Archives: 08/2016

Latinos Are Twice As Likely to Support the Libertarian Candidate

Whenever I write about immigration from Latin America, I am deluged with complaints that regardless of the economic or social benefits, Latinos are anti-libertarian “socialists.” But a new Fox News Latino poll shows something else. The libertarian presidential candidate Gary Johnson does nearly twice as well among Latino Americans as among the general public—16 percent compared to 8 percent.

Far from being socialists, a wide range of evidence shows that on average, Latino views track libertarian views as closely as any other demographic. This is not to say that Latinos are libertarians overall, but that they are just as open to the libertarian perspective as anyone else.

As my colleague Emily Ekins has pointed out, libertarians are more racially and ethnically diverse than some people believe. Pew also found in 2014 that just as many Latinos identify as libertarian and understand it as a “belief in limited government” as all Americans (11 percent for both). In 2015, Ekins found that averaging nine polls conducted by Reason-Rupe and Cato-YouGov, Latinos make up 14 percent of self-identified libertarians, while being 13 percent of the U.S. population.

Given that Latinos are already least likely to identify as a Democrat or Republican, Latinos’ disproportionate support for a libertarian option in this election makes sense. Currently, they are stuck between a party led by a president who has deported more of their relatives than any other and one led by a candidate who thinks that wasn’t good enough. By contrast, Johnson has adopted the most pro-immigration position of any in this election—not only favoring legalization for those already here but also open legal immigration in the future with Mexico—and he mentions the issue in every television interview.

But Latinos are open to the libertarian option because they side with libertarians on a variety other issues as well.

You Ought to Have a Look: Natural Climate Variability

You Ought to Have a Look is a feature from the Center for the Study of Science posted by Patrick J. Michaels and Paul C. (“Chip”) Knappenberger. While this section will feature all of the areas of interest that we are emphasizing, the prominence of the climate issue is driving a tremendous amount of web traffic. Here we post a few of the best in recent days, along with our color commentary.

We’ve got a lot cover this week, so let’s get right to it.

On the science front, we want to highlight two new papers that both suggest that attributing heavy precipitation events in the United States to human-caused climate change is a fool’s errand (not that there aren’t plenty of fools running around out there). This is a timely topic to explore with the big rains in Louisiana over the weekend leading the news coverage.

One paper by a research team from the University of Iowa found that “the stronger storms are not getting stronger” and that there has not been any change in the seasonality of heavy rainfall events by examining trends in the magnitude, frequency, and seasonality of heavy rainfall events in the United States. They did report that the frequency of heavy rain events was increasing across much of the United States, with the exception of the Northwest. As to the reason behind the observed patterns, the authors write “[o]ur findings indicate that the climate variability of both the Atlantic and Pacific Oceans can exert a large control on the precipitation frequency and magnitude over the contiguous USA.”

The other paper, from a research team led by NOAA/GFDL’s Karin van der Wiel, examined climate model projections and observed trends in heavy precipitation events across the United States and concludes:

Finally, the observed record and historical model experiments were used to investigate changes in the recent past. In part because of large intrinsic variability, no evidence was found for changes in extreme precipitation attributable to climate change in the available observed record.

Pretty emphatic and straightforward summary.

So, the next time you read that such and such extreme precipitation event was made worse by global warming, you’ll know that there is precious little actual science to back that up.

Trump Supporters Are Not the Losers from Globalization

A common narrative we hear from the news media this election cycle is that Donald Trump has become popular by tapping into anti-trade sentiment among blue collar workers “on the losing side of trade globalization.”  The basic premises of this narrative are that (1) trade has harmed a large segment of the U.S. population and (2) those people are voting for Trump.  But neither one of those premises is true.

The narrative has been fueled by a paper released earlier this year by economist David Autor, David Dorn, and Gordon Hanson titled “The China Shock: Learning from Labor Market Adjustment to Large Changes in Trade.”  The paper has gotten a lot of attention from people on all sides of the trade policy debate.

The key finding of the paper is best summarized by this sentence from the abstract: “At the national level, employment has fallen in U.S. industries more exposed to import competition, as expected, but offsetting employment gains in other industries have yet to materialize.”  The idea is that trade with China has been so disruptive that many people who lost their jobs due to increased imports from China have not been able to find new work. 

Last week, the Wall Street Journal posted a long article tying the picture painted by the Autor, et al. paper to “disillusionment with globalization” and ultimately support for Donald Trump. 

What happened with Chinese imports is an example of how much of the conventional wisdom about economics that held sway in the late 1990s, including the role of trade, technology and central banking, has since slowly unraveled.

The aftershocks are sowing deep-seated political discontent this election year. Disillusionment with globalization has fed one of the most unconventional political seasons in modern history, with Bernie Sanders and especially Donald Trump tapping into potent anti-free-trade sentiment.

It’s understandable that journalists would be attracted to the idea that Trump’s rise fits into broader storylines about economic change and inequality.  But there are a number of reasons why the narrative just doesn’t make sense. 

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The Economics of Trade: Wilbur Ross Is Mistaken

Billionaire investor Wilbur Ross, a supporter of Donald Trump, made the following comment in a letter to the Wall Street Journal (Aug 15): “It’s Econ 101 that GDP equals the sum of domestic economic activity plus “net exports,” i.e., exports minus imports.  Therefore, when we run massive and chronic trade deficits, it weakens our economy.”

