Adapting to Climate Change—Three Success Stories [feedly]

Adapting to Climate Change—Three Success Stories
https://blogs.imf.org/2018/03/20/adapting-to-climate-change-three-success-stories/

By Evgenia Pugacheva and Mico Mrkaic

March 20, 2018

When governments subsidize private investment in adaptation, the economic costs of extreme weather events can be reduced (photo: Leolintang/iStock by Getty Images).

Climate change is one of the greatest threats facing our planet. Its negative effects on health, the biosphere, and labor productivity are already being felt throughout the world. Aware of the danger, communities, households, and governments have started taking measures to reduce their exposures and vulnerability to weather shocks and climate change. Our study in the World Economic Outlook shows that public investment in adaptation can partially reduce the economic costs of severe weather events.  

Government involvement is key

In our previous blog, we used historial evidence to show how a 1°C increase in temperature in a country with an average annual temperature of 25°C, such as Bangladesh, Haiti, and Gabon, would reduce per capita output by 1.5 percent—a loss that persists for at least 7 years. What would the benefits be if governments provided incentives for investing in adaptation to climate change? Our model simulations suggest that the benefits can be significant.

Households and firms already invest in adaptation to reduce the impact of changing weather conditions—for example, by planting more heat-resistant crops or investing in green infrastructure. But the benefits of many adaptation measures do not accrue solely to those who make the investment. For example, an early-warning system for extreme weather will be enjoyed freely by everyone living in the area.

Because households and firms do not take into account the full social benefits of these investments, governments will need to step in. Using a dynamic general equilibrium model, we show that if governments subsidize private investment in adaptation, the economic burden of weather shocks could be partially reduced.

 

Moreover, due to the smaller damage to output, the reduced losses from weather shocks as a result of investing in adaptation measures could significantly exceed the cost to the public coffers over time.

Our model simulation illustrates a general principle that governments should support adaptation to improve resilience and reduce the impact of weather-related shocks. Many governments have already started implementing strategies to bolster climate change adaptation. And there have been successes.

Social safety nets in Ethiopia

In 2006, the Ethiopian government and international partners established the Productive Safety Net Program. The program provides cash and food to families that are unable to feed themselves due to droughts, delayed rains, and flooding that threaten food security. The aid is contingent on participation in local productivity-enhancing or environmental programs—for example, land rehabilitation, improvement of water sources, and construction of infrastructure such as roads and hospitals.

Program beneficiaries experience a 25 percent smaller drop in consumption after droughts relative to those not in the program. The program has also reduced soil loss by more than 40 percent, improved availability of water, and increased land productivity.

Climate-smart infrastructure in Malaysia

The Stormwater Management and Road Tunnel (SMART Tunnel) in Kuala Lumpur, Malaysia, serves a dual purpose: it carries traffic and helps combat flash floods. The tunnel consists of three levels. Normally, the top two levels carry road traffic. However, they can be temporarily used as storm drains. At a cost of about $500 million, the SMART Tunnel is expected to prevent more than $1.5 billion in flood damage and reduce the costs of traffic congestion by more than $1 billion over the next 30 years.

 Centralized air conditioning in India

High temperatures reduce labor productivity and can also harm health. Air-conditioning is the most common solution to deal with excessive heat. However, the negative effects of air-conditioning, such as increased energy consumption and pollution, cannot be ignored. Moreover, high up-front costs and infrastructure requirements push air conditioning out of reach for poor and vulnerable populations, especially in low-income countries.

District cooling, a centralized air-conditioning system where centrally chilled water is distributed to consumers through underground pipes, can reduce these negative effects. It is in use in several major cities in advanced economies and is currently under construction by the Government of Gujarat, India, in the Gujarat International Finance Tec-City. Centralized cooling systems reduce cost and pollution by consuming 35 to 50 percent less energy than individual air cooling units. These systems unburden the electricity sector and make indoor climate control more accessible by eliminating the up-front cost for its users.

