NDN Blog

Carrie Budoff Brown of the Politico has a story up that shows that 20 of 37 Gubernatorial candidates both Democrat and Republican endorsed anti immigrant legislation.

The article Gov. candidates in 20 states endorse anti-immigration laws does an excellent job of contextualizing the larger problems associated with so many candidates endorsing these anti immigrant legislation:

Simon went on CNBC yesterday to discuss the Estate Tax, in part in response to former Treasury Secretary Robert Robin and investor Julian Robertson's op-ed in the Wall Street Journal calling on Congress to reinstate the estate tax.

I really have no idea where Kate Obenshain is getting her figures on the estate tax, especially the idea of it killing 1.4 million new jobs. Probably from the same reality as one that questions the idea that the economy is in a better place than it was 18 months ago.

Here's what the former Treasury Secretary has to say about the economic effects of the estate tax:

An estate tax can provide revenue—with little, if any, adverse supply-side economic impact—to fund deficit reduction, additional public investment or added assistance to those affected by the economic crisis. Used for public investment that has a rapid spend out, or applied to assistance for economically displaced citizens, the net effect will be to increase demand. That's because roughly 100% of the funds would be spent, while part of any large inheritance is highly likely to be used for savings or debt repayment. And either deficit reduction or public investment will better position our country for future economic success.

Way back in August, NDN came across a YouTube video that Phoenix-based KPHO News Station had produced which highlighted the connection between Jan Brewer, SB1070 and the private prison system in Arizona.

That post can be seen here

The story noted that while tourism and the state economy is taking a beating due to the curious habit of many of the states political elites constantly characterizing Arizona as a war zone to the national media, there is one business that still made tons of money off of SB1070: the private prison system.

The news story purported that many of Gov. Brewer's staff have connections to the private prison system, which granted state contracts and large amounts of money to detention centers that housed immigrants before they were deported.

This story has gone national, and is currently at Huffinton Post here.

The original news clip is below:

Arizona's Maricopa County Sherriff Joe Arpaio is legendary for his anti immigrant crack downs.

As this America's Voice backgrounder, The Notorious Record of Maricopa County, AZ’s Sheriff Joe Arpaio, makes clear he has gone above and beyond merely enforcing state immigration laws. Now the justice department has taken action.

From the Justice Departments Press Release:

WASHINGTON – The Justice Department filed a lawsuit today against the Maricopa County Sheriff’s Office (MCSO), Maricopa County, and Maricopa County Sheriff Joe Arpaio for refusing full cooperation with the department’s investigation of alleged national origin discrimination in violation of Title VI of the Civil Rights Act of 1964. 

Title VI prohibits discrimination in programs that receive federal funds, and also requires grant recipients to cooperate with investigations of discrimination by providing access to documents, facilities and staff.  MCSO signed contractual assurance agreements as a condition of receiving federal funds, and promised that it would cooperate with investigations of alleged discrimination.

The department filed today’s lawsuit after exhausting all cooperative measures to gain access to MCSO’s documents and facilities, as part of the department’s investigation of alleged discrimination in MCSO’s police practices and jail operations.  Since March 2009, the department has attempted to secure voluntary compliance with the department’s investigation.  MCSO’s refusal to cooperate with the investigation makes it an extreme outlier and the department is unaware of any other police department or sheriff’s office that has refused to cooperate in the last 30 years.

Sherriff Arpaio's lawsuit comes as some are beginning to question whether the cost of the states immigration crack downs are doing more harm than good.

David R. Francis of the Christian Science Monitor in his article Costs will rein in Arizona's immigration crackdown: Arizona can arrest illegal immigrants now, but then what? Prison and deportation are both too expensive to sustain notes:

Beside the moral, humanitarian, and legal issues surrounding illegal immigrants, their apprehension poses a sizable financial cost. In Arizona, police could arrest them under the new state law, but keeping them in already crowded jails costs roughly $100 a day per person. For 5,000 people, imprisonment costs could add up to $182.5 million a year. That's a hefty charge for a state struggling with a budget deficit of at least $368 million.

