The Democrats Take Control

People are writing at long length about the recent take over of both houses of congress (even if by a slim margin in the Senate) by the Democrats and what this means for the economy. Consensus has pretty much decided that due to a Republican White House, we are looking at two years of gridlock. There goes reforming social security.


Well at least some policy could be decided that may have a long term positive effect on the economy. Hopefully, the first of these policies may be the Temporary/guest worker program and an immigration policy that works. Bullheaded okie congressman were playing protectionist politics trying to keep the Latino immigrants out. There maybe a homeland security argument to be made here, but I think that that risk can be mitigated. People aren't dying crossing the Rio Grande to commit terrorist acts, they just want a job and a better life for their family. This illegal immigration will continue. However, by monitoring and tracking these people, i.e. making them legal, we may have a better chance to spot the terrorist that may try to come through. Basically, immigration is almost always a net gain for the country. Our workforce gets beefed up with new workers, keeping labor costs down, performing services that most Americans don't want to do at the current market price, and these people have children that contribute further to our economy.

On the other side of the scale, the H1-B visa system needs to be changed to a point system that mimics the Australians and Canadians. America always needs more engineers and scientists. We need to be bringing them in any way we can, considering that there is a worldwide competition for talent. The more we beef up our talent ranks, universities, and companies with the best quality people, the better we will compete with the rest of the world.

Another thing "The Economist" also mentions as a potential benefit from the democrats taking congress is more work on the environment, improving building codes, green materials, energy efficiency and alternative energy subsidies, and more funding and subsidizing of research and development for the automakers. Maybe in conjuction with raising the CAFE standards which need to be adjusted. The market may need some nudging along to get the auto companies to act, but the high oil price had already pushed them into more cars and less trucks. I see the possibility for nuclear technology flourishing and becoming the preferred electricity source. This may hurt the oil companies as their subsidies will surely be cut, but who should be subsidizing $50 oil anyway? There is definately enough incentive to explore.

In summation, the economy could benefit from some policy changes made by the Democrats and President Bush working together, and hopefully some things will get done, because this President could still do some things that may not absolve him of the Iraq mess in some people's eyes, but will at least dampen their hatred.