It should be noted that the number does not include around 1.6 million temporary workers and their dependents, nor does it include the 8 million illegal immigrants the CBO says would gain legal status if the bill passed. Those people “would not affect the size of the U.S. population”.

The CBO also claims the bill would increase direct federal spending by $262 billion from 2014–2023, but that revenues would increase by $459 billion over the same period.  Supposedly the bill would  lower deficits by $700 billion in 2023-33.

The increase in the number of legal residents stemming from the bill would boost direct spending for federal benefit programs; direct spending for enforcement and other purposes also would rise. Under the bill, federal revenues would be higher as well, mostly because of the larger size of the labor force.

Also, the aggregate annual costs of the implementing mandates on private entities — they would kick in around 2016 —   will cost businesses $700 million.

A Heritage  Foundation’s study found that immigration reform would cost taxpayers nearly $900 billion per year.

Though I’m on the reformist side of this debate, I’m going to stick with my rock-ribbed belief that any economic study offering projections exceeding one or two years is merely guesswork.  And because of its constraints — having to base its calculations on current law — you should be particularly skeptical of the CBO’s guesswork. How can we possible calculate with any certainty the number of future Americans who will become eligible for means-tested federal welfare programs, or the future cost of Obamacare — already rising by the day — or even the state of the economy in five years? You can’t.

—————————
Follow David Harsanyi on Twitter @davidharsanyi. 

The post The CBO says immigration reform will cut deficit appeared first on Human Events.

Sessions described the current incarnation of comprehensive immigration reform as a “disastrous event,” saying that “people do want something done, but the polls show that four-to-one, the enforcement needs to come first, and amnesty second.  We’ve got it just backwards in this bill, and that’s one of the fundamental problems.”

The Senate gang’s refusal to put border security first was one of several criticisms Sessions offered.  He also opposes the “dramatic” increase in legal immigration contained in the bill, which he feels is unwise in a time of long-term high unemployment.  He noted the bill has swelled to over a thousand pages, and is “very difficult to read,” with hundreds of loopholes and special waivers… much like another bill of great concern to the Tea Party, namely ObamaCare.  Passing a bill to find out what was in it didn’t work out very well in that case, and it probably won’t work any better this time.

“I think this bill diminishes middle-class America,” said Sessions.  ”It’s going to make it harder for them, and their children and grandchildren, to get jobs at good wages.  And also, it’s eroding the rule of law, making it more difficult for us in the future claim that our immigration laws should be enforced.”

He confessed to some worry about what the immigration reform battle would do to Senator Rubio, until now considered a rising star in the Republican Party.  ”Now, Marco, to his credit, is the only one of the group, the Gang of Eight, to criticize the bill.  He says it needs to be improved.  But he also recently said that 96 percent of it was perfect… and that’s not accurate.”  Sessions found it odd that Rubio hasn’t appeared with the seven co-forgers of this legislative Excalibur for over two months.

“He wants to solve a big national problem, and it’s not easy to do so,” Sessions said of Rubio.  ”The problem was, we had several of our members within the Republican conference, the most liberal on immigration, who went and met with Chuck Schumer, Dick Durbin, Bob Menendez – the most liberal members of the Democrat conference on immigration!  And with President Obama, and the special interests, they wrote a bill.  And it’s not a good bill for America.”

In response to Rep. Paul Ryan’s offer to debate anyone who says the immigration bill represents amnesty, Sessions said he loved Rep. Ryan, but… “Look it’s amnesty.  They have to pay a fine, it’s $2,000 over ten years, that’s about $18 a month… Amnesty is what you want it to mean.  I believe for most Americans, it means somebody is basically forgiven for their error, and they’re given a full path to citizenship in the United States of America, and that’s what this bill does.  It has some steps you have to undertake, but it’s still basically not requiring them to be deported, as the law requires.  It allows them to stay here permanently.  They’ll immediately be given Social Security numbers, and the ability to compete for any job in America immediately… and then they’re put on a path to permanent residence and citizenship… what do you call that?”

He concluded by judging the fate of the Gang of Eight bill uncertain, but said the Senate should kill it.  He seemed to think that was more likely to happen in the House, whose “good work” he encouraged listeners to appreciate.

