Im-Politic: A Better Way to Pressure Mexico on Immigration

Tags

Border Crisis, border security, Central America, Charles Grassley, illegal aliens, Im-Politic, immigrants, Immigration, Mexico, migrants, remittances, tariffs, Trade, Trump, U.S.-Mexico-Canada Agreement, USMCA

It’s not every day that I praise veteran Republican Senator Charles Grassley of Iowa. In fact, I don’t believe I’ve ever praised him in print. On trade policy he’s often especially especially clueless – his last foray into this field consisted of threatening to use his chairmanship of the Senate Finance Committee to scuttle the U.S.-Mexico-Canada Trade Agreement (USMCA) unless President Trump withdrew his tariffs on metals imports from Mexico and Canada.

(Grassley was upset because Mexico in particular had retaliated by slapping tariffs on some key American farm products exported by states like Iowa. He didn’t seem to realize that, as I’ve written here, the tariffs needed to be global in scope to be effective. Meanwhile, however serious American farmers’ woes, they began in earnest years before any Trump tariffs went into effect.)

So imagine my surprise yesterday upon learning that Grassley has proposed a response to Mexico’s foot-dragging on helping to ease the crisis on its border with the United States that’s much better than President Trump’s tariffs.

According to Grassley, the way to pressure Mexico to tighten its own curbs on the floods of Central Americans streaming through its territory toward the United States is to tax the remittances sent to their home country by Mexicans who have moved northward both legally and illegally.

Remittances consist of money sent by immigrants back to their home country – usually to relatives. They encourage immigration because they come from wages earned by newcomers to the United States that are much higher than those they can make in their countries of origin.

And we’re unmistakably talking big numbers – especially for Mexico. The country’s own central bank pegged them at almost $31.5 billion last year. That’s more money coming into the Mexican economy than it makes from oil exports, and in fact its second largest foreign exchange earner after auto parts exports.

Unlike tariffs, remittances taxes wouldn’t harm Americans who buy imports from Mexico – whether consumers or businesses. All the victims would be Mexicans in Mexico. And because so many poor Mexicans in particular rely on these funds to help maintain and improve their living standards, a smaller flow would squeeze their finances and surely increase political instability in a country that’s long suffered more than its share of turmoil. Don’t think Mexico’s leaders – who are already sounding inclined to make concessions to Mr. Trump to avoid the threatened tariffs – could brush these sanctions off.

At least as important, unlike the proposed tariffs, remittance taxes wouldn’t endanger Congressional passage of the USMCA or undermine the Trump administration’s China trade policies by reducing Mexico’s attractiveness as an alternative export platform for companies looking to move in whole or in part out of the People’s Republic.

The President has actually spoken of taking this step to raise the resources needed to finance a Border Wall, but never followed through. At the time, covert and overt Open Borders supporters charged that the move could be counterproductive, since the remittances increased the well-being of their recipients enough to encourage them to stay in Mexico.

But since these payments still represent only a fraction of the earnings of Mexicans in the United States, it makes no sense to believe that many Mexicans in Mexico seriously contemplating moving across the border would be satisfied by receiving a fraction of a loaf if they thought it was all potentially available.

It’s possible that the Trump tariff threat could suffice to produce enough of a Mexican response to satisfy him on border security and declare victory with no levies. In this vein, it’s significant that Mexico’s president has already signaled his willingness to appease Mr. Trump somehow. But a remittances threat could have accomplished the same goal with much less muss and fuss. If negotiations with Mexico can’t resolve the issue by the announced Trump deadline of June 10, switching tactics to a remittances tax a la Grassley would be an unmistakable no-brainer.

Advertisements

Im-Politic: The Washington Post’s Nazi-Baiting on Trump & Immigration

Tags

Adolf Hitler, asylum seekers, border security, Central America, Franklin D. Roosevelt, Im-Politic, Immigration, Isaac Stanley-Becker, Mainstream Media, migrants, Nazism, Open Borders, refugees, Trump, Trump Derangement Syndrome, Washington Post

Just when I think that I couldn’t become angrier at the bile spewed by some of President Trump’s critics and too often reported as fact or respectable, newsworthy opinion by the Mainstream Media, Trump Derangement Syndrome sufferers keep topping themselves. And this morning I saw a series of such statements so inexcusable that I’ve decided to post about them even though I’ve already expressed my views in a tweet.

The accusations came in a Washington Post article today titled “’Our country is FULL!’: Trump’s declaration carries far-right echoes that go back to the Nazi era.”

Reporter Isaac Stanley-Becker was referring to the remarks made by Mr. Trump last Friday during his visit to the U.S.-Mexico border, where even champions of what I’ve come to call the Functional Equivalent of Open Borders are now finally admitting that flows of migrants mainly from Central America are overwhelming federal government facilities set up to deal with foreigners seeking to cross into the United States.

Stanley-Becker, who is based in London, wasn’t simply content to observe that the President’s language “fits a pattern of far-right rhetoric reemerging globally. Fear of an immigrant takeover motivates fascist activity in Europe, where, historically, the specter of overcrowding has been used to justify ethnic cleansing.”

With the evident endorsement of his editors, he went on to write that “Adolf Hitler promised ‘living space’ for Germans as the basis of an expansionist project….”

In this vein, he sought to legitimize this analysis by quoting an historian (from the University of California at Berkeley) who contended “The echoes do indeed remind one of the Nazi period, unfortunately. The exact phrasing may be different, but the spirit is very similar. The concern about an ethnic, national people not having proper space — this is something you could definitely describe as parallel to the 1930s.”

