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Trump’s Trumped Up Order: Rupture of the ‘American Dream’ Bubble
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Trump’s Trumped Up Order: Rupture of the ‘American Dream’ Bubble

President Donald Trump signed an executive order on Monday, June 22nd to suspend several categories of working visas until December 31, 2020. The “Proclamation Suspending Entry of Aliens Who Present a Risk to the US Labor Market Following the Coronavirus Outbreak” includes suspension of various working visas namely, H-1B, which is most favored by Indian I.T. professionals, H-2B, J and L visas along with F-1 and M-1 visas, untill the end of the year. The order has been in force since June 24th. This would mean that it will bar the entry of 219,000 people into the US, including 61,000 H-1B visa and L1 visa holders and their dependants on H4 and L2 visas. 

Apart from these working visas, the executive order also proposed changes in the working system of H-1B visas whereby workers with the highest salaries will be preferred so as to ensure the movement of highly skilled officials in the country. 

Although President Trump has made these decisions citing the global pandemic and increased unemployment that it has resulted in, he carefully managed to seize this opportunity as a way to seek a second term at his Oval Office. Even in January 2017, when Trump came to power, he hinted that the low-cost workers were hampering the nation’s economy and in 2018, talked about reforming the broken H-1B visa system. In his latest executive order extending the ban, Trump said that while under normal circumstances,

properly administered temporary worker programs can provide benefits to the economy…[u]nder the extraordinary circumstances of the economic contraction resulting from the Covid-19 outbreak, certain non-immigrant visa programs authorizing such employment to pose an unusual threat to the employment of American workers.

According to him, these reforms were essential to protect domestic workers who had been impacted due to a contraction in the economy in the wake of the Covid-19 pandemic. On July 7th, the new Department of Homeland Security issued another rule, prohibiting international students from returning to or remaining in the United States if their colleges adopt an online-only instruction model for the fall. 

In April too, Trump passed a temporary order preventing new immigrants for a period of 60 days and has now extended the ban till 31st December. The new 2020 Spring Agenda further suggests the upcoming changes in visa norms of the US, and it does not bode well for India. 

Recent Immigration Policy Reforms 

The visa lottery system is scrapped, and it will be granted to only those employees with the highest salaries to ensure entry of the best talent into the U.S.

  • The visa lottery system is scrapped, and it will be granted to only those employees with the highest salaries to ensure entry of best talent into the U.S.
  • The H4 EAD (Employee Authorisation Document) which allowed spouses of H-1B visa holders to be employed in the US has been removed. 
  • The body also proposed to amend and revise the Optional Practical Training (OPT) option with enhanced supervision and compliance to prevent the student visa holders from abusing the OPT program.
  • L visas through which multinational companies could move their employees to U.S. offices are now suspended.
  • Additionally, J-1 visas encouraging educational and cultural exchanges and H-2B visas permitting temporary workers in non-agricultural industries to work in the U.S. also stand suspended till December. 
  • The U.S. Immigration and Customs Enforcement (ICE) stipulated that there shall be a fixed period of time for admission and extension of stay for students, there was no such obligation for F-1 visa holders prior to the visa policy changes. But, now the revocation of F-1 visa policy change has come as a relief to Indian students. 

The Visa Saga: The Impact on India

The biggest beneficiaries of the US H-1B visa regime are the Indian I.T. companies as India has always grabbed the lion’s share of the total number of visas issued every year. As of April 1, 2020, the US Citizenship and Immigration Services (USCIS) had received about 2.5 lakh H-1B work visa applications, according to official data. Indians had applied for as many as 1.84 lakh or 67 percent of the total H-1B work visas for the current financial year ending March 2021. In these situations where three out of every four H-1B visa holders are Indian, this ban will have a horrifying effect on H-1B visa applicants from top Indian IT services firms including TCS, Wipro, Infosys, Cognizant. Nearly 3-4 lakh H-1B visa holders are currently being employed by top tech firms in India and more than 60% of engineers in the Bay area are H-1B visa holders. The proclamation of a work visa will cost Indian IT firms Rs. 1,200 crore and have a marginal 0.25-0.30 percent impact on their profitability. Moreover, analysts of the Indian IT industry fear that a long-term ban on such visas will hurt the project deliverability of Indian IT services firms because of a shortage in the talent. 

