Business & Economics

Coming to America: Finally Fixing Legal Immigration

A Biden win opens window for expansion of legal immigration

Image Credit: US Citizenship and Immigration Services

Elections have consequences, and one of the biggest changes likely to emerge from the Nov. 3 vote for president is a sharp change in US immigration policy. During the campaign, Joe Biden staked out a pro-immigration platform that contrasted starkly with the rhetoric and record of incumbent Donald Trump. With the election of a divided Congress, the challenge ahead will be to forge a new policy approach that expands prosperity for Americans as well as for the immigrants who join us.

Mercatus Center research has consistently shown that immigration has been a benefit to the United States. In fact, it is one of America’s great advantages in the world today. Immigrants keep our nation demographically young compared to other nations. They fuel growth in our economy by starting businesses, inventing new products and powering the expansion of US producers, from farms to Silicon Valley. They also enliven our culture and deepen our commercial connections with the rest of the world.

In recent decades, up to this pandemic year, America welcomed an average of about 1 million permanent legal residents a year—by far the most immigrants of any nation in the world. Yet the US immigration system is more restrictive than it should be, and in ways that are unnecessarily discriminatory and harmful to our national self-interest.

The most promising plank in the Biden immigration platform is its call for more legal immigration, in particular high-skilled temporary visas (primarily the H-1B) and permanent, employment-based green cards. Higher-skilled immigrants—those with college degrees and especially graduate degrees in science, technology, engineering and math (STEM)—are close to a pure blessing to the United States. They are more likely to earn higher wages, found high-tech start-ups and file patents than native-born American workers. Foreign-born workers also play a vital role in the US healthcare system, including its response to the COVID-19 pandemic.

High-skilled immigrants also pay more taxes over their lifetimes than they consume in government benefits—half a million dollars more for those with a four-year degree, nearly a million dollars more for those with a graduate degree. The positive impact of high-skilled immigrants on government finances cannot be ignored by a new administration inheriting a public debt that now exceeds 100 percent of GDP. More taxpaying immigrants can extend the fiscal sustainability of federal retirement programs such as Social Security.

Central to the Biden plan is the passage of legislation increasing the number of H-1B visas and employment-based green cards. Both types of visas are limited by caps that were first established 30 years ago: 140,000 work-based green cards a year and 65,000 H-1B visas, plus another 20,000 a year for foreign-born postgraduates from US universities. In his plan, Biden has committed to working with Congress to increase the annual number of such green cards. He also calls for adjusting the number of H-1B visas in response to changes in the unemployment rate.

Congress should build on this idea to permanently expand the number of work-based immigrant visas and H-1B visas. As I noted in a recent essay, domestic demand for workers in the high-tech fields of computers, information technology, engineering and related fields has more than doubled since 1990. In response, the number of work-based green cards should be at least doubled to 280,000. In addition, the immediate family members of the primary visa holders—spouses and minor children—should be excluded from the visa cap so that even more visas can be awarded to primary workers.

The annual number of H-1B visas should arguably be tripled from the 1990 level, reflecting the especially strong growth in computer design and related fields, where two-thirds of H-1B visa holders work. Legislation could build on the Immigration Innovation Act introduced in the US Senate in 2018, which would have allowed the annual cap to roughly triple to 195,000.

The Biden campaign idea of then adjusting the visa numbers in subsequent years based on labor market conditions should be adopted. But rather than tying the number of visas to the unemployment rate, as the campaign proposes, the adjustment should be based on growth in the relevant labor market. If employment in the subcategories most closely tied to the visas increases by a certain percentage from year to year, so should the visas made available; if the total number of jobs in a subcategory decreases, the visas available should decrease by the same proportion. This automatic visa escalator would reduce the possibility that the number of visas would fall behind market demand, as has happened in the past three decades.

Another Biden proposal worth pursuing would be to grant a work-based green card to foreign-born students who graduate from a US university with a PhD in a STEM subject. The administration and Congress could also work together to approve agreements with major trading partners such as Canada and the United Kingdom to allow the freer movement of workers between those countries and to more generally streamline the visa process and ensure that fees are reasonable and based on offsetting costs.

Along with expanding the number of visas, the new president and Congress must work together to eliminate discriminatory per-country quotas on employment-based visas that create unacceptably long waiting lines for workers from India and other nations. Bipartisan support exists to eliminate this anachronism from a bygone era that rejects certain foreign-born workers simply because of the nation of their birth.

In a nod to union leaders, the Biden immigration plan would establish a process that favors higher wage requirements for temporary visas and the right to join a union. Any immigration reform plan should tread carefully in this area, because setting artificially high “prevailing wages” as a condition of visas can in effect price the foreign workers out of the labor market (which is what the Trump administration has sought to do with its recent Department of Labor rules on H-1B visas). And any guarantees of the right to join a union must be balanced by the equal right not to join a union, as already protected in a number of “right to work” states.

As he works with Congress to change immigration law, soon-to-be President Biden could act immediately through executive orders to do the following:

  • End the Trump administration’s policy of separating families at the border who are applying for asylum.
  • Reverse the Trump administration’s “public charge rule” that was intended more to discourage hardworking immigrants from entering the United States than to protect US taxpayers.
  • Rescind the Trump administration’s “travel ban” aimed mostly at Muslim-majority countries and instead focus Department of Homeland Security resources on identifying and excluding high-risk individuals from entering the United States.
  • Raise the cap on refugees from the embarrassingly low levels set by the Trump administration. The Biden immigration plan commits his administration to “set the annual global refugee admissions cap to 125,000, and seek to raise it over time commensurate with our responsibility, our values, and the unprecedented global need.”

All of these actions together would represent a sharp turn from the Trump administration’s unprecedented curbs on the ability of foreign-born workers to help build a brighter future, both for themselves and for our nation. Through executive actions and bipartisan legislation, a Biden administration and Congress can restore and expand the US immigration system that has served our nation well for decades.

This is the first of two essays laying out an immigration agenda for the new administration and Congress. This piece focuses on changes in legal immigration, while the second essay will tackle the long-standing challenge of reducing illegal immigration.

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