```

[Senate Hearing 107-588]
[From the U.S. Government Publishing Office]

                                                        S. Hrg. 107-588

       U.S.-MEXICO MIGRATION DISCUSSIONS: A HISTORIC OPPORTUNITY

=======================================================================

                                HEARING

                               before the

                       COMMITTEE ON THE JUDICIARY
                          UNITED STATES SENATE

                      ONE HUNDRED SEVENTH CONGRESS

                             FIRST SESSION

                               __________

                           SEPTEMBER 7, 2001

                               __________

                          Serial No. J-107-38

                               __________

         Printed for the use of the Committee on the Judiciary

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                            WASHINGTON : 2002
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                       COMMITTEE ON THE JUDICIARY

                  PATRICK J. LEAHY, Vermont, Chairman
EDWARD M. KENNEDY, Massachusetts     ORRIN G. HATCH, Utah
JOSEPH R. BIDEN, Jr., Delaware       STROM THURMOND, South Carolina
HERBERT KOHL, Wisconsin              CHARLES E. GRASSLEY, Iowa
DIANNE FEINSTEIN, California         ARLEN SPECTER, Pennsylvania
RUSSELL D. FEINGOLD, Wisconsin       JON KYL, Arizona
CHARLES E. SCHUMER, New York         MIKE DeWINE, Ohio
RICHARD J. DURBIN, Illinois          JEFF SESSIONS, Alabama
MARIA CANTWELL, Washington           SAM BROWNBACK, Kansas
JOHN EDWARDS, North Carolina         MITCH McCONNELL, Kentucky
       Bruce A. Cohen, Majority Chief Counsel and Staff Director
                  Sharon Prost, Minority Chief Counsel
                Makan Delrahim, Minority Staff Director

                            C O N T E N T S

                              ----------                              

                    STATEMENTS OF Committee MEMBERS

Brownback, Hon. Sam, a U.S. Senator from the State of Kansas.....     8
Hatch, Hon. Orrin G., a U.S. Senator from the State of Utah......     6
Kennedy, Hon. Edward M., a U.S. Senator from the State of 
  Massachusetts..................................................     1
Leahy, Hon. Patrick J., a U.S. Senator from the State of Vermont.    73
Specter, Hon. Arlen, a U.S. Senator from the State of 
  Pennsylvania...................................................    10

                               WITNESSES

de Castro, Rafael Fernandez, Professor and Director, Department 
  of International Studies, Instituto Tecnologico Autonomo de 
  Mexico, Mexico City, Mexico....................................    14
Deffenbaugh, Ralston H., Jr., President, Lutheran Immigration and 
  Refugee Service, Baltimore, Maryland...........................    56
Donohue, Thomas J., President and Chief Executive Officer, U.S. 
  Chamber of Commerce, Washington, D.C...........................    30
Norquist, Grover, President, Americans for Tax Reform, 
  Washington, D.C................................................    51
Moore, Stephen, Senior Fellow, Cato Institute, Washington, D.C...    62
Papademetriou, Demetrios, Co-Director, Migration Policy 
  Institute, Washington, D.C.....................................    11
Sweeney, John J., President, AFL-CIO, Washington, D.C............    24
Yzaguirre, Raul, President, National Council of La Raza, 
  Washington, D.C................................................    38

 
       U.S.-MEXICO MIGRATION DISCUSSIONS: A HISTORIC OPPORTUNITY

                              ----------                              

                       FRIDAY, SEPTEMBER 7, 2001

                              United States Senate,
                                Committee on the Judiciary,
                                                   Washington, D.C.
    The Committee met, pursuant to notice, at 10:08 a.m., in 
Room 106, Dirksen Senate Office Building, Hon. Edward M. 
Kennedy, presiding.
    Present: Senators Kennedy, Hatch, Specter, and Brownback.

  OPENING STATEMENT OF HON. EDWARD M. KENNEDY, A U.S. SENATOR 
                FROM THE STATE OF MASSACHUSETTS

    Senator Kennedy. We will come to order, if we could, 
please.
    It is a privilege to chair this hearing on the important 
issue of U.S.-Mexico migration. I commend President Bush and 
President Fox for their leadership and their commitment to work 
together to address this critical challenge. Few issues so 
profoundly affect the ties between our two countries.
    I look forward to the testimony of our distinguished 
witnesses, and I commend Dr. Papademetriou and Dr. Fernandez de 
Castro, representing the U.S.-Mexico Migration Panel, whose 
insightful report--``U.S.-Mexico Migration: A Shared 
Responsibility''--has provided both of our governments with a 
basic framework for the migration discussions.
    We know there is broad support in our country today for 
fair and balanced immigration reform that will benefit both 
immigrant workers and their families, and employers as well. I 
am pleased to see labor and business, conservative and liberal 
groups, faith-based and secular groups here together in support 
of comprehensive immigration reform. My hope is that we will be 
able to achieve lasting and long overdue reforms, and I look 
forward to working with all of you in the weeks ahead.
    America has a proud tradition of welcoming immigrants. 
Throughout our history, immigrants have contributed 
significantly to the strength of our country, and we owe a 
great deal to Mexican nationals and immigrants from throughout 
the world.
    Today, many industries depend overwhelmingly on immigrant 
labor. Yet, many immigrants are undocumented. They live in 
constant fear of deportation and are easy targets of abuse and 
exploitation by unscrupulous employers. Others, seeking to work 
temporarily in the U.S., risk danger and even death to cross 
our borders.
    The status quo is unacceptable. It must be replaced with 
sound immigration reforms that provide a manageable and orderly 
system where legality is the prevailing rule.
    These are complex issues, and they deserve careful 
consideration and debate. But they also demand immediate 
attention. We should not have to wait until next year. We have 
delayed too long already in achieving these long overdue 
reforms.
    Last month, many of us joined in supporting a series of 
principles that we hope President Bush and President Fox will 
consider as they discuss a fair and balanced immigration 
proposal.
    First, immigrant families must be reunited as quickly and 
humanely as possible. Family unity has always been a 
fundamental cornerstone of America's immigration policy. 
Despite this fact, over one million deserving individuals--
spouses and children of permanent residents, have endured years 
of painful and needless separation. Millions more are waiting 
for action on their applications for employment visas.
    Two options that merit careful consideration here are 
significantly raising the current family and employment visa 
ceilings, and exempting Canada and Mexico from these ceilings.
    We should also remove other obstacles in our current 
immigration laws that are separating families. Last night the 
Senate passed an extension of 245(i), which will allow 
immigrants to remain in the United States while their 
applications are processed. This is an important down payment 
towards reuniting families and ensuring economic security and 
stability for individuals and American businesses.
    I commend President Fox's support for a legalization 
program, and I urge the administration to develop a responsible 
proposal on this issue. Adjusting the status of these long-term 
residents can provide employers with a more stable workforce 
and help to improve the wages and working conditions of all 
workers. No reform will be complete without an adjustment 
program.
    We should create a fair, uniform set of procedures for all 
qualified immigrants, not just Mexican nationals. We should 
seize this opportunity to create an earned adjustment program 
that benefits all deserving immigrants. In addition, we should 
also develop an effective temporary worker program to allow 
migrants, including those who recently arrived, to work 
temporarily in the United States. However, a temporary worker 
program cannot stand alone. It must be developed in conjunction 
with an earned legalization and family unity priority.
    We must also ensure that the temporary worker program 
avoids the troubling legacy of exploitation and abuse under 
past guest worker programs. A temporary worker program should 
not undermine the jobs, wages, or worker protections of U.S. 
employees. Individuals in the program deserve the same labor 
protections as those given to U.S. workers.
    A temporary worker program should also give participants an 
opportunity to become permanent residents, and eventually 
citizens, if they desire to do so. Also, temporary workers 
should not be forced to choose between their job and their 
families. Families should remain united while a program 
participant works in this country.
    We all agree that our borders must be safe and secure. Over 
the last 5 years, Congress has invested millions of dollars to 
vastly increase the number of border patrol agents, improve 
surveillance technology, and install other controls to 
strengthen border enforcement, especially at our Southwest 
border. Too often, this border enforcement strategy has 
diverted migration to the most inhospitable desert and mountain 
areas, causing increasing deaths due to exposure to the harsh 
conditions. Desperate migrants are increasingly being drawn to 
criminal smuggling syndicates, bringing increased violence to 
border patrol agents, border communities, and migrants 
themselves.
    The status quo is unacceptable. The chief cause of 
fatalities and safety hazards at our borders is the poor fit 
between our immigration policies and reality. Back and forth 
migration has been going on for more than a century. 
Substantially legalizing this flow will enhance border safety 
by permitting orderly entry through regular ports of entry and 
by shutting down smugglers' markets.
    Finally, we must restore due process protection to long-
term residents affected by the 1996 immigration laws and reform 
the structure of the INS. We should also review other 
provisions of the immigration law that affect American 
businesses and labor, especially the effectiveness of employer 
sanctions. Many of us are concerned that the current system of 
employer sanctions is unworkable for business, results in 
discriminatory practices, and fails to address the worst abuses 
by unscrupulous employers.
    We have a unique opportunity in the weeks ahead to reform 
our current immigration system, and create policies to reaffirm 
our Nation's commitment to family unity, fundamental fairness, 
economic opportunity, and humane treatment. I look forward to 
working with President Bush, President Fox, and my colleagues 
here on the Committee and in the Congress to achieve these 
lasting reforms.
    [The prepared statement of Senator Kennedy follows:]

 STATEMENT OF HON. EDWARD M. KENNEDY, A U.S. SENATOR FROM THE STATE OF 
                             MASSACHUSETTS

     ``U.S.-MEXICO MIGRATION DISCUSSIONS: AN HISTORIC OPPORTUNITY''
    It is a privilege to chair this hearing on the important issue of 
U.S.-Mexico migration. I commend President Bush and President Fox for 
their leadership and their commitment to work together to address this 
critical challenge. Few issues so profoundly affect the ties between 
our two countries.
    I look forward to the testimony of our distinguished witnesses. I 
commend Dr. Papademitriou and Dr. Fernandez de Castro, representing the 
U.S.-Mexico Migration Panel, whose insightful report--U.S.-Mexico 
Migration: A Shared Responsibility--has provided both our governments 
with a basic framework for the migration discussions.
    We know there is broad support in our country today for fair and 
balanced immigration reforms that will benefit both immigrant workers 
and their families, and employers as well. I am pleased to see labor 
and business, conservative and liberal groups, faith-based and secular 
groups, here together in support of comprehensive immigration reform. I 
am encouraged that John Sweeney, Raul Yzaguirre, Tom Donohue, and 
Grover Norquist are on the same side of this effort. I also commend 
Ralston Deffenbaugh and Stephen Moore, two consistent leaders in 
support of immigrants. My hope is that we will be able to achieve 
lasting and long-overdue reforms, and I look forward to working with 
all of you in the weeks ahead.
    President Fox's visit is an excellent opportunity to reform our 
immigration policies to reflect the core values of family unity, 
economic opportunity, and fundamental fairness. America has a proud 
tradition of welcoming immigrants. Throughout our history, immigrants 
have had a critical role in the Nation's economy, contributing 
significantly to the strength of our country. We owe a great deal to 
the hard work and the many contributions by Mexican nationals, and by 
many other immigrants from throughout the world.
    Today, many industries, particularly the agricultural, retail, and 
service sectors, depend overwhelmingly on immigrant labor. These 
workers enrich our Nation and improve the quality of our lives. Yet, 
many of them are undocumented. They live in constant fear of 
deportation and are easy targets of abuse and exploitation by 
unscrupulous employers. Others, seeking to work temporarily in the 
U.S., risk danger and even death, to cross our borders.
    The status quo is not acceptable. It must be replaced with sound 
immigration reforms that provide a manageable and orderly system where 
legality is the prevailing rule. We need immigration policies that not 
only reflect current economic realities, but also respect our heritage 
and history as a Nation of immigrants.
    These are complex issues, and they deserve careful consideration 
and debate. But they also demand immediate attention. We should not 
have to wait until next year. We have delayed too long already in 
achieving these long overdue reforms.
    Last month, many of us joined in supporting a series of principles 
that we hope President Bush and President Fox will consider as they 
discuss a fair and balanced immigration proposal. I look forward to 
discussing these principles with our witnesses here today.
    First, immigrant families must be reunited as quickly and humanely 
as possible. Family unity has always been a fundamental cornerstone of 
America's immigration policy. Despite this fact, millions of deserving 
individuals are awaiting immigrant visas in order to reunite with their 
families. Over 1 million are the spouses and children of permanent 
residents, who have endured years of painful and needless separation. 
Millions more are waiting for action on their applications for 
employment visas.
    Last year, Congress began to acknowledge the predicament of 
immigrant families. We enacted limited relief for certain spouses and 
children of permanent residents. This was an important first step, but 
the relief did not address the most pervasive problems. Working out an 
effective solution to the family and employment visa backlogs should be 
a major part of any reform proposal.
    Two options that merit careful consideration here are significantly 
raising the current family and employment visa ceilings, and exempting 
Canada and Mexico from these ceilings.
    We should also remove other obstacles in our current immigration 
laws that are separating families. Strict support requirements often 
prevent members of working immigrant families from receiving permanent 
residence. We should allow responsible discretion, where the evidence 
indicates that an immigrant is not likely to become a public charge. 
The bars to inadmissibility based on unlawful presence are also 
excessive. They can result in immigrant families being separated for up 
to ten years and should be repealed. At a minimum, immediate family 
members should be exempt from these prohibitions, and more generous 
waivers should be made available for other deserving immigrants. In 
addition, Section 245(i) should be extended, so that immigrants can 
remain in the United States while their applications are processed.
    I commend President Fox's support for a legalization program, and I 
urge the Administration to develop a responsible proposal on this 
issue. No reform will be complete without an adjustment program. Hard-
working immigrants living in the United States contribute to the 
economic growth and prosperity of our nation. The Bureau of Labor 
Statistics predicts that by 2008, America will have 5 million more jobs 
than there will be individuals to fill them. Immigrant workers are, and 
will continue to be, essential to the success of many American 
businesses.
    These long-term, tax-paying immigrants should be allowed to apply 
for earned adjustment of their status. These long-term residents can 
provide employers with a more stable workforce and help to improve the 
wages and working conditions of all workers.
    All similarly situated, long-time, hard-working residents should 
have the same opportunity to become permanent members of our community. 
We should create a fair, uniform set of procedures for all qualified 
immigrants. Many of today's undocumented workers are Mexican 
nationals--but many others are from Central and South America, Asia, 
Africa, and Europe. We should seize this opportunity to create an 
earned adjustment program that benefits all deserving immigrants.
    In creating such a program, we can borrow from time-tested 
provisions in our current immigration laws, such as registry. At a 
minimum, eligible immigrants should be long-time residents who are 
persons of good moral character, have no criminal or national security 
problems, and are eligible to become U.S. citizens.
    The wider availability of legal status for Mexicans and other 
nationals has important foreign policy ramifications. Immigrants 
earning permanent legal status are likely to receive higher wages and 
send back more funds to their native lands. Recent data indicate that 
Mexicans in the U.S. send more than $8 billion dollars a year to their 
families and communities in Mexico. The remittances sent by Central 
American immigrants have contributed substantially to the vital 
economic recovery and reconstruction of that region. These remittances 
are a critical source of funding for development initiatives that will 
profoundly improve the lives of persons in those countries, encourage 
them to remain at home, and contribute to the well-being of their 
nations and our nation.
    In addition, we should also develop an effective temporary worker 
program to allow migrants to work temporarily in the United States. Any 
such program should also benefit migrants who have recently arrived. 
However, a temporary worker program cannot stand alone; it must be 
developed in conjunction with earned legalization and family unity 
priorities.
    We must also ensure that the temporary worker program avoids the 
troubling legacy of exploitation and abuse under past guest worker 
programs. A temporary worker program should not undermine the jobs, 
wages, or worker protections of U. S. employees. Individuals in the 
program deserve the same labor protections as those given to U.S. 
workers, including the right to organize, the right to change jobs, and 
the protection of their wages, hours, and working conditions. Anything 
else would not only subject migrants to abuse, but would also undermine 
the wages and working conditions of U.S. workers.
    A temporary worker program should also give participants an 
opportunity to become permanent residents, and eventually citizens, if 
they desire to do so. Our current immigration laws already provide 
high-skilled temporary workers with this option. The same standards 
should apply to any temporary worker program for other essential 
workers. Also, temporary workers should not be forced to choose between 
their job and their family. As in the current temporary visa program 
for high-skilled workers, families should remain united while a program 
participant works in this country.
    We all agree that our borders must be safe and secure. The issue is 
whether our current enforcement policies are effective. Over the last 
five years, Congress has invested millions of dollars to vastly 
increase the number of border patrol agents, improve surveillance 
technology, and install other controls to strengthen border 
enforcement, especially at our southwest border. Too often, this border 
enforcement strategy has diverted migration to the most inhospitable 
desert and mountain areas, causing increased deaths due to exposure to 
the harsh conditions. Desperate migrants are increasingly being drawn 
to criminal smuggling syndicates, bringing increased violence to border 
patrol agents, border communities, and the migrants themselves.
    The status quo is unacceptable. The chief cause of fatalities and 
safety hazards at our borders is the poor fit between our immigration 
policies and reality. Back and forth migration has been going on for 
more than a century. Substantially legalizing this flow will enhance 
border safety by permitting orderly entry through regular ports of 
entry and by shutting down smugglers' markets.
    Controlling our borders is a shared responsibility. Mexican and 
U.S. law enforcement authorities should continue to develop joint 
strategies and expand the recently announced coordinated operations. 
Effective joint efforts on the border will save lives, break up 
smuggling rings, and build new confidence and trust between our 
nations.
    Sound reasons may exist for beginning the reform of our migration 
policy with a temporary worker program for Mexico, but we should do so 
with a view to expanding it quickly to equally deserving people of 
other nations. Our closest neighbors in the Caribbean and Central 
America should be among the first to benefit from this expansion.
    Finally, we must restore due process protection to long-term 
residents affected by the 1996 immigration laws and reform the 
structure of the INS. We should also review other provisions of the 
immigration law that affect American businesses and labor, especially 
the effectiveness of employer sanctions. Many of us are concerned that 
the current system of employer sanctions is unworkable for business, 
results in discriminatory practices, and fails to address the worst 
abuses by unscrupulous employers.
    We have a unique opportunity in the weeks ahead to reform our 
current immigration system, and create policies to reaffirm our 
Nation's commitment to family unity, fundamental fairness, economic 
opportunity, and humane treatment. I look forward to working with 
President Bush, President Fox, and the Congress to achieve these 
lasting reforms.

    Senator Kennedy. Senator Hatch?

STATEMENT OF HON. ORRIN G. HATCH, A U.S. SENATOR FROM THE STATE 
                            OF UTAH

    Senator Hatch. Thank you, Mr. Chairman. I want to commend 
you for holding this hearing today. This is a very important 
hearing, and I believe it will get us on the track of doing 
what really has to be done in these areas.
    I believe that the discussion we are engaging in today is 
very timely and very appropriate--appropriate in the sense 
that, as President Bush has recently remarked, the issue of 
immigration and immigration reform is a complex one. Because it 
is complex, I applaud the administration's careful 
consideration with regard to a comprehensive plan of action. 
Resolving the issues at hand requires reflective thought and 
discussion. These witnesses before us can, and I am sure will, 
offer valuable viewpoints to this Committee.
    Immigration has long been one of the important issues 
within this Committee's jurisdiction and one that has often 
accompanied bipartisan consensus. In fact, last night was a 
prime example of the type of bipartisan effort to which I 
refer. I want to congratulate the President as well as Senator 
Kennedy, Chairman Sensenbrenner, Senator Brownback, the ranking 
member on our Immigration Subcommittee, along with Senator 
Kennedy, who is chairman, Senator Hagel, Senator Kyl, and many 
others for their efforts to arrive at a strong, bipartisan, 
bicameral compromise on the so-called 245(i) legislation.
