New York Mayor Rudolph Giuliani has been praised by liberals for his courage in opposing measures to deter the use of public services by illegal immigrants. The truth is that ignoring the rising costs of mass immigration, legal as well as illegal, is anything but courageous - or liberal.

While business-class and populist Republicans have engaged in serious debate about immigration, discussion of the subject by Democrats is still governed by taboos. The consensus liberal position rests on two articles of faith.

First, while illegal immigration may cost the jobs of low-skilled American workers, no legal immigrant has ever displaced an American worker. Second, any suggestion that the arrival of almost a million legal immigrants a year has any effect on job opportunities and wages in the United States is said to be sinister racist 'scapegoating.'

Though this viewpoint is appealing, the harmful effects of legal as well as illegal immigration on low-income American workers are real. The Federal Reserve Bank of Dallas has attributed 'heavy immigration to border cities' as the reason for unusually high unemployment in cities like Laredo, El Paso and McAllen. The economist George Borjas has calculated that immigration accounted for a third of the decline in the wages of high school dropouts in the 1980s; a major cause is the willingness of foreign workers to accept lower wages.

While the economists debate the magnitude of the displacement of native labor by immigrants, the white and black working poor have been fleeing the metropolitan areas of California and other states where the economic competition with Latin American and Asian newcomers is the most intense.

The downward drag on wages caused by immigration is likely to grow worse. The economy cannot expand rapidly enough to provide decent jobs for the bottom half of the native population, much less for hundreds of thousands of legal immigrants arriving each year. Figures from the Census Bureau and the Bureau of Labor Statistics show that the number of new entrants to the work force will outstrip the number of jobs created by more than a million and a half between 1995 and 2005.

From the point of view of business-class conservatives, the labor supply can never be too large, and wages never too low. It is no coincidence that spokesmen for the plutocratic wing of conservatism, like Dick Armey, the House majority leader, and the editorialists of The Wall Street Journal, favor even higher levels of immigration and the abolition of the minimum wage.

Unable to win on the facts, all too many pro-immigration liberals resort to nostalgia. With misty eyes and trembling voice, they invoke the Statue of Liberty and accuse critics of treason not only to American ideals but to the memories of immigrant ancestors. This may be good politics for politicians like Mayor Giuliani, but it is bad history.

The movement to curtail immigration in the early 20th century was opposed by business leaders enjoying access to cheap labor, but was supported by many labor leaders. Samuel Gompers, the American Federation of Labor president, argued that the flood of European immigrants was depressing wages.

He was right. From 1890 to 1920, American wages rose from 2 to 4 percent less than they would have in the absence of immigration, according to the Harvard economist Claudia Goldin.

The many ethnic divisions among native and immigrant workers at the time explain the weakness of the American labor and social democratic movements, compared with those in Western Europe's low-immigration democracies. And cynical employers who pursued a divide-and-rule policy of 'balancing the nationalities' exploited these divisions.

The restriction of immigration in the 1920s, by encouraging a tight labor market and a culturally unified work force, was a precondition for the successes of the labor movement and New Deal liberalism from the 1930s to the 1960s.

The liberal taboo against realistic discussion of immigration extends to a refusal to acknowledge its effects on poor blacks. In the 19th century, as Frederick Douglass and Booker T. Washington noted, European immigrants displaced black workers from jobs as longshoremen, artisans, barbers and caterers. Closing the borders in the 1920s opened up job opportunities for blacks in the North laying the basis for economic gains and the civil rights movement.

Since 1965, however, the black working poor have suffered again from competition, this time with Latin Americans and Asians. There can be little doubt that many employers discriminate against African-American workers and in favor of immigrants, who are more likely to accept low wages and poor conditions without complaint.

Many immigrant groups, once they have moved into professions like taxi service or the grocery business, set up nepotistic networks in hiring and finance from which long-resident urban blacks are frozen out.

'A few courageous liberals ...

have dared to bring up

the relationship between

mass immigration

and falling wages.'

Why have liberals been silent about the economic effects of immigration on their natural constituency - the working poor, and black workers in particular? One reason is the inability of liberals to say no to any apparently generous program, particularly if it aims to help those in poor countries. Another is the influence of Hispanic groups seeking to enlarge their consti-tuencies. Many affluent opinion-makers in politics, the media and academia themselves benefit from a never-ending supply of low-wage immigrant maids, janitors, receptionists and other poorly paid, non-unionized employees. A few courageous liberals like former Represen-tative Barbara Jordan of Texas have dared to bring up the relationship between mass immigration and falling wages. Ms. Jordan, chairman of the bipartisan Federal Commission on Immigration Reform, called for limiting family-reunification immigration to nuclear families, eliminating the annual allotment of 10,000 visas to unskilled foreign workers, deterring illegal immigration by means of a national identity card, and capping legal immigration at 550,000 a year (down from almost 800,000 a year in 1994).

These sensible reforms do not go far enough. We should also follow most other democracies in making it difficult for employers to hire non-citizens if qualified citizens are available. When many college graduates cannot find good jobs, why are we issuing so many work permits for foreign workers (more than 600,000 last year)? Why should a company be allowed to replace American computer programmers with Indian guest workers in the United States?

The United States can no longer be the world's employment agency and welfare service of first resort. A genuine liberal policy toward immigration would reduce the supply of surplus labor by reducing the supply of immigrants. A tight labor market is the best program for restarting America's stalled engine of upward mobility.

The liberal case for reform is based on numbers - on the quantity of immigrants, not their quality. Under a rational plan, most immigrants would still come from Latin America and Asia; they would simply arrive in smaller contingents. Unlike conservatives, liberals should insist that legal immigrants, while waiting to be naturalized, should have access to the basic civil rights and entitlements of American citizens.

For 30 years, we have had an immigration policy tailored to the convenience of the American overclass. Pro-labor liberals and non-racist populists on the right should unite to demand an immigration policy that puts the interests of American workers above the interests of the native rich. ;