Some Thoughts on Immigration and Its Downside

An academic study released in 2019 found that the children of poor immigrants succeeded in climbing the income ladder much better than the children of poor native-born parents.  This was not only true for immigrants from India, Asia and Europe, but also for those from Africa, the Middle East and Latin America, countries former President Trump labelled ‘shithole’ countries.

The authors theorized that the tendency for these immigrants to live in areas where there are more employment opportunities as well as their willingness to move wherever new opportunities arise might explain some of this difference.  There is also the fact that in some cases, the immigrant parents take jobs at a lower level than they had in their mother country and are not really at a comparable socioeconomic level to the poor in our country.  This may significantly impact the probability of success for their children.

 

In addition to the so-called poor immigrants who achieve social mobility you also have a significant number of immigrants who arrive in the USA as students or skilled workers to fill jobs that might not otherwise be filled.  This is especially true in areas of technology and science.

 

The USA has always prided itself on attracting the best and brightest from across the world.  Our universities eagerly pursue bright international students who are willing to pay the tuition or who are particularly capable, and most of those will stay and work in the USA.  They are also more likely to pursue postgraduate education than native born students and then progress into academia. A whopping 22% of post-secondary education teachers are immigrants!

 

In a world that is beginning to experience population decline in most industrialized nations, immigration is a method to counteract this trend and sustain economic growth.  However, this solution for the so-called first world comes at what certainly must be a high cost for the non-industrialized countries. 

 

For not only are these nations losing their best aspiring students and skilled workers to the lure of the industrialized world, but it is highly probable that the poor emigrants that flee these countries are in most cases a highly motivated and industrious group that constitute a major loss for the mother country as well.  Is it any surprise that many countries remain impoverished and in a failed state when their most valuable resource is being siphoned off?

 

Worldwide competition for people may contribute to innovation and economic prowess in the winning countries, but it also exacerbates many of the problems that plague our increasingly globalized world.  There was a time when the USA could remain blissfully unaffected by the chaos and deprivation outside its borders, but that time is past.  If we cannot find a way to help developing nations retain their best, brightest and most motivated then we will all ultimately suffer.

Memorial Day - Placing a Value on Death?

In the USA we have two federal holidays dedicated to the military – Memorial Day and Veterans Day.  The former specifically honors those who have lost their lives in the wars of our nation, while the latter is a general recognition of all veterans, though still heavily focused on those who died.

The wars of my generation – Vietnam, Iraq and Afghanistan – have been almost universally acknowledged as tragic mistakes and failures.  The loved ones of those who lost their lives (or were horribly maimed) in those conflicts probably find little solace in the idea of a higher cause.  There was no victory, no great achievement, no noble sacrifice.  They must wrestle with the notion that their sons and daughters, husbands and wives, fathers and mothers died for nothing, for no reason at all.

 

I would offer a counter argument, that any sacrifice of a life in good faith, regardless of the outcome, should be honored.  The fireman who rushes into a building to save a child and is killed should be honored even if the child dies or was no longer in the building.  It is the act and intention that counts, not the outcome.

 

But every attempt to place some sort of value on a death must ultimately seem a pitiful effort in the face of the horrible injustice of an early death.  The teenager who dies in a car crash, the child who succumbs to cancer, the young adult who overdoses, the kid who is murdered in a drive-by fusillade, the school children massacred in a mass shooting – the incomprehensible tragedy of it all haunts us.

 

Death, even in old age, unleashes a barrage of painful implications – the loss of a loved one and the horrific realization that one will never see them again; the potent reminder of our mortality and the rapid falling of the sand in our own hourglass; the question of life’s meaning and the troubling enigma of our existence.   And these thoughts are ever so much more poignant and relentless when the death is a youthful one.

