Immigration and population change

As reported today by the Times, Jeff Passel and D'Vera Cohn wrote a report for the Pew Research Center that revealed a large role for immigration in U.S. population growth to 2050.

The direct effect of immigration on population growth is not particularly large; the flow of new immigrants into the U.S. every year accounts for perhaps one-third of the 1% annual rate of population growth. But new immigrants typically arrive young, with families, and their families tend to be larger than those of the native-born (i.e., immigrants' fertility rates are higher). So Passel and Cohn project immigration will account for 82 percent of the net increase in living U.S. residents, or about 117 million of the 143 million new people we will have by 2050.

This certainly adds perspective. The report also discusses trends in the "dependency" or support ratio --- the number of non-workers per worker. Immigration typically reduces it, meaning that immigrants help pay for Social Security and for kids' education. But the effects of immigration do not appear to be large relative to those of the retirement of the Baby Boom.

Great advice for grad students

I knew Darren Lubotsky when he was a graduate student at UC Berkeley. He has written a very useful, if a little dense, 4-page work on how to be a good graduate student. All of us "wish we'd thought of that" when we were graduate students!

A tough time for the Fed

Yesterday the Federal Reserve cut the federal funds rate by another 0.50%, after a between-meetings cut about week before. The Fed was reacting to a credit crunch and the slackening of economic growth stemming from troubles in the housing market.

But at the same time, overall consumer price inflation was up 4.1 percent in December over a year earlier. While the "core" rate (less food and energy) was up only 2.4 percent, inflation is still clearly a concern. Per the Humphrey/Hawkins legislation, the Fed has twin goals of full employment in addition to price stability, but the latter concern seems to have taken a back seat recently.

This is arguably for good reason. The Fed is probably gambling that inflation will remain tame either because (1) much of the recent surge is due to energy prices, which are unlikely to be affected much by U.S. domestic developments, or (2) the deceleration in aggregate demand we have recently seen should dampen prices anyway.

Keep your fingers crossed! But it probably isn't time to jump to inflation-indexed bonds if you don't own them already.

Military service and health

As discussed by the New York Times, the New England Journal of Medicine published a research article on mild brain trauma among Iraq War veterans and psychiatric symptoms like PTSD.

A colleague of mine, Alair MacLean, studies combat exposure and life outcomes among veterans. The costs of military service are considerable, and I think it is an open question whether the government compensates veterans enough for having borne them.

An inversion of a notorious inequality

In 2006, the Times reported a key finding of Andy Beveridge's group at Queens College, City University of New York, about the black/white income differential in Queens County.

Beveridge found, in the Census Bureau's 2005 American Community Survey, that median household income for African Americans in Queens County was $51,836, nearly even but still surpassing that for whites, $50,960. The median Asian household received $52,998.

The article discusses a number of reasons why this might be true. An unanswered question I'm interested in: does this inversion of the race differential show up in health statistics as well?

Tax rebate details

The Washington Post presented a clear overview of the tax rebate (a.k.a. fiscal stimulus) package agreed upon by House leaders and the White House.

Unlike the 2001 cut, the rebate checks will phase out to zero beginning for individuals above $75,000 and couples above $150,000 in adjusted gross income.

It only sounds insane

Len Burman of the Urban Institute dropped a bomb on the Times op-ed page today. He suggests rolling back the Bush income tax rate cuts a year early, in 2009, rather than in 2010, when they are currently set to expire.

He sounds nuts, but Burman makes a subtle point: if taxpayers expect a higher tax rate in 2009, they will shift some taxable activity, in this case working, into 2008 instead. And that should help stimulate the economy.

Despite what Burman and others have said regarding the 2001 fiscal reform, I doubt this would have as stimulative an effect as a broad-based tax cut that placed rebate checks in the hands of a lot of folks. But it is an interesting, although a completely counterintuitive and probably DOA, proposal.