With a new year comes new resolutions. I’ve endeavored to spend more time visiting developing countries, finding opportunities in frontier lands, and exposing myself to more and more people in the global economic community. I’m also hoping that some of my fellow Americans resolve to get out a bit more.
Several days ago, several media outlets, including the New York Times, covered the story of a ski resort on the Vermont-Quebec border that has attracted hundreds of millions of dollars of foreign investment under the US EB-5 visa program.
The EB-5 program allows foreign nationals to invest $1 million in American businesses (or, in this case, $500,000 in a rural, high-unemployment area) in exchange for a provisional green card, contingent on ten jobs being saved or created.
The ski resort’s co-owner, Bill Stenger, has held court over perhaps the most aggressive use of the program to date, courting more than 500 investors to help him redevelop the place.
Yet this New York Times piece seems to poo-poo the idea, calling Stenger’s purported hold on the small community a “fiefdom” and asking him if his investors are “buying their way into the country”.
Of course, Nomad Capitalists know that the US is hardly the only place in the world investors get special treatment for pouring in cash. A laundry list of countries from EU states like Ireland, Spain, Portugal, and more, to rich Asian city-state of Singapore, to islands and mini-states on almost every continent offer the same, sometimes for less money.
Even Canada is bringing back it’s temporarily suspended investor program. Heck, Hong Kong’s program lets you put the required $1.3 million investment in a bank CD until you qualify for their version of permanent residence.
Yet some Americans, who have never visited another country let alone studied their economic policies, find the idea of “cutting in line” distasteful. It’s a first-world way of thinking based on an aversion to admitting that money opens doors not available to those without it.
For rich westerners, it’s distasteful to admit, so much so that it permeates throughout society. Try overtly bragging to your date this weekend that you own a Ferrari and see where it gets you. Tacky tacky.
While I’m not saying we should fall in love based on money (although plenty of good people in the world do), the reality in much of the world is that money really does open doors. People in places like Asia, the Middle East, and South America get that. The irony is many of those countries are becoming the new rich, while the US is deeply in debt and still facing high unemployment. Yet Americans, fixated with being a “rich country”, find it odd, even distasteful. (Of course, news that illegal aliens can stay with their legal spouses while applying for green cards is heralded by many of the same news outlets, NYT included). It’s the last form of acceptable xenophobia, even among those who champion immigration among people of lesser means and cleverly couched as some sort of economic sovereignty.
Why the affluent class from countries like China want the headaches associated with US green card status is largely beyond me, but I’ll cover that in a future post. As we move deeper into the 21st century, the playing field continues to be leveled as the US and western Europe remain mired in an economic mess.
The BRICs and other fast-developing players are beginning to assert their dominance and will create new opportunities for their citizens which will not only curb many of their desires to emigrate for the west but, in turn, less of an ability for nations like the US to take advantage of foreign wealth to bolster themselves.
Eventually, enough Americans may want to emigrate to the same countries today’s EB-5 seekers hail from. Competition for talent will only increase and staying mired in a bygone era of American (or European) dominance will lead to ruin.
It’s 2013, not 1913. I hope the west understands that they spurn foreign capital at their own peril.