The Economist - USA (2019-07-20)

10 Leaders The EconomistJuly 20th 2019

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I

t isafamiliarpattern.Thepresidentsayssomethingoutra-

geous—thistimeDonaldTrumptoldfourblackandbrown-

skinnedDemocraticcongresswomen,allofwhomareusciti-

zensandthreeofwhomwereborninAmerica,to“goback”

wheretheycamefrom.Hissupporters,whohavecometoaccept

whatmanyofthempreviouslyfoundunconscionable,staysi-

lent.His opponents,rightlyappalled,lamentwhathas hap-

penedtotheircountry.AtthesametimetheTrumpadministra-

tionmakesa bigpolicychangethatattractsfarlessattention—in

thiscase,anedictthatdirectlyaffectstensofthousandsofpeo-

plea yearandoverturnshalfa centuryofprecedent.

Last year120,000peopleclaimedasylum,themajorityof

thematthesouth-westernborder.OnJuly15ththeWhiteHouse

announcedthatclaimswillnolongerbeconsid-

ered unless applicants can prove that they

sought asylum in one of the countries they

passedthroughontheirwaytoAmerica,and

wererejected.Therewillbelegalchallengesto

thenewrule,becauseAmericaispartytothe 1951

Refugee Convention andbecause the change

maycontraveneAmerica’sownRefugeeActof

1980.Butinthemeantimeanyonewhopasses

throughGuatemalaorMexicoonthewaytothesouthernborder

withoutfirstseekingrefugetheremaybeturnedaway.

Thereisnokindwaytoenforceimmigrationlaw,whichbyits

veryexistencemustsquashthedreamsofsomewhowishtomi-

grate(seeAmericassection).Plentyofasylum-seekersatAmeri-

ca’ssouthernborderarenotfleeingpersecutionbutcrimeand

poverty(seeAmericas).However,thisisthewrongwaytogo

aboutthings,forreasonsofprincipleandalsoofpragmatism.

First,principle.Theideathata refugeeshouldbeprotected,

regardlessofwhichcountrieshemighthavetraipsedthrough

beforehand,isworthdefending.ItisalreadydyinginAustralia

andEurope.TheEuropeanUnionoutsourcesmuchofitsasylum

policytoTurkeyandLibya,forexample,ortomemberstateson

itsfringes;thousandsofpeoplelanguishincrowdedcampsin

Greece.ButforAmericatoabandonthisnormsendsaneven

moredisturbingsignal.Thelandofthefreehasa proudhistory

ofresettlingrefugeesfromfar-offplaces,rehousingmanymore

thananyothercountry.

Second,pragmatism.MrTrumphasalreadyusedthreatson

tradetopersuadeMexicotohostmoreasylumapplicantsonits

sideoftheborderwhiletheyawaitnewsoftheirclaims.Unable

tobuildhisoft-promisedwall,hisadministrationhastriedto

determigrantsbyothermeans,includingseparatingchildren

fromtheirparentsattheborder.Migrationnumbersarevolatile,

andtendtodeclineinthehotsummermonths,butsofarnoneof

thesethingshascutthenumbersenoughforMrTrump.Clamp-

ingdownevenharderwillnotaltertheincen-

tivestoleaveElSalvador,HondurasandGuate-

mala,wheremostasylum-seekerscomefrom,

insearchofa betterlife.It simplymakesit more

likelythatmigrantswillrelyontraffickersrath-

erthanthelegalsystemtocrossintoAmerica.

Thereisa betterway.Thefirststepwouldbe

toincreasethenumberofjudges,toclearthe

backlogofimmigrationcases.There arecur-

rentlynotfaroffa millioncasespending;thewaitingtimeto

hearthemcanbeaslongasthreeyears.Manyasylum-seekers

disappearintothegreylabourmarketastheywaitfortheircases

tobeadjudicated,joiningtheranksofAmerica’s10.5munlawful

migrants;theDepartmentofJusticesaysalmosthalfdonotshow

upforcourthearings.Thenextstepwouldbetoallowtheimmi-

grationandcitizenshipservicetodecideasylumapplicationsat

theborder.Finally,thefederalgovernmentcouldprovidemore

aidtoimproveconditionsinCentralAmerica.WhenMexico’s

economyimprovedandthefertilityratefell,thenumberofMex-

icansmigratingnorthslowedtoa trickle.Adifferentpresident,

witha moreexpansiveviewofAmericangreatness,woulden-

forcerulesandchangeincentives,notabrogaterights. 7

While you were tweeting

Asylum-seekers

UnitedStates,defensive

applications,’

2008 10 12 14 15 18

0

60

30

90

120

Amid the outrage over the president’s race-baiting, his administration rewrote asylum law

Immigration and America

O

ver thepast 25 years America’s stockmarket has soared. Far

from being built on thin air, this long bull run has rested on a

boom in corporate profits. The worldwide earnings of all Ameri-

can firms, whether listed or not, have risen by 455% over this per-

iod and are now 35% above their long-term average relative to

gdp. America Inc mints $1bn every five hours.

Globalisation, tepid wage rises, the ascent of tech and feeble

competition made the bonanza possible. But as some of these

forces ebb, the era of relentlessly expanding profits is under

threat. Over the next few weeks America’s blue-chip companies

will report their latest profit figures, which are expected to drop

slightly (see Business section). Managers and investors need to

be alert, especially given the growing number of firms with high

debts that rely on bulging profits to stay afloat.

Profits are an essential part of capitalism—they reward sav-

ers, incentivise innovators and create surplus funds for invest-

ment. America is the home of the bottom line: firms based there

account for 33 cents of every dollar made by listed companies

worldwide. The level of profitability shifts over time: in the

boom after 1945 American firms made hay, whereas they strug-

gled in the mid-1980s. Even so the upswing since the 1990s has

been striking. The worldwide post-tax earnings of American

Soaring stockmarket, peaking profits

After years of plenty America Inc is struggling to crank out higher earnings

Business in America