    In addition, last year Senator Kennedy and I worked on 
legislation supporting family reunification and immigration 
policies which serve to keep families intact. Also, we have in 
recent years successfully worked together on expansion of the 
H-1B program, which allows necessary workers to come to and 
work in the United States in professional positions. I 
certainly look forward to working closely with the 
administration and members of this body to enact useful 
immigration reforms this Congress.
    Over the past few months, three primary immigration reform 
models have been discussed, those being: one, amnesty; two, a 
guest worker program; and, three, the enactment of various 
``earned adjustment'' provisions. On each, there are strongly 
held views, and I very much look forward to all of the 
witnesses' thoughts and comments here today.
    Before I conclude my remarks, however, I hope you will 
indulge me, Mr. Chairman, while I plug the DREAM Act, S. 1291, 
which I introduced just last month. This bill, which is similar 
to legislation recently introduced by Senator Durbin, is an 
example of an earned adjustment provision. The concept of 
earned adjustment contemplates the giving of a benefit based on 
a personal accomplishment that benefits society as a whole. 
Under the DREAM Act, an alien child who is a long-term illegal 
resident of the United States and is otherwise a respecter of 
the law can earn permanent residency upon graduation from a 
qualified institute of higher education. While I recognize that 
the current emphasis is appropriately on worker migration, I 
think that emphasis should also be placed on the plight of 
illegally present children and their efforts to better 
themselves by pursuing higher education. So I look forward to 
working with Senators Durbin and Kennedy on our respective 
bills and try to get something done on this important matter as 
soon as possible.
    I am very pleased with the work that Senator Kennedy and 
Senator Brownback have been able to do together thus far. 
Senator Brownback, who is new on our Committee, has really, I 
think, jumped into these important issues, these very difficult 
issues, and is paying the price to really master them. And I 
think, Mr. Chairman, you are going to enjoy working with him, 
and certainly I hope that I can be a constructive and helpful 
force here for both of you as well.
    So, again, Mr. Chairman, thank you for scheduling this very 
meaningful hearing. I look forward to the comments of the 
witnesses, and I can only be here for a short while. I would 
ask that Senator Brownback take my position as ranking on the 
Committee for the purposes of this hearing.
    [The prepared statement of Senator Hatch follows.]

STATEMENT OF HON. ORRIN G. HATCH, A U.S. SENATOR FROM THE STATE OF UTAH

    I believe the discussion we're engaging in today is timely and 
appropriate. Appropriate in the sense that, as President Bush has 
recently remarked, the issue of immigration and immigration reform is a 
complex one. Because it is complex, I applaud the Administration's 
careful consideration with regard to a comprehensive plan of action. 
Resolving the issues at hand requires reflective thought and 
discussion. These witnesses before us can, and I'm sure will, offer 
valuable viewpoints.
    Immigration has long been one of the important issues within this 
committee's jurisdiction and one that has often accompanied bipartisan 
consensus. In fact, last night was a prime example of the type of 
bipartisan effort to which I refer. I want to congratulate the 
President as well as Senator Kennedy, Chairman Sesenbrenner, Senator 
Hagel, Senator Kyl, and many others for their efforts to arrive at a 
strong, bipartisan, bicameral compromise on the so-called 245(i) 
legislation.
    In addition, last year Senator Kennedy and I worked on legislation 
supporting family reunification and immigration policies which serve to 
keep families intact. Also, we have in recent years successfully worked 
together on expansion of the H-1B program, which allows necessary 
workers to come to and work in the United States in professional 
positions. I certainly look forward to working closely with the 
Administration and members of this body to enact useful immigration 
reforms this Congress.
    Over the past few months, three primary immigration reform models 
have been discussed. Those being: (1) ``amnesty''; (2) a guest worker 
program; and (3) the enactment of various ``earned adjustment'' 
provisions. On each, there are strongly held views and I very much look 
forward to all of the witnesses thoughts and comments.
    Before I conclude my remarks however, I hope you'll indulge me, Mr. 
Chairman, while I plug the DREAM Act (S. 1291), which I introduced just 
last month. The bill, which is similar to legislation recently 
introduced by Senator Durbin, is an example of an ``earned adjustment'' 
provision. The concept of ``earned adjustment'' contemplates the giving 
of a benefit based on a personal accomplishment that benefits society 
as a whole. Under the DREAM Act, an alien child who is a long-term 
illegal resident of the United States and is otherwise a respecter of 
the law can ``earn'' permanent residency upon graduation from a 
qualified institute of higher education. While I recognize that the 
current emphasis is appropriately on worker migration, I think that 
emphasis should also be placed on the plight of illegally present 
children and their efforts to better themselves by pursuing higher 
education. I look forward to working with Senators Durbin and Kennedy 
on our respective bills and to try to get something done on this 
important matter as soon as possible.

    Senator Kennedy. Thank you very much, and I will just 
mention for the record Senator Hatch's help in making sure the 
Committee was able to report out 245(i), which he referenced 
earlier. It was touch-and-go there for a while, but we were 
able to achieve it, and I thank our colleagues here. I see 
Senator Specter, who is a strong supporter of that program. And 
I would like to recognize Senator Brownback, who was the 
chairman of the Immigration Committee for a little while, and I 
enjoyed working under his tutelage. The Immigration 
Subcommittee has been a small Committee over the years, but we 
have been able to get things done. Senator Brownback has gotten 
into this issue and become very involved and very active, and 
is already a significant leader in it. I welcome his comments 
here.
    Senator Hatch. Mr. Chairman and Senator Brownback, if I 
could just make one comment, thank you for your kind remarks. 
That was a big thing yesterday to get that done. I was so 
impressed with President Vicente Fox yesterday and his desire 
to really bring our nations together in ways that really need 
to be accomplished. And I am just very grateful to the two 
leaders on the Immigration Subcommittee and the work that they 
do, and also Senator Specter, who plays a very, very important 
role on the full Committee as a whole.

STATEMENT OF HON. SAM BROWNBACK, A U.S. SENATOR FROM THE STATE 
                           OF KANSAS

    Senator Brownback. Thank you very much. Thank you, Senator 
Kennedy, for holding the hearing, and thank you for your kind 
comments. And I want to thank Senator Hatch as well for his 
kind comments and the work he did, and congratulations on 
getting 245(i) through the floor last night. Your work, that of 
Senator Hatch, and the support of Senator Specter and many 
others have been invaluable in getting this done.
    Mr. Chairman, members, we are a Nation made prosperous in 
significant part by the toil of immigrants. America is a Nation 
of immigrants who, energized by liberty and resources, have 
helped catapult this Nation into the rank of the best and the 
brightest of nations. We can be proud of this legacy regarding 
the extraordinary contribution of immigrants.
    I would like to begin this hearing by acknowledging this 
invaluable immigrant legacy and by asking three fundamental 
questions: Who are they? Why now? And what now?
    First, who are they? Some come to the United States because 
of political or religious persecution, and by their brave 
commitment to larger principles, they continue to renew our 
fierce love of freedom and justice. However, most immigrants 
came and continue to come primarily in search of economic 
opportunities, striving to make a better life for themselves 
and for their families. In short, we are a more prosperous, 
more free, more tolerant, and a better Nation because of the 
immigrants among us.
    Given these observations, I am especially pleased by this 
hearing today and this opportunity to discuss immigration 
reform. I would like to thank Senator Kennedy for holding this 
important hearing. It is time we adjust our current system 
regarding Mexican immigration. The status quo needs to be 
changed in many ways that we will examine today, and we have 
the opportunity and perhaps even the responsibility, I would 
suggest, to begin this difficult but imperative task now.
    Why now? Most significantly, we have the leadership of 
President Bush, who has repeatedly demonstrated his commitment 
to work for change in partnership with the dynamic new Mexican 
Government headed by President Vicente Fox. Moreover, the 
economic and social contributions of immigrants are 
increasingly recognized as the profile of this issue is raised. 
Immigrants strengthen our culture, as well as help make our 
economy strong. Importantly, they pay taxes. Immigrant 
households and businesses paid an estimate $162 billion in 
taxes in 1998. In my estimation, that is too high. I think we 
should cut taxes even for immigrants as well.
    Additionally, immigration helps solve a pressing problem 
faced by our Nation involving a dramatic worker shortage. By 
2008, according to figures released by the Bureau of Labor 
Statistics, our total projection of available jobs should be 
160.7 million, yet the total civilian labor force is expected 
to be only 154.5 million, resulting in over 5 million more jobs 
than people to fill them. In the long term, it is projected 
that the tight labor markets will continue as the baby-boomer 
generation retires in the next 30 years.
    Our current immigration system with Mexico is badly lacking 
and has been compared to the elephant in the room which no one 
has been willing to acknowledge--until recently, that is, when 
President Bush began to raise the problems, and he should be 
commended for his courage and his vision. I believe that such 
comprehensive reform should make legality the norm and 
rationally reflect the growing needs of our business sectors. 
This is a hard task which will take tenacity and courage, but 
it must be done.
    The urgent need for reform was recently articulated by six 
former Chairs of the Republican National Committee in their 
recent letter to President Bush. Their letter advocated for a 
``freer flow of people to accompany the flow of goods and 
services that have so benefited the citizens of the United 
States.'' They additionally noted that the ``Republican vision 
of a society of opportunity, equality, and commitment to the 
rule of law is one shared by many who seek to enter the United 
States to participate in the American dream.'' I believe they 
are right.
    Where the President leads, the Nation will follow. So, what 
now?
    We need an earned regularization for undocumented people 
who work, pay taxes, contribute to their communities, and seek 
American citizenship. Such people should be given the 
opportunity to obtain permanent residence instead of being 
forced outside the boundaries of the law.
    Number two, we need a new temporary worker program that 
differs from existing programs and respects both the labor 
needs of business and the rights of workers. Current 
immigration law does not meet the present needs of our economy 
in many sectors experiencing worker shortages. Importantly, a 
new program should help deter future illegal immigration by 
creating a more effective, efficient mechanism through which 
people can legally enter the United States.
    Third, we should open up family- and business-based 
immigration to address presently massive backlogs. Illegal 
immigration is symptomatic of a system that fails to reunify 
families and address the economic needs in the United States. 
To ensure a rational and fair system, we must reduce 
bureaucratic obstacles and undue restrictions to permanent 
legal immigration.
    In closing, I look forward to working with the Bush 
administration, with my colleagues on this Committee, with 
Senator Kennedy, and in the Congress, and those of you who have 
the solutions for these very real needs. I particularly look 
forward to working with the chairman, Senator Kennedy. The 
notion that he would serve under my tutelage is quite an honor 
that he gave me and noted. I look forward to working closely 
with him on this issue that has great bipartisan support. 
Ultimately, I hope for a comprehensive immigration reform that 
will serve our Nation well. And, lastly, I ask for the candor 
of our witnesses. We need your boldness, and we seek your 
solutions.
    Mr. Chairman, I look forward to working with you on a very 
important topic. Thank you.
    Senator Kennedy. Thank you very much.
    I want to recognize Senator Specter, who has been very 
involved and active on immigration issues. We are grateful for 
your presence.

STATEMENT OF HON. ARLEN SPECTER, A U.S. SENATOR FROM THE STATE 
                        OF PENNSYLVANIA

    Senator Specter. Thank you very much, Mr. Chairman, and I 
especially commend you for your timing on this hearing when 
President Fox of Mexico addressed a joint session of the 
Congress yesterday in a very impressive speech, emphasized the 
importance of cooperation between the United States and Mexico, 
and the issue of the Mexican migrant workers is a very, very 
important matter that has to be addressed as a matter of 
working out the relationships between our two countries.
    There is beyond any question a tremendous need for workers 
in America, and our country has a great tradition of being a 
country of immigrants, and that is something of special 
importance to me personally because both of my parents were 
immigrants. My father came to this country as a young man of 18 
who wanted to avoid the czar's heel, literally walked across 
Europe, barely a ruble in his pocket, didn't know at the time 
that he had a round-trip ticket--he came steerage to the United 
States, didn't know that he had a round-trip ticket to France, 
not to Paris and the Follies Bergere but to the Argonne Forest, 
where he served his country and was wounded in action. And my 
mother came to this country at the age of 6 with her family, 
settled in St. Joe, Missouri, and they were real contributors 
to this country, as immigrants have traditionally been.
    I had a series of town meetings last month, as we do in the 
recess period, and I must say that there is tremendous concern 
among people about what our immigration policy will be. The 
concerns were expressed on blanket amnesty, and there is a lack 
of understanding of the important role that the migrant workers 
play in the economy. And what has to be done in my judgment is 
to have an assessment, a national assessment made as to our 
worker needs and then to structure a rational policy of 
legalization so that migrant workers are not in the United 
States in fear of being detained and they are not looked down 
upon as being in an illegal status, so that we can both enjoy 
the rule of law and have the appropriate assistance from the 
migrant workers and to carry on the great tradition of America 
which has been so hospitable to immigrants historically.
    This is a tough problem. If it weren't a Friday, I think 
you would see a lot more Senators here. But it is a good day to 
tackle the issue because there will be a lot of focus of 
attention with the travel together that President Bush and 
President Fox are undertaking, and I think they will be looking 
to this Subcommittee and Committee for some positive answers.
    Thank you very much.
    Senator Kennedy. Thank you very much.
    We welcome the members of our first panel: Dr. Demetrios 
Papademetriou and Dr. Fernandez de Castro. Dr. Papademetriou 
and Dr. de Castro were the conveners for the discussions that 
led to the Carnegie Endowment's important report, ``Mexico-U.S. 
Migration: A Shared Responsibility.'' This report served as the 
foundation for principles articulated by the Mexican Government 
as well as by our own democratic principles. And we will 
recognize Dr. Papademetriou.

 STATEMENT OF DEMETRIOS PAPADEMETRIOU, CO-DIRECTOR, MIGRATION 
               POLICY INSTITUTE, WASHINGTON, D.C.

    Mr. Papademetriou. Thank you very much, Mr. Chairman, 
members of the Committee. I am a bit at a loss of words because 
I could actually be testifying and saying the same things that 
the members have actually articulated in the last few minutes. 
But, nonetheless, I will speak a little bit about the report, 
then try to assess where several democratic group principles 
with regard to immigration reform fit within the report.
    The report reflects 8 months of rather intensive work and 
involved, in our view, some of the best thinkers, experts on 
this view, as well as a number of institutional interests. To 
give you a sense: unions senior members from the unions, as 
well as senior members from the business community were 
represented in this consensus report. I am proud to say that 
the final product does not really reflect too many compromises. 
Truly, after 8 months of hard work, a group of often unlike-
minded people came to the reported conclusions. On the Mexican 
side, the report was chaired by Ambassador Rozental and from 
the American side by Mack McLarty, whom I suspect you all know, 
and by Bishop Nick DeMarzio, Bishop of Camden, and chairman of 
the U.S. Catholic Bishops Committee on Migration.
    The panel's assessment was that the status quo is simply 
unacceptable and recommended recasting the relationship between 
the two countries, and I quote: ``from attempting to enforce 
contestable, unilateral propositions to carrying out the terms 
of an agreement.'' That is a fundamental change from the way 
that we have done our business with Mexico in the past 100 
years or so and we hope it is what the future will bring. The 
process differs from asserting absolute notions of sovereignty. 
It is more along the lines of affirming the provisions of a 
mutually beneficial negotiated deal. Very simply, this means 
that we have now come to a much more mature appreciation of the 
role of migration in the American economy, now and for the 
future. We seek in the report to start a conversation--the same 
one that you, the members of the Committee, have apparently 
started--about coming up with an immigration policy that will 
be responsive to the needs of families seeking to reunify with 
their close relatives as well as to employers looking to engage 
foreign employees under conditions that will make us all proud 
rather than recreating the conditions under which previous 
temporary worker programs have operated.
    I will read a short passage from the report, with your 
permission, and then I will go back to oral comments. We said 
that, ``It is increasingly recognized that current enforcement 
policies regarding unauthorized migration from Mexico are 
broken. Presently, the United States maintains a rigid 
patchwork of laws and mounts extensive unilateral law 
enforcement efforts. These have proven largely ineffective at 
achieving the intended outcomes of channeling migration through 
legal entry points and reducing unauthorized migration, while 
unintentionally, but expectedly, spurring the growth of a 
migration black market. As a result, too many migrants die 
trying to cross into the United States, too many hard-working 
immigrants are subject to exploitation, and too many decent 
employers in the United States are undercut by unscrupulous 
competitors who exploit unauthorized immigrants.'' This is the 
fundamental conclusion of our report.
    Now, how does this report fit with the principles? There 
are five pillars in the democratic statement of principles for 
immigration law. The first one is family reunification. That 
principle is fully consistent, fully consonant with our call 
for additional legal permanent visas. Part of the reason that 
over the past 15 years unauthorized migration has grown almost 
out of proportion with what we had seen in prior years is that 
the backlogs for family reunification became too long, and the 
employment-based immigration system, both permanent and 
temporary, was unwilling to keep up with the change in demand 
patterns.
    The second principle is earned access to legalization. We 
also view the process of legalization or regularization--I 
think as of yesterday the new term is ``normalization.'' We are 
very good at euphemisms in this business, as you know so very 
well, Mr. Chairman and Mr. Hatch. Essentially what we are all 
struggling with are what the Committee will be struggling with 
is: How to find a system of credits, or if you will, of rewards 
or points through which people can earn legal permanent status? 
What is it that we are going to decide to reward? And I suspect 
that reasonable people will roughly come up with some sort of 
credit or some sort of points given to people for having been 
in this country for a number of years, having played by the 
rules, having paid taxes, and having contributed to the 
economy. Something perhaps that can be measured by the 
willingness of an employer to suggest that they will continue 
to employ such an individual. Something indicating some 
progress, making an effort toward contributing to the social 
life of our country, through perhaps learning English, making 
an effort in that regard, or engaging the community in which 
the person lives. That is a very difficult thing to quantify, 
but I am sure that people can come up with a system that does 
so.
    The third principle is border safety and protection. We are 
convinced that only through active, almost organic cooperation 
between Mexico and the United States can the border objectives 
that you, Mr. Kennedy, set out a few minutes ago--legality, 
order, the stoppage, the absolute stoppage of violations in 
terms of the human rights and civil rights of individuals, and, 
of course, the protection of our enforcement personnel, the 
border patrol--only through joint cooperation can we achieve 
that goal.
    And then the fourth principle, an enhanced temporary worker 
program. I was delighted to read in this particular passage the 
kinds of things that we have suggested that should be included 
in any temporary worker program, which include a system whereby 
those that choose to pursue a path to permanent residence can 
be allowed to earn that, and that people who enter the program 
and work under something that we call in trade negotiations 
national treatment--in other words, treatment that is equal to 
that of any other U.S. worker in the labor market.
    Finally, you also have here fairness for immigrants and 
legal residents. We haven't really considered that. I don't 
think anyone can take issue with that. But there is one issue 
that appears in our report that does not appear in these 
principles, but nonetheless it was alluded to in the comments 
by the Committee members. We have to think hard about how to 
take care of those things within the context of the immigration 
formula. And we, the panel, think that if indeed we are to 
begin a true new bilateral discussion and resolution of these 
issues with Mexico, inevitably we are going to have to get to 
the point where Mexico and Canada are taken outside of the 
worldwide numerical limits of the U.S. immigration formula. Not 
only is this going to be able to accommodate the special things 
that we wish to do with Mexico, but in addition to that, it 
will provide an opportunity for the other countries in the 
world to gain a number of visas, 20,000, 30,000, 40,000. This 
will allow them to reunify with family members or for employers 
to be able to bring in workers at a faster pace.
    Finally, what I think at the conclusion of what it is that 
we are trying to do we came up with is that we opted for a 
series of things: legality over lawlessness and illegality, and 
for order at the border versus chaos. We opted for fair 
economic opportunity with dignity over exploitation and over 
human and civil rights violations. We opted for safety over 
danger. And we opted for giving employers access to the workers 
they need and the proper conditions for creating rules that 
make so little sense that employers are in some ways invited to 
break them. This is a reference to the point that you also 
made, Mr. Chairman, about rethinking the employer sanctions 
regime that we have created. And, fundamentally, I think what 
the panel agreed to do is to change the way that we conduct our 
immigration business. We ask Mexico and Canada to be partners 
in that effort. That would make the greatest difference in 
outcomes for all of us.
