Topic: Trade and Immigration

Are We Moving Toward a More Ideological Trade Policy Debate?

By
K. William Watson

With John Kerry leaving the Senate to become Secretary of State, the seat that Kerry held on the Senate Finance Committee will be filled by Senator Bob Casey of Pennsylvania.  This is an interesting committee assignment given that the Finance committee oversees all international trade issues in the Senate and that Senator Casey is one of the most protectionist members of Congress today.  But there is another reason why Casey’s assignment and his voting record are intriguing for the future of trade policy.

The Cato Institute has been keeping track of Congressional votes affecting trade freedom since 1999.  Every member of Congress has a trade vote profile that reveals their support for trade barriers and trade subsidies throughout their career.  The database reveals some interesting facts about members of the Finance Committee, swing states, and ideology.

Pennsylvania and Ohio are both states where neither Republicans nor Democrats hold a stable majority, and indeed there is one Republican senator and one Democratic senator from each.  All four of those senators are now on the Senate Finance Committee.  What’s especially interesting is that the two Democrats—Casey from Pennsylvania and Sherrod Brown from Ohio—are solid Interventionists according to Cato’s trade scoring matrix, while the two Republicans—Pat Toomey from Pennsylvania and Rob Portman from Ohio—can both securely claim the (alas, much-rarer) Free Trader designation. 

The significant disparity in voting records for Senators with the exact same constituents goes against conventional trade-policy wisdom.  Trade barriers often have regional implications so that support for a particular policy will transcend ideology or party affiliation.  Polticians from Maine support shoe tariffs; politicians from Arkansas support catfish restrictions; politicians from Florida support sugar subsidies; politicians from South Dakota support beef restrictions; and so on. 

I find the possibility of a more ideological trade debate refreshing.  Maybe this phenomenon in Ohio and Pennsylvania says more about the electoral peculiarities of swing states than it does about trade policy—all four of these Senators are new comers to their office and were elected in mid-term elections that favored their party.  But if it signals a new trend in how the battle lines of trade policy will be drawn in Congress, the future looks bright.  I’d rather be governed by two principled ideologues with opposing ideas than by two centrists tied to special interests.

Topics: 
Trade and Immigration

America Does Not Have a ‘Genius Glut’

By
Alex Nowrasteh

On Friday, Ross Eisenbrey of the Economic Policy Institute wrote an op-ed in the New York Times titled “America’s Genius Glut,” in which he argued that highly-skilled immigrants make highly skilled Americans poorer. 

A common way for highly-skilled immigrants to enter the United States is on the H-1B temporary worker visa. 58 percent of workers who received their H-1B in 2011 had either a masters, professional, or doctorate degree. The unemployment rate for all workers in America with a college degree or greater in January 2013 is 3.7 percent, lower than the 4 percent average unemployment rate for that educational cohort in 2012. That unemployment rate is also the lowest of all the educational cohorts recorded. 

Just over half of all H-1B workers are employed in the computer industry. There is a 3.9 percent unemployment rate for computer and mathematical occupations in January 2013, and an unemployment rate of 3.8 percent for all professional and related occupations. For selected computer-related occupations from the Bureau of Labor Statistics’ “Quarterly Census of Employment and Wages,” real wage growth from 2001 to 2011 has been fairly steady:   

 

 11 percent of H-1B visas go to engineers and architects but wage growth in those occupations has been fairly steady too:

 

Mr. Eisenbrey concludes that those rising incomes would rise faster if there were fewer highly-skilled immigrants. 

The unemployment rates for engineers and computer professionals are low but not as low as they used to be. There are a whole host of factors explaining that, but highly-skilled immigration is not likely to be one.  

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Topics: 
Trade and Immigration

U.S.-EU Free Trade Agreement? A Pep Talk or Overhaul at USTR Is the Place to Start

By
Daniel J. Ikenson

In its first 49 months, the Obama adminstration has paid lip service to trade liberalization. There have been the announcements, the platitudes, the initiatives, the task forces, and the interminable negotiations, but no new trade agreements. Not one. Still, in his State of the Union speech tonight, the president will offer assurances that his rhetorical commitment to trade liberalization remains steadfast, when he announces grand plans to pursue a trans-Atlantic free trade deal. Of course, rhetorical commitments and pursuing free trade don’t exactly get the job done.

