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2005 January 12 Wednesday
Bush Vows To Push For His Illegal Immigrant Amnesty

Bush says he plans to treat his horrible illegal immgrant work permit program as a high priority.

Asked whether he will move forward this year with his immigration-reform plan which critics say amounts to amnesty for an estimated 8 million illegal aliens in the United States Mr. Bush said: "Yes. Yes, I will." And asked where his proposal ranks in a second-term agenda already overflowing with big-ticket issues from reforming Social Security to overhauling the U.S. tax code, he said: "I think it's high. I think it's a big issue."

On the bright side Bush's low approval ratings limit his power to push big initiatives through Congress.

President Bush's lackluster job-approval rating will make it harder to push through his second-term tax and Social Security reforms, and could undermine House conservatives' uphill battle against runaway spending, some lawmakers say.

...

Mr. Bush's job rating dipped below 50 percent in a new Associated Press poll and registered 52 percent in a Gallup poll last week. That is well below what re-elected presidents in the past have scored before being sworn in for their second terms.

Unless Al Qaeda manage to pull off another big terrorist attack in the US I do not see how Bush can recover in popularity at all. Events in Iraq are going to continue to hurt how he is seen by the American populace. The huge federal budget deficit effectively prevents him from using increased spending to try to appeal to many sectors of the American populace. If an Al Qaeda attack takes place in America then even though Bush's popularity would soar (human nature being what it is) the public would also become far more fearful of foreigners and would want to see policy changes aimed at preventing illegal aliens from entering the United States. So I do not see how Bush can get into a strong position for pushing his incredibly bad immigration proposal.

Bush has already committed to a very large effort to push his Social Security privatization effort through Congress. I hope that effort will absorb so much political capital that he won't have any left over to push through his potentially very harmful immigration initiative. Bush's second fiscal policy priority after Social Security is tax reform. Will he have much political capital left over after dealing with those two?

In fact, Bush may wound his party badly with his Social Security plan. Newt Gingrich sees Bush's Social Security plan as potentially disastrous for the House Republicans.

Outside Congress, several party activists are sounding similar alarms after word spread last week that Bush is planning to reduce future benefits as part of the restructuring. Former House speaker Newt Gingrich (Ga.) is warning that Republicans could lose their 10-year House majority if the White House follows through with that proposal.

Bush may so frighten the House Republicans that they might dig their feet in against his policies across a large range of issues. On immigration Bush might make common cause with a mix of some Republicans and some Democrats while stiffening a substantial portion of the Republican House members over immigration. But will any Democrats be willing to sign on in support of Bush's immigration initiative? It is not the sort of amnesty that generates Democrat voters right away. So the Democrats might hold out for their preferred form of amnesty that puts millions of future Democrats on the fast track to US citizenship and voting rights.

See my previous post Thinking About Bush's Less Than Half-Baked Worker Permit Proposal for lists of points to keep in mind about why Bush's proposal will make America's immigration problems worse, not better.

Share |      By Randall Parker at 2005 January 12 01:33 AM  Immigration Politics


Comments
John S Bolton said at January 12, 2005 3:09 AM:

It sounds like an implicit admission that the proposal is an amnesty, since it's now said to be 'not citizenship'. Previously the line was:'not amnesty'. The fingerprints of undue influence of Mexican officials and activists seem to be all over this. Their line was: 'workers, not illegals' or 'workers, not criminals', as if anyone called a worker couldn't possibly be also a criminal, nor be on net public subsidy, nor be bad for America. This reminds me of academics who refer to prostitutes as 'sex workers'. Americans are not Marxists; we don't believe that whosoever is called one of 'the workers' is necessarily good for us. If Marx's manual/menial labor theory of value were morally respectable, any manual death camp workers would have superior worth over the nonworkers they killed, or directly collaborated in the killing of. Is this what was to be proven?

PacRim Jim said at January 12, 2005 11:28 AM:

Such amnesty will encourage further millions to come. That's fine, if that's how the U.S. wants to compensate for a declining domestic population. It's not fine, however, if we want to encourage the legal immigration of people with skills. The more the U.S. becomes flooded with illegal aliens, the less attractive it becomes to bright people abroad who could contribute immediately. If you wonder why there's no social security money for your retirement, you can at least take solace in the fact that it went to support illegal aliens.

crush41 said at January 12, 2005 2:42 PM:

If the U.S. gets hit again and it's traced back to illegals coming in from one of the borders the public may not rally behind Bush like they did on 9/11.

