Guest-worker programs are corporate welfare

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Politics,Beltway Confidential,Timothy P. Carney

Newt Gingrich in tonight's debate called for a "guest-worker" program for immigrants. This is the type of compromise our pundit and political class seem to like. Not coincidentally, big business likes it, too.

I think guest-worker programs amount to corporate welfare. I wrote during the 2007 immigration debate:

The Senate bill would create a guest-worker program that would grant 200,000 (the White House wants 400,000) special "Y visas" to foreigners who want to work in the U.S. The three-year visas (also available to illegal immigrants who pay a fine) would be renewable once, but the guest worker would not be eligible to apply for citizenship and could not legally stay longer than six years. Also, a guest worker would be allowed to stay in the country only as long as he is employed in certain jobs approved by the Department of Labor.

There's a huge history of politically connected businesses using guest-worker programs to exploit immigrant labor and avoid using higher-priced domestic labor. The sugar-cane industry was a great example. Here's what I wrote about FDR's sugar program:

This advantage to the farmers of hiring temporary foreign workers was no accident. It was deliberate. In 1940, one grower wrote to the U.S. Department of Agriculture that if Washington were to help them find labor, the Bahamas would be a far better source than either the U.S. or its territory Puerto Rico. “The vast difference between the Bahama Island labor and domestic, including Puerto Rican,” wrote the farmer, “is that labor transported from the Bahama Islands can be deported and sent home, if it does not work, which cannot be done in the instance of labor from domestic United States or Puerto Rico.”

This moment of brutal honesty by a sugar farmer in the months before World War II gives us insight into the mind of shrewd employers throughout the decades. If your worker’s visa limits him to working for you, you become, in effect, the government.

A typical employer in a free market has only the power to stop paying his worker or possibly sue him if he doesn’t perform promised services. But under guest-worker programs, the employer gains the power of deportation.

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