Small Business and Immigration Reform
Politicians say they are looking after small business owners. Are they?
There’s one good thing about the collapse last week of the compromise immigration-reform bill: The nation will be spared (at least temporarily) the rhetoric of politicians trying to score points in the polling booth, rather than actually trying to solve problems. On one extreme there has been fear-mongering and thinly-veiled racism (send them all back to where they belong). On the other is a simplistic, romantic view of immigration that harkens back to the Warner Brothers melting pot melodramas of the 1930s (self-sacrificing immigrant parents have come here to work three jobs to put their brilliant, completely assimilated children through medical school).
Invariably, politicians of all stripes invoke the interests of small business owners. But are your interests actually being served? For now, the interests of businesses large and small have been sacrificed to something more important—political advantage. The Senate compromise would have provided three remedies, depending on length of residency-- ranging from a quick path to citizenship for undocumented workers who have been in the U.S. for five years to deportation for those here under two years. GOP leaders pulled the bill on Thursday night, after Democrats moved to close off debate and further amendments. The compromise might resurface after the Easter recess, or could be an early victim of election-year politics.
What do small business owners want to see? It depends on where they stand politically and economically—and, often, geographically. Acording to a study released last week by the National Federation of Independent Businesses, business owners are evenly split on whether to create an amnesty/guest worker program that would allow undocumented aliens who are employed to remain in the country.
Gary Roden, president of Aguirre Corp., a second-generation family contracting firm in Dallas, says that without immigrant labor, his industry would be in trouble. Roden, past president of Associated Builders and Contractors, a trade association representing 23,000 companies—mostly small, family-owned concerns—says firms like his depend on such workers. “If somehow undocumented workers would disappear, it would be a great blow,” he says. Independent contractors—many of whom started out as grunts on somebody else’s work crew—can’t find native-born Americans willing to take entry-level jobs in construction, he says. He blames that in part on parents and school counselors, who steer youths away from the field.
The problem is that, even as the recent torrid pace of construction and renovation slows with rising interest rates, the ABC membership still anticipates a labor shortage. In the next decade, Roden says, hundreds of thousands of seasoned construction workers will retire, while few native-born Americans are entering the field. ABC wants to fill the gap with a guest-worker program. In the NFIB poll, 62 percent favored a guest worker program that would grant temporary legal status to immigrant workers; 56 percent favor permitting immigrants to enter the U.S. for employment where “government-certified shortages exist.”
The compromise proposal, on its face, might have satisfied groups like the ABC, but the devil is in the details. As with current immigration law, the new proposals make employers responsible for ensuring that job applicants are properly documented—and would impose significant fines on companies that employ illegals. “We don’t think that small, family-owned businesses should be the enforcement mechanism,” says Roden.
Indeed, one thing that all small business owners seem to agree on is that they should not function as the auxiliary police force of the Immigration and Naturalization Service. “How does an employer know if the applicant has legitimate documents?” says Roden. To avoid the risk, he predicts, “You’ll have construction companies who will simply stop hiring Hispanics.”
Perhaps more harmful to reform is the widespread belief among business owners that enforcement is lax, which means it pays unscrupulous owners to cheat. Matthew Reindl, who runs Stylecraft Interiors in Great Neck, N.Y., is a believer in the melting pot and he plays by the rules. His grandfather came to the U.S. in 1930 and, after 20 years of working as a skilled cabinetmaker, opened his own company, which now installs custom cabinetry in offices. His grandson says he does everything by the books. “I look at the I-9s and send in the numbers,” he says. “But nobody ever checks.”.
He doesn’t want a medal for obeying the law. But what makes him livid is the prospect of immigration reform that offers amnesty not only to undocumented workers, but also to employers who have paid them off the books. There is nothing in the Senate proposal, he says, that addresses this part of the problem. “They get a free pass after years of cheating and of exploiting workers,” he says. “It’s a slap in the face for businesses that do the right thing.”
Reindl last year testified before a Congressional committee and pointed out how contractors in the New York area who employ illegals off the books are making it harder for legitimate competitors to survive. Stylecraft collects all appropriate taxes and picks up half of Social Security and Medicare. It also pays for worker's compensation and health benefits, while his rivals don’t. “Due to the unscrupulous employers that hire illegal aliens I do not know if Stylecraft Interiors can continue to survive,” he told members of the House Subcommittee on Immigration, Border Security and Claims last May. “Illegal immigration lowers my wage and that of my employees, too.” Like him, he says, his immigrant employees wonder why the U.S. government “refuses to enforce any laws when it comes to immigration.”
While he has no beef with the immigrants themselves, Reindl says, he favors the House Bill sponsored by James Sensenbrenner of Wisconsin—a bill that has been widely criticized as anti-immigrant. The measure would make undocumented aliens felons and, critics say, would result in mass deportations. Still, Reindl says, it does what he wants—levies fines as high as $40,000 on employers who hire illegals. His logic: “You don’t have to deport anybody. These people come here to work,” he says. “If they can’t find work, they will deport themselves.”
