What is the Chinese Exclusion Act?

Liam Heffernan: 00:00:01

In: 1882

And how did this shape American economy and culture? In this episode, I want to know what exactly is the Chinese Exclusion Act? Welcome to America, a history podcast.

I'm Niam Heffernan and every week we answer a different question to understand the people, the places and the events that make the USA a what it is today.

To discuss this, I am joined by an assistant professor of Business Administration at Harvard Business School and a co author of the Impact of the Chinese Exclusion act on the Economic Development of the Western US a paper which was featured in the New York Times, Bloomberg, NPR, and loads of other places. And I'll link it into the show notes as well. For any of you listening who want to read that, a big welcome to Professor Marco Tabellini.

Marco Tabellini: 00:01:27

Hi, thank you very much for having me.

Liam Heffernan: 00:01:29

It's a real pleasure having you on the podcast.

And as I was saying before I hit record, we sort of touched on this before in a previous episode and it felt like a big deal that we needed to give a bit more time to. So I'm really glad that we could do this.

So to kick us off, I'm just hoping you can give me a little bit of background on the kind of the key dates from the act and how this all came into play.

Marco Tabellini: 00:01:55

ct was formally introduced in: 1882

hen repeatedly rolled over in: 1892

entries were allowed, but in: 1884

In practice, this was, if this happened, was a very rare instance.

Both because it was hard to prove the level of skill and because many Chinese immigrants themselves, the high skilled, decided not to try to enter anyway.

Liam Heffernan: 00:02:58

So what was the actual kind of legal criteria then as to who this ban applied to?

Marco Tabellini: 00:03:05

So it was basically, this is the, I think from a historical standpoint, it's one of the peculiar, interesting aspects of the act. This was the first time in US history that a ban was placed on a group of people based on their race or ethnicity.

known immigration acts of the: 1920

Liam Heffernan: 00:03:54

So had there been any that, you know, of any sort of precedents that had been set elsewhere in the world with this kind of legislation?

Marco Tabellini: 00:04:04

So for sure, in American history, this was the first time, I believe, in Canada, a version of the Chinese Exclusion act was passed a few years afterwards. And so this is in many respects the first race or ethnicity based exclusion act for the United States.

Liam Heffernan: 00:04:26

How exactly is a law like this enforced?

And I asked this question in the context of today's landscape in the US where you see what Trump's doing with ICE and, you know, these sort of mass deportations.

It seems to me that actually it's a lot easier to be over strict on the management of this law than it is to actually govern it accurately, if that makes sense.

Marco Tabellini: 00:04:55

It makes total sense, I think relative to 100 years ago or 140 years ago when the act was passed. The technology, of course, has changed a lot today.

So back in the days, what happened was that Chinese immigrants typically arrived to the United States through the port of San Francisco. And so it was relatively easy logistically to have controls on all the ships that would arrive there.

And it's well known that typically immigrants, immigrants from China were temporary laborers who would leave their family behind and would come to the United States to work, earn wages, that they were largely sent back as remittances. So it was, logistically, it was not so hard to control the flows.

Initially there was this attempt whereby Chinese immigrants would go to Canada and then try to cross the border from the north. But it was not widespread.

I must say there is a little bit of, in the historical, not in the economic but in the historical literature, I think there is some debate around the stringency of the act, in particular on the ability of the US Government to fully curtail entries.

If you look at the census records, so not immigration records, you do see a drastic slowdown first and then actually a reduction action, the number of Chinese people or people with Chinese ancestors, suggesting that indeed it was enforced fairly well.

But if I have to kind of fast forward to today, it was a very different world where you had a couple of entry points and it was relatively complicated to get to the United States. The US could monitor relatively well what was Happening today. If we think of immigration more broadly to the United States, it's more complicated.

Liam Heffernan: 00:07:01

Yeah, of course. And it was perhaps a slightly unfair comparison because of the, you know, how different the world is back then.

But I do wonder, I mean, you said that Canada brought in a similar act a few years later. Was that a direct result of the fact that Chinese immigrants were trying to sneak in through the Canadian border?

Marco Tabellini: 00:07:23

I don't think so.

I think it was basically both in the US and in Canada there were anti immigrant sentiments and for a number of reasons, I think they erupted, or let's put it this way, they arrived, they culminated with a legislation in the United States earlier than in Canada, in part. It may also be that the legislation in the United States provided with legislators in Canada with an example to follow, if you will.

So I don't think there was at least, again, it's hard to know because the historical records are somewhat limited.

But you don't the perception, and I think the agreement among historians is that there was no major rerouting of immigration from the US to like Chinese immigration from the US to Canada.