Presumably Arizona could save money by handing illegal immigrants over to the federal government for deportation. In fiscal 2008, the US deported 369,221 people. Deportations rose to 389,834 in 2009 under the Obama administration, and are predicted to reach 400,000 this fiscal year.

Julie Preston of the New York Times has written a piece on the drop in the number of illegal immigrants in the U.S.

The report entitled Number of Illegal Immigrants in the U.S. Drops, Study Says, cites a recent Pew Hispanic Report  U.S. Unauthorized Immigration Flows Are Down Sharply Since Mid-Decade:

The number of illegal immigrants in the United States, after peaking at 12 million in 2007, fell to about 11.1 million in 2009, the first clear decline in two decades....

The reduction came primarily from decreases among illegal immigrants from Latin American countries other than Mexico, the report found. The number of Mexicans living in the United States without legal immigration status did not change significantly from 2007 to 2009. Some seven million Mexicans make up about 60 percent of all illegal immigrants, still by far the largest national group, the Pew Center said.

However Preston notes that there is an even more important number cited in the report, the 11.1 million immigrants still in the country.

But the figure that may be most sobering to all sides in the increasingly contentious immigration debate is the estimate that more than 11 million illegal immigrants remain here. The Pew report shows that despite myriad pressures, there was no mass exodus of those immigrants to their home countries, especially not to Mexico.

This statistic indicates that despite all of the border security legislation, and all of the press coverage surrounding immigration, immigrants are not leaving.

As important as politicians think drafting legislation solely designed to secure borders, it is also equally important to figure out a way to bring those 11.1 million currently living out of the shadows.

I just posted a new essay on Huffington Post, "The Big Lie At the Core of the GOP's Economic Argument."

Check it out.  Would love your feedback.

Joel Kotkin, a presidential fellow at the urban futures at Chapman University, recently wrote an editorial for Forbes Magazine on a new 21st Century Business Model for the United States. This article focuses on the positive economic impact of immigrants in the United States.

The article notes:

In our globalized economy, the most enthusiastically touted approaches are those adopted by centralized, state-dominated economies such as China, Brazil and Russia as well as--somewhat less oppressively--those of the major E.U. states.

Yet the U.S. may well be constructing the best sustainable business model for the 21st Century. It is an approach built on the country's greatest enduring strength--an innovative business culture driven increasingly by a diverse pool of immigrants.

The article puts forth a narrative that highlights America's unique ability to take all manner of people and integrate them into a cohesive business model, while also showing that the complexion of the American Business model is changing:

If the U.S. wants to retain pre-eminence, it needs to go with what makes it a great country: its protean national and increasingly post-racial business culture.

This evolution is increasingly evident at the very top of our economy

1. Between 1990 and 2005 immigrants started one quarter of all venture-backed public companies.

2. Large American firms are also increasingly led by people with roots in foreign countries Including 14 of the CEOs of the 2007 Fortune 100. 

3. Even the top tier of corporate America--once the almost-exclusive reserve of native-born Anglo-Saxon--increasingly reflects the diversification of the larger society.

The financial benefit to the country is significant:

Already, for example, eight Indian American CEOs run U.S. corporations with over $2 billion in sales, including companies like Citicorp, Adobe Systems and Pepsico. Pepsi's historic rival, Coca Cola, is now run by Muhtar Kent, a native of Turkey. Foreign CEOs also include Kellogg's Australian-born David Mackay and Ethan Allen's M. Farooq Kathwari, yet another native of India.

It is important to note that this is not just a high skilled immigrant phenomena:

Immigrant commerce also thrives at the grassroots level. It manifests most visibly in the proliferation of small stores, restaurants, food-processing businesses, garment factories and trucking lines.

Overall, immigrants are 60% more likely to start a new business than native-born Americans. The number of self-employed immigrants has grown even in New York City, where the number of self-employed among the native-born has dropped.

