The Government’s Bad Arguments in Defense of Discriminating Against Immigrants Based on Nationality

A federal judge in Seattle paused enforcement of President Trump’s executive order banning almost all immigration from seven countries in the State of Washington v. Donald Trump. The same judge will also hear a lawsuit brought by American Immigration Council (AIC), which makes the argument that I have made here and in the New York Times that the order is illegal as applied to immigrants coming to live in the U.S. permanently.

Washington’s main claims were constitutional, and it sought to have the entire order overturned. Nonetheless, the government did partially respond to the main argument in the AIC complaint, which is:

Section 202(a)(1) of the Immigration and Nationality Act [INA]…expressly provides for the non-discriminatory issuance of immigrant visas; it mandates that, with limited exceptions not relevant here, “no person shall receive any preference or priority or be discriminated against in the issuance of an immigrant visa because of the person’s race, sex, nationality, place of birth, or place of residence.”

[INA section 202(a)(1)] was intended to protect the interests of both U.S. citizen and lawful permanent resident immigrant visa petitioners as well as immigrant visa applicants or holders. The EO discriminates against immigrant visa applicants or holders on the basis of their “nationality, place of birth, or place or residence,” and therefore is discriminatory and violates [INA section 202(a)(1)].

The government responded to these points by pointing to section 212(f) of the Immigration and Nationality Act, which reads:

Whenever the President finds that the entry of any aliens or of any class of aliens into the United States would be detrimental to the interests of the United States, he may by proclamation, and for such period as he shall deem necessary, suspend the entry of all aliens or any class of aliens as immigrants or nonimmigrants, or impose on the entry of aliens any restrictions he may deem to be appropriate.

Resolution of Conflict

There is an apparent conflict between the statutes. In the case of conflict, the rule of construction is 1) “to give effect to each but 2) to allow a later enacted 3) more specific statute to amend an earlier, more general statute,” Smith v. Robinson (1984).

Democrats Should Be Heartened by Betsy DeVos

Unless something unexpected happens, tomorrow the United States Senate will vote on Betsy DeVos to be the next U.S. Secretary of Education. And if you are a Democrat sweating through nightmares over what a Trump administration will do to education, you should be pretty comfy with what DeVos has said she’d like to see happen under her watch. As she stated repeatedly in her confirmation hearing, she would not use federal power—and certainly not secretarial power—to impose anything, including school choice, on unwilling states and districts.

But isn’t the vote expected to be as close as last night’s Super Bowl at the end of regulation, with all Dems voting against DeVos and Vice President Mike Pence delivering the final, overtime vote for her? Yup.

You see, over the decades, Democrats, with copious help from Republicans, have tried to make the U.S. Department of Education what it was not originally intended to be, and what with absolute certainty it cannot constitutionally be: a national school board. This vision was exposed in a comment by Senator Patty Murray (D-WA), ranking member of the Health, Education, Labor and Pensions committee, when she warned all who were suffering through the festival of misinformation and grandstanding that was DeVos’s confirmation hearing, that if approved DeVos would “oversee the education of all of our kids.”

This did not elicit the manufactured giddiness that met DeVos’s suggestion that a school with a grizzly fence might have a gun, and that such decisions should be left to states and communities who know their needs better than Washington. But Murray really ought to know that the Constitution and several laws give the feds no authority to “oversee” American education. Moreover, she had only about a year earlier voted for a law—the Every Student Succeeds Act—intended to cage the education secretary after the Obama administration had employed the position to illegally micromanage American education.

Sen. Murray was, though, soon outdone in her hyperbole. Senate Minority Leader Chuck Schumer (D-NY) took his rightful position in the front of the overstatement pack, declaring that DeVos “would single-handedly decimate our public education system if she were confirmed.”

How, exactly, would she do that?

The Treasury Should Revive the Snow Plan for Limiting GSE Debt Issuance

Despite both the recent release of a set of “GSE reform principles” by the Mortgage Bankers Association and Treasury Secretary Designee Steven Mnuchin’s promise to prioritize reform of Fannie Mae and Freddie Mac, as matters stand such reform seems likely to remain stalled for some time: while there may be a consensus to “do something,” there is far less agreement concerning what that something should be.

To jump start the debate, protect taxpayers, and encourage a more private mortgage market, Mr. Mnuchin, if confirmed, should strongly consider reviving a plan developed by his predecessor, John Snow. That plan would take advantage of the Treasury’s authority to place limits on Fannie and Freddie’s debt issuance to reduce those agencies’ indebtedness. The reduction can and should be done in a controlled manner that could be easily reversed if necessary; a 5 percent monthly reduction, for instance, should work smoothly.

Corporate Tax Cut and Border Adjustment

The House Republican tax plan would cut the federal corporate tax rate from 35 percent to 20 percent, but it would broaden the tax base in a misguided way. It would deny businesses a deduction for their imported inputs to production, but exempt exports from their taxable income.

