The Wall Street Journal claimed that because private investment typically precedes infrastructure projects, President Obama's call for increased infrastructure investments is misguided. This position, however, ignores the historically positive effect of public investment on private activity and the nation's current need for infrastructure improvements.
In a series of recent speeches on the economy, President Obama has repeatedly called for increased infrastructure investment, claiming "[it] is a key ingredient to a thriving economy." In his July 30 speech in Chattanooga, TN, the president proposed combining a corporate tax rate cut with "new spending on infrastructure projects like roads and bridges."
Reacting to the president's push for increased infrastructure spending in The Wall Street Journal, University of Dayton history professor Larry Schweikart and Hillsdale College history professor Burton Folsom claimed that Obama is ignoring the history of infrastructure in the United States.
According to the authors, the president's position amounts to, "Create the infrastructure, in other words, and the jobs will come," which does not comport with historical evidence. The authors cite a number of examples -- the National Interstate and Defense Highways Act of 1956, the transcontinental railroad, and the Erie Canal -- all of which they use as evidence that private demand spurs the need for investment and not the other way around:
In all of these examples, building infrastructure was never the engine of growth, but rather a lagging indicator of growth that had already occurred in the private sector. And when the infrastructure was built, it was often best done privately, at least until the market grew so large as to demand a wider public role, as with the need for an interstate-highway system in the mid 1950s.
While it may be true that infrastructure typically follows private sector growth, this myopic view on the nexus between private and public investment completely ignores that infrastructure spending can further bolster private activity.
In fact, the authors' example of interstate highway development demonstrates how public investment can support private interests. According to a multitude of studies conducted by M. Ishaq Nadiri and Theofanis Mamuneas for the Federal Highway Administration, public investment in highways consistently results in positive gains for private industry, including productivity growth and general economic development. Indeed, in an overview of studies on the effect of public infrastructure investments on the U.S. economy, economists Alfredo Marvao Pereira and Jorge M. Andraz find that public investment complements private activity, with core infrastructure investments delivering the greatest returns.
The Wall Street Journal's Bret Stephens falsely claimed the embassy closures in the Middle East and Africa proved that President Obama had wrongly characterized the current threat of terror in his May speech on national security, when in fact the president specifically referred to threats from al Qaeda affiliates in Africa and the Middle East against diplomatic facilities.
Following the announcement that 19 U.S. embassies and consulates in the Middle East and Africa would remain closed throughout the week with hundreds of additional security forces deployed to the U.S. Embassy in Yemen due to suspected terror threats, conservative media rushed to politicize the effort to protect American lives, dismissing security experts who praised the decision and falsely accusing President Obama of failing to recognize the realities of the war on terror.
Stephens furthered these attacks in his August 5 Journal column, claiming that the embassy closures revealed "a threat that makes a comprehensive and vivid mockery of everything the president said" in Obama's speech at the National Defense University on May 23. According to Stephens, the purpose of the president's national security speech was "to declare the war on terror won--or won well-enough--and go home," and the "facts and analysis" Obama used to discuss the nature of al Qaeda were proven "wrong" by the current situation in Yemen and the Middle East.
But Stephens ignored whole portions of Obama's speech in which he identified the very types of threats the intelligence community is working to avert. Obama's speech specifically referred to al Qaeda affiliates in the Middle East and Africa -- including Yemen, Libya, and Syria -- as "the most active in plotting against our homeland" and acknowledged they posed "threats to diplomatic facilities and businesses abroad" (emphasis added):
Today, the core of al Qaeda in Afghanistan and Pakistan is on the path to defeat. Their remaining operatives spend more time thinking about their own safety than plotting against us. They did not direct the attacks in Benghazi or Boston. They've not carried out a successful attack on our homeland since 9/11.
Instead, what we've seen is the emergence of various al Qaeda affiliates. From Yemen to Iraq, from Somalia to North Africa, the threat today is more diffuse, with Al Qaeda's affiliates in the Arabian Peninsula -- AQAP -- the most active in plotting against our homeland. And while none of AQAP's efforts approach the scale of 9/11, they have continued to plot acts of terror, like the attempt to blow up an airplane on Christmas Day in 2009.
