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152. Estonia and the European Debt Crisis
- Author:
- Juhan Parts
- Publication Date:
- 04-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Estonia has had a quick recovery from the recent recession and its economy is in better shape than before the crisis. It is now much leaner and significantly more capable of handling international shocks. After a sharp contraction, in which GDP contracted by over 14 percent in 2009, GDP growth rebounded quickly, growing at a rate of 3.1 percent in 2010 and 8.3 percent in 2011.
- Political Geography:
- Europe and Estonia
153. The Welfare State as an Underlying Cause of Spain's Debt Crisis
- Author:
- Pedro Schwartz
- Publication Date:
- 04-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The ongoing crisis that so dramatically hit Spain in 2008 was at least in part caused by the countercyclical monetary policy the Federal Reserve and the European Central Bank applied in the first years of the new century. Their artificially low interest rates must in part be responsible for the excessive leveraging in banks, businesses, and households. Their unwarranted use of monetary policy to foster growth has recoiled on them with a vengeance. Now central bankers and their political masters find that they cannot perform as expected. A constant feature of financial crises in the past two centuries, as Reinhart and Rogoff (2010) have noted, is that, when banks collapse, companies fail, and families go insolvent they all turn to the central bank and the government to bail them out. The authorities usually find it difficult to answer those anguished calls even when they have the power to print money, so that devaluations and write-offs ensue.
- Political Geography:
- Europe and Spain
154. Market Failures, Government Solutions, and Moral Perceptions
- Author:
- J. R. Clark and Dwight R. Lee
- Publication Date:
- 04-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- It should be obvious to even the casual observer that both markets and governments fail—neither comes close to achieving perfection. Externalities, both positive and negative, are the most common explanation for market failures. The undersupply of public goods, for example, is seen as a market failure, and is the direct result of a positive externality being generated when a person contributes to a public good which, by definition, benefits others whether they contribute or not. Similarly, excess pollution is seen as a market failure resulting from the negative externality of people imposing uncompensated costs on others by emitting pollutants into the environment. But externalities are just as commonly the result of government activity as they are market activity. For example, many government transfers are best seen as negative externalities motivated by the desire of politically influential groups to benefit at the expense of others.
155. Canada's Fiscal Reforms
- Author:
- Chris Edwards
- Publication Date:
- 04-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Two decades ago Canada suffered a deep recession and teetered on the brink of a debt crisis caused by rising government spending. The Wall Street Journal said that growing debt was making Canada an "honorary member of the third world" with the "northern peso" as its currency. However, Canada reversed course and cut government spending, balanced its budget, and enacted pro-market reforms. It reduced trade barriers, privatized businesses, and slashed its corporate tax rate. The economy boomed, unemployment plunged, and the formerly weak Canadian dollar soared to reach parity with the U.S. dollar. The Canadian reforms were hugely successful. Today, the United States is in as bad or worse fiscal shape than Canada was in. U.S. leaders need to make major fiscal and economic reforms, and they can learn many lessons from Canadian efforts to restrain government and create a more competitive economy.
- Topic:
- Reform
- Political Geography:
- United States and Canada
156. Red Ink: Inside the High-Stakes Politics of the Federal Budget
- Author:
- Daniel J. Mitchell
- Publication Date:
- 04-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- If you want a primer on fiscal policy issues that gives you an establishment perspective, David Wessel's Red Ink should be your cup of tea. If you thought the 1990 budget deal was a good thing and if you want something similar today, you should read Red Ink to have your views reinforced.
157. The Righteous Mind: Why Good People Are Divided by Politics and Religion
- Author:
- Aaron Ross Powell
- Publication Date:
- 04-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The Righteous Mind offers a comprehensive and intriguing answer to that age-old political question, "Why do so many people disagree with me?" After all, I believe what I believe because I think the evidence and arguments are convincing. Otherwise, I wouldn't believe it. So why do others disagree?
