Mike Pence is one of truest free market believers in Congress. Exhibit A: When asked about immigration reform, he said, "It's a safe bet the Senate will produce a bad bill on any topic."
But that was a few weeks ago. On Wednesday (May 23rd) the congressman convincingly demonstrated that Senators are not the only ones who don't get it. At a Heritage Foundation speech that afternoon, Pence presented what he called "a rational middle ground…between amnesty and mass deportation" that would, in effect, reward illegal aliens for breaking the law.
Pence's plan is essentially the Kreible Foundation's guest-worker plan, which requires illegal immigrants to leave the United States and then apply for re-entry.
While acknowledging the essential nuttiness of expecting illegals to obediently trot off for a return trip to Mexico—oddly, no other country seems to be mentioned—Pence insists private sector competition can speedily vet re-entrants:
"Private worker placement agencies that we could call ' Ellis Island Centers' will be licensed by the federal government to match willing guest workers with jobs in America that employers cannot fill with American workers. U.S. employers will engage the private agencies and request guest workers. In a matter of days [my emphasis!], the private agencies will match guest workers with jobs, perform a health screening, fingerprint them and provide the appropriate information to the FBI and Homeland Security so that a background check can be performed, and provide the guest worker with a visa granted by the State Department. The visa will be issued only outside of the United States." [Renewing the American Dream: The Real Rational Middle Ground on Immigration Reform, May 23, 2006]
As usual with guestworker proposals, there is no mention of price—meaning that American wages will be undercut.
Nor, of course, is there any attempt to deal with the Fourteenth Amendment problem, meaning that guest workers will be having U.S. citizen "anchor babies."
But putting these fatal details aside, can Manpower, Inc., Kelly Services, and their clones—along with newly minted agencies spawned specifically in response to the guest-worker business—really manage a guest worker program? Can they complete the worker visa process "in a matter of days"?
Needless to say: no.
Capacity: Although the temp agency industry is larger and more sophisticated than it was when the "Kelly Girl" made her 1946 debut, it currently employs only about 4 million workers—or less than one-third the 12 million illegals expected to line up for visas. (Or maybe 20 million, if D.A. King and Bear Stearns turn out to be right).
Pence's dogmatic vision of employment-agency entrepreneurs filing the gap is fetching, but improbable. Agencies are particularly hard to start because fees are usually paid only after their workers have been on the job for 30 days, meaning that significant working capital is needed.
Conflicts of interest: Private employment agencies usually bill clients on the basis of how many individuals they've placed with them. Volume is crucial; attention to legal requirements is not. Already, the RICO lawsuit against carpet maker Mohawk Industries accuses the company of conspiring with employment agencies to hire undocumented immigrants from Mexico. Mohawk's employment agencies used forged Social Security cards and recruited workers on the border at Brownsville, Texas, the suit alleges.
Similar suits are pending against Tyson Foods and Wal-Mart.
Fraud was rampant when the last amnesty was run by the government. A guest worker program in private sector hands is a positive incentive for more.
Three private hiring centers similar to those in Pence's plan were put into place in southern California in the early 1990s. Their goal: get those unsightly gaggles of day laborers off the streets of Malibu. They may have cleared the streets, but a UC San Diego study found that the most successful of the three was (surprise, surprise!) the one that did not screen workers for legal status. In effect, private companies used government funds to help illegals find jobs.
A sign of things to come.
Background Checks: Sure, the internet makes them fairly cheap ($50) and speedy. But it's far trickier to do a criminal records check—no national database is available, and state and local prison systems vary as to how computerized they are.
(And for Homeland Security to make its database available to private employment agencies is an obvious security nightmare.) That leaves tedious, extensive interviews of former coworkers, neighbors, and associates.
Security checks—whether performed by Homeland Security or private firms—are unavoidably time-consuming and expensive…if done right.
This "rational middle ground" of a one-week amnesty turnaround is a silly and dangerous pipedream…or maybe a Pencedream.
Edwin S. Rubenstein (email him) is President of ESR Research Economic Consultants in Indianapolis.
