PAUL KRUGMAN: THE ROAD TO DUBAI

For now, at least, the immigration issue is mainly hurting the Republican Party, which is divided between those who want to expel immigrants and those who want to exploit them. The only thing the two factions seem to have in common is mean-spiritedness.

But immigration remains a difficult issue for liberals. Let me say a bit more about the subject of my last column, the uncomfortable economics of immigration, then turn to what really worries me: the political implications of a large nonvoting work force.

About the economics: the crucial divide isn't between legal and illegal immigration; it's between high-skilled and low-skilled immigrants.

High-skilled immigrants — say, software engineers from South Asia — are, by any criterion I can think of, good for America. But the effects of low-skilled immigration are mixed at best.

True, there are large benefits for the low-skilled migrants, who may find even a minimum-wage U.S. job a big step up.

Immigration also raises the total income of native-born Americans, although reasonable estimates suggest that these gains amount to no more than a fraction of 1 percent.

But low-skilled immigration depresses the wages of less-skilled native-born Americans. And immigrants increase the demand for public services, including health care and education.

Estimates indicate that low-skilled immigrants don't pay enough in taxes to cover the cost of providing these services.

All of these effects, except for the gains for the immigrants themselves, are fairly small. Some of my friends say that's the point I should stress: immigration is a wonderful thing for the immigrants, and claims that immigrants are undermining American workers and taxpayers are hugely overblown — end of story.

But it's important to be intellectually honest, even when it hurts. Moreover, what really worries me isn't the narrow economics — it's the political economy, the effects of having a disenfranchised labor force.

Imagine, for a moment, a future in which America becomes like Kuwait or Dubai, a country where a large fraction of the work force consists of illegal immigrants or foreigners on temporary visas — and neither group has the right to vote.

Surely this would be a betrayal of our democratic ideals, of government of the people, by the people.

Moreover, a political system in which many workers don't count is likely to ignore workers' interests: it's likely to have a weak social safety net and to spend too little on services like health care and education.

This isn't idle speculation. Countries with high immigration tend, other things equal, to have less generous welfare states than those with low immigration.

U.S. cities with ethnically diverse populations — often the result of immigration — tend to have worse public services than those with more homogeneous populations.

Of course, America isn't Dubai. But we're moving in that direction. As of 2002, according to the Urban Institute, 14 percent of U.S. workers, and 20 percent of low-wage workers, were immigrants.

Only a third of these immigrant workers were naturalized citizens. So we already have a large disenfranchised work force, and it's growing rapidly. The goal of immigration reform should be to reverse that trend.

So what do I think of the Senate Judiciary Committee's proposal, which is derived from a plan sponsored by John McCain and Ted Kennedy?

I'm all in favor of one provision: offering those already here a possible route to permanent residency and citizenship. Since we aren't going to deport more than 10 million people, we need to integrate those people into our society.

But I'm puzzled by the plan to create a permanent guest-worker program, one that would admit 400,000 more workers a year (and you know that business interests would immediately start lobbying for an increase in that number).

Isn't institutionalizing a disenfranchised work force a big step away from democracy?

For a hard-line economic conservative like Mr. McCain, the advantages to employers of a cheap work force may be more important than the violation of democratic principles.

But why would someone like Mr. Kennedy go along? Is the point to help potential immigrants, or is it to buy support from business interests?

Either way, it's a dangerous route to go down. America's political system is already a lot less democratic in practice than it is on paper, and creating a permanent nonvoting working class would make things worse. The road to Dubai may be paved with good intentions.