In addition, Stanley-Becker reported that “The president’s words became even more freighted when he repeated them on Saturday before the Republican Jewish Coalition in Las Vegas, saying, ‘Our country is full, can’t come. I’m sorry.’” (Which sounds like an opinion, not the kind of fact that news reporters are supposed to present in their own voice.) And he supposedly documented the follow-on statement that Mr. Trump’s remarks “drew outrage” by citing precisely one tweeter and Democratic presidential candidate Beto O’Rourke.

The author was clever enough to slip into his story the kind of qualifier meant to convey objectivity but skated over far too quickly to alert most readers to their potential to invalidate the entire exercise. For example, Stanley-Becker briefly noted that “Hitler promised ‘living space’ for Germans as the basis of an expansionist project, which historians said distinguishes the Third Reich from today’s xenophobic governments.”

But in case you’re tempted to conclude “That distinction seems pretty darned important,” the author hastily added, in a classic example of insinuation, “Still, experts found parallels” (by which he meant the aforementioned Berkeley professor).

Moreover, let’s not forget the towering double standard Stanley-Becker and similar Trump haters have created. For if the President’s words and (prospective) actions “echo” and “remind” of Nazism, what should be made of former President Franklin D. Roosevelt – under whose administration refugees from the Third Reich itself were turned away from American shores? Does this record reveal racist, anti-semitic, xenophobic Nazi sympathies? Or “echo” them etc.? In fact, Roosevelt’s name isn’t even mentioned in the article, even though he received cables from the ship on which they traveled begging for admission.

Does Roosevelt deserve such descriptions – and condemnation?  If not, why not?And to return to current circumstances, President Trump has clearly been reacting against the large numbers of U.S.-bound migrants falsely seeking asylum (which is awarded to those fleeing persecution) who are seeking better material lives. Roosevelt was denying entry to individuals and families clearly seeking to escape a regime that was obviously targeting them because of their identity.

Because this is a free country, Stanley-Becker, his editors, and his publisher have every right to accuse President Trump of using coded, pro-Nazi or Nazi-sympathizing dog-whistle attacks to advance his immigration policies. But their profession’s ethics prohibit them from portraying these views as unvarnished facts in news columns. And common decency demands they have the courage to make these charges openly, rather than using the weasel words and phrases and similar ploys so typical of character assassination.

Im-Politic: Caravans and Open Borders Grandstanding

Tags

asylum seekers, caravans, Central America, Hillary Clinton, Im-Politic, Immigration, migrants, refugees, Trump

By now it’s become an article of faith among President Trump’s critics that his stated determination to prevent the caravans of Central American migrants from entering the United States represents a shameful, and possibly racist, break with America’s longstanding tradition of providing haven for victims of poverty, persecution, and numerous other hardships and outrages that remain all too common abroad.

In other words, in striking contrast to the Statue of Liberty’s message of welcome for the world’s “tired…poor…[and] huddled masses yearning to breathe free,” Mr. Trump and his supporters are cruelly telling the Central Americans to return to their destitute and violence-wracked countries.

So what do the critics believe should be done instead? Specifics are often lacking, but let’s do a thought experiment and try to figure out how a policy that literally doesn’t “turn its back” on downtrodden foreign populations would like. That is, let’s try to imagine the gist of what a President Hillary Clinton would say about the caravans if she took seriously claims that the Trump approach to the problem is unforgivably callous and wrongheaded – claims that she’s made clear she agrees with via her strong condemnation of Trump administration policies that have resulted in frequent separation of migrant children from their parents:

“My fellow Americans:

“As you have seen in many news reports, several so-called caravans of Central Americans are heading north, through Mexico, filled with men, women, and children hoping to make new lives in the United States.

“Many politicians and news organizations in conservative and Republican ranks, along with out-and-out right-wing extremists, have portrayed this caravans as an impending ‘invasion’ of our country. They’ve urged my administration to deal with this ‘national security emergency’ by taking all necessary steps to turn the migrants back – including stationing the American military at the border.

“I come before you tonight to make clear that I will strongly reject such measures. They would represent a violation of our solemn international treaty obligations. They would amount to a betrayal of America’s long, proud history of welcoming immiserated populations from all corners of the world. And they would ignore simple human decency. In fact, some who urge a hard line toward the migrants are clearly playing on longstanding dark, but completely unjustifiable, fears about foreigners and even about racial and ethnic minorities.

“So I will not send regular military or even national guards units to the border. I will not beef up Border Patrol deployments. And I certainly will not begin building a Wall – as my chief opponent in the last election so foolishly and crudely recommended.

“Nor will I outsource my migrants policy to Mexico, or to the migrants’ home country governments. For none of these countries can guarantee the migrants the safety from crime and violence and the escape from poverty that they, like all members of the human family, deserve.

“In fact, I’m issuing an Executive Order that explicitly establishes gang and domestic violence as valid reasons for granting asylum. For aren’t these dangers just as appalling and inexcusable as the religious, political, and other forms of persecution to which grants of asylum have historically been restricted? Further, this new directive will abolish the artificial distinction between refugees from these horrors and refugees from joblessness, threadbare wages, hunger, homelessness, and other forms of economic privation. For if you’re being victimized for your political leanings or religion or nationality, you’re almost surely trapped in grinding, dehumanizing poverty as well.

“Of course, I’ll be directing that much more of the Justice Department’s budget be allotted to end the shortage of immigration judges that has produced immense backlogs in our immigration courts. Yet until the shortage ends, I will also mandate the construction of high quality accommodations for asylum applicants awaiting a hearing, including first-rate schooling for their children. And needless to say, applicants will enjoy the full come-and-go freedom to and from these facilities. Otherwise, we’d be putting them in cages, however gilded.