In reality, the last sentence –beginning with “Therefore”– does not follow from the first.

Mr. Ross is alluding to the demand side of National Income Accounts, wherein Y=C+I+G+ (N-X). That is, National Income (Y) equals spending on Consumption (C) plus Investment (I) plus Government (G) plus Net Exports (Imports N minus Exports X).  

Taking such accounting too literally, a reduction in imports may appear to be mathematically equal to an increase in overall real GDP.  But that is dangerously incorrect, as the 1930s should have taught us.

The accounting is true by definition (a tautology). But economics is about behavior, not accounting identities.

If trade deficits “weaken our economy,” as Mr. Ross asserts, then we should expect to see real GDP slow down when trade deficits get larger and see real GDP speed up when trade deficits get smaller or become surpluses.  What the data show is much different – the exact opposite in fact.  

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The Surge in Naturalizations Is Exaggerated

Writers across the political spectrum claim that immigrants are naturalizing at a higher rate to vote against Donald Trump in the 2016 presidential election.  No doubt some lawful permanent residents (LPR) are naturalizing in order to vote against Trump, who has made his anti-immigration position a major component of his campaign, but the annualized number of petitions filed in the first two quarters of FY 2016 don’t show a big increase over 2015 (Figure 1).

Figure 1

Naturalization Petitions Filed Annually

 

Source:  DHS & USCIS.

The Migration Policy Institute notes that the number of FY2016 naturalization petitions filed through March is up 21 percent over the same time in FY2015.  If that holds until the end of the year, then there will be about 164,000 additional naturalizations compared to 2015.  The annual standard deviation for naturalization petitions filed from 2008-2015 was about 121,000. So, although FY2016 petitions are likely to exceed those of FY2015 by more than a standard deviation, it pales in comparison to increases in previous years.    

A better measurement is the annual number of petitions filed as a percent of all eligible LPRs. Department of Homeland Security reports provided most of the numbers while I had to make some estimates for the years 2014-2016 based on trends. According to this rough measurement, the annualized number of FY2016 petitions is only slightly above those of 2015 and below that of 2012 (Figure 2).

Figure 2

Naturalization Petitions Filed as a Percent of All Eligible LPRs

 

Sources: DHS & Author’s Estimates for 2014-2016.

The 2007 spike was caused by people filing their petitions before an 80 percent increase in naturalization fees went into effect. 

Surges in naturalization petitions have occurred in the past, particularly as a result of the enforcement propositions in California in the mid-1990s and after the Reagan amnesty. Although 2016 naturalization petitions are up, reports of a massive surge are exaggerated.         

Missile Accident Reminds U.S. of Dangers of Taiwan Commitment

Taiwan long has been one of the globe’s most dangerous tripwires. Other than a brief period after World War II, the island has not been ruled by the mainland for more than a century. The 23 million people living on what was once called Formosa have made a nation.

However, the People’s Republic of China views Taiwan–also known as the Republic of China (ROC)–as part of the PRC. As China has grown wealthier, it has created a military increasingly capable of defeating Taiwan.

At the same time, economic ties between the two nations have grown, yet the Taiwanese population has steadily identified more with Taiwan than the PRC. The election of Tsai Ing-wen of the traditional pro-independence Democratic Progress Party as president in January greatly discomfited Beijing.

School Choice Lawsuits Update: Summer 2016 Edition

As school choice wins in the court of public opinion, opponents have resorted to fighting it in the courts of law. Here are a few brief updates regarding pending lawsuits against school choice programs around the country.

Colorado: Douglas County’s School Choice Grant Program

Last summer, the Colorado Supreme Court struck down Douglas County’s school voucher program with a plurality ruling that the law violates the state’s historically anti-Catholic Blaine Amendment, which forbids public money from being used at religious schools. District officials responded to the ruling by creating a new voucher program that excludes religious schools, which drew lawsuits from both opponents and supporters of school choice.

The Institute for Justice, which had previously defended the school voucher program, sued the county for unconstitutionally discriminating against religious groups. According to IJ, the “exclusion of religious options from the program violates the Free Exercise, Establishment, Equal Protection, and Free Speech Clauses of the United States Constitution, as well as the Due Process Clause, which guarantees the fundamental right of parents to control and direct the education and upbringing of their children.” IJ contends–correctly, in my view–that the First Amendment requires the government to be neutral both among religions and between religion and non-religion, but it may not actively favor nor discriminate against either religious or non-religious groups or institutions. This case is still pending.

In a separate lawsuit, opponents of school choice contended that the new voucher program was not materially different than the old one. Earlier this month, a district court agreed, striking down the program yet again. Although by excluding religious schools, the new program appears to be in compliance with the Colorado Supreme Court’s ruling, the district court explained that the state supreme court did not rule on the merits of several other alleged violations of state constitutional provisions under which the district court had previously invalidated the program. This case is likely going to return to the state supreme court for resolution.

Florida: Tax-Credit Scholarships

There are currently two lawsuits pending against Florida’s tax-credit scholarship program. As RedefinED reports, a judge recently denied an attempt to fast-track one of the two suits, which primarily concerns the adequacy of the state’s funding of district schools. A judge dismissed the portion of the suit related to the tax-credit program but plaintiffs filed an appeal and asked for the case to skip the appellate court and go straight to the state supreme court. That request has been denied, so the case will go before the appellate court first. That means the program is likely to serve more than 100,000 students by the time it comes before the state supreme court.