View from the Left: HR 1044 is – like Trump’s Tax Bill – a Gift to the Haves

By David North on July 10, 2019

As a dyed-in-the wool, life-long, New Deal Democrat, I am equally opposed to the GOP-backed Trump Tax Law as I am to the Democrat-backed HR 1044, the so-called "Fairness for High-Skilled Immigrants Act of 2019", which seeks to damage our nearly 100-year-old tradition of numerically-limited immigration.

The reason: both the tax bill and HR 1044 do exactly the same thing: they bring unneeded additional benefits to the Haves, and provide no benefits to the Have Nots.

As my colleague Jessica Vaughan wrote recently, House Democrats were trying to move ahead the misnamed "Fairness to High Skilled Immigrants Act" on a consensus calendar without hearings or committee votes. The bill would not lift the total number of green cards issued, but it would speed up issuances for people from nations sending us large number of immigrants, notably those from China and from India, the second and fourth largest producers of immigrants. Mexico is first, Cuba is third.

More precisely, currently no more than 7 percent of any category of admissions may go to people from any one nation. The bill would eliminate that ceiling, which has created large backlogs of would-be migrants from China and India, in the employment-based groupings, and raise it to 15 percent in the family-based migration categories.

The bill favors four already lucky groups of Haves while disadvantaging everyone else:

  • the high-tech industries that use the H-1B program to increase their already high profits;
  • the big city (notably Manhattan) real estate developers in the EB-5 program;
  • rich Chinese in the same immigrant investor program; and
  • upper crust Indian nationals in the H-1B program.

The Winners and What They Win

Big Tech wins because it will allow a large number of Indian nationals who are now on their payrolls as H-1B temporary workers to get green cards; this will dampen down some of the unrest currently in H-1B ranks as Indian and Chinese aliens with these visas have chafed at the length of time to the green card. There are at least some reports that some H-1Bs have moved on to Canada and other nations with shorter waiting periods.

Big City Developers win because the new law would, similarly, soothe the anxieties of would be Chinese investors (who get a family-sized set of green cards for their half-million dollar investment) and allow the users of the EB-5 program to continue to raise most of their money in China, as opposed to having to set up EB-5 attracting programs in other parts of the globe.

Rich Chinese seeking visas in the EB-5 program would be big winners, as they would get their green cards much sooner, and in many cases avoid the problem of their older children "aging out" of the program, as they reach their 21st birthday.

Upper Crust Indians, i.e., those with enough money to get a college degree, either there or here (with the system tilting toward those with U.S. masters' degrees) would, similarly, have less waiting time in the H-1B status to the issuance of green cards. Within the large class of Indians in the H-1B program, those favored by this law are those also well-regarded by their employers, otherwise they would not have filed for the green cards, so it is not all H-1Bs who are getting a break, it is those that employers favor. (There are no such complications in the EB-5 program, all EB-5 visa holders from a given nation are treated the same.)

Partial Winners and Partial Losers

Would be family immigrants. The Declaration of Independence states that all men are created equal; HR 1044 has a more nuanced view of would-be immigrants, they fall into three categories:

  • fully favored: employment-based, would be migrants from China and India, and a handful of Vietnamese investors;
  • partially favored: family-based would-be migrants from Mexico and the Philippines;
  • never favored: all other would-be migrants from all over the world.

Largely overlooked is a distinction in the bill between the elimination of the country of origin ceiling of 7 percent for the employment-based categories, and the substitution of 15 percent for 7 percent among the family-based migrants. This means that the Indians and the Chinese go to the head of the line, squeezing out others, in the EB-categories, but there is only a partial similar benefit for the backlogged folk from Mexico and the Philippines (some of whom are now waiting for 24 years for the visas set aside for the married sons and daughters of U.S. citizens.)

It doesn’t say so in so many words, or in neon lights, but HR 1044 says in effect: Chinese, Indians and a few Vietnamese are more important than Mexican Nationals and Filipinos, and all six groups are superior to all other would-be immigrants. How any member of the Hispanic Caucus could vote for such a bill – casting a group of Mexican Nationals as second-class non-citizens, puzzles me.

HR 1044's provisions reminds me of the old country-of-origin system we had in place prior to 1964, except that the old system tilted sharply against Asia (and for Mexico) while the new one does exactly the reverse.

The Total Losers, and What they Lose

American Workers. Any program change that strengthens the H-1B program, which has close to a million semi-indentured workers in it, means that fewer citizens and green card holders are hired in these reasonably well-paying jobs.

American Investors. The principal use of EB-5 funds is to provide what is known in the trade as "mezzanine financing", that is loans without liens, to big city real estate developers; routinely EB-5 investors get 1 or at most 2 percent for their money, while the market rate is as high as 10 percent. So U.S. investors are being shunned in favor of EB-5 ones.

I must say that this is not a population to spend many tears on; these are passive investors who probably do not know that they are being discriminated against as they have many other investment opportunities. Though I have been writing about EB-5 for years, it did not dawn on me until recently that this was a group hurt by the program; it certainly is not an organized group.

Would-be immigrants from the rest of the world. Generally, for every HR-1044-favored would-be migrant who would get a visa faster there is a non-favored would-be migrant who will have to wait much longer than previously. These are in both employment-based and in family-based migrant categories, so if you are an Argentinian, a Belizean, a Canadian or a Dane, or an Estonian or a Fijian, and you have a green card visa waiting for you, HR-1044 will set back your dreams for years.

Suggestion

Instead of either expanding the number of these visas, or juggling them in the HR-1044 fashion, we should simply stop issuing new backlog-creating visas until the backlogs have dissipated. This would not reduce overall immigration – a useful goal, to be sure – but it would, over a decade, reduce the backlogs considerably.

In addition – because some on the backlog lists have lost interest in coming here -- we could further shorten the lists by offering those on them $500 or $1,000 to get out of the queue.