What should be done about illegal immigration?

au, That's what I've maintained in previous posts; government corruption influences the country's economy more so than tax rates.

Russia is a good case in point; their citizens are well educated, but most were unable to make a decent living, because their government corruption has stifled their economy. Seven years ago when I visited Russia, the staff on board our river boat were all professionals like doctors, lawyers, and college professors. It's because it didn't matter what one's educational level or profession - most incomes were similar at about $100/month, and those working on tourist river boats made more in one month - about $500/month. Six years later, our river boat was staffed with college students, because most professionals now make a "living" wage. Most of them working on tourist river boats are multi-lingual.

The big cities like Moscow and St Petersburg, especially the main shopping streets, are filled with more internationally known designer goods, and the citizens are better dressed and frequent the better hotels and restaurants. Times have changed for the Russians, but Putin seems hell-bent on restricting democracy.

au:

Sounds exactly like some of the problems we have in the US, except we don't have anywhere to go to upgrade our standard of living (that will have us, anyway).

Some economic effects of "free trade":

1) Other things being equal, the standard of living of the major trading partners reach an equilibrium. If your country happens to have the highest standard of living going in, it WILL fall.

2) Other things being equal, if there exists a trade imbalance vis-a-vis one's major trading partners, the strength of the respective currencies shifts in favor of the country that does not have the negative trade balance.

3) Other things being equal, and understanding that labor is a major cost in production, labor competition becomes another "traded" commodity on the "free market". Either by importing the labor or by exporting the jobs.

Of the three I have mentioned, the observable effects are noticed in reverse order of listing. Nr. 3 is already in full swing. We have "outsourced" millions of jobs from the US (overpriced in the free labor market) to elsewhere and have "imported" millions of individuals who are willing to become "cheap labor".

Nr. 2, although the effect is exacerbated by our Government's continual deficit spending, the expected effect is already being noticed. Some of the overseas currencies are trading vis-a-vis the dollar at levels unseen in years. This is NOT a fluke.

Lastly, we arrive at Nr. 1. Although it is not greatly noticed as yet, I see some glimmers of the concept that we are living beyond our means. Not just at the consumer level but at the Government level also. The record level of credit card debt. The record level of foreclosures in the mortgage industry. The record levels of bankruptcies, despite "tougher" regulations for filing.

I submit our overall standard of living IS falling, but we have held off the inevitable by deficit spending, just like our Government. It comes down to how much our dollar will buy, NOT how many dollars one has.

The three items listed above are not mine, they come from a graduate level course in international economics. Whereas the model is 20 years dated, the test of time seems to be proving the theory.

Halfback

Halfback, Since not all things are equal, assumptions about a) shifts in standard of living, b) currency value shifts, and c) exporting and importing of labor are a complex of many variables. It has to do with other issues such as 1) health of the populace, 2) education, 3) government corruption, 4) country's infrastructure, 5) communication, 6) transportation, 7) the variety of economic production/services, and 8) capital investment.

As the value of the US dollar losses against other major currencies, our balance of payment is reduced, and our products and services become more competitive in the world markets.

Those holding US bonds are between a rock and a hard place. They can't afford to sell those bonds in the open market, because they lose value on their remaining holdings.

There are interesting dynamics at work that isn't all lose-lose for the US, but the current trends in the devaluation of the US dollar is not healthy for the long-term of our economy.

Our economy should be suffering from inflation because wages are not keeping up with inflation and the cost of energy and food continues to increase. Somebody is playing loose with the statistics on inflation; too much consumer and government debt while the cost of necessities increase is the perfect definition of inflation.

Some pundits are saying that the housing problem will be over in about one year; don't you believe it!

Save your money.

All of what you say is true. The standard of living adjusts, as I said, and reaches an equilibrium somewhere down the line with the trading partners. The weakened (or inflated) Dollar makes our products more sellable overseas, as you mentioned.

My question is, how long does it take? How much "belt tightening" must we do in the interim?

Like I said, it's NOT how many dollars you have, it's what you can buy with the dollars that counts.

There was another thread that touched on the machinations of the "Consumer Price Index". Fuel and Food are left off the calculations in favor of "hard assets". The general excuse is that the F/F figures have too much volatility in them, thereby negating a calculation of "real" inflation.

CRAP! It is kept out so the proletariat won't panic. Pure and simple. Oh, yeah...... the lower figures can then be used to determine less costly COLA adjustments year to year.

"There ain't no justice 'ceptin' injustice!"

Halfback

Halfback: My question is, how long does it take? How much "belt tightening" must we do in the interim?

That's a tough question to answer, because today's economy differs from all previous ones. Even during simpler times when the variables were much less to contend with, financial pundits had difficulty with that question.

With the rising debt of our government and consumers, I believe any recovery period is a few years off. Stay the same by our government and consumers only exacerbates our own problems, and that's what we're going to get from Bush.

This is the very first time in modern history since WWII that our government is shifting the cost of the Iraq war to future generations. That in of itself is a huge handicap for the future of our economy.

My rough guess? About ten years, but only if our future governments are fiscally responsible; it doesn't look that promising.