Have you posted anything on the proposed social security "privatization"? Of course a reduction in benefits (which is what the plan is designed to do) is going to be a difficult sale, but it is absolutely necessary. Two trillion looks brutal up front, but every new initiative is going to have costs associated with its implementation.

Randall Parker said at January 12, 2005 3:05 PM:

crush41,

Social Security privatization: I am going to post about it. I've been trying to find an economic study about labor market participation rates and tax levels in America and Europe. I think the most compelling argument for privatization is that it might avoid a reduction in economic growth rates and a reduction in labor market participation rates that higher taxes to deal with an aging would cause. But I need to find a study that came out a few months ago comparing Germany and other European countries with the US. The study argued that, compared to Americans, the Germans spend more time working for themselves while working less hours in jobs for a net similar number of hours worked. The reason given was that high tax rates reduce labor market participation. That decreases economic efficiency.

Again, I need to find that study on American, German, and other European labor market participation and tax rates. I've googled for it for hours. I should have immediately posted on it when I saw it first reported. Picture me kicking myself. That study cuts to the heart of the matter as I see it. If anyone can find such a study I'd be really grateful if you could point me to it. Even the names of the economists or their institutions would help.

If we can not find a way to avoid the reduction in labor market participation rates that higher taxes to support a larger aged population will bring then American economic growth will slow to lower European economic growth rates. That slower growth will require still higher taxes in response since vigorous economic growth and the resulting higher tax revenue it produces are currently projected to pay for a large portion of the increase in size of the aged population.

Penguin43 said at January 13, 2005 10:22 AM:

Reality check.

How is U.S. Immigration (ICE/CIS) going to process the several million "guest worker" applications when it cannot process in a timely manner the 1.5 million legal applications now in the system?

In terms of the U.S. current immigration backlog, what impact will "guest worker" applications have on the processing of legal applications now in the system? Will current applicants remain at the front of the line, or will "guest worker" applications push them to the back of the line?

How precisely will ICE/CIS complete criminal background checks on "guest worker" applicants in a timely manner? If these applicants fail their check, how will ICE/CIS find and deport such individuals, given that ICE cannot currently locate 340,000 absconders now in its system?

What will be the approximate realistic processing time for a "guest worker" visa, given that the timeline for the highest priority family-based marital visa is now up to one year in backlog.

What enforcement mechanisms will be employed to deport illegal aliens who choose not to participate in the "guest worker" program?

There are many, many other questions that when raised illustrate this program to be completely unworkable on a practical basis.

Throwing 6 to 10 million new cases on top of an already broken ICE/CIS is the height of insanity, and everyone on Capitol Hill knows it. Ask any Congressional rep what percentage of constituent complaints are about immigration problems. You will be surprised.

John S Bolton said at January 13, 2005 10:02 PM:

A solution or improvement which greatly worsens the problem, is only dishonestly called such. Instead of using the Orwellian, totalitarian big lie technique, of saying we have a solution, which actually intensifies the problem, why don't they try a smaller lie? One might guess that the reason for that would be that the idea is to traumatize people with the extremity of unreason that they are capable of.

crush41 said at January 14, 2005 4:55 PM:

Randall,

Because you have the need for veracity instead of just opinion I guess the consequence is waiting. But I'm young and ignorant enough to shoot from the hip: Higher effective tax rates (especially those that are progressive) raise unemployment because there is less capital available at the top, just as minimum wage does by forcing more of that capital to be spent than would be otherwise required for comparable output.

Here's a paper by an ASU economist that shows labor supply and tax rates are strongly correlated. It's formula intensive, but the raw data tells it all. From 93-96, for the G-7 countries, the marginal tax rate from lowest to highest:

1) Japan and the average labor hours per person (from most to least) 1) Japan
2) US 2) US
3) UK 3) Canada
4) Canada 4) UK
5) Germany 5) Germany
6) France 6) France
7) Italy 7) Italy

Canada, the only bucker of the trend (albeit slight) beat the UK by an average of a whopping six minutes of labor a week.

