America is having a fire sale. Why not sell wealthy foreigners the right to live here, too?
That's the notion behind a bill introduced last week by Republican
Senator Mike Lee of Utah and Democrat Senator Charles Schumer of New
York: Stoke demand for American homes by allowing foreign nationals to
buy them. In return, give foreigners the right to live here (although
not work here).
The price? At least $500,000 cash. It could be one piece of real
estate costing $500,000 or more, or several, of one would have to be
worth at least $250,000.
Presumably, this would help homeowners by boosting demand. "This is a
way to create more demand without costing the federal government a
nickel," Schumer told the Wall Street Journal.
And it would help the Street. Rather than have the big banks carry
all those non-performing mortgage loans on their books or be forced to
write them down, we'll just goose the housing market by selling off the
right to live in America.
And the measure wouldn't allow in the world's riff-raff, because
buyers would have to be rich enough to pay cash, and live here six
months a year without working.
Realtors love it. Says Glenn Kelman, CEO of Redfin, an online
brokerage firm, "when property values sag and this is a desirable place
to live, one of the simplest solutions is just to let more people in so
they can buy the homes."
In Seattle, where Kelman lives, housing prices have slumped -- as they
have all over America. But Vancouver, Canada -- just 140 miles to the
north -- is enjoying a housing boom because Canada allows foreigners to
buy their way into Canada, just as the Lee-Schumer bill would do here.
But wait a minute.
Rich foreigner buyers may be a boon to American homeowners looking to
sell, because those homeowners can't find Americans willing and able to
fork over as much money as the sellers would like.
But what about American home buyers -- many of them young, just
entering the market -- who would prefer low home prices that aren't bid
upward by rich foreigners? It's not altogether obvious why we should
favor American homeowners over American home buyers.
The visa-for-home swap proposal also comes at exactly the same
time the nation is actively closing its doors to foreigners who aren't
wealthy. Is this what America is all about?
Policy makers have tightened eligibility for entering the country
legally. Student visas are harder to obtain. Family members are waiting
years to become resident aliens. Green cards are in short supply.
Meanwhile, many states are doing whatever they can to make immigrants
-- mostly poor, but legal as well as illegal -- feel unwelcome. For
example, Alabama and Arizona allow police to demand "papers, please"
from anyone they suspect may be undocumented (read: anyone who looks
Hispanic). Alabama requires public schools to demand documentation from
parents of all children in K-12 programs.
The nation is expelling record numbers of undocumented workers. Over
the last year (from October 1, 2010 to October 31, 2011), almost 400,000
people were deported -- the largest number in the history of the Federal
Immigration and Customs Enforcement Agency. Annual deportations have
increased 400 percent since 1996.
Some of these people committed criminal acts in the United States but
a significant number simply overstayed their visas. Others had been in
America for decades, working and raising their families here. Some had
even been here legally but had no opportunity to defend themselves. A
recent report by my colleagues at the Berkeley Law School notes that
many immigrants "are pushed rapidly through the system without
appropriate checks or opportunities to challenge their detention and/or
deportation."