Economy

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Time for progressives to stand against "the misery strategy" for resolving our immigration crisis

The Times weighs in with an excellent, though incomplete, editorial today.  Called "The Misery Strategy," it begins:

The path the country has set on since the defeat of immigration reform in the Senate in June enshrines enforcement and punishment above all else. It is narrow, shortsighted, disruptive and self-defeating. On top of that, it won’t work.

What it will do is unleash a flood of misery upon millions of illegal immigrants. For the ideologues who have pushed the nation into this position, that is more than enough reason to plunge ahead.

It then details a new program being rolled out this month whose goal is to make it much harder to employ undocumenteds.  What the editorial leaves out is a point made very clearly in a Times story yesterday - that these new efforts are creating a national climate of discrimination against all Hispanics, legal or not.  This new initiative will have the specific effect of discouraging the employment of legal Hispanics workers as employers will not want to take the risk of punishment if one of their "legal" workers turns out not to be so. 

A Sunday Times Magazine cover piece does a very good job describing how efforts to target undocumenteds can quickly become anti-Hispanic crusades.

Fixing our broken immigration system remains one of the most urgent governing challenges facing our political leaders today. Given this misery strategy described by the Times, it is also turning into one of the great moral challenges of our time, one that our leaders are simply not stepping up to meet.  It is time for our leaders, particularly the progressives, to do more than sit by and watch a new and virulent form of racism spread across our great nation.

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Tapping the Resources of America's Community Colleges: New paper and event in DC tomorrow

In a new paper released today by NDN Globalization Initiative Director, Dr. Robert J. Shapiro, we lay out a simple plan to provide tens of millions of American workers with essential IT training. Under this proposal, America's community colleges would receive federal grants to keep their computer labs open three nights a week, staffed by instructors who would provide basic - and free - IT and computer instruction to any person in the community who walks in and requests it.

The new paper, Tapping the Resources of America's Community Colleges, is the second in our Series of Modest Proposals to Build 21st Century Skills. The first paper, A Laptop in Every Backpack, called upon the federal government to equip every U.S. sixth grader with a laptop, so that students - the workforce of tomorrow - have the tools necessary to access the internet and build IT skills. Alec Ross, of the remarkable advocacy group, One Economy, and I co-wrote this paper.

Taken together, these papers urge the U.S. government to make a new national commitment to giving all American workers and students the skills needed to use modern information technology and navigate the emerging global communications network. Providing these skills is one component of a broader economic strategy advocated by NDN to ensure that globalization works for all Americans.

Please visit our website to read these papers and the accompanying introduction. For those of you in Washington, we invite you to attend our event tomorrow on IT Skills and Training for the 21st Century Economy. The event will be held in the Capitol, room H-122, from 10:30-11:45 (*please note the new room change). Additional event details may be found on our website.

Helping to make sure that all Americans benefit from the opportunities of today's economy is one of the greatest challenges facing American policymakers. For the last several years NDN's Globalization Initiative has been offering original and compelling thinking about how we can best meet this important challenge. I am proud of our work, and hope you will find this new paper, and its companion, helpful.

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NDN, Rob Shapiro in New York magazine on globalization

NDN Globalization Initiative Director Rob Shapiro is quoted prominently in a thoughtful John Heilemann column in New York Magazine this week.  An excerpt:

The pace of change being driven by globalization has only accelerated in the fourteen years since NAFTA’s passage. And the political backlash against that change has only grown more bellicose, potent, and mainstream. In 2006, a raft of Democratic Senate candidates—Ohio’s Sherrod Brown, Virginia’s Jim Webb, Montana’s Jon Tester—were elected in part because of their appeals to economic nationalism and their opposition to trade deals that reputedly sent countless jobs overseas. And the anti-globalization tenor of many House Democratic campaigns was even more pronounced. “In all my time in Washington,” says Rob Shapiro, chairman of the New Democrat Network Globalization Initiative and a key adviser to Bill Clinton’s 1992 campaign, “I’ve never seen less support for open trade across this town than today."......

More broadly, the consensus among top-tier economists that underpinned the support for free trade has lately been rattled by a spate of revisionism. Alan Blinder of Princeton, a former vice-chair of the Federal Reserve and a staunch Democrat, has taken to arguing that the downsides of unfettered globalization may be far greater than standard doctrine has assumed—in particular, that offshoring and outsourcing may put as many as 40 million American jobs at risk in the next two decades. The Nobel laureate Paul Samuelson has joined the chorus, as has former Clinton Treasury secretary Larry Summers, who wrote recently that pledges to retrain workers displaced in the globalized economy are “pretty thin gruel” when it comes to allaying the fears of the middle class.

The rethinking going on among such economists is salutary, to be sure. There can hardly be any doubt any longer that globalization (fueled by rapid technological change) is, as Shapiro has written, “weakening the long-standing connection between increases in the productivity of workers and the wages they earn.” But what makes the responses to this new reality among the Blinders and Summerses of the world welcome is that their arguments tend to be complex, careful, and nuanced. What none of them is advocating is any form of protectionism—even though that is precisely what many of the politicians and union leaders now seizing on the rethinking have in mind. Instead, the economists favor grand-scale education reform, worker training, R&D spending, and changes in the tax code to promote the creation of high value-added U.S. based jobs, and, not least, universal health care reform to bring down costs for domestic businesses.

“The next administration has a responsibility to create a new bargain on trade,” says Shapiro. “The bargain is, we will continue to expand open trade and we will make the significant investments required to enable American workers to benefit from it.”

