Immigration Provision Could Be a Real Win for America

Buried deep on page 899 of the Democrat’s 2468 page reconciliation bill are a number of provisions that, if enacted into law, would represent a seismic shift in American immigration policy and significantly increase the number of foreign workers contributing to the U.S. economy. While the immigration provisions in the reconciliation bill are still imperfect, it could mean more jobs for American workers and more innovation for American consumers.

Under the provisions of the Immigration and Nationality Act of 1990, the federal government caps the number of employment-based green cards at 140,000 per year and prevents any one country from receiving more than 7% of total visas. The low limit on the number of employment-based green cards and per country cap has created a substantial backlog of workers who have pending applications. The State Department estimates that as of November 2020, 3.9 million people were waiting for employment-based visas. In some countries, applicants have been waiting since 2010 for a green card to become current.

Capping green cards and establishing a per country quota is discriminatory, as it penalizes applicants from large countries with a high number of applicants, wasting potential talent.

Recognizing the substantial wait times for U.S. employment-based green cards, other countries have taken steps to encourage the entry of foreign talent. Canada, for example, has implemented a range of pro-foreign talent immigration policies that aim to bring up to one million foreign workers into the country by 2022.

Under the reconciliation proposals, unused green cards would be recaptured for the next fiscal year, certain foreign workers would be exempt from the 140,000 numerical limits if they bear a priority date that is more than 2 years before the date” of application and submit a request for a waiver. While not eliminating the numerical limit and per country quotas that are causing the current backlog, these measures would go a long way to easing the current backlog.

One of the principal benefits foreign workers provide is innovation to the American economy. Studies from the nonpartisan Congressional Budget Office (CBO) have routinely found that “immigrants have also been more likely than native-born Americans to start new businesses.” CBO estimates that immigrants founded one-quarter of all American start-ups. For American consumers, these businesses have allowed them to access everything from autonomous cars to social media sites to advanced medications.

The rate at which foreign-born workers establish start-ups and innovate is particularly critical today because “the rate at which new businesses formed decreased from 10 percent of all firms that existed in 1982 to 8 percent in 2018.” One way to arrest this decline, according to the CBO, is to allow more foreign workers into the United States.

Studies have also shown that foreign workers make substantial tax contributions to local, state, and federal government. The New American Economy has estimated that foreign workers have contributed  $492.4 billion to state, local, and federal taxes. Undoubtedly, these contributions would increase if more foreign workers would be allowed to work in the country. Allowing more foreign workers into the country would also allow local, state, and federal governments to raise more revenue and lower taxes for American families, allowing them to receive more disposable income while also improving services.

Studies also show that immigrants drive economic growth. In 2017, Francine D. Blau, chair of Economics at Cornell, estimated that foreign workers make “the U.S. economy an estimated 11 percent larger each year,” adding about $2 trillion to gross domestic product. Without the contributions of foreign talent, the United States would not only have a smaller economy, but Americans generally would be poorer. 

Foreign workers also possess considerable spending power that ultimately allows them to support American jobs and businesses. For example, the New American Economy estimates that in 2019, foreign workers had a spending power of $1.2 trillion. This spending power was not only used to purchase consumer goods from American businesses, but it also allowed them to support millions of jobs across the economy. Thus, in the long run, denying foreign talent access to the United States only denies American businesses a stable consumer base that will enable long-term growth.

While the proposals outlined in the reconciliation package could go further, they represent the best chance at reforming America’s antiquated immigration system. The outcome of the bill is currently uncertain, but what is widely known is that when foreign workers enter the United States, they provide real economic benefits to consumers, workers, and the overall economy.

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