    Thank you very much, Mr. Chairman.
    Senator Kennedy. Dr. de Castro?

    STATEMENT OF RAFAEL FERNANDEZ DE CASTRO, PROFESSOR AND 
   DIRECTOR, DEPARTMENT OF INTERNATIONAL STUDIES, INSTITUTO 
      TECNOLOGICO AUTONOMO DE MEXICO, MEXICO CITY, MEXICO

    Mr. de Castro. Yes, thank you very much, Chairman. It is an 
honor for me to testify in front of this Committee. I 
appreciate the opportunity you Senators are giving me to 
present this report, written by my university, ITAM, in Mexico 
City, and the Carnegie Endowment.
    I am convinced--and that is what I have said to this 
invitation--that we are facing a historical opportunity to make 
migration of Mexicans to this country an orderly and legal 
process, and I guess we should seize that opportunity. That is 
why I decided to come here.
    I will say that President Fox is right. We need soon an 
agreement so that in 4 to 6 years every single Mexican in this 
country should be legal, should be residing here legally. To 
me, two facts explain this historical opportunity.
    First of all, there is the emergence of democracy in 
Mexico. That is very important. That has created a very 
important bond between the two countries, and it seems to me 
that now you can trust even more your Southern neighbor. That 
was yesterday's message by President Fox.
    Second, I will say that President Fox has been 
unprecedentedly committed towards migration. He has made 
migration a priority of his administration, and he is doing 
things that we have never seen before in Mexico. His 
administration is strongly combating the smugglers on the 
border, which is very important. Second, his administration is 
committed to dissuade those Mexican immigrants crossing 
throughout the difficult and dangerous zones. That has no 
precedence in Mexico. And, finally, I guess, the increase of 
the Mexican Government--they have increased their commitment to 
not allow third-country nationals to cross through Mexico and 
to enter into the United States.
    Let me go now to the ITAM-Carnegie report. Let me tell you 
that I have been involved in numerous academic exercises, and I 
have never seen that at the outset of an exercise like this or 
a project like this there is such a big consensus among 
academics. Politics among us might be harder or worse than in 
this Capitol Hill. It is not easy to convince academics. We all 
have our own ideas, and here the ten Americans and the ten 
Mexicans working on this panel, we reached a consensus at the 
very beginning, and the consensus was that the status quo was 
not acceptable. Why was it not? Because there was a big 
contradiction between what NAFTA had done to facilitate the 
crossing of merchandise and services across the border and, on 
the other hand, to have U.S. officials erecting barriers, 
erecting steel walls on the border between Tijuana and San 
Diego. That was a sharp contradiction.
    U.S. policy in the last 5 or 6 years had made Mexican 
migration more dangerous for the undocumented Mexicans 
crossing. That is why the last year almost 500 Mexicans died on 
the border trying to cross undocumentedly. And for two 
countries that are already such important economic partners, 
this is inadvisable. And I guess I cannot be satisfied in 
repeating this.
    Second, it seems to me that these measures to try to keep 
the Mexicans to come into the United States, just increasing 
the border patrol, have made smugglers more necessary. It 
really created a boom for these smugglers.
    Finally, I would say that what once was a circular flow of 
Mexicans, it became now elliptical. Now Mexicans came here and 
stayed longer because for them it is dangerous to go back to 
Mexico and to try to cross back again to the United States. Our 
report highlights a very important thing, and that is that 
Mexico is in the last stage of a demographic transition. That 
means that in the next 10 to 15 years, we are going to have in 
Mexico low fertility rates and low mortality rates, and what is 
important in terms of migration is that the work--the number of 
Mexicans entering into the working age will be dramatically 
reduced.
    Today, 1.2 million Mexicans enter every year into the 
working age. That is the age between 15 and 44 years. And in 10 
to 15 years, that pressure will be reduced in half. Only 
600,000 Mexicans will enter into that force.
    Let me tell you something. Seventy percent of Mexican 
migrants belong to that age between 15 and 44 years old. So 
what the Mexican proposal in a way is proposing to the U.S. is 
to bridge a gap for the next 10 to 15 years. In 10 to 15 years 
from now, we won't have a demographic pressure in Mexico.
    Our report has four principles. Demetri already referred to 
them, but let me give you my perspective.
    First of all, yes, indeed, we need to work in the border in 
a common fashion. It is a common border, so that is why we need 
a shared responsibility.
    Second, we need the regularization of the 3 to 3.5 million 
Mexicans who are here undocumented. If we want to make of this 
an orderly and legal process, we have to deal with it.
    There are two other options, just to forget about them, to 
put them down the carpet, or to deport them. But I believe 
those two options are not admissible for the United States and 
for Mexico.
    The third principle is we need a temporary worker program. 
The bracero experience--and we had a lot of discussions in our 
panel--now we know that we have the lessons of the bracero 
program that was in effect from 1943 to 1964. It is that now we 
need full rights for the Mexicans coming into that temporary 
worker program.
    And the fourth principle--and to me this is the single most 
important one--is to develop economic programs regionally. We 
have to target those zones in which most migration is 
originated, and this should be a shared responsibility. Yes, we 
are talking about a different position of the two countries 
regarding migration.
    I wrote 10 years ago my Ph.D. dissertation in the political 
science department in this country, at Georgetown University, 
about how to manage U.S.-Mexican bilateral affairs. And after 
studying all different ways to manage U.S.-Mexican affairs, I 
came to the conclusion that the best way to manage bilateral 
affairs, the very complicated issues as migration, is by 
establishing legal frameworks that order these issues. That is 
the NAFTA lesson. Before NAFTA, 12 to 13 years ago, Mexico was 
the country in the United States with the most demands for 
unfair trade practices. Nowadays we still have problems, but 
NAFTA has allowed both Mexicans and Americans to manage trade 
issues. And NAFTA has given certainty to the players. That is 
what we have to do in migration, and that is what we have to do 
regarding drug trafficking.
    Thank you very much for this opportunity.
    Senator Kennedy. Thank you very much. That was a very 
helpful summary of the report.
    Let me ask you first the question, Demetrios, and focus on 
one element for a minute, that is, the concept of exempting 
Mexico and Canada from the visa limits. Could you elaborate on 
the concept specifically addressing the following? Is there an 
historical basis for the exemption? And what would be the 
effect on the other nationalities in the backlog? And would 
such a policy change the result in a significant increase in 
actual immigration to the United States, or would many of those 
who would benefit by being able to come legally have come to 
the U.S. illegally?
    Mr. Papademetriou. Thank you, Mr. Kennedy. There is 
actually historical precedent of treating the Western 
Hemisphere differently from the rest of the world. In fact, the 
Western Hemisphere was not folded into the worldwide system of 
immigration, as you may recall. You were the Chair at the time 
in 1978. So there is precedent over there.
    But I think the most compelling reason for this is the 
integration of the two economies and the two labor markets. 
There has been an extraordinary convergence that has taken 
place over the past 10 or 15 years that is not only limited to 
Mexico. Let me give you a datum that I think certainly most 
people find a bit shocking, I guess.
    We are focusing on Mexico and Mexico's participation in our 
economy and our labor market. But in the past few years, the 
participation of Canadians into the American labor market has 
grown at a pace, at the legal end of it, that is much higher 
than that of Mexico. Over 100,000 Canadians last year entered 
the United States and took occupations legally, the vast 
majority of them, about 70,000 or so, through the special visa 
that was created in the NAFTA. Mexicans, of course, get most of 
their visas through the permanent family immigration visa. But 
in the last few years, we have seen significant increases of 
Mexicans receiving the L visa, and also both the H-2A and H-2B 
visas. It is inevitable that the economies will grow closer 
together. NAFTA guarantees that.
    So making certain that we find a way to accommodate in a 
way that makes sense for everyone would be indeed the way to 
go. That would create opportunities in both the permanent and 
the temporary system for other countries. It would liberate 
about 20,000, 25,000 or so visas in the family, the exempt--the 
controlled family part that Mexico now uses, about 10,000 to 
15,000 per year that Canada now uses, and for temporary visas 
that have numerical caps, it would create a big gap that then 
can be filled by other countries.
    It is a different question as to how large the numbers need 
to be, how large the numbers should be or what have you. But if 
you have, as you know very well, a system that is robust, that 
has the right elements in it, we can certainly make it, control 
it, in a way that will actually be consistent with economic 
conditions in the United States and other things that we wish 
to attach to it.
    Senator Kennedy. So your point is that beyond just 
benefiting Canada and Mexico, that there would be the 
opportunities for inclusion of others as well.
    Mr. Papademetriou. Yes, sir.
    Senator Kennedy. And we could develop a process and a 
system which it would not only be perceived as fair, but 
actually be fair. This is something we would have to give some 
thought to. You have given us a general framework on that, but 
it is something that I think a lot of people haven't 
considered, this point about the displacement and the new 
opportunities that would result.
    Do you think that such a policy would result in a 
significant increase in the actual amount of immigration, or 
would many of those that would benefit be able to come legally 
rather than illegally? What is your sense?
    Mr. Papademetriou. My sense is that if we create legal 
channels that make sense, most people will utilize those 
channels. And if we remove the perverse incentives of the 
current system, which are to go through the back door or the 
side doors, and replace them with things that make sense, 
people actually will come and some of them will go back. We 
tend to think of immigration as exclusively a one-way process. 
The historical standard was almost 50 percent, but even today, 
in reality, about 25 percent of the legal immigrants that come 
here actually leave at some point in the future. We are 
infatuated by the fact that the legal number plus the illegal 
number might be whatever, 1.3 million, 1.1 million, depending 
on how you count and where your political convictions are. But, 
in reality, they are that minus about 20 to 25 percent.
    I think we can accommodate the additional numbers because 
fundamentally we have not seen in the 1990s any relationship 
between higher numbers and somehow lower economic or greater 
social cost, lower economic performance, or anything like that.
    Senator Kennedy. Dr. de Castro, I saw you raise your and.
    Mr. de Castro. Yes, I wanted just to mention that the 
numbers of Mexican migration coming into the U.S. are not very 
sensible to the conditions in the United States, to the legal 
conditions or to the difficulties in the border. In the last 5 
years, there is approximately 350,000 Mexicans coming into the 
U.S., and that is regardless of how difficult it is to cross. 
And it seems to me that if you completely open the border or 
you completely close it, you still are going to have those 
numbers because those are the ones who need to have a better 
salary than in Mexico. They are still seeking for better 
salaries. Most of them, they have jobs in Mexico, but it is the 
disparity that brings them to the U.S. labor market.
    Senator Kennedy. I want to try and follow 7-minute time, 
and mine is just about to run out. I want to ask you, you have 
indicated a point system which could be developed to earn legal 
status. Have you developed such a system? Would you submit it 
later on? Could we inquire of you how that could be structured?
    Mr. Papademetriou. I would be happy to work with staff on 
this, Mr. Chairman.
    Senator Kennedy. Many have argued that reform can't give 
undocumented people an unfair advantage over those who have 
played by the rules and waited in line. How do your 
recommendations address that concern?
    Mr. Papademetriou. Well, I guess the way that I would 
handle it--nobody made me an immigration czar or a Senator. The 
way that I would handle it is I would allow people who have 
close family relationships and are waiting in the backlogs to 
actually come in sooner than anybody else. And I think Mr. 
Hatch's--he has left now. Mr. Hatch's law from last year 
creating a V visa may actually facilitate the movement of 
people from the backlog coming to the United States legally 
with full labor market rights, even if they have to wait for 
some years, I would hope fewer rather than more years, before 
they can get their green card.
    I think that might be a way that we might be able to handle 
both the people who are waiting, again, in the closer family 
relationships. I am not going to suggest that somehow the 
siblings preference of 2.5 million people somehow should be 
waved in, you know, in a matter of a year or two. But I would 
suggest that this is one way to handle it.
    And this point system, it is actually an unfortunate term, 
but this system of building credits is by necessity going to 
take longer than any kind of action through a V visa-like 
system.
    Senator Kennedy. Senator Brownback, we are trying to follow 
about a 7- or 8-minute time. We have some flexibility, if that 
is all right.
    Senator Brownback. Yes, that would be just fine. Thank you, 
Senator Kennedy. Excellent testimony, very good report, and I 
appreciate your presentations here today.
    One thing that has been raised often is, as people kind of 
attack this idea of a normalization, regularization, whatever 
you want to call it, it is just a blanket amnesty, that is what 
this is. Would either or both of you care to distinguish 
between what you are proposing and a blanket amnesty program?
    Mr. de Castro. Yes, I would say that the way we are 
envisioning this regularization is a gradual process in which 
you might be rewarding the effort of those Mexicans or foreign 
nationals to assimilate to the society, to pay taxes, and we 
see this as a gradual process in which you have to develop, I 
guess, very imaginative ways to make sure that you reward the 
effort of those migrants to be here and to contribute to this 
society.
    Mr. Papademetriou. Mr. Brownback, the amnesty that we gave 
in 1996, the legalization program--
    Senator Brownback. 1986.
    Mr. Papademetriou. I am sorry, 1986. Okay. I meant to say 
that, 1986. It was indeed a blanket amnesty. People who had 
been here for a number of years, since the beginning of 1982, 
and had essentially played by the rules in terms of not 
breaking the law and had stayed here continuously were able to 
gain legal permanent residence over a period.
    An earned legalization program would invite people who are 
here, who are contributing, who are paying taxes, to try to 
earn a status that was given away to them in 1986. There is a 
big difference in my mind between the one and the other, but 
there is another difference, sir.
    In 1986, we thought that we could do things on our own. It 
was a unilateral act that fundamentally said we are going to 
give you these visas, willingly we are going to now accept the 
fact that about 3 million additional people remain in the 
United States illegally. That was the estimate of the 
population between 1/1/82 and November of 1986, that 5-year 
period. And we pretended that by doing things at the border 
unilaterally or by beating up on employers unilaterally, again, 
we were going to somehow stem the future entry of undocumented 
workers.
    What we are discussing here is an opportunity to do things 
differently, not only enlist Mexico in trying to take out of 
the picture all of the bad actors who systematically break our 
laws and, I think, attempt to defeat both American democracy 
and Mexican democracy by creating in a sense a parallel state, 
as it were. But more than that, by accepting the fact that our 
economy simply needs and can use much larger numbers of 
immigrants, permanent, temporary, than what we are giving them 
through the immigration formula; and accepting that American 
families and the families of green card-holders should also 
reunify at a faster rate. I cannot think of too many people who 
think that separating a wife from a husband or a husband from a 
wife or parents from children for 6 or 7 years, which is what 
happens in our second preference, makes sense to anyone.
    Senator Brownback. No, it doesn't. It doesn't make sense to 
anybody, and it forces people to do things illegally that they 
would not otherwise.
    To me there is a fundamental difference. I would ask both 
of your or either of you, if you know this: What was the number 
of undocumented workers we had prior to 1986? And what is the 
level of undocumented workers that we have now? I think you 
cited that.
    Mr. Papademetriou. Yes. In 1986, our best estimate was that 
we were having somewhere between 5 and 6 million people. We 
gave legal status after the process to about 2.8 million 
people. Presumably we were left with something like 3 million 
people.
    Today, the estimates that most people who look at the data 
very, very, very seriously give are that the number was 
somewhere around 6 million people.
    Now, the Census has come up with numbers that are forcing a 
certain re-examiNation of that. What we don't know is whether 
these people came since the last Census, the additional people, 
or they were here but uncounted in the previous Census, because 
the Census is indicating that the number might be as high as 10 
or 11 million. The question is, again--it is not all 
undocumented, but the number, the difference between what we 
should be finding and what we are finding, the question is how 
many of those people are undocumented rather than simply people 
who were not recorded in 1990. And we don't really know that. 
It will be somewhere between 6 and 8, 8.5 million people. Jeff 
Passel at the Urban Institute, who really lives by the numbers, 
might be a much better person to answer that than I would, sir.
    Senator Brownback. We will do that. The reason I ask that 
is that I think what you are putting forward, what I have 
discussed of an earned legalization process, is far different 
than what an amnesty program is. An amnesty program is a one-
shot program that we thought in the wisdom of the time was 
going to solve our undocumented worker problem at that time. 
Instead, in a number of people's minds, it actually created a 
perverse incentive to say, okay, if you can get here to the 
United States and just stay here for a while, at some point in 
time you will get an amnesty. Whereas, I liked really Dr. de 
Castro's statement about this--what you are talking about here 
is more of a system to manage what is taking place in this 
country, and that we would hope once going into this that this 
would not be something that every few years we would look at an 
amnesty program; but, rather, okay, this is a system where we 
manage the flow.
    I am saying things, but I am hopeful that you are in 
agreement with that conclusion. Would that be correct?
    Mr. de Castro. Very much. That is really the whole purpose 
of, I guess, the final recommendation, is that we should treat 
this very complicated phenomenon in a comprehensive way. And 
that is why I guess the Mexican Government has bought this 
recommendation. They are talking about an integrated package of 
immigration. We believe it is very important in the report. We 
discussed this at length, and we came out with the conclusion 
that in order to solve this, we need a whole package. And this 
is--if you see some similarities between the Mexican Government 
and our report, I can assure you that the report was written 
first, not the Mexican Government came with that proposal.
    Senator Brownback. A final question. As one of you noted--I 
think, Dr. de Castro, you did--that this has created a heyday 
for smugglers into the United States. By our Government's 
estimates, CIA estimates, there are somewhere around 700,000 
people being moved between borders of countries around the 
world, much of that number actually, the 700,000, is generally 
sex trafficking, human trafficking, for a number of illicit 
purposes. It has been a very dark side of the globalized 
economy. But what they also stated was the third leading income 
source now for organized crime is human trafficking, behind 
drugs and gun-running, and they are projecting for it to grow.
    Are your numbers in sequence with that when you say it 
creates a heyday for smugglers in the amount of organized crime 
that is involved with this?
    Mr. de Castro. What we have observed in the U.S.-Mexico 
border is an increase of these bands of smugglers. We do not 
have the number, but what I wanted to comment on this is that I 
am very much encouraged by the maturity of the relationship 
between the two administrations. It seems to me that now even 
in law enforcement, you are going to see the Mexican Government 
willing to cooperate, taking the heat because--that is true in 
the past sometimes we took a position very nationalistic and we 
were unwilling to cooperate in certain aspects with U.S. 
authorities. Now, I am very much encouraged on this. I am 
seeing a Mexican Government that finally, when they agree with 
the U.S., they say so. And they find ways to disagree. I am 
truly encouraged by this new attitude of the Mexican 
Government. I have been studying U.S.-Mexican relations for the 
last 10 years. It has been my passion. And finally you have a 
Mexican Government that sometimes is taking political eat in 
Mexico for being so open to the United States. Yesterday 
Vicente Fox took some heat because of his words he said in 
Congress. It is a new President. He is someone who truly sees 
opportunity in this bilateral relationship, and that is why I 
really commend you to try to seize this opportunity and 
hopefully to have a migration agreement soon.
    Senator Brownback. Thank you. Thank you, Mr. Chairman.
    Senator Kennedy. Senator Specter?
    Senator Specter. Thank you very much, Mr. Chairman.
    Thank you, gentlemen, for your very helpful testimony and 
for this report on ``Mexico-U.S. Migration: A Shared 
Responsibility.'' I think that this should be widely 
distributed. It would lend some substantial understanding to 
the issue.
    Dr. de Castro, you said in your testimony here this morning 
that within 15 years there should be an easing of the pressure 
of Mexican migration into the United States. This migration has 
been going on for a very, very long period of time, obviously 
because of the advantages of the U.S. economy and the better 
jobs here.
    What is your basis for saying that there is an expectation 
that after 15 years there will be an easing or perhaps no 
longer this kind of a problem?
    Mr. de Castro. Yes, it is one of the most--it is very 
difficult as an academic, and you know this as a policymaker, 
to try to understand what causes migration. But what I was 
saying in my testimony is that finally Mexico is finishing up 
its demographic transition. The U.S. did it 40, 50 years ago. 
