Buried in the Omnibus, a Step Back for Immigration Reform

Anti-immigration activists who helped to derail comprehensive immigration reform last year are seething over several provisions of the omnibus spending bill passed by Congress last week. Tucked away in the mammoth legislation were some of the most significant changes in years to U.S. immigration laws. One of the biggest would greatly expand the H-2B program for temporary seasonal non-agriculture workers such as landscapers, restaurant staff, and seafood processors. Senator Jeff Sessions (R-AL), who led the fight in the Senate against comprehensive reform, lamented that the new provisions would “line the pockets of special interests and big business.”

Welcome to piecemeal immigration reform. After the Alabama Republican and others succeeded in killing comprehensive reform, the only Plan B for those seeking changes to immigration laws was to tackle it piece-by-piece. And the results so far are not encouraging. In the absence of sensible, comprehensive legislation, industry lobbyists, trade unions and others are now pushing to get their favored pieces into some must-pass legislation, like this year’s omnibus spending bill. Alongside the new H-2B provisions, the spending bill has also reshaped the H-1B program for skilled workers by doubling the fees for many companies to as much as $10,000 per employee. But the different pieces will do nothing to address the larger problems in U.S. immigration law, and indeed will make it harder to achieve sensible reform in the future.

The problem with piecemeal reform – apart from its susceptibility to the worst of pork barrel, interest group politicking – is that the challenges in the immigration system cannot be properly addressed one-by-one. Consider the new provisions for temporary, low-skilled workers. The issue of low-skilled work was one of the hardest ones in the Senate immigration reform bill, which passed with 68 votes in 2013. The AFL-CIO and the Chamber of Commerce spent more than a year trying to find a sensible middle ground between the Chamber’s desire to ensure that companies could find the workers to meet seasonal surges in demand and the unions’ desire to protect the jobs and wages of American workers. The compromise that was reached was a carefully balanced one that would have allowed the numbers to fluctuate with the state of the U.S. economy and the demand for workers. And both sides were willing to take half a loaf because there were other measures in the comprehensive bill that they liked.

The new provision blows that compromise out of the water. It could lead to a doubling or tripling of the 66,000 seasonal workers who come under the existing program, will weaken the requirements that employers seek out American workers first, lower the wages paid to many foreign workers, and reduce federal oversight of employers. Daniel Costa of the Economic Policy Institute says the new provision will "create a huge incentive to hire temporary foreign workers instead of the local U.S. workers who reside in communities where the jobs are located." As is so often the case with special interest-driven legislation, this one was championed by a Maryland senator, Democrat Barbara Mikulski, to serve the needs of the Chesapeake Bay seafood industry, which hires just 200 foreign workers each year. As a result of her efforts, the companies that use H-2B workers are happy now, but they will have no incentive to compromise in the future.

The unions will be happier, in contrast, with the stiff new fees under the H-1B program and the companion L-1 program that allows companies to move foreign workers to the United States for temporary stints.  The H-1B and L-1 programs have long been heavily used by a small number of mostly Indian-owned companies that perform back office services for U.S. multinationals, and the new fees are targeted at those companies. And as the New York Times documented earlier this year, there have been some real abuses, including U.S. employees at Disney being forced to train their own replacement foreign workers.

The comprehensive immigration reform bill tried to do two things at once – expand the annual H-1B quota to ensure that U.S. companies could hire the best of the world’s talents, while cracking down on abuses in the program. Instead, the omnibus bill takes a sledge hammer to the problem by making the costs of hiring H-1B or L-1 workers prohibitive for many companies. The companies that are most affected – Indian firms like Tata and Infosys – simply didn’t have the friends they needed on Capitol Hill to block the legislation. And the issue is likely to spill over into U.S.-India relations, where the move is seen simply as a protectionist backlash by the United States even as it has been calling on India to open its market to U.S. goods and services. As with the H-2B language, opponents of the H-1B program now have much of what they wanted, and will have no incentive to compromise in the future.

Whatever the flaws of the Senate’s comprehensive immigration reform bill, it was a serious effort at finding a middle ground between the legitimate needs of some employers to hire foreign workers and the equally legitimate desire of unions to protect jobs, wages, and working conditions for Americans. With the new measures in the omnibus bill, however, the incentives for sensible accommodation by both sides have just been wiped away.