Liam Heffernan: 00:08:19

I think that's, I mean, you mentioned the kind of anti immigration sentiment at the time that drove this. But I guess what I'm really curious to find out is where did that anti immigration sentiment come from?

You know, was it the government responding to the people or was it the government having other perhaps more broad political or military fears or something?

Marco Tabellini: 00:08:46

Yeah, so typically when you think of anti immigrant sentiments, and I think this applies both historically and today, there are two big sets of explanations.

One is economic concerns in the form of immigrants taking jobs from natives, increasing labor market competition, reducing wages and so on and so forth.

The second is more what economists and political economists refer to cultural opposition to immigrants, which is associated with the fear, uncertainty and anxiety about the inflow of foreigners who have different cultures, traditions, religion, languages and look different. The Chinese Exclusion act, if you look at the motivations behind it, was a combination of the two.

So there was the complaint among white workers, both those born in the United States and those born in Europe who were working in the United States. The Chinese immigrants were undercutting the wages of the white individuals. Labor unions were relatively vocal.

There weren't that many unions at the time, but those that were there were opposed to the Chinese, to the Chinese workers, I think a big component was also xenophobia and so concerns about individuals who looked different than the white American born person. The political output, namely the act, was a combination, reflected a bit of both.

And so the legislators, both parties, were strongly supportive of the Chinese Exclusion act. And I think it was a combination of the two.

My personal reading of the Chinese Exclusion act and the anti immigration sentiments more broadly is that they are more often motivated by cultural concerns than by economic ones.

This is not to say that the economic ones are unimportant, of course, but it's to say that I think especially for the Chinese immigrants, the cultural diversity, the perceived diversity of a group that did not share language and other traditions with the US born people was very important.

Liam Heffernan: 00:11:14

There's an irony to that, isn't there? Because actually the only people that are indigenous to the US are Native Americans.

And when European immigrants came to America, they didn't think too much about stamping out that culture to kind of in the name of the frontier. So what do you think?

That, that these kind of second, third, fourth generation immigrants maybe just felt threatened, that actually there was a wave of Chinese immigrants and perhaps the status quo that they'd built was suddenly being compromised?

Marco Tabellini: 00:11:45

Totally, yeah.

And anecdotally you see recurrent waves of this type of dynamics in American history and elsewhere that recently arrived immigrants, or say the second generation, third generation, are often those most strongly against the new immigrants because they're perceived, the new immigrants as a threat, a threat economically because they may be more likely to get substituted by the new immigrants. But also status competition, right?

So when societies are heterogeneous, there are different groups and the group that arrives last threatens in this hierarchy. The group arrived in the previous, say, decades. And so definitely there was some of that.

And the Chinese workers were often employed in railroads and they would work side by side with say, Italian, Irish and other immigrants. And there was clearly competition between these different groups.

The Chinese workers were known for completing work very efficiently, for indeed low wages, wages below what the Italians, the Irish and other immigrants would receive. And so there was this perception not everyone was against the act, sorry, not against Chinese immigration.

And in fact there was also opposition to the Chinese Exclusion Act. The employers, the railroad managers were really worried about the effects that Chinese exclusion would have had on the economy.

But eventually the support for the act prevailed and Congress almost unanimously passed the measure.

Liam Heffernan: 00:13:47

It makes me think though that when you consider certain economic concerns, we take wages, for example, instead of just banning a whole ethnicity of people who were willing to work for lesser wages, surely the right approach would have been to just introduce minimum wage flaws or other measures that meant that actually all employees, regardless of background and ethnicity, were treated equally.

Marco Tabellini: 00:14:19

Yeah, that for sure. That is a big question of what if you have this concern, what is the right solution?

And I think one may even argue that immigration restrictions sometimes can be designed to protect the immigrants themselves if the immigrants are exploited.

I don't think at all that this was what was going on at the time the Chinese Exclusion act was introduced because people didn't want to have Chinese immigrants. I think especially in the United States, because of the individualistic culture.

The idea of a minimum wage, we know that has now has made some inroads, but it's not something very easy to introduce either. Right. And it's interesting because the employers may actually prefer not to introduce it.

But I agree, this restriction, like complete ban on Chinese immigration, I mean, I guess we'll get to this later, but was not a good idea economically. And this is not specific to the Chinese Exclusion Act.

There are other studies that have shown that banning this very widespread and massive immigration restrictions don't actually pay off economically, not even for the workers they are supposed to protect, namely in this case, for example, the native born workers.

But I think there is a political economy issue when you try to introduce some of these more efficient measures that makes it very hard to achieve these goals.