Averting the crisis

Climate change adaptation can lessen the economic costs of climate change, as illustrated by our model simulation and various examples around the world. But investing in successful adaptation strategies is expensive. It will further stretch the budgets of already very poor countries, where the adverse effects of climate change are most pronounced.

Hence, it is imperative that the international community, particularly the advanced economies, which have emitted the lion's share of greenhouse gasses, help finance adaptation related projects in poorer countries.

That said, adaptation alone is not enough. The only long-term solution for the climate change crisis is to sharply reduce the greenhouse gas emissions responsible for Earth's warming.

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Detroit News: Trump steel tariffs could hurt U.S. autos

Trump steel tariffs could hurt U.S. autos

Ian Thibodeau and Jim Lynch, The Detroit NewsPublished 11:20 p.m. ET July 16, 2017

(Photo: Tom Mihalek / Getty Images)

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Tariffs might help U.S. steel companies, but a crackdown on imports by President Donald Trump could hurt U.S. automakers and other industries – and raise prices for buyers of their goods.

The Trump administration is considering tariffs on steel imports in an effort to squeeze China and other countries that Trump says are destroying the U.S. steel industry. No action has been taken, but auto industry analysts and trade experts say the threats already have created uncertainty in the market.

Even though U.S. automakers build vehicles primarily from U.S.-sourced steel, economists say a protective tax on imported steel would give makers of domestic steel the incentive to raise their prices – just because they could. That would be a boon for the domestic steel industry, but it would make U.S.-made cars more expensive and push consumers to buy cheaper cars from foreign companies unaffected by the tariff, economists say.

"Prices will go up and people will buy less," said Alan Deardorff, professor of public policy and economics at the University of Michigan. "It's ironic that in discouraging imports of steel, he may encourage the imports of cars."

The latest discussions over trade – and steel in particular – arose after transcripts of a Wednesday media session held by Trump on Air Force One were published. In a question-and-answer session, the president described the influx of cheap foreign steel as "a big problem."

"They're dumping steel and destroying our steel industry; they've been doing it for decades, and I'm stopping it," Trump told reporters. "It'll stop...

"There are two ways – quotas and tariffs. Maybe I'll do both."

Robert E. Scott, a senior economist and director of trade and manufacturing policy research for the Economic Policy Institute, in a blog post Tuesday underscored the dilemma in economic sanctions.

One segment of the economy – manufacturers that use cheaper foreign steel – could be hamstrung with rising materials costs, he said.

At the same time, tariffs and quotas would save jobs in the U.S. steel and aluminum industries from near-term threats and help domestic producers recover from unfair trade.

"In the best of cases," Scott said, "tariffs can be used to encourage other importers to develop common policy to address overcapacity and overproduction by China and other major exporters."

While it is unclear what steps might be most effective, there is mounting pressure for Trump to act.

"Chinese steel overproduction is one of the most significant contributors to American manufacturing job loss," U.S. Rep. Debbie Dingell of Michigan said in an emailed response to questions. "We need stronger trade enforcement to protect against countries who cheat. President Trump should follow through on his promise to hold foreign governments accountable for illegal trade practices that continue to put American workers at a disadvantage."

In June, Trump asked the U.S. Department of Commerce to conduct what's known as a Section 232 investigation into steel and aluminum imports to determine whether they are hurting U.S. national security. If the government finds a threat there, the rarely used investigation would allow the administration to levy "protective" tariffs against a country or group of countries. Experts expect Trump to argue that the military needs domestic steel for military operations, and that the "dumping" of foreign steel is harming U.S. steel mills.

However, the voices urging Trump to exercise caution are growing louder. Perhaps most prominent is a bipartisan group of 15 former White House economic officials who drafted a letter to the president this week. They specifically took issue with the idea of tariffs imposed on supposed national security threats.

"The diplomatic costs might be worth it if the tariffs generated economic benefits. But they would not," the panel wrote. "Additional steel tariffs would actually damage the U.S. economy. Tariffs would actually raise costs for manufacturers, reduce employment in manufacturing and increase prices for consumers."

Compounding the problem, they wrote, is the fact that other countries where U.S. automakers do business could also be hurt by tariffs. Among the 110 countries the U.S. imports steel from are allies such as Canada and Mexico.

