Now Is the Perfect Time to Downsize the OPT Program

And to limit it to the truly talented among graduating foreign students

By David North on May 26, 2020

Now is the perfect time to downsize — sharply — the Optional Practical Training program.

This is the program that rewards employers for hiring foreign college grads with an 8 percent discount, a discount the employer could not get if he hired an American college grad. OPT runs for one year for all foreign grads of all American institutions (of whatever level of merit) and an additional two years for a large portion of the alien alumni who have a degree in the fields of science, technology, engineering, or math (STEM).

The discounts are made available by eliminating the usual payroll taxes, which support America's embattled Social Security, Medicare, and Federal-State Unemployment Insurance trust Funds — so America's aging, disabled, sick, and unemployed are forced to subsidize (usually for-profit) employers who prefer alien workers to American ones. That is a truly bizarre arrangement, but one rarely reported by the media.

The upside of this odd program is that Congress never had anything to do with it; it was created out of whole cloth by the Bush administration, expanded by the Obama administration, and protected, so far, by the Trump administration. It can be wiped out, or changed, with a stroke of the pen.

So when some 30 to 40 million Americans are out of work, should our elderly and sick be asked to pay employers to discriminate against U.S. workers? Should this program continue when the American members of the class of 2020 are having a perfectly terrible time landing jobs? I think not.

Rather than wiping it out completely, an action that would have political risks, I propose both a transition period and a long-term shrinking of it that will guarantee jobs for the truly talented among graduating foreign students. I also propose to end the subsidies. The best and the brightest of the alien grads will still get to work in the United States for the one- or three-year periods, the trust funds will no longer subsidize the whole operation, and some 150,000 new jobs will be opened for American citizens and green-card holders. Here are the proposed new terms for the OPT program.

Transition. Aliens currently in the program for the first one year can finish their tours of (subsidized) work under the current rules; in many cases this is just a matter of weeks or months, at the most. Aliens currently in the STEM extension period can continue their work, but only if their employer agrees to pay $350 a month into the trust funds. These OPT-STEM workers will have to pay the same amount.

Rules for the New Program. In order to secure a new one-year visa, or to secure the two-year STEM extension, an alien applicant must be in the top quarter of his or her class and have that degree from one of 100 highest-ranking U.S. educational institutions chosen in a totally non-partisan way. This would shave the number of aliens eligible for OPT each year down to the scores of thousands, from the current level of about 200,000. No alien could use more than three years of OPT eligibility.

The list of 100 might be taken, for example, from the US News and World Report most recent ranking of national universities, or from some other peer-reviewed listing.

Comments. Currently any degree from any U.S. institution of higher education, ranging from Harvard and Stanford to the least of the visa mills, can be used to secure the subsidized OPT status. In many cases the foreign workers have two-year (or 18-months) master's degrees. Further, currently one can take a series of master's degrees from the most obscure of institutions, and remain in the OPT program for decades on end.

These proposed new rules would be opposed by both Big Business and Big Education, because they would  reduce the number of foreign students for the universities, as well as reduce the supply of subsidized labor for corporations. Further, as far as many employers are concerned, such changes would eliminate a handy, short-term visa for their future H-1B employees. But with 30 to 40 million U.S. workers out of work, how can we continue to subsidize the hiring of foreign college grads?

These changes, as noted earlier, do not require any action by Congress; the Department of Homeland Security can simply issue a new set of regulations, perhaps with a nudge from the White House.