 

Yes, time does partially heal the wounds.  And yes, we are resilient creatures who carry on even in the face of all of our doubts and fears.  And yes, there is joy to be had in this life no matter what hardships and tragedies confront us.  But death, and especially the death of the young, is never easily rationalized, and it remains a confounding aspect of our lives and rattles our faith and our spirit.  Attempting to place a value on a death is to a great extent a self-delusion, and I wonder whether it offers any real consolation.

 

AI and Genetic Engineering - Twin Horsemen of the Apocalypse?

The tsunami of fawning and fearful AI articles in the media over the last few months is breathtaking.  It might lead one to wonder whether chatbots are auto-generating all of these articles as part of an evil ploy to create widespread panic and prepare the world for AI’s takeover!  

The hyperbole reminds me of the hysteria that has frequently accompanied news events associated with genetic engineering.  These two technology frontiers are flip sides of the same coin – changing the basic nature and scope of humanity.  They are simultaneously thrilling and terrifying, harbingers of a very uncertain but intriguing future world.

 

Artificial Intelligence (AI) has been a topic of discussion for several decades.  And like much of technology jargon, it is a very broad term that people overuse to either make themselves seem knowledgeable or, in this case, to sell content to a public hungry for apocalyptic rumors and new things to obsess about.

 

So, what is AI?  Wikipedia defines it as:  intelligence—perceiving, synthesizing, and inferring information—demonstrated by machines, as opposed to intelligence displayed by humans or by other animals.

 

On the one hand, one can argue that all computer applications, and even many mechanical or electrical machines, are exhibiting artificial intelligence, in that they are independently performing tasks that mimic human tasks or behavior.  This type of artificial intelligence is confined to specific tasks and limited by the set of instructions that a human being has programmed into the computer. The tasks can be quite complicated, but they are constrained to act in a previously defined manner.

 

But when computer scientists talk about AI, they are more likely talking about systems and software that can ‘learn’ to perform a task rather than just perform the task.  These learning systems rely on massive amounts of data to adapt their capabilities, just as we humans require years of training to learn to understand, speak, move, and reason.  How closely these machine learning algorithms mimic our own brains is difficult to say, as we are still in early days of understanding the human brain’s inner workings.

 

The point of these machine learning systems is to enable computerized systems to perform tasks that would be impossible for previous pre-programmed systems – for example, recognizing objects or faces, driving cars, or creating unique content or images.  The learning systems are essentially writing their own code, or at least adapting it as they go through a process of trial and error.

 

The ability for learning systems to adapt and change has both advantages and disadvantages.  The advantage is obvious – that they can accomplish far more than their earlier fixed-program brethren.  The disadvantage, and the thing that provokes understandable fear and hysteria in the media and even among many of the pioneers in this technology, is that once these programs are unconstrained, there is the possibility that they will do unexpected and even unwanted things.  The danger is that we will lose control of how their software grows and how they ultimately behave.

 

This unpredictability is not a big problem in an AI-driven autonomous vacuum cleaner, but it could be a problem in autonomous vehicles, drones, robotic soldiers, and yes, even content generating applications like chatgpt.

 

AI is ultimately seeking to aid or replace human intelligence with a potentially unbounded and unregulated alternative intelligence.  Genetic engineering, on the other hand, offers the capability to change the human vessel itself.  Though currently held somewhat in check by international agreements, the capability to edit gene sequences and alter genomes tempts us to both repair and optimize human beings with all of the inherent uncertainties and risks.  As in all technological advancement, there is potential for both good and evil, and for a whole plethora of unintended consequences.

 

Can future AI and genetic engineering efforts be regulated in such a way as to put controls or curbs in place and ensure that no harmful consequences ensue?  This is the difficult challenge that faces the world today. The genies are already out of the bottle.  If we lose control of them, or even more sadly, employ them indiscriminately in a mad arms race for power and global dominance, then the apocalypse may be just around the corner.

 

The Poverty Duet

The USA has been the most powerful nation on earth for at least 80 years.  As the only nation to exit WW2 with a booming economy and intact infrastructure, the USA became the world’s department store, economic engine and bank.  The malaise of the depression was finally over, and the poverty rate in the country, which had soared in the 1930’s during the Great Depression, swiftly declined through the war years and into the 50’s and 60’s.  