“Moreover, I will immediately put into effect my campaign promise to increase five-fold America’s admissions of refugees from Syria’s horrendous civil war. In fact, I apologize to these refugees for waiting so long to address their plight.

“And finally, because too many recent arrivals – from Central America and elsewhere – continue living precariously in the shadows, I will restrict the enforcement of domestic immigration law to finding and deporting dangerous criminals. For far too long taxpayers – including these many of these Aspiring Americans – have paid far too much money for the hounding of individuals and families whose only illegal behavior has been seeking better lives.

“We Americans need to remember: Except for our native American and native-born African-American populations, practically all of our ancestors came to this country for the exact same reasons motivating the Central Americans and so many others today. The Pilgrims were seeking freedom of religion. The Jamestown settlers were economic migrants. How can we deny caravan members and others like them the same opportunities that our nation has extended to our own forebears?

“The answer, it must be clear, is that we mustn’t and we can’t – if we want to be law-abiding global citizens, if we want to be true to our country’s best traditions, and if we want to be able to look ourselves squarely in the mirror.”

Pretty inspiring, isn’t it? But before you pick up the phone to call your Member of Congress (or the White House) to demand implementation of this agenda right now, ask yourself about the impact of an announcement like this. According to Gallup, as of last year, nearly 150 million people around the world would like to move to the United States. That includes 37 million Latin Americans.

Yet since the situation in Central American has clearly worsened over the last year, along with the crisis in Venezuela, that figure now is surely conservative. Additionally, the Trump administration’s current attitude towards migrants could well be depressing the number who consider migrating to the United States an option worth thinking about even idly. The kind of welcoming position Trump critics seem to want – i.e., one that further and greatly strengthens already powerful magnets that have attracting enormous foreign populations to this country – could well supercharge their ranks.

The lessons of this exercise couldn’t be clearer. If you believe that the United States could easily absorb anything close to this inflow in the near future, go right on lambasting the Trump administration and supporters of its immigration policies as modern day [INSERT YOUR FAVORITE ARCH-VILLAIN FROM HISTORY OR LITERATURE HERE]’s. But if you’re genuinely interested in devising an immigration and migrants and refugee policy that acceptably reflects your version of America’s values but recognizes the inevitable limits on such good intentions, you’ll start grandstanding less and thinking about the who, what, how, why, when, and where more.

Making News: Back on National Radio Talking Trump, Trade, & China…& More!

Tags

caravans, Central America, China, Gordon G. Chang, IndustryToday.com, Making News, migrants, The John Batchelor Show, Trade, trade war, Trump

I’m pleased to announce that I’m scheduled to return to John Batchelor’s nationally syndicated radio show tonight at 9:30 PM EST.  You can listen live here as John, co-host Gordon G. Chang, and I talk about President Trump’s China trade policies with a special focus on public opinion.

If you can’t tune in tonight, as always, I’ll post a link to the podcast as soon as one’s available.

Also, it was great to see IndustryToday.com re-post (with permission, of course!) my column from earlier today on U.S. trade policy’s culpability for the Central American migrants’ crisis.

And keep checking in with RealityChek for news of upcoming media appearances and other developments.  Better yet – follow the blog and make sure that notices about every new item get sent to your email inbox!

(What’s Left of) Our Economy: U.S. Trade Policy Deserves Blame for the Caravans

Tags

apparel, asylum seekers, Bangladesh, CAFTA, caravan, Caribbean Basin Initiative, Central America, Central America Free Trade Agreement, China, economic development, El Salvador, globalization, Guatemala, Honduras, immigrants, Immigration, manufacturing, migrants, Multi-Fibre Arrangement, NAFTA, North American Free Trade Agreement, Northern Triangle, Trade, Uruguay Round, Vietnam, World Trade Organization, WTO, {What's Left of) Our Economy

Hot on the heels of the current caravan of Central Americans heading through Mexico to the U.S. border, another such procession is gathering in Guatemala. And these two have followed the flood of unaccompanied migrant children from the area that reached the United States in 2014.

I wish I could tell you that there’s a silver bullet for solving the problem – though nothing could be clearer than that these human tides will keep organizing in even greater numbers if Washington follows the general advice of the Open Borders lobby to view all of the caravan-ers as legitimate asylum-seekers entitled to full due process once they reach the border and request this status. Upon which time current procedures call for recording their claims and then releasing them based on the ludicrous assumption that they’ll report back to immigration court on the appointed date and risk being rejected and thus deported.

What I can tell you is that this crisis has been greatly aggravated by an unforgivably short-sighted U.S. trade policy strategy that emerged in the 1990s. It consisted of indiscriminately liberalizing trade with developing countries, and thereby ignoring the case for targeting trade diplomacy to ensure that countries and regions of greatest importance to the United States receive the lion’s share of the benefits. And the prime victims of this strategic failure – which mainly reflected the determination of offshoring multinational manufacturers and Big Box retailers to gain maximum flexibility to source imported inputs and final products – were the poorer countries of the Western Hemisphere. That group of course includes Mexico and the Central American countries that have sent so many migrants northward.

Interestingly, Central America and the Caribbean countries were placed prominently in line to receive significant shares of the vast U.S. market by a Reagan-era initiative aimed mainly at stemming the spread of left-wing revolutionary forces in the region. But scant years later, any hopes generated by this strategy for fostering more prosperity in these impoverished regions and strengthening the appeal of pro-Western leaders were kneecapped by two big decisions.

