the economy

The Debate on the American Economy

With the general election less than six months away, we are about to be inundated with ads and speeches from Democrats and Republicans trying to convince us to vote for them. As 13 million Americans continue to look for jobs and our public debt expands indefinitely, voters will be looking for a candidate who they think can provide strong economic leadership. Winning the economic debate, therefore, is crucial to winning the election.

Both sides offer very different narratives on how to get the economy back on track  In this series, which will run throughout the summer, I will document how the economic debate plays out in the political sphere. Looking mainly at campaign advertisements and stump speeches, I report on how the Obama and Romney camps frame their economic arguments and what kinds of solutions they are advancing for America’s economic woes. I welcome any feedback from readers who find interesting local ads pertaining to the economy.

To start things off, here’s a video of former president Bill Clinton stumping for President Obama in New York last night. The full transcript of the speech can be found here.

A couple of interesting points:

Clinton highlights the creation of 4.3 million private sector jobs under President Obama. This seems to refute Republican attacks on Obama’s jobs record.

Clinton equates Republican and European austerity policies, effectively establishing a link between the Republican party's economic philosophy and policies that have contributed to Europe's instability 

Be sure to check back regularly for updates on the debate over the American economy. 

 

 

Weekly Immigration Update: Immigrants are Vital to Economic Recovery

A new study published by the CATO Institute has findings on immigrant productivity and concluded that the focus on repelling immigrants does more harm than good to the U.S. economy; the report was covered by the Wall Street Journal and by Walter Ewing, published in the Philadelphia Inquirer.  According to WSJ:

"Increased enforcement and reduced low-skilled immigration have a significant negative impact on the income of U.S. households," write Peter Dixon and Maureen Rimmer, the study's authors. "In contrast, legalization of low-skilled immigrant workers would yield significant income gains for American workers and households...a program that allowed more low-skilled foreigners to enter the U.S. workforce lawfully would put smugglers and document-forgers out of business," explain the authors. "It would also allow immigrants to have higher productivity and create more openings for Americans in higher-skilled occupations."

Using a dynamic economic model that weighs the impact of immigrants on government revenues and expenditures, the study seeks to quantify the benefits of comprehensive immigration reform versus the enforcement-only approach. It finds that legalizing the entry of more low-skilled immigrants would result in economic gains of about $180 billion annually to U.S. households. A focus on more enforcement alone would not only result in an annual net economic loss of around $80 billion, say the authors, but fewer jobs, less investment and lower levels of consumption as well. "Modest savings in public expenditures would be more than offset by losses in economic output," says the report. 

In other news, the Asian-American Community flexed more muscle this week in the fight for immigration reform, covered by various news outlets. 

More Advertisers Drop Glenn Beck - More companies came out this week opting out of being associated with his xenophobic dinner theatre.  Hopefully the next step is: Glenn Beck off air.  Join in to "Stop the Race Baiting." Next - we Drop Dobbs and Limbaugh. 

Other headlines this week:

Immigration Reform is NOT Health Care Reform

White House Reiterates Commitment to Fixing the Broken Immigration System - let's keep on it!

White House Meeting on Immigration/NDN Backgrounder on Immigration Reform

Jorge Ramos: La Promesa

Only Three Fifths of a Person - More Deaths in DHS Detention

The Real Economics of Immigration Reform

After President Obama's discourse today on how to help working Americans through this crisis, I thought it appropriate to reiterate points we have made on the economic arguments for immigration reform.  And I highly recommend this piece in the American Prospect on "The Real Economics of Immigration," by Cristina Jimenez:

...Immigration reform is a tougher sell in a recession. That's the blunt observation Wall Street Journal
columnist Gerald Seib recently offered: "Pushing any kind of
immigration reform, particularly one that includes a path toward
legalization, is a lot harder in an environment in which Americans are
losing jobs."

Yet the political difficulty predates the Wall Street collapse and
job-loss figures. For years, there has been little analysis of how a
path toward legalization would increase the positive economic
contributions of undocumented immigrants. Instead, conservative critics
have found willing partners in the media and government to turn
immigration reform into a zero-sum game, a war of us-versus-them in
which every job performed by an "illegal" must have been stolen from a
more deserving American.

The politics won't change until the real economics of immigration reframe the debate.

