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The Democratic Party Presidential Platform of 1996 – On Immigration

What follows is from Today’s Democratic Party: Meeting America’s Challenges, Protecting America’s Values, a.k.a., the 1996 Democratic Party Platform. This is the section on immigration.  I took the liberty of bolding pieces I found interesting.

Democrats remember that we are a nation of immigrants. We recognize the extraordinary contribution of immigrants to America throughout our history. We welcome legal immigrants to America. We support a legal immigration policy that is pro-family, pro-work, pro-responsibility, and pro-citizenship, and we deplore those who blame immigrants for economic and social problems.

We know that citizenship is the cornerstone of full participation in American life. We are proud that the President launched Citizenship USA to help eligible immigrants become United States citizens. The Immigration and Naturalization Service is streamlining procedures, cutting red tape, and using new technology to make it easier for legal immigrants to accept the responsibilities of citizenship and truly call America their home.

Today’s Democratic Party also believes we must remain a nation of laws. We cannot tolerate illegal immigration and we must stop it. For years before Bill Clinton became President, Washington talked tough but failed to act. In 1992, our borders might as well not have existed. The border was under-patrolled, and what patrols there were, were under-equipped. Drugs flowed freely. Illegal immigration was rampant. Criminal immigrants, deported after committing crimes in America, returned the very next day to commit crimes again.

President Clinton is making our border a place where the law is respected and drugs and illegal immigrants are turned away. We have increased the Border Patrol by over 40 percent; in El Paso, our Border Patrol agents are so close together they can see each other. Last year alone, the Clinton Administration removed thousands of illegal workers from jobs across the country. Just since January of 1995, we have arrested more than 1,700 criminal aliens and prosecuted them on federal felony charges because they returned to America after having been deported.

However, as we work to stop illegal immigration, we call on all Americans to avoid the temptation to use this issue to divide people from each other. We deplore those who use the need to stop illegal immigration as a pretext for discrimination. And we applaud the wisdom of Republicans like Mayor Giuliani and Senator Domenici who oppose the mean-spirited and short-sighted effort of Republicans in Congress to bar the children of illegal immigrants from schools — it is wrong, and forcing children onto the streets is an invitation for them to join gangs and turn to crime. Democrats want to protect American jobs by increasing criminal and civil sanctions against employers who hire illegal workers, but Republicans continue to favor inflammatory rhetoric over real action. We will continue to enforce labor standards to protect workers in vulnerable industries. We continue to firmly oppose welfare benefits for illegal immigrants. We believe family members who sponsor immigrants into this country should take financial responsibility for them, and be held legally responsible for supporting them.


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Ten Points on Immigration

I have written a number of posts, some using data and some not, on immigrstion. Some of those posts attracted vitriol in comments, including from some who keep accusing me of hiding my punchline. Personally I find myself repeating myself, or trying to restate a point yet a different way so it will sink in. I figured it is probably time to put everything in one place, so here it is:

1. Some cultures prepare their people to function well in the US, some don’t.

2. Ability to function well in the US is not the same thing as intelligence. As an example, consider me. I lived almost a third of my life in South America. I have never been to Central Asia. All else being equal, I can hit the ground running more easily in Argentina than in Iran. In Argentina I know how to behave in a seamless way that won’t raise eyebrows. In Iran, I would need to put effort into day to day activities. Additionally, my communication skills wouldn’t work as well. It isn’t just a matter of not speaking Farsi, but also being unable to unconsciously read and display the myriad of social signals Iranian society uses. Therefore, my productivity will be greater in Argentina than Iran (again, all things being equal). And yet my traits – the degree to which I am or am not intelligent, creative, diligent, sane, honest, etc. – will be the same whether I am in Buenos Aires or in Teheran. Most of my work related skills (less those involving communication) will also be the same in both places. The difference between my productivity in Argentina v Iran will be due entirely to differences in cultural compatibility.

