The American dream, for sale - Page 3

Thousands of hard-working immigrants are getting deported every month. But unregulated private companies are offering a deal: for $500,000, you can get a green card.

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According to center executives, they typically charge the investors a fee for facilitating the program they charge their clients. In some cases, the immigrant investors become part owners of a business enterprise; the investors and the regional center gets paid when the business turns a profit. But it's far more common for the regional center to lend the money for projects and collect the interest. Usually immigrant investors get paid only around 1 percent in interest and the regional center picks up the rest.

It's certainly worked for Liebman. He owns and runs 10 regional centers with offices throughout the United States and one in Tokyo. All his investments have gone into commercial real estate. "You don't get to be Bill Gates through EB-5, but it certainly raises your game," he said.

Yale-Leohr did say the program must be "done correctly" and that it's no piece of cake. "It is hard to set up a project that meets all immigration and securities-related requirements."

JOBS? WHERE?

Everyone agrees that the program exists primary because it's supposed to create jobs. "There is a lot of scrutiny of job creation because that is the foundation of the program," Irazabal said.

But that scrutiny is actually limited.

It shouldn't be hard to determine if an investment is creating jobs in the community; either there are people working in a local business or not. But EB-5 experts told us that most of the EB-5 investment doesn't create direct jobs. Sharon Rummery, also a spokesperson for the Citizenship and Immigration Service, said she suspects most of the jobs are indirect. But after checking with agency staff, she told us there's no data.

The difference is critical. Say, for example, some investors build an electric car factory in a neighborhood with high unemployment. They hire 10 people to build cars, and create 10 direct jobs.

But when the workers go out to lunch and the deli counter down the street hires more help, that's indirect job-creation — and how one specific investment creates other jobs is essentially guesswork.

Of course, the electric car factory has to buy materials and parts — say, computer chips — that might be made halfway across the country (and possibly in an area that doesn't have high unemployment). Those jobs count, too. According Irazabal, USCIS has "no requirement for the [indirect] jobs to be in the geographic area" that is struggling economically.

The geographic flexibility USCIS allows is interesting considering that, according USCIS rules, regional centers must have "plans to focus on a geographical region within the United States and must explain how the regional center will achieve economic growth within this regional area."

The most interesting question is whether any of the indirect jobs are ever really created. And the bottom line is, USCIS never checks.

Here's the process, according to USCIS officials. Regional centers create business plans. Then they hire consulting firms to evaluate how many indirect jobs will be created if the business plan all goes as projected. USCIS signs off on the report and the E-5 visas are approved.

The government never does its own studies or reports, never tracks actual indirect job creation, and rarely questions what the private consultants say.

Economist Peter Donahue, who runs PBI Associates in San Francisco, told us the job creation promises under EB-5 amount to a "parable." Models used to track indirect jobs "give the appearance of the science but its probably someone's best guess," he said.

Comments

This ("rich peoples green card") has been around for a long time. It used to be that you had to invest $1M to qualify; but that has been reduced to $500K for "distressed areas". Why shouldn't the rich get a Groupon deal on immigration? Don't you know that the rich run the world, and we just play, I mean, slave, in it?

Posted by Guest on Mar. 02, 2011 @ 7:57 am

Every nation has a program like this. In some countries, just five or ten thousand dollars will get you citizenship, and even with any name you want!

I can't believe that any so-called professional journalist isn't aware these types of inducements aren't ubiquitous.

Posted by Wally on Mar. 02, 2011 @ 8:20 am

It's been around a while, but now it's really starting to boom, esp in the Bay Area -- and it's ironic, is it not, that this happens at a time when the US is deportng record numbers of people who also contribute -- and quite possibly contribute more -- to the economy?

Posted by tim on Mar. 02, 2011 @ 1:52 pm

You mean maybe we want immigrants who contribute more to the economy?

It's always been that way. H visa's and Green Cards have always been issued to those with favored and specialized skills that are needed here. Of course. Again, every nation does that.

Only the SFBG would prefer minimum wage illegals to successful professionals.

Posted by Wally on Mar. 02, 2011 @ 5:41 pm

H1-B visas are intended to drive down tech wages and have done so very well while making it more difficult for American techs to compete for work against those whose alternative is returning to subcontinental poverty.

http://www.cs.ucdavis.edu/~matloff/h1b.html

Lowering wages are not how we get to a progressive society.

-marc

Posted by marcos on Mar. 02, 2011 @ 5:57 pm

they are already too high by standards of international competitiveness.

If American workers are paid too much, and it seems they are, then that differential will be arbitraged away either by:

1) Inbound immigration
2) Outsourcing
3) Devaluation of the US dollar

Most likely, all three at the same time, until we reach parity.

The invisible hand trumps social engineering every time.

