Wednesday, January 30, 2013

Unintended consequences

I normally agree with pro-immigration stands, but this one strikes me as likely to do something different than expected:

While I think the region-based visa would be a positive step by itself, there is an additional twist I would recommend adding to the policy: require the purchase of a home from the visa recipient. This would be similar to the EB-5 program, which gives green cards to rich foreigners who invest in the U.S. This would allow non-rich immigrants to make an investment in the region sponsoring their visa. Not only does this increase the political popularity of the program and provide a way to transfer some of the gains of immigration to the native born population, but it also serves as an enforcement mechanism. Workers are less likely to leave the region their visa ties them too if they have made a large investment in that area which they cannot sell for the length of their visa.
I love the idea of a regional (i.e. state level) work VISA.  But the house thing is a terrible idea.  First of all, how do you get a loan?  If the requirement is "cash on the barrelhead" then we are only opening the market up to wealthy immigrants.  High skilled people just starting out are squeezed out of the market.  Or you get an asset, with little money down bought by people with a weak understanding of the local market who have the ability to flee overseas if things collapse. 

Nor am I sure we want even more price support for housing in the United States (mortgage deductions already support prices).  And I doubt that, in world with sublets, that this would really help keep people local over and above the what we already have in place. 

Plus, the rich enforcement mechanisms we have for work VISAs are already pretty scary, without adding this new level

1 comment:

  1. They may not be able to sell their home but they can certainly rent it out and go rent elsewhere. They had ties in their own country but that didn't stop them moving elsewhere. And if they came to America illegally then they are not going to be adverse to lower level fraud.

    And imagine the bureaucracy involved in checking out all the family permutations and complications in judging whether the family/green card holder actually lives at the house.