The post Sen. Sessions: Gang of Eight immigration bill “nowhere close to what the American people really want.” appeared first on Human Events.

Stocks soared today due to growth-oriented sectors rallying on expectations that the Fed will maintain its current level of bond purchases when it issues its policy statement tomorrow. The Fed began its two-day meeting today, and traders are still debating whether the Fed will begin to wind down its purchases of $85 billion per month of bonds, or known as quantitative easing. Uri Landesman, president of Platinum Partners in New York, said: “Odds are the news isn’t as good as what people are expecting.”

Dollar Gains on Yen Ahead of Fed (Reuters)

The dollar rose against the yen today for a second straight session, as traders bet that the Federal Reserve may signal it will reduce its bond buying program. If the Fed decides to do so, the tapering would boost the dollar, which has been hit by the Fed’s easy money policies during the past few years. “The yen’s fresh leg lower today could be a sign that many investors think the Fed will signal a reasonable chance of a taper as later in the third quarter,” said Joe Manimbo, senior market analyst at Western Union Business Solutions in Washington.

Health-Care Cost Inflation to Stunt in 2014 (CNBC)

According to a recent report, sluggish health-care inflation is expected to slow down even more so in 2014 as consumers, employers and the federal government continue to cut medical costs. In addition, the rate of health-care inflation could drop in the future as Obamacare takes full effect and employers and consumers pay greater attention to costs. “For an industry that until recently has consistently seen double-digit growth, the ongoing slow-down poses immediate financial challenges,” the report noted.

The post Wall Street Rises on Fed Hopes; Dollar Gains on Yen; Health-Care Cost Inflation to Stunt in 2014 appeared first on Human Events.

My view, which I discussed this past weekend when I appeared on The Wall Street Report and advised subscribers to PowerTrend Profits and ETF PowerTrader, is that the Fed is not likely to taper near term. Data collected during the last few weeks and as recently as earlier this week confirms the U.S. economy once again has entered yet another spring swoon. Just yesterday, the New York Fed’s own Empire Manufacturing Survey for June boosted the case for no near-term tapering:

• “The new orders index slipped six points to -6.7, the shipments index fell twelve points to -11.8 and the unfilled orders index fell eight points to -14.5.”
• “Labor market conditions worsened, with the index for number of employees dropping to zero and the average workweek index retreating ten points to -11.3. Continuing the trend seen in the past few months, indexes for the six-month outlook declined, suggesting that optimism about future conditions was weakening further.”

That situation doesn’t paint a pretty picture. While it is easy to get overly downbeat, as I’ve shared with subscribers to PowerTrend Profits, there are pockets of strength in the economy.

In one of this week’s two PowerTalks, Douglas Holtz-Eakin and I talk about those pockets of strength, as well as what can be done to help stimulate growth further without adding to the debt burden that we are increasingly putting on further generations. For those not familiar with Doug, he’s president of the American Action Forum and recent commissioner on the Congressionally chartered Financial Crisis Inquiry Commission. Prior to that, Doug was the chief economist of the President’s Council of Economic Advisers from 2001-2002. As you’ll hear, he’ll share his view that there is much to go in the auto and housing rebounds, and the need for a tax overhaul if we really want to jumpstart the U.S. economy.

Listen now:

Weighing in on that last point and others is Diana Furchtgott-Roth, a senior fellow at the Manhattan Institute for Policy Research, as well as a contributing editor of RealClearMarkets.com and a columnist for the Washington Examiner, MarketWatch.com and Tax Notes. Diana and I touch on the downside of more regulation, as well as how the government’s role in backing certain companies and technologies like those found at Solyndra practically almost guaranteed their failure. It’s also why Diana says the Affordable Care Act is “built to fail.”

Listen now:

Special introductory offer: Right now you can try Chris Versace’s PowerTrend Profits risk-free for only $99.95! Find out how, here.