Mexico is only doing it right now. So that means that at that 
working age there is going to be fewer Mexicans, dramatically 
fewer Mexicans now entering into that working age. At least the 
demographic pressure is going to ease in the next 10 to 15 
years. I don't know about economics. I prefer to not do 
economic projections or forecasts because economists are 
usually wrong, and my university is very well known in Latin 
America for its economics department. They are always wrong. So 
that is why I am only talking here about demographic 
projections, and on that we are certain Mexico is in the last 
stage of its transition, demographic transition.
    Senator Specter. Dr. Papademetriou--
    Mr. de Castro. Now, if you--sorry, Senator. Now, for 
example, Mexico's growth rate is 1.7, and that will be 
dramatically reduced in the next years, and because now it is 
only 1.7, that would allow us to project that in 10 to 15 years 
those Mexicans entering into the age 15 years old or older, it 
is only going to be half of what they are right now. Sorry to 
interrupt you.
    Senator Specter. Dr. Papademetriou, I would be interested 
in your response to the issues raised by so many of my 
constituents. I had said that in the month of August and 
travels through town meetings this issue of illegal immigration 
comes up again and again, really sort of surprising to me that 
it does so. We have had the North Atlantic Free Trade 
Agreement, so-called NAFTA, and there is very, very substantial 
unrest that I find about it, tremendous labor opposition to it 
in my State. I supported NAFTA because I think that, 
notwithstanding temporary dislocations, in the long run it will 
be beneficial. It will stimulate the economies of both 
countries, and in the long run, the United States will be 
better off if we have a Mexico which is much strong 
economically. But I come back to a point of substantial unrest 
among the people about it.
    Now, you have the well-known economic downturn which is 
gripping this country today, and while analytically I think it 
is supportable that the Mexican migrants are important, are 
playing an important role in filling jobs, what is your 
response to the people who are losing their jobs, are concerned 
about NAFTA, and then the suggestion which Dr. de Castro makes 
to legalize 3 to 3.5 million illegal immigrants?
    Mr. Papademetriou. Thank you, Senator. Let's start with 
your last point, this 3 or 3.5 million--whatever that number 
might be of people who are already here--they are working here. 
To suggest somehow that if we removed that population or part 
of that population jobs would become available simply to U.S. 
workers, by that I mean anyone who is in the United States 
legally and has an opportunity to take those jobs, falls 
under--
    Senator Specter. I agree with you that that is the rational 
response. But how do you respond to the concerns of people that 
say we play by the rules and they don't, and why should we 
consider this legalization or amnesty?
    Mr. Papademetriou. Well, playing by the rules is an 
extremely important argument. I never downplay it because we 
are committed as a country to playing by the rules, to obeying 
the law. But I have not heard in the past 15 or 25 years that I 
have actually been studying these issues an alternative to what 
it is that is being discussed here today. I have not heard 
anyone that suggests that somehow we are going to take these 
people and kick them out of the country because we tried that, 
as you may recall, in the 1950s and we created extraordinary 
difficulties for American families and U.S. citizens.
    So this is about facing the facts and trying to come up 
with a reasonable way through which people who have been 
contributing to the economy and, indeed, have become part and 
parcel of American communities, the communities in which they 
live, to earn the right to stay here. That is why we are 
putting the emphasis on earning that right.
    Some people may choose not to try to or may not qualify for 
that, and that would require--when the conversation advances--
conversation about what is the best means to deal with those 
people who either don't qualify or choose not to play by the 
rules. Because ultimately, at the end of the day, you know this 
at least as well as I do, we are also going to have to rethink 
how to have a better law that is enforceable to try to ferret 
out the employers and people who continue not to play by the 
rules.
    Senator Specter. Dr. de Castro, yesterday Mexican President 
Fox talked about having the Mexican migrant workers returned to 
Mexico. And I note in your report there is a statement that, 
``The Fox administration has shown increased interest in 
encouraging Mexican immigrants to increase their remittances to 
Mexico,'' which shows an interest on the part of the Mexican 
Government in having migrant workers in the United States who 
earn funds and can remit.
    The topic of the report is ``Mexico-U.S. Migration: A 
Shared Responsibility.'' To what extent, Dr. de Castro, does 
Mexico seek to prevent Mexican migrant workers from coming 
illegally into the United States as part of a shared 
responsibility?
    Mr. de Castro. I will say as much as the government can do 
it. It won't be easy, but there are ways to do it. For example, 
what Mexico, what the government is already doing is 
discouraging migrants to cross through dangerous zones. By the 
Mexican Constitution, the government cannot impede Mexicans to 
go out of the country, but there are ways to do it, by 
developing economic regions, by regulating airlines coming 
towards Tijuana. There are ways to do it, and they are willing 
to do it. It won't be easy. But I see the commitment.
    What we are talking about the remittances there is the 
commitment of the Fox administration to reduce what migrants 
have to pay to send money back to Mexico. They are very 
committed to it. There are very few firms doing this. One of 
them is Western Union, and it is very expensive for them to 
send money to Mexico. And it is not only a problem for Mexico, 
but it is a big problem for Central America. And that is where 
they are trying to come up with new ideas in how to do this in 
a cheaper way, and also how can they help--or put some more 
money by the government or international institutions that will 
truly help these remittances to be used as development money, 
not only for consumption.
    If you will allow me to say, when you were talking about 
NAFTA, it seems to me that NAFTA stops short in creating a 
mechanism to help those affected by NAFTA, and it seems to me 
that now, in retrospect, when we look at NAFTA, NAFTA made a 
big mistake, and that is, they took out of the negotiation 
migration and energy. Those are the two topics that we are 
negotiating now, and it is very important, if we are truly 
committed to having a North American economic region, we have 
to have an agreement on migration as well as on energy. It 
won't be easy for Mexico because it is very sensible to the 
Mexicans to talk about energy. To us it is very close to our 
nationalistic heart. But now the Mexican Government is having 
conversations with the U.S. Government regarding energy.
    Senator Specter. Thank you very much, gentlemen. My red 
light is on. I would just like to say that I am not going to be 
able to stay for the entire hearing. I do think it is very 
productive, and I will be studying the transcripts and looking 
for some answers to these tough issues.
    Thank you very much. Thank you, Mr. Chairman.
    Senator Kennedy. Thank you very much.
    Thank you. We will submit some additional questions. You 
have been very, very helpful, and we are going to be calling on 
you for guidance as we move ahead. Thank you very much.
    Mr. Papademetriou. Thank you, Mr. Chairman.
    Mr. de Castro. Thank you. I will leave a copy in Spanish.
    Senator Kennedy. That will be very helpful.
    I would like to welcome our second panel: Mr. John Sweeney, 
president of the AFL-CIO; Thomas Donohue, president and CEO of 
the U.S. Chamber of Commerce; Raul Yzaguirre, president of the 
National Council of La Raza.
    It is an important occasion when we have labor, business, 
and immigration leaders stand together in support of 
legislative reform. Although their presence on this panel 
speaks for itself, we look forward to their testimony. We are 
very grateful to all of them for joining with us here this 
morning, and we will start with you, Mr. Sweeney, if you would 
be good enough.

 STATEMENT OF JOHN J. SWEENEY, PRESIDENT, AFL-CIO, WASHINGTON, 
                              D.C.

    Mr. Sweeney. Thank you very much, Mr. Chairman and members 
of the Committee. On behalf of the AFL-CIO, thank you for the 
opportunity to discuss one of the most important issues we 
face, our Nation's immigration policies. I am happy to say that 
I just came from a meeting with President Fox to discuss this 
very same issue.
    Members of the Committee, workers in the United States are, 
as you know, a rich tapestry of every race, gender, ethnicity, 
and immigration status. We have our differences, but we share 
common values and hopes: better lives for our families, the 
opportunity to hold good jobs in safe environments, and work 
that accords us dignity and respect, free from discrimination.
    These fundamental aspirations of the human spirit do not 
distinguish between workers based on immigration status. Nor, 
we believe, should we.
    The United States is a Nation of immigrants, yet we daily 
visit injustice upon new arrivals to our shores, a cruel irony 
not lost on those of us who are the children of immigrants. My 
own parents came here from Ireland. My personal feelings are 
greatly influenced by their experiences. Indeed, it was those 
experiences that drew me to unions. I saw firsthand the 
powerful role immigrants play within unions and the equally 
powerful role unions play in improving the lives of immigrant 
workers.
    Today, growing numbers of immigrants are once again winning 
a voice at work through unions. We are honored to welcome them 
to our ranks. In recent statements, the AFL-CIO Executive 
Council has placed our movement squarely on the side of 
immigrant workers. We believe the principles outlined in those 
statements should inform national policy as well. First and 
foremost, undocumented workers and their families should 
receive permanent legal status through a new legalization 
program that extends to all the undocumented among us 
regardless of their country of origin. It is unacceptable that 
upwards of 8 million people live and work here without the full 
protection of the law, constantly at risk of exploitation and 
abuse.
    Our current policy ignores the fact that many undocumented 
workers contribute to the national economy, have children who 
are U.S. citizens, and are long-term, law-abiding members of 
their communities. As a matter of fundamental justice, 
undocumented immigrant workers who have worked hard, paid 
taxes, and contributed to their workplaces and communities 
should be allowed to adjust their status to legal permanent 
resident.
    Second, the current system of employer sanctions and the I-
9 verification should be repealed and replaced with a system 
that targets and criminalizes business behavior that exploits 
workers for commercial gain and that provides protections for 
undocumented workers who file well-grounded complaints against 
their employers. I think no one can credibly dispute that the 
current system has failed. It encourages manipulation by 
unscrupulous employers who hide behind it to exploit and 
intimidate workers. It has not deterred the flow of 
undocumented workers into the United States and almost no 
employer ever experiences a penalty or sanction.
    Third, immigrant workers should enjoy full workplace 
protections, including the rights to organize into unions and 
to seek vindication of their workplace guarantees free of 
employer intimidation. Undocumented workers typically fall 
through and outside the Nation's worker protection safety net. 
The constant threat of deportation serves as a velvet hammer 
employers can wield not only to deny basic rights, but also to 
deter these workers from filing complaints. Since most labor 
standards investigations arise from complaints, employers can 
deny rights and protections for undocumented workers with 
virtual impunity or, almost as perverse, call the INS to report 
undocumented workers after learning of organizing campaigns or 
labor standards complaints.
    Instead of punishing workers, immigration and labor 
standards policies should specifically penalize employers who 
break the law and, just as specifically, protect workers who 
uphold the sanctity of our legal system by pursuing their labor 
and employment rights.
    Finally, guest worker programs should be reformed but not 
expanded. We do not agree with policymakers who argue that a 
new guest worker program is the antidote for our current failed 
immigration policies.
    As I noted, the first order of business should be to give 
access to permanent legal status to immigrants who have been 
living and working in this country, paying taxes, and 
contributing to their communities. We are deeply troubled by 
proposals to lift restrictions on recruiting and hiring low-
wage, low-skilled foreign workers while conferring only limited 
protections on those workers and prohibiting them from seeking 
permanent residency. Any temporary worker program must ensure 
full workplace protections for temporary workers, must include 
a path to permanent legalization for those who want it, and 
must not be based on a temporary worker's relationship to a 
single employer. Such a program must also include a real and 
meaningful labor market test to guarantee there are no U.S. 
workers for the jobs.
    I will close much as I began: Union members know that the 
fortunes and futures of all workers in the United States are 
linked. If undocumented workers have no practical choice but to 
accept sub-standard pay and working conditions, their U.S. 
counterparts will eventually be relegated to such conditions as 
well. We know that when we act to strengthen protections for 
the most vulnerable among us, we build a movement and a system 
that is stronger for all of us.
    Thank you.
    [The prepared statement of Mr. Sweeney follows:]

   STATEMENT OF JOHN J. SWEENEY, PRESIDENT, AFL-CIO, WASHINGTON, D.C.

    On behalf of the AFL-CIO, thank you for the opportunity to be here 
today to discuss one of the most important issues we face as a Nation 
and a people, our policies with respect to immigrants and immigration. 
The scores of unions that make up the AFL-CIO represent over 13 million 
working men and women of every race, ethnicity, and immigration status. 
Knitting together this rich tapestry of color, language and country of 
origin are shared values and hopes: All workers want to provide better 
lives for their families. All of us want the opportunity to hold good 
jobs in safe environments, which pay a living wage and provide reliable 
health care and retirement benefits and a chance to better ourselves 
through education and training. And as much as anything else, workers 
here and around the world want to be treated with basic dignity and 
respect, free from persecution and harassment based on who we are or 
where we come from. These fundamental aspirations of the human spirit 
do not distinguish between workers based on their immigration status. 
Nor, we believe, should we.
    The United States is a Nation of immigrants. Now as in the past, 
immigrants enrich our lives, contributing energy, talent and commitment 
to making our economy more vibrant; our workplaces more productive; and 
our nation, better and stronger. We will be better still, if we move 
forward with courage, compassion and conviction to shape a new 
immigration policy that protects the rights and promotes the interests 
of all those who live and work in the United States, contributing to 
their families, their communities, and the Nation as a whole.
    The Special Relationship Between Unions and Immigrants: American 
workers and their unions are indebted to earlier generations of 
immigrants who, in their determiNation to fight exploitation and abuse, 
founded the union movement and in so doing, improved working conditions 
and living standards for all working families. Today, growing numbers 
of immigrant workers are once again winning a voice at work by joining 
together into unions. Last year, 10 percent of all union members were 
foreign born, roughly mirroring immigrants' share of the population 
overall.
    Many immigrants work in low wage occupations for which the Bureau 
of Labor Statistics projects very substantial job growth over the next 
few years. It is no surprise, then, that AFL-CIO unions which represent 
workers in these industries--the Hotel Employees and Restaurant 
Employees Union, the Service Employees International Union, the 
Laborers International Union of North America, and the United Food and 
Commercial Workers--are also among those unions whose ranks are growing 
most.
    Those of us in the union movement are proud and honored to count 
these immigrant workers in our ranks. We know that for many immigrants, 
a union card is the first and best line of defense against 
exploitation. In the AFL-CIO's Labor Day survey on Workers--Rights in 
America, most workers of color--86% of Latinos, 85% of African-
Americans, and 83% of Asian workers B said recent immigrants are more 
likely than other workers to be treated unfairly by employers. And 
immigrant workers (especially Latinos) were more likely than workers 
overall to say workers need greater protections of their rights on the 
job. We know that the workplace is stronger, fairer and safer not only 
for immigrants and others most vulnerable to abuse, but for all workers 
when the rights of every worker are equally protected and enforced.
    Union membership also often offers immigrant workers, especially 
those at the bottom of the economic ladder, the greatest chance to 
share in the American dream. In general, workers represented by unions 
earn higher wages and are far more likely to have employer-provided 
health insurance than non-union workers in similar jobs. In low wage 
occupations where many immigrants work--as laborers and agricultural 
employees, for example--workers represented by unions earn wages 56% to 
59% greater than their nonunion counterparts. Ninety percent of all 
union members have health insurance, compared with 76% of nonunion 
workers. Job-based access to health insurance is particularly important 
to immigrants, who are more likely than other groups of workers to be 
uninsured.
    We recognize and acknowledge that occasionally in the past, there 
has been resistance within our own ranks to new groups in society and 
in the workplace. Early in the history of the labor movement, U.S.-born 
workers resisted Irish workers, whom they feared would take their jobs 
at lower wages. African American and women workers faced similar 
resistance and fears. In each instance, however, understanding and 
inclusion of these workers in the union movement energized us and made 
us stronger. We believe the time has come for our movement and our 
Nation to accord more recent immigrant workers that same understanding, 
inclusion and opportunity to become full participants in their 
workplaces and communities.
    Principles of Immigration Reform: More than a year ago, in February 
2000, and then again just last month, the AFL-CIO Executive Council 
firmly and squarely placed the union movement on the side of immigrant 
workers. In statements adopted without dissent, the Council set out our 
view that immigrants have played and continue to play an extremely 
important role in the workplace and society, and that they are entitled 
to full and fair workplace protections. We believe the principles 
articulated in those Council statements should inform national 
immigration policy. Specifically,

        1. Undocumented workers and their families should receive 
        permanent legal status through a new legalization program;
        2. Employer sanctions and the I-9 system should be replaced 
        with a system that targets and criminalizes business behavior 
        that exploits workers for commercial gain;
        3. Immigrant workers should enjoy full workplace protections, 
        including the rights to organize into unions and to seek 
        vindication of their rights free of employer intimidation; and
        4. Guestworker programs should be reformed but not expanded.
    Legalization: The labor movement is increasingly concerned about 
the welfare of our undocumented brothers and sisters, as we are for all 
immigrant workers. As I have discussed, the relationship between unions 
and their immigrant members is mutual: unions make a tremendous 
positive impact on the lives of immigrant workers and their families, 
and immigrant workers have long been a vital part of the union 
movement. Immigrant workers have courageously stood with U.S. workers, 
leading organizing drives and assuming positions of leadership on both 
the local and national levels. The AFL-CIO supports efforts to legalize 
undocumented workers who contribute to their workplaces and community. 
In fact, a number of our international unions assisted many 
undocumented workers who adjusted their status under the last broad 
legalization program, the Immigration Reform Act of 1986 (IRCA).
    It is unacceptable that upwards of 8 million people live and work 
in our country each day without the full protection of the law. 
Undocumented workers and their families are constantly at risk of being 
preyed upon by criminals, dishonest landlords, or unscrupulous 
employers, by those who believe they can get away with breaking the law 
simply because their victims are immigrants. But, undocumented people 
are not the sole victims when these laws are broken: All of us lose a 
bit of our own legal protections when entire categories of people are 
denied theirs. This is especially true in the workplace, where 
employers may sometimes seek to polarize workers based on race, 
ethnicity or national origin. In the face of such divide and conquer 
strategies, labor and employment laws are broken with impunity, wages 
and working conditions stagnate or fall, and worker progress overall is 
impeded.
    As a matter of fundamental justice, undocumented immigrant workers 
who have worked hard, paid taxes and contributed to their workplaces 
and communities should be allowed to adjust their status to legal, 
permanent resident.
    Under current law, only those undocumented individuals who can show 
they were U.S. residents since 1972, almost 30 years ago, may adjust 
their status. Even as we were putting the finishing touches on this 
testimony, the Senate still had not approved S. 778, extending section 
245(i) to allow some undocumented people to adjust their status, 
thereby reducing the size of the undocumented population. Our current 
immigration policy ignores the fact that many undocumented workers 
contribute to the national economy, have children who are U.S. 
citizens, and are long-term, law-abiding members of their communities.
    A broad legalization program must also allow undocumented people 
from all countries to adjust their status. The large number of 
undocumented Mexican workers is a consequence of the 2000-mile border 
and 300 year history our nations share. We recognize and cherish the 
bond and special relationship between our countries. And we value and 
respect Mexican migrants; they are hardworking and deserving. But so, 
too, are undocumented workers from Haiti, Guatemala, Poland, Canada and 
elsewhere. They also have stories to tell of their hopes and dreams for 
a future in the United States, and they also work hard and contribute 
to their communities each and every day.
    Limiting a legalization program to one nationality will only 
further divide us as a people, and leave millions of workers and their 
families without the legal protections they deserve.
    Repeal and Replacement of Employer Sanctions and the I-9 
Verification System: The last legalization law enacted, IRCA in 1986, 
included provisions making it illegal for an employer to hire a worker 
without work authorization, imposing employer sanctions for violations 
of that law.
    These provisions have not worked and should be repealed. Even 
though the object of employer sanctions was to punish employers who 
knowingly hire undocumented workers, and not the workers themselves, in 
reality employers have manipulated the program to violate federal and 
state labor laws and to discriminate against workers. The current 
situation not only harms all workers, but also those employers who face 
unfair competition from others who skimp on labor costs by hiring and 
then exploiting undocumented workers.
    I think no one will contest that employer sanctions have failed. 
They have not deterred the flow of undocumented workers into the United 
States, and almost no employer ever experiences a penalty or sanction. 