158. Curbing Campaign Cash: Henry Ford, Truman Newberry, and the Politics of Progressive Reform
- Author:
- John Samples
- Publication Date:
- 04-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- No one has yet written a detailed history of campaign finance regulation, even limited to the United States. In 1988, Robert E. Mutch published Campaigns, Congress, and Courts: The Making of Federal Campaign Finance Law. He then embarked on research seeking to fill out that story in the late 19th century. My own The Fallacy of Campaign Finance Reform combines public choice analysis with political theory in a way that historians might not recognize. Ray La Raja's excellent Small Change: Money, Political Parties, and Campaign Finance Reform Examines a larger historical tableau from a political science perspective. Paula Baker is apparently at work on a broader history of campaign finance and its regulation. This work began as a case study in that project and grew into a book. I look forward to the broader history, but I am happy to have this work.
- Topic:
- Reform
- Political Geography:
- Europe
159. Editor's Note
- Author:
- James A. Dorn
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- This issue of the Cato Journal features the papers from Cato's 30th Annual Monetary Conference— Money, Markets, and Government: The Next 30 Years —which was held in Washington on November 15, 2012. After 30 years, it is well to recall F. A. Hayek's advice: “All those who wish to stop the drift toward increasing government control should concentrate their effort on monetary policy.”
- Political Geography:
- Washington
160. Anna Jacobson Schwartz: In Memoriam
- Author:
- George S. Tavlas
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- This issue of the Cato Journal is dedicated to Anna Jacobson Schwartz, who passed away on June 21, 2012, at the age of 96. Anna was an economic historian whose scholarship was marked by, among other things, dedication, tenacity, and perseverance. Her career spanned three quarters of a century. When Anna was about 90, her son Jonathan complained (somewhat tongue-in-check) that he had thought about retiring, but did not feel comfortable doing so while his mother was still working. In 1936, she began collaborating with A. D. Gayer and W. W. Rostow on a study of fluctuations in the British economy between 1790 and 1850. The study was not published until 1953, although most of the work on the study had been completed by the early 1940s. Anna joined the National Bureau of Economic Research in 1941 and remained there for the rest of her life, continuing to go to her office until shortly before her death. She published her first NBER paper in 1947 with Elma Oliver, and her last with Michael Bordo and Owen Humpage in 2012. Her collaboration with Milton Friedman on A Monetary History of the United States, 1867–1960 began in 1948 and was not completed until 1963. The underlying objective of Anna's scholarship throughout her career was to use historical evidence, which she assembled with meticulous attention to accuracy, to understand the workings of the economy better.
- Topic:
- Economics
- Political Geography:
- United States
161. Monetary Policy during the Past 30 Years with Lessons for the Next 30 Years
- Author:
- John B. Taylor
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The 30th anniversary of the Cato Institute's monetary conference series provides an excellent opportunity to take stock of what we have learned about monetary policy in the past 30 years and to draw lessons for the next 30 years.
162. Fed Policy: Good Intentions, Risky Consequences
- Author:
- Charles I. Plosser
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The last five years have been an extraordinary time for the global economy and monetary policymakers. The financial crisis and the severe global recession that followed have tested our resolve, our patience, and our economic theories. To restore the health of ailing financial markets and economies, central banks have driven shortterm interest rates to essentially zero, expanded their balance sheets to unprecedented levels, and engaged in market interventions that have blurred the lines between monetary policy and fiscal policy.
- Topic:
- Economics and Health
163. The Conduct of Monetary Policy
- Author:
- Kevin Warsh
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The Federal Reserve's independence is essential to the conduct of monetary policy. But while the Fed is independent within government, it is not independent of government. The grant of authority to the Fed comes from Congress, to which the Fed is ultimately accountable. In my view, the Fed was granted significant powers by Congress, but those powers were not unlimited. The grant of authority was constrained. So by my measure, the Fed is a powerful institution, but a bounded one.
- Topic:
- Government
164. The Fed Needs to Change Course
- Author:
- David Malpass
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- This article describes the Federal Reserve's monetary policy, examines its economic impact, and discusses possible exits. Federal Reserve policy is on the wrong course: it is harming economic growth, hurting savers, damaging markets, setting dangerous precedents and misallocating capital away from job-creating parts of the economy. The Fed's September 2012 policy change, in which it announced a third round of quantitative easing (QE3), was a major increase in the aggressiveness of monetary policy and, in my view, another drag on economic growth.
