published 2019-05-08 17:23:27 by Neil Munro
The White House’s draft immigration plan includes valuable border security reforms, but it also shifts the migrant inflow from blue-collar jobs towards white-collar college jobs, so sharpening workplace competition for a wide range of American graduates.
The bill would neither increase nor reduce total legal immigration, now at roughly 1.1 million per year. But it would reallocate green cards for family chain-migrants — such as immigrants’ parents, adult children, and siblings – towards “merit-based” slots for migrants with the job skills most sought by U.S. employers.
“What we’re doing in this plan is we’re working on keeping the number the same,” a senior White House official said Tuesday. “We’re just changing the composition.”
“We’ve been playing around with it to figure out how you build something that really works for America,” the official said, according to Politico. “The number one goal in that is to make sure that we’re not bringing in low-skilled labor.”
The proposed deal is being cautiously supported by the Federation of American Immigration Reform. Politico reported:
“The American people expect a plan that addresses chaos at the border and moves the nation to an immigration model that emphasizes skills over bloodlines,” said RJ Hauman, government relations director at FAIR, who has been in touch with the White House. “Jared Kushner and his team understand this and we’re encouraged by what we’ve heard this week.”
However, any shift from blue-collar migration to white-collar migration will increase job competition for American graduates, said Mark Krikorian, the director of the Center for Immigration Studies.
The plan, if it goes into effect, would lessen the pressure on blue-collar workers, but it would almost certainly up the wage pressure on middle-class white collars, because they’re talking about admitting hundreds of thousands of higher skilled [graduates] every year … There will be lots and lots more graduates from universities in India and China and Nigeria who are going be directly competing with young people from the suburbs of Washington D.C. … and Atlantia and Chicago and L.A.
In 2018, many GOP candidates lost when upper-income suburbanites switched to Democrats.
The sketchy outlines of the bill suggest it will boost the annual award of green cards directly to graduates from roughly 50,000 to at least 250,000, on top of the family migrants who hold college degrees, he said.
Right now in L.A., for instance, immigration is now skewed pretty heavily towards less-skilled workers. But the emphasis will shift and there will be a lot more competition for 21-year-old [American] college graduates trying to get a job. The competition also may be greater for [older] mid-career graduates because young Americans are relatively cheap to employers. A middle-aged white-collar American graduate is much more expensive to employers than a desperate young graduate of a college in Bangalore, India.
Another concern is that unreleased details in the bill may turbocharge the inflow of foreign graduates into U.S. jobs via the various temporary, non-immigrant work-permit programs, he said, adding:
If the new system were to give [migrants some] points for having already worked in the United States, that would create an enormous incentive to come in here on some kind of temporary [work permit] and work here to get [green card] points. It would perpetuate the indentured servitude element of many of our guest-worker programs.
“That’s speculation,” he added.
Currently, at least 500,000 foreign graduates are using temporary work permits to work U.S. jobs, often at very low wages. Their goal is to use the jobs to get green cards from the federal government, usually via the H-1B visa program.
FBI busts company which allegedly helped get ‘Optional Practical Training’ work permits via fraud for roughly 1,900 Chinese grads, to steal jobs & salaries from American grads. More to come, despite media silence on white-collar job theft #HR1044 https://t.co/VsSjAVsXNi
— Neil Munro (@NeilMunroDC) April 15, 2019
Nationwide, at least 1.5 million non-immigrant foreign graduates are using temporary permits to work in U.S. jobs.
That population helps reduce wages for American graduates because it is twice the yearly college output of American graduates with degrees in healthcare, business, science, engineering, software, architecture, and design careers. In addition, employers have won green cards for roughly 50,000 graduates each year for more than 20 years.
This huge population of salary-cutting foreign graduates is rarely noted by establishment media. But it pushes American graduates towards the Democratic Party, says a 2018 study by pro-migration authors:
Our strongest and most significant finding is that an increase in high-skilled immigrants as a share of the local population is associated with a strong and significant decrease in the vote share for the Republican Party. To the contrary, an increase in the low-skilled immigrant share of the population is associated with a strong and significant increase in Republican votes. These effects are common to presidential, House and Senate elections.
