Tag Archives: economy

Abusing Immigrants

Public Policy and Governance, ,

Republican hysteria about immigration at the southern border is both stupid and racist: Stupid, because most people who are in this country illegally have flown in and overstayed their visas, and racist because–hey!–it’s the GOP and those people at the southern border tend to be brown.

The GOP’s anti-immigrant fervor isn’t so different from the anti-immigrant hatred documented by Ken Burns in “America and the Holocaust”–only the targets have shifted. A little.

In light of DeSantis and Abott’s  recent efforts to prove that “libtards” don’t understand the terrible threat posed by brown people trying to escape horrific situations, I thought I’d share some inconvenient things called “facts.”

I know facts are out of fashion these days, but it is instructive to look at the actual impact of immigration. As David Brooks wrote a few years back,  “when you wade into the evidence you find that the case for restricting immigration is pathetically weak. The only people who have less actual data on their side are the people who deny climate change.”

So what are the facts—as opposed to the xenophobic fears? A couple of years ago, I did some research; this is what I found then.

Immigrants make up about 14% of the U.S. population; more than 43 million people. Together with their children, they are about 27% of us. Of the 43 million, approximately 11 million are undocumented.

What anti-immigrant activists like to call “chain migration” is actually family re-unification and it applies only to close relatives; of the people granted permanent residency in 2016, about two-thirds fell into that category.

Immigrants made up 17% of the U.S. workforce in 2014, and two-thirds of those were here legally. Collectively, they were 45% of domestic workers, 36% of manufacturing workers, and 33% of agricultural workers. Those percentages help to explain why state-level efforts to curb immigration have come back to bite them: in Alabama a few years ago, when the state passed a draconian new immigration law, crops rotted in the fields. Farmers couldn’t find native-born residents willing to do the work.

Right now, restaurants are desperate for waitstaff and kitchen help.

Despite the hateful rhetoric from the GOP, most Americans today consider immigration a good thing: in 2016, Gallup found 72% of Americans viewed immigrants favorably, and as many as 84% supported a path to citizenship for undocumented persons who met certain requirements. Another poll showed that 76% of Republicans supported a path to citizenship. (It’s worth noting that such support was higher than the 62% who supported a border wall.)

What about the repeated claims that immigrants are a drain on the economy? The data unequivocally shows otherwise. As the Atlantic and several other sources have reported, undocumented immigrants pay billions of dollars into Social Security for benefits they will never receive. These are people working on faked social security cards; employers deduct the social security payments and send them to the government, but because the numbers aren’t connected to actual accounts, the worker can never access the contributions. The Social Security system has grown increasingly—and dangerously– reliant on that revenue; in 2010, the system’s chief actuary estimated that undocumented immigrants had contributed roughly 12 billion dollars to the program.

The Institute on Taxation and Economic Policy estimates that approximately half of undocumented workers pay income taxes, and all of them pay sales and property taxes. In 2010, those state and local taxes amounted to approximately 10.6 billion dollars.

The most significant impact of immigration by far has been on innovation and economic growth. The Partnership for a New American Economy issued a research report in 2010: the key findings included the fact that more than 40% of Fortune 500 companies were founded by immigrants or their children. Collectively, companies founded by immigrants and their children employ more than 10 million people worldwide; and the revenue they generate is greater than the GDP of every country in the world except the U.S., China and Japan.

The names of those companies are familiar to most of us: Intel, EBay, Google, Tesla, Apple, You Tube, Pay Pal, Yahoo, Nordstrom, Comcast, Proctor and Gamble, Elizabeth Arden, Huffington Post. A 2012 report found that immigrants are more than twice as likely to start a business as native-born Americans. As of 2011, one in ten Americans was employed by an immigrant-run business.

On economic grounds alone, then, we should welcome immigrants. But not only do we threaten undocumented persons, we make it incredibly difficult to come here legally. If there is one fact that everyone admits, it is the need to reform a totally dysfunctional and inhumane immigration system. Based upon logic and the national interest, it’s hard to understand why Congress has been unwilling or unable to craft reasonable legislation.

Of course, logic and the national interest have been missing from Washington for some time. Compassion went with them.

Bigotry, however, continues to thrive.

 

 

 

 

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The More Things Change…?

Random Blogging, , ,

It feels as if I’ve been on “lockdown” forever, and I know others are equally “over” a pandemic that is anything but over. There just aren’t that many rooms to be deep cleaned, that many books to be read, or–in my case–that many blogs to be written.

The rest of the time, then, becomes available for worrying.

