Economists are interested in immigration for two reasons: their impact on the labor market and what progress these immigrants are contributing to the United States economy (Edmonston, 1996). There is much discussion about these immigrants in this area of study. These two areas of concern are important because research shows that the labor markets have changes considerably due to the changing contexts of recent immigrants. Not only are the labor markets being changed, but they way homes are shaped and culture bounds are formed (Johnson & Menounos, 2008). This research leads us to believe that further conceptual work is needed for us to determine the role of employers in the labor market and how they employ people, particularly immigrants. This not only involves those who are in the labor market, but also the children of those workers. These children may feel that because their parents are of the lower-class labor market, that they may not excel to anything beyond that.
Studies show that the greatest wave of immigration in the United States occurred during the year 1994 (Abernathy, Barff, Burtless, et. al., 1994). Studies claim that immigration has negatively affected the American Labor Movement (Briggs, 2007). This is because immigration directly affects the size, the composition and the skills in the labor market. These involve people from ethnic groups in connection to the labor market (Edmonston, 1996). Because of these negative views on immigration in regards to the economy taking a toll, the children of these immigrants suffer socially.
It has been argued that the children of these immigrants cross cultural boundaries, crossing linguistics from the home and in school. However, these children also have to undergo hurdles such as racism, an economic disadvantage and language assimilation. Most of the time, these children of immigrants come from environments which are not very well-off in socio-economic aspects. This creates a sense of insecurity in the children, at the same time they are battling with issues of belonging (Johnson & Menounos, 2008).
Children are found to be embarrassed by their parents because of linguistic reasons. The immigrant parents are usually seen have very little skills in speaking English, and concerns about belonging as well as being judged rise in children. This negatively affects their self-esteem, and results in the children distancing themselves from the family and from the home (Johnson & Menounos, 2008). The children of these immigrants have a confused sense of belonging. They know that they are not originally from the country in which they are residing, yet all they know is the world around them; most have never been to their homelands. This causes confusion in identity, not knowing where they should really belong (Johnson & Menounos, 2008).
Recent studies have found that children who are from second immigrant families do not have equal opportunities when it comes to education. This is because these children are usually from families who are of the lower-class status, and are seen working before and after school to help with the household income. These children do not get to avail of programs such as advanced placement and international baccalaureate programs (“College Board”, 2010). This negatively affects their chances in college success later on in the future. Sadly, this also determines what these children think of themselves. They believe that they have more of a responsibility to help the family, also they do not think that they will ever get to pursue whatever it is that they want.
The negative issues concerning immigration and the economy are relevant in the community, as well as the home. Further studies should be conducted to see the negative affects this has on the children of immigrants. It is not only affecting homes in an economic way, it impacts the family also socially and psychologically.
The book entitled “Conversations Across our America: Talking about Immigration and the Latinization of the United States” was written by Louis Gerard Mendoza – Chicano author. He wanted to know more about the Latino culture in America as he was very surprised how little some people knew about the community, even if they have been present for quite some time. The rising rates of immigration have created a bond within America. This cultural bond brings together Latino families from different towns. It is seen in the workplace, in church and around the community. It was still a wonder to Mendoza that no matter how many Latinos there were in America, and how long they have actually been there, people still knew very little about them and their history, culture or way of life. He took his bicycle and went around America, collecting narratives from families, Latino and non-Latino. He enlightened them with stories and gathered first-hand narratives about their lives, how they came to America and why they decided to migrate. Those who knew little about the culture, he shared stories with in hopes that they would be able to learn and appreciate the growing Latino community in America. He also came to understand himself how hard it was to be considered a social or economical problem in a country that cares little about your existence. His book was a nice compilation of stories by real people that he interviewed during his journey. He made friends along the way and was able to write an entire book on the influential lives of ordinary people who came to America to find a better life.
The interesting portion of Mendoza’s book was when he came to a realization himself. He learned how to appreciate his culture and where he came from with the stories that he had gathered. Latinos and the rising rates of immigration has been a concern for politicians. Many people think that there are way too many foreigners in America, taking jobs that could have been for citizens. This is a kind of cultural battle that many Chicanos had to face. It sometimes came as a wonder why they would pack up and leave their motherland to go el norte (Mendoza 3). However, the stories and narratives that Mendoza gathered helped him understand and even appreciate why people left. They were struggling socially and economically – they believed that heading over to America was the only way they could secure a better future for their children. The touching stories told by real people showed how the Latino community was solidified. Despite the negativity shown in media about how the increased rates of immigration has taken its toll on the economy, Latinos still form their ties and keep their bonds. This compilation shows how Chicanos have a sense of community. Even though they are not in their homeland, or motherland, they still have a love for their culture. New migrants experience the most hardships, though they get through it with the help of other Chicanos.
The economy’s growth rate tends to vary over times; it goes from periods of strong growth to economic slowdown and vice-versa. When economic growth decreases for two consecutive quarters, this is when the economy is experiencing recession. The term “business cycle” is referred to as the fluctuations in GDP. A business cycle generally has four phases. These are:
1.) Expansion
2.) Peak
3.) Recession; and
4.) Trough (Osborn & Sensier, 2002)
Each of these phases can go through an undetermined time frame, it could be weeks, months or even years. When you look at historical data of economies, it comes off to be of a cyclic manner, that’s why it’s referred to as the “business cycle”.