- Topic:
- Economics
165. Avoiding the Next Crisis: Can Central Banks Learn?
- Author:
- Robert L. Hertzel
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Any effort to avoid future recessions must rest on an organized way to learn from the past. However, the absence of such efforts within central banks renders such learning problematic and makes likely the recurrence of episodes of recession and financial market turmoil. Critical to learning is the use by policymakers of models to evaluate the past performance of monetary policy. These models should not be the complicated, multiequation models favored by the forecasting departments of central banks. Rather, they should be simple models that require policymakers to take a stand on the basic issues in monetary economics: the nature of the price level (monetary or real) and how well the price system works to maintain output at potential (full employment). They should serve as a safeguard to the understandable tendency of central bankers to attribute economic disturbances exclusively to real shocks rather than monetary shocks.
- Topic:
- Economics
166. Should Policy Attempt to Avoid Financial Crises?
- Author:
- Jeffrey A. Miron
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The 2008 financial crisis and the 2007–09 recession have predictably spurred interest in how policy can avoid financial crises. A prior question, however, is whether policy should avoid financial crises. The answer might seem obvious. But I argue here that if policymakers focus on avoiding crises, they will generate undesired side effects and typically fail to avoid crises in any case.
167. What's Wrong with the Fed? What Would Restore Independence?
- Author:
- Allan H. Meltzer
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- On September 1, 1948, Allan Sproul, president of the Federal Reserve Bank of New York, commented on Fed independence: I don't suppose that anyone would still argue that the central banking system should be independent of the Government of the country. The control which such a system exercises, over the volume and value of money is a right of Government and is exercised on behalf of Government, with powers delegated by the Government. But there is a distinction between independence from Government and independence from political influence in a narrower sense. The powers of the central banking system should not be a pawn of any group or faction or party, or even any particular administration, subject to political pressures and its own passing fiscal necessities [Letter to Robert R. Bowie, in Meltzer 2003: 738].
- Topic:
- Government
- Political Geography:
- New York
168. Federal Reserve Independence: Reality or Myth?
- Author:
- Gerald P. O'Driscoll Jr. and Thomas F. Cargill
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The Federal Reserve was founded in 1913 during the Wilson administration to end banking panics and depressions, and was part of the Progressive agenda for a more activist role of government (see Kolko 1963). By the 50th anniversary, the conventional wisdom was that the Fed's performance was overall satisfactory, especially after the Treasury-Federal Reserve Accord of 1951 that permitted independent monetary policy. While the decision to double reserve requirements in 1937 was judged a policy error, the Federal Reserve was not held responsible for the Great Depression.
- Topic:
- Government
169. Balance Sheet Crises: Causes, Consequences, and Responses
- Author:
- Steven Gjerstad and Vernon L. Smith
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Balance sheet crises, in which the prices of widely held and highly leveraged assets collapse, pose distinctive economic challenges. An understanding of their causes and consequences is only recently developing, and there is no agreement at all on effective policy responses. A preliminary purpose of this article is to examine in detail the events that led to and resulted from the recent U.S. housing bubble and collapse, as a case study in the formation and propagation of balance sheet crises. The primary objective of the article is to evaluate similar events around the world with a view toward assessing the economic performance of countries that have pursued varied alternative policies.
- Political Geography:
- United States
170. Antifragile Banking and Monetary Systems
- Author:
- Lawrence H. White
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- “Fragility” is the well-known property of being easily breakable, of failing under moderate stress. The opposite property is “antifragility,” a term coined by Nassim Nicholas Taleb (2012a) and the title of his recent book. Taleb (2012b) defines antifragility as the property exhibited by “things that gain strength from stressors and get stronger from failure, like evolution.” An antifragile thing or system is stressloving. What doesn't kill it makes it stronger. We exercise, for example, because our muscles grow stronger from moderate stress. Robustness, an intermediate concept, is the property of being unaffected either way by moderate stresses. Taleb illustrates the threefold distinction this way: We stamp “handle with care” on a package containing something fragile; we needn't stamp any instructions on a package containing something robust, because it won't be affected by handling; but we would stamp “please handle roughly” on a package containing something antifragile, because such handling would make it emerge stronger.
