President Donald Trump would like to offer migrants who want to work in the US a “gold card,” akin to a green card, with one significant difference: the price tag. A gold card would cost $5 million, compared to government fees of $235 for a green card.
It’s a good idea, both from the standpoint of government revenue and for wealthy prospective immigrants. But the US would have to be careful not to foreclose other, more affordable ways for people to come and work and live in the country.
Trump estimates that the US could sell one million gold cards, which would give holders quick residency rights and a path to citizenship, family members included. That would bring in $5 trillion. He also suggests that many companies would buy them to bring in talented workers. Even if his estimates are overly optimistic, there is some real money on the table.
Under current law, there already is a path to residency and citizenship by investing in the US through the EB-5 program. After expenses are accounted for, and depending on details, the cost is about $1 million. That’s an 80% discount on a gold card, and meanwhile the government gets the benefit of new jobs added to the US economy.
The Trump proposal is intended to replace this program, which has been criticized for fraud and abuse. Charging a flat fee may be better than requiring a certain amount of investment, since there is no ambiguity as to whether the person has paid up and no incentive to concoct dubious job-creation schemes. The gold card may involve some of the same problems as the EB-5 program in terms of being an easy way for spies and potential terrorists to enter America, but it’s unlikely to make them worse, and at least the price would be higher.
Economists, including the late Nobel laureate Gary Becker, have long entertained the idea of selling the right to immigrate. It would help the US meet its fiscal obligations while offering residency to those who value it most, at least insofar as that concept is defined in monetary terms.
As usual, however, the devil is in the details. There is a good chance Trump’s proposal could work out well — and a chance it could severely damage the nation.
One worry is selection effects. The $5 million fee means the program would skew toward older people, and would probably also skew somewhat male. Neither of those biases is a problem if other methods of establishing residence remain robust. But will they?
With a gold card program, the government would have a financial incentive to limit other ways of establishing residency. You can get an O-1 visa or an H-1B, for instance, if you have a strong record of accomplishment or an interested employer with a proper priority and perhaps some luck. Neither of those options cost anything close to $5 million, even with legal fees. Not everyone with a spare $5 million can get an O-1, or a proper job offer, but still: At the margin, these options would compete with each other.
These other options are well-suited for getting young, talented people into the US, which is precisely the weakness of the gold card proposal. Ideally the US would expand these other paths, but with a gold card program they might be narrowed so the government can reap more revenue from sales of gold cards.
A young person entering the US on an O-1 — which is for “the individual who possesses extraordinary ability in the sciences, arts, education, business, or athletics” — may well start a company or do groundbreaking research. But the fiscal payoff from such successes can be decades down the road. The $5 million, in contrast, would be deposited in government coffers immediately.
The best-case scenario is that the US offers a gold card and expands (or at least does not limit) cheaper ways of getting into the country. Replacing the $1 million investment with a $5 million flat fee, on its own, seems like an upgrade. A lot of people who can afford $1 million can also afford $5 million. And due to America’s success in technology generally and AI in particular, the value of living and working in this country has risen considerably. It is realistic for an immigration fee to reflect that.
The less favorable scenario is that the federal government gradually eliminates or curtails cheaper options for establishing residency. America’s immigrant population would then skew older and wealthier. That may work out fine for the short run, but it is far from ideal for the longer term. In effect, a gold card program would serve as a form of deficit spending, favoring the current period over the more distant future.
In short, the concept of a gold card idea is a good one. But a lot depends on the execution.
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