The omnibus spending bill currently before Congress includes a small but ill-conceived program that deserves to be noticed, then deleted. The EB-5 Regional Center program that gives visas to investors invites abuse and is failing to do what it's meant to.Why? Because:
Almost all the investment goes to New York City, San Francisco, Houston and other metropolitan areas, where it provides cheap financing for real estate developments that achieve their "high-unemployment" designation through gerrymandered districts. The Department of Homeland Security says it can only "speculate" about the overall effect on investment and jobs. A plausible speculation is that the effect is minimal.Or, as I wrote, perhaps the country's leading middleman (aka profiteer), Nicholas Mastroianni II (who runs the U.S. Immigration Fund, a major regional center, or investment pool), admitted there's no real job creation:
"Projects that don't typically need the capital are the projects that we look to lend money on," he said, on video. "If a project can't be developed without the EB-5 capital, it's not a project that you should be looking to invest in, because you've got a desperate situation."
Bloomberg View also points to issues of fraud and abuse and notes that, while the program might improved, there's no indication it helps much. Its recommendation: auction off the visas.
That makes sense. If we're going to sell access to the USA, why let the middlemen (regional centers, lawyers, migration brokers) and the end user (developers getting below-market loans) make all the money.