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Over the next week Congress is likely to pass SCHIP, the program designed to provide health insurance to children who do not have it.  As these two stories show (here and here), the debate on SCHIP - the very first bill brought up by the new Congress - has already been impacted by the ongoing debate over immigration, with the Senate and House now planning on passing different versions of the legislation.  In response to questions from several reporters today, I issued the following statement: 

"That the debate over SCHIP has immediately become a debate about immigration should be a clear warning to the Administration and Congress that progress on many important domestic priorities this year may get caught up in the debate on how to best fix our broken immigration system. It is our belief that rather than having a series of tough and contentious proxy fights on immigration, our leaders should recognize that passing comprehensive immigration reform this year will not only help fix our badly broken immigration system - a priority of many Americans - but may also be the key to unlocking bipartisan progress on a whole range of other domestic and security related issues." 

There are many good reasons to fix our broken immigration system by passing comprehensive immigration reform this year: it is a well-crafted fix to a serious national problem; it has the overwhelming support of the American people and a deep and broad bi-partisan coalition behind it; it will demonstrate that Congress and the President have the ability to tackle the hard ones; it will help weaken the vast and increasingly dangerous culture of illegality in the border region, which will help our law enforcement officials address more pressing problems; it was able to muster 62 votes and pass a Republican Senate, demonstrating that this is not a toxic or "third rail" issue; it will help us better manage the all too porous border in a time of possible terrorist attacks; it will ensure that five percent of our workforce has the protection of American law, is paid minimum wage and has the right to unionize, something these workers do not have today; it will help quiet the very public demonstration of hatred and racism that has spilled out during this debate; and for the Democrats it will deliver on a promise made to the fastest growing part of the electorate, one that was critical to their victory. 

But as our country's leaders are also finding out with SCHIP, passing comprehensive immigration reform will also be a key that unlocks progress on other critical domestic priorities.  I hear talk in Washington that perhaps this issue will fall to 2011, or 2012.  To me this makes no sense.  Immigration Reform should be tackled this year.  Our broken immigration system is a vexing national problem that the American people want solved.  It is contributing to an increasingly dangerous border region, clogging our courts, tossing a federal problem back down to the states, and causing terrible harm to millions of families across the country.  Not solving it - when manifestations of it dominate the local news every day - makes our leaders look weak, fearful, political.  It will also slow down progress on lots of other issues, from housing and foreclosure reform, universal health care to putting laptops in the backpack of every child. These and other areas that will be subject to questions about whether the benefits confered may somehow be used by an undocumented immigrant or their children. 

Thus, the new Congress and the new Administration should be smart, pass comprehensive immigration reform this year.   The legislative process should start with a version of the original Kennedy-McCain bill from 2006, and its formula that called for cracking down on the border and on exploitive employers, better management of the future flow of both high and low skilled immigrants, and legalizing the status and offering a path to citizenship for those already here.  By doing so our leaders will not only be doing the right thing, they will free up the nation from the debilitating proxy fights over immigration that will continue to plague so many legislative battles in the years ahead.

NDN President Simon Rosenberg and NDN Vice President for Hispanic Programs Andres Ramirez today said President-elect Barack Obama's meeting with Mexico President Felipe Calderón this afternoon signifies more than long-standing protocol; it also reflects the realities of deeply rooted economic, cultural and political ties betweenthe two countries.

"Never before has a U.S. President been elected by such an overwhelming number of Hispanics in the United States," Rosenberg said. "The United States now has the third largest Latin population in the Americas and the futures of the United States and Mexico are bound together as never before. Hemispheric relations have taken a backseat for too long. Today's meeting is the first step to a genuine and sustained partnership that addresses pressing regional and global challenges. It  is the start of a new day for U.S.-Mexico relations."

"This meeting follows the commitment expressed by President-elect Obama and his advisors throughout the 2008 presidential campaign and during the presidential debates to make it a priority to build a more profound and engaged bilateral relationship with Mexico," Ramirez said. "This meeting also occurs at a time when Mexico is better positioned as a partner of the United States. Since the 2000 election in Mexico, that country has demonstrated major progress in governance, in its democratic institutions and it has developed increasingly diverse international economic and political relations."

