By Joe Guzzardi
Januray 4, 2013
Engraved on a bronze plaque mounted inside the Statue of Liberty are poet Emma Lazarus’ famous words: “Give me your tired, your poor, your huddled masses yearning to be free…”
Lazarus wrote her poem, the New Colossus, in 1883 eight years after the United States passed its first immigration legislation. The Page Act of 1875 prohibited the entry of any person the federal government deemed undesirable, a specific reference to Asian men who might be used as cheap labor or Asian women who could be forced into prostitution.
Today, nearly a century and a half later, the United States is promoting a different immigration approach that’s hardly as compassionate as Lazarus’. If a new poem were written, it might include this stanza: “Give me your wealthiest investors, willing to forego their native country’s financial and reconstruction needs in exchange for a U.S. green card.” The EB-5 visa for foreign-born investors, minimum investment $500,000, puts citizenship up for sale in exchange for helping the rich get richer and creating a handful of American jobs. Investors’ immediate family members qualify for green cards too and their children can attend public schools. The U.S. visa program is immensely popular among wealthy Chinese immigrants many of whom are uncomfortable with their restricted lives.
The EB-5 has recently received headline attention in business journals because foreign nationals have funded a large portion of a $865 million rural Vermont ski resort that includes a hotel, indoor water park, ice hockey arena, condominiums restaurants and retail stores. According to Bill Stenger, the project’s developer and co-owner, the development has already attracted 550 foreign investors from 60 countries and has generated $275 million in funding. The second and third phases which have broken ground will require 1,000 more EB-5 investors to put up an additional $500 million.
Like most of the non-immigrant visa programs, the EB-5 has a long history of fraud and abuse. Many investments have been scandalously bad and eventually turned sour. One would be EB-5 investor, Ofer Biton, had ties to the Gambino crime family. The complaint filed against Biton strongly suggested that his investment money came from extortion and was not, as required, legitimately earned. Among the failed businesses are the seedy, infamous Washington D.C. Watergate Hotel, a Missouri artificial sweetener manufacturer and bankrupt South Dakota dairy farms. Ski resorts are notoriously risky. When the snow doesn’t fall, skiers don’t show up. If the economy goes sour, as it did in 2008, the ski gear stays in the closet. Over the last several years, resorts in Utah, Maryland, California and Yellowstone National Park have gone belly up leaving behind abandoned condos and empty storefronts.
Some of multimillion dollar funding will pay Stenger and his partner Ariel Quiros’ salaries, a bonanza for the already wealthy men. And while the Jay Peak resort may temporarily create Vermont jobs, serious questions about the foreign investors’ backgrounds remain unanswered. The first and most important is how did the investors earn their fortunes? Many may be otherwise inadmissible to the U.S. except for their money and the EB-5 visa’s availability.
Jay Peak’s attraction is the family visas, not potential capital gains. The reward—U.S. citizenship—overcomes the risk. One potential backer, Englishman Steve Green, candidly told the New York Times that even though Jay Peak represents a “substantial risk,” he’s inclined to go ahead so he can “confer those rights [citizenship] on his children.”
The EB-5 visa program is capped annually at 10,000. But the Obama administration is aggressively promoting EB-5 visas and the numbers issued have inched up. In 2006, the government granted 802 EB-5 visas; last year, 7,818. When the cap is reached, the business community will call for raising it.
Selling citizenship, whether for $5 or $5 million, is a horrible idea unworthy of the American immigration tradition and insulting to those of modest means who come conventionally.
Joe Guzzardi is a Californians for Population Stabilization Senior Writing Fellow whose columns have been syndicated since 1986. Contact him at [email protected]