Unrest in the Arab world has also allowed extremists to gain a foothold in countries like Libya and Syria. But here, too, there are differences from 9/11. In some cases, we continue to confront state-sponsored networks like Hezbollah that engage in acts of terror to achieve political goals. Other of these groups are simply collections of local militias or extremists interested in seizing territory. And while we are vigilant for signs that these groups may pose a transnational threat, most are focused on operating in the countries and regions where they are based. And that means we'll face more localized threats like what we saw in Benghazi, or the BP oil facility in Algeria, in which local operatives -- perhaps in loose affiliation with regional networks -- launch periodic attacks against Western diplomats, companies, and other soft targets, or resort to kidnapping and other criminal enterprises to fund their operations.
So that's the current threat -- lethal yet less capable al Qaeda affiliates; threats to diplomatic facilities and businesses abroad; homegrown extremists. This is the future of terrorism. We have to take these threats seriously, and do all that we can to confront them. But as we shape our response, we have to recognize that the scale of this threat closely resembles the types of attacks we faced before 9/11.
Stephens concluded by attacking the media's "memory" of the speech, claiming the press had forgotten the realities of Obama's rhetoric in favor of praising the administration. But it's Stephens himself who seems to have forgotten whole sections of the speech that undermine his attack on the administration, which has worked to protect American lives by effectively responding to a type of terror it identified as many as four months ago.
Earlier this summer, the Supreme Court struck down a key provision of the Voting Rights Act that helped force states and localities with a history of discrimination to have the Justice Department preclear proposed changes to voting regulations. Representative John Lewis (D-GA), a civil rights icon, described the decision as "a dagger in the heart of the Voting Rights Act of 1965."
Today marks the 48th anniversary of President Lyndon Johnson signing that act into law.
Conservatives are apt to defend gutting the law by arguing that our country has made significant strides in racial equality over the past 48 years. That being the case, one would hope that segregationists' arguments against the Voting Rights Act of 1965 would have been relegated to the dust bin of history, rather than in use by conservatives today to defend discriminatory policies.
Unfortunately, much of the rhetoric used to attack the law and defend the Supreme Court's decision remains rooted in the segregationist defenses of Jim Crow. Regardless of the motives, the use of similar rhetoric shows a lack of historic perspective.
Keith Finley, a professor of history at Southern Louisiana University and author of Delaying the Dream: Southern Senators and the Fight Against Civil Right, has detailed many of the arguments made by Senators from the old South as they fought the Voting Rights Act of 1965 on the floor of the chamber.
One such tactic was to accuse civil rights activists of aggravating racial tensions. According to Finley, Virginia Senator Henry Byrd, an opponent of the 1965 Voting Rights Act, claimed Lyndon Johnson would only increase racial tensions by "inflaming so-called civil rights issues" if he pursued the legislation.
Forty-eight years later, that defense remains a go-to of civil rights antagonists.
Two weeks ago, Fox host Bill O'Reilly told his the audience that civil rights leaders want "to divide the country along racial lines because that's good for business." While O'Reilly was specifically referring to reaction to the George Zimmerman verdict among civil rights leaders, similar sentiment has been expressed throughout the right in defense of the court's decision to gut the Voting Rights Act.
When Attorney General Eric Holder announced that the Justice Department would use available tools to continue enforcing the Voting Rights Act, Fox's Eric Bolling accused the nation's first black attorney general of "thumbing his nose at the Supreme Court so he can widen the race divide in America." Nina Easton, a Fortune columnist, said on Fox's Special Report that Holder's move was part of an "ongoing electoral strategy by this administration to gin up the black and Latino vote."
The fight to defeat the Voting Rights Act in 1965 also hinged on pivoting away from the central issue of voting rights to the canard of defending the process. According to Finley, Louisiana Senator Allen Ellender claimed race had nothing to do with his opposition to the Voting Rights Act. Instead, Ellender argued that he was simply maintaining the integrity of the electoral process: "the task of making it clear that one is not against voting rights, but only in favor of maintaining voting qualifications, is not always an easy one."
