Statement for the Record of the Niskanen Center for the House Judiciary Committee Hearing on Markup of legislative proposals to comply with the reconciliation directive included in section 2002 of the Concurrent Resolution on the Budget for Fiscal Year 2022 (S. Con. Res. 14)

The Niskanen Center is a 501(c)(3) nonprofit think tank founded in 2014 and located in Washington D.C. The Niskanen Center appreciates the opportunity to comment on the reconciliation process. It commends any effort to include a pathway to legal status for certain undocumented immigrants in a reconciliation package. However, we do not believe that only undocumented immigrants already present in the United States should be qualified for relief. Therefore, we urge the committee to add provisions into the reconciliation package for others currently denied status. 

Specifically, we encourage the committee to include provisions that recapture previously unused green cards, ensure green cards which go unused in the future always roll over into the next year, exempt STEM graduates from U.S. universities from numerical caps, and provide adequate funding to U.S. Citizenship and Immigration Services to prevent future waste, reduce delays, and limit growth in visa backlogs. 

The United States has fostered a stellar reputation as a hub for opportunity and innovation throughout the world. Numerous studies show how immigrants have greatly contributed to the success of this country by launching major businesses and making new scientific discoveries.[1] In addition, immigrants pay taxes and reduce the average debt burden. Many of these individuals relied on the ability to obtain green cards in the United States promptly to further their businesses or continue their research. 

However, over the past three decades,  this system has increasingly broken down as the limited number of green cards available each year has remained constant, even as the U.S. population (and the number of qualified immigrants) has grown. 

The employment-based green card backlog alone surpassed 1.2 million applicants last year and is still growing rapidly. According to a report by the Congressional Research Service, the backlog is projected to double by fiscal year 2030 because two petitions are added to the queue for every new green card made available.[2] Growing backlogs mean growing wait times. For some people applying for a green card today, the expected wait time is more than a century.[3] This problem is exacerbated by the fact that the federal government has failed to award hundreds of thousands of green cards due to administrative challenges and, more recently, because of the COVID-19 pandemic. 

Without immediate action, green card backlogs are only going to get worse, significantly harming not only the United States’ economic growth and balance sheet but also the country’s reputation as the primary destination to start businesses or launch careers. 

Reconciliation offers an opportunity to restore the immigrant population in the United States to what Congress intended by recapturing visas and to retain top talent by exempting STEM graduates. And recapturing green cards should generate many billions of dollars in net revenue streams and economic activity. The addition of provisions related to legal immigration would help the United States maintain technological superiority, grow GDP, stimulate job growth, reduce government deficits, and bolster the solvency of Social Security. 

Recommendations

1). Recapture unused green cards.

Congress’s budgetary decisions have long relied on the assumption that the green cards it has authorized will actually be used. In other words, recapturing green cards restores the long-term fiscal outlook to what Congress had already provided. In addition, the budgetary effects of providing green cards to new immigrants are even larger than those of providing green cards to undocumented immigrants who are already here (since undocumented immigrants already pay taxes, unlike  people waiting abroad for a green card). 

The cumulative effect of green cards going unused year after year is a permanent drag on the U.S. economy. The labor force is left consistently smaller than Congress intended. Employers leave important positions vacant and suffer costly delays while they wait for green cards to become available. Others avoid the costly and uncertain process of sponsoring green cards altogether, at the cost of depriving their companies of much-needed talent. Many talented migrants seek opportunities outside the United States instead of waiting in the backlog. In short, the U.S. economy is constantly being deprived of the talents of a great many people who would otherwise be here. 

Recapturing unused green cards would reverse some of the damage with a one-off, temporary increase in legal immigration flows. It is critical to note that recapturing unused immigrant green cards is not a permanent solution and cannot significantly change long-run immigration flows or prevent future growth in green card backlogs. However, a much-needed temporary bump in immigration levels would provide substantial economic and fiscal benefits ,and would help restore the stock of immigrants in the United States to what Congress intended.

The Niskanen Center published a recent report estimating the economic and fiscal impact of recapturing green cards which went unused from 1992-2020.[4] In an update, those estimates were extended to include the many thousands of green cards that are expected to go unused in 2021 because of COVID-19.[5] This research shows that Congress could recapture over one million unused green cards in reconciliation if it adopted the recapture provisions from the U.S. Citizenship Act, modified to include any green cards that go unused in 2021. Doing so would contribute approximately $1.080 trillion to US GDP over ten years and increase long-term net revenue to federal, state, and local governments by approximately $463 billion. Less ambitiously, if Congress could recapture only unused employment-based green cards in reconciliation by amending the American Competitiveness in the 21st Century Act to extend its recapture provisions through 2021. Doing so would contribute $134 billion to GDP over a decade and have a long-term net fiscal impact of $152 billion. 

