Category Archives: Politics

Scott Walker the socialist (on immigration)

Last month, Scott Walker explained to conservative talk-show host Sean Hannity that immigration policy should be based, first and foremost, on “protecting American workers and American wages.”

The next president and the next Congress need to make decisions about a legal-immigration system that’s based on, first and foremost, on protecting American workers and American wages. It is a fundamentally lost issue by many in elected positions today, is what is this doing for American workers looking for jobs, what is this doing to wages, and we need to have that to be at the forefront of our discussion going forward.

Presumably, he means that immigration drives down wages and hurts Americans in low-wage jobs. At least, that’s what any intelligent person should take away from such comments. I suspect he’ll deny he said all this in the coming months.

But even so, I’m not content to believe this is his actual view. That’s changed a few times in past years. For all the good he’s done in Wisconsin, Walker’s sure panders hard when faced with the prospect of a presidential campaign.

All that aside, though, what frustrates me most about this has nothing to do with Walker himself, but with the blatant, ignorant stupidity of such a view—the idea that immigrants drive down wages and hurt lower-class Americans and that we need government to make sure this doesn’t happen.

I’ve written about all this before after David Brat made a similar argument last year. He was just as wrong. I’m not going to rehash my whole argument here (you should read it, though), but here’s a few quick questions for Walker:

  1. Why is it bad that immigrants drive down wages? Isn’t it good to have a flexible and diverse supply of labor?
  2. Socialists have, for a century, made the same argument you’re making. Are they wrong? Are you a socialist on immigration?
  3. Instead of limit immigration, why not raise minimum wage by a few dollars? It will have the same effect—it will keep wages high and make many illegal immigrants virtually unemployable.

In case anyone doesn’t get me, I’m not arguing in that third question that minimum wage is good. Minimum wage is bad (as I explained here), and I think Walker would at least lend lip service to that idea. I only frame the question that way to show that Walker is all confused.

In this vein, here’s a great meme I came across today. Pardon the French.

Louis C.K. on

A new piece, and a great interview

Here’s my new piece at EnhancingCapital.com on interest-sensitive investments — a handy little read, I hope, for anyone concerned about how an interest rate hike might affect their portfolio. Then again, I still stand by my prediction from last December: The Fed won’t raise interest rates in 2015. Inflation is just too low. In fact, I don’t think raising rates in 2015 was ever a serious possibility when rate-hike-talk began last fall.

Switching gears…

Here’s a great interview with some great thoughts on immigration (and other things) from someone who could very well be the next President of the U.S. At the least, it’s encouraging to know that someone running for president actually believes his message is robust enough to convince millions of people (i.e. Republicans) that they are wrong on a big issue (immigration).

How Americans change their mind

From Alex Tribou and Keith Collins at Bloomberg Business on Sunday:

Social change in the U.S. appears to follow a pattern: A few pioneer states get out front before the others, and then a key event—often a court decision or a grassroots campaign reaching maturity—triggers a rush of state activity that ultimately leads to a change in federal law.

This is how fast America changes its mind

Jeb Bush speaks truth on immigration

“It just seems to me that maybe if you open up our doors in a fair way and unleashed the spirit of peoples’ hard work, Detroit could become in really short order, one of the great American cities again. Now it would look different, it wouldn’t be Polish…But it would be just as powerful, just as exciting, just as dynamic. And that’s what immigration does and to be fearful of this, it just seems bizarre to me.”-Jeb Bush

What the others are saying

Here’s a quote from a speech given by Russian Foreign Minister Sergey Lavrov last Saturday at the XXII Assembly of the Council on Foreign and Defense Policy in Moscow. I’m posting this because it’s helpful to broaden our horizons every once in a while with regard to where we get our news. This speech has some significant implications for understanding how Russian officials view U.S. foreign policy, and even perhaps what actions the Russian government might take in the future. Yet I’ve seen no mention of the speech on mainstream U.S. outlets.

Many reasonable analysts understand that there is a widening gap between the global ambitions of the US Administration and the country’s real potential.

…

In attempting to establish their pre-eminence at a time when new economic, financial and political power centres are emerging, the Americans provoke counteraction in keeping with Newton’s third law and contribute to the emergence of structures, mechanisms, and movements that seek alternatives to the American recipes for solving the pressing problems. I am not referring to anti-Americanism, still less about forming coalitions spearheaded against the United States, but only about the natural wish of a growing number of countries to secure their vital interests and do it the way they think right, and not what they are told “from across the pond.”

It’s worth noting that perspectives like these aren’t totally absent from mainstream punditry in the U.S. Libertarians, for one, have long warned about the dangers of stretching American resources too thin in pursuit of foreign policy initiatives that don’t have immediate national security implications. Politicians like Rand Paul have even brought hints of such sentiments into the mainstream.

But this is still a far cry from what most Americans consider an “orthodox” perspective on U.S. foreign policy, even if most people agree we’re overextended in many world arenas. The whole thing reminds me of perennial debates about government spending cuts—nodding at mention of the need for spending cuts, cringing when someone tries to actually carry them out.