The same tactic is alive and well nearly five decades later and is made frequently by those advocating for strict voter ID laws, which experts say will disenfranchise minority voters.
When Mother Jones' David Corn published the internal deliberations of Groundswell, a right-wing listserve, one of the debates he highlighted centered on the issue of voter ID laws:
A high-priority cause for Groundswellers is voter identification efforts--what progressives would call voter suppression--and when Groundswellers developed a thread on their Google group page exploring the best way to pitch the right's voter identification endeavors as a major voting rights case was pending in the Supreme Court, the coalition's friendly journalists joined right in. Dan Bongino, the ex-Secret Service agent and 2012 Senate candidate, kicked off the discussion: "We need to reframe this. This narrative of the Left has already taken hold in MD. The words 'Voter ID' are already lost & equated with racism. Maybe a 'free and fair elections initiative' with a heavy emphasis on avoiding ANY voter disenfranchisement combined with an identification requirement which includes a broader range of documents."
In response, Tapscott suggested, "How about 'Election Integrity'?" And Gaffney weighed in: "I like it." Fitton noted that Judicial Watch had an "Election Integrity Project." Boyle proposed, "Fair and equal elections," explaining, "Terms 'fair' and 'equal' connect with most people. It's why the left uses them." Then came True the Vote's Anita MonCrief: "We do a lot under the Election Integrity Banner. Does not resonate with the people. Voter Rights may be better. We really have been trying to get the messaging right."
Hans von Spakovsky, a fellow at the Heritage Foundation and leader in the conservative movement's war on voting, wrote in USA Today that voter ID laws were "to ensure the integrity of our election process."
Rush Limbaugh told his audience that Democrats only oppose voter ID laws "because that would have a very negative impact on cheating."
Finley points to Herman Talmadge, a Senator from Georgia, who claimed the 1965 Voting Right Act was unnecessary because the "[right to vote] is probably the most protected right we have." Echoes of Talmadge could be heard in the aftermath of the Supreme Court's decision this summer. The Wall Street Journal argued the Voting Right Act was "no longer necessary" due to "American racial progress."
Speaking about the Supreme Court's decision on Fox, network contributor Andrew Napolitano cheered the court's ruling, claiming the section stuck down "worked so well" that "the procedure is not necessary anymore."
Von Spakovsky claimed in 2011 there was "a complete lack of evidence that the type of systematic discrimination that led to [the 1965 Voting Rights Act's] initial passage still exists."
This 48th anniversary of the Voting Rights Act provides conservative media figures an opportunity to revisit the historical context of the language they use to confront issues of races, and begin to engage in a real conversation.
Karl Rove ignored the Republican obstructionism that led to the 2011 debt ceiling crisis, falsely claiming President Obama was entirely to blame for automatic government spending cuts and misleadingly accusing Obama of hypocrisy for criticizing the devastating effects of the law.
In his July 29 Wall Street Journal column, Rove accused Obama of hypocrisy while ignoring Republican responsibility for the devastating automatic spending cuts enacted March 1 known as sequestration, claiming Obama was fully to blame for the cuts because he signed the 2011 Budget Control Act. That law raised the U.S. borrowing limit while providing the framework that ultimately resulted in sequestration:
Mr. Obama proposed the sequester, signed the July 2011 budget agreement with its hard caps on discretionary spending, and threatened to veto any attempt to repeal or mitigate it. Nevertheless, last week he attacked the sequester as "a meat clever" that "cost jobs" and later told the New York Times Sunday that he's worried about "the drop-off in government spending."
But Obama only signed the Budget Control Act after Republicans took the U.S. economy hostage by threatening not to raise the U.S. debt ceiling -- a measure passed to allow Congress to pay for past spending. According to a C-SPAN timeline of the debt ceiling crisis, on May 11, 2011 House Speaker John Boehner (R-OH) pledged to "not support debt limit increase without equal amounts of spending cuts." Previously, measures to raise the debt ceiling were routinely passed.
