Archives: 11/2009

Just Say “No” to Competition

The Democrats who still control the Virginia State Senate (which wasn’t on the ballot this week) say they want to work with the new Republican governor.

“I won’t be like the House Republicans were, where anything they propose is bad,” said Senate Majority Leader Richard L. Saslaw (D-Fairfax), who like many Democrats says the GOP-led House obstructed the agenda of Gov. Timothy M. Kaine (D). “If there are areas where we can work things out, I’m ready, willing and able, and so is my caucus.”

But not so fast:

But asked about certain key pieces of McDonnell’s agenda, Saslaw demurred. Selling state-run liquor stores to raise money for transportation, for instance, would sacrifice the annual revenue the stores provide to schools and other purposes, Saslaw said. The Senate’s education committee remains opposed to changing state laws to allow more charter schools, another McDonnell proposal, he said.

No to bipartisan cooperation, no to competition, yes to hoary monopolies. Is that really the rock on which the Democrats want to make their stand as the country’s “implicit libertarian synthesis” yields a “libertarian moment”?

Liberty Most Deer

As a footnote to Chris Moody’s post about Monday’s 20-year anniversary of the fall of the Berlin Wall, I just came across this article about red deer refusing to cross from Germany into the Czech Republic.  This, of course, is a border that was the once heavily fortified dividing line between free West Germany and captive Czechoslovakia.

Even deer who weren’t born when barbed wire, watchtowers, and armed guards prevented the natural extension of their happy grazing grounds act as if the Cold War never ended — apparently because they learned their habits from their parents, who learned them from their parents.

Still, as with the new generation of Eastern Europeans who have no memory of Communism, some young deer are starting to break the mold, taking advantage of — and even taking for granted — their newfound freedom.  I wonder if the grass (and ferns, and whatever else deer eat) is any greener on the other side of the former Iron Curtain.

Who’s Blogging about Cato

Here’s a round up of bloggers who are writing about Cato research, analysis and commentary:

cmoody [at] cato [dot] org (Email us) to let us know if you’re blogging about Cato.

Topics:

Weekend Links

  • The Democrats’ ingenious plan to disguise the true cost of their health care bills.

Give Us Your Tired, Your Energetic, Your Poor, Your Rich — Pretty Much Anyone Who’s Not a Criminal or Terrorist

On Wednesday I blogged about how, for the first time in many years — since the last recession — H-1B skilled worker visas remain available despite the hard cap on their number.  In other words, even foreigners respond to market incentives: when there are no jobs, there are fewer immigrants.

I’ve gotten some interesting email in response to that little notice, one of which I post below, along with my paragraph-by-paragraph responses.

Just read your blog entry on the H-1b visa.  The problem is that this visa has been misused by sponsoring companies, suffering from high rates of fraud.  I find it strange that Cato supports (or appears to support) a labor tool that is anything but free market.  The H-1b visa is more of an indentured servant visa program than anything else – where employees must be sponsored by an employer.  Since employees aren’t free to find new jobs or start their own business, it results in a captive workforce who will do whatever the employee asks, even beyond reason.  They won’t bargain for higher wages, quit if mistreated, join unions, or do anything that might result in their immigration status being jeopardized.

Having myself been on H-1Bs with several employers, including Cato, I agree that the program is seriously flawed, in the ways this correpondent describes and in others.  Ideally, people would be able to apply for a work permit — their application gaining more “points,” say, for language, youth, skills, the needs of the economy, or whatever other criteria the political process determines are important — and then not be tied to an employer and have an opportunity to receive permanent residence and eventual naturalization if they pay their taxes, stay out of jail, etc.  Or, indeed, we could admit all people who want to come here (after screening for security, criminal, and health concerns), and give them the same opportunity.  But until we get to that more perfect world, I see no conflict in advocating for a repeal of the H-1B cap or pointing out how this recession shows that immigrants come for jobs, not to leech off our welfare state (if that’s the concern, then wall off the welfare state, not the country) or commit crimes.

