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9 IDEAS FOR USING IMMIGRATION TO STIMULATE THE US ECONOMY

By Greg Siskind

Anti-immigrants love recessions because they can whip up fears of foreigners coming to the US and stealing American jobs. But pro-immigration advocates can just as easily make the case that immigrants are job generators for Americans. And immigration can do even more to help the economy than is the case under the current system. Here are ideas for changing immigration law to attract needed capital into American businesses and enable employers to hire more American workers. Some of these are changes that can be made by a government agency while others would require legislative changes.

1.       Create a retiree visa

 

What if we could find people to immigrate to the US who are well off financially who want to spend money in the US and who have no desire now (or likely in the future) to try and find employment in the US? We can. They?re retirees and they?ve been coming to the US for years. But many are reluctant to buy vacation or retirement properties because they only get 90 or 180 day stays when they come over and have to deal with convincing a CBP officer that they have strong ties abroad and are going home after each trip.

 

Why not create a retiree visa that would be limited to people over fifty-five who can show a steady source of non-work income, that they have their own health insurance and they own a residence in the US without a mortgage?

 

 

2.       Create a new medical visitor visa

 

You may not have heard of medical tourism, but it is a very important new trend in global health care. People are more and more frequently traveling outside their own countries for health care.  A lot of Americans are looking to go abroad for procedures, particularly the uninsured, because of big cost differences.  And a lot of wealthy foreign nationals are coming to the US because we have cutting edge treatments with some of the best doctors in the world. Creating a separate tourist visa for people who have the financial means to pay for their US treatment will give a boost to American hospitals and having foreign nationals able to pay the full bill for their care helps to underwrite Americans who don?t qualify for government funded care, but are not well off enough to pay 100% of their medical bills.

 

 

3.       Make F-1s dual intent

 

When a student applies for an F-1 visa, the student must demonstrate that he or she has no intention to immigrate. But it?s pretty hard for someone to prove this when they?re coming over for a program that lasts several years.

 

Making F-1 visas a dual intent category and not denying entry on the basis of a lack of ties to the home country will help in two very important ways. First, foreign students very often receive no financial aid and are, in effect, subsidizing American students unable to afford higher education without some outside help.

 

Second, a great number of American universities have been unable to find enough American students to fill slots in graduate programs, particularly in the STEM fields ? science, technology, engineering and math. Those foreign students often make it possible for a university to keep a department going that otherwise might not survive and thrive without them here. And that means American graduate students have MORE opportunities. International students also help ensure that America?s place as the premiere country for research is maintained.

 

4.       Improve the EB-5 immigrant investor program

It?s a real shame that only a few hundred of the ten thousand immigrant investors available each year end up getting used. Congress created this green card category in 1990 and the idea was to help American businesses attract foreign capital and also to create plenty of jobs for American workers. EB-5 immigrant investors who invest $1,000,000 and create ten jobs through their investment are supposed to get a green card in exchange for their helping the country.

Most countries in the developing world have an immigrant investor program, but the one in the US is, unfortunately, pretty unpopular. Why? A lot has to do with USCIS? well-documented hostility to the program over the years.

It?s time for the our government to realize that this program is important to the country and making it difficult for immigrant investors to use the program costs Americans jobs and prevents American businesses from getting capital at a time when they could really use the help.

Here are some possible changes that would inject some life in to the EB-5 program:

a.       Mandate premium processing ? There is no reason why it should take USCIS seven months to process an I-526 application and then another four to six months for the State Department to deal with the consular processing or two more years if the applicant chooses to adjust status (not kidding). If an applicant can afford the investment required for the EB-5, surely USCIS and DOS can come up with fee amounts that will enable the two agencies to be able to provide speedy, high quality service. In fact, the higher fees will enable USCIS to hire more people, thus making the EB-5 program a job creation visa in a new way.

 

b.      Permit concurrent filing of I-360s and I-485s ? The adjustment of status process in California is taking 27 months according to the latest California Service Center processing time report on top of the 7 months for the I-526. 27 months is a travesty, but at least allow concurrent filing as is the case with other employment-based green card categories.