In the months following Boehner's pledge, Republicans dismissed the concerns of economists of every partisan disposition that failing to raise the debt ceiling would be catastrophic for the U.S. and world economies. A June 2011 letter to congressional leaders signed by 235 prominent economists warned:
Failure to increase the debt limit sufficiently to accommodate existing U.S. laws and obligations also could undermine trust in the full faith and credit of the United States government, with potentially grave long-term consequences. This loss of trust could translate into higher interest rates not only for the federal government, but also for U.S. businesses and consumers, causing all to pay higher prices for credit. Economic growth and jobs would suffer as a result.
These automatic spending cuts were designed such that the consequences of letting them occur would be so severe that it would force Congress to adopt a balanced approach to spending reduction targets laid out in the Budget Control Act. Indeed, Obama and congressional Democrats made a number of proposals to avoid sequestration, but Congress failed to find an mutually-acceptable approach, with Republicans ultimately insisting that any deal only contain cuts and no revenue. Because they failed to reach a deal, sequestration went into effect.
But ignoring history and shifting blame away from the GOP and attacking Obama is par for the course for Rove. Indeed, in an August 2012 Wall Street Journal column, Rove ignored Republican obstructionism to blame Obama for failing to pass immigration reform or a deficit reduction deal, and for the debt ceiling crisis.
Right-wing media reacted to President Obama's proposal to lower the corporate tax rate by pushing the repeatedly debunked claim that a majority of small businesses pay the top individual income tax rate. In fact, only a small fraction of small businesses pay this rate, and Obama's plan includes other incentives to help them.
A member of The Wall Street Journal editorial board attacked decades-old employment discrimination precedent under Title VII by incorrectly describing the law and selectively quoting a letter written by nine Republican attorneys general to support her faulty argument.
WSJ editorial board member Mary Kissel has a history of smearing civil rights precedent that holds racial discrimination is illegal if it has an unjustified disproportionate effect on historically protected groups. Kissel has written editorials that falsely pretend this current body of law is improper and any government official that utilizes or seeks to defend the doctrine is "shady."
As the enforcement of civil rights law - including disparate impact law - is the job of the Department of Justice, Kissel's editorials have nicely dovetailed with the WSJ's constant support of GOP obstructionism and its attacks on the Voting Rights Act, former Civil Rights Division head Thomas Perez, Attorney General Eric Holder, and seemingly anyone else who worked at the Department of Justice.
In her most recent editorial criticizing new civil rights guidance from the Equal Employment Opportunity Commission (EEOC), Kissel fails to mention that the policy she is attacking is once again a disparate impact one, well-established in Title VII employment discrimination law. From the WSJ:
The Equal Employment Opportunity Commission has run amok under chairwoman Jacqueline Berrien's guidance, particularly in its extralegal push to expand civil-rights protections for the likes of murderers and rapists. So it's welcome news to see state attorneys general shedding some light on the situation.
Nine Republican AGs, from states stretching from Montana to South Carolina, penned a letter to Ms. Berrien and the commission last week complaining about the "substantive position" the agency has taken against retailer Dollar General and a U.S. subsidiary of car maker BMW. The EEOC contends the companies broke federal law by using criminal background checks in employment decisions.
The AGs rip apart that legal theory, noting that Title VII of the 1964 Civil Rights Act prohibits discrimination "on the basis of race, color, religion, sex, or national origin," not criminality, and that "neither lawsuit alleges overt racial discrimination or discriminatory intent." The EEOC's guidance issued in April last year, presumably to give a legal veneer to the subsequently filed lawsuits, "incorrectly applies the law" too.
[R]egulators are supposed to enforce the law, not write it. The AGs want the EEOC to rescind its criminal background check guidance and dismiss the Dollar General and BMW lawsuits, which is unlikely so long as Ms. Berrien is around. But at the very least, the letter should embarrass an agency that deserves serious congressional scrutiny.