Access prior PowerTalk interviews here:

Sizing up Cyber Security with Sourcefire (FIRE) CTO and Founder Martin Roesch

Online Gaming with Ultimate Gaming Chairman Tom Breitling

Unveiling the Future of Coupons with Michael Vivio, president of Cox Target Media

Immigration and Immigration Reform with former Secretary of Commerce Carlos Gutierrez

Steve Forbes Focuses on the Economy, Taxes, Health Care and Obama

Susan Crawford, Author of “Captive Audience: The Telecom Industry and Monopoly Power in the New Gilded Age”

Paul Musselman, CEO of Carnegie Speech

Jim Nolan, EVP of InterDigital (IDCC)

Manish Chandra, Founder and CEO of Poshmark

Michael D. Brown, Customer Experience Expert

Debra Kaye, Partner at Lucule Consulting

Beth Solomon, President and CEO of NADCO

Bob Keheller Founder of The Employee Engagement Group

Stephen Moore of the Wall Street Journal

Currency Expert Bernard Lietaer

CEO of Accellion Yorgen Edholm

Founder and former CEO of Staples Tom Stemberg

Bestselling author Daniel Pink

dwinQ’s Patrick Sweeney

Cuttone & Company’s Keith Bliss

Visa’s Jason Alderman

GM’s Greg Martin

Consumer Electronic Association CEO Gary Shapiro

Smith & Wesson CEO James Debney

Mobile Payment expert Matt Jacobson

For more on Chris Versace and PowerTrends, click here. Or visit www.ChrisVersace.com

Press Contact: Alberto Rojas (202) 677-4474 * arojas@eaglepub.com

The post PowerTalk: What You Need to Know as the Fed Gets Ready to Taper its Stimulus: Advice from Experts Douglas Holtz-Eakin and Diana Furchtgott-Roth appeared first on Human Events.

To reiterate my earlier reservations, I’m not a big fan of party switchers.  Party affiliation is a big deal, something voters take into account when casting their ballots.  Switching parties in the middle of a term has never seemed entirely fair to me.

Having said that, I thought Guillory’s speech at the time of his party switch was excellent, and this video is even better.  The gentleman from Louisiana is playing my tune when he says, “At the heart of liberalism is the idea that only a great and powerful Big Government can be the benefactor of social justice for all Americans.  But the Left is concerned with one thing: control.  And they disguise this control as charity.”

“The idea that blacks – or anyone else, for that matter – need the government to get ahead in life is despicable,” says Guillory.  ”And even more important, this idea is a failure.  Our communities are just as poor as they have always been.  Our schools continue to fail our children.  Our prisons are filled with young black men who should be at home, being fathers.  Our self-initiative, and our self-reliance, have been sacrificed, in exchange for allegiance to our overseers.”

The post Elbert Guillory explains why he went Republican appeared first on Human Events.

While U.S. stocks have soared this year, the largest emerging market exchange-traded funds (ETFs) have fallen off a cliff over the past month or so. The iShares MSCI Emerging Markets Index Fund (EEM) is down 10.55% since the start of 2013. That compares with gains of more than 15.47% for the S&P 500.

As a result, much of the world’s “smart money” has egg on its face.

In early 2013, investment bank Credit Suisse surveyed over 500 market participants with more than $1 trillion in assets under management who all pegged emerging markets as the top-performing asset class for 2013.

I’m feeling their pain.

After all, I chose a leveraged bet on emerging markets as my #1 pick for 2013 in the annual TheStockAdvisors.com stock-picking contest.

So right now, you probably think you’d have to be crazy to want to invest in emerging markets.

But that’s, of course, precisely the reason you should do exactly that.

The Investment Case for Emerging Markets

My recommendation that you invest in emerging markets today has nothing to do with Jim Rogers’ prediction that your granddaughter may end up as a nanny to a wealthy Chinese family in Shanghai.

And it has everything to do with your gut instinct of why you don’t want to touch emerging markets with a 10-foot pole.

So let me reveal why I expect emerging markets to rally between now and the end of the year.

1) U.S. markets’ outperformance of 26.02% versus the emerging markets over the past six months has been as wide as I have ever seen it over such a short period. Whenever things get this far out of whack, you can expect a “reversion to the mean.”

2) Technically, emerging markets are as oversold as they have been since May 2012. The last time they hit this low level, they rallied 20% over the next six months.

3) The world’s top-performing stock market in 2013 — the Philippines — has tumbled more than 20% in the past few weeks. There are riots in the streets in Turkey. The China bubble has popped and is taking commodities-based economies like Brazil and Russia down with it. Sentiment about emerging markets could hardly be worse.