One thing not correct in your blog is that H-1b visa holders cannot get a green-card.  They can, unfortunately most of the workers are from India so it is difficult for those workers to get the green-card because of how, numerically, green-cards are issued.  The H-1b visa is a “dual intent” visa meaning there is a path to permanent residence and after 6 years on the visa holders can extend 1 year until their green-card is processed.  Indian workers call it the “green carrot” and relate it to the picture of where the mule driver holds a carrot on a stick in front of the mule to keep him moving.  No matter how hard the mule tries, the carrot gets no closer.

The H-1B’s “dual intent” provision is categorically not a path to a green card.  All it does is, as the correspondent points out, allow the worker to stay in the country during the green card application process.  That process, however, and the substantive requirements for obtaining a green card, is no different for H-1B holders than it is for anyone else.  Indeed, spending five or six years on an H-1B with one employer can be a detriment, inasmuch as that employer’s sponsorship application cannot take into account the skills gained during that time of employment.  And yes, the nationality-based restrictions are also obnoxious.

The primary sponsors of H-1b workers are Indian outsourcing firms.  In short, the visa is used as a tool to send jobs overseas.  People from Cato may not have a problem with that because of their own views on globalization and free trade, but the majority of Americans do.  You guys are notorious at just looking at one half of the equation when it comes to free market practices unfortunately – which is the corporate side.  Yes, corporations can move people around the world using a variety of immigration programs.  But do the people being moved around control their own destinies or are they at the mercy of the corporations?

Cato is not a corporate shill.  Plenty of what we advocate is counter to the expressed preferences of Big [fill in your preferred Villain] because the business community often prefers stability over liberty-enhancing volatility — smaller, secure profits over potentially larger but not-guaranteed ones — and a place at the government subsidies trough over a truly free market.  Moreover, and with much irony, it is the H-1B’s cap and costly bureaucratic processing that has promoted outsourcing — which in and of itself is not problematic for the American economy as a whole — by preventing American firms from bringing Indian (and other) workers here.  And people on H-1Bs are “at the mercy of corporations” precisely because this visa is tied to one employer, as mentioned in the first quoted paragraph above.

Liberty doesn’t just apply to corporations and the narrow objective of free trade.  I just don’t understand how the Cato Institute and all of your intellectuals don’t see through this visa for what it is.  It deprives people of liberty.  Many American workers don’t care that “an Indian” is being deprived of their liberty, but they should if not for moral reasons than for economic reasons.  If I have a worker that I can exploit and pay less, now I have a bargaining tool against the worker I previously could not.  When one man is deprived of their liberty, in a way we all are.

I couldn’t agree more that our current immigration regime benefits nobody — not big business, not small business, not skilled workers, not unskilled workers, not the American economy as a whole, not certain sectors of it — with the possible exception of populist demagogues of both the left and the right.  The answer to that morass isn’t to attack globalization or free trade — which is not a “narrow objective” but a fundamental mechanism for enhancing peoples’ lives all over the world — but to reform our immigration system.

For more on these and related issues, check out these recent studies put out by my colleague Dan Griswold and his trade and immigration policy team:

Government of Continual Failure

The Washington Post is full of so many stories about government failure these days, it’s hard to keep up.

Today, on page A19 we learn about a Small Business Administration subsidy program that has a 60-percent default rate. On the same page, we learn that the U.S. Postal Service will lose $7 billion this year.

Flipping over to page A20, we learn that former New York City Police Commissioner Bernard Kerik is a liar, a tax cheat, and thoroughly corrupt.

Then flip back to A15, and columnist Steve Pearlstein rightly lambastes the latest stimulus scheme from Congress: ”This $10 billion boondoggle is nothing more than a giveaway to the real estate industrial complex.”

Finally, on A14, we’ve got government-owned Fannie Mae losing a colossal $19 billion this year and asking the Treasury for another $15 billion taxpayer hand-out.

The federal government is a mess. Policymakers have no idea what the effects will be when they spend billions on scheme after scheme. Most of them don’t read the legislation, they don’t understand economics, and they never admit mistakes when their schemes almost inevitably fail. Fully 40 percent of the vast federal budget will be debt-fueled this year, but few policymakers seem to care. And public corruption seems never-ending. 

Isn’t it time to give libertarianism a chance?