The first was the negotiation of the North American Free Trade Agreement (NAFTA) in 1993. The second was the phase out of U.S. and other developed countries’ quotas on apparel imports that was approved the following year as part of the Uruguay Round global agreement that reduced various trade barriers worldwide and created the World Trade Organization (WTO). And the third was the Clinton administration’s subsequent rush to liberalize trade with a host of low-income countries outside the Western Hemisphere.

In principle NAFTA’s tight focus on Mexico was justifiable given Mexico’s size, position as a U.S. neighbor, and history of political, economic, and social policy failure that seemed to be reaching a crisis point. But economic growth and employment could still have been greatly lifted in Mexico and Central American (along with the Caribbean countries) had American trade liberalization stopped or at least paused there.

Yet the quota phaseout forbade Washington from incorporating any strategic or non-economic considerations into apparel trade policy, whether conditions urgently required them or not.  As a result, it ensured that the benefits of freer trade would be greatly watered down (and many garnered by China and the rest of developing Asia in particular), and insult was added to injury by new liberalization deals reached or renewed, or decisions made, regarding Vietnam, sub-Saharan Africa, Jordan, most of developing Asia (in the form of a deal on information technology products, including labor-intensive consumer electronics), and China. Largely as a result, the poorer countries of the Western Hemisphere were left in the dust in the business models of the multinationals and the big retailers.

Nowhere does the opportunity lost by Mexico and Central America come through more clearly than in the apparel trade figures. This sector is almost always the first utilized by developing countries to begin their industrialization and modernization drives mainly because its own labor intensivity means that capital and technology requirements are pretty modest, the relevant skills can be taught fairly easily, and its job-creation promise is substantial.

Here are the figures for apparel imports from Mexico, the three “Northern Triangle” Central American countries, China, and two other current Asian textile giants (Bangladesh and Vietnam) for four key years. Next to them will be the figure for the share of American apparel consumption (market share) won at that point by each. We start with 1997 because that’s the year when the U.S. government began adopting its current dominant system for slicing and dicing trade and manufacturing data – which enables us to see statistics that are apples-to-apples. The second year is 2001 – the year China’s was admitted into the WTO – and thus gained substantial immunity from American laws aimed at curbing predatory trade practices. The third year is 2006 – when Congress approved a Central America Free Trade Agreement (CAFTA) negotiate by George W. Bush’s administration. And the fourth year is last year – the latest for which we have full-year numbers.

1997

Mexico:                       $5.317b                    11.29 percent 

El Salvador:                 $1.052b                     2.18 percent

Guatemala:                  $0.973b                     2.07 percent

Honduras:                    $1.689b                     3.59 percent

China:                          $7.279b                   15.46 percent

Bangladesh:                 $1.442b                      3.06 percent

Vietnam:                      $0.026b                      0.06 percent

2001:

Mexico:                       $8.112b                     12.99 percent 

El Salvador:                 $1.634b                      2.62 percent

Guatemala:                  $1.630b                       2.61 percent

Honduras:                    $2.438b                       3.91 percent

China:                          $8.597b                     13.47 percent

Bangladesh:                 $2.101b                      3.37 percent

Vietnam:                      $0.048b                       0.08 percent

2006:

Mexico:                       $5.514b                       7.16 percent 

El Salvador:                 $1.408b                      1.83 percent

Guatemala:                  $1.685b                      2.19 percent

Honduras:                    $2.519b                      3.27 percent

China:                        $22.405b                    22.09 percent

Bangladesh:                 $2.915b                       3.79 percent

Vietnam:                      $3.226b                       4.19 percent

2017:

Mexico:                       $3.806b                       4.52 percent 

El Salvador:                 $1.920b                       2.28 percent

Guatemala:                  $1.371b                       1.63 percent

Honduras:                    $2.522b                       3.00 percent

China:                        $29.322b                     34.85 percent

Bangladesh:                $5.046b                       6.00 percent

Vietnam:                    $11.613b                     13.80 percent

The big takeaway? Even during the decade after the Central America free trade deal was signed, the three Northern Triangle countries actually saw their share of the U.S. apparel market stagnate or actually shrink. Mexico’s share has been cut by about almost 60 percent. And the business won by China, Bangladesh, and Vietnam has exploded – since 2001 for China, and since 2006 for the two other Asians. Again, the year that the free trade deal that was supposed to benefit El Salvador, Guatemala, and Honduras was inked.

With Mexico, there are of course mitigating factors. Chiefly, although its apparel competitiveness in the U.S. market is way down, its competitiveness in higher value automotive manufacturing in particular is way up. But millions of poor Mexicans still could have benefited from apparel employment, and no such progress has been made in Central America – which is partly understandable since incomes are even lower, and governments and other institutions needed for economic development are so much weaker.

Apparel should have been the great hope for these populations, but that sector’s potential for expanding production (which of course needs to be export-oriented since these countries’ domestic markets are tiny) and employment has been virtually choked off. Just as important, the prospect that apparel wages in the Northern Triangle might rise adequately has been limited, too – since pay throughout developing East and South Asia (even in China, according to the chart below) remains so much lower.

American trade policy could have lent a big helping hand to Central America had it adopted a strategically sensible set of priorities. But it failed to learn a fundamental lesson of strategy: When everything is a priority, then nothing is a priority. You can see the victims of this failure in the flow of human misery heading up from the Northern Triangle.

