One word: Immigration.
Now is not the time for the United States to keep people out of the country. China and India are picking up a lot of growth and becoming more desirable places for people that want the excitement of a developing country with modern ammenities. They are creating and re-attracting more scientists and engineers than ever.
But the United States is also a very desirable place for it's relatively little corruption, ease of doing business, and the ability for people to reinvent themselves and create a new life. The draw of the US as a place of opportunity is something the United States shouldn't limit to 500,000 people a year, instead we should start opening the floodgates. For the next 20 years, we should let in 30 million people a year, and for the 20 years after that, we should let in 50 milion per year. In 2051, the population of the United States would be over 1.1 billion, rivalling that of India, China, and the continent of Africa. The United States is destined to being a second-rate world power to India and China? No thanks.
Crazy, you say? A republican government with democratically elected officials was a crazy idea 225 years ago, so why should we stop now?
Here are some cold, hard numbers.
In January, it was reported that of the 131 million housing units in this country, only 112.5 million are occupied. That leaves 18.5 million units of housing that are currently vacant. If 30 million people immigrated this year, we would no longer have a housing downturn. The only way for us to fill all the homes is to boost the population. Hello construction jobs!
In 1997, David Pimentel, professor of ecology in Cornell University's College of Agriculture and Life Sciences, reported that at the United States's then yield from grain output that the US could feed 800 million people. With additional gains in agriculture yields, we could feed many more. So for anyone that doubts the US's ability to feed all those people I recommend letting in, you are mistaken. For example, the EPA shows that 80% of all the corn, 30 million tons of soybeans (~46% of the entire yield based on 65 million tons), and 22% of all wheat produced in the United States goes to feed livestock.
Not only would the housing vacancy problem be solved and not only could we feed all those people, but by letting in an additional 800 million into this country we would also almost quadruple the demand in the domestic market. Imagine each year 30 million new consumers being added to the domestic market, that's almost like getting access to another California each year. Each year those additional people would need housing, food, clothing, transportation, and entertainment. We could go on the greatest building boom in history. 800 million additional people means greater density in our cities, more jobs to support the population growth, greater access to talent and entrepreneurial immigrants will drive more business innovation, and for the politicians in the audience who need money, more tax revenue.
Crazy? Sure. But allowing our country to have economic growth of 10% per year and fixing the housing crisis because we open the floodgates for immigration sure beats the current state of the economy. It would be crazier to think that the Federal Reserve could actually create prosperity, because in the end just like it's taught in Econ 101, economic growth consists of two and only two components: productivity increases and population growth.
Do we want to be the next Japan and have two lost decades? I don't.