August 2013

One reason to favour a more open and liberal migration regime is because of the gains in economic efficiency and prosperity it would bring, because of the benefits brought by younger and more active workers who pay more in taxes than they take in benefits, and so on. But when people voice this argument, there’s one response that is almost instantly trotted out. This is to say that, even if it true that a more open regime is better in the aggregate, it isn’t better for the least advantaged among the indigenous population because labour market competition from the incomers depresses wages and often leaves low-skilled native workers out of a job. Now conceding, if strictly for the sake of argument, that there might be other reasons to restrict immigration (cultural impacts on the native poor, whatever …) and focusing on the economic argument alone, I can’t see that this objection makes much sense. If there’s something that is good in the aggregate, but has bad distributive consequences, the solution is surely to use the tax-and-transfer system to fix those distributive outcomes. You could either do this directly (maybe, for example, taxing the surplus to fund a citizen’s or basic income) or indirectly, by funding better education or training. But it doesn’t seem to make much sense for forego the aggregate benefit.

Now an objection to this might be that, given a lack of confidence that political leaders will actually introduce such redistributive measures (rather than, say, letting aggregate gains flow to the one per cent), it is rational for indigenous workers and their political representatives to lobby for tighter labour protectionism via immigration controls. But given the obvious downsides to that second-best strategy, particularly in its divisiveness and its fostering of xenophobia and racism, it seems clear that the left should prefer to take the aggregate benefits and redistribute them. Certainly it seems as if the left should be making such an argument rather than just pandering to “anxieties” among their traditional constituencies as the likes of “Blue Labour” tend to do.

Two questions occur to me. First, am I right about the “in principle” economics of this? Second, are there respectable political counterarguments, even if I am right about the economics?

[Note that this post is not about the right of the state to restrict migration, a matter on which I’m far more sceptical than most people. It concedes that right for the sake of argument and focuses on what the best policy should be.]

Via “Michael Froomkin”:http://www.discourse.net/2013/08/democracy-in-action-missouri-edition/, this “Pro Publica piece”:https://www.propublica.org/article/how-high-cost-lenders-fight-to-stay-legal is well worth reading.

bq. As the Rev. Susan McCann stood outside a public library in Springfield, Mo., last year, she did her best to persuade passers-by to sign an initiative to ban high-cost payday loans. But it was difficult to keep her composure, she remembers. A man was shouting in her face. He and several others had been paid to try to prevent people from signing. “Every time I tried to speak to somebody,” she recalls, “they would scream, ‘Liar! Liar! Liar! Don’t listen to her!’” Such confrontations, repeated across the state, exposed something that rarely comes into view so vividly: the high-cost lending industry’s ferocious effort to stay legal and stay in business.

In the controversy over who should replace Ben Bernanke as Chairman of the US Fed, a fair bit is being made of the fact that Larry Summers is (to put it politely) a jerk. Without denying this, I’d like point out that, when it really mattered, Summers was thoroughly outjerked by the genuine article, Rahm Emanuel.

The occasion was the decision on a stimulus package needed immediately after Obama’s inauguration. Emanuel’s brilliant strategy was to go for as small a stimulus as possible, declare victory on the economic front, then turn to the main game of cutting a deal with the Republicans on health care reform. We all know how that turned out, [^1] and anyone who recalled the Great Depression could easily have foreseen it. I can recall how stunned I was that Obama failed to take the obvious opportunity to nail Bush and the Repubs for the crisis, and switch to a single-minded focus on economic recovery.

The Keynesian analysis done inside the White House by Christina Romer and outside by Paul Krugman showed that what was needed was a stimulus of at least $1.7 trillion. Based on his subsequent commentary, it’s clear the Summers understood and agreed with this. If he had lived up to his reputation, Summers would have pushed this through the White House by demonstrating, beyond any doubt, that Emanuel was the kind of fool he is famed for not suffering gladly. Instead, he first made Romer reduce the estimate to $1.2 trillion, then dropped it from his brief without telling her, giving Obama a range from $600 billion to $800 billion.

Summers is great at saying the unsayable when it comes to things like shipping toxic waste to poor countries or making baseless speculations about genetics and gender. But when it really mattered, he couldn’t come up to scratch.

Note: Out of laziness, I omitted the link to the piece by Noam Scheiber, on which I relied. I’ve added it now.

[^1]: Fans of 11-dimensional chess might want to make the case that Obama deliberately threw the 2010 election to the Tea Party, foreseeing that the resulting hubris would drive the Repubs mad, and therefore lead to their ultimate destruction. But I can’t impute such subtlety to Emanuel.

At a time when the debate on immigration in the US seems to be going in a more liberal direction, things in the UK have become far far worse. One manifestation of this was a co-ordinated series of over 200 raids yesterday by the UK Home Office, which detained more than 100 people suspected of immigration and visa offences. Many of the raids took place in and around tube and rail stations in areas of London with high non-white populations and, according to eyewitnesses, involved the selection and harassment for “papers! papers!” of people who – at least in the view of the enforcement heavies – looked foreign. This is certainly an abuse of power by the Home Office: expect claims for compensation from racially-profiled British people and other legal challenges shortly. Needless to say, random harassment of non-white people also threatens a serious deterioration in race relations in some parts of London. The raids come immediately after a campaign involving a large truck driven around those same areas of London with the the offensive suggestion that people of irregular status should “go home”. Though this campaign is pitched as enforcement against people who don’t have the right to be in the UK, very very many of those with irregular status are in limbo not through any fault of their own, but because the Home Office (and formerly the UK Border Agency) has failed to process applications in a timely manner, has lost vital personal documents and so on.
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Some genuine LOL moments from this compilation of mini videos. Only click through if you don’t mind killing some time as there are enough gems in there to keep you scrolling. Bonus points to the editors for including several turtle clips (seriously folks, it’s not all about cats and dogs).

Kieran has already posted about the death of Robert Bellah. There haven’t been many obituaries yet. Even so, I haven’t seen any mention in the write-ups so far of a little known episode in Bellah’s past: his encounter with McCarthyism at Harvard.

(All of the following information comes from Ellen Schrecker’s No Ivory Tower: McCarthyism and the Universities, which I highly recommend to anyone interested in the topic. You’ll never look at your favorite mid-century scholar the same way again.)

As an undergraduate at Harvard in the late 1940s, Bellah had been a leader of the university’s undergraduate Communist Party unit. He left the party in 1949 because of its increasing internal authoritarianism.

In 1954, while Bellah was a graduate student at Harvard, the FBI was nosing around asking questions about people’s Communist past and present. Harvard Dean McGeorge Bundy, who would go on to serve as National Security Advisor to Kennedy and Johnson, summoned Bellah to his office and instructed him to answer all of the Bureau’s questions with “complete candor.” If he did not, Bundy warned, Harvard would revoke his fellowship. [click to continue…]