Posted by Wally on Mar. 02, 2011 @ 6:28 pm

Government protectionism is the traditional way that a popular government puts its citizens first. Everything else is just speculative theory that has run the economy off the cliff in a way that makes the 1970s look like the 1950's.

Please, you all need to put this before the voters under the banner "Sweatshop jobs for all!"

-marc

Posted by marcos on Mar. 03, 2011 @ 3:22 pm
So?

As noted this is:

A. Not new
B. Hardly unique to the US

Immigration shouldn't be "first come first served." It should be based on a lot of different factors including possessing a desirable skill set and education. And yes, the ability to sustain oneself and invest in needed areas of the US economy should also be a factor in certain cases.

And FYI: having $500,000 to invest may be the product of a lifetime of work for someone. It doesn't make them "rich."

Posted by Lucretia Snapples on Mar. 02, 2011 @ 2:04 pm

I spent a couple of years debating the immigration issue on various blogs. One thing that has always troubled me greatly is that this issue tends to bring out the very worst in people, particularly those who think nothing of dehumanizing entire groups of people based on a faulty perception of the perceived race or class of the "alien other".

We don't like to admit it, but this perception of race and class generally goes hand in hand in, since the darker and poorer you are, the less likely you are to fall into the "good immigrant" category.

Maegan "La Mala" Ortiz does a brilliant job of illustrating this meme in her blog Vivir Latina. The narrative goes like this~

“Good” immigrants, according to the politicos and the mainstream media that parrots them, are the ones who follow the laws, and when they don’t face the consequences, in the form of raids, separation from families, deportation, incarceration and fear. “Good” immigrants work hard and don’t make too much noise. They don’t have more children then they can afford and they don’t live on welfare. They speak English and study hard and get good grades and try to go to college. Within this context there are bills. Bills so that “good” immigrants and their children can go to college and pay in-state rates (like the DREAM Act)."

"But in order to have good you must have bad and it’s too easy for any person once deemed good to fall into the other category. The “bad” immigrants, like the ones portrayed in the ad above, test the compassion of people. They look like gang bangers and obviously cannot assimilate or fit in. The obviously “bad” ones commit horrible crimes only against “white” like rape and murder (because whites apparently don’t do things like that). More minor crimes aren’t placed in context like say poverty, racism or global policies."

Please read that last sentence again because it is key.

Posted by Lisa Pelletier on Mar. 02, 2011 @ 6:52 pm

The far right, and the far left, both of whom make everything about race, to the point of tedium.

I always love your quoting fellow sour leftists.

I enjoy looking them up and reading the conspiracies theories and bitter complaints.

Posted by meatlock on Mar. 02, 2011 @ 7:30 pm

Anybody who is basically literate and doesn't have a recent criminal record should be able to contribute to this country; let them in.

If they have $500K of real money to show, by all means roll out a (slightly tattered) red carpet. Our gain, their country's loss.

Posted by Letmypeoplefree on Mar. 03, 2011 @ 8:42 am

THEY'VE GOT MONEY. WHAT'S THE BIG DEAL? JUST MORE POLITICALLY CORRECT SLOP FROM SAN FRANCISCO AND ITS FOLLOWING APART ECONOMY....

Posted by Guest Michael on Mar. 03, 2011 @ 9:24 am

Chinese investors beware. Example: Tom Henderson was a fish salesman for 30 years with no experience in job creation. He's running around town with his 'quirky' persona (read: he seems to piss off everyone he meets) making lots of promises and looking to get rich off your money. But bottom line: he has no experience at this sort of thing. What companies has he started in Oakland? How many jobs has he created? What boards or councils has he served on that show this has been his focus and community interest?

Best to go with an attorney or agency that has a long history and credibility in creating jobs.

Posted by Guest Sarah on Mar. 05, 2011 @ 10:09 am

Hey Sarah,
This is Tom "Quirky Charisma" Henderson. In the future please use a pseudonym (ie., Fake Name). Your boyfriend Eric (My EB-5 Regional Center Competitor) needs to step up himself instead of hiding behind your comments. I understand Eric's jealousy not being interviewed for this article, but not my call.
FYI... I sold "my" $50M Seafood International Import Export company in 1993 where I had 300 employees working full time in Northern Calif for 20 years. You guys need to be more creative with the cheap shots.
The Bay Guardian did a nice job with an edge to the story. Some accurate and some questionable. But that is their job...
We will create 1000 high paying jobs in Oakland every year for a number of years as long as this EB-5 program continues to provide the job opportunites and investments into Oakland with an actual unemployment rate of over 20%. The City of Oakland Economic Development staff support our efforts.
Good luck to you and Eric.
Best Regards,
Tom Henderson

Posted by Guest Tom Henderson on Mar. 14, 2011 @ 10:04 pm

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