Immigration Reform Should Include Guest Worker Program And Taxes On Work Visas, Says Economist

By Annie Berman - Talk Radio News Service

At a Capitol Hill briefing held by the Cato Institute Friday, economic experts recommended factors that should be included in immigration reform including a guest worker program, taxes on work visas, and tighter internal enforcement and border security.

Peter Dixon, an economist from Australia who holds a Ph.D. from Harvard University, argued that illegal immigrants who hold low skill, poorly paid occupations are more likely to be unreliable workers than an employee who is a citizen of the U.S.

“The main reason for their productivity being low is their wages. Economic theory suggests that people will be employed up to the point where their wage is equal to their productivity,” Dixon said. “If wages were higher than their productivity, well then they will get fired. If wages are lower than their productivity, then you want more of them...They systematically earn lower wages than legal residents.”

Dixon explained that if the U.S. imposed tighter border security and tighter internal enforcement, it would cost twice as much for an illegal immigrant to cross the border. Therefore, a reduction in the labor force of low skilled, low wage workers would cause vacancies to open up at the top of the job market.

“Border crossing is a dangerous thing to do. You’ve got to give money to smugglers, it might not be successful, you might be sent back home...We’ve built the fence higher in a way that’s equivalent to potential illegals thinking in terms of it costing them an extra $5000 [for example] for a crossing,” Dixon said.

To counteract a reduction in the number of jobs available to citizens, Dixon suggested a guest worker and legalization program wherein employers may obtain visas that are taxed. The taxes from the visas would go to the government and an incentive for employers to higher immigrants that want to work in the U.S. would be created. With a guest worker program, there is the possibility that each guest worker would bring more productivity with them, the economist added.

Dixon explained that the U.S. standard of living will go up because because there would be more productivity, but without any drain on public expenditures due to only a small rise in population. Dixon also made clear that the guest worker program would not be a “path to citizenship”. Immigrants who choose to participate in the guest worker program would simply be guests, not automatic citizens, Dixon said.

“It has to be made completely clear that this is not a path to citizenship. This is a way in which the U.S. gets a job done. It’s like trade. You are importing labor to do a particular job and then go away again. So it’s not meant to be a path to citizenship.”

Experts Advise U.S. To Focus On Relationship With Pakistan’s People

By Annie Berman-Talk Radio News Service

A panel of experts at the Cato Institute said that a key step in strengthening the relationship between Pakistan and the U.S. is to convince the Pakistani people to favor the United States.
“We face a huge obstacle of not really understanding each other and definitely not trusting each other,” said Wendy Chamberlin, the former U.S. Ambassador to Pakistan and President of the Middle East Institute. “We need to help that Pakistanis put human safety and security first, this means a significant investment in local police, community police, because that is where people are protected and through local police you have the better [intelligence] for the kind of insurgencies we are facing.”

According to Chamberlin, peaceful relations between the US and Pakistan could be impeded by a number of other risks including shaky military relations, the role of religion, deadly drone attacks, and a history of miscommunication.

Mukhtar Kahn, an analyst at the Jamestown Foundation, described the Pakistani population as a strong, civil society.

“There is a strong middle class.  Pakistan has a population of 170 million people, and around 60 million people are the middle class.  Most of them are against the Taliban,” said Khan.

“One of the most important things is that Pakistan has a very vibrant media these days. Pakistan has more than 50 independent TV channels...[people] are debating everyday...People are participating in those debates,” Khan added.

In order to improve relations between the U.S. and Pakistan, Kahn suggested increasing public diplomacy, cultural exchange programs, and strategic communication among the Pakistani people regarding the threat of the Taliban.

Pro-Trade Advocates Stress Need For Bipartisan Support

By Learned Foote- Talk Radio News Service

Advocates of free trade argued for reestablishing a bipartisan consensus in favor of open markets during a briefing on Capitol Hill. The panel included Congressman Henry Cuellar (D-TX), founder of the Congressional Pro-Trade Caucus, and Daniel J. Ikenson, Associate Director of the Center for Trade Policy Studies at the Cato Institute. 

"The bipartisan pro-trade consensus which existed after World War II collapsed during the Bush administration," said Ikenson. He said that Democratic support of free trade began to decline in the 1990s. Ikenson cited the political allegiance between the Democrats and advocates for labor and the environment as one influential factor in this trend, but also said that Republican efforts to push through the pro-trade agenda without involving the Democrats sharpened the partisan divide during the Bush years.

Rep. Cuellar argued that both parties should work together to form a consensus. "You have to do it in a bipartisan way, and you got to include the minority from the beginning," he said. "For the Democratic Party, it would be a mistake to turn our backs to trade."  

Ikenson noted that Americans now view trade agreements with increasing disapproval. "America's souring on trade over the past few years is the product of a top-down process," he said. He argued that public opinion is influenced by false myths about free trade, which discount free trade's potential to engender wealth creation and peaceful foreign policy. 