When Lyndon Johnson declared a war on poverty in 1964 as part of his Great Society legislative agenda, the poverty level was at about 19%.  Many believed that the country could indeed ‘conquer’ poverty and render it obsolete.  By the time Johnson left office in 1969, the poverty rate was about 12%.  It has stubbornly remained between 12 and 15% ever since, through both republican and democratic presidencies and various permutations of congressional majority. 

 

Conservatives and liberals have endlessly debated the surprising intractability of poverty in the world’s richest nation.  The debate has become a predictable duet, albeit an atonal one without harmony or grace.  Neither statistics nor data nor studies succeed in convincing the opposing sides to alter their religiously held convictions.

 

Here are what I perceive to be some of the opposing tenets of both the conservative and liberal points of view:

 

It is telling, and ironic, that the first bars of the poverty duet can be heard in the critique by both sides of the definition of poverty itself!

 

C: The number of citizens that live in true poverty is much less than the census bureau calculates because of food stamps, subsidized housing, Medicaid and other entitlements that are not considered in the poverty threshold.  Is it poverty when 64% of people defined as impoverished have Internet and 78% have air conditioning?

L:  The number of impoverished people is significantly higher than calculated because of the high costs of housing, healthcare and transportation as well as the debts that occur from unexpected events such as job loss, health crises or car repair, for example.

 

C:  Poverty can only be reduced by economic growth and job production.  Welfare programs are counter-productive and create dependencies and encourage poor behavior.

L:  Trickle-down economics is a failure.  Enlightened government efforts to provide aid, childcare subsidies and job-training/education, and lift wages are necessary to reduce poverty.

 

C:  Wealth and income inequality concerns are attempts to create class warfare and envy.  Further taxing the rich will have a negative effect on investment and economic growth.

L:  Grotesque wealth inequality is not healthy.  Income and estate taxes on the super wealthy can subsidize infrastructure improvements, education, childcare and other means to reduce poverty and improve outcomes for the poor.  The rich will still have plenty of money to invest or build new companies.

 

C:  Effort and ability determine success and economic status.  There are no longer structural or systemic barriers making it more difficult for racial or ethnic groups to succeed.

L:  The legacies of racism and bias against immigrants or non-whites are still present even if outright discriminatory practices have generally been eradicated.  Federal, state and local governments must be proactive in removing these barriers.

 

C:  Prior efforts to reduce poverty through welfare have encouraged single parent families and absent fathers with the resultant avalanche of crime, gangs, drugs and incarceration.

L:  The disastrous tough-on-crime stances and war on drugs, with the resultant extreme levels of incarceration, have created a vicious cycle of addiction, incarceration, crime and unemployment.

 

C:  A focus on racism, identity and historical flaws of the USA creates division and pessimism, and distracts people from the task of improving their lives and prospects through hard work and education.

L:  America must confront its past in order to learn from it and correct the remaining structural inequities.

 

C:  Any attempt to increase wages through mandatory minimum wage laws will harm businesses and end up causing increased unemployment and recessional pressure.

L:  Minimum wage laws increase the spending power of the poor and will actually accelerate business growth (the Henry Ford example) rather than hamper it.

 

These are just a few of the verses, but the duet goes on and on.  Poverty, like so much of the conservative/liberal divide, is a complex topic with plenty of room for interpretation of statistics and theorizing.  There are some nations who have come close to creating a society with little or no poverty – the Scandinavian nations come to mind.  But even in those somewhat homogeneous nations there is a significant portion (3-7%) of the population that is considered to be at a poverty level, though the definition of poverty in all nations is relative and hard to compare.