Click here for additional background information on NDN's work in studying Latin America foreign policy.

Edmund Andrews and David Herszenhorn of the New York Times today offer a very good overview of the how the debate over the economy is shaping up.  It begins:

WASHINGTON - The fresh evidence on Friday of the economy's downward spiral focused even more attention on two questions: Is the stimulus package being pushed by President-elect Barack Obama big enough? And will the component parts being assembled by Congress provide the most bang for the buck?

With the Federal Reserve having just about reached the limit of how much it can help the economy with cuts in the interest rate, Washington's ability to end or at least limit the recession depends in large part on the effectiveness of the big package of additional spending and tax cuts that Mr. Obama has made the centerpiece of his agenda.

And with the economy facing what now seems sure to be the sharpest downturn since the 1930s, the financial system balky and the government facing towering budget deficits, economists and policy makers acknowledge that there is no playbook.

"We have very few good examples to guide us," said William G. Gale, a senior fellow at the Brookings Institution, the liberal-leaning research organization. "I don't know of any convincing evidence that what has been proposed is going to be enough."

In part because Mr. Obama wants and needs bipartisan support, the package is being shaped by political as well as economic imperatives, complicating the process by putting competing ideological approaches into the mix.

It includes $300 billion in temporary tax cuts for individuals and businesses, in part to attract Republican support. It includes a big expansion of safety-net programs like unemployment insurance, which Democrats say makes both economic and social sense. It includes more money for highways, schools and other public infrastructure; more money for "green" energy projects; and more money to help state governments pay for health care and education.

Republicans, as always, are advocating for more and broader tax cuts. But the evidence is ambiguous about whether tax cuts will really spur economic activity at a time when consumers and businesses alike are frozen in fear and reluctant to let go of their money.

The risk is that Mr. Obama and the Congress will weigh down their effort with measures that cost many billions of dollars but may not have much impact on economic activity.

Tax breaks, for example, usually produce less than $1 of stimulus for every dollar they cost, economists say. Spending on public construction projects, like highways and bridges, produces the most economic activity - but there is a limit to how many projects are "shovel-ready," and even those take time to generate jobs and ripple through the economy.

You can read the rest here.  For more on our take on all this you can find many posts from recent weeks on the blog, and be certain to review this recent compilation of our economic writings over the last few years.  Be sure to review what has become one of our more influential works, A Stimulus for the Long Run.

Barack Obama's historic election as a new, national agent of change will face a daunting test as the economic crisis continues to accelerate, and the political pressures arising from what must now be called “The Great Recession” begin to reshape the response.

The latest evidence is today’s unemployment data: one million jobs lost in two months; the sharpest eight-month rise in the jobless rate since 1945, when tens of millions of soldiers and sailors were demobilized; and losses across every sector and every region. Jobs are in freefall along with the markets, investment, consumer spending and household wealth. And economists are now genuinely frightened by the course the Great Recession is taking, because there’s been nothing like it in anyone’s experience.

That’s why long-time advocates of fiscal probity now call for stimulus topping $1 trillion, and why every spending and tax idea floating around Congress for the last decade is back on the table again. The political pressures and real concerns are so overwhelming that there’s talk of large tax cuts, despite the consensus among economists that when people and businesses are as economically downcast as they are today, tax relief has little stimulus power. That’s not only politics at work; it also reflects a sense of grave foreboding among many of those same economists.

We do need unprecedented stimulus – but all of the stimulus in the world won’t change the course of this crisis until we also address its underlying forces. The wealth of American households and the portfolios of American financial institutions will continue to tank until the housing market stabilizes -- or at least until foreclosure rates return to normal. And the most aggressive, easy policy in our history won’t be enough, and financial institutions won’t begin normal lending again, until they’re more confident that the hundreds of billions of dollars in mortgage-backed securities and other derivatives they still own aren’t headed for the drain as well.