 

c.       Allow EB-5s for those providing loans to American companies and not just those taking equity investments ? USCIS has been a real stickler over the years in terms of restricting the types of investments that work for the EB-5 program. Loans are barred under the EB-5 rules even if the loan results in tangible job creation. This seems pretty dumb when we?re in the middle of one of the tightest credit markets in a century and businesses are failing every day because they can?t get loans. The federal government is LOANING money to businesses to help save jobs. Yet USCIS acts like an investor is somehow being sneaky when an investment is structured as debt rather than equity. A loan can save a distressed business and result in job creation just like an equity investment.

 

d.      Allow constructions jobs to count ? USCIS will not count full time directly created jobs in construction in determining if ten full time jobs have resulted from the investment. Do construction workers somehow not count as real workers?  Count ?em.

 

 

5.       Bonus H-1Bs for employers that have expanded their US work force

 

Sure, we can get in to another argument over H-1Bs and get in to the age old arguments over how protectionist we should be when it comes to insulating the American labor market. But let?s put that aside for the moment and think about places where there might be some room for agreement.

 

Today I read about one of the country?s biggest banks laying off 35,000 workers. How about rewarding companies that expand the number of American workers on their payroll with bonus H-1Bs? Maybe something along the lines of a formula where for every four or five workers a company?s work force grows, they get a cap exempt H-1B slot?

 

6.       Eliminate the H-1B cap for occupations with less than 4% unemployment

 

Why 4%? That?s a figure economists often consider to be ?full? employment where workers have a relatively easy time finding employment and rates below this figure have an inflationary effect. If an employer can demonstrate it is filling jobs with H-1B workers in an occupation with full employment, then there should be little concern about displacing American workers. And jobs for Americans in the industry are saved because employer unable to find needed workers frequently shut down their US operations and move abroad, causing American and non-immigrant workers alike to lose their jobs.

 

7.       E-2s ? scrap the requirement that investing happen prior to the issuance of the E-2 visa and replace it with a probationary E-2 for a year that can be extended if the investor has begun investing funds.

The E-2 visa is available to investors investing ?substantial? funds in a commercial enterprise in the US. When I explain to someone thinking about setting up a business in the US and getting an E-2 visa, they are often perplexed when I explain that they have to be actively in the process of investing a substantial amount of money and only after their money is sunk in the business will a consular officer approve the visa. Huh? You sink a fortune in to a business and then the consulate turns you down for the visa. Now that?s attractive. Not!

While there is a legitimate concern with people being granted an E-2 visa and then not really going through with the investment, there is an alternative approach that could be tried. How about only approving the initial E-2 visa for a new investment for a year if the investor has not already invested substantially in the US business? We already do something similar with L-1 visas where USCIS will typically grant a one year approval for a new office in the US.

 

8.       Create a green card category for E-2 investors if they have maintained the investment for five years and have created jobs for 10 workers

 

One of the gaps in our immigration system is that people can get an E-2 visa, create lots of jobs and invest lots of money, but they may never be able to get permanent residency. How about rewarding people who have invested for many years and created many jobs with permanent residency? Perhaps allow conversion after a person has invested for ten years and created ten jobs.

 

 

9.       Create a new non-immigrant category  for investors

Somewhat related to the above idea is the possibility of creating another investor immigration program. This one would have the following elements:      

a.       Unlike the E visa categories, this one would not be based on being a national of a qualifying treaty country.

b.      Applicants would need to make a $250,000 initial investment ($200,000 if investment in higher than average unemployment area)

c.       Four jobs created must be created as a result of the investment (which must be shown before the visa is extended)

d.      The visa would be approved for a period of three years

e.      Holders of the visa can get extensions, but only with an additional $250,000 each time the extension is requested and only with a demonstration before each extension that the prior investment resulted in the required job creation).

f.        The investor can apply for a green card any time after the investor can document that 12 jobs have been created as a result of the investment.

Do you have an idea to add to the list? Hate these suggestions? Feel free to chime in.

Full post as published by Greg Siskind's Blog on December 12, 2008 (boomark / email).