Bound to the Soil

Does anyone else have the problems that I do with the “place-based visas” that John Lettieri proposes in his op-ed in the Washington Post?

Immigrants — skilled immigrants, in particular — bring an array of benefits to declining communities. They fill empty housing stock, reduce crime rates and spur new business creation. Where there is a shrinking tax base, they bring fiscal stability for schools and first responders. Where there is a dwindling local workforce, immigrants enable employers to expand. Many struggling cities have underused assets and infrastructure built for much larger populations; new immigrants activate such latent capacity.

We shouldn’t be surprised. Immigrants have long been a key ingredient in the most vibrant areas of the country. The problem is that our skilled immigration policy fails on two fronts: It welcomes too few workers, and it primarily serves to strengthen already successful and fast-growing areas of the country by tying a visa to a single employer. As a result, the areas that could most benefit from an infusion of skilled immigrants are the least likely to be served by current policy.

This is a policy choice. What if we chose differently?

The idea of “place-based” — rather than employer-based — visas has been already implemented in countries such as Canada and Australia. Recently, the Economic Innovation Group released a paper calling for a specific place-based visa program — a “heartland visa” — aimed directly at helping struggling regions break the economic and demographic declines they are experiencing. Such a program would open a new door — without reducing the slots available through other programs — for skilled workers who could meet a range of local needs, from helping grow a local robotics hub, to filling small-town physician shortages. But instead of relying on employer sponsorship, heartland visas would be tied to communities — ones that qualify based on a stagnant or shrinking local workforce, or other economic criteria. The draw could be considerable. Many demographically stagnant U.S. communities offer an enormously attractive chance for a better life for would-be immigrants.

To participate in the program, eligible communities would be required to opt in and commit resources — perhaps matched by federal dollars — to implement the program and assimilate new arrivals. Welcoming communities would rally to attract human capital much as they do for a new corporate headquarters — by showcasing their local amenities, quality of life, job opportunities and growth potential.

Visa holders, in turn, would commit to settle in an eligible community for a set period — say, three years — in exchange for being fast-tracked for a green card and permanent status. They would have a wide array of choices for where to settle and full job mobility within their chosen labor market. While some visa holders would eventually relocate, many would put down permanent roots. Over time, areas that find success implementing this program would see their populations rise and prosper.

Under the present system people who come from other countries on H-1B visas are in effect captives of the companies that sponsored them. Increasingly these sponsors are outsourcing companies who, using the power they have over those they’ve sponsored, keep their wages low. Those low wages in turn keep the wages for native-born workers with whom they compete low. It is one of the reasons for very slow wage growth in recent years.

Under Mr. Lettieri’s proposal another group of people from other countries would quite literally be “bound to the soil”, as they used to say about serfs in medieval Europe. If the companies for which they worked relocate and there are no other jobs in the areas to which they are committed, would they be returned to their countries of origin? If not, what would the commitment contracts mean?

I see that proposal as contrary to American practice and traditions, difficult to administer, and inevitably gamed.

I agree with him that there is a problem but my solution to it would be quite different: stop subsidizing cities. An enormous number of federal programs effectively subsidize cities, everything from the home mortgage interest deduction to the Federal Highway Trust Fund. Here in Illinois our real estate tax formula is essentially a subsidy to downtown Chicago at the expense of non-downtown Chicago and the adjacent suburbs.