The new Administration can take on these challenges directly, as candidate Obama pledged to do with extraordinary foresight. For example, we can impose a 90-day moratorium on foreclosures and use the time to renegotiate the terms of tens of thousands of distressed mortgages held by Fannie Mae and Freddie Mac. One idea promoted by many economists is to convert those mortgages to 30-year fixed at 5.25 percent, which happens to be long-term mean rate for Fannie and Freddie mortgages. It won’t stop foreclosures, but it should bring down foreclosure rates to near-normal levels, which would do more to stabilize the financial system than the bailouts in the Bush Administration’s own Wall Street version of tsunami stimulus. And some tough love from the new Treasury Secretary could help restart the lending process: having done what we can to stabilize the value of their portfolios, we should consider requiring institutions receiving federal aid to use a real share of that assistance to restart their lending.

We need large-scale stimulus, but it will only work if we first address the underlying problems. Otherwise, 18 months from now, we could be $1 trillion poorer and have little to show for it.

Morley Winograd and Michael D. Hais are fellows of NDN and the New Policy Institute and co-authors of Millennial Makeover: MySpace, YouTube, and the Future of American Politics (Rutgers University Press: 2008), named one of the 10 favorite books of New York Times Pulitzer Prize-winning book critic Michiko Kakutani in 2008.

The selection of former Secretary of State Colin Powell to announce the Obama Administration's national service initiative, "Renew America Together" (USAService.org), is much more than a smart political move. It’s a perfect down payment on the promises Obama made to his most ardent supporters, the Millennial Generation (born 1982-2003).

The support of young voters was decisive in Obama's narrow nomination victory over Hillary Clinton and their 2:1 margin for him over John McCain accounted for 80 percent of his nearly nine million national popular vote lead last November. By giving Powell this important and visible role, Obama simultaneously burnishes his bipartisan credentials and demonstrates his understanding that the United States has moved to a new era dominated by the outlook of a new generation determined to make America a stronger and more unified country.

Millennials are of an archetype labeled "civic" by the seminal generational theorists William Strauss and Neil Howe. Like all other civic generations throughout American history, Millennials are defined by their strong desire to advance the welfare of the entire group and, by extension, all of society. The willingness of Millennials to help make things better was reflected in their enthusiastic reaction to Obama’s call during the campaign for a program aimed at young people that would help them pay for college in exchange for two years of public service, either in the military or one of the federal civilian service organizations. While the financial concerns of a generation heavily burdened by educational debt may have partially accounted for the loud applause this idea always generated, there is far more to it than self-interest.

A 2004 Harvard University Institute of Politics survey indicated that 85 percent of college-age Millennials considers public service an effective way to solve problems facing the country. A virtually unanimous 94 percent say that volunteer activity is effective in dealing with challenges in their local community.

Millennials have already clearly demonstrated their strong willingness to put these attitudes into action by participating in service programs in large numbers. In 2004, 80 percent of high school students, all of whom were Millennials, participated in community service activities. This contrasts with only 27 percent of high school students, all whom were members of the much more individualistic Generation X, that did so in 1984. Stemming from the virtually total public service participation of Millennials, by 2006 more than a quarter of those who volunteered for one of the federal government's National Service organizations (26 percent) were 16-24 year olds. That was twice the contribution of young people in 1989, when all of those in the 16-24 year old cohort were Gen-Xers.

But this won't be the first time that a civic generation has rallied to the service of America. And, it won't be the first time that a grateful country has rewarded this service. After the GI Generation great-grandparents of today's Millennials helped to defeat the Axis in World War II, the Servicemen's Readjustment Act, better known as the GI Bill of Rights, sent millions of returning veterans to college. This was not only a just reward for a job well done; it was also excellent public policy. By exponentially increasing the number of American college graduates and the size of the country's middle class, it paved the way for the long period of post-war growth that made the last half of the 20th century the American Century. If history is any guide, the Millennial Generation will follow in the footsteps of the GI Generation and through its dedication to public service will leave America an even stronger country than the one they inherited.