3. Cultural compatibility runs the other way too. Arriving in the US doesn’t automatically confer respect for Western values. In many countries, anti-Christian or anti-Semitic attitudes are common. In the West people argue about gay marriage.  In some countries, the debate is whether gay people should be stoned or thrown off tall buildings. Similarly, the treatment of women and children in some countries would be criminal in the US. Think honor killings, child’s marriages, FGM or bacha bazi. (And yes, we are seeing those things happening here now.) Writing again from the role of someone who was a guest in other peoples’ countries for a third of his life, it should be the responsibility of the newcomer to adapt to his/her new home, and not of the residents of his/her new home to adapt to the newcomer.

4. In Western countries, immigrants who don’t manage to bridge cultural gaps are more likely to end up dependent on the taxpayer. Immigrants are disproportionate users of welfare. In general, it seems (at a minimum) to be bad form to request entry into another society only to become a burden on its people. It is one thing for refugees with no other option to do it, but most immigrants to the US are not refugees.

5. Being overwhelmingly reliant on government largesse in a foreign society built by strangers has got to be dispiriting to most thinking adults. It can only add to a person’s feeling of alienation. That in turn can lead to various dysfunctions – vices, crime, anti-social behavior and even terrorism. It is no surprise that some of these issues exist disproportionately in some immigrant communities.

6. Countries whose emigrants generally do well in the US also tend to be countries with Western values and strong economies. More precisely, countries whose immigrants do well in the West have economies which thrive from the skills of its people, and not countries whose economies is based mostly on raw material extraction directed by foreigners or on financial transfers from wealthier nations.

7. Countries whose emigrants generally have good outcomes (e.g., high incomes, low unemployment, low crime rates)  in the US also have good outcomes in other Western countries. Conversely, countries whose emigrants don’t generally have good outcomes in the US also generally don’t have good outcomes in other Western countries.

8. Within any society, there are some who are more able to function in the US and some who are less able to function in the US. To be blunt, some people have attitudes that allow them to function well in the West. Typically they are dissidents in non Western countries. Place of origin shouldn’t be enough to, by itself, weed out one potential immigrant or guarantee entry to another to another.

9. The fact that there are people in the US who do not have good outcomes (e.g., are in poverty, are criminals, etc.) is not a good argument for immigration of other people who also have do not have good outcomes.

10. There are far more people who would like to immigrate to the US than we allow into the US. Given that, it makes sense to be selective, both for our sake and the sake of those who are unlikely to function well and would become alienated and unable to fend for themselves in the US.

I note that none of these points are new. I have stated them all before, but not all in one place.

Update:  Minor edits to Point 7 and 9.

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The Electoral Consequences of Globalization

by Joseph Joyce

The Electoral Consequences of Globalization

The reasons for the election of Donald Trump as President of the U.S. will be analyzed and argued about for many years to come. Undoubtedly there are U.S.-specific factors that are relevant, such as racial divisions in voting patterns. But the election took place after the British vote to withdraw from the European Union and the rise to power of conservative politicians in continental Europe, so it is reasonable to ask whether globalization bears any responsibility.

The years before the global financial crisis were years of rapid economic globalization. Trade flows grew on average by 7% a year over the 1987-2007 period. Financial flows also expanded, particularly amongst the advanced economies. Global financial assets increased by 8% a year between 1990 and 2007. But all this activity was curtailed in 2008-09 when the global financial crisis pushed the world economy into a downturn. Are the subsequent rises in nationalist sentiment the product of these trends?

Trump seized upon some of the consequences of increased trade and investment to make the case that globalization was bad for the U.S. He had great success with his claim that international trade deals are responsible for a loss of jobs in the manufacturing sector. In addition, he blamed outward foreign direct investment (FDI) by U.S. firms that opened production facilities in foreign countries for moving manufacturing jobs outside the U.S. Among the firms that Trump criticized were Ford Motor, Nabisco and the Carrier Corporation, which is moving a manufacturing operation from Indiana to Mexico.

Have foreign workers taken the jobs of U.S. workers? Increased trade does lead to a reallocation of resources, as a country increases its output in those sectors where it has an advantage while cutting back production in other sectors. Resources should flow from the latter to the former, but in reality it can be difficult to switch employment across sectors. Daron Acemoglu and David Autor of MIT, David Dorn of the University of Zurich, Gordon Hanson of UC-San Diego and Brendan Price of MIT have found that import competition from China after 2000 contributed to reductions in U.S. manufacturing employment and weak U.S. job growth. They estimated manufacturing job losses due to Chinese competition of 2.0 – 2.4 million. Other studies find similar results for workers who do not have high school degrees.