In 1999, the General Accounting Office reported that only 17% of lead-
driven cases resulted in any sanction or penalty against employers who 
had violated the law, and that INS collected only 50% of the fines that 
were levied. During the same period reviewed by the GAO, only 2% of all 
investigations resulted in a criminal penalty.
    Complementing the employer sanctions program is the I-9 form, which 
verifies an individual's authorization to work. Employers are required 
to keep these forms on file for inspection by the Immigration and 
Naturalization Service (INS). In addition to the paperwork burden it 
imposes on employers, the I-9 system does not protect workers or 
prevent the hiring of the undocumented. Workers sometimes falsify 
records in order to comply with the verification requirements. And, 
many employers are cavalier or worse in their own compliance, sometimes 
encouraging or condoning falsification, only to ``discover'' it later, 
when the workers begin to push for higher wages and better working 
conditions. Like the system of employer sanctions, the I-9 verification 
system has not worked and should be scrapped.
    Finally, shortly after IRCA's enactment, it became clear that 
numerous workers, mainly Asian and Latino, faced discrimiNation by 
employers who assumed the workers lacked legitimate work authorization 
because they ``appeared'' foreign or spoke with accents. In effect, a 
system designed to penalize one form of unlawful behavior promoted 
another.
    Although employer sanctions did not create the problems of 
exploitation and discrimination, they have contributed significantly to 
the inability of immigrant workers to enjoy and enforce the most basic 
of labor and workplace rights. Having failed to fulfill their central 
purposes and, indeed, having set back the progress of workers 
generally, employer sanctions must be repealed. The current system of 
employer sanctions and I-9 verification should be replaced with a new 
scheme that punishes those employers who deliberately break immigration 
and labor laws for economic gain. We should increase criminal penalties 
for employers who knowingly recruit undocumented workers and 
participate in document fraud for business advantage. Moreover, to help 
ensure the new scheme works and to avoid the manipulation that 
characterizes the present system, it is essential that immigrant 
workers, who risk unfair deportation when they stand up for their 
rights, receive protections when they file well-ground complaints 
against their employers.
    Full workplace rights: In theory, all workers, regardless of 
immigration status, enjoy most of the basic rights and protections 
under the Nation's labor and employment laws. In reality, though, 
undocumented workers typically fall through and outside this safety 
net--a result that all too often occurs not by accident, but by design. 
The constant threat of deportation serves as a velvet hammer employers 
can wield not only to deny basic rights, such as the right to earn the 
minimum wage, but also to deter undocumented workers from filing 
complaints. And since most labor standards investigations are 
complaint-driven, employers deny rights and protections for 
undocumented workers with virtual impunity.
    In many instances, employers call the INS to report undocumented 
workers only after they get wind of organizing campaigns or labor 
standards complaints. Upon learning of organizing efforts or that 
immigrant workers have filed wage and hour, OSHA, or EEOC charges, 
employers who have shown no interest in complying with any other labor 
law suddenly become converted to the sanctity of the ban on hiring 
workers without work authorization. In a sense, employers determine 
immigration enforcement policy by alerting the INS whenever workers 
seek to exercise their employment and labor rights.
    Union organizers have faced this tactic when they try to organize 
workplaces that are comprised predominantly of immigrant workers. It 
takes a lot of courage for workers to come forward and openly fight for 
a voice at work through a union. The Human Rights Watch stated in its 
report Unfair Advantage: Workers-Freedom of Association in the United 
States under International Human Rights Standards, that many U.S. 
workers--who try to form and join trade unions to bargain with their 
employer are spied on, harassed, pressured, threatened, suspended, 
fired, deported or otherwise victimized in reprisal for their exercise 
of the right to freedom of association. The threat to immigrant workers 
is even greater: they risk not only job loss, but also possible 
deportation if they exercise their right to form a union.
    In fact, using the threat of INS enforcement to chill worker 
activity has been a disturbingly prevalent business practice since the 
implementation of employer sanctions. I would like to give you a couple 
of the many examples of employers who tried to use the immigration laws 
to deny worker rights:

        In 1997, the UFCW began an organizing campaign at the 
        Smithfield Packing Company in North Carolina. Racial and ethnic 
        separation characterized assignments at Smithfield Packing: 
        white workers held mechanical or supervisory jobs, Native 
        Americans worked in the warehouse, and African Americans and 
        Mexican immigrants were consigned to the``dirty'' and dangerous 
        jobs of slaughtering and butchering animals. When UFCW first 
        began its organizing drive, the company fired African American 
        union supporters, and replaced them with Mexican immigrant 
        workers it believed would not vote for union representation. 
        Just before the vote, Smithfield segregated the workers into 
        different rooms by race, then singled out the Latino workers 
        for questioning regarding their immigration status, threatening 
        to call the INS and have them deported. The morning of the 
        union vote, county deputy sheriffs in riot gear lined the plant 
        gates. Not surprisingly, the union lost the vote, but earlier 
        this year, the NLRB set aside the results and ordered a new 
        election. The Board also found that the company illegally fired 
        11 workers because of their union activities.
        Two weeks ago, the EEOC sued DeCoster Farms, an egg processing 
        plant located near Clarion, Iowa. The EEOC charged that Latina 
        workers were repeatedly raped by their supervisors and 
        threatened with firings, deportation, or even murder if they 
        reported the crimes. The EEOC is also investigating charges 
        that the women were paid less than male workers and were denied 
        access to water or breaks as required by law. The supervisors 
        are all male and bilingual. One of the supervisors named by the 
        EEOC as a perpetrator in the rapes was also arrested last week 
        by the INS and charged with harboring unauthorized workers 
        during an immigration enforcement raid that occurred in April. 
        The workers, who speak little or no English, live in rural Iowa 
        where they are isolated geographically and culturally. Some of 
        them have apparently quit their jobs and are currently living 
        in a domestic violence shelter.

    Instead of punishing workers, immigration and labor standards 
policies should specifically penalize employers who break the law and 
protect workers who uphold the sanctity of our legal system by pursuing 
their labor and employment rights. We need to ensure that all workers, 
regardless of their immigration status, are made aware of their rights 
and of the means to vindicate them. And immigrant workers should have 
specific protections against employers who try to use the workers' 
immigration status to block their efforts to form a union or to 
otherwise exercise basic workplace rights. Workers should be protected 
against deportation when they file a labor standards complaint unless 
the INS can prove that the deportation proceedings are in no way 
related to the workplace situation, and that the complaint was not 
filed in bad faith to avoid deportation. Agencies such as the 
Department of Labor should be required to keep confidential any 
information they learn about a worker's immigration status during an 
investigation or proceeding enforcing labor rights. The INS should be 
prohibited from proceeding with workplace investigations during a labor 
dispute. Finally, in order to better target investigations and 
enforcement, the Departments of Labor and Justice should be required to 
conduct a study of industries that employ undocumented workers, and the 
exploitation of undocumented workers by their employers.
    Of course, continued inadequate funding for labor standards 
enforcement will hamper the measures I have outlined above. Funding for 
labor protection activities has not kept pace with labor force growth 
during the 1990's. We must reverse that trend and fund these programs 
adequately, if we are to ensure full workplace rights and protections 
for all.
    Reforming guestworker programs: Some policymakers have advocated a 
new guestworker program as the answer to the problems associated with 
our current failed immigration policies. We do not agree. Before there 
is any serious consideration given to a new guestworker program, 
immigrants who have been living in this country, holding jobs, paying 
taxes and contributing to their communities must be given access to 
permanent legal status.
    Beyond that, we are deeply troubled by the guestworker proposals 
some are advocating, which would lift restrictions on recruiting and 
hiring low wage, low skilled foreign workers, while conferring only 
limited protections on these workers and prohibiting them from seeking 
permanent residency. We recognize that some workers want to return to 
their native countries and should be able to do so, but any new 
temporary worker program must include a path to permanent legalization.
    A new guestworker program built on the failed policies and models 
of the past cannot be the centerpiece of our national immigration 
policy. Analyses by DOL, GAO and others have found that despite 
employers' claims to the contrary, guestworkers earn less than their 
U.S. counterparts. Years of low wages facilitated by the bracero and H-
2A programs and easy access to undocumented workers have left U.S. 
agricultural workers with wages that actually fell during the last 
economic expansion, a time when virtually all other low wage, low skill 
workers saw their incomes rise. An INS report to Congress verified that 
even highly skilled H-1B visa holders in the IT industry earned less 
than U.S. workers in the same occupations.
    Guestworkers regularly face many of the problems associated with 
contingent employment: lower pay, no benefits and intentional 
misclassification of employment status.
    President Bush has suggested that guest worker programs merely 
match willing workers to employers who are willing to hire them. The 
President's statements, however benign sounding, do nothing to address 
the serious failings of guestworker programs, or the need to test the 
U.S. labor market first, to assure that there are no domestic workers 
interested in the positions. Nor do the President's statements 
recognize that often guestworkers are only willing to take jobs at 
below the going rate because they are desperate to come to or stay in 
the United States.
    Guestworkers are tied to an employer or industry or occupation in a 
way that other workers are not. That alone makes them extremely 
vulnerable. While guestworkers are covered by most labor and employment 
laws, the nature of their tie to their employer makes these protections 
more fiction than reality for most. Hence, any guestworker program must 
include and protect all the workplace rights that U.S. workers enjoy. 
In addition, a new guestworker program based entirely on a worker's 
relationship to his or her employer, resulting in a system of virtual 
bondage for many, is unacceptable.
    Additional Concerns: We recognize that the issues we have discussed 
touch on just a few aspects of national immigration policy. Our current 
legal immigration system for family members, for example, is in 
shamefully bad shape. Whether addressing family reunification backlogs 
or processing applications for those seeking to adjust their status, 
the INS needs adequate funding specifically dedicated to benefits and 
services. The promise of legalization is only real when the agency 
administering the program has properly trained staff, reasonable 
regulations that are consistent with the letter and spirit of the law, 
and the funding necessary to process applications in a fair and 
efficient manner.

                               Conclusion

    Unions are playing an important role in bridging the gap between 
immigrant and non-immigrant workers. We know that the fortunes and 
futures of all workers in the United States are linked: If undocumented 
workers have no practical choice but to accept substandard pay and 
working conditions, their U.S. counterparts will eventually be forced 
to accept such conditions as well. There is no protection for any 
worker when some workers have freedom to exercise their labor and 
employment rights and others do not.
    Unions have already begun the process of bringing workers together 
and encouraging open and frank discussions in the workplace and in our 
communities. We believe this dialog fosters the respect and brotherhood 
necessary for our country to move forward, even as our demographics 
change.
    And we know that when we act to strengthen protections for the most 
vulnerable among us, we build a movement and a system that is stronger 
for all of us.

    Senator Kennedy. Thank you very much, Mr. Sweeney. We look 
forward to inquiring of you in just a few moments.
    Mr. Donohue, we are pleased to have you. We know you 
interrupted your break to join with us here today, so we 
appreciate your presence.

 STATEMENT OF THOMAS J. DONOHUE, PRESIDENT AND CHIEF EXECUTIVE 
      OFFICER, U.S. CHAMBER OF COMMERCE, WASHINGTON, D.C.

    Mr. Donohue. Thank you, Senator. I am very pleased to be 
here with my colleagues to discuss an issue of critical 
importance to the future well-being of this country, and that 
is immigration reform.
    John Sweeney and I testify together from time to time, and 
from time to time we agree. We agree on this issue from 
different perspectives, but the fact is that we realize there 
needs to be change in the immigration system, and it needs to 
be done for the benefit of the country.
    There are two primary reasons why immigration reform in my 
view is so important. First, an expanding economy, a declining 
working-age population, and an impending retirement of the 
baby-boom generation have all combined to create a current and 
future workplace shortage that, if left unchecked, will cripple 
American business, especially small ones, and severely impede 
economic growth. And I would like to--the chairman in his other 
work in the Senate is very, very involved in the whole question 
of entitlements--health, pensions, Social Security, and so on. 
And if you look at the extension of life expectancy in this 
country and the extraordinary number of collectors we are going 
to have in the next years in relation to the shrinkage of the 
people that are prepared to work here and pay taxes here, you 
find that this Nation, because of its population change, 
because of its societal changes and these retirements that we 
are expecting, has got a great opportunity to do important 
things but has a tremendous challenge of where we are going to 
get the workers of the future.
    More than 60 million current employees will likely retire 
over the next 30 years, and the Bureau of Labor Statistics 
projects that people on the labor force age 25 to 34 is going 
to decline by 2.7 million just over the next 7 years. Improving 
productivity, recruiting non-traditional employees such as the 
disabled, and taking people from welfare to work, luring 
retirees out of retirement because they are going to be around 
for a long, long time, and creating incentives for people to 
work longer on a voluntary basis are all part of the solution. 
But it is not going to happen without some very, very serious 
increases in immigration. We won't close the worker shortage 
without filling that gap on the immigration side.
    Now, as John indicated, there are 8 or 9 or maybe 10 or 11 
million undocumented immigrants working in America. Now, why 
are they here? Were those jobs created because they came here? 
No. Those jobs are here. And where are they? They are in 
hospitals. They are in the fields. They are in factories. They 
are in McDonald's. They are in all sorts of places where today 
we are unable to get sufficient workers. Many jobs are left 
unfilled in this country, and they are essential jobs. I have 
some involvement personally in the retirement and the health 
care business in terms of nursing homes. You take those 8 
million employees, 9 million, 10 million, and you put them out 
of the country tomorrow, this economy, and particularly the 
service economy in this country, is going to stop dead in its 
tracks.
    Now, John's views about protecting them, many of those I 
share. And John's views about--and I would let him speak for 
himself, but, you know, he sees a wonderful opportunity to 
continue to grow his own institution. And I respect that. But 
even though we have two different reasons for doing this, I 
think collectively we have an essential reason for doing it, 
and that is, we need to keep the American economy going and we 
need to keep the service industries that American citizens need 
in place.
    We have a wonderful H-1B visa program to get, you know, the 
skilled workers we need, the high-skill, high-technology. We 
bring 600,000 workers a year into the United States. But when 
you talk about all the things that we ought to be doing as a 
way to legalize and formalize and improve this system, you have 
got to be very, very careful, Mr. Chairman, of where you put 
that responsibility. The INS works hard. They give the IRS a 
good name in terms of their ability to get things done in a 
timely basis. And if you look at what would happen, Senator 
Specter, if we took some of these people right now and put them 
on line to get a green card, you could be talking 6 to 10 
years. So that is why a guest worker program makes some sense 
because you could put people in a program--and, John, I don't 
care what we call it--in a formal way with all the protections 
that you might like to give them, and over time we could be 
sure that they earn their way into the system.
    On the matter that was discussed, very briefly, about 
Mexico and Canada and should they have a precedent, well, NAFTA 
has already demonstrated its essentiality by creating an 
extraordinary number of jobs in the United States. We are 
building a closer national security and national well-being and 
economic well-being in the NAFTA arrangement, and there may be 
a possibility to do something a little more creative there.
    Let me hit the second issue. We need stability in the 
workplace. Right now today, in any of your States, an illegal 
worker coming into the United States for $50 to $100 can get a 
set of credentials that are so perfect that you would hire them 
in your own office if you had a little business there. And John 
indicated a number of issues where perhaps they are not treated 
well. And there are places where we just have to make sure that 
we are not leveraging people one way or the other, that we know 
who is working for us, we know they are legal, we know that we 
can count on them over a period of time.
    Employers go to great lengths to make sure they are 
legitimate employers. By the way, we have people in every role 
of our society who we are not very excited about, and the 
Chamber of Commerce of the United States is not excited about 
every company in America. Some people behave the way we don't 
want them to behave. It is the same thing in John's 
organization. We want legitimate employment of people from 
other lands in a way that assures their rights and assures 
their safety and pays them in a comparable way that we would 
pay anyone else in the workforce.
    But as I indicated, there is a lot of leveraging going on. 
If you try and follow the system by following the rules, if you 
deal--and, by the way, you know from your own offices, when you 
are trying to get a green card arranged for somebody where it 
is the most legitimate and thoughtful thing that it ought to be 
done, I mean, it is very, very difficult.
    So here is my view: We need a temporary worker program but, 
more important, we need it so that we can figure out a way to 
transition from what we have to where we are going to get 
there. We need a transition system. And this might be a way to 
get around the problems with the INS and put a lot of people on 
a temporary worker program.
    We need to be very, very careful to understand that--and, 
by the way, Senator Specter, when the demand for immigrants is 
the highest for us, when our demand for workers is the highest 
and our provision of workers is the lowest is when Mexico is 
going to be having fewer workers for us. So we are going to be 
finding other places to get them.
    We need to understand we have to have those workers, or our 
economy doesn't work. And we need to figure out a way to do--I 
don't know whether it is an amnesty, whether it is an orderly 
transition to making these folks permanent workers. But we need 
to pick out the people that have paid their dues, that have 
paid their taxes, that have been good citizens, and find a way 
to do it. I would like to let John Sweeney have my way. I don't 
care what you call it. We need to get these workers 
legitimately into the United States economy and, gentlemen, you 
need more of them in the future, not fewer.
    I understand a little economic downturn, a little 
unemployment. Some of that is in areas we are never going to be 
back in business. But many of those workers are not prepared to 
do the work that these immigrants are doing right now.
    I would also say--and excuse me for taking just one other 
second--if we do this right, it is going to up the--it is going 
to stabilize the pay in this country, and I think it is going 
to up some of the pay in the lower-level jobs because we are 
not going to have this leveraging. Everybody gets paid the 
same. We know who they are, and I think you are going to be in 
business in a way that benefits everyone.
    I don't know how the details get worked out, but we have an 
extraordinary staff. We are prepared to participate in that, 
Mr. Chairman. I think we set an excellent tone yesterday with 
President Fox and President Bush raising this subject. I 
believe the White House, by the way, is dragging its feet a 
little more than it should. I wouldn't say it is political 
considerations. But if they are, they are on the wrong curve, 
and they ought to get busy on this matter. And while some would 
suggest that they are great friends of ours, they are, but when 
they are wrong, we tell them. And they ought to move very, very 
quickly on this matter.
    And so I am here because American business needs workers. 
John Sweeney is here because he understands that, but he would 
like to unionize them and protect them, God bless him. But, 
clearly, both of us understand a very simple issue: If we don't 
have workers here to run the American economy, that is a debate 
we can never have.
    Thank you very much, Mr. Chairman.
    [The prepared statement of Mr. Donohue follows:]

STATEMENT OF THOMAS J. DONOHUE, PRESIDENT AND CHIEF EXECUTIVE OFFICER, 
               U.S. CHAMBER OF COMMERCE, WASHINGTON, D.C.

    Mr. Chairman, I thank you for inviting me to speak before the 
Committee today on the issue of immigration reform, specifically in the 
context of the historic new relationship between the U.S. and Mexico. I 
am Thomas J. Donohue, President and Chief Executive Officer of the U.S. 
Chamber of Commerce, a business federation representing more than 3 
million individual companies and employers.
    The subject of this hearing is the U.S.-Mexico Migration 
Discussions and as the title of the hearing states, we believe there is 
an historic opportunity to build closer relations with our neighbor to 
the South. Mexico is our second largest trading partner, after Canada, 
and last year accounted for 10% of all our international trade. And we 
are Mexico's largest trading partner, accounting for 82% of Mexican 
exports and 70% of Mexican imports. Our relationship, however, goes far 
beyond trade in goods and services. It entails extensive commercial, 
cultural, and educational ties, as demonstrated by the annual figure of 
nearly 340 million legal crossings from Mexico to the United States in 
the fiscal year 1999. In addition, more than a half-million American 
citizens live in Mexico. More than 2,600 U.S. companies have operations 
there, and the U.S. accounts for 60% of all foreign direct investment 
in Mexico. Along the 2,000-mile shared border, state and local 
governments interact closely. We are therefore pleased that Presidents 
Bush and Fox are building upon this close relationship by cooperating 
on law enforcement, border management, economic development, and, of 
course, migration. With a shortage of workers in America, and a ready 
and willing workforce in Mexico, we have a unique opportunity to build 
a mutually beneficial immigration system. We need only to act.
