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How to Make Guest Worker Visas Work

How to Make Guest Worker Visas Work

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Published by Cato Institute
President Obama and a bipartisan group of eight senators have begun to push for immigration reform. Speaker of the House John Boehner (R-OH) likewise said he supports an immigration overhaul as a "top priority" for 2013. The Texas Republican Party even called for an expanded and effective guest worker visa program to link American employers with skilled and low-skilled foreign workers.

The three components of politically feasible immigration reform are legalization for some unauthorized immigrants, border and workplace enforcement to impede the entry and hiring of unauthorized immigrants, and increased numbers of guest workers and legal immigrants. The costs and benefits of legalization, security, and employee verification have been debated elsewhere in detail but the costs and benefits of guest worker visas and how to create them have not been similarly explored.

An expanded and lightly regulated guest worker visa program is an essential part of any immigration reform proposal. A guest worker visa program should efficiently link foreign workers with American employers and function with a minimum of government interference. Market forces as well as security, criminal, and health concerns should be the factors that determine which workers acquire visas. A successful guest worker visa would also divert most unauthorized immigration into the legal system, shrink the informal economy, be easily enforceable, support economic growth in the United States, and narrow the government's role in immigration. Below are numerous suggestions that would achieve such reform and expand America's current guest worker visa programs.
President Obama and a bipartisan group of eight senators have begun to push for immigration reform. Speaker of the House John Boehner (R-OH) likewise said he supports an immigration overhaul as a "top priority" for 2013. The Texas Republican Party even called for an expanded and effective guest worker visa program to link American employers with skilled and low-skilled foreign workers.

The three components of politically feasible immigration reform are legalization for some unauthorized immigrants, border and workplace enforcement to impede the entry and hiring of unauthorized immigrants, and increased numbers of guest workers and legal immigrants. The costs and benefits of legalization, security, and employee verification have been debated elsewhere in detail but the costs and benefits of guest worker visas and how to create them have not been similarly explored.

An expanded and lightly regulated guest worker visa program is an essential part of any immigration reform proposal. A guest worker visa program should efficiently link foreign workers with American employers and function with a minimum of government interference. Market forces as well as security, criminal, and health concerns should be the factors that determine which workers acquire visas. A successful guest worker visa would also divert most unauthorized immigration into the legal system, shrink the informal economy, be easily enforceable, support economic growth in the United States, and narrow the government's role in immigration. Below are numerous suggestions that would achieve such reform and expand America's current guest worker visa programs.

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Published by: Cato Institute on May 06, 2013
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Executive Summary 
President Obama and a bipartisan group of eight senators have begun to push for immigra-tion reform. Speaker of the House John Boehner(R-OH) likewise said he supports an immigra-tion overhaul as a “top priority” for 2013. TheTexas Republican Party even called for an ex-panded and effective guest worker visa programto link American employers with skilled andlow-skilled foreign workers.The three components of politically feasibleimmigration reform are legalization for someunauthorized immigrants, border and work-place enforcement to impede the entry and hir-ing of unauthorized immigrants, and increasednumbers of guest workers and legal immigrants.The costs and benefits of legalization, security,and employee verification have been debatedelsewhere in detail but the costs and benefits of guest worker visas and how to create them havenot been similarly explored. An expanded and lightly regulated guest work-er visa program is an essential part of any immigra-tion reform proposal. A guest worker visa programshould efficiently link foreign workers with Amer-ican employers and function with a minimum of government interference. Market forces as well assecurity, criminal, and health concerns should bethe factors that determine which workers acquire visas. A successful guest worker visa would alsodivert most unauthorized immigration into thelegal system, shrink the informal economy, beeasily enforceable, support economic growth inthe United States, and narrow the government’srole in immigration. Below are numerous sugges-tions that would achieve such reform and expand America’s current guest worker visa programs.
 How to Make Guest Worker Visas Work
by Alex Nowrasteh
No. 719January 31, 2013
 Alex Nowrasteh is an immigration policy analyst with the Center for Global Liberty and Prosperity at the Cato Institute.
 
2
From American independenceuntil 1882, theUnited States had a nearly open borders policy.
History of Guest Worker Visas
Guest worker programs are not a recentpolicy development. The ancient Greek city-state of Athens had a similar program whereworkers were called
metics
and had to pay a special tax called a 
metoikion
.
1
 