Whether anything comes of prospective U.S.-EU trade negotiations or the still-brewing Trans-Pacific Partnership negotiations depends, more than anything else, on whether President Obama believes his own rhetoric. Of course, actions speak louder than words and on that score things don’t look especially promising.

Exhibit A is the Office of the U.S. Trade Representative, where employee morale has gone from bad to worse. In a 2012 OPM survey of 29 small federal agencies published in a report titled “Best Places to Work in the Federal Government,” USTR ranked dead last. The results showed employee dissatisfaction with their jobs, their organization, and their senior leadership.

The overall weighted index score of 32.7 (out of a possible 100) in 2012 is the latest point in a continuous and steep decline in satisfaction, which was 74.2 in 2009, 57.4 in 2010, and 47.7 in 2011. The sub-index for “Effective Leadership - Senior Leaders” declined from 71.2 to 49.7 to 37.5 to 18.6 over those same four years. Only 17.7 percent of the 101 USTR respondents said they had a high level of respect for their organization’s senior leaders, while 62.1 dissented from that view. Only 12.8 percent of 102 USTR respondents said their organization’s leaders generate high levels of motivation and commitment in the workforce, while 67.3 dissented.

These are some profound rebukes of U.S. Trade Representative Ron Kirk, and by extension, President Obama.

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Topics: 
Trade and Immigration

Live Blog of the 2013 State of the Union Address and the GOP Response

By
Zach Graves

Please join us at 9:00PM ET on Tuesday, February 12, for live commentary during President Obama’s State of the Union address, the GOP response by Sen. Marco Rubio, and the Tea Party response by Sen. Rand Paul. Here is our panel of policy experts by research area:

General Comment and the Presidency:

Banking and Financial Regulation:

  • Mark Calabria, Director of Financial Regulation Studies (@MarkCalabria)

Infrastructure and Fiscal Policy:

Law and Civil Liberties:

Telecom and Information Policy:

  • Jim Harper, Director of Information Policy Studies (@Jim_Harper)

Health Care:

Immigration:

Education:

  • Andrew Coulson, Director - Center for Educational Freedom (@Andrew_Coulson)
  • Neal McCluskey, Associate Director - Center for Educational Freedom (@NealMcCluskey)

Energy and Environment:

  • Patrick J. Michaels, Director - Center for the Study of Science (@CatoMichaels)
  • Chip Knappenberger, Assistant Director - Center for the Study of Science (@PCKnappenberger)

Foreign Policy and National Security:

Follow their comments directly on Twitter, or come back to this page at 9:00 PM ET on Tuesday, February 12, to join us. We look forward to having you, and sharing our insights with you.

You can also follow the conversation on Twitter by following @CatoInstitute and the hashtag #SOTU.

Also watch Cato’s Libertarian State of the Union.

Topics: 
Education and Child Policy, Energy and Environment, Finance, Banking & Monetary Policy, Foreign Policy and National Security, General, Government and Politics, Health Care, Law and Civil Liberties, Tax and Budget Policy, Trade and Immigration

Ed Glaeser Makes Lamentably Rare Case for the Freedom to Trade

By
Sallie James

Support for free trade, especially from politicians, often rests on tired mercantalist arguments about the benefits of exports and jobs. That can backfire, as we’ve seen recently with trade figures showing that the U.S. trade deficit with Korea has widened since the Korea-U.S. Free Trade Agreement came into force. That’s why I’ve argued that relying on rhetoric about all the exports and jobs that free(r) trade will create is a dangerous game: where, might trade skeptics ask, are all those exports you promised us, and why should we support trade liberalization if the results we were promised don’t materialize? So I was thrilled today to see a small post on Bloomberg.com from Harvard economics professor Ed Glaeser calling for the president to make a strong push for a U.S.-EU trade agreement, because of the benefits it would bring U.S. companies and consumers:

He should use his address to make the U.S. a leading voice once again for economic freedom: the freedom of consumers to buy European goods and the freedom of producers to sell their goods on the other side of the Atlantic.