Here's a reality check: Consigning undocumented workers to a
precarious existence undermines all who aspire to a middle-class
standard of living........
By complying with tax law, many immigrants have made it clear that they
are willing to help build a new middle class through cooperation.
Contra the myth of immigrants as economic parasites, tax dollars from
undocumented immigrants are an integral part of our national economy,
funding programs like unemployment benefits that support a large number
of Americans in a time of economic crisis. This money is more
indispensable than ever. The Internal Revenue Service estimates that
undocumented immigrants contributed nearly $50 billion in federal taxes
between 1996 and 2003. Ironically, it's easy for undocumented
immigrants to document their earnings; a passport and proof of address
are all they need for a tax-identification number.....

The Small Business Administration finds that immigrants are nearly 30
percent more likely to start a business than non-immigrants and that
they represent 16.7 percent of all new business owners. In New York
City, the borough of Queens -- the most diverse county in the nation --
remains the leading source of job creation in the city. According to
the Center for an Urban Future, three zip codes in Queens had
employment growth of more than 80 percent in the past decade, adding
66,000 immigrants from 2000 to 2005....

Nancy and Carlos live with the constant threat of deportation,
surviving between hope and trepidation as best they can. "We need to
hide like criminals, and we go to work in fear, hoping that God brings
us back home. You know, we will do any work to survive," Nancy
insisted. Some jobs that paid $10 an hour just a few months ago now pay
only $4 an hour.

Yet Carlos sounded unfazed by the recession. "We have our savings;
the difficult times have taught us that we need to save for
emergencies," he told me. "We pay our taxes; our son makes online
monthly payments to the IRS because we get paid cash."

A path to legalization for millions of people like Carlos and Nancy
is a cost-effective path to short-term stimulus and long-term recovery.
We cannot afford to ignore it any longer.

Hispanics and Immigration Reform Must be Part of the Economic Agenda

Reports from the Pew Hispanic Center and others, released at the end of 2008, show disturbing data on the impact of the economic crisis on minorities, and I hope Tim Geithner is up to speed on this information and keeps minorities in mind as he helps map the course for economic recovery.  We hope Geithner's confirmation hearings over the next few days will pass to a speedy confirmation so that he can get to the business of governing "for all Americans," along with President Obama.

Data show that minority workers have fewer employment opportunities, lower wages, or both as compared to their white counterparts. As a result, they tend to have lower incomes and slower income growth.  And because minorities are less well suited than white families to save and build an economic cushion, hard economic times place them in tougher conditions sooner than is the case for white families.

Hispanics are currently suffering a percent of unemployment much higher than that of their white counterparts, 9.2% in January, up from 8.9% unemployment in December 2008.  In addition, the unemployment rate for Hispanics rose faster than for any other group, increasing by 3.1% from December of 2007-December of 2008, while the unemployment rate for whites rose by 2.1% and for blacks, 2.9%.

Even during a period of employment gains enjoyed by Hispanics from 2001-2007, poverty increased among Hispanics over the same period, which only highlights the low wages at which Hispanics tend to work. In 2007, 8.2 percent of whites lived below the poverty line, up from 5.4 percent in 2000, but well below the 21.5 percent of Hispanics who lived below the poverty line in 2007.

Lastly, personal and family income has steadily declined for Hispanics.  From 2001-2007, family incomes for whites were about 30 percent greater than for Hispanics and that gap has increased over time.  Hispanics' median family income declined by an average of 0.5 percent per year from 2000, the last full year before the last recession started, to 2007, the last year for which data are available, falling to $38,679 from $39,935, or by a total of $1,256 (in 2007 dollars). In comparison, whites' median family income fell at a much lower rate of just 0.003 percent per year, for a total decline of $12 between 2000 and 2007, to $54,920 from $54,932 (in 2007 dollars).

Large disparities in health insurance coverage also persist.  In 2007, 32.1% of Hispanics lacked health insurance coverage, compared to 10.4% of whites.

Additionally, Hispanic home ownership rate was only 49.7% for Hispanics in 2007, compared to 75.2% for whites.  While the annual average increase of homeownership was greater among Hispanics, many were also victims of bad-actor lending companies and they ended up purchasing high-cost mortgages, as opposed to market rate mortgages.  Nearly 29% of home purchase loans made to Hispanics in 2007 were high cost, as opposed to only 11% for whites.

We encourage Secretary Geithner and President Obama to show courage and leadership in developing an economic stimulus and economic recovery that addresses these discrepancies and includes financial literacy for minorities.  In addition, we encourage President Obama to take the lead on fixing our broken immigration system in order to help stem this economic crisis.  As long as the trap door of undocumented immigration remains, we will not be able to achieve economic recovery.  It is vital that Congress and the Administration realize that as long as we continue the race to the bottom fostered by our broken immigration system, we will not achieve economic recovery.