There are numerous observable characteristics or indicators of the economy which we can measure through different government departments. Examples of these are: the Bureau of Economic Analysis (BEA), the Federal Reserve Bank (FRB) and the Bureau of Labor and Statistics. Economic indicators can vary directly or indirectly in relation the business cycle. These can be seen through the observation at a local level. To put this in perspective, here’s an example: when the rate of an economy’s growth moves rapidly forward, businesses tend to produce more, this requires resources such as human capital, thus employment rises. When employment rates start to pick up, consumers start to earn money and spend more, and this then fuels economic growth. Consumer expenditure is then a key determinant of economic growth, it can be seen as large component of GDP. Employment as well as expenditure has a direct relation with the business cycle. In the same local level, when businesses earn higher sales, their revenue would be increasing.
Unemployment, however, is indirectly variable to the business cycle; when there is economic growth, the rate of unemployment falls (Osborn & Sensier, 2002). During a recession, businesses will tend to lay-off their workers in order to save money, and also because they do not require much human capital for their production. The fact that the government is allowing new employees to enter the labor force – people who are consider legal and undocumented immigrants – means that there are absolutely too many people in the job market. Another variable in terms of economics which can relate to the business cycle is observed at a national, state and a local level. This is the inflation rate. Inflation is the term referred to the increase in general price level. This is measured by both the consumer and the producer prices (Flood & Lowe, 1995). This can be explained when we focus on the labor market. When economic growth accelerates, more people are employed, and this along rises with the possibility of labor shortages in some industries; this varies from states and regions.
Everyone is affected by the business cycle at a local level. This is because local economies are made up of households, workers, businesses, etc. To be able to understand this, we must pay close attention to our nation’s Gross Domestic Product (Flood & Lowe, 1995).
The decisions - when it comes to fiscal policy - has a great effect on people’s everyday decisions and behaviors in terms of households as well as businesses. Changes to indirect taxes can have a big effect on the patterns of demand when it comes to the production of goods and services (Abrams, Clarke & Settle, 1999). The use of indirect taxation can sometimes be justified due to instances like market failure. It is sometimes argued that taxes can also have a significant effect on the intensity of overall efficiency and productivity when it comes to labor. This can also be seen in terms of businesses and their investment decisions. When there are lower rates of corporation tax, other business taxes can cause an increase in that certain businesses fixed capital which is used for investments (Abrams, Clarke & Settle, 1999).
Obama’s Old Deal Review (a direct example)
The article entitled “Obama’s Old Deal”, was written by Michael Hirsch. The issue in which the article address was related to the United States was going through a financial rut under the presidency of Barak Obama. It states that banks were not lending money and the economy was still undergoing high rates of unemployment even after Obama’s first year in the Whitehouse. It compared predictions made earlier to what is actually happening in Wall Street, and it all points to Obama and his decision-making. The article claims that Obama is being perceived as the one who is in the wrong.
According to Hirsch, the White House did not adopt to Paul Volker’s point of view on banking, in terms of risk taking and “proprietary” trading. Volker points out that America’s banks are enjoying federal guarantees on their deposits, whilst American taxpayers are putting their money at risk. Obama as well as his economic team has said to have largely ignored Volker. In one of Obama’s statements, he even said that he was not convinced that Volker could be correct in his views. However, Obama did come into accepting what Volker had to say, and this one incident with the President has lead Hirsch into saying that Obama has not been acting like Franklin Delano Roosevelt (whom he has been compared with in the past, in regards to the Great-Depression).
According to Hirsch (2009) Obama and his economic team did not make enough efforts to change the structure of Wall Street, which was contrary to Volcker’s plan. It states that Obama was definitely not like FDR because his decisions were not directly driven by the White House. Much to Volcker’s dismay, the fundamental structure of Wall Street had hardly changed, and the new law in which Obama said would improve the economy had made the banking elite more powerful. It is believed that this was too much in favor of big banks, and in turn community banks are at a disadvantage. Obama’s administration was also criticized for doing very little to reorient pay packages in big financial houses.
Hirsch states that all of the challenges mentioned required fundamental rethinking of the U.S as well as the global economy. Wall Street is said to be able to remain intact with greater capital reserves, more regulatory oversight and also greater leverage limits.
Obama is said to not have lived up to his comparison to FDR, and unemployment numbers could stay the same all the way until the year 2012. Obama is said to be distracting himself with issues of healthcare. In the end, Hirsch states in the form of a rhetoric question that Wall Street has come out as the bigger winner, and American taxpayers are still at a loss.
References
Abernathy, V., Barff, R.A., Burtless, G., et. al. (1994). Immigration and the Labor Market: Discussion Sponsored by Center for Immigration Studies and Center for Public Policy & Contemporary Issues. Center for Immigration Studies. Web. Retrieved from http://www.cis.org/Immigration%2526LaborMarket
Abrams, B.A., Clarke, M.Z., & Settle R.F. (1999).The Impact of Banking and Fiscal Policies on State-Level Economic Growth. Southern Economic Journal, 66(2).
Briggs, V.M., Jr, (2007). How many illegal aliens are in the U.S.? Social Contract Journal Issues, 17(4).
Edmonston, B. ed. (1996). Statistics on U.S. Immigration: An Assessment of Data Needs for Future Research. Washington, D.C.: National Academy of Sciences.
Flood, D.F., & Lowe, P. (1995). Inventories and the Business Cycle. Economic Record 71(212).
Hirsch, M. (2009). Obama’s Old Deal. Newsweek. Print.
Johnson, A. & Menounos, M. (2008). America being reshaped by second generation children of new immigrants. Political Articles. Retrieved from http://www.politicalarticles.net/blog/
2008/10/20/america-being-reshaped-by-second-generation-children-of-new-immigrants/
Osborn, D.R. &, Sensier M. (2003). The Prediction of Business Cycle Phases: Financial Variables and International Linkages. National Institute Economic Review.
