The Establishment Hides Subsidies for Employers Hiring Alien Grads (cont.)

By David North on May 22, 2018

In an earlier posting, I asked rhetorically how the Wall Street Journal could run an otherwise accurate article about the Optional Training Program (OPT) without mentioning the massive federal subsidy to employers for hiring former foreign students instead of Americans or green card holders.

OPT excuses both employers of recent alien college grads and the aliens themselves from the normal payroll taxes of about 8.25 percent when an alien college grad is hired rather than an American one. This odd incentive costs three federal trust funds (for Social Security, Medicare, and Unemployment Insurance) a total of at least $2 billion a year. U.S. citizens and green card holders, and their employers, are not eligible for this subsidy because they are required to pay payroll taxes.

The period of subsidy for these alien workers runs for up to three years for about two-thirds of the grads in OPT — those with degrees in one of the STEM fields (science, technology, engineering, and math). The remaining third, with degrees in other fields, get a single year's subsidy and a one-year long work permit.

A partial answer to my question — which does not exonerate the Journal — is that the Pew Research Center study of OPT that the article is based on, full of footnotes and tables and much longer than the Journal article, also failed to mention the unusual federal subsidy. (My colleague Preston Huennekens searched the Pew Research Center report and found no instances of the words "payroll", "pay roll", "tax", or "subsidy".)

There certainly is an obligation for a reporter to know enough about a subject that she can see through an incomplete study, such as this one.

But there is an even greater obligation for researchers and their high-prestige employer — in this case, the Pew Research Center — to discuss all of the major pertinent facts about an issue.

And this may be old-fashioned of me, but I think that $2 billion taken from our elderly to essentially bribe U.S. employers not to hire citizens ... well, that is worthy of note.