The blue-collar political shift to the GOP caused by low-skill immigration, however, is more than offset by the rising number of pro-Democratic immigrant voters who have turned California blue and now threaten to end GOP dominance in Texas.
White House officials say the draft plan will protect Americans’ wages. “The official said it would cumulatively increase wages in the U.S.,” Politico reported.
“We have a lot of objectives … Number one, [Trump] wants to protect American wages,” White House senior counselor Jared Kushner said April 23.
But almost any immigration program will increase the cumulative total of wages by adding more workers — even if each employee also sees a wage loss via job competition. That combination of immigration and job-competition annually transfers roughly $500 billion from Americans’ salaries and wages to investors, according to George Borjas, a Harvard economist.
When businesses have to compete for workers, they raise wages and improve working conditions. This is finally happening for American workers for the first time in ages. Importing a flood of cheap foreign labor on more H-2B visas threatens that growth. https://t.co/krVX1b2ZNn
— Tom Cotton (@SenTomCotton) May 7, 2019
Importantly, the plan does not provide the extra supply of workers, consumers, and renters which is loudly sought by CEOs and investors who are eager to cut costs and boost revenues. In his April comments about the plan, Kushner noted the many non-migration ways in which Trump has aided business:
We freed up companies to be able to invest capital, which is creating jobs — we’ve lowered the corporate tax rate and we’ve given a tax cut to individuals, which means there is more consumption. We’re working on trade deals … We’ve figured how to make our country energy independent. We’ve increased the amount of energy we are creating which geopolitically is very important. We’re investing in the industries of the future — Artificial Intelligence, 5G, quantum computing– a lot of things that allow us to be long-term competitive. And then also appointing a lot of conservative judges has allowed us and a lot of businesses to have certainty on what the law is, and so those things, if you couple them with maybe infrastructure [spending] and then immigration reform, I think that will keep out country competitive for the long run.
Krikorian is skeptical about the political value of the plan:
It does not make sense to me to be addressing this issue at all before the election. The [political] energy is at the border, and as I understand it, the legislation has lots of very strong and important border-control measures. That’s good, but there’s no reason those kinds of measures should not be packed into one bill on its own … I’m afraid they will make the same mistake in 2013 and 2007, and I think there has to be a comprehensive approach to this issue. How is any of this going to make it more likely that  voters in Pennsylvania and Michigan will show up and vote for Trump?
The plan “is clearly undermining the President’s image among a lot of these Reagan Democrats who voted for them as the champion of the American worker,” he said, adding “How does any of this promote ‘Hire American’?”
Each year, roughly four million young Americans join the workforce after graduating from high school or university.
But the federal government then imports about 1.1 million legal immigrants and refreshes a resident population of roughly 1.5 million white-collar visa workers — including roughly one million H-1B workers — and approximately 500,000 blue-collar visa workers.
The government also prints out more than one million work permits for foreigners, tolerates about eight million illegal workers, and does not punish companies for employing the hundreds of thousands of illegal migrants who sneak across the border or overstay their legal visas.
This policy of inflating the labor supply boosts economic growth for investors because it ensures that employers do not have to compete for American workers by offering higher wages and better working conditions.
This policy of flooding the market with cheap foreign white-collar graduates and blue-collar labor shifts enormous wealth from young employees towards older investors even as it also widens wealth gaps, reduces high-tech investment, increases state and local tax burdens, and hurts children’s schools and college educations. It also pushes Americans away from high-tech careers and sidelines millions of marginalized Americans, including many who are now struggling with fentanyl addictions. The labor policy also moves business investment from the heartland to the coasts, explodes rents, shrivels real estate values in the Midwest and rewards investors for creating low tech, labor-intensive workplaces.
Goldman Sachs says Trump’s tight labor-market policy (AKA ‘Hire American’) gave 4% raise to blue-collar/middle-class in 2018. But upper-income graduate salaries lagged – maybe b/c of 1.5 million visa-worker graduates who work for spaghettiOs & green cards https://t.co/g6jtv9BS81
— Neil Munro (@NeilMunroDC) March 14, 2019