(What’s Left of) Our Economy: Another U.S. Trade Deal that Puts America Last

Tags

apparel, CAFTA, Central America, Central Anerica Free Trade Agreement, dispute resolution, Dominican Republic, DR-CAFTA, free trade agreements, Guatemala, labor rights, legalism, offshoring, Trade, trade law, {What's Left of) Our Economy

To get a good idea of one of the biggest, and most neglected, failings of U.S. trade policy, look no farther than America’s near-neighbors in Central America. For earlier this month, a development on the labor rights front made clear the America Last approach Washington has taken toward the ways that disputes are handled under various trade agreements the United States has signed – in this case, the deal with six Central American countries plus the Dominican Republic (DR-CAFTA).

On June 14, an arbitration panel established by the dispute resolution chapter of the DR-CAFTA treaty ruled against the United States and for Guatemala in a long-running quarrel between the two signatories over labor rights practices in the latter. On the face of it, it’s hard to take seriously the arbiters’ conclusion that Guatemala indeed is not enforcing its own labor laws ostensibly aimed at safeguarding workers’ rights, but that this failure hasn’t affected bilateral trade flows. After all, in a world where its major industrial export industry – apparel – has to compete on price with super-low wage garment giants like China, Vietnam, and Bangladesh, keeping wages down is essential to the Guatemalan apparel sector’s very survival.

But the fundamental problem with this situation has nothing to do with the merits of the case. It has to do with the structure of the dispute-resolution process set up by the DR-CAFTA treaty, which is basically the same as that set up by all U.S. bilateral and regional free trade deals. Simply put, it bears absolutely no resemblance to economic or policy realities.

Two especially important and related points to keep in mind: First, when the DR-CAFTA deal was ratified by Congress, in 2005, the combined economies of all six Central American countries proper only equaled the output of New Haven, Connecticut. Adding the Dominican Republican barely moved this needle. Because of this gargantuan size disparity, access to the American economy was clearly the paramount prize in this arrangement, and the non-U.S. signatories needed the deal much more than did the United States.

Second, largely as a result, the DR-CAFTA deal was less an example of trade policy than of economic development policy. Yes, cheerleaders for the agreement talked of opening exciting new markets for American domestic producers – talk belied by the micro nature of Central American and Dominican markets). And yes, they spoke of enhancing the competitiveness of the American textile industry – claims belied by the impossibility that the pact could overcome the advantages of the Asian apparel giants). But at bottom, the deal was a foreign aid program for the region.

Leave aside its clear failure to achieve meaningful “democracy, economic reform, and regional integration” – at least if you believe even a fraction of countless news reports of out-of-control lawlessness and violence in Central America. Given the non-U.S. signatories’ desperate need for any American help they could get, why on earth would Washington permit the treaty to create a system for choosing arbitration panels – which have the last say in determining a dispute’s winner and loser – that treats the United States and the other DR-CAFTA countries as legal equals?

One answer is that the agreement – like many other U.S. trade deals – was actually intended to foster offshoring, not open foreign markets. So the multinational companies that have dominated the American trade policymaking process for so long made sure that dispute resolution aimed first and foremost to prevent the United States from limiting its imports from their Central American and Dominican factories for any reason. And given the absence of significant consumption markets in the region, that observation seems compelling.

But the so-far-standard U.S. approach to dispute-resolution in trade also typifies a legalistic worldview that contrasts sharply with global realities even in an economic sphere where, for numerous reasons, it’s still completely inappropriate. In fact, this legalism is likelier to undermine American interests than serve them.

Principally, the prevalence tariff and non-tariff barriers to both trade and investment, along with various other predatory practices, shows that the consensus on acceptable economic behavior needed for a genuine legal system to function adequately simply does not exist in fact. Ditto for the great majority of economies that rely heavily on amassing net exports to generate growth. As a result, international commerce is anything but the positive-sum arena portrayed by politicians and academics. So any arrangements meant to negate national power are bound to handcuff the United States. Worse, they handcuff America needlessly.

Perhaps one day, the worldwide consensus needed for a genuine, legitimate system of trade law will emerge. Until it does, however, the United States should capitalize on the leverage it enjoys as the world’s most open major trading power and market of last resort, and sign trade agreements that establish it as judge, jury, and court of appeals for whatever disputes arise. There’s no better place to start than scrapping the artificial – and indeed forced – egalitarianism of the DR-CAFTA trade agreement.

(What’s Left of) Our Economy: Economic Data Journalism That’s Missing Key Data

Tags

border security, Central America, child migrants, China, furniture, Hickory North Carolina, Honduras, illegal immigrants, Immigration, manufacturing, migrants, Obama, Reuters, Sonia Nazario, statistics, The New York Times, The Wall Street Journal, The Washington Times, Trade, U.S. Customs and Border Patrol, {What's Left of) Our Economy

“Data journalism” is supposed to have been all the rage in the press recently. Why, then, do so many reporters keep ignoring crucial statistics when covering economic and other trends? Several major news organizations have combined to provide two examples of how much needless confusion these oversights can create.

The first instance concerns illegal immigration, and specifically the ongoing heart-breaking story of children fleeing rampant gang-related violence in Central America. Last week, The New York Times carried an article by a Pulitzer Prize-winning author that described a promising ray of light in this grim picture. According to author Sonia Nazario, new U.S. government programs have been largely responsible for “a remarkable reduction in violence” in the neighborhoods in Honduras in which they’ve been introduced. And as a result, even though the situation in the rest of the country remains dire, “fewer children are coming to the United States from Honduras.”

Further, Nazario writes, this success “offers a striking rebuke to the rising isolationists in American politics. A Pew Research Center poll in April found that most Americans think the United States should ‘deal with its own problems’ while others deal with theirs “as best they can,” a sentiment that’s at the core of Donald J. Trump’s ‘America First’ slogan and ‘build a wall’ campaign. Many seem to have lost their faith in American power.”