 Metics
were notallowed to own real estate or participate in pol-itics but they could work, amass wealth, andbe productive members of the Athenian econ-omy.
2
Aristotle and Cephalus, whose mansionSocrates visits at the beginning of the
 Republic 
,are two of the most famous
metics
.
3
During the Middle Ages and Renaissanceforeign skilled workers were often allowed tolive and work in designated neighborhoodsin major European cities. Foreigners livingin these zones had certain legal protections,could rent or own property, and lived withfewer rights and responsibilities than othersubjects and citizens. For example, King Ed-ward I of England granted a zone in Londonto Italian goldsmiths as part of his merchantlaw reforms so they could live, own property,and ply their trade in the city.
4
The area even-tually became known as Lombard Street,named after the area of Italy where the gold-smiths originated, and it attracted other fi-nancial institutions and insurance compa-nies into the present day.In the 18th century the British Empire re- vived a special legal designation called a “deni-zen” to allow immigrants to own property be-fore becoming citizens. Denization was vitalduring the British settlement of North Amer-ica because the 18th century British commonlaw allowed only British citizens to own realestate. To attract settlers to the Americancolonies from different nations, the Britishcreated the legal category of denizens to allow immigrants to own property before becom-ing citizens.
5
Denizen rights were limited, butthey only lasted one generation. Birthrightcitizenship extended to all born of free parent-age in the British Empire, so the children of denizens were born as British citizens.
6
 From American independence until 1882,the United States had a nearly open borderspolicy where only criminals, the ill, and peo-ple with a high probably of harming Ameri-cans were barred from immigrating. Duringthe 19th century successive and overlappingwaves of immigrants from Ireland, Italy, Po-land, Russia, Germany, China, and Japan ar-rived in the United States. Their descendantsassimilated culturally, economically, andpolitically with little trouble. In the middleof the assimilative process, the 1882 ChineseExclusion Act barred the immigration of most East Asians. Gradually, the U.S. Con-gress restricted immigration so much thatduring the Great Depression virtually all im-migration was illegal.
7
When the United States entered WorldWar I in 1917, low-skilled immigration fromEurope halted. Coupled with the mobilizationof millions of American men into the armedforces and the Immigration Act of 1917, which virtually ended free Mexican immigration,some American industries were faced withlarge manpower shortfalls.
8
The Immigration Act of 1917 allowed the secretary of Labor toengage in contract labor with temporary guestworkers in limited conditions, like the emer-gency caused by World War I.
9
The programlasted from 1917 to 1921 and brought in80,000 Mexicans, along with small numbers of Bahamians and Canadians, to work farmingsugar beets, cotton fields, and as railway work-ers.
10
Under pressure from Samuel Gompers’ American Federation of Labor, a small num-ber of migrants who worked in railways wereremoved at the end of the war while the rest of the program was terminated in 1921.
11
The labor demands of World War IIprompted the U.S. government to create a modern guest worker visa through the Emer-gency Farm Labor Supply Program in 1942,popularly known as the Bracero Program.
12
The program set out rules for the temporary employment of Mexican farm workers by U.S. farmers who employed them so long asthey did not displace American workers.The government regulated the wages, du-ration of employment, age of workers, mi-grant health care, and transportation fromMexico to U.S. farms.
13
Transportation to
 
3
Increased lawful migration,flexibility,and smart enforcement funneled workers into theBracero Programand reduced unauthorized immigration by an estimated 90 percent.
the farm, housing, and meals were sold by theemployers for a low price.
14
Importantly, theBracero Program did not limit the numberof migratory workers as long as the govern-ment’s conditions were met, making the sys-tem relatively flexible. Increased lawful mi-gration, flexibility, and smart enforcementfunneled workers into the Bracero Programand reduced unauthorized immigration by an estimated 90 percent.
15
 From its humble beginnings in September,1942, when the first group of 500 Braceros ar-rived at a farm outside of Stockton, Califor-nia, until the program’s cancellation in 1964,nearly five million Mexicans worked legally inthe United States.
16
From 1955 to 1960, an-nual Bracero migration fluctuated between400,000 and 450,000.
17
By the time of its can-cellation, increasing regulations and restric-tions whittled their numbers down to just168,000.
18
Those regulations raised costs forfarmers and migrants, incentivizing migrantsto move into the informal, undergroundeconomy.
19
By making lawful employmentof migrants so expensive, the government cre-ated unauthorized immigration.Pressure from unions, especially CesarChavez’s United Farm Workers (UFW), per-suaded Congress to cancel the Bracero Pro-gram in 1964.
20
The great grape strike of 1965, which was the UFW’s first major suc-cess, was only possible after Congress can-celled the Bracero Program and Mexican la-borers were denied legal work opportunitieson American farms.
21
 After cancellation of the Bracero Pro-gram, the H-2 guest worker visa became thesource of legal foreign agricultural workers.The H-2 was underused relative to the Bra-cero Program because of complex rules, nu-merical restrictions, and the cost of sponsor-ing migratory workers.
22
The H-2 visa wasinitially created through the Immigrationand Nationality Act of 1952 for “other tem-porary workers” not covered by the BraceroProgram.
23
From 1964 until 1986, mostly temporary unauthorized Mexican migrationfilled the gap left by the repeal of the BraceroProgram and unfilled by the H-2 visa.
24
 The 1986 Immigration Reform and Con-trol Act separated the H-2 visa into the H-2Afor temporary agricultural workers and theH-2B for seasonal nonagricultural workers.
25
 Over time, the Department of Labor createdeven more extensive regulations for the H-2A visa.
26
Although the H-2A visa faces no nu-merical limit, the complexity of federal regula-tions has made the visa too expensive for mostfarmers.
27
The H-2B visa, although less com-plex, is numerically capped.
28
The Immigra-tion Act of 1990 created what we now know as the H-1 visa for highly skilled workers.
29
 There are other infrequently used temporary guest worker visas for those with extraordi-nary abilities in the sciences, arts, education,business, athletics, and entertainment.
30
The American guest worker system dividesmigrants into visa categories based on theirskills and occupation. It then creates differ-ing regulatory burdens through inspection,wage controls, employee benefit mandates,country-of-origin restrictions, worker mobil-ity, numerical quotas, and numerous otherlimitations on the employment and numberof guest workers. Since World War I the levelof control and restrictiveness of quotas hasincreased, creating an environment whereunauthorized immigration can thrive.
Why Do They Migrate?
Migrants are drawn to economic op-portunity in the United States. Wages foridentical workers in the United States are onaverage 2.53 times as high as in Mexico, pro- viding a powerful magnet for Mexican im-migrants.
31
More important for future im-migrants, wage disparities between identical Asian and American workers are even great-er.
32
Workers in India, Vietnam, and thePhilippines, three large immigrant sourcecountries, can expect to see their wages in-crease by about 6, 6.5, and 4 times, respec-tively, by moving to the United States.
33
Wages for observably identical workers vary so much across countries for two majorreasons. The first is that the United States

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