    The Chamber strongly supports immigration and believes that 
immigrants are a driving force in our economy, both filling and 
creating jobs. They are also our best hope to curb chronic American 
labor shortages that are impeding the economy. The Chamber has been 
involved in efforts to increase the immigration of skilled workers 
under the ``H-1B'' program, to facilitate international transfers of 
personnel by allowing spouses to continue their careers, and to repeal 
potentially harmful provisions such as Section 110 of the 1996 
immigration act that would have created a new border bureaucracy that 
would have hurt trade and travel along our borders.
    The Chamber has members in all industries, employers of workers at 
all levels, and we have been increasingly hearing from Chamber members 
across the country that workforce availability issues are among their 
top priorities. In fact, in testimony earlier this year before the 
Senate Immigration Subcommittee, Elizabeth Dickson, Human Resource 
Specialist for Chamber member Ingersoll-Rand Corporation, and Chair of 
our Subcommittee on Immigration, related her company's difficulties 
recruiting skilled welders, service and repair technicians, and tool 
and die workers. We also have members in the restaurant, hotel, health 
care, manufacturing, construction and other industries who have asked 
the Chamber for help in finding and keeping the ``essential workers'' 
that keep our economy running. Yes, knowledge workers are the driving 
force for development and expansion of ideas and products. However, 
once these ideas are developed and the ideas become products, essential 
workers are needed to manufacture, deliver and service those products. 
We still must answer the question: Who will fill the millions of 
essential worker positions that we will create? Immigration must be one 
answer, but current law does not provide the solution.
    That is why the Chamber helped to found the Essential Worker 
Immigration Coalition (EWIC), comprised of organizations from across 
the economy, and continues to be a leader in that organization. For the 
Chamber, reform of essential worker immigration policy is a high 
priority.
    I know the President and the Congress are concerned about the state 
of the economy, as are we. But you should know that the recent slowdown 
has not significantly impacted the need for these workers. Over the 
last few years, we have seen unemployment rates as low as any time 
since 1950, and some local and regional unemployment rates are under 
2%. Employers continue to tell us they cannot find anyone to fill their 
jobs. According to a recent Employment Policy Foundation (EPF) study, 
the economy has more than 135 million jobs, and more than 9 million 
jobs have been created in the past five years. Further, workers who 
have lost jobs recently are finding new jobs at a faster rate than in 
the past--more than half find new jobs in seven weeks.
    Furthermore, this issue is not just one of the boom and bust cycle 
of our economy. We are facing a long-term worker shortage that is based 
on demographics. Secretary of Labor Elaine Chao in her recent Labor Day 
address noted the phenomenon of the ``Incredible Shrinking Workforce.'' 
Bureau of Labor Statistics (BLS) estimates show that the number of 
people in the labor force ages 25-34 is projected to decline by 2.7 
million in the next seven years. By 2008, the labor force age 45 and 
older will have the fastest growth rate and be a full 40% of the labor 
force. BLS also projects that by 2008 we will have 161 million jobs, 
but only 154 million workers. More than 60 million current employees 
will likely retire over the next 30 years. The EPF report also 
discusses the coming labor shortage, projecting a shortfall of 4.8 
million workers in 10 years, 19.7 million in 20 years, 35.8 million in 
30 years. The economic impact of this shortage is already being felt. 
But according to the EPF, failure to close the labor supply gap will 
lower Gross Domestic Product growth by at least 3 percent in 10 years 
and 17 percent in 30 years.
    Dr. Richard Judy of the Hudson Institute testified last February 
before a House Education and Workforce Subcommittee that:

        ``After 2011, the year in which the first of the Baby Boomers 
        turns 65, their flight to retirement will reach proportions so 
        huge as, barring unforeseen increases in immigration and/or 
        participation rates among the elderly, to reduce the total size 
        of the Nation's workforce.''

    In her Labor Day speech, Secretary Chao stated that not only must 
we find ways to integrate older workers, workers with disabilities, 
single moms and other nontraditional workers into the workplace, but 
also we must look to immigration. In this, she has echoed a sentiment 
expounded by Federal Reserve Chairman Alan Greenspan over the last few 
years--immigrants are good for our economy and support our workforce. 
As Chairman Greenspan recently stated before the House Financial 
Services Committee in July of this year:

        [T]his country has benefited immensely from the fact that we 
        draw people from all over the world. And the average immigrant 
        comes from a less benign environment, and indeed that's the 
        reason they've come here. And I think they appreciate the 
        benefits of this country more than those of us who were born 
        here. And it shows in their entrepreneurship, their enterprise 
        and their willingness to do the types of work that makes this 
        economy function.

    A February 2001 analysis by the Arizona Mexico Commission reached 
similar conclusions:

        The bottom line is that if the U.S. economy is producing jobs 
        faster than it is producing people to fill those jobs, foreign 
        labor must be accepted as a viable solution to the labor 
        shortage. In addition, we must acknowledge that the Baby Boomer 
        population is aging, and the total U.S.-born population, 
        without immigrants, is shrinking. All across the world, 
        increased immigration is seen as one solution to boost the 
        workforce that is needed to sustain economies. The foreign 
        worker, both legal and illegal, has been an integral part of 
        our inflation-free economic growth, and must be valued as a 
        contributor to our strong economy.\1\
---------------------------------------------------------------------------
    \1\ ``Labor Shortages and Illegal Immigration: Arizona's Three-
Pronged Strategy,'' Arizona-Mexico Commission, February 2001, pp. 4-5.
---------------------------------------------------------------------------
    We all now understand that immigrants are complementing our U.S. 
workforce, not displacing it. As we have made it a priority as a Nation 
for our workers to move into higher-paying, higher-skilled jobs, 
immigrant workers are filling the gap by taking many manual labor jobs 
that U.S. workers are avoiding.
    Many have stated that this economy no longer needs lower-skilled 
workers. Nothing could be farther from the truth. Almost three-quarters 
of the jobs in our economy do not require a college degree. Close to 
40% of the jobs require only short-term on the job training. Over the 
next ten years, the most job growth (i.e., in absolute terms) will be 
in occupations requiring less formal education or training. According 
to the Bureau of Labor Statistics, of the top ten occupations with the 
largest numerical job growth between now and 2008, all but two require 
less than a bachelor's degree; the majority (six) require only short-
term on-the-job training. These include: retail salespersons, truck 
drivers, personal care and home health aides, and office clerks. The 
next ten occupations with the largest job growth include nursing aides, 
janitors and cleaners, waiters and waitresses, and food counter and 
related workers. The top thirty include childcare workers, landscapers 
and groundskeepers, hand packers and packagers. Finally, the top ten 
occupations with the greatest retiree replacement needs (this group 
includes the occupations in which the average age of the current 
workforce is rapidly rising) include the following: secretaries, truck 
drivers, janitors and cleaners, registered nurses, bookkeeping and 
accounting clerks.
    These needs cut across industry sectors. The health care industry 
is facing severe shortages, not just of registered nurses, which is 
well documented, but also of certified nurse assistants, who provide 
75% of the care in nursing homes and long-term care facilities, as well 
as hospitals. The industry will create jobs for 600,000 Certified Nurse 
Assistants and 300,000 others over the next five years. According to 
the Department of Health and Human Services, the nursing home industry 
has a current shortage of 400,000 health care workers. The hospitality 
industry is also facing many unfilled jobs: the hotel industry 
estimates it will need an additional 700,000 workers in the next 
decade. The restaurant industry is looking at creating 2 million new 
jobs in the next ten years. In the construction industries, roofers are 
looking at an additional 50,000 workers needed in the next decade. In 
transportation construction, for every $1 billion invested in highway 
construction programs an additional 42,000 jobs are created.\2\ Overall 
the construction industry is expected to create 550,000 new jobs 
between now and 2008, according to the Bureau of Labor Statistics. The 
meat processing industry will create over 75,000 jobs. Transportation 
services--153,000.
---------------------------------------------------------------------------
    \2\ The Chamber is working with labor in support of a newly formed 
national coalition, Americans for Transportation Mobility, comprised of 
more than 300 organizations and strongly supports improving the safety 
and efficiency of our Nation's transportation infrastructure system. 
Such improvements will undoubtedly create additional jobs in this 
industry and benefit all Americans.
---------------------------------------------------------------------------
    Some will ask whether we have done everything we can to find 
workers for these jobs in the United States. The answer is yes, and we 
are continuing to do so. Through the Center for Workforce Preparation, 
the Chamber's non-profit affiliate, we have taken a strong role in 
addressing the critical shortages in the availability of skilled and 
unskilled workers that business is experiencing today. Current efforts 
of the Center include the following:

        Identifying and supporting programs that bring new sources of 
        labor to ``work readiness''--former welfare recipients, people 
        with disabilities, recent retirees, and others.
        Partnering with Job Corps, the U.S. Departments of Labor and 
        Education and others in efforts to develop worker training 
        programs that address and meet current business needs.
        Helping the Chamber's federation of 3,000 state, local and 
        metro chambers of commerce to effectively engage in workforce 
        development by providing tools, models and best practices for 
        implementation at every level. Especially critical in this 
        effort has been the development of a school-to-career guidebook 
        to ensure that tomorrow's workers have the skills to succeed.
        Informing businesses of the resources and opportunities 
        available to them and their employees to obtain education and 
        training.

    Of course, I would be happy to provide the Committee members with 
additional information about these efforts, at your request.
    The industries that we are talking about are some of the leaders in 
the Nation's welfare-to-work, school-to-work, and prison-to-work 
efforts. Because many of these jobs are entry-level, requiring little 
or no experience, and often few skills, they are the stepping-stone for 
many on their road to the American dream. Employers are doing 
everything reasonable they can to fill these jobs, but still the jobs 
are going begging.
    Members of the Committee, I believe I have adequately demonstrated 
our need. Now we must look to solutions. As stated above, we continue 
to do all we can to ensure that we are utilizing our domestic 
workforce, but because of the current lack of available job applicants, 
and the future demographics that threaten our economy, we must look to 
our immigration system to help ``fill the gap.'' However, as you are by 
now aware, our current immigration system does not allow us to access 
this potential pool.
    We have a current temporary labor program, called the ``H-2B'' 
program. The H-2B visa is a temporary visa issued to individuals who 
will be working in temporary, seasonal jobs outside of agriculture. The 
H-2B process is a cumbersome and bureaucratic one that involves two 
separate agencies, a lot of paperwork, and often more time than the job 
itself will last. In the past, this red tape has meant that very few 
employers bothered to use the program, although in recent years its use 
has escalated due to the tight labor market.
    While many employers do have seasonal needs and changes to the H-2B 
category are warranted to make it easier for employers to use, many 
more employers have year-round and long-term needs that are not 
fulfilled. Such employers seeking to hire foreign nationals for their 
job openings are out of luck, since no long-term temporary visa exists 
in our current system. There is no ``H-1B'' counterpart for essential 
workers, as exists for high-skilled jobs. If an employer has a long-
term position, there is no legal mechanism to sponsor foreign nationals 
to fill that need.
    If the employer would like to sponsor a lower-skilled worker 
permanently, he or she is, as a practical matter, out of luck. Current 
annual quotas limiting green cards to only 5000 green cards each year 
for persons coming to work in jobs that require less than two years of 
education or training mean a five to ten year wait.
    In sum, we have a current situation in which our Nation has 
millions of jobs available, a decreasing workforce relative to the 
number of openings, and an immigration system that provides no 
practical legal mechanism for employers and foreign nationals to fill 
those openings. Is it any wonder we have such a large number of 
undocumented workers in this country?
    And what about those workers? These individuals are here and 
working, many of them paying taxes.\3\ You may ask how are they 
working? The answer is simple. Under the current law, an employer must 
verify that each employee is eligible to work in the U.S. But the 
employees can choose which documents from the INS-approved list (set 
out on the so-called I-9 form) to present to support their claim that 
they can work legally. As long as the documents look valid on their 
face, the employer must accept them. To ask for additional 
documentation because someone may look or sound foreign is potentially 
a violation of that person's civil rights under both immigration and 
employment laws. Because of the prevalence of false, yet credible, 
documents, many employers simply do not know their employees are 
undocumented. Employers only learn of this situation after an INS raid, 
or when the Social Security Administration sends a so-called ``no-
match'' letter telling them that their employee's records don't match 
the government's.
---------------------------------------------------------------------------
    \3\ For example, an April 15, 2001 article in the Washington Post, 
``Illegals Paying Millions in Taxes,'' noted that according to internal 
Social Security Administration documents, ``Over the eight-year period, 
the mystery workers [presumed to be undocumented workers] were 
responsible for more than $20 billion paid in Social Security taxes--
but they recieved no credit for them. Their payments have helped 
contribute to the system's surplus. . . .''
---------------------------------------------------------------------------
    The result is that the employer must dismiss these employees, if 
they have not already left of their own volition.\4\ As you can see, to 
an employer who is already facing labor shortages, this instability in 
the workplace is adding salt to the wound.
---------------------------------------------------------------------------
    \4\ The case of one roofing contractor in the Northwest illustrates 
the point. The INS came in to ``audit'' this company's employment 
verification records. Although the INS found no violations by the 
employer, it was told that a large portion of its workforce was 
undocumented (most of whom had already fled). The employer told the INS 
agents that these were some of his best employees, and that they would 
only go to work for his competitors, which indeed they did. The INS' 
only response was that this was ``standard procedure.''
---------------------------------------------------------------------------
    So we have two major problems to deal with--filling the unfilled 
jobs, both now and in the future, and keeping our current workforce. In 
looking toward the U.S./Mexico discussions, we believe that any outcome 
must address both problems. That is why the Chamber supports a 
comprehensive approach to this issue. We must develop new, legal 
immigration methods, which, as President Bush has stated ``match a 
willing employee with a willing employer.''
    We would support new temporary worker programs that would 
accomplish this ideal in a manner that is fast, efficient and fair to 
all parties concerned. While the specifics of how such a program would 
work are fair game for experts in the field, businesses want a system 
that is simple, easy to understand, and responsive to their needs in a 
timely manner. We also realize that protections to prevent possible 
abuses and to help ensure that the interests of American workers are 
protected must also be included. But the system must not become so 
encumbered with bureaucratic hurdles as to be, as a practical matter, 
unworkable.
    We would also like some flexibility in the system. While a 
temporary worker program would allow individuals to begin work in the 
U.S. relatively quickly, and, further, to meet the needs of those 
individuals who wish to travel back and forth to their home country, 
there may exist situations where a ``willing employer and a willing 
employee'' would like the relationship to continue on a more permanent 
basis. There should be an ability for that individual, under certain 
circumstances, to have a path to permanent residence, a ``green card.''
    Finally, we believe that those who have already demonstrated their 
commitment to the United States by living here, working and paying 
taxes, should have a means by which they can earn permanent residence. 
There are many possible ways to accomplish this that are being 
discussed by the policy-makers; but we simply want to ensure that some 
of our best workers can stay and continue their contributions to their 
employers and communities.
    One final word. We understand that the current discussions are 
between the United States and Mexico, which befits one of the largest 
trading partnerships in the world. Our relationship with Mexico is, in 
many ways, unique. However, employers do not select their employees by 
nationality, and while a new temporary worker program may be useful to 
``test'' with Mexico, especially if it envisions a specific role for 
the sending country's government, we would like to see other nations be 
able to participate as well in the near future. Moreover, when we are 
discussing the so-called ``regularization'' of individuals already in 
the United States, equity would seem to suggest that we allow nationals 
of other nations the same opportunity for lawful status. A proposal 
that would apply to a single nationality could very well prove 
unworkable and might lead to discrimiNation against other 
nationalities, for fear of their immigration status.
    While the details of these proposals are yet to be worked out, we 
are very supportive of the discussions between President Bush and 
President Fox, and we are hopeful that an agreement may be reached that 
all parties represented here today will be able to support.
    I welcome any questions you may have.

    Senator Kennedy. Raul Yzaguirre. We are glad to have you 
here, Raul. We look forward to hearing from you. It seems you 
have wrapped your arms around Tom Donohue and John Sweeney, 
too.
    Senator Brownback. That would be a nice picture, if you 
wanted to end up that way. That would be a good picture.
    Mr. Donohue. Actually, he is from Ireland as well.
    Senator Brownback. Oh, so this is now an Irish panel.
    [Laughter.]

STATEMENT OF RAUL YZAGUIRRE, PRESIDENT, NATIONAL COUNCIL OF LA 
                     RAZA, WASHINGTON, D.C.

    Mr. Yzaguirre. Mr. Chairman, with your permission, I would 
like to summarize my testimony and ask that the full text of my 
comments be inserted in the record.
    First of all, let me associate myself with the comments of 
you and the other members of the Subcommittee. You almost made 
my testimony for me. Also, let me thank you and congratulate 
you for passage of 245(i). We really appreciate that piece of 
legislation.
    My name is Raul Yzaguirre. I am the president of the 
National Council of La Raza, the Nation's largest Latino civil 
rights organization. I appreciate the opportunity to appear 
before the Subcommittee today.
    Mr. Chairman, I want to make it very clear that I believe 
that Congress has a major opportunity to shape immigration 
policy in a way which makes sense and serves the national 
interest. It is almost impossible to describe to you how 
important this opportunity is to the Nation's Hispanic 
community. When the news broke that the Bush administration 
might be considering a legalization program, NCLR was opening 
its annual conference in Milwaukee. The thousands of Latino 
leaders gathered there were electrified by the news. The 
response from within our community, as demonstrated by polls, 
media coverage, organizing, and energy in communities 
throughout the country, has been truly extraordinary.
    Mr. Chairman, let me be clear. Latinos agree with the 
fundamental underlying principle of the immigration debate, 
which is that as a sovereign Nation, the United States can and 
should control its borders. However, we also believe that the 
enforcement of immigration laws, like that of all laws, must be 
non-discriminatory, fair, and consistent with American values.
    Over the last 15 years, our immigration laws have been 
based on the premise that there is no place in the United 
States labor force for migrants from Mexico and other 
countries. Clearly, that premise is wrong. Despite an 
increasingly harsh enforcement regime, immigrants have made an 
important place for themselves in the labor force.
    NCLR believes that negotiations between the United States 
and Mexico and the congressional debate they have inspired 
provide an historic opportunity to reshape immigration policy 
in a way that is responsive both to labor market needs in the 
United States and the needs of immigrants themselves. My 
written statement contains a set of six policy principles for 
your consideration. I will highlight two of them for you now.
    Number one, legalization must be a major element of any 
policy change. A substantial number of undocumented immigrant 
workers are long-term U.S. residents. They work hard, pay 
taxes, and otherwise abide by our laws. Their futures are 
inextricably linked with ours. The interests of the U.S. are 
best served by allowing these long-term residents to come out 
of the shadows. Those who can demonstrate that they have made 
commitments and have linked their future to America's future 
should be afforded the opportunity to legalize, regardless of 
where they are from.
    Number two, any temporary worker program that might emerge 
from this debate must be markedly different from the status 
quo. We acknowledge the reality that some undocumented workers 
have come to the United States with the intention of returning 
to their home countries. They do not seek to be permanent 
immigrants and often end up trapped in the United States 
because our border control policies make it too difficult to 
depart and re-enter, swelling the ranks of the undocumented. It 
is reasonable, then, to construct a temporary worker framework, 
particularly to regularize future worker flows. However, this 
must be markedly different from the existing temporary worker 
construct. In particular, it is essential for any workers who 
participate to be fully covered by U.S. labor laws, including 
the right to change employers, strong protection for wages and 
working conditions, the right to unionize, and the ability to 
keep their families together. Similarly, it is essential that 
such laws be vigorously enforced, by strengthening the Wage and 
Hour Division at the United States Department of Labor, as well 
as by ensuring that these workers have access to legal 
services. Finally, any temporary worker program must also 
include a path to adjustment of status for its workers; that 
is, if their labor is needed here year after year, they should 
be able to choose to remain in the United States as immigrants, 
having demonstrated that their labor is of value here.