  • For those who do not have valid non-immigrant visas as of June 23, 2020 and are not in the US will be disallowed to enter the country before December 31, 2020.
  • Workers engaged in essential services in the food sector have been given some reprieve, and the consular officer of immigration services shall decide their entry.
  • All the visa holders mentioned above, and their children or spouses already present in the US will not be impacted by this order.
  • Also, the H-1B visa applicants who do not yet hold a valid visa will have to wait till the end of the fall or till the ban expires.

Immigrants: Holders of the U.S. Economy 

Highly skilled immigrants are the key to a strong economy, and hiring immigrants led the United States to get the lead in STEM-related jobs for which most of these immigrants are recruited. However, the Trump administration counters the facts by arguing H1B and other work immigrants visa holders cost U.S. workers jobs while shrinking the U.S. economy and benefiting from taxes paid by U.S. citizens.

The claims that immigrants cost U.S. workers’ jobs prove to be just opposite when the data of contribution of H-1B visa holders are analyzed. The analysis concludes that every 1 additional H-1B visa awarded to a state was associated with the creation of 2 more jobs for U.S.-born workers. Also, with a perusal on the actual impact of these workers on the economy, it can be comprehended that the immigrants are not getting benefited. Apart from this, the contribution they are making to the U.S. economy cannot be neglected.

  • The H1B workers contribute more than $27.1 billion per year in the form of the amount charged for Social Security and Medicare benefits (which they may not be able to benefit from) 
  • H1B visa holders spend $76.7+ billion at U.S. businesses annually
  • 74% of spending ($57.1 Billion) by H1B visa holders goes directly to local businesses with their communities
  • H1B visa holders invest more than $12 billion into U.S. businesses annually 

Moreover, the order primary takes on I.T. industry, but it can be noted that the unemployment level of skilled talent is over 10 percent in the U.S., while the level for tech folks is less than three percent. Such knee-jerk decisions to overcome the current job problem will in no way prove to be a solution to the rising unemployment level instead can lead to the downfall of the U.S. industries. NASSCOM states that many U.S. companies will face problems in the process of recovery to full economic strength by retrograde moves like this amid pandemic. Besides, the morale of the affected professionals is a point of concern as they will look for opportunities in other growing destinations like Canada and Australia. 

Conclusion

Such a policy decision though can help swing the election verdict in favor but undercut the ability of a stable destination to create job opportunities and further inhibit its services. Being able to attract the most talented hands through to its immigration policies has made America more resilient. Therefore, it seems that the Trump administration has ignored the long-term repercussions that the ongoing visa policy changes can lead to. 

The immigration policies, as well as trade and economic cooperation in technology and innovation sectors, are essential to India – US partnership. Hence, suspension of visas at this critical juncture will not only rupture the “American Dream” of Indians, but the United States which aims to protect livelihood will end up shrinking of its economy due to the political aspirations of Trump.

 

Prateek Khandelwal is a second-year student pursuing B.B.A., LL.B. (Hons.) from Chanakya National Law University, Patna, India.

Falguni Sharma is a second-year student pursuing B.A., LL.B. (Hons.) from National Law University, Jodhpur, India.

Suggested citation: Prateek Khandelwal and Falguni Sharma, Trump’s Trumped Up Order: Rupture of “American Dream” Bubble, JURIST – Student Commentary, July 29, 2020, https://www.jurist.org/commentary/2020/07/khandelwal-sharma-trump-immigration-policy/.

This article was prepared for publication by Brianna Bell, a JURIST Staff Editor. Please direct any questions or comments to her at commentary@jurist.org


Opinions expressed in JURIST Commentary are the sole responsibility of the author and do not necessarily reflect the views of JURIST's editors, staff, donors or the University of Pittsburgh.