Print media coverage of Social Security finances overwhelmingly favors reporting figures in raw numbers that lack relevant context, a trend that reflects cable and broadcast news coverage's push for reducing the cost of the program over strengthening benefits for recipients.
A Media Matters analysis finds that three major print sources -The Wall Street Journal, The New York Times, and The Washington Post - are more likely to report figures on Social Security revenue, spending, and funding gaps in terms of raw numbers that lack relevant context, such as previous years' figures. Fifty-nine percent of total mentions of Social Security's finances throughout the first half of 2013 relied strictly on raw numbers:
According to economist and co-director of the Center for Economic and Policy Research Dean Baker, the overreliance on reporting economic figures in raw numbers only serves to confuse and mislead readers:
It is understandable that people who want to promote confusion about the budget -- for example convincing people that all their tax dollars went to food stamps -- would support the current method of budget reporting. It is impossible to understand why people who want a well-informed public would not push for changing this archaic and absurd practice.
A Wall Street Journal editorial downplayed the vacancies on the D.C. Circuit Court of Appeals to justify Republican opposition to filling the posts, ignoring the Journal's past editorials highlighting vacancies during the George W. Bush administration as well as statements from judges on the D.C. Circuit regarding its unique workload and need for a full bench.
In the four years since the minimum wage was last raised, right-wing media have forwarded a number of myths to prevent any possible increase in the future, which often directly contradict economic evidence.
Major print publications relied heavily on the use of raw numbers when reporting economic issues, but these discussions of spending, deficit and revenue levels that rely solely on abstract and sensational numerical figures obscure otherwise important information.
A Media Matters analysis found since the beginning of 2013 three major publications -- The Wall Street Journal, The New York Times, and The Washington Post -- provided a majority of their coverage of the national budget (including figures on debt, deficits, spending, and revenue) without adequate context.
Reports highlighting gross spending, deficit, and revenue levels consistently failed to include relevant data such as the size of items relative to total federal spending or to GDP. Reports also consistently failed to put data into context with year-to-year comparisons.
For example, the newspapers' coverage of the national debt regularly failed to include the size of the debt relative to GDP, when doing so would have revealed that the United States does not carry extraordinary debt levels when compared to other developed nations. Discussions of the annual budget deficit regularly overlooked the fact that deficits have declined by more than half since peaking in FY 2009.
Many economists have noted that the media's reliance on enormous and abstract figures in economic reporting is little more than a scare tactic intended to drum up fears about the deficit. Dean Baker of the Center for Economic and Policy Research noted that the reliance on raw numbers also increases the likelihood that outlets will misreport information.
Opting to report national budget news in this way contributes to a general public misconception of debt, deficits, and the size and expense of spending programs. A Bloomberg News poll from February 2013 found that just 4 percent of Americans knew that the budget deficit was in decline. The same poll also revealed 34 percent of Americans believe the government spends between 2 and 20 percent of its budget on foreign aid, while another 31 percent believe foreign aid accounts for more than 20 percent of the budget. In fact, foreign aid and relief accounts for just 1 percent of the federal budget and has been in decline relative to overall spending for more than four decades.
This is not the first instance of media overreliance on inflated figures. Media Matters uncovered similar tactics employed by Fox News as it attempted to undermine Social Security and Medicare with the fear of "unfunded liabilities".
Throughout the first half of 2013, three major national print outlets mostly reported figures on debt, deficits, spending, and revenue in terms of raw numbers devoid of relevant context, such as previous years' numbers or monthly figures, that would give readers a more accurate depiction of the economy.
With a deal apparently sealed in the Senate that will end successful Republican filibusters on current presidential nominees to the executive branch, The Wall Street Journal revealed that its previous attacks on the proposed appointments were just an excuse to rail against long-standing progressive law.
The WSJ was an eager participant in right-wing media's attempt to bolster the GOP refusal to allow simple majority votes on President Obama's executive branch nominees. In particular, the editorial board was obsessed with smearing Thomas Perez, Labor Secretary nominee, and explicitly called upon Republicans to filibuster this cabinet pick.
