Robert Litan for the Brookings Institution: Although I am not optimistic that our social, economic, and political divisions will heal any time soon, I do have hope the farther out I look, for three reasons:
First, millennials, who are the most educated generation in American history and have generally been raised to be tolerant of differences in race, ethnicity, and sexual orientation, will eventually run our country. Already, some young people in elected positions have proved to be highly pragmatic yet idealistic, and thus a source of hope that eventually our electorate and our leaders will be less divided than now.
Admittedly, millennials are far from perfect. Survey evidence from the Pew Research Center suggests that many millennials are self-absorbed. Even millennials agree with this assessment. But comedian Trevor Noah has it right when he observes that although millennials may feel too “entitled,” they also are driven. They wish to make a change.
Second, one silver lining of the sexual harassment and abuse cases out [of] Hollywood, Washington, and corporate America is that they are driving record numbers of women to run for elected positions. Without stereotyping, there is evidence that female politicians are more likely than male politicians to compromise and work together, an essential feature of effective governing.
Third, as populism drives both political parties to extremes, there is a potentially vast middle of the electorate — fiscally conservative, socially liberal, desperate for leaders willing to compromise and a return to normalcy and civility in our political conversations — who are already independent or who could defect from their current party to make up a politically viable, new third party. The crazier things get, and the more dysfunctional the federal government becomes, the likelier the formation of such a third party, capable of changing our government for the good, becomes.
U.S. immigration is changing
Pia Orrenius for the George W. Bush Institute: The current immigrant stream is not only much more likely to enter legally than in the past, but is also far more educated. Of the 2.7 million foreign-born workers ages 25 or older added since the recession, more than 2 million had at least a college degree. Meanwhile, the number of adult foreign-born workers with less than a high school education shrank by more than 300,000 over the period.
The highly skilled immigrants are mostly from Asia. Since 2010, new arrivals from India and China have surpassed those from Mexico in every year.
Many of these highly educated immigrants enter through the H-1B visa program and work in STEM fields and have graduate degrees. About 46 percent of college-educated immigrants hold STEM degrees compared with just 28 percent of college-educated U.S. natives.
Research has linked increases in the STEM workforce to higher productivity growth; in fact, one study estimates over half of total factor productivity growth in the U.S. has been due to the greater numbers of scientists and engineers, a proxy for research and development intensity. Immigrants made up the majority of the increase in the STEM workforce in the last two decades, so it stands to reason that highly skilled immigrants have accounted for a significant share of U.S. productivity growth in recent times.
This conclusion is bolstered by evidence of immigrants’ direct contributions to patents and other innovative activity, including entrepreneurship. High-skilled immigrants fill positions in key industries; the economic benefits of their labor are now well-documented.
Cutting taxes — and attacking public schools at the same time
Ronald Mak for the Institute on Taxation and Economic Policy: When Republican leaders rushed through an overhaul to the federal tax code over a seven-week legislative period, they failed to acknowledge that many provisions in their bill would have negative consequences for states. One such provision of the Tax Cuts and Jobs Act that undermines state laws is the expansion of federal tax breaks that now allows taxpayers to use 529 savings plans to pay for private K-12 education. …
While the new provision accounts for a sliver of the law’s $1.5 trillion cost to the federal government, states are left grappling with how to respond. …
Since their inception, 529 education savings plans were created to encourage long-term savings for higher education in the face of rising tuition costs. With the expansion of 529 tax benefits to private K-12 education, families with children in private school most likely will use these accounts as tax shelters to pay for tuition rather than as a way to save for college education.
Without state lawmaker action, families in many states can now contribute to a 529 account, receive a state income tax deduction or credit in exchange for their contribution, and then immediately withdraw those funds to pay for K-12 private school tuition with no penalty. In this scenario, the 529 plan is not a savings vehicle at all. Rather, it’s a brief pit stop whose only purpose is to allow taxpayers to pay for their children’s private school using pre-tax dollars.
The 529 change isn’t just another tax subsidy for families of means. It also should be seen as part of a conservative strategy to undermine public education, diverting revenue from public to private schools.