171. The Case for Simple Rules and Limiting the Safety Net
- Author:
- Thomas Hoenig
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- For the last 100 years, government officials and bank CEOs have insisted that new policies, rules, and laws—combined with greater market discipline, resolution schemes, and enhanced supervision—would ensure that future financial crises, should they occur, would be more effectively handled. In the United States, the creation of the Federal Reserve System and Federal Deposit Insurance Corporation are examples where such assurances were given to the public. More recently, the FDIC Improvement Act of 1991 and other legislation were intended to end public bailouts of failing banks and, in particular, prevent the moral hazard problem inherent in “too big to fail.” Such assurances seem even more significant following a U.S. Treasury (1991) study that found that “too big to fail” resolution policies used for six of the largest banks cost taxpayers more than $5 billion (in current dollars). If only the cost of the six largest bailouts in this recent crisis were just $5 billion. Unfortunately, it was many times greater.
- Political Geography:
- United States
172. The Gold Standard, the Euro, and the Origins of the Greek Sovereign Debt Crisis
- Author:
- Harris Dellas
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The entry of Greece into the euro zone in 2001 was widely expected to mark a transformation in the country's economic destiny. During the decade of the 1980s, and for much of the 1990s, the economy had been saddled with double-digit inflation rates, double-digit fiscal deficits (as a percentage of GDP), large current-account imbalances, very low growth rates, and a series of exchange rate crises. Adoption of the euro—the value of which was underpinned by the monetary policy of the European Central Bank (ECB)—was expected to produce a low-inflation environment, contributing to lower nominal interest rates and longer economic horizons, thereby encouraging private investment and economic growth. The elimination of nominal exchange-rate fluctuations among the former currencies of members of the euro zone was expected to reduce exchange rate uncertainty and risk premia, lowering the costs of servicing the public sector debt, facilitating fiscal adjustment, and freeing resources for other uses.
- Topic:
- Economics
- Political Geography:
- Europe
173. Why the Euro Failed and How It Will Survive
- Author:
- Pedro Schwartz
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The great hopes that surrounded the euro at its birth have failed to come true. It was intended to be a currency as sound as the deutschemark and also a symbol of European unity. It is now reeling under the blows of a prolonged financial crisis and creating discord among the members of the European Union. Clearly, the design of the new money was defective. What its flaws were has been generally misdiagnosed: I will suggest that even if euro- members had kept by the rules of the game the euro could not have worked as intended.
- Political Geography:
- Europe
174. The Euro at a Crossroads
- Author:
- Wolfgang Munchau
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- It was one of the author's predictions in 1998 that the euro zone would end up teaching us more about economics compared to what economics could teach us about the euro zone. While many of the author's predictions of that year did not hold, including the forecast that the euro would challenge the dollar as the world's foremost reserve currency, this particular prediction ultimately turned out to be correct. A monetary union is a hybrid between a fixed exchange rate system and a unitary state, one that is fully captured neither with closed-economy macro models nor classical international macro models of fixed exchange rates.
- Topic:
- Economics
- Political Geography:
- Europe
175. Lessons from the European Crisis
- Author:
- Jurgen Stark
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- It was one of the author's predictions in 1998 that the euro zone would end up teaching us more about economics compared to what economics could teach us about the euro zone. While many of the author's predictions of that year did not hold, including the forecast that the euro would challenge the dollar as the world's foremost reserve currency, this particular prediction ultimately turned out to be correct. A monetary union is a hybrid between a fixed exchange rate system and a unitary state, one that is fully captured neither with closed-economy macro models nor classical international macro models of fixed exchange rates.
- Topic:
- Government
- Political Geography:
- Europe
176. The Renminbi's Prospects as a Global Reserve Currency
- Author:
- Eswar Prasad and Lei Ye
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Popular discussions about the prospects of China's currency, the renminbi, range from the view that it is on the threshold of becoming the dominant global reserve currency to the concern that rapid capital account opening poses serious risks for China. A number of recent academic studies have pointed to the renminbi's rising importance in the international monetary System, although these studies are divided on the renminbi's prospects of becoming a dominant global reserve currency (see Eichengreen 2011a, Subramanian 2011, Frankel 2012, and Yu 2012).
