The Economics of Undocumented Labor, Scott’s Plans for SXSW, and Should Parents Leave the U.S.?

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1:22Scott Galloway:Welcome to Office Hours with Prof G. This is the part of the show where we answer your questions about business, big tech, entrepreneurship, and whatever else is on your mind. If you'd like to submit a question for next time, you can send a voice recording to officehoursofprofitandmedia.com. Again, that's officehoursofprofitandmedia.com. Or post your question on the Scott Galloway subreddit, and we just might feature it in our next episode. First question. Our first question comes from Nicole Blevins on Instagram. They say, why isn't Trump targeting companies and CEOs that profit off of the undocumented?

1:53Scott Galloway:Well, because we don't want to go after those nice white people. Yeah, it's a fair question. And if you were serious about immigration, it'd be pretty easy. You'd put in place some sort of, what do they call it, biometric screening. And it's pretty easy. You show up to a Chipotle and if more than – for every person there that's not a documented worker, we fine you$1 ,000 a day and we do random audits and we fine the corporation. We fine the construction. We fine the contractor. We fine the fast food establishment. There's something like supposedly 24 percent of people working in fast food now are undocumented workers.

2:29Scott Galloway:If you started fining McDonald's a million dollars a day until it went down to 1 percent, they would figure it out. And by the way, these people would self-deport. They're not here. are, they're not here to go to Denver Broncos games or to go to In-N-Out Burger. They're here to make money. If they can't make money or find jobs, they will meld back and self-deport. But no, we'd rather terrorize them, demonize them instead of going after the people. It's a demand problem, not a supply problem in the sense that if the demand goes away, they'll go away. They'll self-deport. So your question is the correct one.

3:04Scott Galloway:Unauthorized immigrants made up about 6 % of the U.S. workforce in 2023, a record share, and that share is higher than their share of the total population. According to Pew, construction is 15 % of the workforce for unauthorized immigrants. As someone who's constantly renovating houses, I can tell you no domestically born professional is willing to work outside. Plumbers and electricians are the last place that you find natural-born U.S. citizens. Try and find a natural-born U.S. citizen who for 30 or 40 bucks an hour will get on a roof in the Florida sun and start roofing or do landscaping or, you know, swing a hammer.

3:43Scott Galloway:They just won't do it. So this notion that, oh, we need to bring back, we need less competition for our good workers to raise wages, bullshit. They don't want to do, domestic workers just don't want to do this work. Leisure and hospitality, 8%. Agriculture, 14%. man? Yeah, graduate from Carnegie Mellon and go pick fucking grapes or get a junior college degree or drop out of high school and see how many people actually want to go pick lettuce. Thank God. And by the way, who's going to wipe grandma's ass? Have you noticed how many foreign-born nationalists from Jamaica and the Philippines who have this wonderful, more empathetic, kind of caring, gentle culture, make for fantastic home health aides with all of these old people everywhere?

4:20Scott Galloway:Who's going to do that? Do you know how much it costs? I was with someone who's a senior executive of Reddit, and she was telling me they're interviewing her and her wife are interviewing for a nanny, a full-time nanny. Her wife's a baller, too. The cost for a domestic, papered, legal, whatever you want to call it, domestic nanny in Manhattan,$150 ,000 a year. $150 ,000 a year. A 2018 study by the Migration Policy Institute estimates that 13 % of child care workers are undocumented and almost a third of home health care workers are immigrants. In agriculture, undocumented workers make up a particularly large share of certain farm jobs.

5:04Scott Galloway:Estimates suggest they account for about 40 to 50 % of hired crop workers, half. Researchers have estimated that all immigrants, legal and undocumented, contribute about$3.3 trillion to the U.S. economy annually. That's as much as 17 % of our GDP. undocumented immigrants pay about$100 billion a year in payroll, property, and sales taxes. They are paying into Social Security, and most of them will never see a dime of it. So let's be clear. They commit crimes at a lower rate, and they tax their social services at a lower rate, yet they pay taxes. And that is why we have ignored illegal immigration.