Moreover, multinational firms do shift production across borders in response to lower wages, among other factors. Ann E. Harrison of UC-Berkeley and Margaret S. McMillan of Tufts University looked at the hiring practices of the foreign affiliates of U.S. firms during the period of 1977 to 1999. They found that lower wages in affiliate countries where the employees were substitutes for U.S. workers led to more employment in those countries but reductions in employment in the U.S. However, when employment across geographical locations is complementary for firms that do significantly different work at home and abroad, domestic and foreign employment rise and fall together.

Imports and foreign production, therefore, have had an impact on manufacturing employment in the U.S. But several caveats should be raised. First, as Erik Brynjolfsson and Andrew McAfee of MIT and others have pointed out, technology has had a much larger effect on jobs. The U.S. is the second largest global producer of manufactured goods, but these products are being made in plants that employ fewer workers than they did in the past. Many of the lost jobs simply do not exist any more. Second, the U.S. exports goods and services as well as purchases them. Among the manufactured goods that account for significant shares of U.S. exports are machines and engines, electronic equipment and aircraft. Third, there is inward FDI as well as outward, and the foreign-based firms hire U.S. workers. A 2013 Congressional Research Service study by James V. Jackson reported that by year-end 2011 foreign firms employed 6.1 million Americans, and 37% of this employment—2.3 million jobs—was in the manufacturing sector. More recent data shows that employment by the U.S. affiliates of multinational companies rose to 6.4 million in 2014. Mr. Trump will find himself in a difficult position if he threatens to shut down trade and investment with countries that both import from the U.S. and invest here.

The other form of globalization that drew Trump’s derision was immigration. Most of his ire focused on those who had entered the U.S. illegally. However, in a speech in Arizona he said that he would set up a commission that would roll back the number of legal migrants to “historic norms.”

The current number of immigrants (42 million) represents around 13% of the U.S. population, and 16% of the labor force. An increase in the number of foreign-born workers depresses the wages of some native-born workers, principally high-school dropouts, as well as other migrants who arrived earlier. But there are other, more significant reasons for the stagnation in working-class wages. In addition, a reduction in the number of migrant laborers would raise the ratio of young and retired people to workers—the dependency ratio—and endanger the financing of Social Security and Medicare. And by increasing the size of the U.S. economy, these workers induce expansions in investment expenditures and hiring in areas that are complementary.

The one form of globalization that Trump has not criticized, with the exception of outward FDI, is financial. This is a curious omission, as the crisis of 2008-09 arose from the financial implosion that followed the collapse of the housing bubble in the U.S. International financial flows exacerbated the magnitude of the crisis. But Trump has pledged to dismantle the Dodd-Frank legislation, which was enacted to implement financial regulatory reform and lower the probability of another crisis. While Trump has criticized China for undervaluing its currency in order to increase its exports to the U.S., most economists believe that the Chinese currency is no longer undervalued vis-à-vis the U.S. dollar.

Did globalization produce Trump, or lead to the circumstances that resulted in 46.7% of the electorate voting for him? A score sheet of the impact of globalization within the U.S. would record pluses and minuses. Among those who have benefitted are consumers who purchase items made abroad at cheaper prices, workers who produce export goods, and firms that hire migrants. Those who have been adversely affected include workers who no longer have manufacturing jobs and domestic workers who compete with migrants for low-paying jobs. Overall, most studies find evidence of positive net benefits from trade. Similarly, studies of the cost and benefits of immigration indicate that overall foreign workers make a positive contribution to the U.S. economy.

Other trends have exerted equal or greater consequences for our economic welfare. First, as pointed out above, advances in automation have had an enormous impact on the number and nature of jobs, and advances in artificial intelligence wii further change the nature of work. The launch of driverless cars and trucks, for example, will affect the economy in unforeseen ways, and more workers will lose their livelihoods. Second, income inequality has been on the increase in the U.S. and elsewhere for several decades. While those in the upper-income classes have benefitted most from increased trade and finance, inequality reflects many factors besides globalization.