How to Best Invest in Emerging Markets

Up until recently, the “no brainer” way to invest in emerging markets has been through large-cap index funds, like widely held emerging market exchange-traded funds (ETFs) Vanguard FTSE Emerging Markets (VWO) and iShares MSCI Emerging Markets (EEM).

As market cap weighted indexes, these mainstream ETFs favor large companies: mega-cap resource exporters and state-owned enterprises or companies that depend on exports and government policy.

In fact, a big chunk of their exposure is to the “BRICs” — Russia, India, China and Brazil, which together account for approximately 44% the weight of the MSCI Emerging Markets Index. This also explains the MSCI emerging markets index’s recent lousy performance. In 2013 alone, BRIC markets are down by an average of 14.28%.
Then I came upon an interesting and profitable anomaly.

As I was reviewing the performance of my “Ivy Plus” Investment Program at my firm Global Guru Capital over the first five months of 2013, I saw that emerging market small cap stocks avoided much of the widespread sell-off in emerging markets.

As of yesterday, the program’s allocation to emerging market small caps through the Wisdom Tree Emerging Markets Small Cap Dividend Index (DGS) has fallen only 2.02% so far this year, outperforming the iShares MSCI Emerging Markets Index Fund (EEM) by an eye-popping 8.5%.

That’s nothing new. The WisdomTree Emerging Markets SmallCap Dividend Index has strongly outperformed its big brother, the iShares MSCI Emerging Markets Index, over the past five years.

That’s also why I recently recommended Wisdom Tree Emerging Markets Small Cap Dividend Index (DGS) in my Alpha Investor Letter investment service.

The Global ‘Small Cap’ Effect

So what’s the “secret” behind the Wisdom Tree Emerging Markets Small Cap Dividend Index’s (DGS) success? In two words: “small caps.”

The University of Chicago’s Eugene Fama and Kenneth French have long argued that small-cap stocks should generate higher returns than large large-cap stocks.

Higher growth rates lead to higher volatility and generate higher returns. More intuitively, small caps are more nimble and are quicker to react to changing market conditions, making them ultimately more profitable investments. Indeed, U.S. small-cap stocks have substantially outperformed large-cap stocks over history.

As it turns out, the small-cap effect applies to emerging markets, as well. In fact, recent research has confirmed that the “risk premium” — and hence the higher returns — of small caps in emerging markets is even greater than for small caps in the United States.
No wonder international small caps have been the single best-performing equity asset class over the past decade.

Emerging Market Small Caps: Better Than Templeton

From its inception in 2007 through December 31, 2012, DGS ranked ninth in a group of 258 U.S. ETFs and open-end mutual funds in the diversified emerging markets category. That means it beat approximately 97% of funds in its category.

And just look at how DGS has trounced the Templeton Emerging Markets Fund, Inc. (EMF) — managed by emerging markets guru Mark Mobius — over the past five years.

So let me venture a not-so-bold prediction…

Five years from now, emerging market small caps will have substantially outperformed both the U.S. S&P 500 and the mainstream MSCI Emerging Markets Index.

And today is as good a time as any to place that long-term bet.

To read my e-letter from last week’s Eagle Daily Investor, please click here. I also invite you to comment about my column in the space provided below my Eagle Daily Investor commentary.

Sincerely,

Nicholas Vardy, CFA
Editor, The Global Guru
Subscribe to my Newsletter and Trading Services.
Follow me on Twitter.
Check out my Blog.

The post The Global Guru: Go Big, Go Bold: Bet on Emerging Markets appeared first on Human Events.

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Thursday, while he was ringing in Gay Pride Month with LGBT revelers, a staffer, Ben Rhodes, informed the White House press that U.S. weapons will be going to the Syrian rebels.

For two years Obama has stayed out of this sectarian-civil war that has consumed 90,000 lives. Why is he going in now?

The White House claims it now has proof Bashar Assad used sarin gas to kill 100-150 people, thus crossing a “red line” Obama had set down as a “game changer.” Defied, his credibility challenged, he had to do something.

Yet Assad’s alleged use of sarin to justify U.S. intervention seems less like our reason for getting into this war than our excuse.