Even on A2K, the first four items on the poll add up to 60%, which, to me, is an simple majority.

So, who's in favor of enforcing the laws already on the books, and either arming able bodied Americans or calling up the National Guard, and getting the illegals out of here? Surprise, surprise, A2K is!!!

CI:

Actually, it is not only the war costs that have been passed on.... the Country has run into deficit spending for every year since 1969, except for a couple of years under Clinton.

Every deficit year is passed on via "National Debt" increases. Even the yearly "deficit" is padded toward the positive by the simple expedient of syphoning off the excess intake vs outgo of the Social Security System to add to the general fund. That "surplus" will be gone in but a few years and the general fund will be tasked to "repay" that money, more than likely.

Whereas the interest on the National Debt used to be a manageable 2 or 3 percent, it is now 10% of the budget! As the interest rate is increased in order to generate investors to "buy into" the National Debt, in the form of "Treasuries", so will the interest on that Debt increase as a percentage of the budget. We are painting ourselves into a financial corner here!

When 10% percent of your budget is dedicated to making "interest only" payments on your debt WITHOUT even TRYING to reduce the balance of the principle..... you are heading for serious problems. (Sounds like a lot of consumers I hear about, no?)

Halfback

Generally true; the debt being created today is not the same as the debt created in the past. With the maturation of the developed countries economy, our ability to "compete" on the world stage becomes more tenuous as we increase our balance of trade, and our dollar value loss against the major currencies of the world.

What is ironic for Americans are simply that the majority are "happy" with their income and their possessions, and most are comfortable with our future.

Most are not that concerned about our war in Iraq, nor the debt buildup for it, because most are not personally involved or affected; it's not as if our taxes are higher and paying for it or our family member is there fighting or getting exposed to getting killed or maimed. Strange.

We've known about how our federal government plays loose with the annual budget with much of the funding coming from the social security fund; both democrats and republicans play this game. They fail to make the hard choices of reducing spending to match real income.

Inflation is here; nobody seems that concerned. Labor Department stats show that most households have lost buying power to inflation during the past six years, and the savings rate has fallen into the negative. No worry; we'll pay the interest - some in the twenty percent range on credit card debt.

How much longer will this madness continue?

Until we get a financially responsible Congress that realizes that there IS a limit to the money they get to "play with" along with a financially responsible proletariat.

I expect to learn to fly, unaided by mechanical contrivance, before that comes to be.

Halfback

Let us know when you make your first solo flight.

I think that the Dems believe in pay-as-you-go. John Spratt, chair of House Budget, had a big hand in Clinton's surpluses, which came out of this system. Spratt stands ready to bring this back once Bush, and his vetoes, are out.

Bush thinks that his deficits are fine because of the relatively large GDP. However, there is little relationship between the two. There is a relationship between deficits and the savings rate. Unfortunately, we now have negative savings.

It's not only the negative savings; it's the devaluation of their equity in the biggest investment of most families - their homes. There's no place to borrow from any more, and consumer spending that has sustained our economy has disappeared.

The half point drop in interest rates by the feds is a big joke; consumers are already in debt up to their eyeballs.

Getting back to immigration, the population of the country is now about 300 M.

I think that is a lot (probably excessive), and that legal immigration should be reduced, and illegal eliminated by all necessary needs. Moreover, the illegals now in the country should be expelled.

Advocate, I don't think our country is even close to being "full." In order to maintain our economic "power," we need to continue with immigration to our country. There are still a whole lot of open space in the US; let's not cut off our nose by making assumptions about "too many."

31,7 per square kilometer. You should come over here (230.5), or the UK (224.5). Not that I'm suggesting The Netherlands .... (390.1).

Walter, tell us what it is like in Europe with heavy concentrations of people.

We were an economic powerhouse long before our population soared to the present number. If anything, a larger population will drag us down economically and otherwise. For instance, as you well know, China works very hard to keep its population from growing, even to the point of punishing couples having too many children.

We don't have excessive land. We need vacant land for agriculture, recreation, watershed, mining, timber, etc. Even with our land area, and many rivers and lakes, we are suffering terrible shortages of water that are expected to last. One reason is the increasing number of people drawing on the water resources. Atlanta has less than a 90-day supply of water. The Southeast has been warned that conditions, and restrictions, will be extreme by March.

Further, the USA is facing increasing environmental damage and challenges. Certainly, a large growth of population, such as that caused by immigration, will exacerbate this problem.

Advocate, China is a basket case; they're growing at an annual ten percent rate, but their environment and health problem are increasing at unsustainable levels. they're paying a high price for their economic growth. They are short of clean water; no population on earth can survive without clean water, and they're trying to provide water for over one billion plus the use of water in their agriculture and industries. It's not sustainable; it's only a matter of time when all the shite hits the fans.

CI, thanks! You made my case. I see the USA, with its present rate of population growth, becoming another China regarding the environment, etc.

This supports the argument that immigration, especially regarding illegals, should be curtailed.

It's up to our government to control illegal immigration. If they don't take on the responsibility, some states and communities have established their own form of control.

Irregardless; we still need workers to fill jobs that many/most Americans will not fill.

There's always two sides to every issue.