"Additional tariffs would likely do harm to our relations with these friendly nations," the group wrote.

Ford Motor Co. said it buys 95 percent of steel and 98 percent of aluminum used in its American-built vehicles from U.S. manufacturers. The company deferred further comment to the American Automotive Policy Council, a trade group representing Ford, Fiat Chrysler Automobiles and General Motors Co.

In May, that group submitted two documents to the U.S. government commenting on the Section 232 investigation.

U.S. automakers buy 15 percent of all the steel consumed in the U.S., a vast majority of which is domestically sourced, according to one document.

"(If) the president were to increase tariffs on foreign steel or impose other import restrictions, the auto industry and the U.S. workers that the industry employs would be adversely affected, and (this) unintended negative impact would exceed the benefit provided to the steel industry from this executive action," read the document. "Inevitably, the imposition of across the board higher tariffs or other restrictions on imports of steel into the United States would only widen the existing price gap by increasing the price of U.S. steel and thus the cost of U.S.-built vehicles.

"This would lead to lower sales of domestically built cars and trucks in the highly competitive U.S. auto market, a decrease in U.S. auto exports, and a loss of the jobs that those economic activities support."

Representatives from the Fiat Chrysler and GM declined to comment directly on the potential tariffs.

Representatives from the United Auto Workers union and the Alliance of Automobile Manufacturers – a trade group that represents a dozen carmakers that operate in the U.S., including the Detroit Three – said they could not comment on the president's trade dealings with China, because the Trump administration has not given a clear outline of its plans.

However, in a June 12 letter to U.S. Trade Representative Robert Lighthizer that addressed renegotiation of the North American Free Trade Agreement, auto alliance President and CEO Mitch Bainwol wrote: "Today's highly complex automobile is a product comprised of thousands of parts sourced from a global network of thousands of suppliers. ... Disrupting this integrated supply chain would increase prices, lower sales, threaten exports and endanger American workers' jobs."

Trump could target China through a number of different trade avenues, but even with a possible steel tariff looming, uncertainty likely has put the plateauing U.S. auto industry in a holding pattern, believe Deardorff and Kristin Dziczek, director of the industry, labor and economics group at the Center for Automotive Research.

"The auto industry hates risk," said Dziczek. "They hate uncertainty. Uncertainty creates risk in the industry, and risk costs money."

If the tariff is levied on all steel imports, U.S. steel companies would raise prices as well. Many of the vehicles produced in the U.S. are made with U.S. steel. So, auto companies and suppliers would absorb those cost increases for a short time, but eventually the cost of a vehicle made with U.S. steel would increase.

Though plenty of foreign automakers build cars in the U.S., models made outside the country would dodge the steel tariff, keeping prices low on vehicles imported here. That makes U.S. auto companies less competitive, says Deardorff, and would potentially lead to job losses despite short-term gains in the steel industry.

In the meantime, Trump is creating more uncertainty than anything, according to Dziczek and Deardorff.

"Uncertainty is almost like a tax," said Deardorff. "It discourages any kind of activity."

ithibodeau@detroitnews.com

Twitter: @Ian_Thibodeau

--

John Case
Harpers Ferry, WV

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Krugman: Bumbling into a Trade War

Bumbling Into a Trade War

"Trade wars are good, and easy to win." So declared Donald Trump a few weeks ago, after announcing tariffs on steel and aluminum. Actually, trade wars are rarely good, and not at all easy to win — especially if you have no idea what you're doing. And boy, do these people not know what they're doing.

It's odd, in a way. After all, trade is clearly an issue about which Trump is truly passionate. He tried to kill Obamacare, but to all appearances his main concern was tarnishing his predecessor's legacy. He wanted a tax cut, but more to score a "win" than because he cared about what was in it. But reducing the trade deficit has been a long-term Trump obsession, so you might expect him to learn something about how world trade works, or at least surround himself with people who do understand the subject.

But he hasn't. And what he doesn't know can and will hurt you.