5:37Scott Galloway:We didn't wake up one day and say, oh, no, there's 30 million undocumented workers here. From W to Herbert Walker to Clinton to Obama, we have turned a blind eye to this because the reality is, while immigration is the secret sauce of America, illegal immigration is the most profitable segment of immigration. Do some bad people come over and commit crimes? Yes. Should we not have open borders and have some sort of nation that includes borders and illegal immigration policy that honors the people who wait in line and spend seven or nine years to get in here legally? Absolutely. But the reality is, if you look at the incentives to ignore it, they've been huge because this is the most profitable, flexible workforce in history.

6:18Scott Galloway:They paid$47 billion in federal taxes,$29 billion in state and local taxes,$23 billion into Social Security, and$6 billion into Medicare contributions. All this bullshit about them coming over to take our Medicare subsidies and that the reason we're cutting Obamacare and Affordable Care Act subsidies to so many illegal immigrants who are taking advantage of these policies is bullshit. that they're contributing$6 billion into Medicare. So what needs to happen? You have to have borders. And I think Trump has done a good job on the southern border. And it is embarrassing the vice president was in charge of the southern border and did such a ridiculously fucking bad job when in one month people can raise their right hand 250 ,000 times and say asylum and they're led into the country.

7:02Scott Galloway:That made no sense either. David Frum summarized it perfectly. If progressives won't enforce the border, fascists will. We're now in the fascist part of the program. We need borders. And the way you fix this immigration problem is two things. One, you expand legal immigration. We have a pretty good idea what would be good for the construction, the agriculture and the home health care industries in terms of what we need in terms of qualified immigrants willing to come in and take care of your grandmother for$19 an hour versus$40 if you could even find a domestic worker to do it. We understand the numbers and we could have allocations.

7:43Scott Galloway:And then we go to every employer with biometrics and say, I'm here with a clipboard and everybody has to stare into this goggle. And if it comes up, they're illegal and not documented. We're going to start finding you a thousand bucks a day. Oh, and by the way, we're going to make it easier for you to hire documented workers who can play a critical part in our economy. We need to substantially widen the throttle for legal immigration, but also enforce our borders with biometrics and go after the demand side, go after the employers. But no, Republicans don't want to do that because business owners are our new heroes.

8:22Scott Galloway:That is absolutely the way we should go about having a more ethical, economically sane, logistically doable, non-terror anxiety inducing immigration policy. Question number two comes from Prox Texas on Reddit. They say, what are you planning for South by Southwest? The great state of Texas loves a dog. We love it down there. First off, I love the pale blue dot. I actually love Texas. I was on the board of a company called Dex, which became Thrive, which their headquarters was right next to the DFW airport, which made it convenient. But I enjoy Dallas. By the way, Dallas has this incredible infrastructure of services for kids with disabilities.

9:06Scott Galloway:How nice is that? Houston, I've never been a huge fan of Houston, but people like it. It always struck me as a city that shouldn't be there. Most cities, it's like two rivers meeting or it's in the middle of the valley. I've never understood why Houston is there, but it's one of the fastest growing cities in the nation. I think it just became the third or fourth year. And I love Austin. Oh my God. Tex-Mex, the digital world, all my podcast friends. And I love South by Southwest. I just think it's fantastic stay at the proper hotel roll down for a drink everyone's like Prop G everyone loves me there everyone loves me there everyone's nice to me so I love South by Southwest we'll do a couple live podcasts I think I'm doing a live pivot I think we're doing a live Prop G Markets with Ed Elson I'll do a bunch of dinners for advertisers so Vox can continue to whore me out like the bitch I am so yeah I got a bunch of stuff planned I'll be on a bunch of panels and a bunch of live podcasts, but please come up and say hi.

10:03Scott Galloway:I love meeting people there. And I think there's only two things I go to without getting paid. I usually get paid to do shit like this. South by Southwest and CanLions. Actually, I get paid. When people hear I'm going to CanLions, they're like, hey, come by the Salesforce tent. Well, I'm like, well, you're Salesforce. You got to pay me. Or Nestle. As excited as I am to talk about packaged CPG goods, you're going to need to pay me. But those are essentially the only two things I go to or would go to without compensation because I think they're just so much fun. And South by Southwest, well, they're different.