I’ve been particularly concerned about what will happen to the center of my city in the wake of Covid-19. My husband and I moved to downtown Indianapolis in 1980, when things were still pretty sketchy, and we’ve celebrated the subsequent rebirth of a flourishing urban core. We’ve been excited to see new homes and apartments being built, we’ve marveled at our inability to patronize all of the new restaurants and bars (although we really tried!). We’ve worried as online retailing has reduced the number and variety of shops.  And we were heartbroken when we drove past all the boarded-up windows in the wake of the one protest that included such destruction.

Predictions about “what will come next” are everywhere. Most aren’t worth the paper they’re printed on (or the bytes they represent), but I tend to respect the scholars at the Brookings Institution, who’ve weighed in with their analysis.

The Brookings report suggests that COVID-19 will accelerate or intensify many trends that are already underway, which makes a lot of sense to me.

The report noted that retailers, along with their landlords and suppliers, were already “responding to multiple industry-wide  trends” (aka “in a world of hurt”) before the coronavirus. Trump’s tariffs hurt an industry that was already reeling from shifts in consumer demand from products to experiences, e-commerce, and the sharing economy. The pandemic is accelerating an already pressing need to embrace new models.

The report is light on specifics, but does predict that profit-sharing leases will be an “increasingly important tool to help new businesses get started, survive slowdowns, and provide a return to landlords who invest in their tenants’ success.”

The report’s predictions about food really comforted me. (Comfort food? Sorry…)

Convergence and hybridization will accelerate in food retail, which will return to be a “revitalizing force in urban life.” IKEA was already a furniture showroom, warehouse, and restaurant. High-end grocers were encouraging shoppers to have a beer. Restaurants were increasingly not just dine-in, but fast-casual or mobile food trucks. Whether through app-based delivery or prepared foods from wholesalers such as Costco, Americans will return to eating much of their food prepared outside the home. In 2017, jobs in leisure and hospitality (which includes all bars and restaurants) grew to outnumber jobs in retail trade. The pandemic is a setback, but not a reset.

On the negative side, the researchers expect that the 50- million- plus low wage workers will continue to face unsupportable housing costs– and that households that previously strained to pay rent will find it impossible. They also see worse labor market outcomes for older workers who lose their jobs.

So what does all of that portend for cities?

Some urban dwellers who have decamped to less dense areas will undoubtedly stay there permanently,  “irrespective of the many amenities and agglomeration economies urban centers have to offer.” But the researchers note that the period following the Great Recession saw major metros gain more population than their suburbs

Why was this happening in a tepidly recovering economy? A good deal was attributable to young adult millennials. Unable to find jobs and housing in large stretches of the country, they found urban centers attractive. Eventually, the economy rebounded, jobs dispersed and many young adults dispersed with them. But large metro areas still prospered even with slower growth, as Brookings’s Metro Monitor 2020 revealed.

What does this mean for the post-COVID-19 period? Much will depend on Gen Z, an educated and racially diverse generation with strong urban roots.

In other words, if Gen Z  wants and needs what urban life has to offer, they’ll opt to remain.

We will face huge challenges once the pandemic is over and Trump is (fingers crossed) a  horrific memory. We will need to restore a functioning and ethical federal government, address our enormous inequalities with social investment and a comprehensive, adequate social safety net–and continue the work of making our cities  vital, livable places to live and work.

 

Lessons We’re Having to Learn The Hard Way

Public Policy and Governance, ,

The news just keeps getting progressively worse.

It’s pretty clear that in addition to a global pandemic, we will experience a global economic meltdown. As state governments have stepped up to compensate for the lack of federal leadership, restaurants and bars, gyms and cultural venues have been ordered to close; many will be unable to weather weeks with no income, and will never re-open.

As one of my friends recently noted in a post to Facebook, Coronavirus would have battered the U.S. to some extent no matter who was in the White House. But an even minimally-competent President “would have listened to the public health experts and taken action, realizing that this was about the country and NOT about him (or her) self.”

And most likely, no other president would have rejected the WHO’s offer of test kits, or dismantled the global health emergency task force that was set up to deal with a pandemic. And no other president would likely brazenly lie on a daily basis even as his own administration’s experts contradicted his lies and imbecilic pronouncements. In short, Trump deserves “credit” for the extent of this catastrophe, the long and outrageous delay in taking action, and the economic meltdown that will result, along with many of the (probably unnecessary) deaths that we will see.

So–lesson number one: elections matter. Competent government matters. The character and intelligence of our elected officials matters.

