Comment: Going Nowhere Slowly

Good News: Rural and urban lobbies have reached a consensus, and they have language of a bill that they have agreed on. Further, several senior Republican senators have indicated their support for that EB5 language. The plan is to attach the language to the DHS appropriations bill which the advocates expect to pass before the continuing resolution expires on December 3rd.

Bad News: The DHS appropriations draft released by the Senate appropriations committee does not include the EB5 language. This by itself is not necessarily a problem--the language can be added during the markup or as an amendment. Various Congressional staffers working on the EB5 language have raised many questions. There are many possible disagreements that need to be worked out but these questions are not a major problem to resolving the Re- authorization crisis. The key problem with any compromise between the rural and the urban lobby is that they can both get something only by raising the total number of EB5 visas available. This can be done directly through a quota increase or indirectly by exempting family members from counting towards the quota. That is a major political problem--not a minor issue.

To understand why the EB5 quota issue matters we need to examine immigration holistically for this Congress and this administration

On the large $3.5 Trillion “soft” infrastructure bill there is a laundry list of the wish list of Democratic priorities including an immigration provision for 8 million green cards. The first attempt to get those 8 million green cards failed when the Senate Parliamentarian ruled that that language cannot be included in the reconciliation bill. The second attempt to add 7 million green cards by changing 3 words for the registry date failed when the Senate Parliamentarian disallowed it. As an aside, there is a bipartisan consensus on the smaller $1.5 Trillion “hard” infrastructure bill--but not on the “soft” $3.5 Trillion bill--which can only be passed through reconciliation.

The Biden administration is following the Obama playbook on immigration which is enforcement focused--Obama was justifiably called “Deporter in Chief” by immigration advocates. Immigration advocates are hopping mad because the entire Democratic immigration agenda has failed legislatively. In this climate, smuggling in an increase of EB5 numbers directly or indirectly without any other progress on immigration priorities will cause a revolt among Democratic ranks--a single Democratic senator or a small handful of House Democrats can sink such a bill.

During the last 20 years a number of lobbies have tried and failed to increase various immigration quotas. The most powerful of the immigration lobbies has been the tech lobby which includes Microsoft, Google, Apple, Amazon and Facebook. They have tried for 20 years to get some relief from Congress on temporary H1B annual quotas to hire the talent they need. In spite of the crucial importance of the tech industry to the US economy, with all the massive resources of the tech industry, deep political connections with both political parties, and top of the line public relations efforts, they have failed again and again and again under multiple administrations and multiple configurations of Congress. Making a change to immigration quotas is incredibly hard politically in this century. The EB5 industry has been under the delusion that it can succeed where the tech industry has failed, despite the tech industry being a hundred times its size, connections, resources, and national importance of the EB5 industry.

The lesson from the failures of the tech industry to budge Congress on immigration is simple: Anything to be done requires a strong bipartisan consensus. No handful of Senators or Congressmen like Senator Schumer or Representative Nadler can ride roughshod over the likes of Senator Sanders or Representative Ocasio-Cortez to pass their pet immigration quota increase. The one immigration issue which is strongly bipartisan is DREAM. Tying EB5 visa numbers increase to DREAM is the only way to gather enough bipartisan support to actually get Congress to act. Trying to get increased EB5 numbers by themselves without making any concessions to the agenda of progressive Democrats is futile. The EB5 industry is drinking its own kool aid if it thinks it can get a EB5 quota increase (directly or indirectly) in this Congress--ignoring the EB5 industry's own legislative failures over the past 5 years, and the failures of the tech industry for the past 20 years. We encourage the EB5 industry to attach DREAM to the rural/urban compromise language in order to ensure passage. 

Further, DHS appropriations is customarily the last of the appropriations bills passed, and when you look at the historical passage of DHS appropriations, March 2022 is the most likely time frame. We would be delighted to have a EB5 reform bill with increased numbers pass as a part of DHS appropriations--but our 20 years experience of covering the immigration legislative dance leads us to conclude that the current EB5 reform effort will likely come to naught and do so painfully slowly.

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