Liam Heffernan: 00:15:59

But before we dive into sort of the impact of the Chinese Exclusion Act, I'm keen to understand the reaction, especially the public reaction to it at the time, because clearly there was a lot of anti immigration and anti Chinese sentiment across America. But was the government at the time popular for bringing this in and was there any immediate backlash?

Marco Tabellini: 00:16:22

I think there was resistance from the managers of the railroads and the employers, but by and large this was considered a very popular measure. There was, to the best of my knowledge, little backlash. And it's ironic because it was not economically beneficial.

But my sense is that there was so much widespread support for the Chinese Exclusion act because the Chinese immigrants were perceived as being very, very different from American culture. And thus, if we think of a hierarchy of groups in the society, they were really at the bottom.

And so there was basically no interest in the society in protecting a group that was perceived to be at the very bottom of the society.

Liam Heffernan: 00:17:18

I realize I'm going to ask my next question, knowing that you've co authored a whole book on this. But in a nutshell, why was the Chinese Exclusion act so bad economically?

Marco Tabellini: 00:17:30

I think it was bad because it acted as a drastic supply shock, negative supply shock to local economies.

So the Chinese immigrants were a relatively small group among all immigrants in the entire United States, but they were a sizeable part of the US west in some areas accounted for up to 20% of the labor force.

And so from an economic standpoint, the, the moment you ban 15, 20% of the labor force working in your area, then employers have to find these new workers. And it's not immediate to find them.

Let me add one important point, which is the Exclusion act of the Chinese did not entail deportations or repatriations as was instead done for other groups later. But effectively it encouraged it. And the reason is that sex ratios were highly skewed.

96% of the Chinese immigrants in the United States States were men. This meant that they had their family at home in China.

And because re entry was also banned, Chinese immigrants had to choose shall I stay without my family? In an environment in which lynchings happened, discrimination was very widespread. Chinese immigrants were not allowed to become citizens.

They were not allowed to own property, for example, in some parts of the United States, so many left. And so the short answer to your question is this was a major supply shock, negative.

And employers could not immediately replace the Chinese immigrants who left either through other immigrants, either through other workers or through technologies.

So the assumption we often make or the people who support these immigration restrictions often make is that the economy would quickly adjust through say the replacement of the excluded group with the native born workers. But there may not be enough native born workers.

And this was especially true in the US west, which was growing in population, was growing economically and was still relatively remote from the eastern part of the United States. And so it was not immediate to bring workers to where they were needed.

And basically it was in the language of economists, the US counties where the Chinese immigrants were concentrated had a comparative advantage in production which was based on the endowment these Chinese immigrants who were there. And all of a sudden the act removed this comparative advantage. And so the economic attractiveness of different areas changed dramatically.

Firms started to close or to move to other places.

Liam Heffernan: 00:20:25

Yeah, and just to sort of add to that really with a, I guess a present day example from the uk because in today's world in Britain there is an anti immigration sentiment towards certain Eastern European communities and a similar sort of feeling that we've been touching on in this episode, that Eastern Europeans might come over to the UK and they might come solo, they will find a job and the money gets sent back to their family. So they, not only are people working for less than other British citizens would work for, but the money's then going out of the country.

Now back then that was obviously you couldn't just send the money back to China to their families. So I really don't understand what the downside here is.

You've got someone who has sailed over to the US They've found themselves a job, fine, they're doing it for less money than someone else, but they're doing a job, they're earning that money and then they're trying to build a life for themselves in the US And I'm going to make the assumption that the long term goal would have been to move their family over to the US to join them. So how is that bad?

Marco Tabellini: 00:21:37

I think you're touching on so two reactions. One is at the time it was actually there was actually pretty sophisticated system to send remittances back to China.

So there was very little consumption in the United States of Chinese immigrants. But it's true, I assume that many of these Chinese immigrants may have had the hope to establish families and communities in the United States.

And this brings me to the second reaction to your comment, which is systematically there is a tension I feel like when we think about immigration. On the one hand, it seems to me that there is widespread opposition to temporary workers who who come may exert competition and don't settle.

At the same time I have also the feeling that people don't like when immigrants move to a country for good because the native born population doesn't necessarily like the idea of say sharing public schools, sharing hospitals and so on and so forth with foreigners. So there is a tension there which you mentioned the Eastern European immigrants in the UK I think there's a very strong similarity.

And the other thing that sometimes the anti immigrant supporters don't realize that the fact that there are immigrants who perform jobs for low wages often allows native born workers to move up along the quality ladder of jobs. And so this is in fact what happened with the Chinese immigrants.

They were typically employed in the worst jobs with least job security, high risks, including death. They would perform these jobs and would allow other workers to perform better paid jobs jobs.