Lesson number two: we’re connected to the rest of the world. Discussion of a “global pandemic” and “global economy” should give “America First” xenophobes pause. (It won’t, but it should.) We really are ALL in this together. Today’s world is far too connected for the walls, travel bans and reflexive hatred of darker “others” that characterize the Trumpublicans’ approach to the rest of the world. Not only are those measures useless and stupid, especially during a pandemic, they inevitably hurt America more than they hurt those “others.” Global cooperation is absolutely essential, not just to the management of health threats, but to efforts to mitigate economic damage.

Lesson number three is another take on the fact that we truly are all in this together–and by “this” I don’t just mean this particular health crisis or this specific economic threat. We humans are– in far more than the biblical sense–our brothers (and sisters) keepers. A government that is not structured on recognition of that fact will be unable to mitigate disasters.

What does that mean? It doesn’t mean abandonment of market economics, but it does mean provision of a far more robust and less haphazard social safety net.

In a recent analysis, the Brookings Institution acknowledged that reality.

In addition to the dire risk to individual health, side effects of the coronavirus pandemic are sure to include widespread economic hardship and uncertainty. If you experience these symptoms, you’re mostly on your own—as the virus reveals a grossly inadequate safety net and willfully ineffective political system that are poised to leave our most vulnerable workers bearing the brunt of the economic and social impact.

The self-quarantines and social distancing measures taken in response to COVID-19 are critical to keeping people safe by reducing exposure to the virus and slowing its spread. But we can already see the strains in our health care system that foreshadow even greater disruptions in the weeks and months to come. Similarly, we are witnessing the unavoidable side effects of social distancing: the reduced economic activity that ensues when masses of people stay home or avoid large gatherings. In turn, this translates into reduced demand for workers….

In the United States, 53 million people must get by on low wages, with median hourly earnings of $10.22. Some of the largest occupations employing these workers are also the most susceptible to the economic slowdown accompanying the virus’ spread: 5 million food service workers, 4.5 million retail clerks, and 2.5 million custodians and housekeepers. When college campuses empty out, when stadiums don’t host games, or when conferences are cancelled, it means that food servers, cooks, clerks, and housekeepers are out of work. And many low-wage workers and those in sales and service industries lack paid sick or vacation leave, which results in no earnings coming in at all.

The plutocrats who have been enriching themselves through public subsidies and tax cuts while disregarding the precarious state of low-wage workers are going to learn a very unpleasant lesson: when millions of people lose their ability to participate in the marketplace–when they no longer have the means to buy the widgets produced by the plutocrats’ factories or to shop for the services and products in which the wealthy have invested–  stock portfolios and tax havens won’t shelter them from that storm.

Ultimately, fortunate people are only secure when everyone is secure.

Toto: We Aren’t In Brownback’s Kansas Anymore

Public Policy and Governance, , ,

Remember Sam Brownback? When he was elected Governor of Kansas, he vowed that the GOP’s economic theology–aka “trickle down”– would create an economic paradise, and he immediately set about implementing that theology.

In 2012, with the help of Kansas’ overwhelmingly Republican legislature, Brownback completely eliminated income taxes for more than 100,000 businesses and significantly reduced taxes on the wealthy.

For years, Republicans have been telling us that such steps would boost economic growth, and that they would more than pay for themselves, and Brownback was evidently a True Believer. Ardent belief notwithstanding, Brownback’s policies not only failed to deliver the promised prosperity, they devastated the state’s economy.

State revenues fell dramatically. School years and school days were shortened, public construction projects came to a screeching halt, Medicaid benefits were reduced, and job creation simply stopped.

As Harold Myerson has reported (link unavailable),

By 2016, Kansas voters—including Republicans who objected to seeing their children’s educations shortchanged—revolted. As the Prospect’s Justin Miller reported at the time, Republican primary voters, joined by Democrats, ousted legislators who refused to repeal the tax cuts, and in 2017, the new legislature overrode Brownback’s veto of a bill repealing the cuts. In 2018, voters elected Democrat Laura Kelly as their new governor, and today, with adequate funding restored, Kansas has resumed its support for education, infrastructure, and the basics of civilization.

This month, CNBC came out with its annual list of America’s Top States for Business, a ranking on which states don’t move up or down very much from one year to the next. Which is why attention must be paid, as Americans for Tax Fairness has pointed out, to one massive exception to this rule. On this year’s list, Kansas placed 19th—which is a full 16 places higher than it placed last year.

There’s a lesson there, but some people–and political ideologues–refuse to learn.

Trump and Mitch McConnell repeated what I’ve come to call the “Brownback Argument” to justify what Myerson dubs “the Great Federal Tax Giveaway to Corporations and the Rich Act of 2017–18.”