- Political Geography:
- China
177. Does Internationalizing the RMB Make Sense for China?
- Author:
- Yukong Huang and Clare Lynch
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The last time a Chinese currency was used as an international medium of exchange was four centuries ago, when China's share of global GDP in PPP terms was nearly 30 percent (about twice its current level), the country was a major global trading power, and Chinese copper coins circulated throughout East Asia to India and even beyond (Horesh 2011). In the following centuries, silver dollars and paper bills replaced copper coins and China's share of external trade declined. Now, with China's return to the position of largest global trader and second-largest economy in the world, it is not surprising that discussion of internationalizing China's currency has resumed.
- Topic:
- Economics
- Political Geography:
- China and East Asia
178. Capital Freedom in China as Viewed from the Evolution of the Stock Market
- Author:
- Zhiwu Chen
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Since reforms started in 1978, China has made commendable progress in achieving capital freedom and individual liberty. Prior to 1978, private enterprises with more than eight employees were prohibited and there were no capital markets. Private entrepreneurs were labeled “Capitalist tails,” and political movements were launched frequently to “cut the capitalist tails.” For several decades, Chinese citizens could only obtain employment and economic means from government organizations and state-owned enterprises, which strictly limited individual liberty. Today there are more than 10 million privately owned enterprises, making up more than 80 percent of each year's employment growth. As a result of less regulation and more room for entrepreneurship, it is relatively easy to register and start a business. Public equity offering opportunities and bank financing are also increasingly available to private firms as well. Chinese, young and old, can choose among jobs provided by government organizations, SOEs, private businesses, and foreign-owned firms. As capital freedom has increased, the rise of the individual and liberty is one of the highlights achieved in China's development over the past 35 years.
- Topic:
- Economics
- Political Geography:
- China
179. The Immigrant War
- Author:
- Alex Nowrasteh
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Some journalists possess a deep knowledge of political and policy debates. Their job is to follow the political developments of a certain policy, report on its effects, and write about it over the course of decades. It's only natural, after so much experience, that they would want to transform their observations and reactions into books that illuminate opaque topics. Vittorio Longhi's The Immigrant War fails at this.
- Topic:
- War
180. Africa's Third Liberation: The New Search for Prosperity and Jobs
- Author:
- Marian L. Tupy
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The new millennium has been good to Africa. Its economy grew at an average annual rate of 4.9 percent between 2000 and 2008. Then came the financial crisis and growth dipped to 2 percent. Since 2009, the International Monetary Fund estimates growth has averaged 5.4 percent. Between 2001 and 2010, six out of the ten fastest growing economies were in Africa. This trend, the Fund predicts, will continue.
- Topic:
- International Monetary Fund
- Political Geography:
- Africa
181. Two Cheers for Anarchism: Six Easy Pieces on Autonomy, Dignity, and Meaningful Work and Play
- Author:
- Jason Kuznicki
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- I often tell aspiring libertarians that they both can and should learn from people who are far removed from them ideologically. Indeed, if they fail to do so, then they are neglecting a vital part of their self-education. When asked whom I have in mind, I almost always mention James C. Scott. Two of Scott's earlier books, Seeing Like a State and The Art of Not Being Governed, are fascinating intellectual excursions for people of the libertarian bent, as well as for many others.
- Political Geography:
- America and Europe
182. How China Became Capitalist
- Author:
- James A. Dorn
- Publication Date:
- 10-2013
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- In 1981, shortly after China began to liberalize its economy, Steven N. S. Cheung predicted that free markets would trump state planning and eventually China would “go 'capitalist'.” He grounded his analysis in property rights theory and the new institutional economics, of which he was a pioneer. Ronald Coase, a longtime professor of law and economics at the University of Chicago and Cheung's colleague during 1967–69, agreed with that prediction. Now the Nobel laureate economist has teamed up with Ning Wang, a former student and a senior fellow at the Ronald Coase Institute, to provide a detailed account of “how China became capitalist.”