Why, then, is globalization the focus of so much discontent? Trump had the insight that demonizing foreigners and U.S.-based multinationals would allow him to offer simple solutions—ripping up trade deals, strong-arming CEOs to relocate facilities—to complex problems. Moreover, it allows him to draw a line between his supporters and everyone else, with Trump as the one who will protect workers against the crafty foreigners and corrupt elite who conspire to steal American jobs. Blaming the foreign “other” is a well-trod route for those who aspire to power in times of economic and social upheaval.

Globalization, therefore, should not be held responsible for the election of Donald Trump and those in other countries who offer similar simplistic solutions to challenging trends. But globalization’s advocates did indirectly lead to his rise when they oversold the benefits of globalization and neglected the downside. Lower prices at Wal-Mart are scarce consolation to those who have lost their jobs. Moreover, the proponents of globalization failed to strengthen the safety networks and redistributive mechanisms that allow those who had to compete with foreign goods and workers to share in the broader benefits. Dani Rodrik of Harvard’s Kennedy School has described how the policy priorities were changed: “The new model of globalization stood priorities on their head, effectively putting democracy to work for the global economy, instead of the other way around. The elimination of barriers to trade and finance became an end in itself, rather than a means toward more fundamental economic and social goals.”

The battle over globalization is not finished, and there will be future opportunities to adapt it to benefit a wider section of society. The goal should be to place it within in a framework that allows a more egalitarian distribution of the benefits and payment of the costs. This is not a new task. After World War II, the Allied planners sought to revive international trade while allowing national governments to use their policy tools to foster full employment. Political scientist John Ruggie of the Kennedy School called the hybrid system based on fixed exchange rates, regulated capital accounts and government programs “embedded liberalism,” and it prevailed until it was swept aside by the wave of neoliberal policies in the 1980s and 1990s.

What would today’s version of “embedded liberalism” look like? In the financial sector, the pendulum has already swung back from unregulated capital flows and towards the use of capital control measures as part of macroprudential policies designed to address systemic risk in the financial sector. In addition, Thomas Piketty of the École des hautes etudes en sciences (EHESS) and associate chair at the Paris School of Economics, and author of Capital in the Twenty-first Century, has called for a new focus in discussions over the next stage of globalization: “…trade is a good thing, but fair and sustainable development also demands public services, infrastructure, health and education systems. In turn, these themselves demand fair taxation systems.”

The current political environment is not conducive toward the expansion of public goods. But it is unlikely that our new President’s policies will deliver on their promise to return to a past when U.S. workers could operate without concern for foreign competition or automation. We will certainly revisit these issues, and we need to redefine what a successful globalization looks like. And if we don’t? Thomas Piketty warns of the consequences of not enacting the necessary domestic policies and institutions: “If we fail to deliver these, Trumpism will prevail.”


cross posted with Capital Ebbs and Flows

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Castro is Dead

I have always been leery of libertarians, finding that most of them come from one of two infuriating groups: those who pretend negative externalities are trivial and (a much smaller group) those who are open about negative externalities not being trivial but look forward to the opportunity to inflict them on other people.

That said, this post at Popehat (a libertarian blog that focuses on first amendment issues) about Castro and his death is absolutely spot on. Years ago I wrote some of the same things here at Angry Bear, but never this well.

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The Electoral College, White Supremacy and Full Employment as “Reign of Terror”

Published in September 1947, Whither Solid South? A Study in Politics and Race Relations, by Charles Wallace Collins, “became both manifesto and blueprint” for the 1948 “Dixiecrat” campaign of Strom Thurmond and — over the longer term — the strategy whereby Southern white supremacists engineered a balance of power “lock” on the electoral college and thus on the Presidency. Matthew M. Hoffman examined the political consequences of that strategy in “The Illegitimate President: Minority Vote Dilution and the Electoral College,” published 20 years ago in the Yale Law Journal. Joseph Lowndes discussed the broader influence of Collins’s book on the emergence of a “New Right” in From the New Deal to the New Right: Race and the Southern Origins of Modern Conservatism. Collin’s strategy can be summed up in a few paragraphs from chapter 17 “The South Need Not Surrender”:

Neither the Negroes nor any of the groups which support them can alone, or in conjunction with each other, give assurance of control of a single vote in the Electoral College. … In comparison with them, the South is a political giant. … The South, being a geographical minority with a one-party system, would know at all times its minimum strength and from that work toward its maximum.