In consequence, share buybacks have soared to new heights while wages and infrastructure investment have barely risen, when they’ve risen at all. The federal government, of course, can run deficits, while states are constitutionally prohibited from doing so—which is why the Trumpistas have chiefly engaged in targeted rather than across-the-board cutbacks in federal spending. (The targets, of course, have been the poor and minorities.)

Brownback was politically run out of town on a rail—resigning early in 2018 to become the Trump administration’s Ambassador at Large for International Religious Freedom. (Unlike Tsarist Russia, our government lacks a position like Procurator of the Holy Synod, a sort of directorship of pogroms, though Stephen Miller at times seems to have become that position’s functional equivalent.) Is it too much to hope that American voters relegate Trump to history’s dustbin as their Kansas compatriots did to Brownback?

We can hope–for reasons including but definitely not limited to idiotic economic policies.

If there is one thing that the cult that is today’s Republican Party has repeatedly demonstrated, it’s that both religion and political ideology rely on faith rather than evidence.

 

Not-So-Merry Christmas?

Public Policy and Governance, , ,

I keep remembering the line Yul Brynner used  whenever he was faced with a conundrum in The King and I?  “It’s a puzzlement.”

As Americans count down to the 2020 elections, those of us who view the Presidential contest as a critical referendum on the American Idea and the rule of law are torn. We want to stop this corrupt and incompetent administration from doing even more harm between now and then, but we also know that preventing the worst consequences of Trump’s madness will work in his favor.

Take the damage being done to the economy by his ham-handed imposition of tariffs.

As an article in the Washington Post recently put it,

There’s a case to be made that Trump has the upper hand in these trade disputes because the United States buys more from China and Mexico than those countries buy from the United States. To put it another way, China and Mexico need Trump economically more than he needs them.

But that’s just the raw economic calculation. Trump is also facing a campaign for reelection in 2020, and he’s banking on a strong economy to propel him to victory. There are already signs that Trump’s trade policies are making the markets and economy jittery, and the pain is likely to escalate if he doesn’t make some deals by September.

People who actually understand economics and trade policy (a category that clearly excludes Donald Trump) are warning that America’s economy is losing steam. Despite Trump’s fantasies, coal is dying, factories aren’t coming back and companies that are still here are pocketing their tax windfalls, not creating new jobs.

Tariffs are taxes on the American people. So far, those costs have been modest. As Trump and top White House officials frequently point out, inflation (a good gauge of price increases across the economy) has remained low, which helps explain why there hasn’t been widespread public revolt over the tariffs, except among farmers and some manufacturers who have been hit the hardest.

Experts who follow economic trends warn that the costs of Trump’s delusional “dealmaking” are likely to ramp up in August and September. That’s because he appears intent upon announcing new rounds of tariffs– thus dramatically increasing the costs Americans will have to pay for goods, and making it probable that people will notice that they, not China, are paying the tab for Trump’s version of trade policy.

August and September are when U.S. retailers import goods for the holiday shopping period. Retailers warn that If Trump’s tariffs are still in place then, “it will be nearly impossible not to pass some — if not all — costs on to consumers for holiday season 2019.”

Consider the numbers. At the start of the year Trump’s tariffs cost the typical family of four about $480 a year, according to calculations by the right leaning Tax Foundation and The Washington Post. Last month Trump increased tariffs on China, which lifted the cost for a typical family of four to $860 a year…If Trump moves forward with his other threat to put tariffs on all Chinese imports by the end of the summer, the cost would jump even higher — to more than $2,000 for a family of four.

And it’s not just higher costs. Retailing–and retail employment– is already on the ropes. As one columnist recently noted,

Last week, 661 firms — including major players such as Costco, Target and Hallmark — signed a letter pleading with the administration not to use tariffs as a cudgel in its efforts to address China’s trade abuses. The USTR has also received more than 1,600 written comments thus far, overwhelmingly negative.

These, like the USTR public hearings, echo what big retailers had already been warning investors and customers: Sweeping tariffs will stress already-thin profit margins and lead to layoffs. They will also raise prices for U.S. households by hundreds or thousands of dollars, wiping out the value of Trump’s tax cuts.

My only quibble with that letter is with the notion that the tax cuts had value…

So here’s the conundrum: Consumer spending is the backbone of the U.S. economy. If Trump continues with his “Tariff Man” antics, the economy will suffer, and the working poor, as usual, will bear the brunt of the pain.

On the other hand, other than appeals to racism, Obama’s economy is pretty much the only thing Trump has going for him.

Should good Americans root for a downturn that would be likely to ensure Trump’s defeat, even though it would cause pain for so many people? Or should we hope that sane policymakers can keep him from tanking the economy–  thereby improving his election prospects?

It’s a puzzlement.