- Political Geography:
- China and Chicago
183. Editor's Note
- Author:
- James Dorn
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Immigration has been instrumental in U.S. history in promoting economic development and increasing the range of options open to people. Millions of immigrants have come to America in search of opportunities to improve their lives and to raise their families. They have taken great risks and worked hard to ensure a better and freer future for themselves and their families.
- Topic:
- Immigration
- Political Geography:
- United States
184. Introduction: Is Immigration Good for America?
- Author:
- Daniel Griswold
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The question of whether immigration has been good for America has been on the minds of Americans since the beginning of our republic and continues in the pages of this issue of the Cato Journal. As the United States enters another presidential election year, President Obama has been calling on Congress to enact immigration reform while his administration has been deporting record numbers of unauthorized immigrants. Meanwhile, Republican presidential candidates have been competing with each other to adopt the toughest positions to enforce existing law, including the completion of a fence along the entire 2,000-mile border with Mexico. Outside of Washington, legislatures in Arizona, Georgia, Alabama, and other states have enacted laws designed to make life more difficult for undocumented immigrants.
- Topic:
- Immigration
- Political Geography:
- America, Washington, Georgia, Mexico, Alabama, and Arizona
185. Why Should We Restrict Immigration?
- Author:
- Bryan Caplan
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Consider the following thought experiment: Moved by the plight of desperate earthquake victims, you volunteer to work as a relief worker in Haiti. After two weeks, you're ready to go home. Unfortunately, when you arrive at the airport, customs officials tell you that you're forbidden to enter the United States. You go to the American consulate to demand an explanation. But the official response is simply, “The United States does not have to explain itself to you.”
- Political Geography:
- United States
186. Immigration and Economic Growth
- Author:
- Gordon H. Hanson
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- As the 2012 presidential campaign gets under way, there will be intense public debate about the direction of economic policy. The continuing torpor of the U.S. economy and mounting government debt oblige candidates to detail how they would improve prospects for economic growth and reduce the federal budget deficit. We are sure to hear a great deal about plans to lower taxes, reduce government regulation, improve U.S. education, and rebuild infrastructure. But it is a near certainty that no candidate will make immigration part of his or her vision for achieving higher rates of long-run economic growth. To be sure, stump speeches will contain pat pronouncements about securing American borders, restoring the rule of law, or bringing undocumented immigrants out of the shadows, depending on the candidate's political orientation. Yet, it is a safe bet that after getting through these bullet points candidates will seek to change the subject. Immigration is a divisive issue that most national politicians prefer to avoid. President Obama checked his immigration box by making a halfhearted call for immigration reform in May 2011. That proposal was quickly buried under many more pressing items in his legislative outbox.
- Topic:
- Immigration
- Political Geography:
- United States and America
187. Immigration, Labor Markets, and Productivity
- Author:
- Giovanni Peri
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- According to a survey in 2008, about 50 percent of Americans perceived immigration as a problem rather than as an opportunity (Transatlantic Trends 2008). Similar surveys conducted in the prerecession years of 2007 and before also showed that Americans were much less supportive of more open immigration policies than they were of other aspects of globalization such as free trade or free capital movements (Pew Research Center 2007). Since the onset of the recession of 2008–2009 and during the jobless recovery of 2010–11, public opinion about immigration further deteriorated. The idea that immigrants take American jobs, depress national wages, and threaten the U.S. economy has become even more rooted, as often happens during economic recessions. The political discourse accompanying the economic and labor market impact of immigrants is very intense and pervasive in the media but often generates “more heat than light”.
- Topic:
- Immigration
- Political Geography:
- United States and America
188. America's Demographic Future
- Author:
- Joel Kotkin and Erika Ozuna
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Perhaps nothing has more defined America and its promise than immigration. In the future, immigration and the consequent development of what Walt Whitman (1855: iv) called “a race of races” will remain one of the country's greatest assets in the decades to come.
