Today’s news about the EB-5 (immigrant investor) program is that Rep. Mo Brooks (R-Ala.) has introduced an amendment to the Commerce-Justice-Science Appropriations Bill to defund the EB-5 program, on the dual grounds that it is inappropriate to sell a pathway to U.S. citizenship, and that large numbers of Chinese investors have abused the program.
The program had allowed foreign investors to secure a family-sized set of green cards if they help finance Homeland Security-approved but not DHS-guaranteed investments. The minimal amount of the investment had been $500,000 for years; that was increased by the Trump administration to $900,000, but that number was shaved (at least for the time being) by a federal judge in June, back to the $500,000.
Brooks’ proposal – a creative, if long-shot one – is quite different from another problem facing EB-5: that is its congressional authorization ran out on June 30, and has not yet been revived. A federal program needs both funding and authorization to function.
On this issue, and probably no other, the conservative Rep. Brooks stands shoulder to shoulder with ultra-liberal Sen. Dianne Feinstein (D-Calif.); they both want the EB-5 program to die.
Meanwhile, the program’s boosters are whistling past the graveyard as they summon feeble arguments about its future. A blog post this week at eb5investors.com, operated by an EB-5 middleman firm, carries the heading “Mexico’s EB-5 market is primed for growth” and boasts:
The Mexico market is expected to see greater growth in the EB-5 market, industry insiders say. The economic and political conditions make the country ripe for greater interest by Mexican investors in the EB-5 program.
The authors of this are right about one thing: there is room for growth in the Mexican part of the program. They carefully did not offer any statistics on their optimism, and here’s why: visas issued to Mexican investors have never topped one percent of the world total. The program carries a long-established legislative cap of 10,000 visas a year. The State Department shows these EB-5 visas issued in Mexico in three recent years:
Since there are about 2.5 visas per investment, this means that in fiscal year 2020 there were probably about 11 Mexican investments, then worth perhaps $900,000 each, totaling less than $10 million, a tiny droplet, more of a drip, in the multi-trillion-dollar foreign direct investment in the U.S.
The writers are correct that there are some rich Mexicans who are nervous about their country’s leadership and might well want a second passport. But an increase of eleven whole visas (from 2018 to 2019) is hardly a significant sign, and the 2020 data shows an even smaller program.