Bernie Sanders has come out against open borders, claiming they are a “right-wing proposal” that “would make everyone in America poorer.” He argues that, while we have a “moral responsibility” to “work with the rest of the industrialized world to address the problems of international poverty… you don’t do that by making people in this country even poorer.”
But there is a vast amount of literature showing that open borders could be the single best policy to alleviate global poverty. The free movement of people would enrich individuals by allowing them to move to where their specific skills and talents are most economically efficient and personally beneficial. According to Michael Clemens at the Center for Global Development, open borders could lead to a one-time boost in world GDP of 50 to 150%.
Contra Senator Sanders, a Democratic candidate for president, open borders is a moral imperative for those who truly wish to help the world’s poor. If Sanders wishes to challenge mainstream economists on this fact, he must provide empirical evidence to back up his assertions. Otherwise, he deserves to be dismissed as just another politician, playing to domestic, nativist sentiments, rather than pursuing the economic policies that will benefit Americans and reduce global poverty.
Read the rest on the Guardian US here.
Democratic presidential candidate Senator Bernie Sanders (I-VT) frequently pines for the United States to be more like the Scandinavian countries of Norway, Sweden, Finland, and Denmark. He cites the northern European nations’ lower levels of income inequality, when compared to the United States, as justification. But there is one problem: although income in these European countries may be more equal, workers get smaller paychecks.
On paper, workers in Scandinavia appear richer than their counterparts in America. But to compare accurately life in the two regions, we need to make a couple of adjustments. The first is taxes: according to OECD data analyzed by the Tax Foundation, the “tax wedge”—the difference between what it costs to employ a worker and what he sees in his paycheck—is much higher in Scandinavian countries than in the United States. After taking out taxes, we also need to adjust take-home pay by the country’s price level, since goods and services cost more in some countries than others.
Read the rest on Economics 21 here.
The island of Puerto Rico has been floating in a sea of debt for quite a while, but now it appears to be sinking. Facing $73 billion in debt, the U.S. territory’s governor, Democrat Alejandro Garcia Padilla, is warning that the island can’t continue making payments on its public debt, and reports suggest Puerto Rico may run out of cash in July. To say the island is in rough shape would be an understatement.
The island’s debt obligation is about four times the size Detroit’s was back in 2013, when the city filed for federal bankruptcy protection—the country’s largest municipal bankruptcy case ever. Puerto Rico’s debt is actually greater than the debt of all U.S. cities to have ever filed for bankruptcy protection combined. Puerto Rico’s debt amounts to over $20,000 per resident and it has amassed more municipal bond debt per capita than any other U.S. state.
Unlike Detroit, the Island of Enchantment can’t declare bankruptcy to absolve its debts. Federal bankruptcy code prevents the island (and states) from filing bankruptcy. Puerto Rico’s two options are that it can continue to work out deals with creditors to refinance its outstanding debts, or it could push Congress for a bailout — which seems unlikely to happen.
Read the rest on The Daily Caller here.