For the White House decided to intervene weeks ago, before the use of sarin was confirmed. And why would Assad have used only tiny traces? Where is the photographic evidence of the disfigured dead?

What proof have we the rebels did not fabricate the use of sarin or use it themselves to get the gullible Americans to fight their war?

Yet, why would President Obama, whose proud boast is that he will have extricated us from the Afghan and Iraq wars, as Dwight Eisenhower did from the Korean War, plunge us into a new war?

He has been under severe political and foreign pressure to do something after Assad and Hezbollah recaptured the strategic town of Qusair and began preparing to recapture Aleppo, the largest city.

Should Assad succeed, it would mean a decisive defeat for the rebels and their backers: the Turks, Saudis and Qataris. And it would mean a geostrategic victory for Iran, Hezbollah and Russia, who have proven themselves reliable allies.

To prevent this defeat and humiliation, we are now going to ship arms and ammunition to keep the rebels going and in control of enough territory to negotiate a peace that will remove Assad.

We are going to make this a fair fight.

What is wrong with this strategy? It is the policy of an amateur. It treats war like a game. It ignores the lessons of history. And, as it continues a bloodbath with no prospect of an end to it, it is immoral.

In every great civil war of modernity — the Russian civil war of 1919-1921, the Spanish civil war of 1936-1939, the Chinese civil war of 1945-49, one side triumphs and takes power. The other loses and lives with the consequences — defeat, death, exile.

What is the likely reaction to our escalation from humanitarian aid to military aid? Counter-escalation. Russia, Iran and Hezbollah are likely to rush in more weapons and troops to accelerate the progress of Assad’s army before the American weapons arrive.

And if they raise and call, what does Obama do?

Already, a clamor is being heard from our clients in the Middle East and Congress to crater Syria’s runways with cruise missiles, to send heavy weapons to the rebels, to destroy Assad’s air force on the ground, to bomb his antiaircraft sites.

All of these are acts of war. Yet under the Constitution, Congress alone authorizes war.

When did Congress authorize Obama to take us to war in Syria? Where does our imperial president get his authority to draw red lines and attack countries that cross them?

Have we ceased to be a republic? Has Congress become a mere spectator to presidential decisions on war and peace?

As Vladimir Putin seems less the reluctant warrior, what do we do if Moscow answers the U.S. escalation by delivering on its contract to provide S-300 antiaircraft missiles to Damascus, which can cover half of Israel?

Obama has put us on the escalator to a war already spilling over Syria’s borders into Turkey, Lebanon, Iraq and Jordan, a war that is now sundering the entire Middle East along Sunni and Shia lines.

He is making us de facto allies of the Al-Qaida-like al-Nusra Front, of Hamas and jihadists from all across the region, and of the Muslim Brotherhood. Egypt’s President Mohammed Morsi just severed ties to Syria and is demanding a “no-fly zone,” which one imagines the United States, not the Egyptian air force, would have to enforce.

Our elites shed tears over the 90,000 dead in Syria. But what we are about to do will not stop the killing, but simply lengthen the duration of the war and increase the numbers of dead and wounded.

At the top of this escalator our country has begun to ascend is not just a proxy war with Iran in Syria, but a real war that would entail a disaster for the world economy.

If the ouster of Assad is what the Sunni powers of Turkey, Saudi Arabia and Egypt demand, why not let them do it?

Anti-interventionists should demand a roll-call vote in Congress on whether Obama has the authority to take us into this Syrian war.

Patrick J. Buchanan is the author of “Suicide of a Superpower: Will America Survive to 2025?”

The post A Reluctant Warrior
Tiptoes to War appeared first on Human Events.

Bush chose to deal with this unease by attacking the uneasy, referring to them as “chirpers” in a CBN interview following his appearance before the Faith and Freedom Coalition.  ”I will be able to, I think, manage my way through all the ‘chirpers’ out there,” he said, apparently playing off Senator John McCain’s reference to his conservative colleagues Ted Cruz, Rand Paul, and Mike Lee as “wacko birds.”  Bush’s comment comes near the end of the video clip embedded below:

Bush does have some good conservative points in his resume, and I’ve always thought it was facile to assume he can’t possibly win based solely on his last name.  (I’d compute it as a net minus, especially if the Democrats don’t run Hillary Clinton, because then they could exploit the general American reluctance to establish political dynasties.  But it’s not an insurmountable obstacle.)