It's common sensical that higher tax rates are going to decrease the labor supply from the bottom to the top. Even detractors of the plan for privatization don't argue against the fact that it will lessen the need for increased tax rates in the future (or to utilize their spin: "It will decrease social security--gov't paid--benefits"). Instead, they say retirees might leave the workforce when the market is down while others will retire during a boom, creating an inequality. Ignoring that the 2001-02 "downturn" still provided better returns than selling in 1995, '96, or '97 (Clinton "boom") for people who began investing twenty, thirty, or forty years ago, the uneasiness of retiring during an economic recession would have the positive consequence of providing a boost towards economic recovery by keeping more people in the market when the economy needs it most.

Who would you prefer have my retirement money to use while I'm still working: The government or Microsoft, GE, and 3M? Big gov't supporters fear this because it will mean less money for the gov't to spend on pet projects as it sticks another IOU in the social security trust fund.

crush41 said at January 14, 2005 5:01 PM:

Here's the paper. http://minneapolisfed.org/research/qr/qr2811.pdf

Randall Parker said at January 14, 2005 6:00 PM:

crush41, Thanks for the reference. I'll read it along with some others I've been given. Since posting above I asked a couple of economists and they told me Edward Prescott, Guido Tabellini, and Martin Feldstein have written stuff I need to read on this. I've got some links and reading to do before I make a post about this. But look for a post from me on Social Security. Medicare, tax rates, labor market participation rates, and aging populations.

As for your first argument about capital availability: That is not the main problem. The main problem is that at high marginal tax rates workers have less incentive to work more hours. Think about it intuitively. A guy can work overtime to save up money to pay someone to paint his house. Or he can take off time from his job and paint it himself. The higher his marginal tax rate the less it makes sense for him to pay someone else to do it.

If his marginal tax rate is 90% and he earns the same hourly wage as a painter then he has to work 10 hours to pay for 1 hour of the painter's time. If the painter is only twice as productive at painting then it does not make sense for him to pay the painter because he'd have to work more hours to pay the painter than it would take him to do the work himself.

So notice the result. He works less in his job and pays less in taxes. He does the work himself but it takes longer to do it. The painter does not get the work and so the painter does not pay taxes from the earnings he would get from the work. The result is an economy that produces fewer goods and services. But it is not necessarily an economy where people work fewer total hours. They just work fewer hours in paying jobs and do more work for themselves.

Does that make sense?

crush41 said at January 14, 2005 6:26 PM:

Absolutely. I have always assumed that when figures contain data about labor hours that they were referring to employment in some form, not home improvement/personal finance "labor" they choose to do themselves. Is that not the case?

Your example becomes even more powerful if you assume the man in question is an accountant who makes five times what the painter does. If he's taxed to the point of making 50% of what he has to pay the painter on an hourly basis, then he, as a professional, may very well choose to paint his own house (assuming the painter is still twice as productive). That has serious ramifications on the strength of an economy (and is likely to lead to a net loss in tax revenue, even though the rate is astronomical).

Proborders said at January 16, 2005 9:11 AM:

Bush's amnesty proposals could become law. A coalition of cheap labor, open borders Republicans, moderate Republicans, and Democrats in the US House and US Senate could pass an amnesty program for illegal aliens.

In general illegal aliens should be deported. They should not be given work permits.


I think that Bush's Social Security reform plan would not raise Social Security withholding taxes. It seems that younger workers would be allowed to invest some of their Social Security withholdings in the stock market. These stock market investments might be overall beneficial or harmful to each younger worker. Basically younger workers would be given the opportunity of possibly "earning more" from their stock market investments. However, if the stock market investments do not do well, the worker will have a diminished Social Security benefit at retirement.

Bush's Social Security reform plan could lead to future retirees who were born during the 1960s and 1970s to have difficult and impoverished lives as senior citizens.

In my opinion Generation X should oppose Bush's Social Security reform plan.

Shivan said at April 19, 2005 7:40 AM:

Would he pass the Amnesty for Carribean countires and so on ?

Sharman said at September 8, 2005 5:48 PM:


I heard that there is a Amnesty for Illegal Immigrants , Is that Right? I just heard today, so if anyone knows about it could you let me know,

sandy gard said at October 13, 2005 4:57 AM:

i'm a 24 years old live in boston i have a 1year old baby girl and i'm illegal i need to work to take care my baby girl please help me get my green card please i graduated in high school since 2001 i need to go to college and work to take care my baby girl please write me back


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