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FEDERAL RESERVE BANK CHAIRMAN HAILS IMMIGRATION'S IMPACT ON ECONOMY
During a speech given on Thursday January 13, 2000, Chairman of the Federal Reserve Bank Alan Greenspan clearly indicated that there would soon be a rise in short-term interest rates.  Ordinarily such news does not concern immigration issues, but that is not the case here.  The Federal Reserve Bank is the central bank of the US and controls the nation’s monetary policy.  Many people credit Greenspan’s policies for the sustained economic growth over the past decade and Greenspan was recently reappointed to steer US monetary policy for the next several years.  During Thursday’s speech, Greenspan spoke of the role of immigration in the economy’s past performance and the role it could play in the future.
Speaking of the growth of consumer demand in the US, Greenspan worried that meeting that demand would require either an increase in the amount imported into the US, or by producing more goods domestically.  He said that the second solution would require more workers, many of who could be gained by increasing immigration.  He then noted that this has already been done, and that the use of immigration to alleviate pressures on the US labor market is subject to constraints imposed by immigration law and enforcement. 
In concluding, Greenspan said that if it could be certain that economic growth could continue to be driven by gains in productivity and increases in the available worker pool through immigration, there would not be the fear of inflation that exists today.  Because of this uncertainty, and because of the need to avoid inflation, interest rates will likely rise within the next month or two.  Greenspan’s comments show that immigration is an issue that has far more impact on the economy than is ordinarily assumed, and effects it in ways not normally thought.