But are Republicans really eager to run another candidate who drops a lot of “inartful” statements?  Last week, at another Faith and Freedom Coalition event, he said this: “Immigrants create far more businesses than native-born Americans.  Immigrants are more fertile, and they love families, and they have more intact families, and they bring a younger population.  Immigrants create an engine of economic prosperity.”

There might be a valid demographic point buried in there somewhere, and it plays into Bush’s view of the importance of traditional families for every demographic, as he mentioned in the CBN video above… but “immigrants are more fertile?”  Hoo boy.  I would not relish running a campaign with sound bites like that hanging from my neck.

And do we really want another candidate who runs harder against Republicans than he does against the Democrat?  Do the A-list Democrat candidates ever disrespect parts of their own coalition by calling them names?  That seems to be an exclusive fetish of the Stupid Party, in part because the media’s not interested in goading Democrats into public battles with large segments of their base.  They’re not even terribly interested in forcing Democrats to denounce their extremists.

Too many Republicans at the top of the ticket underestimate the effects of damaging the Republican brand.  They don’t understand how indelicate criticism and name-calling come back to haunt them.  They’ll receive no credit from the media for needling the people they don’t like, and it doesn’t sway a lot of moderate Democrats or independents, because they’re not attracted to a party that seems to be at war with itself.  But they do manage to depress their own base turnout.  The Republican base includes plenty of serious voters with long memories.  Do we need another lesson in how they’ll stay home during the general election, if they were insulted during the primary, or even long before the primary begins?

There will always be factional struggles during the run-up to a national election.  Democrats have them too.  Some of Hillary Clinton’s most loyal supporters are still miffed at the way she was treated by the Obama campaign in 2008.  But I don’t recall Barack Obama calling Hillary’s supporters names, or describing them as an obstacle he thought he could “manage.”

The post Jeb Bush versus the “chirpers” appeared first on Human Events.

Petroleos Mexicanos (Pemex Oil) is Mexico’s 75-year old state run energy monopoly. But if Mexican President Enrique Pena Nieto has his way, it won’t live to see a 76th birthday. It is his hope that by allowing multinational oil companies to rejoin Mexico’s energy market, an eight-year slide in Mexican crude output will end. In a best-case scenario, President Pena Nieto hopes his country would experience a resource revolution similar to that in the United States. The biggest hurdle remaining for foreign oil companies to return to Mexico is the country’s constitution — which cannot be amended to allow foreign company participation until September… Until then, if you’re a Pemex investor, you may want to start preparing an exit strategy.

Run on Russia: Property Values on the Rise (CNBC)

In the not-so-distant past, Russian oligarchs had to look beyond their own borders for luxury real estate locations befitting men and women of their stature. That’s not the case any longer, at least according to Olga Tarakanova, head of City Sales at Knight Frank Russia, who told CNBC that new luxury digs being built in Moscow are comparable to high-end properties in London or Paris. And they’re beginning to sport the prices to match. “The value of most properties on the market during the last 3-4 years has risen twice… There is a great opportunity to earn on investments ranging from 30 to 70 percent per annum in Moscow,” Tarakanova said. That opportunity, however, is limited to investors with oligarch-sized checkbooks.

Markets Tiptoe up to Fed Announcement Wednesday (AP)

For the last couple of weeks, global markets have sat on pins and needles awaiting this week’s Fed meeting. The major concern is how much longer the United States will continue its quantitative-easing (QE) policy of buying $85 billion worth of debt monthly. Should the Bernanke Boys announce a tapering (reduction) in buying — even if it is months down the road — investors could turn and run for the exits. That reality certainly was the case yesterday, when an article in the Financial Times prompted some selling in U.S. markets — and that was based purely on speculation. The uncertainty will end Wednesday afternoon when the Fed issues a statement.

The post Pemex Oil Still Playing Monopoly at 75… But Not Much Longer; Run on Russia: Property Values on the Rise; Markets Tiptoe up to Fed Announcement Wednesday appeared first on Human Events.