2). Prevent future green card waste.

Recapturing green cards which have already gone unused helps to undo the damage caused by green card waste that has already happened, but it doesn’t solve the issues that lead to green card waste in the first place. Recapturing green cards restores the long-term fiscal outlook (as it relates to immigration) to what the 101st Congress has already provided for. Still, it provides no assurances that the budgetary assumptions of the 117th Congress will hold. To do that, Congress must prevent future green card waste by ensuring that the immigration levels provided by statute are not consistently undershot. 

It could do this by ensuring that green card slots always roll over into the next year. Alternatively, it could require that USCIS and the State Department count green cards against the year they are made available, regardless of the precise date the immigrant enters the United States. This would also have the incidental benefit of ensuring that travel restrictions to protect public health do not affect the long-term number of legal immigrants in the United States.

3). Exempt STEM graduates of U.S. universities from numerical limitations on immigrant visas

While immigrants generally pay far more in taxes than they receive in benefits, immigrants with STEM degrees are among the most fiscally beneficial.[6] Nevertheless, the U.S. recruits far more STEM students who want to work and contribute to the United States after graduation than its immigration system has enabled it to retain. The STEM Optional Practical Training program has turned into a waiting room where tens of thousands of very highly-skilled STEM graduates of U.S. universities get on-the-job training in the U.S. At the same time, they wait in the hopes of securing a scarce nonimmigrant or immigrant visa before their OPT status expires. Many are turned away because they are subject to restrictive caps, even though an employer has sponsored them and they’ve shown their potential to make important contributions, make their teams more productive, create jobs, and innovate.[7] Retaining these valuable young people would be an economic and fiscal boon, help the United States keep its technological edge, and help reduce wait times for employment-based visas. 

Ideally, we would encourage the committee to add provisions to the reconciliation package to exempt all STEM graduates from the numerical limitations on H-1B visas and employment-based green cards. Notably, the former would provide additional revenue through fees. However, the committee could also consider exemptions only for advanced degree holders or only for PhDs. They could also limit the exemptions to certain visas (for instance, either only H-1B or only EB), or even for those with sponsoring employers in strategically important fields such as artificial intelligence. While a broader exemption is likely to maximize the resulting fiscal and economic benefits, even a small exemption would ensure that we do not lose some talented young graduates. While the other exemptions proposed by the House Judiciary Committee would be very valuable in themselves, the waiting period required would diminish the economic and fiscal effects. A separate exemption targeted toward STEM graduates without the required waiting time would improve the expected benefits. 

4). Adequately fund USCIS.

Even without the additional responsibilities that would fall on USCIS if Congress adopts immigration provisions in reconciliation, USCIS is already finding it difficult to keep on top of green card adjudication and its other responsibilities.  USCIS has over 7 million pending applications and petitions.[8] The fee-based agency also has twice faced a total shutdown due to revenue issues in recent years.  In addition to directly appropriating money to ensure that the agency has enough resources to process green cards before they are incinerated (and other visas), Congress can also require supplemental petition fees to bring in additional revenue.  

Conclusion

The Senate has only once passed immigration provisions in a reconciliation bill. In 2005, the Republican-controlled Senate passed a reconciliation bill that would recapture unused green cards and increase USCIS funding through supplemental petition fees. Though these provisions were ultimately not included in the final budget that passed the House, nobody challenged their inclusion on procedural grounds; no point of order was raised, and an amendment to remove the provision was voted down by an overwhelming bipartisan vote. This precedent, though not binding, is evidence that some immigration provisions may be fair game for reconciliation — especially provisions to recapture visas and increase USCIS revenue. 

We urge the committee to take this trillion-dollar opportunity.

[1] See Francine D. Blau and Christopher D. Mackie, The Economic and Fiscal Consequences of Immigration (Washington D.C.: National Academies Press, 2017).

[2] William A. Kandel, The Employment-Based Immigration Backlog,R46291, Congressional Research Service, March 2020.

[3]“Wait Time for Some Green Card Categories Could Be 100 Plus Years”, Boundless, November 26, 2019.

[4]Jeremy L. Neufeld, Lindsay Milliken, and Doug Rand, “Stop the Incinerator: The high cost of green card slots going unused and the benefits of recapturing them,” Niskanen Center, June 2021. 

[5]Jeremy L. Neufeld, “Recapturing Unused Green Cards is a Trillion Dollar Reconciliation Opportunity,” Niskanen Center, September 10, 2021. 

[6]Blau and Mackie, Economic and Fiscal Consequences. 

[7]Jeremy L. Neufeld, “Optional Practical Training (OPT) and International Students After Graduation: Human Capital, Innovation, and the Labor Market,” Niskanen Center, March 2019. 

[8]Citizenship and Immigration Services Ombudsman, “Annual Report 2021,” DHS, June 30, 2021.

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