The eleven former seceding Southern States possess 127 votes in the Electoral College. These States hold 22 seats in the Senate and 105 in the House. Additional support on many southern questions may be expected from the four border States which have 43 votes in the Electoral College, 8 Senators and 35 Members of the House.

The aggregate of votes of the southern region is 170 in the Electoral College, 30 in the Senate and 140 in the House — nearly one-third in each. On questions which peculiarly affect the southern region, on the Negro equality question and on radical labor questions, these States may be expected to stand with the South in the Congress.

I have emphasized two phrases in the above excerpt. Collins candidly described the “Solid South” concept as a one-party system. A segregationist South was to dominate national politics by eschewing popular choice. “States rights” were to prevail over the rights of the citizens of those states. Collins’s notion of a white-supremacist lock on the electoral college did not rely on winner-take-all popular elections. In a 1944 pamphlet, he upheld the constitutional propriety of an elector deciding “to vote in the Electoral College for a person whom he thinks will protect the interests of his state rather than for a person nominated at a national party convention whom he thinks would be hostile to them.”

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Will the Soviet Union Survive Until 1984? Part 1

One of the more unique books on my shrinking number of bookshelves (we are in the e-book era after all, so every time we move, fewer hard copies move with us) is called Will the Soviet Union Survive Until 1984? It was written by a Soviet dissident named Andrei Amalrik and published in 1970.

I was thumbing through the book randomly the other day and happened on a passage which happens to be the reason I have never given the book away:

It now became evident that in Soviet law there exists, if I may use the term, a broad “gray belt” – activities which the law does not formally forbid but which are, in fact, forbidden in practice-for instance: contacts between Soviet citizens and foreigners; a concern over non-Marxist philosophies or art inconsistent with the notions of socialist realism; attempts to put out typewritten literary collections; spoken or written criticism not of the system as a whole, which is forbidden under Articles 70 and 190/1 of the Criminal Code, but particular institutions within the system.

This sort of setup – where some topics are de facto illegal – destroys the social fabric in a country. If people know that that saying X will cost them their livelihood, most of them won’t say X. But that doesn’t mean they won’t believe it. In fact, knowing that X cannot be discussed is just going to convince more people that there must be something to it. Refutations of X from those authorized to state what is good and what is true will only serve to make matters worse.

Also, even if X is not true, people will mouth approved denials of X but nobody competent to do so will actually go through the effort of proving X is wrong. After all, in matters like this, the views that are acceptable to hold become progressively narrower and more specific over time. The hero who proves X wrong today is sent to the Gulag tomorrow. Tomorrow, the proof doesn’t show that X is wrong enough.

Worse still for Comrades Yuri and Svetlana who only want to survive and raise their children, sometimes the pendulum swings the other way.

Lysenkoism, a fraud cooked up by a charlatan based on fake data was (rightly) a crackpot idea in 1927. By the mid 1940s it was textbook Soviet Biology and the Trotskyite wreckers, Western stooges and Nazi sympathizers who opposed it had already been processed through the People’s Courts. And then, in the 1960s, another turnabout. Lysenkoism was denounced. But the famines it had caused had still happened, and the biologists, geneticists and (might I add) the statisticians who had called bull&$%# were still dead.

The New Soviet Man was, is, and always will be on the march. Of course, the Soviet Union did make it to 1984. But alas, it had already done so by 1920, if not earlier.

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More From Borjas on Immigration in 1996

More from the 1996 Borjas article on Immigration I cited yesterday. All of this should be familiar to anyone who has been reading my posts. It’s also the same findings for which I keep getting attacked in comments. The funny thing is, numbers are numbers and the results are the same whether I do the analysis or a Harvard professor does it:

Consider the received wisdom of the early 1980s. The studies available suggested that even though immigrants arrived at an economic disadvantage, their opportunities improved rapidly over time. Within a decade or two of immigrants’ arrival their earnings would overtake the earnings of natives of comparable socioeconomic background. The evidence also suggested that immigrants did no harm to native employment opportunities, and were less likely to receive welfare assistance than natives. Finally, the children of immigrants were even more successful than their parents. The empirical evidence, therefore, painted a very optimistic picture of the contribution that immigrants made to the American economy.