Given Shapiro’s roots, it’s not surprising that his new bargain embodies the spirit of Clintonism (Bill Clintonism, that is). What’s often forgotten about Clintonomics, in its original incarnation, is that its theme was “putting people first.” Yes, there was always a commitment to fiscal discipline. Yes, there was the embrace of internationalism. But there was also a promise to sink massive sums into the formation and enhancement of human capital. But Clinton’s human-capital agenda was sacrificed on the altar of budget balancing, a sacrifice that was arguably unnecessary had the president and his people been willing to take on corporate welfare, congressional pork, and entitlement spending.

Now comes a golden opportunity for a presidential candidate prepared to do just that. Ready, that is, to make good on Bill Clinton’s unfinished agenda. Without question, the candidate most suitable to taking up the task, for reasons of both temperament and historical-cum-marital continuity, would be Hillary Clinton. Doing so would require her, however, to drop the cheap posturing as a trade hawk and adopt instead a stance of, I dunno, a genuine third-way leader. Those of us who care about getting globalization right will be watching and egging her on. And so, one hopes, will be her husband, who happens to understand all of this as well as anyone alive.

For more on NDN's Globalization Initiative, visit www.ndn.org.

Book Recommendation: The End of Poverty

Last summer I came along a book that had a truly profound impact on my understanding of the Middle East, Vali Nasr's excellent book, The Shia Revival.   As readers of this blog know I have aggressively promoted it, and you can even find an interview I conducted with Vali recently on our main site here. It is a true must-read for anyone seeking a better understanding of the Middle East today.

This summer I have come across another book that strongly recommend to friends and family - The End of Poverty by Jeffrey Sachs.  Few books I have ever read are as informed, as optimistic, as well-written, as important as this one.  Sachs lays out a powerful vision for how to eradicate extreme poverty in the world, and a pragmatic plan to get it done.  Like with Nasr, I hope we can get the Professor Sachs to address the NDN family some time in the not so distant future.

Immigration Hope?

The Times this morning has a story that suggests the immigration bill is still alive and kicking. Importantly it quotes the leading Senate R, John Kyl, admiting responsibility for the reckless actions of the anti-immigration deal gang of 4 who were instrumental in bringing the deal down last week.

On a relatied note, thoughtful Post columnist Sebastian Mallaby starts his column, "The Party of Global Seriousness" this way:

The collapse of the immigration bill last week holds a political lesson. It isn't just Democrats who flunk Globalization 101. Indeed, Democrats may be supplanting Republicans as the grown-ups on this issue.

Anyone who understands Globalization 101 knows that immigration, including large-scale unskilled immigration, is a fact of the modern world. Mexican laborers who migrate to the United States stand to see their wages triple or more: No amount of border security is going to keep them from coming. Chasing down and deporting illegal workers is costly to U.S. taxpayers, cruel to immigrants, disruptive for U.S. employers, expensive for U.S. consumers -- and, most of all, futile. People who yell "amnesty" merely reveal that they don't understand the world we live in.

But the Republican Party, which prides itself on understanding globalization when it comes to capital flows or trade, is blind to the global labor market. In the crunch immigration vote in the Senate on Thursday, only seven Republicans voted for reform, while 38 voted against it. Among the supposedly globo-phobic Democrats, the numbers were roughly reversed: 37 Democrats voted for reform while just 11 voted like ostriches...

Though I agree with the sentiment of the piece, I take issue that the current Republican leadership has ever demonstrated they have a firm grasp of globalization. It has been under the GOP's watch that we saw the selling out of IP at Doha in 2002; the passage of the distorting farm bill in 2002; the collapse of the Doha round these past several years; and of course they have been wildly ignorant of how the current wave of globalization has been effecting American workers. Their economic strategy these last 6 years has been limited to cutting taxes on the wealthiest among us, a response clearly not adequate to the moment we are in.

 

June 5th New America Foundation event worth checking out

The New America Foundation is hosting an event on June 5th entitled Inequality and Institutions: Understanding the Connections between Bargaining Power, Productivity, and Compensation in the U.S. Economy. It looks like it's going to be an interesting, timely event. For more information, click here.

Tough trade talks with China

Next week's US-China trade summit may be more acromonyous than Treasury Secretary Henry Paulson had hoped for, according to the WAPO:

On the eve of high-level economic talks in Washington next week, Chinese leaders are increasingly bitter about what they see as bullying behavior by the United States on trade issues, potentially complicating efforts to tackle disputes on such matters as technology exports and intellectual property.

In the span of three months this year, under the pressure of domestic politics, the United States moved aggressively against China for trade violations, filing two lawsuits and imposing steep tariffs on imports. The actions have so incensed China that Vice Premier Wu Yi, the leader of its delegation to next week's talks, apparently considered boycotting them.

On the surface, the Chinese are likely to play the role of grateful guests. Friday, in a slight concession to American arguments, they loosened controls on the value of their currency, the yuan. The Chinese are expected to bring with them $4.3 billion in high-technology contracts for American products.

But Treasury Secretary Henry M. Paulson Jr., Federal Reserve Chairman Ben S. Bernanke and the heads of nine Cabinet-level agencies are sure to encounter a more combative China when they sit down at the table this time. The Chinese are so mad there had been talk Wu might stay home to show "dissatisfaction and anger," said Xu Mingqi, an international economics professor at the Shanghai Academy of Social Sciences, a government-affiliated think tank.

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