10:35Scott Galloway:South by Southwest is young people and cowboy boots who are like, I don't know, managing the social account for Bottega Veneta and Cannes Lions is the media planner who's about to be put out of work but is holding on at IPG and convinced his or her boss that, okay, instead of giving me a raise, let me go to Cannes Lions for the week. it's a little cynical it's a little cynical oh wait some other things I have planned I'll be co-hosting a 50 person section lunch on Sunday with Greg Shove the CEO of Section AI and we're bringing our full Prop G Media production team of 16 I did not approve that I did not approve that but anyways I guess they'll be there so we're planning team dinners on Saturday and Sunday I show up for drinks and then as soon as the young people start to get fucked up I leave so they can start making out or throwing shit or trashing the place.

11:25Scott Galloway:And no one needs to see the dog drunk. No one needs to see that side of me. They all think I'm so interesting and smart. I'm not. I'm none of those things. Anyways, they don't need to see that. And then we'll be at the Vox party hosted by Jim Bancroft on Sunday. Limited to the pod host. You know, I get to go for some kind of a big deal and I'm making them a shit ton of money. I'm definitely putting Bancroft's kids through college right now. Anyways, they seem like nice kids though. We'll be right back after a quick break.

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15:22Scott Galloway:welcome back onto our final question from jojo ts on instagram is there a point when the responsible thing to do as a parent is to leave the country hmm uh so i did leave the country but i want to be clear i didn't leave because of america people will say oh you're in london that's because america is so bad right no i left i came to england because america provided me with such incredible prosperity that I had the opportunity to go experience something different. And the plan was always be here for four years and then move back. And that's what I'm going to do in about six months. I also want to move back a little bit early because I'm so fucking freaked out about the U.S.

15:59Scott Galloway:I actually think the responsible thing to do right now, if you're an American living abroad, is to come home. I remember I was so moved. This happened to me a couple of times when the Russians invaded Ukraine and when October 7th happened in Gaza and Israel. I knew people, Ukrainians and Israelis, who the next day got on planes home. And that really moved me. And I don't like it. I can't, I don't know. When these actors threaten to leave America, I'm like, yeah, okay, don't let the flag hit you on the way out. I think it's the time to come home. So what was your question? Is it the responsible thing to do as a parent to leave the country?

16:37Scott Galloway:It's so situational. If you have family and a support system and economic opportunity in a great Western country like Germany or Spain or some cool place in Asia or Singapore, yeah, knock yourself out just for the experience. But just leaving America, as fucked up as America is, it's still a lot less fucked up than most places. Now, it's on the wrong trajectory and could soon pass or soon start to smell like a different name your favorite autocracy. but as far as we have fallen, things are still less bad here than most places. So I wouldn't suggest just deciding out of some sort of moral judgment, I need to leave and no, your kids, your kids want you in your life.

17:22Scott Galloway:They want a great school. They want support system. They want routine. I mean, your kids don't really care. Your kids want to be around supportive parents. They want access to good education. They want to have a cool friend group and they want their video games and their TikTok. That's about it. So the notion that you have some moral obligation to leave America, they don't know what's going on, or most of them don't know what's going on, unless their family's being terrorized by ICE, which is, I mean, it makes for, I'm not, I don't mean to in any way diminish it. It's terror or it's incredibly stressful if you're part of it.

17:52Scott Galloway:But the reality is the majority of Americans aren't being terrorized by ICE right now, which again, doesn't mean it's not a call to action and we shouldn't push back on it. But no, I don't, this is the kind of question you got to sit down with friends, but this general notion that you need to leave America for your children now, you know, it's gotten a lot worse here, but it's still less bad than most places. And also I would say to those of us who are abroad, I do think it's a time to return home.

18:19Scott Galloway:That's all for this episode. If you'd like to submit a question, please email a voice recording to officehoursofproptomedia.com. Again, Again, that's officehoursofproptamedia.com. Or if you prefer to ask on Reddit, just post your question on the Scott Galloway subreddit, and we just might feature it in an upcoming episode. This episode was produced by Jennifer Sanchez and Laura Janair. Cammie Reek is our social producer. Brad Williams is our video editor. And Drew Burrows is our technical director. Thank you for listening to the Prop G pod from Prop G Media.

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