    In conclusion, Mr. Chairman, the United States stands at 
the threshold of an important opportunity to finally bring 
rationality and justice to its immigration laws after decades 
of failed experiments. Our current immigration law is 
inconsistent with our economic interests, undermines our 
fundamental values, and is riddled with hypocrisy. Americans 
know that we rely on the labor of these hard-working people, 
and there is strong evidence that they are likely to support 
your leadership in doing something about it. Some say we should 
do nothing, arguing that legalization would ``undermine the 
rule of law.'' But it is hard to imagine any situation more 
likely to encourage disrespect for the law than the hypocrisy 
inherent in the status quo.
    Mr. Chairman, the discussions between the United States and 
Mexico have left open the door to the possibility of reform and 
the enactment of an immigration law that begins to realign our 
immigration laws with America's best traditions and values, as 
well as the economic realities that drive migration. I urge you 
to move forward and make these reforms a reality.
    Thank you very much, Mr. Chairman.
    [The prepared statement of Mr. Yzaguirre follows:]

 STATEMENT OF RAUL YZAGUIRRE, PRESIDENT, NATIONAL COUNCIL OF LA RAZA, 
                            WASHINGTON, D.C.

                              Introduction

    My name is Raul Yzaguirre; I am the President of the National 
Council of La Raza (NCLR). NCLR is a private, nonprofit, nonpartisan 
organization established in 1968 to reduce poverty and discrimiNation 
and improve life opportunities for Hispanic Americans. NCLR is the 
largest constituency-based national Hispanic organization, serving all 
Hispanic nationality groups in all regions of the country through our 
network of over 250 affiliate community-based groups and regional 
offices. NCLR has supported fair and effective immigration policies for 
over two decades, and has provided a fact-based Latino perspective on 
the issue of immigration. NCLR approaches this issue as a civil rights 
organization, with an interest in protecting the rights of our 
constituency within the United States and promoting the values and 
principles of the Nation as a whole. I appreciate the opportunity to 
appear before the Subcommittee today.
    Mr. Chairman, I want to make it very clear that I believe that this 
committee, the Congress as a whole, and the Bush Administration are 
poised on the verge of a major opportunity to shape immigration policy 
in a way that makes sense and serves the national interest. It is 
almost impossible to describe to you how important this opportunity is 
to the Nation's Latino community. I can tell you that when the news 
broke that the Bush Administration might be considering a legalization 
program, NCLR was opening its Annual Conference. The thousands of 
Latino leaders gathered for the Conference were electrified by the 
news. The response from within our community, as demonstrated by polls, 
media coverage, organizing, and energy in communities throughout the 
country, has been extraordinary. I can also say that my colleagues in 
the National Hispanic Leadership Agenda (NHLA), a coalition of the 
major organizations in the Latino community, have spoken out on the 
issue in letters addressed to President Bush, President Fox, and the 
U.S. Congress. I have attached a copy of these letters to my written 
statement.
    The reason for the intensity of focus within the Latino community 
on this issue is only partly related to the fact that a substantial 
number of the Nation's Latinos are immigrants themselves. In fact, 
according to the 2000 Census, the majority of U.S. Latinos (60%) are 
natives of the United States. Nevertheless, Latinos across the country, 
immigrants or not, feel the impact of immigration policy because we 
live in immigrant families and communities, and many of us, like most 
Americans, have strong memories of our immigrant heritage. But 
immigration is also an issue of powerful symbolism for us. The debate 
on immigration policy often feels like an indicator of respect--or the 
lack of it--for the contributions of the larger Latino community to our 
common nation, even though most of us are not immigrants. We are also a 
community that believes in justice, and the injustice of the Nation's 
current immigration policy, much of which was crafted in a heavily 
anti-immigrant era, is offensive to America's best traditions and 
values. We feel connected to the experience of immigrants whose 
contributions to our Nation are ignored by our laws and by the larger 
community, and who too often experience abuse as a result. During the 
last several months we have sensed that America has an historic 
opportunity to reshape immigration policy in a way that remedies 
fundamental injustice, saves lives, honors the hard work of immigrants 
which our Nation clearly relies on, and deals sensibly with the 
difficult question of the future migration flow. We believe strongly 
that it is in the Nation's best interest to maximize this opportunity; 
indeed, now that the door is open to the possibility of reforms that 
make immigration policy consistent with economic reality and America's 
most cherished values, we will insist on getting the job done right.

                II. The Opportunity to Shift the Debate

    In general, NCLR agrees with the major underlying principle of the 
immigration debate, which is that, as a sovereign nation, the United 
States can and should control its borders. However, NCLR also believes 
that the enforcement of immigration laws, like that of all laws, must 
be nondiscriminatory and consistent with American values. NCLR also 
believes that, for the last 15 years, one fundamental premise of 
immigration law has been in error. That is, the Immigration Reform and 
Control Act of 1986 (IRCA) was based on the premise that there was no 
place in the U.S. labor force for migrants from Mexico and other 
countries. Clearly, that premise was in error; indeed, most of the 
sectors that supported the law and its premise have reached the 
conclusion that, despite an increasingly harsh enforcement regime, 
immigrants have made an important place for themselves in the labor 
force. For this reason, leaders in both the business community and the 
labor movement are together arguing that the legalization of these 
workers is in the national interest.
    NCLR believes that a combiNation of factors demonstrate that U.S. 
immigration policies have failed to achieve their objectives and are in 
fundamental conflict with national needs and values In particular:
    The population of undocumented immigrants living and working in the 
U.S. has grown steadily since the 1986 immigration reforms. Despite the 
imposition of penalties against employers who hire undocumented persons 
and heightened border controls, a substantial and growing number of 
undocumented workers have found a place in the U.S. labor force. 
Credible estimates from the Immigration and Naturalization Service 
(INS) and the Urban Institute estimate that the size of this population 
is between six and nine million. In addition to the population that 
crosses the U.S.-Mexico border illegally, as many as 40% of 
undocumented migrants enter on valid visas and overstay them, according 
to INS. As long as the U.S. economy needs additional workers, 
immigrants will continue to come, even at great risk to their safety.
    Enforcement of immigration laws at the border and the interior is 
conducted in a way that undermines civil rights. There is widespread 
evidence of the use of racial profiling in immigration enforcement and 
of collaborations between immigration and local law enforcement 
officials, which have the effect of undermining the civil rights of 
citizens and legal residents who are mistaken for illegal immigrants 
based solely on ethnic appearance. In addition, independent studies by 
government and private agencies have shown that the employer sanctions 
policy, through which employers check the documents of new hires, has 
caused a widespread pattern of employment discrimiNation against 
persons lawfully in the U.S. and U.S. citizens.
    An alarming and unacceptable number of deaths take place each year 
at the U.S.-Mexico border. Since the initiation of Operation 
Gatekeeper, a major border control initiative in the mid-1990s, at 
least 1700 migrants have lost their lives crossing rivers, deserts, and 
mountains to find work in the U.S. Just last week, ten more migrants 
died crossing the U.S.-Mexico border. As you can imagine, like all 
Americans, Latinos are horrified by this unacceptable price for our 
policies. It's important that we all remember that these are not simple 
statistics; in a highly emotional event at our Annual Conference last 
year, NCLR commemorated each and every migrant who perished at the 
border. We read their names and ages, one at a time, to remind 
ourselves of our responsibility to those who lost their lives while 
seeking the American dream.
    In addition to these compelling issues that highlight the need for 
policy change, there is increasing evidence that a significant 
legalization program is needed to maintain U.S. economic growth:
    Key growth sectors of the economy increasingly rely on this labor 
force. Representatives of industries in the service sector, like 
hotels, restaurants, and nursing homes have formed an Essential Worker 
Immigration Coalition (EWIC) which argues in favor of more generous 
immigration policies, including the legalization of those already in 
the U.S. workforce. These employers note that widespread labor 
shortages are a significant constraint on economic growth.
    The labor movement argues that legalization of the undocumented 
workforce is vitally important for protecting the overall U.S. 
workforce. The AFL-CIO, in a unanimous decision by its executive 
council in February of 2000, took the position that the best way to 
protect all U.S. workers is to legalize those who are in the workforce 
without immigration papers. Unions argue that employers can ignore 
labor laws and undermine organizing campaigns for those workers who 
lack immigration status, because workers who complain run the risk of 
deportation. This dramatic shift in labor movement policy underscores 
the scale and importance of the undocumented workforce.
    These developments are consistent with the views of economic 
experts who confirm the overall benefits of immigration A recent study 
by the North American Integration and Development Center at the 
University of California, Los Angeles estimates that undocumented 
workers from Mexico (3 million workers) contribute $154 billion to the 
US GNP and $77 billion to the GSP of California alone. In 1997, the 
prestigious National Academy of Sciences found that immigrants 
contribute about $10 billion to the Nation's economy per year and pay 
more in taxes than they use in services. In addition, in Congressional 
testimony presented in July of 2001, Federal Reserve Board Chairman 
Alan Greenspan said, ``I've always argued that this country has 
benefited immensely from the fact that we draw people from all over the 
world. And the average immigrant comes from a less benign environment, 
and indeed that's the reason they've come here. And I think they 
appreciate the benefits of this country more than those of us who were 
born here. And it shows in their entrepreneurship, their enterprise, 
and their willingness to do the types of work that make this economy 
function.''
    There is substantial evidence that the American public is prepared 
to support substantial reforms. A recent poll conducted by a bipartisan 
team, Lake Snell Perry & Associates and The Tarrance Group, sheds light 
on the public's view of these issues. They found that while voters are 
divided on the issue of legalization before they hear details of a 
proposal, once the issue is explained in terms of undocumented 
immigrants who can prove that they have lived, worked, and paid taxes 
in the United States, 59% of American voters, reflecting every 
demographic group, support the proposal.Indeed, NCLR believes that it 
is more clear than ever to the American public that our economy depends 
on this labor force, and that it is not in the national interest to 
allow the status quo to continue.

                 III. Principles for the Current Debate

    NCLR believes that negotiations between the United States and 
Mexico, and the Congressional debate that they have inspired, provide 
an historic opportunity to reshape immigration policy in a way that is 
responsive both to labor market needs in the U.S. and the needs of 
immigrants themselves.In particular, these discussions could create a 
coherent and more effective alternative to the current immigration 
control regime, which is ineffective, discriminatory, and inconsistent 
with both our national values and economic interests. However, this 
process also creates substantial risks. In order to maximize positive 
policy opportunities and minimize dangers, NCLR believes:

        1) Legalization must be a major element of any policy change. A 
        substantial number of undocumented immigrant workers: are long-
        term U.S. residents, work hard, pay taxes, and otherwise abide 
        by our laws. Their futures are inextricably linked with ours. 
        The interests of the U.S. are best served by allowing these 
        long-term residents to come out of the shadows. Those who can 
        demonstrate that they've made those commitments and have linked 
        their future to America's future should be afforded the 
        opportunity to legalize.While this discussion is taking place 
        in the context of negotiations between the U.S. and Mexico, it 
        makes little sense from the U.S. perspective to provide 
        legalization opportunities only for Mexicans; all those 
        similarly situated should have the same opportunity.
        2) Temporary worker programs by themselves are not a viable 
        long-term policy option. The Nation's history with guestworker 
        programs, which have mostly applied to agriculture, has been a 
        highly negative one. NCLR has opposed all proposed expansions 
        to these programs because they undercut workers rights by 
        offering few labor protections, tie workers to individual 
        employers, and provide no opportunities for adjustment of 
        status. Indeed, temporary worker programs have become notorious 
        in the Latino community because of their history--and reality--
        of abuse. There is a real danger that the current debate will 
        simply follow the structure that has been in place since the 
        days of the bracero program; indeed, one such proposal is being 
        talked about in the U.S. Senate. If such a proposal were to 
        emerge from the negotiations between the U.S. and Mexico, or in 
        the legislative process, NCLR would have no choice but to 
        oppose it vigorously.
        3) Any temporary worker program that might emerge from this 
        debate must be markedly different from the status quo. We 
        acknowledge the reality that some undocumented workers come to 
        the U.S. with the intention of returning to their home 
        countries. They do not seek to be immigrants, and often end up 
        "trapped" in the United States because our border control 
        policies make it to difficult to depart and re-enter, swelling 
        the ranks of the undocumented. It is reasonable, then, to 
        construct a temporary worker framework, particularly to 
        ``regularize'' future worker flows. However, this must be 
        markedly different from the existing temporary worker 
        construct. In particular, it is essential for any workers who 
        participate to be fully covered by U.S. labor laws, including 
        the right to change employers, strong protections for wages and 
        working conditions, the right to unionize, and the ability to 
        keep their families together. Similarly, it is essential that 
        such laws be vigorously enforced, by strengthening the Wage and 
        Hour division at the U.S. Department of Labor as well as by 
        ensuring that these workers have access to legal services. 
        Finally, any temporary worker program must also include a path 
        to adjustment of status for its workers; that is, if their 
        labor is needed here year after year, they should be able to 
        choose to remain in the United States as immigrants, having 
        demonstrated that their labor is of value here.
        Immigration enforcement must be conducted strategically. Even a 
        successful temporary worker structure would not eliminate the 
        need to conduct immigration enforcement at U.S. borders and the 
        interior. But this enforcement must be conducted strategically, 
        aimed at large scale smugglers and employer networks that 
        deliberately import workers from other countries in order to 
        skirt U.S. wage and other laws that aim to protect workers. 
        Enforcement at the border and the interior must also be 
        conducted according to a strict set of standards to protect the 
        civil and human rights of those who come into contact with 
        enforcement personnel. In addition, the ineffective and 
        discriminatory employer sanctions regime should be replaced by 
        a new system that emphasizes labor law enforcement and 
        eliminates the economic incentive for unscrupulous employers to 
        hire unauthorized workers.
        5) Economic development efforts must be targeted to create 
        opportunity in areas where migrants originate. If the 
        experience of the 15 years since IRCA has taught us anything, 
        it is that even the toughest laws, vigorously enforced, are no 
        match for the economic forces that drive migration. As the U.S. 
        properly revises the laws that affect what happens within its 
        borders, it must also look closely at the so-called ``push'' 
        factors that drive migration. In the long term, if we wish to 
        alter the migrant stream that originates in Mexico and other 
        countries, we must include economic development in those 
        communities as part of our overall migration strategy.
        6) The situation of agricultural workers is a special case that 
        must be considered carefully. NCLR believes very strongly that 
        no policy reforms affecting immigrants would be complete 
        without taking into account the particular concerns of the 
        farmworker community, which is overwhelmingly Latino with a 
        significant proportion of undocumented immigrants. It is also 
        true that the agricultural sector operates under an entirely 
        different set of rules than the rest of the labor force, 
        including far weaker labor protections. This, along with a 
        history of temporary worker programs that offer unsufficient 
        protections to workers, has contributed to an abysmal situation 
        for America's farmworkers which has not improved for decades. 
        Recently, representatives of the agricultural industry and the 
        United Farmworkers of America held historic discussions and 
        agreed in principle on a set of policy alternatives that both 
        sides can live with. Though the results of these discussions 
        have not yet been presented as a legislative proposal for 
        others to respond to, NCLR believes that these organizations 
        have moved the debate forward in a positive direction. If the 
        negotiated agreement has not moved forward on its own as 
        immigration legislation proceeds, it is important to ensure 
        that its provisions are reflected in broader immigration 
        reforms.

                             IV. Conclusion

    In conclusion, Mr. Chairman, the United States stands at the 
threshold of an important opportunity to finally bring rationality and 
justice to its immigration laws after decades of failed experiments. 
Our current immigration law is inconsistent with our economic 
interests, undermines our fundamental values, and is riddled with 
hypocrisy. To potential immigrants our law shouts, ``We don't want 
you!'' while our economy whispers, ``Come on over, we need your 
labor.'' Our law says hiring undocumented workers is illegal, but winks 
at the existence of an unauthorized workforce demographers estimate to 
be 6-9 million people. The law is supposed to protect American jobs; 
instead, it tolerates a subclass of undocumented workers with no labor 
rights, thus undermining wages, working conditions, and organizing 
opportunities of all workers. We sanctify ``family values,'' while 
spouses and children of U.S. citizens abroad must wait years to come 
here legally because of lengthy INS backlogs; it shocks no one that 
many choose to reunite with their families, even if its means entering 
or staying illegally. Some say we should do nothing, arguing that 
legalization would ``undermine the rule of law.'' But it's hard to 
imagine any situation more likely to encourage disrespect for the law 
than the hypocrisy inherent in the status quo.
    Mr. Chairman, the discussions between the United States and Mexico 
haveleft open the door to the possibility of reform and the enactment 
of an immigration law that begins to realign our immigration laws with 
America's best traditions and values, as well as with the economic 
realities that drive migration. I urge you to move forward and make 
these reforms a reality.

    Senator Kennedy. Thank you very much.
    Mr. Sweeney, one of the concerns that labor has had 
historically has been that the number of undocumented workers 
that have come into the United States have a depressing effect 
on the wages of American workers. I would like to know your 
thoughts on the issue. What are your feelings about that now? 
How concerned are you that if we have a program of 
normalization, of these workers, do you think that that will 
depress the wages of our American citizens now, whether they be 
as a result of citizenship or because they were born here?
    Mr. Sweeney. No, Senator. Quite the contrary, I really feel 
that true immigration reform, giving permanent legal status to 
these workers and to all immigrants--this is not just about one 
ethnic group; it is about all immigrants--and providing 
workplace protections is going to improve their lives and going 
to bring stability, as Tom Donohue mentioned in his remarks. I 
think also that this will not only stabilize but will improve 
the lives of these workers and will satisfy or put to rest 
whatever concerns there might be, because it is quite the 
contrary now. In many cases we are seeing workers being 
exploited and even being paid less than the minimum wage and 
the wage and hour laws not being enforced. And I think that 
that is one of the reasons that we are so strongly advocating 
true immigration reform.
    Senator Kennedy. So your position is that the exploitation 
is going on now and that these workers may be taking jobs away 
from Americans working for subsistence or less than subsistence 
wages and that that is depressing, while if they have their 
situation adjusted and their rights protected, that whole group 
of workers will be able to have a dollar's pay for a dollar's 
work.
    Mr. Sweeney. They will get the same protection and the same 
wages as other workers in their industries and in many cases 
working alongside of them. We had a rally on the steps of the 
Capitol, or a press conference the other day, and had a number 
of workers from different countries around the world who are 
victims of the discrimiNation and exploitation. We also had 
workers who are U.S.-born workers who are working alongside of 
these workers tell us stories about the wage differences and 
the gaps that exist in terms of benefits and so on, and there 
is a strong feeling among workers that with immigration reform 
it will be the fair and just way to address this situation.
    Senator Kennedy. Let me ask you, Mr. Donohue, the Chamber 
supports the legalization as a component of immigration reform. 
Why?
    Mr. Donohue. I think this is a sequence. First of all, we 
need 8 or 9 million or 11 million workers, whatever it is now. 
There are going to be some more. And our support for 
legalization is a process. It is not an immediate waving of a 
wand. I don't think everybody that is here in this country 
ought to be legalized overnight. I think there ought to be a 
progression in that direction.
    If we sent all 8 or 9 million workers home tomorrow, we 
would figure out a way to get them back the next day. They 
would come here somehow. And I believe that we need to have a 
legalization issue because many of these folks are essential to 
our economy. They have earned the respect and the right to be 
workers for the many years that they have worked here and their 
contribution to the economy. And I don't sit here as an expert, 
Mr. Chairman, and tell you how to do that, but I think we 
need--that is why I think a guest worker thing--we will call it 
something else if John wants--so that we can identify folks, 
puts them on a sequence that gets them approved and gets them 
an orderly invite and participation in our workforce. And then, 
by the way, we have to start thinking about what are we going 
to do going down the road when we are going to need incremental 
workers because of all the retirements and all the demand.
    So I think you are really challenged in the Committee to 
find two solutions: one to our current situation, and as you 
said in some of your opening remarks, and as Senator Brownback 
and others did, we don't want to reinvent this problem going 
down the road 10 years from now or 5 years from now. So let's 
figure out a way to meet our worker needs.