 

The world will never be perfect, and inherent in human nature are all sorts of troubling contradictions.  There is likely a certain percentage of people whose habits and behavioral traits doom them to poverty and even homelessness.  There is only so much one can do to improve their lives.  However, a truly civilized society should be absolutely determined to provide all hard-working and earnest citizens with enough infrastructure (education, housing, childcare, healthcare, transportation, Internet) and safety nets (nutrition programs, temporary assistance during crisis, Medicaid, etc.) to create a dignified and fulfilling human existence.  

This should be the part of the song where the duet rises to a harmonious chorus.

The Next Pandemic

COVID-19 is still with us, though its toll has subsided to a level (about 150/day in the USA) that no longer seems to trouble most people.  There are vaccines available and most of the deaths are associated with co-morbidities of age and obesity.  COVID will take its place in the pantheon of diseases and kill tens of thousands of Americans each year, just as influenza and other diseases do.  It has gone from pandemic to endemic.

The days of social distance and mask mandates are pretty much gone, but the debates about measures taken during the pandemic have never been resolved and will no doubt play a strong role in the next pandemic.  Are shutdowns necessary? Do masks and mask mandates work? Should schools and churches be closed?  Should vaccines be mandated? These are the questions that will reverberate as soon as the next scary disease appears on the horizon.

 

The astounding success of the race to create a vaccine and its successful rollout should make all of us stand up and applaud.  But sadly, many of our citizens have already forgotten the horrors of the first few months of the COVID plague.  Italy, Spain, China, New York City, London – the juggernaut of death and disease that ravaged those areas was incredibly frightening, but somehow as the disease’s impact waned over the last 3 years people have come to strange conclusions about what actually occurred and what measures are appropriate.  Sometimes I even hear people say that we should never have gone into shutdown.  I shake my head in amazement.  

 

There will always be a tension between public health needs, economic needs and individual freedom. Clearly it is desirable to minimize the impact of health directives and mandates on the economy and personal liberty.  But when a true pandemic occurs, or is looming, the government must do whatever is necessary to limit mortality and contagion.

 

The most critical goal of public health measures during a pandemic must be to safeguard our healthcare system and prevent it from being overwhelmed.  If healthcare workers, facilities and equipment cannot keep up with the rate of infection and the treatment of the sick, then the death rate will spiral out of control and the healthcare workers will also get sick and die or become exhausted. This occurred in the initial phase of the COVID pandemic in New York City and many other areas.  Preventing this scenario must be the first priority of the government.

 

It is possible that less densely populated areas may not require the extreme levels of shutdown or other measures that major metropolitan areas require, but it is tricky to implement different levels of public health measures effectively.

 

Mask-wearing and vaccines became highly politicized in the USA, much more so than in other countries.  At a basic level it is pure idiocy to argue that vaccines and masks are unnecessary or should be voluntary.  In the face of a deadly and highly contagious disease, it makes no sense at all to argue that personal liberty should be given priority over public health.

 

We have required vaccination of children in this country for years and the results in terms of childhood mortality and disease are clear and incontrovertible.  The data on the COVID vaccines are similarly convincing.  Granted, there was some understandable concern about the rapidity of the vaccine development and the novel technology, but the trial results and ongoing lack of significant side effects or dangerous reactions were quite convincing.

 

It is more difficult to accurately analyze the effectiveness of masks, but masks have been required in hospital operating rooms and infectious disease wards for the last century and have contributed to a much lower infection rate in those environments.  

 

There is a recent study that questions the effectiveness of mask mandates, but that study acknowledged that its confidence level was low and that such studies are very dependent on how compliant people are in wearing masks.  Direct scientific studies of mask effectiveness have confirmed that they are quite effective when utilized correctly.  And wearing a mask in public spaces is hardly a big imposition on people.  The level of hysteria over mask mandates, like so many other political litmus tests, is really quite absurd.

 

When the next pandemic arrives, as it inevitably will, there is good reason to fear that the true lessons of COVID-19 will have faded and that there may be passionate opposition to taking strong measures to contain it.  Let us pray that the people in power at that time will act on scientific and medical guidance and avoid political gamesmanship.  Our very lives will depend on it.