To her credit, Nazario has done extensive local reporting on the issue, and the encouraging developments she has apparently found on the ground deserve to be taken seriously. At the same time, the sources she cites for the numbers she presents all have a strong stake in portraying the aid programs as a success – specifically, America’s ambassador to this forlorn country, U.S. aid and narcotics control officials along with contractors administering these programs, and local Honduran recipients of the funds and other resources.

This possibility alone should have tipped her or her editors off to that some independent verification was needed. And it was all the more essential because the U.S. government data has just reported that, over the past fiscal year, the number of child migrants and entire families from Honduras caught trying to enter the United States illegally is up, not down. (Hat tip to The Washington Times for breaking this story.)

The U.S. Customs and Border Patrol, a division of the Department of Homeland Security, has stated that for the entirety of fiscal 2015, a total of 16,080 Honduran illegal border crossers were apprehended – 10,671 “family units” and 5,409 unaccompanied children. Through this July – two months before the end of the current fiscal year – the total jumped to 23,270, or by a total of 44.71 percent. The number of family units hit 15,142 (41.90 percent higher) and the number of unaccompanied children reached 8,128 (50.27 percent higher).

It’s possible that the total number of Honduran leavers is down, and that most aren’t caught. But the burden of proof is on Nazario and The Times to make this case.

Another recent development undercutting Nazario’s thesis: Late last month, the Obama administration announced (as reported in The New York Times) “a substantial expansion of a program to admit Central American refugees to the United States, conceding that its efforts to protect migrants fleeing dangerous conditions had left too many people with no recourse.”

Nazario could claim both that the administration is simply bowing to the continuing humanitarian tragedies in El Salvador and Guatemala, where the programs she touts haven’t been introduced. But the president’s decision certainly doesn’t seem to reflect much optimism concerning their potential. She could also point to her observation that the Honduran programs have run into opposition in Congress, and contend that the president decided to take the path of least resistance. Yet lawmakers are even less likely to support more admissions.

What is clear is that she either chose not to seek out statistics that undercut her hopeful narrative, or that she didn’t know they exist. Neither possibility should inspire confidence in her credibility.

The second example of failing to consult the data was provided by The Wall Street Journal and Reuters, which recently published dueling articles on the state of American manufacturing and its recent record of coping with Chinese competition. Their special focus was the same, too – Hickory, North Carolina, a supposedly typical long-time American manufacturing center.

The Journal piece seemed to focus more on Hickory’s continuing challenges; the Reuters article “accentuated the positive.” Both articles provided plenty of numbers about manufacturing job loss and recent recovery, too. But neither publication told readers anything about the most important Hickory- and manufacturing-related figures of all – those on production. For without healthy levels of production, healthy levels of employment (however you define that term) are impossible to sustain over any length of time. And the figures show that, in Hickory, both in manufacturing overall and in furniture production (the area’s signature sector), activity remains severely depressed.

A good baseline year is 2002. That was the first full year of Chinese membership in the World Trade Organization, and therefore the first full year in which it enjoyed substantial immunity from U.S. laws and other policies aimed at combating its still widespread predatory trade practices.

In 2002, furniture and related industries comprised fully 30 percent of the Hickory metropolitan area’s total manufacturing output (after adjusting for inflation), with a total output of $1.339 billion. The latest furniture-specific figures available for Hickory only go up to 2013, but they show a sharp inflation-adjusted production decline – to just $816 million. In fact, the hit to Hickory’s real furniture output (39.10 percent) was greater than for total furniture production in American metropolitan areas (31.03 percent).

Hickory’s furniture performance looks better since 2009. From that recession year through 2013, the sector’s real production rose by 26.71 percent. That’s more than three times faster than the rate for all of America’s metro areas (7.73 percent).

But contrary to the Reuters piece, this achievement hasn’t translated into a notable broader manufacturing upswing in the region. From 2009 to 2014, overall U.S. Metro area manufacturing output advanced by 10.69 percent in real terms. For Hickory and environs, the real growth was only 9.45 percent.

Like Nazario in Honduras, the reporters who worked on these Hickory manufacturing stories clearly spent considerable time in the area surveying the manufacturing scene. And since the data is a little dated, no one should rule out the chance that Hickory’s manufacturing output has experienced a true surge since then. But that would mean that industry in Hickory has escaped the fate of industry nation-wide. Because around that time, after-inflation production growth in America began slowing dramatically. Indeed, for most of this period, it’s been in recession.

Reality certainly is too complicated to be reduced to numbers alone, and data itself can be methodologically flawed, incomplete, out of date – and intentionally distorted. But used properly and with integrity, data can be a useful check that can prevent simple anecdotes from being confused with genuine trends. So although journalists shouldn’t be slaves even to the very best numbers available, there’s no reason or excuse to ignore them.

Im-Politic: How Polls Skew Their Results on Immigration and Amnesty

Tags

amnesty, attrition, Central America, chattering class, Cheap Labor Lobby, Democrats, deportation, Donald Trump, illegal immigration, Im-Politic, Immigration, legalization, magnet effect, Mainstream Media, Open Borders, path to citizenship, polls, The Washington Post

The Washington Post editorial board seems pretty confident that if U.S. immigration policy faithfully reflected the views of the majority of the American people, it would come down decisively for the first option in the “bottom line question – should illegal immigrants stay or go.” Too bad the Post writers either didn’t read the collection of polls they cited, or decided to cherry pick the results. For these same surveys show how crimped the debate permitted by them and their Mainstream Media and chattering class colleagues has been. Moreover, many of their findings point to immigration policy perceptions and priorities that are much more Trump-ian than the Post and other amnesty supporters would like.