This base change would raise tax revenues by about $100 billion a year, which is causing major blowback in the business community. It would be a radical change in the structure of business taxes and cause large disruptions in the supply chains and tax liabilities of many firms. No other nation that I am aware of structures their income tax base that way.

I’m for radical change in the tax system, but not radical change that would increase taxes on so many businesses and make the system more complex. Yes, border adjustment would reduce tax avoidance and cut compliance costs related to transfer pricing, but it would create other avoidance and compliance issues by spurring manipulation of imports and exports on tax returns.

Most supporters of border adjustment know that the economics of it are dubious, but support it anyway because it would limit the deficit impact of tax reform. That’s an understandable goal, but there are three better solutions than broadening the tax base in a way that would harm companies.

1) Match a corporate tax rate cut with corporate welfare spending cuts. Romina Boccia, Tom Schatz, and I identify $50 billion in corporate welfare cuts in a new op-ed. And it’s easy to find another $50 billion in cuts in tables 1 and 2 here to match the $100 billion from border adjustment. Unlike the proposed tax base broadening, spending cuts would boost growth by reducing microeconomic distortions caused by federal programs.

Stingray: A New Frontier in Police Surveillance

I’ve written previously on this blog regarding stingray devices: powerful surveillance tools which allow law enforcement agents to spy on the cell phones of unsuspecting Americans, often without judicial or legislative oversight.

For a deeper dive into the subject, I’ve put together a policy analysis detailing the past history, present issues, and future prospects of stingray devices and police surveillance more generally.

From the executive summary:

Police agencies around the United States are using a powerful surveillance tool to mimic cell phone signals to tap into the cellular phones of unsuspecting citizens, track the physical locations of those phones, and perhaps even intercept the content of their communications.

The device is known as a stingray, and it is being used in at least 23 states and the District of Columbia. Originally designed for use on the foreign battlefields of the War on Terror, “cell-site simulator” devices have found a home in the arsenals of dozens of federal, state, and local law enforcement agencies.

Signing the Executive Order to Find Out What’s In It

The flawed implementation of President Trump’s executive order banning immigration from seven majority Muslim countries brings to mind then-Speaker of the House Nancy Pelosi quip about Obamacare that “we have to pass the bill so that you can find out what is in it.” Now it seems President Trump had to sign the order to find out what was in it.

Every day, the president and the administration appears to be discovering new implications of the vague order, and laws are being made up on the fly with press releases and emails, rather than through our country’s democratic process. The executive order purports to “suspend entry into the United States, as immigrants and nonimmigrants… aliens from [seven] countries.” Nearly every word choice leaves room for uncertainty, creating the inevitable confusion and chaos that followed.

Suspend

Consider the first word, “suspend.” Because the order allowed for case-by-case exceptions, no one knows who is actually “suspended” from entering. The administration is only slowly revealing some criteria for these waivers in press conferences and press releases. The exceptions are also apparently not being applied at consulates where a categorical ban on all visa applications and interviews is in effect.

Entry

The second word, “entry,” would seem not to apply to those already inside the United States, yet the administration is applying the ban to them anyway, formulating the policy in an unpublicized email to employees—many of whom were shocked by the announcement.

The US Should Negotiate Trade Agreements with Both the UK and the EU

I recently testified at a joint subcommittee hearing held by the House Foreign Affairs Committee about prospects for a US - UK free trade agreement (my written statement is here).  I focused on the possible content of the agreement.  In my view, the lengthy – and so far unsuccessful – US trade negotiations in the Pacific region (the TPP) and with the EU (the TTIP) are an indication that perhaps we have expanded trade agreements to cover too many issues.  If we want the US - UK trade negotiations to be completed any time soon, we need something more modest, focusing on trade liberalization and doing less global governance.

One issue I did not cover in my written statement, but which came up in the questions during the hearing, was how the US should approach its trade negotiations with the EU after Brexit.  Everyone seemed to agree that the US should pursue a free trade agreement with the UK as soon as permitted (although there are disagreements about when that can occur).  But what should happen to the ongoing trade negotiations with the EU?

The Trump administration has not made any official statement on its view of the TTIP, but there are a couple worrying signs.  First, the Financial Times notes the Trump administration’s preference for bilateral trade deals, and quotes Peter Navarro, the head of the White House National Trade Council, saying that he thinks the TTIP is a multilateral deal:

The new president says he prefers bilateral trade deals rather than the broad multilateral accords pursued by Barack Obama, his predecessor. Mr. Trump last week also withdrew from a 12-country Pacific Rim deal negotiated by Mr. Obama. 

“A big obstacle to viewing TTIP as a bilateral deal is Germany, which continues to exploit other countries in the EU as well as the US with an ‘implicit Deutsche Mark’ that is grossly undervalued,” Mr. Navarro said. “The German structural imbalance in trade with the rest of the EU and the US underscores the economic heterogeneity [diversity] within the EU — ergo, this is a multilateral deal in bilateral dress.”

While this is not a definitive statement of US policy, it may suggest reluctance among some people in the Trump administration to continue the negotiations with the EU.

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