Tag: obama

The Real Climate Terror

The Obama Administration is sticking to its talking points claiming climate change affects us more than terrorism. It might be valuable to compare and contrast the real life affects Americans endure from both of these threats.

First, let’s take a look at climate change’s effects in the United States: Hurricane power, when measured by satellites, is near its lowest ever ebb. There’s no change in the frequency of severe tornados. The relationship between heavy snow and temperature is negative along the East Coast. Carbon dioxide and longer growing seasons are significantly increasing the world’s food supply, and there’s no relationship between global temperature and U.S. drought.

Compare this with the effects of terrorism: On September 11, 2011, terrorists took down the World Trade Center and nearly an entire side of the Pentagon, extinguishing 2,996 lives. As a result, every American’s privacy is assaulted by the government on a daily basis—and let’s not talk about what they’ve done to air travel, or worse, Iraq. We’ve managed to remain in a perpetual state of war, unleashing a wave of federal spending our great grandchildren will be repaying.

Perhaps next time President Obama skips the TSA lines to fly around the world on Air Force One (on the taxpayer dime, emitting the carbon of which he’s so scared) he should look down at Arlington National Cemetery at the tombstones left from the reaction to terrorism–it’s an excellent reminder of the real cost of government action.

(Read more about actual threat of terrorism in “Terrorizing Ourselves,” by Benjamin Friedman, Jim Harper and Christopher Prebel, and “Responsible Counterterrorism Policy,” by John Mueller and Mark Stewart.)

Removing EITC and Child Tax Credits for DACA/DAPA recipients and Non-Citizens

President Obama’s executive actions on immigration, known as the Deferred Action for Parents of Americans and Lawful Permanent Residents (DAPA) and the Deferred Action for Childhood Arrivals (DACA), have allowed those beneficiaries to retroactively receive Earned Income Tax Credits (EITC) and Child Tax Credits (CTC).

The DACA and DAPA programs grant recipients temporary work permits during the period of their deferred action.  Under current legislation, CTC eligibility is determined through either a Social Security Number (SSN) or an Individual Taxpayer Identification Number (ITIN).  Since many unauthorized immigrants are already issued ITINs, eligibility for the CTC is not much affected by DACA and DAPA.

EITC eligibility status is another story altogether, as currently only those who file taxes with a valid SSN are eligible to receive the benefits.  DACA and DAPA will allow those recipients to apply for an SSN, thereby making them eligible for EITC benefits.  Another IRS rule allows those recipients to retroactively claim EITC benefits for previous years in which they were not in the country legally.  Under current law, taxes can be filed retroactively for up to three years by using the 1040X Amended Tax Return Form.  Because DACA and DAPA recipients are eligible for SSNs, they are able to file amended tax returns, making many eligible for EITC benefits in previous years.

The EITC is known as a refundable tax credit, meaning that low-income families can receive a tax “refund” that is larger than their original tax liability.  The program has become notorious for fraudulent and improper payments, yet the IRS has not enacted systematic reforms.  According to a report by the Treasury Inspector General, the IRS paid out $63 billion in EITC payments in 2013 alone – $15 billion of which were given to people ineligible to receive EITC benefits.  Of that $63 billion, only $8 billion were actual tax cuts and $55 billion were payments.

Non-citizens should be ineligible for means tested welfare benefits, the EITC, and CTC.  Walling off welfare benefits is the best option after scaling the benefits back or removing them for everybody.  Here is our previous work on how to build a wall around the welfare state.  Since I did not consider the EITC in my original Cato policy analysis on how to wall off welfare benefits to non-citizens, these are the specific laws that would need to be amended to correct this.

Reforming Section 32(c)(1)(E) of the Internal Revenue Code of 1986 delineates the eligibility for EITC benefits. The language in subsection (1) determines eligibility.  Changing the statute there could eliminate the ability for newly legalized immigrant workers to retroactively file for EITC benefits.  This section could also be amended to deny the EITC to non-citizens broadly, but that is more complex as SSNs are granted to some non-citizens.  A citizenship requirement for EITC would still decrease the outlays. 

CTC should also be denied to those who had their deportations deferred. CTC eligibility requirements are included in Section 24 of the Internal Revenue Code of 1986.  Denying CTC benefits for previous years when the tax filer was ineligible for such benefits was actually proposed in Congress last year – here is the text of that bill.  If possible, CTC benefits should be reserved for citizens only (if we can’t get rid of them altogether).

Immigration is a huge economic net-positive for the United States and fiscally neutral in the long run.  Poor immigrants generally underuse means-tested welfare compared to poor Americans.  Immigrants broadly subsidize the entitlement programs.  Regardless, tax credits should not be retroactively available to immigrants who have had their deportations deferred nor should non-citizens have access at all.

Fiscal conservatives can use immigration as an argument in favor of restricting welfare and EITC benefits.  That would be a far more effective and conservative use of their time than using the welfare state as an argument against liberalized immigration.       