The Post is correct in noting that most respondents in most polls asking the question support either (a) granting illegal immigrants a path to citizenship, provided that certain conditions are met (like paying fines and back taxes, and learning English); or (b) awarding them legal status short of citizenship (also usually with conditions). But it’s stunning to see how completely polling organizations have ignored two major anti-amnesty considerations in the choices they present.

In particular, of the 70 surveys in the set used as evidence by the Post, none indicates to Americans that amnesty, active deportation efforts, or simply continuing the illegal immigration status quo are far from the only options available to policymakers. In fact, not a single one of these polls mentions attrition as a strategy for dealing with the illegals problem.

It’s true that such an approach would leave many illegals resident in the United States. But measures like denying these immigrants most government benefits – including driver’s licenses and access to the financial system – and enforcing existing laws against hiring them (which is overwhelmingly backed by Americans) – would undoubtedly reduce their numbers significantly. The more sluggish the U.S. economy and its creation of all manner of jobs remains, moreover, the more effective attrition would be. And this policy would arguably be much cheaper than at least one condition typically attached to amnesty-like proposals – conducting “background checks” on all illegals who apply. Just to remind, their total numbers are pegged at about 11 million.

Equally important, only one of the 70 surveys in this compilation even mentioned to respondents a major anti-amnesty argument: the likelihood that such lenient American policies would create a powerful magnet effect and lure many more immigrants into the country. This survey was conducted by the Public Religion Research Institute in late-July, 2014, and focused on the surge of Central American child migrants that began trying to cross U.S. borders in spring and summer of that year.

One of the first questions the Institute asked was whether Washington “should offer shelter and support [to the children] while beginning a process to determine whether they should be deported or allowed to stay in the U.S. [or whether America] should deport them immediately back to their home countries.” “Shelter and support” while investigating their circumstances beat “deport them immediately” by a wide 70 percent to 26 percent margin. But then, quite a few questions later, respondents were asked whether they agree that “The U.S. should NOT allow children coming from Central America to stay because it will encourage others to ignore our laws and increase illegal immigration.” Fifty-nine percent “completely” or “mostly” agreed; only 39 percent “completely” or “mostly” disagreed – a big turnaround.

It’s also worth noting that children are understandably an immigrant group that’s bound to elicit considerable sympathy. Imagine how the public might respond when told by pollsters that citizenship or legalization offers could greatly boost inflows of all kinds of immigrants.

Also supporting the notion that mentioning the magnet effect would dramatically change poll answers on amnesty-like policies: This group of 70 polls consistently shows that large majorities of Americans favor reducing legal immigration or keeping the annual numbers where they are, rather than increasing it. So it seems logical that the U.S. public would reject citizenship or legalization policies if it learned they may well greatly increase the country’s overall foreign-born population. (At the same time, these polls make just as clear that most Americans believe that immigration’s benefits to the country – in terms of diversifying it and adding talent – outweigh costs such as lost jobs or greater welfare payments or diluted traditional values.)

No wonder, then, that Open Borders types in the Mainstream Media and in politics are so upset at Trump and others who favor more restrictive immigration policies. And no wonder they work so hard at sliming them as racists, nativists, and know-nothings. If Americans ever found out their real options on immigration policy, the demand for approaches that prioritize the interests of most of the native-born population first – rather than those of the Cheap Labor Lobby, Democratic Party wannabe ballot-stuffers, elitist liberal guilt-mongers, and self-righteous one-world-ers – could become irresistible.

Im-Politic: Budget Strengthens Case that Obama’s Border Security Strategy isn’t Serious

Tags

Biden, border security, budget, CAFTA, Central America, Colombia, foreign aid, George W. Bush, Im-Politic, Immigration, Obama, Plan Colombia, Ronald Reagan

With immigration and Department of Homeland Security funding at the center of a looming budget showdown between President Obama and Congress’ Republican leaders, it’s surely useful to look over the new Obama budget and see what it actually proposes on this front. And it’s hard to avoid concluding that the president’s claimed determination to bolster border security shouldn’t be taken seriously.

Let’s leave aside Mr. Obama’s “executive amnesty” move last fall, which can only strengthen the already powerful policy magnet that’s been luring illegal immigrants to the United States for so long. Yes, the president did propose to increase border security funding by nearly 25 percent over current funding levels – to just under $374 million. But the week before the official budget request was unveiled, the administration dropped a powerful hint that it doesn’t expect any of these new resources to do much good. Why else would the White House have touted so prominently – in a New York Times op-ed by the Vice President – its decision to attack the proverbial root causes of last year’s Central American immigration surge by spending $1 billion to promote reform in the region?

The administration’s ostensible belief that the best way to deal with the international problems facing the United States is to manipulate hard-to-contol revents abroad is, as I’ve written, a time-honored tenet of American foreign policy. With the huge but long-ago exceptions of post-World War II aid to Western Europe and Japan, this strategy has also failed so completely in the closely related foreign aid and trade spheres that it deserves the label delusional. Moreover, as I’ve also written, this approach becomes absolutely unforgivable upon realizing the unique geopolitical advantages enjoyed by the United States that make much easier-to-control and more promising domestic solutions – like serious border security efforts, in this case – vastly superior.

After all, it’s not as if the United States hasn’t tried promoting reform in Central America before. During the Cold War, President Reagan launched a “Caribbean Basin Initiative” aimed at preventing the rise of “new Cubas” and a repeat of the Sandinista revolution in Nicaragua. In 2005, Congress passed President George W. Bush’s Central America Free Trade Agreement, which was hyped in part as an immigration control measure. Vice President Biden’s own new article makes clear that substantial American aid to the region has been continuing. Yet he admits that the region’s countries are still held back by “inadequate education, institutional corruption, rampant crime and a lack of investment….”