A Race To the Bottom - A Broken Immigration System Has a Social Cost, Too

According to a report just released by the Migration Policy institute, although the U.S. economy's nosedive has probably contributed to a drop in the number of undocumented immigrants coming into the United States, those already here will be less inclined to return home due to the manifestation of the economic crisis in the U.S. and abroad. The study does not focus on how border enforcement has deterred immigrants from returning home. 

In a great piece in the Post today by N.C. Aizenman, co-author, Demetrios G. Papademetriou explains,"The immigration system of the United States makes people wait in line for years to get their visa...so, by the time it becomes available for a family member or a valued employee...They don't want to return to the back of the line." The current broken immigration system exacerbates the economic crisis because -as explained in the report - the more likely and worrisome potential effect of the recession on undocumented immigrants is that it will drive them to accept ever-lower-paying jobs under ever-worsening conditions.  This is why it's so imperative that our legislators realize that immigration reform can be a tool to help fix the economy - the economy and immigration are inextricably linked, I hope Members realize they must stop seeing these two issues as separate and unrelated.  For those who argue, "how are we going to pass immigration during an economic crisis? How are we going to let in those immigrants?" I say: you think we have an unemployment NOW?...I refer you to the report's author: 

"We have to be careful about what people desperate for a job may do," Papademetriou said. "This begins to affect the labor standards and wages of not just the immigrants, but the people who work with them". This has very important social and economic consequences for the country. . . . If we're not careful, we could have situations that are unanticipated and that we haven't seen in this country for a while."

Abroad, the International Monetary Fund estimates that economic growth in Mexico will decline from 4.9% in 2006 to 1.8% in 2009 - we've already started to see the dramatic devaluation of the peso - which further reduces the incentive of undocumented immigrants to return home.  Let's pass comprehensive immigration reform and stem this race to the bottom.

Weekly Immigration Update - Outlook for Immigration in 2009

On yesterday's Meet the Press, Senate Majority Leader Harry Reid discusses hopeful prospects for immigration reform in 2009:

MR. GREGORY: Let me ask you about politics.  This is what you told Roll Call two days after the election of Barack Obama.... "‘I think the country has moved to the center,'... ‘I think people want us to get things done.'" Let me test that proposition.  On immigration, do you have a deal between the president-elect and Senator McCain for immigration reform?...

...SEN. REID: "We need comprehensive immigration reform." That was a conversation I had with John McCain.  Yes, we need comprehensive immigration reform.  And what does that mean?  It means we have to make sure our borders are protected, our northern and southern borders.  We have to do something about the millions of people here who are undocumented.  We have to put them on, on a pathway to legalization.  Does that mean that they get to the head of the line?  Of course not.  They'd have penalties and fines and learn English and stay out of trouble.  We have to also do something on a guest worker program and we have to do something about the employer sanctions that works. John McCain believes that should happen.  I believe that should happen. That's...

MR. GREGORY: And he's discussed it with the president-elect?...

MR. GREGORY: McCain has?

SEN. REID: I don't know, but he's discussed it with me.

MR. GREGORY: Mm-hmm.  You think you've got a deal, a prospect of a deal.

SEN. REID: I have, I have John McCain's word that he's going to work real, real hard on immigration reform....

...SEN. REID: And I'll, and I'll work with him.

Gov. Bill Richardson Withdraws From Consideration as Commerce Secretary - This news is not only unfortunate for the President-elect and his team and for the country as a whole, it is bad news for immigration reform.  This Governor's support of reform and criticism of half-measures (such as "enforcement-only"), his legislative, executive, and international experience made him particularly qualified to put a great deal of weight behind comprehensive immigration reform (CIR) legislation in a time of economic crisis as Secretary of Commerce.  Luckily, we still have strong champions for CIR in the administration with Gov. Napolitano as DHS Secretary and Rep. Hilda Solis as Secretary of Labor.  The confluence of immigrants and labor is exactly what the current administration has not been able to get right.  What Ms. Solis and the President-elect seem to understand is that by upholding workers' rights, even for the undocumented, you uphold wage and labor rights for all working Americans.  It is indespensable that Barack Obama name a new nominee for Secretary of Commerce that posseses the same passion and ability of Gov. Richardson to strengthen coalitions in favor of CIR in order to pass CIR in 2009.

