When it comes to immigration policy, President Obama has found his inner Machiavelli. He has devised an enforcement approach that at once disarms conservatives, delights labor unions, and minimizes bad feelings within the Hispanic community. All this might help him keep his job, but only by killing others'.
Last month, the administration announced a renewed crackdown against employers who hire undocumented aliens, notifying 1,000 of them to prepare for an audit raid. Under these raids, Immigration and Customs Enforcement inspectors descend upon companies and comb through their books, looking for irregularities.
Employees who don't have authorization to work or valid Social Security numbers are fired and sometimes arrested. And employers whose books show signs of under-the-table payments face fines, forfeiture, and jail.
The beauty of these raids, especially from the standpoint of PR within the Hispanic community, is that they seem more humane than the Bush administration's flashy workplace raids in which inspectors, TV cameras in tow, would crash a taqueria or a construction site, round up the workers, demand their papers, and arrest those who couldn't produce valid ones for future deportation. By contrast, a bunch of inspectors sitting around, quietly going through books doesn't seem that awful. But the impact of such silent raids on businesses and workers—both immigrant and American—is far more deadly.
For starters, because they don't require probable cause and are cheaper than the Bush raids, the Obama administration can conduct more of them. The Los Angeles Times reported even before the new crackdown that the number of employer raids had increased fourfold since 2008, and the fines collected from businesses grew sevenfold. Meanwhile, deportations were at a record high. This helps defuse accusations by enforcement-first conservatives that President Obama is soft on illegal immigrants. But the real purpose of the raids is, in the words of an Obama official, driving "unfair competition out of the market."
They target businesses in food production, information technology, financial services, construction, and other sectors regarded as "critical infrastructure and key resources" (and therefore, apparently, ripe for destruction). Chipotle, the Mexican fast-food chain, recently faced a multicity raid, forcing it to fire hundreds of workers, something that will hurt its financial results for the first time since it opened, diminishing its ability to expand. Meanwhile, American Apparel was forced to lay off more than a quarter of its factory workers after a 2009 audit, which it maintains has brought it to the brink of bankruptcy.
American Apparel might survive, but many small businesses such as San Diego's French Gourmet, a little eatery, and a West Coast franchise of Chuy's Mesquite Broiler, won't. French Gourmet's owner is facing $4 million in fines, 30 years in prison, and forfeiture of his restaurant building—all for the crime of having 12 undocumented aliens among his 120 employees. Likewise, Chuy's owners are looking at $10 million in fines and up to 83 years in prison. Serial rapists get milder punishments.
Beyond ruining the owners and undocumented workers, the raids will throw hundreds of Americans out of jobs when these restaurants shut down. Worse, future Chuy's Mesquites and French Gourmets, whose economics pan out only when they can keep some portion of their labor costs low, won't even come into existence. It is estimated that about 10 to 40 percent of workers in the restaurant business are undocumented, which means that 60 to 90 percent are not. Yet their jobs, too, will be jeopardized—at a time when unemployment has soared to 9.2 percent.
The Service Employees International Union (SEIU), which has been eying undocumented workers in the service sector to boost its flagging membership, broke ranks with the anti-immigration stance of its sister unions some years ago and has condemned the Obama raids. But the AFL-CIO, UAW, and others are quietly cheering them on. Incidentally, none of the unions, not even the SEIU, supports a guest worker program that would give unskilled immigrants legal options to work in the country, eliminating the root cause of the illegal problem.
Nor is the administration's jihad against foreign workers limited to the undocumented category. It also backed legislation by congressional Democrats to double the fee for H1-B visas—a temporary work permit for highly skilled workers—for companies whose work force contains 50 percent foreign workers. This mainly affects a handful of Indian companies, raising their visa costs by $250 million annually.
Administration apologists claim that these tactics are meant to create the political space for comprehensive immigration reform. But the president has made literally no effort to advance that objective. What he has advanced is a labor agenda under the guise of immigration policy.
The great hope from President Obama when he took office was that, having spent his formative years abroad, he'd understand—and use his bully pulpit to help the American public understand, too—that immigration is not a zero-sum game: Immigrants seeking a better life make America better off, just as his family made the countries where they lived better off. Instead, he has pandered to Republicans' parochialism and labor's protectionism to advance his own political prospects.
This is change, but there isn't much hope in it—for immigrants, American workers, or the American economy.
Shikha Dalmia is a senior analyst at Reason Foundation and a columnist for The Daily, America's first iPad newspaper, where this column originally appeared.