- Political Geography:
- America
189. America's Incoherent Immigration System
- Author:
- Stuart Anderson
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- If the U.S. Congress and executive branch agencies formulated coherent policies, then here is what our immigration system would look like: highly skilled foreign nationals could be hired quickly and gain permanent residence, employers could hire foreign workers to fill niches in lower-skilled jobs, foreign entrepreneurs could easily start businesses in the United States, and close relatives of American citizens could immigrate in a short period of time. If all those things were true, then we wouldn't be talking about America's immigration system.
- Topic:
- Immigration
- Political Geography:
- United States and America
190. The Economic Consequences of Amnesty for Unauthorized Immigrants
- Author:
- Pia Orrenius and Madeline Zavodny
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Immigration policy reform has reached an impasse because of disagreement over whether to create a pathway to legal permanent residence and eventual U.S. citizenship for unauthorized immigrants. The United States first—and last—offered a large-scale amnesty as part of the Immigration Reform and Control Act (IRCA) in 1986. Despite increased border enforcement and provisions for employer sanctions, the law failed to curtail unauthorized immigration. The 9/11 terror attacks renewed the emphasis on national security and led to stricter policies regarding undocumented immigrants. Over the past decade, border and interior enforcement has increased, while avenues that allowed some illegal residents to adjust to legal status have been eliminated, and a growing number of states have adopted laws aimed at driving out unauthorized immigrants.
- Political Geography:
- United States
191. Immigration and Border Control
- Author:
- Edward Alden
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- For the past two decades the United States, a country with a strong tradition of limited government, has been pursuing a widely popular initiative that requires one of the most ambitious expansions of government power in modern history: securing the nation's borders against illegal immigration. Congress and successive administrations— both Democratic and Republican—have increased the size of the Border Patrol from fewer than 3,000 agents to more than 21,000, built nearly 700 miles of fencing along the southern border with Mexico, and deployed pilotless drones, sensor cameras, and other expensive technologies aimed at preventing illegal crossings at the land borders. The government has overhauled the visa system to require interviews for all new visa applicants and instituted extensive background checks for many of those wishing to come to the United States to study, travel, visit family, or do business. It now requires secure documents—a passport or the equivalent—for all travel to and from the United States by citizens and noncitizens. And border officers take fingerprints and run other screening measures on all travelers coming to this country by air in order to identify criminals, terrorists, or others deemed to pose a threat to the United States.
- Topic:
- International Security and Immigration
- Political Geography:
- United States and Mexico
192. Internal Enforcement, E-Verify, and the Road to a National ID
- Author:
- Jim Harper
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Successful “internal enforcement” of immigration law requires having a national identity system. If expanded, “E-Verify,” the muchdebated effort to control illegal immigration through access to employment, will become such a system, and it could easily be converted to controlling many dimensions of Americans' lives from Washington, D.C.
- Topic:
- Immigration
- Political Geography:
- America
193. Is Birthright Citizenship Good for America?
- Author:
- Margaret Stock
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The Declaration of Independence famously asserted that “all men are created equal,” but this assertion did not become an American constitutional reality until the Fourteenth Amendment was ratified in 1868. The Fourteenth Amendment's Citizenship Clause—intended to overturn the infamous U.S. Supreme Court decision in the Dred Scott (1857) case—states that “All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the state wherein they reside.” Traditionally, the clause has been interpreted to confer U.S. citizenship on anyone born within the United States whose parents are subject to U.S. civil and criminal laws—which has historically meant that only babies born in the United States to diplomats, invading armies, or within certain sovereign Native American tribes have been excluded from birthright American citizenship. Alarmed by the thought that unauthorized immigrants, wealthy tourists, and temporary workers are giving birth to thousands of U.S. citizens, some want to change the long-standing rule by reinterpreting or amending the Citizenship Clause. But will this proposed change be good for America? Will it benefit America to reduce substantially the number of birthright U.S. citizens—and put in place more complex rules that would provide that U.S.-born babies are not created equal?