An article in The Hill comments on what will likely be early tests on immigration for Barack Obama upon assuming the Presidency, and Spanish-language media demonstrates that the Hispanic community has not forgotten Obama's commitments in this area.  Univision's Sunday morning program, Al Punto, aired an "end of the year" summary that featured five stories - four of the five had an immigration focus.  Next to job creation, immigration reform is the top issue on the minds of Latinos for 2009.  The analysts on Al Punto highlighted that as the economy improves, there will be a need to address the economic demand for workers so that businesses can meet their needs legally, and to ensure labor and wage standards for all workers.

The Hispanic community won't forget the promise of immigration reform - This Sunday, Al Punto had a feature on immigration reform in 2009 and re-played an interview with Barack Obama from May 28, 2008.  When asked whether he was committed to passing immigration reform "in his first year," he replied, "yes, in my first year."  Frank Sharry appeared on this segment commenting on the current climate of fear among immigrant communities.  

President-elect Obama on Raids - During the same interview that took place in May and was replayed this Sunday, Obama was asked how he would handle raids.  He responded that he considered raids a "good public relations move," to make it seem like the government is doing something, but they don't solve the problem in the long-term.  He recognized the terror that affects communities as something to be given due consideration, "I don't think it is the American way to capture a mother and separate her from her child," and not think of the consequences.  Clearly raids are a part of the general review the President-elect will undertake.  Rather than demand or expect him to issue an order "halting raids," I think we can expect Obama to shift the focus of enforcement to going after unscrupulous employers, criminal aliens, and human traffickers.

How to convince Barack Obama that reform is needed this year?
- This question was posed on the Sunday morning Spanish-language showI would posit that the bigger question is how to make sure we educate legislators in both chambers on this issue.  The bottom line is that American voters voted for Obama and for a large number of Democratic legislators as a repudiation of the inaction of the past eight years.  CIR provides the opportunity to demonstrate a will to govern, to take action and solve problems - particularly at a time of economic crisis.  The economy and immigration go hand in hand.  Immigration is a national security issue, it is an economic issue with economic roots and consequences.  By ignoring the undocumented and those who are wanted as workers, you encourage the exploitation that erodes working conditions and job security everywhere.  In a time of economic crisis, the stability and dignity of the work force are especially vital.  This is also why CIR must not be limited to addressing the legalization of the undocumented - CIR must address issues of future flow and it must revamp the entire visa system.  The existing visa system is outdated, unfair, and clearly unrealistic given that most of the undocumented came into the country legally and overstayed their visas.  With the amount of work immigration reform will take, it is vital that it is truly "comprehensive." 

Re: A long road back for the GOP - An interesting article in the CQ, "The Republican Search for Self Better Find Something Quickly," echoes what NDN has been writing about in Simon's post on their "long road back" and my post on how the current GOP is so out of touch - intentionally or not - with 21st century America.  John Bicknell writes: "Republicans are going to have to figure out who they are, and how that identity is relevant to modern America. And they are going to have to do it in less than two years. Otherwise, they could well find themselves on their way to another 40 years in the wilderness." For Democrats, CIR represents a great deal of opportunities to prove their ability to govern, and for Republicans, passing CIR can be the first step out of the wilderness.  

More Examples of our Broken Immigration System:  All of which exacerbate undocumented migration - 1) Marriage Fraud - CQ covers a CIS study as part of a larger piece on marriage fraud and immigration.  While CIS is a known hate group as identified by the Southern Poverty Law Center, and even though we have no factual basis with which to accept their data, even one fraudulent marriage is one too many, and it demonstrates the insufficient legal means for immigration in our laws.  

"The real problem with marriage and immigration law and policy is how the government disrespects the marriages of U.S. citizens and legal immigrants who obey the rules," Paul Donnelly, spokesman for American Families United, which works to reunite Americans' foreign spouses and children, said in an interview....Legal permanent residents have to wait almost five years - nearly eight years for Mexicans - to bring a foreign-born spouse or child into the United States. Americans who marry foreigners that have overstayed prior visas or have been discovered in the country illegally cannot bring that spouse or child into the country for at least three years, with a maximum 10-year term of inadmissibility if the visa overstay is greater than one year or the foreigner is deported.

