The recent fanfare over the "illegal" hiring practices of attorney general candidates Zoe Baird and Kimba Wood strikes a sore point for American workers concerned with maintaining jobs and working conditions. Long after the talk-show hosts exhaust their audiences with xenophobes who blame "illegals" for the failure of the American economy and deterioration of "American culture," the issue of the underground economy--the cash transaction economy that both legal and undocumented workers participate in--will remain. On Thursday in Sacramento, Assemblyman Richard Polanco (D-Los Angeles) will open hearings on "Immigrants, Immigration and the California Economy," in which legislators will address the impact of this underground economy.

The market for domestic services and child care is but a small segment of a labor market so interwoven into the fabric of Southern California that its tapestry blankets the masses. Despite the economic significance of these workers, during recessionary times the workers become the lightning rod for public discourse about the inequities of our market system. But markets, including labor markets, do not respond to frustrated malcontents. Rather, they respond to incentives that induce transactions to occur. In a global economy in which wage differentials are so great, people will immigrate. Immigration from Mexico to the United States, or from Romania to Poland or the Philippines to Canada is inevitable.

Unfortunately, immigration law has not caught up with this dynamic flow. Unlike the glamorous North American Free Trade Agreement that attempts to enhance the competitiveness of Canadian, Mexican and U.S. firms in global markets, the 1986 U.S. immigration law attempts, albeit unsuccessfully, to curtail the international flow of labor. With the ratification of NAFTA, Americans will soon accept the migratory flow of capital. Is it not time that we begin to explore these same possibilities for labor?

Agriculture, a critical sector of the California economy, has for decades acknowledged the need for available and low-wage labor to maintain its competitive position in the domestic and global economy. In every round of immigration reform, agricultural interests have codified their labor market needs through various guest-worker programs.