Nor does Mr. Biden stop there in knee-capping his apparent belief that yet more money is the cure for most of what ails Central America. He adds that Central American countries and their economies still lack “clear rules and regulations; protections for investors; courts that can be trusted to adjudicate disputes fairly; serious efforts to root out corruption; protections for intellectual property; and transparency to ensure that international assistance is spent accountably and effectively.” Who can reasonably doubt, therefore, that what’s fundamentally crippling the region after all this time is not a lack of resources (especially considering how tiny these nations are) but a dysfunctional political culture. And why on earth does the Vice President suggest that this disease can be cured with more “training”?

Mr. Biden at least does provide some concrete answers – mainly, the U.S.-assisted transformation of the much larger nation of Colombia. There’s no doubt that progress has been made in that strife-torn country on many fronts. According to World Bank data, economic growth has been trending up and the poverty rate is declining. At the same time, though down from its peak at the turn of the century, illicit drug production in the country has now stabilized, and a final peace agreement to end Colombia’s 30-year insurgency remains elusive. (Indeed, casualties continue.) Moreover, although this progress has been made at the cost of $9 billion from American taxpayers, the Obama administration is still asking Congress for nearly $300 million more in annual aid in its new budget. More ominously, the end of a long global boom in raw materials is already imposing major economic pain throughout Latin America, which has relied on strong commodity exports for much of its recent growth. So expect those root socio-economic roots of mass emigration to start growing again all over the region.

A president serious about sensible immigration reform would recognize what a losing battle the nation has been fighting in order to curb illegal migrant inflows at their sources. Mr. Obama’s continued hype of these utopian proposals greatly strengthens the case that he’s anything but that president.

Our So-Called Foreign Policy: Why the Obama Cuba Announcement is a Nothing-Burger

Tags

Castro, Central America, Cold War, Cuba, Cuban Missile Crisis, diplomatic relations, Monroe Doctrine, nuclear buildup, Obama, Our So-Called Foreign Policy, Reagan administration, Soviet Union, Western Hemisphere

President Obama spent 12 minutes today announcing his decision to establish full U.S. diplomatic relations with Cuba for the first time since 1961. My main reaction? That was about 12 minutes longer than justified by the decision’s importance. And you can imagine what I think about all of the government time, energy, and resources expended in preparation of this move.

Yet a scientific poll of the reactions they’ve generated indicates that my tweets this morning about this move’s monumental insignificance have caused widespread confusion, and even consternation. Specifically, my indifference to the Cuba news is seen as completely incomprehensible. So let me explain – in the hope that such apathy will spread!

Not that I don’t understand the symbolic milestone represented by the Obama decision. As a card-carrying baby boomer, I have vivid memories of air-raid drills as a second-grader at P.S. 20 in Queens, New York during the Cuban Missile Crisis, when we’d be told to duck under our little wooden desks and warned, “No talking!” And of course, Cuba remained a Cold War bugaboo long after – especially from the late 1970s to the mid-1980s, when much of the American political class was frantic over the possibility that Cuban-advised forces would take over countries like Angola and El Salvador. (I kid you not.)

But that last sentence should start clearing up part of the mystery of my aloofness. For by that time, nothing should have been more obvious than that the East-West struggle had been reduced to little but a contest over countries lacking any intrinsic strategic or economic significance. Cuba – a charter member of their ranks – was stirring pots of no consequence.

Castro and Cuba did potentially (and for a short time actually) pose a serious threat to American national security. The island and any states brought into its orbit were always capable of hosting Soviet military forces and espionage facilities that could greatly complicate U.S. defense planning. The October, 1962 crisis itself was sparked by Moscow’s plans to base in Cuba nuclear missiles that could have struck the U.S. homeland in very short order.

But the best American response to these kinds of threats was never fighting proxy wars against communist or other radical foes in the Western Hemisphere, much less using foreign aid to innoculate its low-income countries against the ideological appeal of Moscow or Havana. It was using overwhelming U.S. strategic superiority in the hemisphere to enforce the Monroe Doctrine.

Indeed, I made this very proposal as the Reagan administration was embroiling the nation ever more deeply into Central America’s conflicts: Washington should inform those countries that their forms of government were of no intrinsic concern to the United States, but that America reserved the right to attack and destroy any concentrations of foreign forces on their territories it deemed worrisome.  (I can’t find the article on line, but it was in the October 5, 1987 issue of The New Republic.)

(It’s now highly controversial how great a role this strategic superiority played in the resolution of the missile crisis itself, since we now know that a secret agreement by President John F. Kennedy to withdraw American missiles from bases in the Soviet Union’s neighbor, Turkey, also played a major role in preventing war. At the same time, it’s been long believed that Moscow’s decision soon after the crisis to launch a huge strategic nuclear buildup reflected a determination never again to run the local or global risks of nuclear inferiority.)

Cuba – and the prospect of leftist revolutions in Central and South America – became even less important once the Soviet Union fell and Havana lost its major sponsor. So it makes perfect sense to ignore whatever policies American presidents decide to pursue with this small, weak, dirt-poor country.

So if you’re of Cuban descent, or have family and friends who are, or if you live in Florida, or if you just find Cuba interesting for whatever reason, by all means follow this story closely. Otherwise, if you’re concerned about the well-being of the United States or the world in general, stick with or shift over to higher priorities.  And for President Obama and other American leaders on both the Left and the Right, that goes double.