Selling Trade Liberalization Like the Measles Vaccine

President Obama is presiding over what may prove to be the most significant round of trade liberalization in American history, yet he has never once made an affirmative case for that outcome. Despite various reports of intensifying outreach to members of Congress, the president’s “advocacy” is couched in enough skepticism to create and reinforce fears about trade and globalization.

Politico reports:

On Tuesday, Obama sent a letter directly to Rep. Ruben Gallego (D-Ariz.), arguing that reaching new trade agreements is the only way to stop China from dominating the global markets and letting its lax standards run the world.

“If they succeed, our competitors would be free to ignore basic environmental and labor standards, giving them an unfair advantage against American workers,” Obama wrote Gallego in a letter obtained by POLITICO. “We can’t let that happen. We should write the rules, and level the playing field for the middle class.”

Certainly, playing the China card could help win support for Trade Promotion Authority and, eventually, the Trans-Pacific Partnership, but it needn’t be the first selling point.  Pitching trade agreements as though they were innoculations from an otherwise imminent disease betrays a profound lack of understanding of the benefits of trade. With TPP near completion and the Transatlantic Trade and Investment Partnership talks expected to accelerate, the president’s stubborn refusal to make an affirmative case for his trade initiatives to the public and the skeptics in his party is disconcerting. Bill Watson was troubled by the president’s feeble advocacy of trade liberalization in his SOTU address.

The State of the Union: Please, Just Do No Harm

At the National Interest, I critique the president’s State of the Union speech:

Instead, we got a sweeping vision of a federal government that takes care of us from childhood to retirement, a verbal counterpart to the Obama campaign’s internet ad about “Julia,” the cartoon character who has no family, friends, church or community and depends on government help throughout her life. The president chronicled a government that provides us with student loans, healthcare, oil and the Internet.

The spirit of American independence, of free people pursuing their dreams in a free economy, was entirely absent. Indeed, the word “freedom” appeared only once in the speech.

I wasn’t so impressed with the “middle-class economics” he laid out:

The president wants more and better jobs. And yet he wants to raise taxes on the savings and investment that produce economic growth and better jobs. And he proposes a higher minimum wage, which would cost some low-skilled workers their jobs. Those proposals are not well thought out….

The president spoke a lot about the future. He mentioned Social Security, Medicare and Medicaid. And he twice boasted of shrinking deficits. But he never addressed the elephant in the room: The deficit is about to head back up, reaching $1 trillion in a few years. The national debt is $18 trillion and still growing. Worse, those entitlements programs have an unfunded liability of around $90 trillion. What’s his plan to avert an unprecedented financial crisis a few years after he leaves office? He didn’t say, because he has no plan.

Things got a little better when he turned to foreign policy:

When he turned from economics, the president offered a bit more to libertarian-minded voters. He said that we don’t want to be “dragged into costly conflicts that strain our military and set back our standing” or “dragged into another ground war in the Middle East.” He said that “when the first response to a challenge is to send in our military, then we risk getting drawn into unnecessary conflicts, and neglect the broader strategy we need for a safer, more prosperous world.” Music to noninterventionist and realist ears.

But the reality is somewhat different. He has officially ended the wars in Afghanistan and Iraq, but American troops remain in both countries, which are hardly experiencing postwar tranquility. He has bombed seven countries, three more than President Bush. We are getting more deeply entangled in a new war in Iraq and Syria, without congressional authorization. Obama asked Congress to “pass a resolution to authorize the use of force against ISIL. We need that authority.” Really? He hasn’t shown any need for it these past six months. Nor did he ask for authorization to wage war in Libya. The senator who said in his 2008 campaign, “The President does not have power under the Constitution to unilaterally authorize a military attack in a situation that does not involve stopping an actual or imminent threat to the nation,” has become a president who acts as if he does.

I also found an opportunity to praise his promises on Cuba, criminal justice reform, and the dignity of every citizen. But I concluded:

Early in the speech the president said, “We need to set our sights higher than just making sure government doesn’t screw things up, the government doesn’t halt the progress we’re making. We need to do more than just do no harm.” Please, just do no harm. Americans will make plenty of progress if government doesn’t interfere. 

TONIGHT: Cato Scholars Live-Tweet the State of the Union


Tonight at 9 p.m. EST, President Obama will lay out his plans for the upcoming year in his sixth annual State of the Union (SOTU) address. What will the President’s words mean for liberty? 

Find out tonight: Cato scholars will be live-tweeting their reactions to what the president says—and what he leaves out. Following the President’s address, stay tuned for commentary on the Republican and Tea Party responses. Featured scholars will include everyone from David Boaz to Mark Calabria, Walter Olson to Alex Nowrasteh….and many, many more.