 

 

America Loves Big

We went on a road trip recently with my electric vehicle and had to stop several times for charging.  One of our supercharger stops just happened to be next to a Buc-ee’s, the new roadside phenomenon which appears to be a Cracker Barrel on steroids.  It was immense!  There was food, clothing, knick-knacks and oh so much more in a colossal building surrounded by perhaps a hundred gas pumps accommodating even the largest RVs and trucks.  

I purchased a brisket sandwich for about $10, passing up the massive slabs of beef jerky that came in every possible flavor.  There were scores of the brisket sandwiches in a warming shelf along with every other conceivable snack or lunch item.  Even with the endless stream of people coming in and out there was almost no wait at the checkout counter.

 

On my way back to the car I marveled at the hulking automobiles and trucks along the way -  SUVs the size of tanks, pickup trucks so long and wide that they bulged over the lines on the parking spaces.  Even the sedans are half again as large as they were 10 or 15 years ago.

 

America loves big.  Big houses, big cars, big yards, big refrigerators, big couches, big beds, big guns.   We eat big meals and port big bellies and big thighs.  We dream big dreams and launch big projects.  We aren’t satisfied until we make it big.  We won’t rest until all our big desires are met.  

 

Perhaps it is the size of our country, with its vast open spaces, that has accustomed us to seeking, constructing or demanding big things.  Or perhaps it is the rapid development of our status as the dominant world economy and military power that makes us prefer things that are bigger than the things that the rest of the world finds sufficient.  Or maybe it is the thought that we are God’s chosen land, the ‘shining city on a hill’, a land with a ‘providential mission’, that makes us feel we deserve bigger and better.

 

All empires have their time in the sun.  America has dominated the world for the last 100 years or more and has spread its love of big far and wide.  One can see grotesquely large SUVs squeezing through the delicate cobblestone streets and alleys in Europe these days and observe obese fast food aficionados leaving McDonalds with their huge sugary drinks all around the world.  We have exported big and made it a cultural contagion. 

 

Lest I sound too critical of my fellow citizens, I will note that our love of big is simply a vanguard.  Everyone seems to love big once they have the chance to experience it.  Big is an addiction that rivals drugs and social media.  Every human being can learn to love big.

 

There are a few things on the horizon that may eventually dim the beckoning light of big things – climate change, global inequality, excess population, massive resettlement and political instability to name a few.  Can we transfer our allegiance to small?  Can we learn to be content with more diminutive and petite things in our lives, and fewer of them?  Humans are very adaptable creatures and I am confident we will make the move when the time comes, painful as it may be.

Debt and Taxes

As we face the bitter annual battle about increasing the debt limit, it is interesting to take a look at how we got here and what could be done to improve the situation.

The current national debt is approximately $31.5 trillion.  Our budget deficit for 2022 was approximately $1.4T for a budget of about $6T, which means that we increased our debt by about 4.4% in 2022.  

 

The last time we had a budget surplus was 2001, when the surplus was $130B.  After that, two things contributed to create significant deficits (from $160B to $450B) from 2002 to 2008:  major tax breaks instituted by the Bush administration and the Afghanistan and Iraq wars.  

 

The 2008 financial crisis increased the budget deficit dramatically in 2009 to $1.42T and it slowly decreased after that until the Trump tax cuts in 2017 started another upward trend and the deficit reached $1T in 2019.

 

The last 3 years have seen a major increase in our debt due primarily to the impact of COVID. The deficit for 2020 was over $3T, and in 2021 it was $2.8T (double that in 2022). 

The current debt is approximately 125% of the national GDP (Gross Domestic Product).  Our interest payments on this debt are about 15% of our spending.  But it is interesting to note that only about 25% of those debt payments go to foreign investors.  The rest is either intragovernmental or paid to US institutions, mutual funds, bond holders, etc.  Compared to other developed nations, the USA is near the top in terms of ratio of debt to GDP, but not the highest.  Japan wins that award at over 230%!  For comparison, Italy has 135%, France 98%, the UK 80% and Germany 60%.  

