Question

7. The American Federation of Labor (AFL) is a collection of labour unions that was formed in 1886 to protect the interests of unionized workers. In the 19th Century, the AFL opposed immigration. From an economic perspective, why?

(A) Immigrants do not bring shared cultural values.
(B) Immigrants overwhelmingly vote Republican.
(C) Immigrants can harm the productivity of AFL workers.
(D) Immigrants compete for jobs with AFL workers, causing wages to drop.

Answer 1

The correct answer is D-Immigrants compete for jobs with AFL workers, causing wages to drop.

While Nativism (that is, promoting the interests of native workers over immigrants) was indeed an issue for AFL, it became a major issue for them in early 20th century (leading to passing of Immigration Act of 1924) but in the 19th century, as the question asks, it wasnt that big an issue for them. In fact, about half of their labor force consisted of Irish, German etc immigrants).

In the 19th century and from an economic point of view, as the question asks, the main issue for them was that unrestricted immigration would increase the supply of labor and will result in reduction of wages. This was a simple supply demand issue. On a supply demand graph, this would've pushed the supply of labor to right while the demand would've remained same, resulting in a new equilibrium point with lower wage.