IMMIGRATION AS STIMULUS - 10 IDEAS FOR USING MIGRATION POLICY TO JUMP START THE ECONOMY AND CREATE JOBS

Here's an update of an article I wrote a few weeks ago. I've added a few things and incorporated various reader suggestions. Many of you had great ideas on immigration policy generally, but the common denominator must be that the measures directly bring investment in the US economy or directly result in job creation.

10 IDEAS FOR USING IMMIGRATION LAW TO STIMULTATE THE US ECONOMY AND CREATE JOBS

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  who can show a steady source of non-work income, 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 and expand STEM occupations list

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.

F-1 students recently got good news when USCIS enacted a rule permitting practical training to be extended an additional 17 months when they have a degree in a STEM (science, technology, engineering or math) field. Unfortunately, USCIS took a very restrictive reading on which jobs are in STEM fields. The social, behavioral and economic sciences are left out despite the fact that the National Science Foundation includes these occupations in their STEM fields list. And how about including health science graduates? Even if the goal is promote industries other than direct health care, it’s worth noting that many of these graduates work in biotechnology, pharmaceutical and medical device industries which are key export fields for the US.

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. Premium processing should also be available for the I-829 removal of conditions stage.

    b.      Permit concurrent filing of I-526s 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? Maybe more slots for companies that expand in higher than average unemployment areas or in indigent communities.

 

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. Make the time shorter if the jobs are created in an inner city or rural low income area or higher than average unemployment area.

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 the investment is in an inner city or rural low income area or 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 (perhaps a lower threshold like 10 jobs if the jobs are created in an inner city or rural low income area or higher than average unemployment area).

10.     End green card caps for nurses and doctors

Sure the shortage of nurses and doctors is well-documented. But how is this one a stimulus or a job creation measure?  Hospitals cannot expand without an adequate number of nurses and doctors. That’s infrastructure money that isn’t being invested when it could be. And studies show that for every new hospital bed that comes online, jobs are created – as many as three per new bed. There’s also plenty of evidence that a lack of access to health care in poor and rural communities inhibits economic development in those communities. Perhaps add expedited green card processing for nurses and doctors working in medically underserved communities as well as an inner city or rural low income area or higher than average unemployment areas.

Comments

[steve]

You can learn about stimulus jobs at http://www.barackobamajobs.com

[Jenda]

While #5 seems ripe for abuse and some truly egregious market distortions that will end up striking people as terrible, the rest of the proposals seem very near brilliant to me.
Hoenstly, simply selling citizenship at affordable prices after the usual screening requirements are met seems a much cleaner approach, and removes many of the incentives to game the system of narrow interest groups, but your ideas are more likely to be partially adopted than mine.
Kudos.

I agree that a separate visa/green card cathegory for foreign-born graduates of US colleges should be offered fast track to permanent residence, just like in other countries, I think Canada has some program like that.

[borat]

i suggest to extend the 17 months OPT to all grad students irrespective of STEM or not
they're alot of MBA's from ivy league colleges, MFA's from Top notch schools , MA eco/stats etc that are on the top of their league and who'll probably have to leave because of the Visa issue

also to give a fast paced green-card (no country limit) to Ph.D. and other terminal degree holders

my last suggestion is to segregate the work visa between graduates from US universities and workers from outside , the H1B should be used for workers coming from outside and a new category of visa should be made for international graduates from american uni's , it would solve a lot of issues particularly involving the whole "outsourcing" visa issue vs highly trained students from american uni's

[Greg Siskind]

Thanks Young. I've added I-829 premium processing to the section on EB-5s.

[Young]

Regarding a suggestion on EB-5, fast adjudications of I-829s is just as important, if not more important, as fast adjudications of I-529s. Otherwise, I agree that the US govt is not taking advantage of the eb-5 program.

[Greg Siskind]

Thanks Gaston.

[Sen]

As usual all of the ideas are with expansion of immigration. I like the idea of relaxing H1b cap requirements for the employers who are hiring new US employees.But immigration increase should be moderate and certain cases restriction is not a bad idea for healthier and Sustained immigration. Sudden explosion of immigration will create more harm for US people as well as immigrant themselves. Immigration should be aimed at creating new US jobs and should not create any unemployment for US workers. But H1b program combined with outsourcing created siginificant unemployment for US workers and Many US companies went out of business for past 8 years. So there is something wrong in the policy.

[Gaston]

I added a few of this points on a post on my blog:

http://mexicanos-en-usa.blogspot.com/

and directed the traffic to the full article. I hope you don't mind.

[Gaston]

I think this set of ideas are quite in the right track. I agree with you that one of the reasons the US will rebound faster than Europe from this crisis is the flexibility that immigration gives to the economy.

Let's hope there is political will and this issue is resolved soon, millions are literally waiting...

I strongly agree with doing something about green cards for nurses and doctors. So many nursing graduates of US schools, that were born abroad, can not work more than 12 months on OPT after graduating - but nobody realizes, that these 12months you have to spend on everything beginning fro finding an employer,going on orientation so much real working time do you really get? These nurses should be granted green cards right away so the shortage could be minimized. The government seems to not realize that there are perhaps thousands fo nurses like this who could be already working and nursing shortage would not be so big .....

[George Chell]

I thought we had gone through this before. Politically they are not going to do most of these things save perhaps end nursing caps after overworked nurses end up killing a few patients and both the nursing association and the federal government are sued. As a result of inaction, it will be pretty much a jobless recovery until the end of 2010 as jobs are moved abroad..happened in 1993 and 2002 and there is no reason to believe that it wont happen again. As far as the housing market is concerned it is not going to recover without getting the foreigners to buy our houses..there simply aren't enough Americans with the resources to gobble up surplus housing...and China may not fund our debt at the same rate they have done before without the ability to purchase real estate and other property in the US...as my uncle says..poor folks cant be choosers!