Contrary to the popular notion that hordes of rich investors swarm onto US shores flashing investment visas, they are few and far between compared with the much larger numbers who get green cards by having technical skills or higher degrees from US universities.
Recently the Chinese media have been trumpeting that Chinese immigrant investors who become legal residents through the EB-5 visa for immigrant investors — along with analogous visas offered by Canada, Australia and European nations — are the new “ATM machines” for their new homelands. In fact, during the 2011 fiscal year only 3,800 EB-5 applications had been filed by all nationalities combined.
Chinese made up the vast majority — upwards of 80% — of those applicants. But those numbers are dwarfed by the numbers of Chinese, Indians and other Asians who become legal US residents through the H-1B visas obtained by US employers for skilled workers, or those who have at least a master’s degree from US universities, or those hired as instructors and researchers at universities or government research institutes.
The EB-5 investment visa was created by the 1990 Immigration Act to attract foreigners who invest at least $1 million to create or save at least 10 jobs for US workers, not counting the investor or his immediate family. The investment could be as low as $500,000 if it created jobs in designated high-unemployment or rural areas.
To make it easier for investors to qualify for the EB-5 visa the government later created a pilot program under which investments could be made into “Regional Centers”, investment vehicles managed by third parties who assume the responsibility of creating the required number of jobs. At the end of September 2012 President Obama signed a 3-year extension of the EB-5 Regional Center Pilot Program.
The pilot program and the extension were efforts at trying to make the EB-5 visa more appealing after a 2005 Government Accountability Office (GAO) report found that the program had failed to attract many investors due to “an onerous application process; lengthy adjudication periods; and the suspension of processing on over 900 EB-5 cases—some of which date to 1995—precipitated by a change in USCIS’s interpretation of regulations regarding financial qualifications.”
That sparked a series of changes by the US Citizenship and Immigration Service (USCIS) to make the EB-5 application process easier for foreigners seeking investment visas. The changes, including the creation of Regional Centers, succeeded in increasing the number of applicants from less than 800 in 2007 to over 3,800 by the end of the 2011 fiscal year.
Even so, the investment green card is overshadowed by the number of H-1B petitions filed by US employers seeking to hire foreign workers with theoretical or technical expertise to work as scientists, engineers, computer programmers or in other specialized occupations. The annual cap for H-1B petitions is 65,000. That cap opens at the start of the fiscal year on April 1 and is reached quickly, probably by about April 5, due to the overwhelming demand by US companies for skilled foreign workers.
Even after that H-1B cap is reached, foreign nationals holding a masters degree or higher from any US university can qualify for a second cap of 20,000 more slots. That too fills up quickly, by no later than early June.
That isn’t the end of the brain train. The USCIS exempts from both caps those who find jobs teaching or doing research at any college or university, or a nonprofit or hospital affiliated with any college or university, or with a nonprofit research organization or a governmental research organization.
In other words, it’s virtually impossible for a truly brainy foreigner to be excluded from obtaining legal residency in the US unless he’s a convicted felon or a suspected terrorist.
So while some Americans moan that green cards are being sold to all comers, in fact, at least an order of magnitude more are being given away to any foreigner who can provide the brainpower to keep the US functioning as the world’s leading technological and educational power. That explains the fervor with which about 600,000 Asian families a year send kids to school in the US. By earning a masters or a PhD in a US university they can anchor the entire extended family’s immigration while earning top dollars.
A testament to the value of these highly skilled people to any advanced society is the intense competition the US now faces from Canada, the UK, Australia, Italy, Spain and other European nations — as well as from China itself — to attract them. Ultimately, the nation who wins the competition for foreign brainpower will best be able to maintain the virtuous cycle of dynamism, prosperity and attractive power.