Both Cuellar and Ikenson said that they believed President Obama would sway public opinion by advancing a pro-trade agenda. Cuellar sad that he was worried by some of Obama's campaign rhetoric, which included harsh criticisms of the North American Free Trade Agreement, but has been impressed by Obama's cabinet appointments, including Ron Kirk as United States Trade Representative. "I feel very, very good about President Obama," said Cuellar. 

With health-care reform and global warming bills coming up in Congress, Cuellar said that trade agreements may be put on hold for the summer, in order to avoid splitting the Democratic caucus. He said that he hopes trade agreements will be established with Panama and Colombia before the year is over.

"Spending money I haven't made yet for things I don't want."

Coffee Brown, University of New Mexico, Talk Radio News

Paul Ryan (R-Wis.) said, “The president is proposing to increase our national debt more than all prior 43 presidents combined,” adding $2.3 trillion more “to the national debt in higher deficits” than his own budget office stated.

Ryan said the budget increases taxes and spending. “But what’s so galling about this – we read today the Chinese are talking about a new currency, the Russians are talking about a new currency. We are debasing the value of the American dollar by borrowing way beyond our means,” he said.

“We are consigning our next generation to an inferior standard of living,” Ryan said.

He estimates the national debt will double in six years and triple in ten.

Dan Mitchell, senior fellow at the CATO Institute, a libertarian think tank, said, “That’s just the tip of the iceberg, because … we have trillions and trillions of unfunded liability for entitlement programs, … tens of trillions of dollars of unfunded liabilities in the future. We are in effect on a path to become the next Argentina.”

That other countries would consider a reserve currency other than the dollar is, he says, “a referendum that we are on the wrong track.”

Rep. Jim Jordan (R-Ohio), Chairman of the Fiscal Responsibility Task Force of the Republican Study Committee, said that one of the elements of greatness is the willingness of one generation to sacrifice for the next. The next generation, he said, will never be able to repay this debt.

He quoted Sen. Judd Gregg (R-N.H.) as saying this budget would bankrupt the country.

Rep. Marsha Blackburn (R-Tenn.) said “One of my constituents said it best, ‘I am tired of Congress spending money I haven’t made yet for things I don’t want.’ When you look at the push for nationalizing healthcare, when you look at the cap-and-tax scheme (Cap-and-Trade), this is what people are afraid is going to pile on more and more debt.”

“I look at this as being economic abuse of (her grandchildren’s) future,” she said.

Rep. Gregg Harper (R-Miss.) said, ”When you find out you’ve dug yourself a hole, you should quit digging, but we’ve brought in heavy machinery, and we’re making the hole so deep that we’re not going to be able to get out of it.”

“We tell our children we can’t afford to get everything,” he said, and now the children, the public, are telling the parents, the legislators, “We don’t really have to have that.”

Rethinking Afghanistan

While Iraq has dominated the majority of media and military attention since 2002, the public focus is beginning to shift.

The border between Afghanistan and western Pakistan, a region known as the Federally Administered Tribal Areas that remains ungoverned by either Afghanistan or Pakistan, has been marred with violence and an increase in al-Qaeda and Taliban presence.

"In many of these settled areas relentless Taliban incursion have already lead to the complete collapse of tribal and civilian administration," said foreign policy analyst Malou Innocent at the Cato Institute.

"According to senior U.S. intelligence officials al-Qaida, Taliban, and allied terrorist groups have 157 training camps in the tribal areas alone and more than 400 logistical support locations in the tribal areas and the northwest frontier provence."

The situation in Afghanistan has been strained as well. Current troop levels have been insufficient for restoring security, due in part both by the amount deployed to Iraq and limitations put on NATO troops.

"We have a fair number of NATO forces, some 30,000, but many of them are stationed up North in the country where there is virtually no threat and virtually no fighting...a number of caveats, restrictions, on the use of their forces. Some can not be used at night, some can not be used in combat zones," said vice president of defense and foreign policy studies at the Cato Institute Ted Galen Carpenter.

The drug war has also threatened the chances for stability. While some funding from the international heroin reaches al-Qaida, warlords loyal to Afghanistan President Hamid Karzai and a substantial portion of the general population profit as well. According to Carpenter, these are allies that the U.S. needs to keep.

Still, Carpenter said, even if these problems are addressed it is unlikely that the shape Afghanistan takes will be particularly pleasing to the U.S.

"We have to accept the realities of Afghanistan, of regional power-brokers and less than a western style democracy...the reality is that the Afghan system, such as it was, worked pretty well for a good many decades..."

Carpenter added, "We may even need to see if we can cut a deal with the Afghan Taliban, to divide that fraction from its al-Qaida allies. Much as General Petraeus, rather shrewdly, cut a deal with indigenous Iraqi sunni insurgents to separate them from al-Qaida in Iraq."