Green Cards for Detroit? Interesting Idea, but Mostly a Distraction

Rick Snyder, the Republican Governor of Michigan recently introduced a new plan to “jump-start” the economically suffering city of Detroit. He proposes that over the next five years, the government authorize the granting of 50,000 EB-2 green cards—i.e., immigrant visas granting legal permanent resident (LPR) status in the employment-based, second preference category—to foreign workers who hold advanced degrees or have “exceptional ability” and are willing to live and work in Detroit. This could either be done by creating additional new immigrant visas, or by reallocating existing ones. There’s no question that Detroit needs many more people to move into its empty spaces and increase its tax base dramatically. But is this the way to do it? It’s an interesting idea worth exploring, but the mechanics of it would be complicated, the numbers are probably unrealistic, and the politics will undoubtedly be messy. It also takes the focus off the 18 percent of workers in Detroit who are unemployed, and those who are seeing their pensions plundered. With that being said, here are some of the main issues at play.

Allocating new or existing immigrant visas to an individual city or state has never been done in the United States. However, it is not unprecedented. Many Canadian provinces are able to sponsor permanent residence visas for immigrants who agree to live and work in the sponsoring province (what’s known as the Provincial Nominee Program). If enacted in the United States, an important question to consider would be the visa’s terms and conditions: Immigrants granted an EB-2 can live and work anywhere they wish, so to restrict them to Detroit, the government would have to make the visa provisional; that is, make it revocable if the holder doesn’t live and work in Detroit.

How long would this provisional period last? For the life of the immigrant? For a set number of years? It’s hard to believe the U.S. would issue an immigrant visa that restricted someone geographically for their entire life. Perhaps one reasonable option is to keep the geographical restriction until the immigrant gets citizenship. Immigrants holding an EB-2 are eligible for citizenship after 5 years. Is that long enough for Gov. Snyder?

The New York Times quotes Gov. Snyder as saying that Detroit EB-2 immigrants would have to arrive with jobs. That’s the case for EB-2, but Snyder’s press release notes the EB-2 visas should come under the National Interest Waiver provision. This means Detroit employers could bypass the labor certification process, which would otherwise require them to first check if there is a qualified U.S. worker available and to pay the local prevailing wage. If a labor shortage truly exists in Detroit, I don’t see why employers shouldn’t have to prove it. But there’s also a chance that the jobs crisis is so bad that there aren’t enough job openings available for 50,000 new immigrants, regardless of the rules in place.

Gov. Snyder is apparently hoping these immigrants will themselves become job creators and business owners. This might be wishful thinking. There’s evidence that immigrants are slightly more entrepreneurial than the U.S.-born, but we should be careful about making sweeping claims about the potential of skilled immigrants with advanced degrees to build new start-up businesses. Look at some of the basic data: 3.5 percent of all immigrants in the labor force are small business owners, as compared to 3.3 percent of the U.S.-born. In other words, immigrants are slightly more likely to be business owners, but business owners are a small part of any population. And while Snyder’s proposal targets immigrants with advanced degrees, most immigrant small business owners don’t even have a bachelor’s degree (58%). While immigrants are clearly a positive force in the economy, this aspect shouldn’t be oversold. It also takes time to make connections and find investors, so these job-creation benefits aren’t likely to be seen in the short term.

Instead, given the decades-long deindustrialization and disinvestment in Detroit, an entrepreneur visa pilot program would make more sense. If a prospective immigrant has a business idea and investors willing to hand over a lot of cash to make it a reality, and is willing to locate in Detroit, then we should give him or her a green card (a provisional one with benchmarks). This is an idea that Canada is starting to play with, and there’s a less targeted version of an entrepreneur visa in the immigration bill that passed in the Senate last summer. The pilot program could begin with one or two thousand visas, with the government closely monitoring the progress of the immigrants and the new businesses created to see what the impacts are on the local economy and whether good jobs were in fact created. If it works well, the program can be renewed and expanded.

Finally, it should be noted that Governor Snyder’s proposal is not politically feasible in the current legislative climate. It was reported that Gov. Snyder believes a reallocation of existing visas could be achieved solely with executive action, but I disagree. Congress would have to act, and it’s almost impossible to believe that this Congress would approve a stand-alone bill to reallocate or create 50,000 new green cards anytime soon. If Detroit were to get this many visas for itself (the five-year total is equal to about one-third of all employment-based green cards the U.S. issues annually), other cities and states would want their own before their legislators would vote for it. That could get messy; we would need a new city- or state-based green card allocation system. There are also other issues to consider, such as the many workers and sponsoring employers waiting years for a visa because of the large backlog. Additional visas might have to be created for them first—but it’s difficult to see that passing in the House of Representatives, unless as part of a larger package of bills to reform immigration laws.

So, let’s all agree to think of innovative solutions to “jump-start” Detroit’s economy and put people back to work. But let’s not get distracted. If Gov. Snyder cares about Detroit’s economy and workers, he should start by restoring the unemployment benefits he’s cut and by making whole the public sector workers that are being robbed of the pensions they paid into for years. The $350 million over 20 years he recently proposed that the state direct towards Detroit’s pensioners is a cosmetic drop in the bucket. To have a real impact, the State of Michigan should pay Detroit (now, not over 20 years) the more than $500 million Detroit lost in income tax revenue and state revenue sharing when the state reneged on a tax deal it made with the city in 1999. Asking the federal government to send Detroit 50,000 educated immigrants—while knowing there’s virtually no chance it will happen—simply allows Gov. Snyder to look like he’s trying to do something positive for Detroit while he continues to ignore—or even exacerbate—the city’s pain and suffering.