In the past ten years this picture has altered radically. New research has established a number of points.

• The relative skills of successive immigrant waves have declined over much of the postwar period. In 1970, for example, the latest immigrant arrivals on average had 0.4 fewer years of schooling and earned 17 percent less than natives. By 1990 the most recently arrived immigrants had 1.3 fewer years of schooling and earned 32 percent less than natives.
• Because the newest immigrant waves start out at such an economic disadvantage, and because the rate of economic assimilation is not very rapid, the earnings of the newest arrivals may never reach parity with the earnings of natives. Recent arrivals will probably earn 20 percent less than natives throughout much of their working lives.
• The large-scale migration of less-skilled workers has done harm to the economic opportunities of less-skilled natives. Immigration may account for perhaps a third of the recent decline in the relative wages of less-educated native workers.
• The new immigrants are more likely to receive welfare assistance than earlier immigrants, and also more likely to do so than natives: 21 percent of immigrant households participate in some means-tested social-assistance program (such as cash benefits, Medicaid, or food stamps), as compared with 14 percent of native households.
• The increasing welfare dependency in the immigrant population suggests that immigration may create a substantial fiscal burden on the most-affected localities and states.
• There are economic benefits to be gained from immigration. These arise because certain skills that immigrants bring into the country complement those of the native population. However, these economic benefits are small — perhaps on the order of $7 billion annually.
• There exists a strong correlation between the skills of immigrants and the skills of their American-born children, so that the huge skill differentials observed among today’s foreign-born groups will almost certainly become tomorrow’s differences among American-born ethnic groups. In effect, immigration has set the stage for sizable ethnic differences in skills and socioeconomic outcomes, which are sure to be the focus of intense attention in the next century.

The United States is only beginning to observe the economic consequences of the historic changes in the numbers, national origins, and skills of immigrants admitted over the past three decades. Regardless of how immigration policy changes in the near future, we have already set in motion circumstances that will surely alter the economic prospects of native workers and the costs of social-insurance programs not only in our generation but for our children and grandchildren as well.

But let us be realistic. You don’t need to be a numbers person to reason any of this out. In the age of Google, all this is fairly obvious to anyone who cares to think about the issue.

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Borjas on Immigration in 1996

George Borjas is out with a new book on immigration. It’s title, “We Wanted Workers” comes from a comment by a Swiss playwright which translates roughly as “we wanted workers but we got people instead.”

I am swamped and haven’t gotten to Borjas’ book yet (truth to tell – there is a lot of stuff higher on my current to do list and time is limited) but he has been pretty consistent for a long time. Here is a lengthy article he wrote for The Atlantic in 1996. This piece may be a good summary of what Borjas keeps noting, and which seems self-evident to me given current immigration policy in the US:

Economic research teaches a very valuable lesson: the economic impact of immigration is essentially distributional. Current immigration redistributes wealth from unskilled workers, whose wages are lowered by immigrants, to skilled workers and owners of companies that buy immigrants’ services, and from taxpayers who bear the burden of paying for the social services used by immigrants to consumers who use the goods and services produced by immigrants.

There is nothing wrong with taking the position that current policies should be continued and even expanded. There is something wrong with denying what that implies. Policies are something we as a country pick. They aren’t handed down from the heavens or etched in stone. If we choose to favor low skilled immigrants and the businesses that employ them over the taxpayer and low skilled workers already in the country, let us at least be honest about it.

Full disclosure – I have structured my affairs so that in general, I benefit from the policies that have been in place over the last few decades. I recognize that many Americans don’t have that option.

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Four Years

It is four years from now. A lot has changed. Some of the changes have been positive, some negative. What are the changes that in retrospect were the most impactful but also should have been among the most obvious a day or two after Thanksgiving 2016?

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