02.09.09

The Economic Stimulus Bill

Posted in my view, Policy at 9:08 pm by Lalita Haran

The U.S. Senate adopted the “Sanders Bill” by a voice vote after the Bill was amended. The Bill allows a financial institution to benefit from the government offered stimulus and as a condition, makes it harder for the institution to hire foreign nationals on H-1 visa or even receive extension of such visa for those in the employ. The present time limit for the restriction is two years.

It is hard to believe a proposal that tantamounts to “protection” of employment in favor of the U.S. nationals is being adopted in the U.S., country that has been a protagonist of international free trade and commerce and has been a live example of the advantages of open economy with least government interference. Is it a sign of a change in U.S. ideology or merely an effort to politicise the immigration issue once again? Reminds me of the lessons I learnt in my economics class on why protection does more bad than good.

Generally, the reason for America’s role as a world leader in the economy was due to its passion for talent and the freedom it gives the talent to grow along side the employer hiring such talent. The opportunities created themselves within the country and then abroad creating multinational companies. The reason being, international trade and commerce leads to national economic growth and promotes competition that brings efficiency.

It is a common fear, that any protectionistic umbrella generally takes away the incentive to compete and so such a measure for the financial institutions to start with and percolating to other industries in U.S., would shun the human talent from around the world that the nation had welcome, enjoyed and exploited for the benefit of itself and for everyone else. Similar protectionist steps adopted by other countries would be detrimental to international trade and commerce. Recession, being a global phenomenon, an effort to combat it should properly consider its international aspect.

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