Unable to Create Jobs the Obama Administration offers Citizenships to Rich Foreigners who Can

Posted by PITHOCRATES - June 17th, 2012

Week in Review

Unable to understand how the economy works the Obama administration maintains policies that restrict economic activity.  And removes incentives to create jobs.  Their Keynesian economic policies have been such an abject failure that after three and a half years of trying they’re asking rich foreigners to create the jobs they cannot.  By selling citizenship (see Citizenship for sale: Foreign investors flock to U.S. by James O’Toole, CNNMoney, posted 6/11/2012 on Yahoo! Finance).

The State Department expects to issue over 6,000 “investor visas” in the current fiscal year, which would be an all-time record. Other countries, meanwhile, are following the U.S.’s lead, keen to spur growth in lean economic times.

“Our goal is certainly job creation, and that’s what this program is all about,” said Bill Wright, a spokesman for U.S. Citizenship and Immigration Services. “At the same time, it’s allowing somebody from a foreign country to come and invest in our nation.”

Under the government’s EB-5 Immigrant Investor program, foreign investors can get conditional visas that allow them and their families to live, work and attend school in the U.S. To qualify for the visa, they must invest at least $1 million in a new or recently created business, or $500,000 for businesses in rural or high-unemployment areas.

The investment must be demonstrated to have created or preserved at least 10 full-time jobs for U.S. workers within two years. Assuming this condition is met, investors and their families graduate to permanent resident status, and can apply for full citizenship three years later…

Of the roughly 12,000 immigrants who’ve arrived on the EB-5 investor visa, just 39% have earned permanent residency, according to USCIS data…

So I guess this means the Obama administration is throwing up their hands and crying “uncle.”  They don’t know how to create jobs.  So they’re offering citizenship to those who do.

Small business owners (the number one job creator in the country) start out their business for far less than $1 million.  These people know how to create jobs.  And they would.  If it weren’t for the anti-business policies of the Obama administration.  The regulatory compliance costs are so great that it discourages these engines of job creations from going into business.  Or expanding their businesses.  And the big thing hanging over them like the Sword of Damocles is Obamacare.  They are so unsure of what will happen when that sword falls that they are not hiring anyone unless they absolutely have to.

Creating jobs is easy.  It’s like a dog having puppies.  You don’t have to do anything.  But you can’t fight against it.  If you reduce the regulatory compliance burden for these job creators that’s all you have to do.  And they will create jobs.  Lots of them.  And they’ll create far more than the 46,800 (12,00 X 0.39 X 10) jobs these rich immigrants have made.  

In the U.S., the immigrant investor program has been responsible for at least 46,810 jobs and more than $2.3 billion in investments since its inception in 1990, according to U.S. Citizenship and Immigration Services.

That’s a small fraction of overall foreign investment in the U.S., but it comes at no cost to the government. Were the EB-5 program to meet its 10,000-visa quota, it would contribute more than $4.4 billion to GDP and create or preserve nearly 75,000 jobs annually, according to a 2010 report prepared for the government by consulting firm ICF International.

That’s funny.  Nearly 75,000 jobs annually?  If I divide the proudly stated number of jobs created (46,810) by the number of years the program has been in effect (about 21 years) that comes to a whopping 2,230 jobs they created per year by selling citizenship to rich people.  Which is a lot less than 75,000.  And it’s not going to help much when Solyndra alone lost almost half that amount when it went bankrupt.  When you add in all the other lost jobs from the failed green job initiatives these new jobs won’t even replace those lost in green energy alone.  Let alone those unemployed suffering in an employment climate with a double digit unemployment rate (the U-6 unemployment that counts those underemployed and those who gave up looking for work is currently about 14.8%).

Ah, yes, what about those preserved jobs?  It’s just a number they pull out of the air.  There is no measurement for it.  Unless the vast majority of these jobs for citizenship (97%) where from these rich foreigners practicing ‘vulture capitalism’ (i.e., private equity).  Because that is something you can measure.  Such as when Bain Capital saved Toys R Us.  However many people were working at Toys R Us at the time who had a job had their job saved by Bain Capital.  Still, this didn’t happen in the first 21 years of the program.  For the number of created and preserved jobs is still only 2,230 jobs per year.

These rich people the Obama administration is turning to for help may create jobs.  In fact, immigrants coming to the land of opportunity created many jobs.  In America.  Where people were free.  And government was limited.  Where you could work hard and enjoy the proceeds from your labors.  Which is why they came.  But it’s not quite like that anymore.  Entrepreneurs are not as free as they were when they built this great nation.  Perhaps that explains why this program has only a 39% success ratio so far.  Even foreign millionaires have trouble creating jobs in America these days.  Why?  Because the current tax and regulatory climate is just not conducive to creating jobs.  No matter how much money you start with.

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