The economy, stupid!

Yesterday former Pres. George W. Bush called for a "benevolent spirit" toward immigrants, calling them the bedrock of the our nation's economy. I think I understand his point, but it depends on what economy he was talking about. Many illegal immigrants were "allowed" to enter our economy as cheap labor. Cheap labor may help some sectors of our economy but it undercuts other sectors. The agricultural sector, for instance, has profited from illegal immigrant labor but at the expense of many poor citizens who might not feel so benevolent.

Like many citizens the bedrock of my economy, until I retired, was a job. My job was teaching and immigration probably gave me more good students. But I am sure many of the immigrants I taught went on to take jobs from non-immigrants. For citizens who are entrepreneurs the bedrock of their economy is a thriving business. In their case immigrants might provide an economic opportunity, serving as cheap labor and additional customers. Or the the immigrants might become strong competitors.

What is "our nation's economy"? We can measure it in dollars, jobs, stock market averages, national debt, and percentages of improvement or loss, but these figures obscure the heart of it. The figures are simply averages or sum totals of millions of individual economies. The nation's economy is really the sum total of the well being of all our citizens, native born or immigrant. And--Supreme Court take note--it does not include the well being of our corporations. They are not citizens and, in fact, many of them are multinationals. If they can profit by hurting our nation's economy, they will.

Also in today's news we learn that corporations cannot even agree on how to avoid the fiscal cliff. Some corporations, particularly smaller ones, declare their taxable income as persons. If the fiscal cliff is avoided by increases in personal tax rates or elimination of personal deductions those corporations will suffer while larger corporations are unaffected. Pity the poor Senators and Representatives who must decide whose economy to ruin. Those lobbyists and constituents will not be happy.

Basically the whole battle about how to avoid the fiscal cliff revolves around the definition of our nation's economy. Both sides and many economists are worried that falling over the cliff will trigger another recession. But a recession is just one of those national averages. All of the various proposed fixes will benefit some citizens at the expense of others. Those choices cannot be avoided. The difference between good and bad choices is simply in the breadth and degree of hurt. Some people call this "fairness."