Immigrant businesses have thrived by providing basic services, such as banks, insurance agents, funeral homes and grocery stores. Some of these businesses arose because the mainstream community had failed to identify opportunities in these markets or had consciously decided to exclude them.

This trend will only continue in the future:

One critical harbinger can be seen in the current crop of students at top U.S. business schools. Between one-third and one-half all students at Stanford, MIT, University of Pennsylvania, University of Chicago and UC Berkeley come from abroad. These schools are training camps for immigrants transitioning into careers as American entrepreneurs.

The article also does a great job of placing the current influx of immigrants in a more historical context by looking at the effect of earlier ethnic groups positive impact on the American economy.

This is a great read and one that focuses on the broader immigration economic picture, which is that in an increasingly globalized economy having a diverse population is a net positive.

A fully-sourced pdf of this analysis can be found here.

Last week, NDN issued a fiscal analysis of the five point economic plan outlined by House Minority Leader John Boehner in a speech in Cleveland, Ohio. Since that time, clarifications regarding his spending plans and a new CBO analysis have made providing an update worthwhile. The following brief analysis examines the impact of John Boehner’s stated plans on the federal budget deficit and the national debt over the next ten years.  

The Fiscal Impact of the Boehner Plan

1. Fully Extend the Bush Tax Cuts.

Increase deficits and debt by $3.8 trillion over ten years. 

2. Have the president veto the Employee Free Choice Act, a carbon tax or cap and trade, and “any other tax increases on families and small businesses” if passed during a lame-duck session of Congress.

Unable to assess impact of hypotheticals, but the provision impairs ability to address deficits and debt, including the potential loss of $624 billion in revenue over ten years from a carbon regime. 

3. Health Care Agenda: Repeal the entire Patient Protection and Affordable Care Act/Repeal the provision in healthcare reform mandating that small businesses file IRS 1099 forms on purchases of over $600.

In his Cleveland speech, Boehner called for the repeal of what some call the “1099 mandate” as included in the Patient Protection and Affordable Care Act in order to close the business tax gap. This would increase the deficits and debt by $17 billion over ten years per Congressional Budget Office estimate.  However, since our last analysis, the Congressional Budget Office has released an analysis of the costs of repealing the entire Patient Protection and Affordable Care Act. Boehner has previously referred to repealing this legislation as his “No. 1 priority.” Doing so would add $455 billion to the deficit over the next ten years. 

4. Reduce non-defense discretionary spending to 2008 levels.

In 2008, non-defense discretionary spending was approximately $522 billion.  Boehner’s office has stated it wants a “hard cap” on such spending and claims a total of $340 billion in savings over ten years, but does not document such savings. Our analysis reveals that, against current policy such a hard cap would actually yield a savings of $67 billion over ten years. Most of these savings come at the end of the decade. Against the President’s budget, which includes a three year freeze on non-security discretionary spending, savings are negligible. 

5. Resignations of the President’s economic team, starting with Secretary of the Treasury Geithner and National Economic Council Director Larry Summers.

The position of NEC Director is not Senate confirmed, so it is fair to estimate that it would take the Administration two weeks to fill that position. Estimating for the taxes paid on his $172,000 annual salary , two weeks without an NEC Director would save the Federal government between $5000 and $6000.

Treasury Secretary Timothy Geithner makes an annual salary of $191,300.  Because he is Senate confirmed, it is safe to estimate that it will take two months for his confirmation. Therefore, two months without a Treasury Secretary would likely save the Federal government between $25,000 and $26,000. Therefore, these resignations amount to a fiscal impact of $30,000 - $32,000 of deficit reduction over the next two months.

Total Fiscal Impact of the Boehner Plan: Increase Deficits and Debt by roughly $4.188 trillion over ten years.