In addition to calling him "tainted" because his performance as head of the Department of Justice's Civil Rights Division was purportedly "shady," a "flagrant abuse of his legal powers," "unacceptable in any government official," and part of a career of "bend[ing] the law to his ideological purposes," the WSJ also argued that the Republican opposition to him was "tepid" only because "[t]hey don't want to be seen opposing someone with a Spanish surname." On the eve of the bipartisan deal that finally curtailed the filibusters on seven nominees, the WSJ's last-ditch attempt to egg on continued GOP opposition to Perez was a reference to supposed "disdain" he has for the House Oversight Committee under Rep. Darrell Issa (R-CA).
Now that a vote and confirmation seems assured, however, the WSJ's latest discussion of Perez is notable for the lack of the baseless attacks on his qualifications and character that were frequent in previous editorials. Instead, the WSJ confirms that their opposition was always to effective and long-standing civil rights law that recognizes discrimination can be illegal not only in intent but also because of its impact.
Dropping its villainous characterization of Perez, the WSJ now makes clear that what it really hates is the fact that multiple banks have been punished for predatory lending and other racially discriminatory behavior under civil rights precedent, which even its own editors admit is recognized by all 11 appellate courts. From the July 16 editorial page:
The courts are the last line of defense against the Obama Administration's regulatory onslaught, and the latest legal challenge comes from the insurance industry. The home insurers sued late last month to overturn the Department of Housing and Urban Development's new rule using disparate-impact theory to prove housing discrimination.
Disparate impact lets regulators charge discrimination merely by showing that some racial or ethnic groups received fewer housing loans than other groups. There's no need to show intent to discriminate or even prove racial bias in a specific case. In practice, this means lenders and insurers must impose de facto racial quotas or risk costly lawsuits.
HUD rolled out the new rule in February to rubber-stamp Thomas Perez's campaign at the Justice Department to accuse banks of racism before the Supreme Court could rule on disparate impact's legality in a pending case.
Meanwhile, we reported last month that the Supreme Court agreed to hear a disparate-impact housing case, Township of Mount Holly v. Mount Holly Gardens Citizens. But we now hear the parties are in settlement talks, which no doubt thrills HUD and Mr. Perez.
Despite the right-wing media's most recent attempt to generate a "Watergate" style scandal imploding on live TV, The Wall Street Journal's Peggy Noonan continued to push the conspiracy theory that a recent break-in at a Texas law firm was orchestrated by the government in response to a whistleblower's allegations of misconduct among State Department employees.
Following June 29 and June 30 robberies at the Dallas office of Schulman & Mathias, lawyer Cary Schulman has suggested that State Department officials were responsible for the break-in. Schulman & Mathias represents a former investigator at the State Department's Office of the Inspector General named Aurelia Fedenisn, who provided documents to CBS News alleging misconduct among State Department employees.
In a July 9 Wall Street Journal blog post, Noonan baselessly speculated that the government was behind the break-in at Schulman's law firm, comparing the break-in to the Watergate scandal of the 1970s that resulted in the impeachment proceedings -- and ultimately resignation -- of President Richard Nixon. Noonan wrote:
Still, the Nixon-era whistleblower whose psychiatrist's office was broken into has some tough words, in an op-ed piece, for the current administration -- just as word comes that an Obama-era whistleblower's lawyer's office was broken into by . . . someone.
Just hours before Noonan's post was published, Schulman appeared on Fox News' America Live with guest host Martha MacCallum in a segment hyped as "'Watergate' Style Spy Claims." Schulman said that one reason to suspect State Department involvement in the burglary was because the perpetrators "have been unwilling to come forward with evidence of the crimes voluntarily and we don't know their whereabouts." When asked by MacCallum if he had any evidence to support these allegations, Schulman was forced to admit, "No I don't. All kidding aside, I was joking earlier. I don't know who did it."
The admission by Schulman that he has no evidence and was only "joking" about State Department involvement in the burglary did not stop Noonan from speculating that the government was somehow involved. Noonan concluded, "The burglary may or may not be a scandal -- but if it is, it's a big one."