I realize I’m being quite general, here. I’m no expert on U.S. foreign policy. I simply think it’s worthwhile, in any setting, to hear alternative views—reasonable perspectives that might be habitually ignored by the bigger voices in town.

Reagan on immigration

Rather than talking about putting up a fence, why don’t we work out some recognition of our mutual problems? Make it possible for them to come here legally with a work permit, and then, while their working and earning here, they pay taxes here. When they want to go back, they can go back. They can cross. Open the border both ways.
Ronald Reagan, 1980

Video here.

Stick to the budget

Jorg Guido Hulsmann writing in today’s Mises Daily:

But it’s not sufficient that the people tell government officials what they should be doing. It is equally important, if not more important, to dictate how much money the government will have to achieve those ends. So, it is not enough to tell the government that it will only protect private property. This mandate could be pursued with $100,000 or a billion dollars depending on what the people are willing to pay. So if the budget is not controlled, a limited mandate in itself offers no limitation on taxation or how much money is spent.

Ben Carson is confused

Ben Carson is confused. I’ll leave the details up to Matt Welch at Reason.com. I’ve long been suspicious of Ben Carson. He seems to have good intentions, but that doesn’t make up for his rather disturbing comments about how economies work. He’d probably make a nice dinner guest, but he’s not someone free market fans should want in the White House.

What 1920 means for today

I got published today at Values & Capitalism. Topic is the election of 1920 and why American voters aren’t as hopeless as some pundits might say. In 1920, they voted for deflation and extreme austerity in the form of Warren G. Harding. His acceptance speech at the Republican National Convention called for “thrift and economy, for denial and sacrifice if need be, for a nationwide drive against extravagance and luxury, to a recommittal to simplicity of living, to that prudent and normal plan of life which is the health of the republic.”

Hardly words we’d expect to hear from a winning candidate today. But perhaps last week was a referendum of sorts on unconstrained government and reckless spending. Maybe politicians would do well to start talking like this more often. Forget what the media might make of such sentiments—history shows that ideas like this can be popular.

Public choice is arrogant

I’m reading through Randy Simmons’ Beyond Politics: The Roots of Government Failure for my Microeconomics class. You could call it a primer on public choice.

I’m skeptical of public choice. Most public choice literature I’ve read makes big assumptions about the nature and strength of people’s incentives—a logical jump I’ve written about before.

Much to my surprise, this book has actually increased my skepticism. It’s chock full of assumptions about how people respond to incentives, and makes everything worse by using these assumptions to build an entire theory of how politics works.

For example, consider the following claim made in Chapter 3 of the book:

If a politician has a choice of dividing a million dollars equally among a million citizens or equally among a thousand people she will rationally opt for the later option because she is more likely to win the gratitude of those who gained $1,000 than of those getting but one dollar apiece.

I hope you see the problem. Simmons can’t possibly know this is true. In fact, I’d bet it’s not true. Voters rarely vote according to whether or not a politician helped them personally. They look at how a candidate has changed things overall—how their constituency has performed under his or her supervision. Sure, getting a check for $1,000 might change that, but very few people get such handouts or receive significantly more favors than the average voter. And besides, even those voters who do receive handouts also have the politician’s general economic policies to consider—policies that can have just as big, if not a bigger, influence on their personal financial success.

But whether this is or isn’t true isn’t what matters. Where this analysis is flawed–even dangerous–is when it’s passed off as settled fact and not as theory.

Simmons could just as easily assert something along these lines: If a politician has a choice of dividing a million dollars equally among a million citizens or equally among a thousand people, she will rationally opt for the former option because voters generally despise interest-group pandering and she’d risk losing more votes than she’d gain.

He didn’t, though, because that’s not how he predicts these particular incentives would operate. But his prediction is imperfect. Other theorists hold different views. Therefore, his claim shouldn’t be leveled as “she will rationally opt for the latter,” as if there’s no question. Instead, he should add a disclaimer noting his big assumption about how voters would respond to such an event.

In a word, I guess my problem with public choice is it’s arrogance. It’s the type of arrogance that often gives economists a bad name. Arrogance to think that consumer preferences can be known beyond the fact that they prefer what will satisfy their ends. Arrogance to think that this or that policy will result in this or that outcome without any degree of uncertainty.

As I’ve written before, the fact that any politician was ever re-elected who actually reduced spending, cut taxes, ignored special interest lobbyists and trimmed down bureaucracy proves public choicers wrong when they say that voters always, everywhere reward only those politicians who cater to their “parochial concerns.”

A fitting post for Election Day, I think.

QOTD: Jeffrey Kluger

Want to know how far we’ve sunk? Here’s how far: There was never any chance at all that we would handle the crisis of thousands of unaccompanied immigrant children running for their lives and arriving at our border with any maturity or grace at all. There was never a chance we’d take them in, get them fed and settled, and then consider sensibly how we can address the immigration-emigration mess on both sides of our border—and on our border—while working to send the kids safely home.

From Jeffrey Kluger, writing in TIME.