• With: Joe Rago, Jason Riley, Dan Henninger, Kim Strassel, James Freeman, Matt Kaminski, Bret Stephens

    This is a rush transcript from "Journal Editorial Report," April 28, 2012. This copy may not be in its final form and may be updated.

    PAUL GIGOT, HOST: This week on the "Journal Editorial Report," the Supreme Court once again finds itself in the middle of an election-year battle. This time, over immigration. Will the Arizona law stand?

    Plus, the president pushes lower interest rates for federal student loans. Mitt Romney and some Republicans in Congress agree. Is it a good idea?

    And Sarkozy's last stand. With an economy in shambles, the French president faces an up-hill battle for re-election. Will France jump off the socialist cliff? And are there lessons for the United States?

    Welcome to the "Journal Editorial Report." I'm Paul Gigot.

    The Supreme Court waded into another controversial election-year issue this week, hearing oral arguments on Arizona's immigration law. The Obama Justice Department sued Arizona over that 2010 law, arguing that Governor Jan Brewer violated the Constitution's Supremacy Clause by requiring local police to enforce federal immigration statutes. So are the justice's buying the administration's argument?

    Joining the panel this week, Wall Street Journal columnist and deputy editor, Dan Henninger; Political Diary editor, Jason Riley; and editorial board member, Joe Rago.

    Joe, this is a case about federal versus state power. The Supreme Court this week, both liberal and conservative justices, did not seem very sympathetic to the federal government's argument.

    JOE RAGO, EDITORIAL BOARD MEMBER: No, they didn't, because Arizona very carefully crafted the state law to fit into the federal law. So really, all they're doing is saying, look, if the police happen to pick up somebody, maybe they need to verify their legal status, that's part of federal immigration law. So --

    (CROSSTALK)

    GIGOT: The state is saying we're just going to enforce the law. We're supplementing what you do. What about the provision of the law, the Arizona law that says, look, if you're illegal, it is a crime. If you're illegally here, it's a crime to go look for work. That, in the oral arguments of the Supreme Court, seemed to be the part of the law most in jeopardy.

    RAGO: I think so. And that's definitely the part that's most out there.

    GIGOT: In terms of maybe exceeding the federal statute?

    RAGO: Exactly.

    GIGOT: All right. What was the argument that Arizona used that said that was fine?

    RAGO: Well, what they said was, it's already a crime to be an illegal immigrant, so we're supplementing that.

    GIGOT: By saying, if you look for work, it's another statute. It's another crime.

    Jason, why -- if the Justice Department may lose here, 8-0, it's possible.

    (LAUGHTER)

    We don't know for sure, but it could. Why would they have advanced this argument?

    JASON RILEY, EDITOR, POLITICAL DIARY: I think they did it for political reasons, Paul. This is about the Hispanic vote, showing that they care. The Justice Department did not need to bring this case. Other groups, civil rights groups and so forth were suing. They could have let those cases run their course. The Obama administration wanted to jump in here.

    It doesn't look like the vote will be close, Paul. It looks like parts of the law will be upheld. But when a liberal justice like Sonya Sotomayor is skeptical of the government's case, you know the Obama administration --

    (CROSSTALK)

    GIGOT: What about the case that it's racial profiling. This was not argued in the course, because even the government isn't making that case, but a lot of outside groups have been saying that that's what this is, and therefore, that's a violation of the law. Is that even at issue here?

    RILEY: Well, I believe that the law specifically bans that practice. And Chief Justice Roberts made that clear during the oral arguments. There's no racial profiling. You're not alleging that, right? The government said, no, we're the not.

    GIGOT: Dan, explain the politics. If you lose 8-0 at the Supreme Court, that doesn't strike me as good politics.

    HENNINGER: I think that the Obama White House and Democrats reached the point where it doesn't matter to them all that much whether the Supreme Court rules against them 8-0 on this. They still take away the issue of Republicans and Mitt Romney being anti-Hispanic. And I don't think the voting block is going to be paying really close attention to the federalism issues at the center of this case. They're going to be able to run against the Republicans and Arizona -- the right will at least get the law -- as being anti-Hispanic. And it's purely a political play.

    The interesting thing is you have to ask yourself, as Jason was suggesting, why did they bring such a loser case to the Supreme Court. Are they now enlisting the Supreme Court itself in their political strategy?

    GIGOT: I should add there would be only eight -- there are only eight justices sitting on this case because Elena Kagan has recused herself because she was at the Justice Department when this was being formulated.

    Let's talk about the trends in immigration, on where this law is really needed.

    RILEY: right. Because there are two issues here, whether this is constitutional and whether efforts like this are effective in reducing illegal immigration, which is the goal here. That's what we all want. And the jury is still out on that -- on that. There's a law that --

    (CROSSTALK)

    RILEY: -- five other states, at least five other states, have passed Arizona-type laws. Some have walked them back a little bit. The business community doesn't like them. Law enforcement isn't crazy about them being deputized. They say it makes it more difficult for them to police their communities, do their day jobs. People are afraid of them, think they are deportation agents and so forth.

    So, we have to ask ourselves whether the laws work or whether there's another way to go in terms of determining how much foreign labor we should allow in the country.

    GIGOT: But the big story on immigration is not this enforcement. It's the fact that illegal immigration is collapsing. It's falling dramatically from Mexico. And it has -- according to a Pew Foundation survey this week showed that it's really, really --

    RILEY: Net zero.

    GIGOT: -- net zero.

    (CROSSTALK)

    RILEY: The amazing thing about this is that trend began in 2000. That trend preceded this whole uproar we've been having over the last decade about --