This is your chance to ask the experts what to expect from the policy world in 2015—and to add your two cents to the discussion. Follow @CatoInstitute on Twitter and join the conversation using #CatoSOTU

The Auto Bailout Warrants No Pride, Mr. President

President Obama is in Michigan today, which means his handlers at the White House recently consulted their very thin manila file folder labeled “Economic Successes or Anything That Might Pass for Such” to cull talking points about the auto bailout. Of course, nothing has been more celebrated as an economic policy success of this administration by this administration than the “rescue” of GM and Chrysler.
I spent a good deal of time in 2008-2010 analyzing, commenting, and testifying about the collateral damage–the often unseen but important externalities and longer term costs–that was being inflicted on third parties, the U.S. economy, and the rule of law, all for the purpose of ensuring that specific interests were insulated from the consequences of their behavior. So let me just summarize by repeating some previous thoughts.
It is galling to hear the auto bailouts characterized as “successful.” The word should be off-limits when describing this unfortunate chapter in U.S. economic history. GM and Chrysler, through their own relatively poor decisions with respect to labor contracts, product offerings, and quality management, failed by the market’s judgment and were rightful candidates for downsizing or liquidation. The bailouts essentially deprived the better auto companies of the spoils of competition and forestalled a capacity reckoning, which meaning that in the years ahead, auto workers in Alabama, Tennessee, South Carolina, Indiana, and even Michigan and Ohio may lose their jobs because GM and Chrysler were propped up beginning in 2009.
Calling the bailouts “successful” is to whitewash:
  • the diversion of funds from the Troubled Assets Relief Program by two administrations for purposes unauthorized by Congress;
  • the looting and redistribution of claims against GM’s and Chrysler’s assets from shareholders and debt-holders to pensioners;
  • the use of questionable tactics to bully stakeholders into accepting terms to facilitate politically desirable outcomes;
  • the unprecedented encroachment by the executive branch into the finest details of the bankruptcy process to orchestrate what bankruptcy law experts describe as “sham” sales of Old Chrysler to New Chrysler and Old GM to New GM;
  • the costs of denying Ford and the other more deserving automakers greater market share and access to GM’s and Chrysler’s best workers and capital;
  • the costs of insulating irresponsible actors, such as the United Auto Workers, from the outcomes of an apolitical bankruptcy proceeding, and;
  • the diminution of U.S. moral authority to counsel foreign governments against similar market interventions, to name some.
Acceptance of the president’s claim of auto bailout success demands profound gullibility or willful ignorance and virtually guarantees similar interventions in the future. 

Interpreting the New Deportation Statistics

Shortly before Christmas the Department of Homeland Security (DHS) released a report detailing deportations (henceforth “removals”) conducted by Immigration and Customs Enforcement (ICE) during fiscal year 2014.  Below I present the data on removals in historical context – combined with information from the Migration Policy Institute and Pew.  See my previous writings on this topic here and here.       

ICE deported 102,224 unauthorized immigrants from the interior of the United States in 2014, down from a peak of 188,422 in 2011.  Removals from the interior are distinct from removals of recent border crossers.  Removals from the interior peaked during the Obama administration and have since fallen to a level equal to that of 2007. 

Source: MPI and DHS.

The number of interior removals under the last six years of the Bush administration (the first two years are unavailable so far) was about 475,000.  From 2009-2014, the Obama administration removed about 950,000 from the interior of the United States.  

President Bush’s administration removed an average of about 276,000 unauthorized immigrants per year for the years available and an average of 79,000 of them annually were interior removals.  President Obama’s administration has removed an average of 405,000 unauthorized immigrants a year, an average of 158,000 of them annually were interior removals.  There were a large numbers of unknowns during the Bush administration that decreased as the years progressed. 


Source: MPI and DHS.

The Obama administration’s recent decrease in the number of interior removals is not the whole story.  The best way to measure the intensity of immigration enforcement is to look at the percentage of the unauthorized immigrant population removed in each year.  Based on estimates of the total size of the unauthorized immigrant population, 0.89 percent of that population was removed from the interior of the United States in 2014 – down from 1.15 percent in 2013. 


Source: MPI, Department of Homeland Security, Pew, Author’s Calculations. 

For every year for which data was available, the Bush administration removed an average of 0.7 percent of the interior unauthorized immigrant population.  President Obama’s administration has removed an average of 1.39 percent of the interior unauthorized immigrant population every year of his presidency – about twice the rate as under the Bush administration.  Even when focusing on interior removals, President Obama is still out-deporting President Bush based on the data available.

The unauthorized immigrant population increased under the Bush administration from 9.4 million in 2001 to a peak of 12.2 million in 2007 and then declined to 11.7 million in 2008.  During Obama’s administration, the number of unauthorized immigrants has, so far, stayed at or below 11.5 million.    

Obama’s interior removal statistics show a downward trend beginning in 2012 through to 2014.  The Obama administration has also focused immigration enforcement on criminal offenders (not all unlawful immigrants are criminals) but the data is a little difficult to disentangle for 2014 so I left it out of this blog post – stay tuned for a future one on that topic. 

The Obama administration has clearly not gutted interior immigration enforcement as their 2014 figures for interior removals are higher than they were for every year of the Bush administration except for 2007 and 2008.