More on Alan Greenspan

Date: Thursday, February 21, 2008 1:18 PM

<<<<< JOB DESTRUCTION NEWSLETTER No. 1823 -- 2/21/2008 >>>>>

As explained in a recent newsletter, Alan Greenspan thinks that increasing the
number of H-1B visas will help avoid recession because it increases labor
arbitrage, which results in wages being cut. Greenspan uses the euphemism
"income equality" to mean wage busting. Traditionally recession means that a
nation has negative economic growth, but for Greenspan and his fellow
plutocrats, recession is when corporations have to pay more for labor.

http://www.dallasnews.com/sharedcontent/dws/dn/latestnews/stories/021508dnbusgreenspan.c1d69e5d.html

"Significantly opening up immigration to skilled workers solves
two problems," he said. The companies could hire the educated
workers they need. And those workers would compete with
high-income people, driving more income equality, he said.

Recession isn't the only economic problem that Greenspan feels can be improved
by opening the immigration flood gates. In the year 2000 he said it can be
used to fight inflation. Basically Greenspan seems to think that immigration
is a Swiss Army knife for the economy -- whether there is a recession or
inflation increased immigration is the solution to all our woes.

http://www.federalreserve.gov/boarddocs/speeches/2000/20000306.htm

"Imbalances in the labor markets perhaps may have even more serious
implications for potential inflation pressures. While the pool of
officially unemployed and those otherwise willing to work may
continue to shrink, as it has persistently over the past seven
years, there is an effective limit to new hiring, unless immigration
is uncapped.

Alan Greenspan thinks H-1B and other immigration programs are good for
business because they increase the labor supply which in turn causes wages to
decline. It's the supply vs. demand theory. However offensive his statements
are, they are at least brutally honest, which is more than I can say for the
liars that argue that H-1Bs increase the salaries of Americans and create
jobs. It's kind of ironic that the politicians and pundits who worship
Greenspan as the high priestess of economics are the same ones who claim that
H-1B either doesn't affect wages or somehow actually increases wages for
Americans even as the labor pool gets larger.

A reader of this newsletter, who wishes to remain anonymous, sent the
following commentary to me. I thought it was so well written I should share it
with all of you. The video referred to (at time 1:23:00) is so disgustingly
elitist you better have a barf bag ready. The best way to fast forward to that
time is to click to the option to view the video in a stand-alone RealVideo
player.

<<<<< Guest Commentary >>>>>

A few months ago Greenspan was flogging his book at a forum at George
Washington University hosted by the economist Daniel Yergin. It was called
"The Age of Turbulence: Adventures in a New World" broadcast on
CSPAN2 "Book TV." You can watch the program and download a podcast here.

http://www.booktv.org/program.aspx?ProgramId=8661&SectionName=&PlayMedia=No

At 1 hour and 23 minutes, he announced that the US should "augment" (his
word) immigration to "suppress" (his word) the wages of skilled American
workers. He made a general policy statement without reference to the H1-B
program. He said this in the context of the need to address income inequality
in the US. His solution is to lower the wages of the skilled middle class. He
also brought up the canard of the US failure to educate enough people in math
and science. There was absolutely no reaction from Daniel Yergin, nor any kind
of gasp or murmur from the studio audience.
Here was a major government policy maker advocating a specific policy to act
against the interests of skilled American workers, the heart of the middle
class. Few people seem to realize what Greenspan is really saying.
When I tell this to people, I get a blank stare as though what Greenspan said
is without implication for their welfare.

Greenspan's positions are inherently contradictory. Why would students want to
study difficult technical subjects if the skilled wages, which are currently
flat, were to actually decrease? What would be the national security
implications if much of our engineering were turned over to foreigners. As it
is the Chinese are on a major campaign to acquire industrial and military
technology from the US planting their engineers here.

What we are seeing is the replacement of the nation state by the market state.
It seems that Greenspan, Yergin and leaders from academia and government have
no loyalty to the American nation state, and would just as soon see it whither
away in favor of a piece of real estate where economic transactions occur in
an efficient manner.

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