In the case of steel, here's what happened: First came the splashy announcement of big tariffs, ostensibly in the name of national security — infuriating U.S. allies, which are the main source of our steel imports. Then came what looks like a climb-down: The administration has exempted Canada, Mexico, the European Union and others from those tariffs.

Was this climb-down a reaction to threats of retaliation, or did the administration not at first realize that the tariffs would mainly hit our allies? Either way, Trump may have gotten the worst of both worlds: angering countries that should be our friends and establishing a reputation as an untrustworthy ally and trading partner, without even doing much for the industry he was supposedly trying to help.

Now comes Trumptrade II, the China Syndrome. On Thursday the administration announced that it would levy tariffs on a number of Chinese goods, with the specifics to be detailed later. How will this one work out?

Let's be clear: When it comes to the global economic order, China is in fact a bad citizen. In particular, it plays fast and loose on intellectual property, in effect ripping off technologies and ideas developed elsewhere. It also subsidizes some industries, including steel, contributing to world excess capacity.

But while his coterie mentions these issues, Trump seems fixated on the U.S. trade deficit with China, which he keeps saying is $500 billion. (It's actually $375 billion, but who's counting?)

What's wrong with this fixation?

First of all, much of that big deficit is a statistical illusion. China is, as some put it, the Great Assembler: Many Chinese exports are actually put together from parts produced elsewhere, especially South Korea and Japan. The classic example is the iPhone, which is "made in China" but in which Chinese labor and capital account for only a few percent of the final price.

That's an extreme example, but part of a broader pattern: Much of the apparent U.S. trade deficit with China — probably almost half — is really a deficit with the countries that sell components to Chinese industry (and with which China runs deficits). This in turn has two implications: America has much less trade leverage over China than Trump imagines, and a trade war with "China" will anger a wider group of co

untries, some of them close allies.

More important, China's overall trade surplus is not currently a major problem either for the United States or the world as a whole.

I use the word "currently" advisedly. There was a time, not that long ago, when the U.S. had high unemployment and China, by keeping its currency undervalued and running big trade surpluses, made that unemployment problem worse. And at the time I was calling for the U.S. to play hardball on the issue.

But that was then. Chinese trade surpluses have come way down; meanwhile, the U.S. no longer has high unemployment. Trump may think that our trade deficit with China means that it's winning and we're losing, but it just ain't so. Chinese trade — as opposed to other forms of Chinese malpractice — is the wrong issue to get worked up over in the world of 2018.

And here's the thing: By bumbling into a trade war, Trump undermines our ability to do anything about the real issues. If you want to pressure China into respecting intellectual property, you need to assemble a coalition

of nations hurt by Chinese ripoffs — that is, other advanced countries, like Japan, South Korea and European nations. Yet Trump is systematically alienating those countries, with things like his on-again-off-again steel tariff and his threat to put tariffs on goods that, while assembled in China, are mainly produced elsewhere.

All in all, Trump's trade policy is quickly turning into an object lesson in the wages of ignorance. By refusing to do its homework, the Trump team is managing to lose friends while failing to influence people.

The truth is that trade wars are bad, and almost everyone ends up losing economically. If anyone "wins," it will be nations that gain geopolitical influence because America is squandering its own reputation. And that means that to the extent that anyone emerges as a victor from the Trump trade war, it will be … China.

--

John Case
Harpers Ferry, WV

The Winners and Losers Radio Show

7-9 AM Weekdays, The Enlighten Radio Player Stream, 

Sign UP HERE to get the Weekly Program Notes.

Check out Socialist Economics, the Enlighten Radio website, and 

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Simon Wren Lewis: A road to right wing authoritarian government [feedly]

A road to right wing authoritarian government
http://mainlymacro.blogspot.com/2018/03/a-road-to-right-wing-authoritarian.html

This post is inspired by another, by Jan-Werner Müller. I have talked about Müller's ideas on populism before. This particular post is a plea to focus less on the voters who elect populist politicians, and more on the politicians themselves. He writes

"In 2010, Viktor Orbán did not campaign on a promise to draft a new constitution, weaken checks and balances, and radically reduce media pluralism. Instead, he presented himself as a competent mainstream Christian Democrat. In Poland, the Law and Justice (PiS) party went out of its way to stress its character as a reasonable conservative party which simply wanted to provide more benefits to families with children."

