Republicans and Democrats can always agree on spending more money. Their default position is usually not to cover costs. But if they must, there’s one sure-fire political no-brainer: make foreigners pay. After all, they can’t vote. Next year, as Congress begins to take a closer – perhaps serious – look at the budget deficit, foreigners are going to be very tempting targets.
Increased visa fees for high-skilled Indian workers were the way to pay for border security this year. And yesterday, admittedly after threatening far more damage, Congress extended the increase by a year to help cover the health care costs of our 9/11 heroes. Most of the cost for the $4.3 billion bill will be covered in theory by a 2% excise tax on foreign providers of goods and services to the U.S. government. This creates problems of its own, not least of which, as incoming Chairman of the House Ways and Means Trade Subcommittee Kevin Brady (R-TX), and others, including the U.S. Chamber of Commerce, pointed out, is that it may be subject to challenge at the WTO:
What makes the visa provision so egregious is that it penalizes just the sort of high end investment we should want coming into this country.
Senator Gillibrand points out on her website that the 9/11 first responders health care bill “contains no new taxes on the American taxpayers or American businesses.” And lest one believe that Indian companies are caught up in this effort accidentally, she makes perfectly clear that it is the “outsourcing companies such as: Wipro, Tata, Infosys, Satyam,” all Indian, that are the bill’s intended target. Their crime, apparently, is that they are too competitive and too interested in the American market.
Thus, we have a convenient, one could say genius blend of fiscal cowardice and fear of international competition. Just the sort of thinking that is taking America from economically free to economically “mostly free.”