There's been more news of the decline of traditional news organizations. Hmmm..... Do you suppose that they still don't get it? As noted before, the decline of newspapers and broadcast news outlets ties closely with the decline in the quality of their reporting. Even news.google.com got "sanitized" a while back - making it mainstream North America-centric. Why would anyone bother to search out alternative news sources on the web if they felt there needs were being met by traditional news sources?
The issue of immigration is causing consternation for all of Washington, but particularly the republicans. Here's a no-win issue for them. How come? Because they can't address it with fear, religion and corporate cash.
The problem is big. Republicans' financial backers love the cheap labor, but republican voters tend to hate immigrants. But its not only politics that makes the problem big. How many immigrants should we allow into the US? With what sorts of backgrounds/qualifications/skills? And, from where?
There has been a traditional leniency shown to Europeans, especially northern Europeans, in our immigration process. This is often taken (probably correctly) to be partially a manifestation of latent racism. There has also been a tendency to be tolerant of immigration from our most heated foes. This, combined with pressure from influential constituencies give us the Jewish migration from the Soviet empire and the wet foot/dry foot policy of Cuban immigration. But, its unclear that any of the above policy has served us well, or for that matter poorly.
Some political operatives, and some citizens, have said that they're not against foreigners or immigration, only illegal immigrants and immigration. Tsk tsk, we must all be upright, law-abiding citizens. Of course how many of them never drive over the speed limit, or never make a left turn across a double yellow line in the road?
Naturally these folks are followed closely by those who suggest that illegal immigration is a national security issue. Lets see, our borders are porous so we are at risk. Let's kick out Mexicans and we'll be safe. Hmm, but what about inspecting containers in ports? Nah, the security issue doesn't carry much weight when we don't demonstrate adequate concern about all critical aspects of national security.
Then there are those who argue that foreigners are coming and stealing our social services without paying for them. Well, that sounds like a serious issue. Of course, this supposes one or more of several situations are taking place:
- Immigrant labor isn't paying its taxes.
- Immigrants don't work, so they don't owe taxes.
- Their contribution to the economy by taking hyper-low paying work doesn't constitute a form of tax payment of its own.
Some illegal immigrant labor is below the table, and the proportionate rate of this may be higher than in the larger population. But, are they, or are their employers, the problem? And, are they a bigger problem than tax cheats, or the large corporate loop-holes? Frankly, this issue begs the question of whether their economic contribution out weighs their social burden. This is a question left unasked and unanswered by those that raise the social services issue.
The bottom line is that we haven't had a coherent and sustainable philosophy of when and why to limit immigration. Nor have we had one since this country was founded. And yet we all know that the USA can't take up the burden of being the refuge, or economic incubator, for every person in the world looking for political freedom, economic opportunity, education, or an escape from whatever circumstances they currently face where they are. And we shouldn't feel guilty about this, no other country could either.
So, we have a backlash against immigration even without anyone showing that its a bad thing. And, as the immigrants keep telling us, our economy is completely dependent on them. They are too integral a part of the economy to be forced to leave. And here is where the republicans first get in trouble. They are in favor of cheap labor, regardless of whether its indigenous, imported, or in the Marianas Islands. After all, their first allegiance it to stuffing their pockets (which to them is akin to free-market capitalism).
In the US, maintaining low labor costs appears to be more complex than busting unions and minimizing the minimum wage. In fact, without immigrant labor, its quite possible that we would be facing a labor shortage here today.
At first blush, this may seem hard to fathom. After all, we've exported nearly all of our manufacturing, and farming is an increasingly mechanized proposition. Its hard to find well paying work without a college degree. So, where is all of our labor going that we would have a shortage? And, mind you, the baby-boomer retirement effect hasn't yet begun in a significant way.
My short answer to the question is I'm not sure where our labor is going. Some to Iraq, but not enough to be of consequence. Yet, immigrant and second-generation labor, especially from Mexico, is becoming more and more visible as it takes on higher status and higher profile jobs. Most fast-food restaurants seem to staff almost exclusively with immigrant/second-gen labor. More and more sit down restaurants are using immigrant/second-gen labor in serving positions. More and more immigrant/second-gen labor is active in skilled or semi-skilled jobs in the construction industry. So, where are the native American laborers? Whoops, I didn't mean that. Close call! What I meant to say was where are the good-old red-blooded American workers who used to fill these jobs?
In different vein, we have a trade deficit, an oil addiction, and a costly war to fund. How come we aren't bankrupt and destitute? Well, we may be closer to that state than we realize, but there must be some way that we claw back dollars and employ red-blooded Americans outside of manufacturing, farming, and construction.
Here are some thoughts:
Economic theory is enamored with the benefits of scale. Most of this is overrated, but power does come from scale. So, there is an inherent, consistent, move to consolidate businesses, industries, and governments. As businesses grow, they become harder to manage and spawn corps of professional managers. My son was explaining certain major inefficiencies in his small department of the major company for which he works. These could be easily be eliminated by publishing some guidelines so that people weren't daily reinventing the wheel. But, no manager wanted to be held accountable for what the guidelines might say. It was much easier to justify the inefficiencies resulting from no guidelines than to be responsible for the results of any guidelines. That's economy of scale for you!
Consider that, as companies aspire to grow, the sales function takes on supreme importance. We have to make the numbers! And so the sales force becomes the best compensated part of the firm. Of all the revenue earned, what percentage goes into sales and marketing? In many firms, the number is surprisingly high. We take sales to the marginal dollar. In so doing, we spend on sales and marketing until the next sale is a net loss due to sales and marketing costs incurred to achieve it. So, a foreign manufactured good is produced cheaply and shipped economically to the US. Then its sold expensively due to sales and marketing costs. What part of the consumer price of goods stays in this country?
Services! We've been told that we're a services economy. Look at Skilling over at Enron. Some pundits have suggested that he had too little knowledge for his role because, prior the Enron, he had only ever been a consultant. As a consequence, he shouldn't be expected to understand the difference between a paper profit and a real one. This kinda begs the question of what a consultant would be good for? Eh? But, they don't have to be good for anything, as long as their services can be sold. Management doesn't want to "ad to headcount", so it hires a consultant for 3x or 4x the cost - sometimes for years at a time. Management doesn't like what its own people are telling it? Hire a consultant who will consult with you before offering his/her opinion (in support of your own). Now this may sound cynical, but if consultants are so good at running businesses, why are they consulting?
Finally, we do have one big export commodity - war. Whether waged by us, or merely arming the rest of the world and stimulating their conflicts, we do get hard currency from our military industrial complex. Kinda makes you wonder, doesn't it? Is this what our economy is built on?
