German Chancellor Angela Merkel frequently used the slogan “wir schaffen das” (we can handle it) to summarize why Germany was allowing so many migrants to cross its borders. However, Germans are becoming increasingly skeptical of their ability to do so. Additionally, certain nations have actively refused to receive refugees. Denmark, for example, went so far as to publish advertisements in Arabic discouraging refugees from attempting to enter their nation. Other regional and national European leaders force refugees to return to a registration office at a distant time in the future as a method of deterrence from integration into the host nation. Some political leaders in Germany believe that the nation should follow suit and close its borders to new refugees. In spite of this pushback, Germany may end up with better long-term benefits if they choose to embrace the influx of refugees.
One of the most frequently used arguments to support keeping borders open is a humanitarian one. It is evident that the migrants’ trips are catalyzed mostly by the civil conflict in Syria and the advance of ISIS and other militant groups in the Middle East. The political instability causes, in turn, economic stagnation, which rapidly and drastically deteriorates the already poor quality of life for many in these nations. Many asylum seekers attempt to reach Germany as a final destination due to the country’s economic development and generally welcoming attitude towards refugees. And many argue that those nations who can help, like Germany, should do so.
With that said, there are also more tangible economic reasons to accept refugees. Germany and many other European nations have among the lowest birth rates in the world. In the future, this will likely be an issue in supporting welfare programs, as there won’t be enough workers contributing to the economy to sustain benefits. An influx of new persons capable of working would mitigate this issue. Furthermore, the quicker refugees can integrate within their host nations’ borders, the sooner they can contribute to the economy instead of waiting for work authorization. In other words, more bureaucracy leads to higher costs to the host nation.
Another potential concern that natives may have is that such a high influx of refugees may harm the economy. Recent research indicates, however, that this is not the case. The University of Oxford Refugee Studies Center released a paper which found that influxes of low-wage immigrants actually tend to raise wages for everyone else. In other words, accommodating new workers such as refugees would actually result in a positive economic results for native workers. The reasoning behind this is that as low-level workers enter the country, natives can assume higher level positions. Furthermore, economists from the IFO Institute for Economic Research and University of California Davis discovered that, out of 20 nations, immigration benefited the native population in 19 cases. These economic reasons to accept refugees should be especially appealing to European economies, which are trying to incentivize spending by entering negative interest rate territory.
This effect isn’t unique to Europe either. The U.S. Congressional Budget Office released a report in 2013 that also highlighted the benefits of integrating foreign workers. The report estimated that creating a path to citizenship for foreigners could lower the federal budget deficit while boosting GDP by 5.4 percent over 20 years.
With all these potential economic benefits of welcoming refugees, one might wonder why many European politicians refuse to do so. Some people, including refugees, fear that the influx of people might result in the proliferation of terrorism. However, there are no credible examples to substantiate these fears. It seems that most recent terrorist attacks in France and Belgium were conducted by long-term residents of these countries, not recently arrived refugees.
It is indisputable that the rapid influx of refugees in Europe will disrupt many Europeans’ lives. The crisis may also come with the one-time costs of integrating refugees, so it is understandable why one would be hesitant to accept so many new migrants. Fear is also understandable due to the various tragic attacks that have occurred on the European continent. With that said, the current refugee crisis is a moral and an economic opportunity for potential host countries. If Europe is indeed able to effectively and efficiently handle the influx of refugees, there will be multiple benefits for native populations and economies. If Merkel is correct and she and her country can indeed schaffen das, then Germany stands to gain much over the coming years as a direct result of their welcoming stance in regards towards refugees.