The Milken Institute debate that was highlighted in an earlier article, Common Stock Legend Disavowed: Professor Siegel’s Epiphany, brought into focus two opposing views regarding the possible negative impact on stock prices to be caused by the retirement of the Baby Boomer generation.

Michael Milken, the Chairman of the Institute, took an optimistic stance, suggesting that the problem would probably resolve itself through improvements in technology and productivity enhancements.

Linking economic stability and growth to enhanced productivity and new technology is a popular theme among economists, including ex-Federal Reserve Chairman Alan Greenspan.

Productivity and Technology Can’t Save the Baby Boomers

As described in the essay, “Profits and Population“, American economic growth over the last fifty years has had more to do with the expansion of the number of people working in the money economy than with advances in technology and productivity.

The initial impact of productivity improvements and new technology is to put people out of work.

Unless government policy and societal customs encourage education, savings and investment, and entrepreneurial activity, higher paying new jobs will not be created fast enough to employ workers displaced by productivity enhancement and new invention.

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No one knows for sure the facts on illegal immigrants living in the United States.

Nevertheless, lets start with one common estimate of the illegal population: 12 million persons.

Now, some have suggested that the U.S. deport these twelve million people, sending them back to their land of birth.

Lets assume that illegal immigrants will not pay any of the costs of this mass deportation, which would fall upon U.S. taxpayers.

What would be the economic consequences of mass deportation of 12 million illegal immigrants?

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Legal immigration has resulted in solid growth of the U.S. population, despite declining birth rates and an increasing number of old people.

This is good news for investors in stocks and real estate .

(See: “Profits and Population“)

Despite loud railing against illegal immigration by Bill O’Reilly, Lou Dobbs, and Pat Buchanan, the real story is the size and scope of legal immigration, as the graph indicates.

	US Legal Immigration

Illegal immigration appears to be less than 5% of legal immigration, and legal immigration is at an all time high.

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