The idea that most voters should see beyond the mask to understand who politicians really are is ridiculous. As the 2016 US general election showed, the information content of the broadcast media can be increasingly small.

Does Trump provide a counterexample of this, because he was an 'outsider' who was elected? I would say no for two reasons. First, the Republican party had played a large part in creating the political environment that allowed his populism to win votes. Second, the Republican party seems quite content to behave in ways which complement Trump's authoritarianism. (By attackingthe CBO, for example.)

The message is that if you want to investigate populist regimes (using populist in the Müller sense)you need to look at political elites ratherthan the electorate. I think he is right. But what makes an elite adopt an authoritarian path? I am sure there are many answers to that question, but what I will try to do below (in no doubt a very 'untutored' way) is to show one route in what had been a pluralistic democracy by which elites from the right can move in a populist, authoritarian direction. I'm an economist, so I use a simple model.

Here is a two dimensional variation on the familiar left-right diagram. The additional dimension is sometimes called 'identity' or 'culture'. Let us assume that voters are evenly distributed inside the circle. (Not necessarily a good assumption: see here.) In a two party system you might expect both parties, if their main concern was to be elected, to adopt positions that put them close to the centre. This is because the party a voter will vote for is governed by the party that is nearest to them.

But suppose that a party wants to take a less centrist position, either because its backers wish this or because its politicians believe is some ideology. To be concrete, suppose the party of the right wants to adopt a very right wing economic policy that involves, for example, distributing income from most people to the very rich. In a one-dimensional left-right space such a party would be doomed. But suppose their opponents, for whatever reason, were fairly liberal. If we assume that the left is fairly moderate on economic issues, then that places the two parties at the position given by P in the diagram above. That leaves them evenly matched. (To see why, see below.).

The party on the right will want to focus on their socially conservative platform, while the party on the left will stress their more 'moderate' economic platform. This looks like a stable situation, which contains no threat to a pluralistic democracy. What could change to upset it? Here is just one possible route.

If the right has more influence on the media than the left, they can campaign on a platform that differs from the platform they intend to implement. If you can pretend that you are a moderate party on economic issues rather than an extreme right party, and this pretense works, then your party wins. So in terms of voter perception, the party on the right moves along the upper arrow from position P to C. The left party might respond in kind by pretending they are less liberal than they are, but because they have less media influence they cannot move so far from their true position. If we look at the campaign positions of the two parties, marked by C, it is intuitively clear that the right wing party wins any election. (The dotted lines show a proof – see [1])

We see this in the US with tax cuts (pushing the idea that lower corporation taxes will mainly raise wages), in the UK with austerity (which was really a policy to shrink the state much further than most wanted, dressed up as some kind of moralistic injunction that governments should be like households) and especially Brexit, where advocates pretended there would be no economic cost to leaving the EU. The counterpart of hiding a right wing position is to emphasise conservative issues. This is most obvious with the culture war in the US, together with the politics of race. In the UK the key social issue was immigration, which the Conservatives started focusingon from the late 1990s. (The great thing about immigration as an issue for the right is that it can be (falsely) given an economic dimension.) Again Brexit is an exemplar, with not just immigration ('protect our borders') but nationalism ('take back control').

While this results in short term gains for the right, as a tactic it is unstable in the longer term because governments once in power implement their real economic policies. We will move back from C to P on the lower arrow. Voters observe tax cuts for the better off at their expense, they observe the impact of austerity and, in the UK, they observe the consequences of Brexit. It may take some time, but right wing leaders know they are vulnerable to reality winning out over spin, so they may wish to take actions to offset the democratic consequences of being found out.

There are lots of directions this authoritarian turn can take. Taking greater control of the media, either directly by shutting down critical media or buying off media owners in exchange for support, is one direction we see takenin Hungary. Gerrymandering is favoured by Republicans in the US. Portraying opposition leaders as traitors is favoured in the UK. Ramping up nationalism and the 'threat' from immigration almost everywhere.

