The sister of Jared Kushner, the first son-in-law appointed by the President to solve all the world’s problems, was trying to raise money in China for a Kushner family real estate venture in Jersey City, New Jersey. A tagline told the potential investors, “Invest $500,000 and immigrate to the United States.” This was a reference to the EB-5 visa program.

That program provides a way for foreigners to get a green card if they invest half-a-million dollars in an American project that will create at least ten new jobs in the United States. Although the program is available to many industries and enterprising startups, real estate development has garnered the most attention for getting such foreign investments. And although investors from around the world can participate in the program, most of the EB-5 money has come from China.

This program is supposedly being re-evaluated, as it should be. At first glance, we seem to be selling visas; on the other, American jobs are being created because of the program, or so it is said. But surely there should be more questions. For example, are these investors the kind of immigrants we want? They must have an impressive set of skills because they apparently have made enough money to pony up $500,000. On the other hand, they have amassed fortunes in China, a communist country that often depends on cronyism and corruption. It must take great ability to navigate and succeed in that society, but will those skills further the America we want?

Most of all, however, we should question how many jobs are actually created by the program. The spokeswoman for the EB-5 Investment Coalition (Isn’t it amazing the diverse array of lobbying groups this country creates? Does this Coalition count as part of the swamp that was supposed to be drained?) states that “job creation is the focus of the program” and that the “program has helped create at least 175,000 jobs across the country.” I suggest that you get out the grains of salt before you accept that number.

Assume I have a potential project that would create ten jobs, but I need $500,00 for it. You have $500,000 to invest. I ask you to lend me the money, and I say I will pay you one percent interest. You say that is not enough. I offer you two, then three percent and so on. Let’s say that you say you will lend me the money at four percent. I then have to decide whether at that interest rate the project makes financial sense for me.

Instead, assume I can utilize the EB-5 program and go to a Chinese investor. This foreign investor gets two considerations for his money—the interest rate and the visa. This means I can offer him a lower interest rate than I have to offer you, perhaps instead of the four percent offered to you, only one percent for the Chinese rich guy who desires to get into the United States.

If I take the Chinese investment, ten jobs are created, but they also would have been created if I had borrowed the money from you at four percent. Under these circumstances, it is misleading to say that the visa program has actually created any jobs. Instead, what has been created are not jobs, but greater profits for me since I can borrow the money at lower interest rates because of the EB-5 program. Whenever I could have borrowed the money without the visa incentive, albeit with a higher interest rate than with the visa, the government in the EB-5 program is not creating jobs, only creating more money for the developer. And, in essence, the government has taken money from those who would have lent the money at four percent.

Of course, the interest rate the developer might have to pay in a free market might be so high that the developer abandons the project as uneconomical, and then the jobs are not created. Only in this situation–if the developer could borrow the money under the EB-5 program at a rate that allows the project to proceed when he could not otherwise borrow at a workable rate–has the visa giveaway program actually created jobs. In all other circumstances, it is a government program that does nothing more than increase the wealth of some developers. In other words, it is a government handout to the rich through allowing immigration of a select group of other rich people.

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