This is not to say and I think in this hyper polarized environment I want to clarify this.

It's not to say that all immigration restrictions are necessarily bad and that thinking that the Chinese Exclusion act was a huge economic mistake as I do think this doesn't imply that. I also think that no restrictions at all at any point in time should be introduced.

a country. The US west in the: 1880

There was very strong labor demand to the point that employers were trying to recruit Workers both from the east and from the West. And when one of the main sources of labor was cut off, it was not so easy to immediately bring other workers back in.

And establishments and firms had to basically grow much less quickly, which also meant fewer job opportunities for native born workers. Of course, in a context of stagnating economy with high unemployment rates, things may be different.

So you can think of immigration restrictions and immigration policy as an active labor market policy to protect the navy born workers. But there are between the full restriction and the full open borders, of course there's a big, big distance.

Liam Heffernan: 00:25:19

And just to clarify actually what you've been discussing, Chinese immigrants who were living and working in the US when the Chinese Exclusion act was brought into law, did that mean that overnight they were no longer allowed to work?

Marco Tabellini: 00:25:40

left the country. So between: 1882

But after: 1884

So the Chinese Exclusion act was followed, it was also anticipated by lynchings, episodes of violence, discrimination, legal and so formal and informal, against the Chinese. So there was an atmosphere whereby it was clear that Chinese immigrants were not safe, which also increased incentives for people to leave.

Liam Heffernan: 00:26:28

And I guess that's the problem, right.

Is that this, when you think socially, the Chinese Exclusion act was this sort of way of systemizing and allowing discrimination and it opens the door for people that do want to lynch and be violent and more outwardly hostile towards the Chinese. Right?

Marco Tabellini: 00:26:52

That's exactly right. Also because in this case it was not a neutral immigration restriction like based on like some economic based criterion. It was a criti.

The criterion was that the Chinese immigrants were a threat to American values, whatever that meant. But it sent a signal that institutions were actually supporting discrimination, were openly encouraging it.

So that's I think a very important consideration and downsides of these sorts of policies that can feed social conflict and violence.

Liam Heffernan: 00:27:32

And when we look at the I guess the often sort of turbulent relationship between the US and China, how much do you think that has been affected by these early kind of dynamics established through the Chinese Exclusion Act?

Marco Tabellini: 00:27:51

So my sense is that though there is typically long term persistence, my feeling is that the Chinese Exclusion act, at least from the US perspective has not had a strong influence on the relation with China. I think it was probably part of a strained relation to begin with.

It's hard to say whether it directly left kind of effects, of course, for the local communities that were and the individual people who were affected by this, I'm sure it had very tangible consequences for the. For the international relations. I'm less sure about it instead.

Liam Heffernan: 00:28:37

And so I guess, finally and hypothetically, how different do you think America would be, particularly demographically, if the Chinese Exclusion act hadn't been enforced?

Marco Tabellini: 00:28:52

Yeah.

So, of course it's always hard to answer this question, although I think these are among the most important questions you ask when you try to do studies like the one that we did. And I think it would look different. Our results indicate that the Chinese Exclusion act slowed down economic growth in the US West.

It led to lower growth of the manufacturing sector, which at the time was the engine of growth. It slowed down urbanization rate. It slowed down the transition away from agriculture and towards manufacturing.

ffects, we can see them until: 1940

We don't measure the effects of the act past that date because it gets very complicated, of course. But my personal take is that it did have an effect on the speed of growth.

y populated, at least through: 1940

Liam Heffernan: 00:30:08

Yeah, that's interesting.

And I think there's a whole lot more to unpack off the back of this, but I think getting that sort of base understanding of what the Chinese Exclusion act was and how it impacted the US has been incredibly helpful.

So, Marco, thank you so much for joining me for this and to anyone listening, if you want to find out more about what we've discussed, I'll put some useful links in the show notes, so check out all of those. But Marco, if anyone wants to connect with you directly after this, where can they do that?

Marco Tabellini: 00:30:41

Thank you very much for having me. They can go on my website through hbs and there they can find all the relevant information and of course, they'd be happy to be in touch.

Liam Heffernan: 00:30:52

Wonderful. Yeah. And I'll put a link to that as well in the show Notes for People, and you can find me on social media.

I won't bore you with the info, but just search for my name and I'll pop up.

And if you enjoy the podcast, please do leave us a rating and a review wherever you're listening to this and give us a follow as well so that all future episodes appear in your feed.

And also, if you really like what we do, there are some links in the show notes to support the show from as little as $1, which helps us keep making the show but also makes everyone involved really happy. So thank you so much for listening and goodbye.

Marco Tabellini: 00:31:31

Sa.