Politics that is exclusively along the social conservative/liberal axis can degenerate into a kind of identity politics where you just vote for your tribe. As Müller writes

"The problem starts when citizens view every issue purely as a matter of partisan identity, so that the credibility of climate science, for example, depends on whether one is a Republican or a Democrat. It gets worse when partisan identity becomes so strong that no arguments from or about the legitimacy of the other side ever get through."

The path to authoritarianism I set out here is not meant to be the whole story, and is not meant to correspond with any particular country. What I hope it does illustrate is how an authoritarian government can emerge when a party adopts a very right wing economic policy, and pretends it has not. It happens without voters changing their views or preferences in any way. It is authoritarian populism that comes from the behaviour of right wing elites.

[1] To see which party wins (assuming my geometry is correct), draw a line between the two positions, and then draw a line at right angles that bisects it. Every voter on that line is indifferent (equidistant) between the two parties, and therefore every voter either side of the line votes for each party.

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Hidden New Tax Breaks for Wealthy Households, Corporations Risk State Revenues [feedly]

Hidden New Tax Breaks for Wealthy Households, Corporations Risk State Revenues
https://www.cbpp.org/blog/hidden-new-tax-breaks-for-wealthy-households-corporations-risk-state-revenues

As states develop legislation to adapt their tax laws to the new federal tax law, corporate lobbyists and anti-tax advocates are trying to capitalize on the legislative process to secure state tax breaks that they've been seeking for years. If they succeed, states will lose tax revenues that they otherwise could be allocating to strengthen schools, infrastructure, and other state services by, instead, providing even more tax breaks for the wealthy and profitable corporations — sometimes with virtually no public debate or awareness.

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Congress is trying to use appropriations expand the H-2B temporary worker program—where migrants are exploitable and have few rights—by 73 percent [feedly]

Congress is trying to use appropriations expand the H-2B temporary worker program—where migrants are exploitable and have few rights—by 73 percent
https://www.epi.org/blog/congress-is-trying-to-use-appropriations-expand-the-h-2b-temporary-worker-program-where-migrants-are-exploitable-and-have-few-rights-by-73-percent/

....fine to have immigrants -- as long as they know they have no rights at all.

The GOP-led Congress is aiming to pass an omnibus appropriations bill to fund the federal government before the current temporary spending bill expires on March 23, 2018. Part of the negotiations include a major effort by legislators in both parties—who are being bombarded by corporate lobbyists in the hospitality, seafood, landscaping, and construction industries—to expand the H-2B temporary migrant worker program. We estimate the proposal would increase the number of H-2B workers that employers can hire in lesser-skilled occupations by at least 73 percent, from 66,000 per year to 114,000.

The H-2B program—like other temporary migrant worker programs—is not a work program that brings immigrants to the United States with equal rights and the option to stay permanently. Instead, it is used by employers carve out a lawless zone in the labor market where migrant workers have few workplace rights in practice, because they arrive indebted to labor recruiters and indentured to U.S. employers.

Nevertheless, rather than focusing on the most urgent immigration issues at hand, including a path to citizenship for immigrants who are in danger of becoming undocumented, like DACA recipients, and those who have Temporary Protected Status, Congress is instead focusing on making changes to temporary worker programs via the appropriations process. Congress has done this a number of times in recent years, something that Republican Senate Judiciary Chairman Sen. Chuck Grassley and Democratic Ranking Member Sen. Diane Feinstein came together last year to criticize for usurping the committee's jurisdiction over immigration legislation. Other Senators have done the same, including Dick Durbin and Bernie Sanders. The New York Times editorial page and migrant worker advocates alike have also criticized this end-around the normal legislative process.

A year ago we released a report, Temporary Foreign Workers by the Numbers, to help set the stage for a rational, evidence-based dialogue about the size of these programs and how they function, and to call for more and better data which are needed to further analyze the programs' impact on labor standards for migrant and American workers and the U.S. economy. We estimated that 1.42 million temporary foreign workers were employed in the United States with nonimmigrant visas in the major temporary migrant worker programs accounting for approximately 1 percent of the U.S. labor force in fiscal 2013.