- Political Geography:
- United States and America
194. Immigration and the Welfare State
- Author:
- Daniel Griswold
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Among the more serious arguments against liberalizing immigration is that it can be costly to taxpayers. Low-skilled immigrants in particular consume more government services than they pay in taxes, increasing the burden of government for native-born Americans. Organizations such as the Center for Immigration Studies, the Heritage Foundation, and the Federation for American Immigration Reform have produced reports claiming that immigration costs taxpayers tens of billions of dollars a year, with the heaviest costs borne by state and local taxpayers. No less a classical liberal than Milton Freidman mused that open immigration is incompatible with a welfare state. Responding to a question at a libertarian conference in 1999, Friedman rejected the idea of opening the U.S. border to all immigrants, declaring that “You cannot simultaneously have free immigration and a welfare state” (Free Students 2008).
- Political Geography:
- United States and America
195. The Economic Benefits of Comprehensive Immigration Reform
- Author:
- Raúl Hinojosa-Ojeda
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The U.S. government has attempted for more than two decades to put a stop to unauthorized immigration from and through Mexico by implementing "enforcement-only" measures along the U.S.-Mexico border and at work sites across the country. These measures have failed to end unauthorized immigration and have placed downward pressure on wages in a broad swath of industries.
- Topic:
- Economics and Immigration
- Political Geography:
- United States and Mexico
196. U.S. Immigration Policy in the 21st Century: A Market-Based Approach
- Author:
- Richard Vedder, Joshua C. Hall, and Benjamin J. VanMetre
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- On most issues of public policy one can predict the position that individuals will take based on their ideological orientation. Immigration policy, however, is one topic where ideological perspective is historically useless in predicting individual positions. The decision of whether or not to liberalize immigration policy or to place greater restrictions on it is something that creates a divide not only between political parties but also within the parties themselves. Peter Brimelow (1999) is one prominent voice from the right who believes that the current immigration policies not only second-guess the American people but threaten the American nation. Brimelow is a strong supporter of placing restrictions on immigration at levels that are much lower than those that currently exist. A similar position is taken by the libertarian political philosopher Hans-Hermann Hoppe. Specifically, Hoppe (1998) argues that the United States will continue to suffer until policies are implemented that subject all migration to the condition of legally binding contractual invitations between the private domestic persons and the arriving immigrants.
- Topic:
- Immigration
- Political Geography:
- United States
197. James Madison
- Author:
- John Samples
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Richard Brookhiser, a longtime senior editor of National Review, has contributed more than most to satisfying the revivified demand for books about the lives and works of the American Founders. He has published books about Washington, Hamilton, the Adamses, Gouverneur Morris, and now James Madison. His biography is both serious and readable.
- Political Geography:
- China, America, and Washington
198. The Ethics of Voting
- Author:
- Aaron Powell
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Grab anyone at a coffee shop, political rally, or cocktail party. Ask him, “Do you think we have a duty to vote?” Chances are he'll say “Yes.” Follow it up with, “Is it because there's something special about voting that places it above other duties we might have, like sayavoiding speeding or paying our taxes?” It's a safe bet you'll get a “yes” to this one as well.Jason Brennan calls the thinking behind these twin affirmatives the “folk theory of voting ethics.” It's the common view of civics classes, straw polls, and town hall meetings. The folk theory is what we all learn in school, along with the three branches of government and the Founding Fathers.
- Political Geography:
- America
199. The Concept of Justice: Is Social Justice Just?
- Author:
- Trevor Burrus
- Publication Date:
- 01-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- Justice is the primary object of political philosophy. Yet, like so many of our highest aspirations, we are prone to use capacious words that can create consensus in their most abstract formulations but engender discord, if not worse, in more specific forms. “Justice” hasalways been like this. During a civil war or an intense political conflict, both sides will preach the justness of their cause, and neither will claim to be fighting on the side of “injustice.”
- Topic:
- War
200. Editor's Note
- Author:
- James A. Dorn
- Publication Date:
- 06-2012
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- This special issue of the Cato Journal stems from the Cato Institute's 29th Annual Monetary Conference—Monetary Reform in the Wake of Crisis—held in Washington, D.C., November 16, 2011. At no time since the founding of the Federal Reserve nearly a century ago has it been more important to reconsider the role of monetary policy in a free society. In particular, as F. A. Hayek noted, “All those who wish to stop the drift toward increasing government control should concentrate their effort on monetary policy.”
- Political Geography:
- Washington