2) Immigrants priced out of legal status - Only about half of all Central American immigrants eligible for a renewal of their temporary protected status actually filed for their renewals.  Many of these immigrants could not afford the filing fees due to having been laid off or having their number of work hours cut in this time of economic recession.  

3) The Face of Slavery - As long as there are insufficient legal channels for immigrants to come into the country, and as long as those existing channels remain slow and bureaucratic, we will continue to see crimes against humanity like those shown in this New York Times feature - examples of human trafficking and slavery into which women and children fall as they try to achieve the American dream.

The State of Courts - Chief Justice Roberts provided his annual report on the state of the federal courts, which showed bankruptcy filings rose by 30%, filings concerning criminal charges in immigration cases jumped by 27% (the cases are concentrated in the Southwest).  "Criminal charges" could mean criminal activity, or they could mean cases like the one that occurred in Iowa, where many undocumenteds with no IDs or social security numbers unkowingly signed guilty pleas for identity theft.  In the meantime, prosecution of sex offense cases grew by only 9%, and the number of drug cases actually dropped by 7%.  Chief Justice Roberts explained, "Those reductions occurred when investigative agencies shifted their focus from drugs to terrorism and sex offenses." 

Hate Crimes - Two Hispanic youths assaulted a 28 year-old Hispanic woman in San Francisco.  The woman is a lesbian who lived with her partner near the boys, the crime has been qualified as a hate crime.  This horrific crime is made more appalling by the fact that it occurs at a time when Hispanics are crying out in protest against the hate crimes that resulted in the murders of several Latino immigrants and as communities are fighting for their right to be free of fear of having hate crimes perpetrated.  How can we demand certain behavior of other communities if we don't begin with our own? 

Speaking of Border Security - A couple, their children, and family of 7 were killed en route from Dallas, TX to Mexico.  As they were about to cross the border in Texas, they drove on a bridge half of which had collapsed during rain storms.  There were no road blocks, not a single sign warning of the end of the bridge, so as the family drove during the night they fell over the edge of the bridge into a river, only one grandmother survived.

Al Franken to the Senate - It is expected that Al Franken will be declared the winner today in his race against Norm Coleman.  This is good news for immigration reform, click here to see Sen.-elect Franken's position on CIR. UPDATE:  Franken declared winner.   

Unemployment Rate of Latinos Skyrockets

In September, the Pew Hispanic Center's report on the overall state of Latinos found that Latinos were in a significantly worse economic condition and reported a decline in their general well-being. We have continued to see how the economic crisis is hitting Latinos particularly harshly, and today we find that the unemployment rate for Latinos has sky-rocketed to 8.8% in October. The overall national unemployment rate for October reported today is 6.5%, with 240,000 jobs cut during the month. Hispanics have been particularly affected, as the number of unemployed Hispanics went up in September to 1.72 million, and in October Hispanics comprised 1.96 million of the 10 million people unemployed nationally.

Economic Stimulus? - Reid and Byrd Unveil Economic Plan

Here's the proposed Economic Recovery Package. The overall intent to "not forget Main Street" and "create good-paying American jobs" is a noble one, I question whether this package achieves such a goal. There is a great deal of progress in the area of Energy, allocating funding for key energy initiatives of which NDN has been an advocate (see NDN's Green Project blog). However, there is no mention of International Trade or initiatives to export new technology; the section on job creation mentions infrastructure, which is an important step forward, but no mention of how to use globalization to create more high skilled, better paying jobs. I would ask why the section designed to help small businesses - by all accounts the "job creators and drivers of the economy" - only allots $275 million for microfinance and other assistance to "Main Street," while it provides $776 million for border facility construction and "other homeland security infrastructure." I hope our taxpayer dollars don't continue to go towards a border fence that has not worked instead of small and medium-sized businesses that sustain our communities. The stimulus includes $466 million for DHS to begin construction of a consolidated headquarters in Washington, D.C., as "DHS has a critical need for a permanent, unified headquarters" - maybe having everyone under one roof will help reduce the backlog in naturalization and immigration applications! THAT must have been the hold-up all this time. While the $466 million are being allocated for offices, only $100 million is going to help communities along the southwest border fight the illegal flow of guns and drugs between the U.S. and Mexico that is fueling violence along the border. Call me crazy, but I think the offices can wait in line behind the safety of border patrol and citizens on both sides of the border. The conflict on the border similarly contributes to the economic downturn in that the violence has effectively killed business and tourism that previously made border cities job creators and places that flourished with commerce and (legal) economic activity.

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