Fox News and The Wall Street Journal stoked fears that a delay in the verification systems of health care reform would lead to fraud, while ignoring the fact that the government will conduct audits before implementing a stronger verification system and will heavily fine individuals who misrepresent their eligibility.
The Washington Post reported on July 5 that until 2015, the federal government will not require 16 states and the District of Columbia -- which are running their own health insurance marketplaces -- to verify whether an individual accurately reported that they currently do not receive affordable health insurance from their employer and are eligible for health care benefits under the new law. These benefits include tax subsidies for Americans who earn less than 400 percent of the poverty line and some additional Medicaid coverage.
On the July 8 edition of Fox & Friends, co-host Steve Doocy claimed the government "is not going to be able to verify whether or not you have the right income standards so they're going to trust people. What could possibly go wrong?" Fox News host Bret Baier, who was a guest on the program, further claimed the government was "not going to check to see if anybody qualifies to receive benefits" and suggested the move would lead to misspent funds, saying "you could see taxpayer dollars going out the window." Co-host Gretchen Carlson agreed the program would be "rife with fraud," while Doocy suggested this system would result in "a quarter of a trillion dollars" of fraud:
DOOCY: If you're just going to trust people to tell the truth, how is that going to work out when it comes to fraudsters if you look at the Earned Income Tax Credits. Right now, they say that about 25 percent of the people who get them don't deserve them. They should not be applying for them. But they get them. So if you use that same metric, you could probably lose, over 10 years, a quarter of a trillion dollars to fraud on this program.
The claim that this delay could result in fraudulent spending echoed a July 7 Wall Street Journal editorial, which claimed that "millions of individuals [could] decide they're eligible for the subsidies," resulting in "as much as $250 billion in improper payments in its first decade."
A Wall Street Journal news article stoked fears that immigration reform would lead to an increase in unemployment, while ignoring the Congressional Budget Office's assessment that in the long-term there will be no effect on the employment rate.
A July 2 Journal article relied on man-on-the-street interviews and opinion polling to hype the fears of some Democratic voters that immigration reform could "squeeze the wages and jobs of native-born workers." Though the article cited a former chief economist at the Department of Labor who explained that immigration makes it easier for companies to hire U.S. workers, the article ignored a CBO report which found that immigration reform will have no long-term effect on unemployment and wages.
In fact, according to the CBO report, while enacting the immigration reform bill would cause a temporary increase of 0.1 percent in unemployment over the next five years because of the expanding workforce, there would be little effect in the long-term and "no effect on the unemployment rate after 2020." From the report:
In the long run, the actual unemployment rate in the economy tends to be close to its natural rate. The natural rate of unemployment of the additional immigrants would be comparable, on average, to that of the current population, CBO expects, so there would be little effect on the unemployment rate in the long run. Thus, in the long run, the number of employed people would increase by the same percentage as the growth in the labor force--by about 3½ percent in 2023 and by about 5 percent in 2033, CBO estimates.
Furthermore, the CBO found that average wages would increase by 2033, and that over the long term immigration reform would boost capital investment and raise productivity of labor and capital.
The Journal itself has previously acknowledged the economic benefits of immigration reform. Indeed a June 20 Journal editorial noted that the CBO report found the proposed legislation was "pro-growth" and would result in rising standards of living, higher wages, and increased productivity:
CBO also sensibly notes that newcomers to the U.S. tend to belong to either the least- or most-skilled groups of workers, so any harm for most average Americans is nonexistent. In fact they will benefit from rising standards of living and higher wages that faster growth makes possible.
New workers with lower skills or less education like farm hands or bar backs fill gaps in the U.S. labor market and will see their earnings rise over time. Let's also not forget that the Senate bill greatly increases H-1B visa quotas and green cards for tech and science grads, so the U.S. will see an influx of the engineers, Ph.D.s and entrepreneurs who generate the innovations that increase economic output faster. The CBO cites the large body of empirical literature on such "positive spillover effects" as a major reason productivity will rise.