What is an export? What is an import? These words are defined in reference to political boundaries of only one kind: national boundaries. If there were no such boundaries, there would be no exports or imports. But political boundaries are just that. They are not economic boundaries. To the extent that they can, people go about their business as though those boundaries weren’t there. People cross the Canadian-American and Mexican-American borders to transact business every day. If they give them a thought it is only because governments put up barriers patrolled my armed guards who make them wait in line. People learn early in life that they can gain immensely from trade, and with that understanding comes the insight that it doesn’t much matter on which side of a Rand-McNally line your trading partner lives.
From http://www.thefreemanonline.org/columns/tgif/made-everywhere/
The whole article is worth a read.
There is at least a half truth in legitimate fear of immigration. In both counties had identical policy then you would probably be right. However, America is plentiful when it comes to wepfare programs. I am all for open borders, don't get me wrong, but the fear of the conservative is that this immigrant will come, earn all their money under the table (also a good thing) then apply for welfare checks. And why wouldn't they? Now, even if they did I would make the case that on the whole, it would still be beneficial to have them here.
Its like the whole drug debate. "if we legalize all the drugs then people will get addicted, live on the public roads and I will have to pay to put them through rehab." these are half-way legitimate points. The solution however is not to conclude that drug laws work but rather that roads should be privatized and welfare programs be repealed. And just as with immigration, even if you did not repeal these and did not privatize the roads, we would still be better off, and I think Portugal and the Netherlands have pretty well proven this.
So, in fairness, it's not quite as simple as this border only means something because governments sit at them to form lines, but the issue is still vastly misunderstood.
"If men are not angels, then who shall run the state?"