 

Yet American investments, securities and currency are still the most desirable in the world.  So clearly the world doesn’t yet view the USA as having a huge debt issue or any type of impending disaster.  But most economists seem to feel that we must work to limit or even reverse debt growth as we face a more challenging period of social security and Medicare expenses from an aging population, as well as likely growth in defense spending.

 

The budget deficit can be decreased by spending less and/or taxing more.  There is always waste in government. The passionate feelings that fiscal conservatives have about reducing government are not unreasonable, but they run into hard numbers of required spending pretty quickly.  

 

Social Security is $1.2T and Health Care (Medicare, Medicaid, Children’s Health Insurance Program and Affordable Care Act subsidies) come in at $1.4T.  Along with some other mandated costs they make up about 65% of our $6T spending, and those costs will only increase as time goes on unless we are willing to cut them, which is generally a very unpopular concept!

The defense budget is about 16% of the federal budget.  Here is the overall breakdown of the federal budget.

And a more detailed look at discretionary spending:

I partly agree with the part of conservative thought that fears the steady, unexamined expansion of government.  There is nothing evil about this expansion, it is simply entropy at work.  It seems to me that there should be some bi-partisan group tasked with closely monitoring government spending and making recommendations to congress for reductions. 

 

Admittedly, this would be a near impossible job and subject to all sorts of political machinations, but it is worth a try.  The Congressional Budget Office (CBO) does some of this work, but more along the lines of estimating costs than analyzing the cost-effectiveness or value of government programs.

 

But no matter how much effort is put into attempts to reduce our current spending, it is highly unlikely we will be able to balance the budget in this manner.  

 

With that in mind, let us look at taxation in the USA and see what can be done there!  Here are some facts about taxes for the highest earners:

• Top 1%. (1.6M taxpayers) had average adjusted earnings of $1.6M per taxpayer and paid 25.6% in tax, or an average of $413k per taxpayer.  The total of their taxes was $612B.
• Top 10% (14.8M) had average adjusted earnings of $380k per taxpayer and paid 19.9% in tax, or an average of $75k/taxpayer.  Their total of taxes was $1.12T.
• The bottom 50% (74M taxpayers) had average adjusted earnings of $18k per taxpayer and paid 3.5% in tax, or an average of $653/taxpayer.  Their total taxes were $48B out of a total tax revenue of 1.58T

 

The top 10% of taxpayers had a total of $5.6T in adjusted income (after deductions and all the legal maneuvering).  If they paid another 10% in taxes, that would give the country $560B in revenue and would only decrease their average income from $380k to $342k.  This additional tax could be structured in a graduated manner so as to have less effect on those down at the $200k-$400k level.

 

The effect of this additional taxation would be minimal in terms of the lifestyles of the wealthy.  Opponents of tax increases believe fervently that increased taxation on the wealthy will somehow decrease investment and throttle growth.  The top 10% of wage earners have so much accumulated wealth that it is very hard to imagine that they would limit their investments or somehow quit innovating or creating new companies.

 

I have seen many arguments by the Heritage Foundation and other conservative organizations framing the argument around share of taxation and income.  They fall all over themselves pointing out that the rich pay a much higher share of taxes (71%) than their share of income (48%).  

 

But this is looking at the situation backwards.  The salaries and wealth of the rich are so large that they can afford to pay much more in tax and still have everything they need for their lifestyles and their business investments.  In contrast, the poor and even the middle class struggle to keep their heads above water.  

This is why large numbers of billionaires and multi-millionaires have declared their support for significant increases in their taxes.  Increased taxes on the wealthy would also begin to move us away from the dangerously inegalitarian society that has developed over the last 40 years.

 

In the long run we will need to make significant changes in both our taxation and government spending.  But the first step needs to be to increase taxes, both income and estate, at the upper end of the scale.