It is gratifying to see a principled case for free trade, resting on a foundation of freedom, in the media. Here’s hoping President Obama read Professor Glaeser’s article, and heeds his advice.

Topics: 
International Economics and Development, Trade and Immigration

Cato Scholars Speaking at Students for Liberty Conference — Join Us

By
David Boaz

The 2013 International Students For Liberty Conference, now in its sixth year, will bring over a thousand students and young liberty activists to Washington, D.C. to talk about ideas, hear from leading policy experts, and network with organizations and each other. I’m proud to have been the first speaker at the first ISFLC conference, in New York in 2008.  This year, the conference will be hosted at the Grand Hyatt Washington Hotel, just three blocks from the Cato Institute.

I will be presenting two lectures that weekend, a session with Young Americans for Liberty on “The Ten Ways to Talk about Freedom” and a luncheon keynote in Cato’s Yeager Conference Center on Reclaiming Freedom: The Case for Libertarian Ideas in Mainstream Politics. Plus I’ll be on a special taping of the “Stossel” show.

Other Cato scholars will be speaking on policy issues throughout the conference.  All of the below sessions will be taking place in the Hyatt’s Constitution room B.

Saturday, February 16
10:00-10:45am Restoring Constitutional Liberty Roger Pilon
11:15-12:00pm Privacy Under Attack Jim Harper
12:10–1:20pm Reclaiming Freedom: The Case for Libertarian Ideas in Mainstream Politics *Luncheon @ the Cato Institute* David Boaz
1:30-2:15pm The Clone Wars: Fighting to Educate Free Individuals Neal McCluskey
2:45-3:30pm A Foreign Policy for Advancing Liberty Abroad (without Undermining It at Home) Christopher A. Preble
4:00-4:45pm Economic Growth and the Future of Liberty Brink Lindsey
5:15-6:00pm How the Government Uses “Science” to Take Away Your Stuff Patrick J. Michaels
     
Sunday, February 17
10:00-10:45am How to Win Every Libertarian Argument Jason Kuznicki
11:15-12:00pm Why Libertarians Should Care Much More about Immigration Alex Nowrasteh

To attend the student luncheon event, please register online or sign up for your ticket at the Cato booth at the conference exhibit hall.

Topics: 
Education and Child Policy, Energy and Environment, Foreign Policy and National Security, General, Government and Politics, Law and Civil Liberties, Political Philosophy, Tax and Budget Policy, Telecom, Internet & Information Policy, Trade and Immigration

Because Nothing Promotes “Social Peace” Like Favors to Special Interests

By
Sallie James

Big Ag’s friends in Congress are no dummies. Even they sense that farm subsidies are distinctly on the nose in these straightened fiscal times. So they are wheeling out that old chestnut about farm subsidies being essential for “national security.” With a dash of social harmony thrown in for good measure. From the Brownfield site yesterday:

In a conference call with reporters Wednesday, [Senator Charles Grassley, R, IA] said a farm bill won’t happen if the legislation is put only in the context of a subsidy to farmers. “We have to start talking in terms of a sure supply of food to make sure that we have social peace in our country,” said Grassley, during the conference call. It is also important for people to know that food is a national security issue, said Grassley, because “an army marches on its stomach.” “All you have to do is look at Germany and Japan,” he added. “Why do they protect their farmers? Because they found out during World War II that if you don’t have food, you can’t fight; and so they’re very protective of their farmers for national defense.” [emphasis added]

Don’t buy what these folks are selling, America. Appeals to national defense are often the third-to-last refuge of the scoundrel (the last being patriotism and the second-to-last “for the children”) and in any case are a red herring when it comes to farm subsidies. No one is going to starve in this country if we get rid of farm subsidies. The Germans and Japanese subsidize their farmers for the same reason we do: because they’re a powerful political force. And as for claims that farm subsidies preserve “social peace”? What absolute rot. Favoring special interests at others’ expense fuels resentment and undermines social harmony.  

Topics: 
Tax and Budget Policy, Trade and Immigration

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