The continued reports of abuse and exploitation in these programs continue and warnings in government audits about the vulnerability of temporary migrant workers have not been addressed. Nevertheless, as discussed below, this year's proposed amendment on H-2B is proceeding without even a basic analysis of the labor market implications of the changes or of policy fixes that could improve protections for temporary migrant workers—who are exploitable because they are tied to a single employer and pay thousands in recruitment fees to obtain temporary jobs, and end up earning the same salaries as undocumented immigrant workers who have no rights or labor standards protections. In fact, there's been almost no coverage in the media about the major immigration policy changes that may occur through the 2018 appropriations legislation and no discussion about how to fix the H-2B program.

We estimate the H-2B appropriations amendment would expand the program by 48,000 workers

The language in the proposed H-2B amendment expands the annual numerical limit of H-2B workers to at least 114,000 in two ways. First, it would raise the annual limit (or cap) from 66,000 workers per year to 90,000—an increase of 24,000 workers. Second, the H-2B amendment would exempt H-2B workers from that cap if they are employed in industries which "support the reconstruction or restoration of physical property and infrastructure or debris clean up and removal" in states which declared a major disaster between August 23, 2017 and the date of enactment of the appropriations legislation. The U.S. Department of Labor (DOL) and the Department of Homeland Security (DHS) would be charged with publishing a list of occupational categories that would be exempt from the H-2B annual cap.

The governors of the states where disasters occurred have not asked for additional temporary migrant workers to do clean up and reconstruction, but members of Congress—from North Carolina and Maryland especially—seem to have decided that the states need them.

To estimate the number of visas included in this second part of the amendment, we calculated the number of H-2B jobs certified in fiscal 2017 in the 13 qualifying states in three major H-2B job categories that we believe are almost certain to be listed as jobs that may support the reconstruction effort in disaster states: construction laborers, forest and conservation workers, and landscaping and groundskeeping workers (see Table 1). Because the number of applications for H-2B workers have exceeded the annual cap in the past few years—and demand peaked this year—we estimate that if these visas were exempted from the cap, employers in non-cap-exempt industries (including hospitality and food processing) would apply for many more of the available visas—at least double the amount, accounting for a second set of 24,000 additional visas (see Table 1).

As a result, we estimate the H-2B amendment would grow the program by at least 73 percent to over 48,000 visas—to a total of 114,000—through the combination of raising the cap and exempting certain job categories in the 13 disaster states

We consider this a conservative estimate for two reasons: First, DOL and DHS may include additional occupations to be exempt from the cap beyond the three listed in Table 1. For example, H-2B welders and pipefitters working in shipyards and refineries in Texas and Louisiana could be exempt from the cap, as well as hotel and restaurant workers. Second, the numbers of workers in these categories could increase if more employers who currently do not use the H-2B program become aware of the exemption.

Recent history should serve as a warning to the members of Congress pushing for an H-2B expansion. In the landmark human trafficking case David et al. v. Signal International, LLC—arising from post-Katrina reconstruction work done in Louisiana and Texas—a federal jury awarded $14 million in damages to five H-2B workers from India who were trafficked as part of a group of 500 workers. Congressional hearings highlighted the inability of DOL to enforce labor standards in the H-2B program in a disaster recovery area, which means that history could repeat itself if use of the H-2B program is allowed to increase dramatically in disaster zones.

Conclusion

Before the H-2B program is increased by an appropriations process that ignores the Congressional committees of jurisdiction, it need major reforms to increase transparency, much closer inspection and oversight by government agencies and worker advocates, and major changes that can ensure workplace protections for migrant and U.S. workers. These include access to justice measures so that workers who face retaliation and abuse, and who are threatened with deportation to keep them from complaining to labor standards enforcement agencies, can feel empowered to speak out. Without these important reforms, expanding the H-2B program will degrade wages and working conditions for all workers in major H-2B occupations.

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