Related Posts:

Boehner Plan Raises All Sorts of Questions About GOP's Economic Arguments by Simon Rosenberg, 8/25/10

I'm excited to announce the addition of four new high-caliber members of our already very able NDN/NPI team.  Look forward to our community getting to know them as I do in the months ahead.   Here they are:

Clare Giesen - Director, Electricity 2.0 Initiative

Clare Giesen will direct and coordinate our Electricity 2.0 initiative. Clare brings a wealth of high-level energy experience to her new role at NDN. She served as White House Liaison for the Department of Energy during the Clinton Administration and worked on electricity re-structuring and the deployment of renewable energy technologies. As senior advisor at the USDA Rural Utilities Service, she initiated and developed their first renewable energy loan program for the rural electric cooperatives. A native Texan, she served as Chief of Staff to Congressman Mike Andrews. Most recently she was Executive Director of the National Women's Political Caucus.

Ana Maria Vidal - Program Associate,  Latin America Policy Initiative

A native Caribbean, Ana Maria joins us as Program Associate for NDN's Latin America Policy Initiative.  After graduating from Tufts University with a degree in International Relations, she served as a Deputy Advisor to the Governor of Puerto Rico, focusing her work on education and economic development. Her exposure to higher education partnerships in Mexico as well as her experience as a citizenship teacher for Salvadorian Refugees in Massachusetts have led her to a keen interest in US-Latin America relations. Before coming to NDN, Ana worked at an international development consulting firm in DC, providing support for projects all over the world, and is currently pursuing to a master's degree in Government at Johns Hopkins University.

Morley Winograd - Special Advisor, Global Mobile Technology Initiative

Morley Winograd, a fellow with NDN since 2009, will be expanding his role at NDN as a Special Advisor to the Global Mobile Technology Initiative. Morley spent eighteen years in the telecom industry in a variety of sales and marketing positions with AT&T and became the Executive Director of USC's Marshall School of Business's Institute for Communication Technology Management (CTM) in 2001. Morley is also the co-author of two technology related books: Taking Control: Politics in the Information Age (with Dudley Buffa in 1996) and Millennial Makeover: MySpace, YouTube and the Future of American Politics (with NDN fellow Mike Hais in 2008). He and Mike are working on their next book scheduled for publication in the fall of 2011.

Samhir Vasdev - Policy Associate, Global Mobile Technology Initiative

Samhir Vasdev, a summer associate with the Global Mobile Technology Initiative, will stay on as a Policy Associate and contributor to the Global Mobile blog. Samhir  is completing his final year at Georgetown University, majoring in political science. He's interested in the way 21st-century technologies intersect with politics, governance, citizenship, and development, particularly in developing countries in Africa. He's thrilled to have the opportunity to continue exploring this powerful space with NDN and the New Policy Institute.

A common refrain from anti-immigration organizations is that immigrants weaken the wages of American workers and do damage to the economy. 

According to the Federal Reserve Bank of San Francisco, on a state level the opposite is true:

Immigration actually boost wages and increase productivity overall for states that have large populations of immigrant workers.

The report written by Giovanni Peri, entitled The Effects of Immigrants on U.S. Employment and Productivity examined the following:

The effects of immigration on the total output and income of the U.S. economy can be studied by comparing output per worker and employment in states that have had large immigrant inflows with data from states that have few new foreign-born workers.

Statistical analysis of state-level data shows that immigrants expand the economy's productive capacity by stimulating investment and promoting specialization.

The paper also examined the short and long term effect of immigration on the economy:

Immigration effects on employment, income, and productivity vary by occupation, job, and industry. Nonetheless, it is possible to total these effects to get an aggregate economic impact.

Here we attempt to quantify the aggregate gains and losses for the U.S. economy from immigration.

If the average impact on employment and income per worker is positive, this implies an aggregate “surplus” from immigration.

In other words, the total gains accruing to some U.S.-born workers are larger than the total losses suffered by others.

A lot of great information here, highly reccomend reading from start to finish. The economic data presented here helps to contextualize the current debate over immigrants and wages.