few people we deport a year now, which is a hundred, 200,000 a year, the marginal cost of deportation for all these additional millions is much more than that. It's increasing marginal costs. So perhaps the cost of real mass deportation is $1 trillion. Juliette, that is a quarter of all federal revenue. We don't have the money to do that. That's more than the budget of the Department of Defense, much more the only way, and also the question is even if we had the money to do it, suddenly it appeared from the sky.

Would it be the best investment of our resources? Because if they are not going to cost us a huge cost of say, 30,000 or $50,000 each of them, then it's not worth investing that same amount of money to the port them. It's a cost benefit analysis. So we need to deport everybody who's a criminal, who's a public charge, people who are negatives to the country, but everybody else, and that's millions of people. We need to allow them to stay legally in this country, perhaps not become citizens. That doesn't really matter to them. They just want to have peace that they won't be deported and are legally here and work. That's what we need to do. That's what would be best for the Americans. Not talking about what's best for the immigrants. It's what would be best for Americans.

Juliette Sellgren 
Yeah. I have one last question for you. Thanks so much for taking the time and for sharing all of your insights and your wisdom and your stories, and that is what is one thing that you believed at one time in your life that you later changed your position on and why?

Daniel DiMartino (45.37)
Yeah. Actually, I believe that marijuana should be legal. I had been convinced by this lecture by, I think he was the chair of the Department of Economics at Harvard, and at first I think marijuana is a terrible drug. I never used it. I would never want to use it. I think people should never use it, but I think that about most drugs and a ton of things that are legal, I think alcohol is terrible for your health. Cigarettes are terrible. I would never do it. I have never done it, and I don't think people should, but I don't think cigarettes should be illegal.

But I used to think, and so he convinced me about the marijuana stuff because he said that the war on drugs was very costly and in prison and all of that. But now I think very differently. I think actually it should be legal. You shouldn't go to jail for it. But the reality is that almost nobody really, nobody's actually in federal prison because of marijuana. We know this because Biden supposedly commuted the sentences of everybody who was federal prison for marijuana, and what was the number of people who got out of prison from his pardon? 

Juliette Sellgren 
How many?

Daniel DiMartino (46.47)
Zero. It was purely symbolic. Nobody's in federal prison just because of marijuana charges. Maybe they have a marijuana charge on their criminal record, but they're not in prison because of it. They're in prison because of guns, because of killing, robbing other things that go with the marijuana. And since moving to New York City and seeing how every single street smells like pot, man, it's unacceptable. There are some blocks in Midtown Manhattan that have more than one pot store each every block. Where are all these consumers? Where these, is this money laundering? I don't understand. There are more marijuana shops than coffee shops. So you'd say, well, Daniel, that's you imposing your preferences. No, it's affecting me. I did not consent to smell marijuana on the street. I want my street clean and smelling well. Okay? And so I think people should be allowed to do whatever they want in their home, in their own property without affecting others. That's a very actually classically liberal position. But as soon as you're going to affect me, then no, you should not be allowed, and you should be fined for publicly smoking. Not just marijuana, but cigarettes, just like it's illegal to drink in an open container than you smoking. Actually.

Juliette Sellgren 
Once again, I'd like to thank my guests for their time and insight. I'd also like to thank you for listening to The Great Antidote Podcast means a lot. The Great Antidote is sound engineered by Rich Goyette. If you have any questions, any guests or topic recommendations, please feel free to reach out to me at Great antidote@libertyfund.org. Thank you.

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