New York City mayor Michael Bloomberg argues that immigration reform can foster growth (Bloomberg). Cities with larger foreign born populations enjoy stronger credit ratings, revitalized neighborhoods, and higher per-capita incomes. High skilled immigrants are more likely to start a business and can increase productivity and job growth; STEM professionals create an average of 2.62 U.S. jobs each. While reform remained stalled in the United States, nations such as Germany and South Korea are easing restrictions to attract global talent. One particular area of concern for U.S. competitiveness is the relative low level of employment visas; only 7 percent of U.S. green cards have an economic rationale.
CFR’s 2009 Independent Task Force on U.S. Immigration Policy, chaired by Jeb Bush and Thomas F. McLarty III, recommends policies with three goals: reform of legal immigration to improve efficiency and U.S. competitiveness; effective enforcement of immigration laws; and a fair, humane, and orderly way to deal with migrants illegally living in the United States.
Young Immigrants Seek Deportation Reprieve
On Wednesday the Obama administration will begin accepting applications for a program which will grant two-year deportation deferrals and work permits to young illegal immigrants (NYT). The program—created by executive order—embodies elements of the failed Dream Act by granting a deportation reprieve to students and graduates who were brought to the United States as children. Approved applicants will not receive legal status or be on a path to citizenship, but can obtain a Social Security number, and apply for a driver’s license or college financial aid.
Education and human capital. Read more from experts discussing ways to improve U.S. education and immigration policies.
Debt and Deficits
Cities Continue to Suffer Fiscal Crunch
Declining property tax revenues and state grants have combined with rising health and pension costs to create city budget crunches across the nation (WSJ). Moody’s Investor Service warned that municipalities have a “small but growing trend in fiscally troubled cities unwilling to pay their debt obligations,” even though bankruptcies are likely to remain rare. Some cities are slashing costs, while others are trying to raise revenue through higher property tax rates and fees. Some states are intervening, while other states’ laws limit the options of city leaders.
Budget Myths on Both Sides
The Washington Post editorial board criticized both the Obama and Romney presidential campaigns for promoting fiscal visions based on “dangerous myths.” They argue that the Romney campaign is incorrect in its view that the nation’s fiscal woes can be healed without increasing revenues, even for a smaller government that campaign envisions. On the other side of the aisle, they argue that the Obama campaign’s solutions are also inadequate; the budget shortfall cannot only be balanced on the backs of the wealthy, especially with a promise of little change to entitlements.
Debt and deficits. Read more from experts on the challenges in reducing U.S. debt.
Corporate Regulation and Taxation
Adding Fresh Teeth to a Financial Regulator
The New York Times profiles Gary Gensler and his work as chairman of the Commodity Futures Trading Commission (CFTC). The CFTC is charged with regulating many complex financial derivatives, but the agency has a lower profile than others such as the Securities and Exchange Commission (SEC), and was seen as a light-handed regulator. Since his 2009 appointment, Gensler has changed that perception with high profile investigations and his push to enact new rules and exercise powers under the Dodd-Frank Act.
The 2010 Dodd-Frank Act—one of the most significant regulatory reform measures since the Great Depression—continues to arouse debate over its methods, goals, and implementation. This Backgrounder by Steven J. Markovich examines the financial oversight bill.
Corporate regulation and taxation. Read more from top economists and business experts on solutions for addressing corporate tax reform.
International Trade and Investment
Asian Demand Reopens U.S. Paper Mill
Growing Asian middle classes are demanding more personal care items and creating a new market for some products of U.S. paper mills (WSJ), including fluff, a soft yet absorbent white material found in diapers, tampons, and bandages. International Paper Co. is reopening a giant mill in Franklin, VA, to cater to these expanding groups.
Bloomberg Businessweek argues that the term “middle class” is misleading in China; many consumers with rising incomes eschew middle-of-the-road brands such as Gap, to either buy cheaper goods or save up for premium brands like Armani.
International trade and investment. Read more from leading analysts on the debate over next steps in U.S. trade policy.
The Morning Brief is compiled by Renewing America contributor Steven J. Markovich.