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GUTIERREZ: Immigration America’s competitive advantage

Reforming immigration must focus on building up the American economy

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If we can fix our immigration system and design it for economic prosperity, our country will have a competitive advantage that can last a century. However, after listening to the president's July 1 speech, I am deeply concerned that this administration will squander the opportunity for a great American victory by using immigration for partisan purposes. The president's approach to immigration reform sounded disappointingly tactical and opportunistic: Put more "boots on the ground" at the border; persuade fellow Hispanics to vote for Democrats by continuing to promise reform; and blame the lack of any progress on Republicans. Ironically, President Obama emphasized the need to be "above politics" and not allow "special interests to hijack the process."

Having been intimately involved in the 2005 immigration-reform effort with Michael Chertoff, then secretary of Homeland Security, and a bipartisan group of senators, I can state that failure to pass the bill was the fault of both Republicans and Democrats. Immigration reform is a complex and intricate issue that demands compromise from both parties.

The president promised Hispanic Americans during his presidential campaign that he would "reform immigration" during his first year in office. However, it was evident by the content of his speech - his first major address on the subject - that this will not get done anytime soon. It appears that Hispanic Americans have begun to realize they are being played. Some poll findings, such as the one issued by Public Policy Polling on Friday, suggest a 15-point drop in support among Hispanics since January 2010 because of Mr. Obama's handling of the immigration issue.

The president spoke about the need to legalize most of the 11 million undocumented workers in the country. Like former President George W. Bush, I support this move in the interests of national security and for economic and humanitarian reasons as part of a comprehensive reform of our immigration systems. However, this administration needs to understand that dealing with the 11 million undocumented workers does not constitute comprehensive immigration reform. The problem of illegal immigration is the result of a broken legal-immigration system. Unless we address the core issues, we will continue to foster the conditions for future illegal immigration.

The question of how to design an effective legal-immigration system for the 21st century is less politically attractive for Democrats. For instance, the president said little about reforming our temporary-worker programs or other programs for future immigration. This is a clear nod to labor unions, which see temporary-worker programs as providing low-wage competition. So much for not allowing special-interest groups to hijack the process.

Reforming our legal-immigration system means dealing with two key issues: designing a temporary and seasonal immigration system that meets the immediate needs of our economy, and creating a permanent immigration system that strengthens our communities and our country's long-term competitiveness.

Temporary workers initially enter the United States for one to three years in order to fill specific jobs for which no U.S. workers are available. However, the current system is inflexible, complicated and so bureaucratic that it almost encourages employers to bend the rules.

One of the most common complaints among businesses relates to the H-1B visa. This is a three-year permit (one renewal) for highly educated and/or highly skilled workers and is used extensively by the high-tech industry. The annual quota is 65,000. During better economic times, that quota filled in days. In 2009, in the midst of the recession, the quota filled in about seven months, suggesting that the number of visas is still insufficient to meet employer needs. Democrats claim this is another example of "big business" importing "cheap labor"; in the meantime, more research-and-development centers are moving overseas, threatening U.S. dominance in critical fields such as information technology and medical research.

Seasonal work is a unique sector of the U.S. economy because the jobs are short-term and often strenuous. According to the Department of Agriculture's Agricultural Research Service, about 1 million to 2.5 million farm laborers are hired each year. In 2006, more than half were unauthorized. The reason is clear to any agricultural employer who has tried to abide by the law: the lengthy bureaucratic process is unrealistic and damaging to the needs of an effective agricultural industry. As long as this continues, growers will be faced with difficult choices: shut down the business, hire unauthorized laborers or move to another country. The Obama administration and a Democrat-controlled Congress have done nothing to alleviate this problem, which will continue until our system is fixed.

Between 350,000 and 500,000 new permanent immigrants enter the country annually. An estimated 10 percent come for employment reasons; the rest are driven primarily by family ties. While I am proud that family ties are the bedrock of our immigration system, we need more skills-based immigration. A logical solution would be to increase the number of visas that are employer-sponsored, empowering the private sector to choose the people who have the skills it needs. However, once again, the cries against big business importing cheap labor stand in the way of sensible immigration reform. Sweden, for example, implemented an employer-based system in 2008 that has proved highly successful.

Economic growth is a function of productivity and the labor force's size. Without an expanding work force with the skills we need at the right time, all growth must come from productivity - an extremely improbable feat. This is a problem that nations ignore at their own peril.

In spite of the worst economic crisis in a generation, statistics from the Department of Labor estimate that the U.S. economy will require 1.3 million additional workers each year over the next 10 years (assuming annual growth in gross domestic product of just 2.4 percent). The bulk of the population growth within the U.S. will come from the U.S.-born children of immigrants.

Every major country in the world will face demographic challenges in the future. Their populations are aging, and the countries are not producing enough workers to drive economic growth, let alone pay for the entitlements of retirees. The population of Russia is already declining. Forty percent of all Japanese will be over the age of 65 by 2040. China will face similar problems in a number of decades. (As others have said, they will get old before they get rich.) Spain, once known for its large families, has seen its fertility rate decline from 2.7 children per woman in 1977 to 1.4 children per woman in 2007; it has not equaled or exceeded the universal replacement rate of 2.1 children per woman since 1980. All of its growth has come from immigration.

Many of these countries already have resorted or will resort to immigration to ensure that their economies can grow in the future. Few of them have any meaningful experience integrating immigrants into their societies. The European Union is struggling to assimilate an immigrant population largely from the Middle East, and countries like Japan have virtually no experience with immigration. The U.S. - while often a reluctant but highly successful home for immigrants - has the most experience.

Fixing our immigration system will require leadership and vision. Again, if we get this right, it will give us a competitive advantage that will last a century.

Carlos M. Gutierrez is a former U.S. secretary of commerce and a scholar at the University of Miami's Institute for Cuban and Cuban-American Studies.

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