    I agree with Mr. Sweeney that this will stabilize the wage 
base. I agree that probably you can find examples of abuse. I 
hope to get rid of them, although most of the illegal 
immigrants are engaged with companies and organizations that 
treat them fairly. There are exceptions, I agree to that. So I 
think, Mr. Chairman, we have to find something to do now. We 
have to find something to do later. And legalization as a part 
of that process I think is in order, but not a wholesale, wave 
the wand, everybody is legal.
    Senator Kennedy. From the business community's view, is it 
desirable to have immigration policy that is only for Mexicans, 
or are you prepared to make this recommendation with regards to 
all of the undocumented?
    Mr. Donohue. Well, first of all, all of us sitting here, by 
the way, are from families that in one form or another have 
emigrated here. And I certainly believe that it ought to be 
very broad-based in terms of who is working here and how they 
might work into the system and how others may be able to come 
here in years forward.
    The only reason that all of us are focusing on the Mexican 
issue with such intensity is that a large, large number of the 
immigrants that are illegally or semi-illegally working here in 
the United States is because they walked here, you know, or 
they drove here and because, if you think about California and 
Florida and Arizona and Texas and the industries that have 
sprung up there, as well as other places in your own States, 
there has been a great opportunity to hire Hispanics.
    We just announced the other day--at another time I hope we 
can talk, Mr. Chairman--a massive issue, working very closely 
with the labor unions, to encourage Government to continue to 
invest in all the infrastructure they collect money for. The 
labor union leaders, one of the first things they wanted to 
talk about was the immigration issue and how not only do we 
have to fix this up, Tom, but we need more of them. And this is 
a very difficult, emotional, and political issue, but the 
bottom line is this is not a matter of choice. This is a matter 
of the people we need to work in this economy and to pay jobs, 
and some of them John will organize.
    Senator Kennedy. Raul, I would like to ask you this 
question: The opponents of legalization say that legalizing 
undocumented persons would only be rewarding criminals. Yet we 
haven't really examined what that means. The presence of 
undocumented workers is tolerated because their labor has 
become so important to our economy, as we heard again today. 
Indeed, we have come to depend on this labor. Undocumented 
immigrants themselves are here for no more sinister a reason 
than to work hard and provide a decent life for their families. 
If this is criminal, how seriously should it be punished?
    Could you comment on the rhetoric being used in the debate 
for those that are opposed to normalization?
    Mr. Yzaguirre. Thank you, Mr. Chairman. It is a pernicious 
use of language to call somebody who is trying to find a job 
and trying to feed his family and trying to act in the best 
traditions of America a criminal. But if it is criminal, then 
we are all criminals in the sense that we are all benefiting 
from that criminality. We are all conspirators after the fact. 
You know, we are all--when we go to a restaurant and we eat a 
meal, we enjoy the profit of their work. When we buy a head of 
lettuce that is a lot cheaper because of the presence of 
undocumented workers, we are co-conspirators in that 
criminality, if you will.
    So if it is criminal, then all of us, Mr. Chairman, are 
criminals, and I don't think that is the case.
    Senator Kennedy. Good answer.
    [Laughter.]
    Senator Brownback. No rebuttal.
    Senator Kennedy. Senator Brownback?
    Senator Brownback. Thank you, Mr. Chairman.
    This is an impressive panel. May I suggest to you that if 
we could take this on a road show, it would be very helpful 
across the country and across even the Capitol, here to the 
other side of the Capitol would be good, too.
    The President has noted we had, I think, an excellent week 
to really bring this topic to the forefront of the thinking 
across America, a number of people across the American public. 
And your coming together here I think is a great statement as 
well.
    We need to move this debate forward across the Nation and 
not just in Washington, and so I am hopeful that your groups 
will continue to work together in forming a broad-based, left-
right coalition, however you want to designate it, to press 
this issue because anytime we have discussed immigration, 
immigration reform, immigration issues in the United States, if 
you look at the history of that--and I am just recently on this 
panel, but the history of this is pretty clear. These have been 
raucous debates, have been difficult issues in the country. For 
whatever reason, even though we are a Nation of immigrants, we 
all acknowledge that, but for whatever reason, this is always a 
difficult one for us to have. And your organizations represent 
key groups that could really, I think, soften the tone and 
tenor and bring some sanity and rationality to that debate. And 
I would really like to encourage you to do that, to join arms 
as much as you would be willing to do, because this will be--no 
matter how you put it, this is going to be a difficult debate 
on Capitol Hill.
    If I look at the calls into my office, this is going to be 
a--this will be a difficult debate and discussion. And as 
Senator Specter mentioned, at the town hall meetings that he 
had, this is going to be a point on which you could help us out 
a great deal.
    Mr. Donohue. Senator, if I just might mention, on September 
the 19th, the Chamber's foundation, which you may recall has 
recently run seminars and symposiums on the energy crisis and 
issues of airline problems and so on, is having a major 
activity, a major event on this subject, and we are hopeful 
that we--and we are sure we will have participation by labor 
and the Congress and the White House and interest groups and so 
on. We are just wrapping some of that up, and I think it 
continues the debate, and we will take it around the country. I 
would love to travel with John to talk about these issues. 
Anywhere, you know, I will be there.
    Senator Brownback. Good.
    Mr. Sweeney. Senator, we have done a number of town hall 
meetings around the country, and maybe at the next one we will 
have Tom Donohue with us. But we have gotten as many as 20,000 
people in Los Angeles at one town hall meeting and have had 
similar events in different parts of the country, and we are 
doing everything we can to educate people on the issue and to 
get their views in terms of what changes they think should take 
place.
    Senator Brownback. Good, good. Raul, I hope you will join 
in with the discussion and traveling road show as well.
    Mr. Yzaguirre. I would be delighted.
    Senator Brownback. Very good. You can score these votes, 
too, John, and I can raise my labor score, my voting card. That 
would be helpful, too.
    [Laughter.]
    Mr. Donohue. Good luck.
    Senator Brownback. I am trying, I am trying.
    Mr. Donohue. You have got time.
    Senator Brownback. Mr. Sweeney, you had noted that you 
think that we should--in your specific suggestions, the 
employer sanctions and the I-9 system should be replaced with a 
system that targets--I am just reading from your testimony--
``and criminalizes business behavior that exploits workers for 
commercial gain...'' I am interested in that point because it 
seems to me that a number of employers do attempt to hire 
people legally. They look at the documents to the degree that 
they can. I have seen a number of these false documents that 
are very good, and that this criminalization system that we 
currently have is really trying to penalize at the wrong point.
    Do I take it from your statement here you agree with that 
and think that that system of employer sanctions should be 
dramatically changed?
    Mr. Sweeney. Yes.
    Senator Brownback. Do you have then specifics of where you 
think we should be targeting to try to get at those areas that 
do exploit workers for commercial gain?
    Mr. Sweeney. We would be glad to meet with your staff and 
share our experiences and what recommendations we might have or 
considerations for you.
    Senator Brownback. Good, because I think that is an 
important area to deal with. Right now I don't think the system 
is working at all in that regard.
    I don't know, Mr. Donohue, if you have anything from your 
experience.
    Mr. Donohue. I don't think the system is working. The place 
where John Sweeney is absolutely correct is that if you took 
and had people that were no longer illegal but they were on 
some formal status and that, if we agree, they would all have 
the same protection of the law, then a lot of the existing law 
outside the immigration area, a lot of the existing law would 
immediately affect these workers because if they were not being 
appropriately treated, they would not be afraid to bring that 
to the attention of the authorities. Now, if you are 
undocumented, if you are illegal, as John says, you are not 
going to do that.
    I am not sure how much additional law we have to add. I 
think we have to put people under the existing protections, and 
I absolutely agree with John that the current system is 
counterproductive.
    Senator Brownback. Mr. Yzaguirre, what are your comments on 
this?
    Mr. Yzaguirre. Well, Mr. Chairman, we opposed employer 
sanctions in 1986. We predicted that they would be ineffective 
and that they would cause widespread discrimiNation among 
Latinos. We insisted on a provision in the Act that would 
mandate GAO to do a study. That study showed massive, even 
larger levels of discrimiNation than even we had anticipated.
    At that time we proposed what we call a pattern and 
practice approach, that is, look at who--because there is a 
high correlation between those people who hire undocumented 
workers for exploitation and the fact that they are abusing 
existing wage and hour and working condition laws. So a pattern 
and practice approach focusing on the Department of Labor Wage 
and House Division is, I think, a much more effective and much 
more appropriate way to deal with that problem.
    Senator Brownback. That is a very good suggestion. I look 
forward to working with each of you on that issue. I just might 
say broadly I look forward to working with each of your 
organizations as we craft this proposal to move on forward, 
both as we craft a specific bill and efforts to move this 
forward on what the President outlined, on what I think has 
broadly been discussed here today, and then also as we attempt 
to move it through the Senate and through the House, which this 
is going to take a lot of effort on a lot of people's part. So 
I am hopeful we can do that as a team and be at the end of the 
day quite successful with something that should stand the test 
of time instead of more recent changes that we have made that 
have been more reactionary and in my estimation have not worked 
well in the interest of this country or in the interest of the 
people that desire to come to this country.
    Thank you very much.
    Senator Specter. Mr. Yzaguirre, I think you made a very 
spirited and excellent response to the question about 
legalizing undocumented persons would be only ``rewarding 
criminals.'' I don't think in the question there was any 
suggestion that the questioner thought we would be rewarding 
criminals. And I think it really inappropriate to talk about 
immigrants who come to this country illegally as being 
criminals. They really aren't. But I must say, having done some 
work in the field, people who buy the heads of lettuce and eat 
in the restaurants would not be co-conspirators or accessories 
after the fact. I think we ought to eliminate all of that kind 
of concern and really try to figure out how to treat all the 
people fairly and respond to a very, very serious problem.
    Mr. Sweeney, I believe I understood you correctly to say 
that--you used the word ``guarantee'' that there are no U.S. 
workers available for these jobs, and that is what I hear in my 
travels around my State. How do you do that? How do you have 
that kind of a guarantee that there are no U.S. workers who are 
available for these jobs?
    Mr. Sweeney. Well, I think we have to do a lot better job 
at labor market tests and especially with the guest worker 
program. But I think that we can really have better reports and 
a better handle on what the situation is in different 
industries and different job classifications.
    Senator Specter. And when you talk about giving these 
workers protection, certainly they are exploited. There are 
very frequent reports of families being exploited, in unlivable 
conditions, in shanties, and transported in trucks and all 
sorts of difficulties. But when you have a group of people who 
are concerned about being apprehended or about being returned 
to Mexico, you don't have people who are in a position to make 
any complaint. So it is very hard to give them protection when 
they are not in a position to come up and defend themselves and 
identify the mistreatment or perhaps illegal treatment they are 
being subjected to.
    How do you work on that one?
    Mr. Sweeney. Well, we start off with permanent legalization 
status for these workers, giving them the same kind of rights 
as workers who have been born in the United States, and giving 
them the entitlement to all of the protection laws, as well as 
the benefit laws, the social network that is available to 
workers and, we add, also gives them the right to organize if 
that is their desire.
    Senator Specter. Mr. Donohue, your point about the 
necessity for workers is obviously correct. Mr. Sweeney, you 
wouldn't disagree that there is a worker shortage, at least in 
some places, would you?
    Mr. Sweeney. No, no, I don't disagree with that.
    Senator Specter. The question then arises as to whether we 
ought to have a different immigration policy as to other 
places. We had a terrible time getting H-1B expansion. I recall 
working on this Subcommittee a decade ago, taking the Chamber 
of Commerce's position to try to expand that line. And even 
when you are dealing with Ph.D.s and M.D.s, you have, on lines 
which are not available in the United States, grave, grave 
difficulties.
    I might recount a story which is pretty close to the point. 
I had a chance to--Senator Shelby and I met with Saddam Hussein 
in 1990 before the Gulf War, and Saddam Hussein was complaining 
to us about U.S. immigration policy. Interesting that he would 
have a concern about it. And his point was that all the Russian 
Jewish immigrants were being sent to Israel and why weren't 
they coming to the United States. And I knew that he knew that 
I was Jewish, but I wanted him to know that I knew that he knew 
that I knew.
    [Laughter.]
    Senator Specter. And I told him that is a very sore subject 
with me because my father was a Russian immigrant who came to 
the United States. But only 50,000 Russians are permitted to 
enter the United States a year, and it is not that all of the 
rest of them--we are not trying to send everybody to Israel, 
but there are limitations.
    And I have raised the question on our policy again and 
again, beyond the H-1B, where I think it is a pretty clear 
proposition, but how about broadening immigration from other 
places to meet the kind of needs that we are concerned about? 
How about it, Mr. Donohue?
    Mr. Donohue. Senator, there was a study done by the 
Employment Policy Foundation, and while I think it is supported 
by business, there is something in here that is not an arguable 
issue on policy. It is a set of numbers. And it points out, as 
somebody reported in the testimony, we have about 140 million 
people working in the United States today, and based on our 
calculations of need, we will need about 200 million by 2030, 
and based on who has been born, we will end up with--and this 
includes illegal immigrants in here. We will end up with about 
165 million.
    So, clearly, on an ongoing basis, we are going to have a 
gap of about 35 million people. And today we are talking about 
illegal immigrants that bump up against--let's say we would 
maybe agree on 10 million. So we are going to have--and those 
illegal immigrants are already counted in the numbers. So we 
are going to have adequate opportunity to expand immigration 
all about the world.
    Now, let me make it clear. On the H-1B visas, which you 
have been an extraordinary supporter of, those are a very small 
number of very, very high-skilled people. And we bring them for 
two reasons: one, we need them and, two, it is just as easy to 
send the work where they are. You know, you can put a lot of 
technical stuff on a satellite and send it to India every 
night. We wanted to keep a lot of that business and a lot of 
that skill here in the United States.
    But what John and I are primarily talking about here is the 
bottom part of the triangle, the core of the people that run 
the American economy, not the guy that is a Ph.D. that ends up 
at Cal Tech or ends up at, you know, Intel trying to figure 
out--we are talking about the people that do everything to make 
that possible. And I think you are right on the core here, and 
that is, what do we do going forward so that we are not sitting 
back here and our children are there and here saying, you know, 
we have got 35 million illegal immigrants here, because the 
bottom line is we are going to get the people we need. And this 
country, with all of its faults, is still the place where 
people walk, swim, fly, do whatever they can to get here for 
great opportunity.
    So I think you are on to the issue, and that is, what do we 
do about the core workers we need to move this society forward? 
What do we do about the unemployment? A lot of that is 
geographic. You have people in your State who don't plan to 
move to New Mexico or Arizona or Florida. These are serious 
challenges. But I think you are asking the right questions, and 
we look forward to working with you because this is one issue--
it is not a policy question of we are going to have this tax or 
that tax or this regulation or that regulation. It is all about 
whether there is going to be anybody to work here or not.
    Senator Specter. Mr. Sweeney, if we were to open up the 
portals for more immigrants, look at the some of the 
projections, how are your constituents and my constituents 
going to respond to that?
    Mr. Sweeney. Well, Senator, I think that people understand 
the abuses of our present immigration system, and I think that 
legalization, changing and providing for legalization status is 
going to be a major step in the right direction. I believe that 
these workers having the same protection and being treated the 
same as workers born in the United States is going to relieve a 
lot of the pressures and a lot of the problems.
    And I go back, just to follow up on your original question 
and Tom's statement, that we really have to have a process with 
the expertise that is required to determine what the labor 
market situation is in these industries and jobs and so on. We 
are kidding ourselves if we are providing for workers of 
certain skills to come to this country and then placing them in 
entry-level jobs, which is the current situation in many cases, 
especially in the high-tech industry.
    Senator Specter. Thank you very much.
    I want to express my regrets to Mr. Norquist and Mr. 
Deffenbaugh and Mr. Moore of the last panel. This has been a 
long hearing. We are at about 2 hours and 15 minutes, and I 
cannot stay. But I will be checking the transcript.
    Thank you.
    Senator Brownback. [Presiding.] Thank you very much. This 
is an excellent panel, and we look forward to working with each 
of you on a very important and very difficult subject.
    Mr. Donohue. Thank you.
    Mr. Sweeney. Thank you.
    Mr. Yzaguirre. Thank you, Senator.
    Senator Brownback. I would like to now welcome our third 
and final panel which consists of Grover Norquist, executive 
director of Americans for Tax Reform; Ralston Deffenbaugh, Jr., 
president of the Lutheran Immigration and Refugee Service; and 
Stephen Moore, a senior fellow at the Cato Institute. I think 
their testimonies reflect the views of all types of 
organizations that have a longstanding interest in our 
country's immigration policies, and we will look forward to 
their testimony.
    Senator Kennedy. I, too, want to join in the welcome. I was 
necessarily out for a moment, but I am very glad to have all of 
you here, an impressive morning, and continuing with the panel 
that we are about to hear from. I know of few public policy 
issues where we have been able to develop the range and kind of 
support where there was such diversity in such a short period 
of time. So it is very important that we pull this information 
together for the benefit of our Committee, the Senate, and for 
the American people. So we are grateful to all of you.
    Senator Brownback. Mr. Norquist, would you like to go ahead 
with your presentation?

  STATEMENT OF GROVER NORQUIST, PRESIDENT, AMERICANS FOR TAX 
                    REFORM, WASHINGTON, D.C.

    Mr. Norquist. Yes, certainly. I have submitted some written 
testimony. I would like to start off by pointing out that 
immigration is good for the country, it has been good for the 
country, it will continue to be good for the country. It is a 
truism that the country was built by and for and with 
immigrants, but some truisms become truisms because they are 
true. And I think it is important to keep reminding ourselves 
of this. It is not just folklore or myth or something we like 
to think. It is actually accurate.
    The United States is different from other countries. We are 
not a people--we are not all the same ethnic group. We didn't 
all speak the same language when we started. We don't all have 
the same religion. What we have in common is a dedication to 
individual liberty and to the Constitution, and I submitted as 
part of my testimony the oath you take to become an American. 
It doesn't ask you where you came from, what your religion is, 
what color you are. It asks you: Are you willing to support the 
Constitution? And then we want you to be a citizen.
    Second, immigration is not only good for the country, it is 
a sign of health of the country. When you look around the 
world, successful countries have people wanting to get into 
them. Unsuccessful countries have people leaving them. And I 
think that it is very important for us to keep an eye on this. 
Back in the 1950s and 1960s, a lot of very stupid people with 
Ph.D.s wrote a lot of silly things about the decline of the 
West and the Soviet Union used its economic faculties better 
than we did and socialism was going to beat us. And then in the 
1980s, a lot of very silly people with Ph.D.s wrote about how 
Japan was going to outpace us because we didn't need labor 
markets and we didn't need capital markets, we needed 12 smart 
guys at MITI determining how to run things.
    Well, you know, Galbraith was wrong about the Soviet Union, 
and the people who wrote about the decline were wrong about 
Japan. But you didn't need a Ph.D. If you had stood at the 
border, if you had stood at an airport and figured out which 
direction people were going, you would have understood which 
countries were forward-looking and winning and which countries 
were losing and failing.
    I am glad we have more immigrants. I am even glad we have 
debates over immigrants. This last weekend, I was talking to 
the lovely and talented Ann Coulter, who said she is not 
offended in New York by construction workers who whistle at 
her. She worries if someday they stop whistling at her. I worry 
about her country if we stop having a debate about immigration. 
It would mean we are not having immigration, and that ought to 
tell us that there was something very, very wrong.
    A couple of quick points. Should we go with Mexico first? 
And some people say, well, it is not fair to regularize Mexican 
immigration before other states. When we brought Canada into 
NAFTA, it wasn't an insult to Mexico. We just did Canada first. 
When we brought Mexico into our free trade agreement, it wasn't 
an insult to Chile. It wasn't some statement that we didn't 
like Brazil. We did it bilaterally. We did it step by step. I 
hope that we will have a free trade agreement with the entire 
hemisphere--heck, eventually with the world, and we can do the 
same thing in regularizing immigration, do Mexico first and go 
on state by state. There is nothing wrong with taking one step 
first and then others.
    Next thought. Some people say, well, this rewards illegal 
behavior if you regularize the people who crossed the border. A 
couple thoughts on that. One of them might be, if you have 
people who are here, who have been working, is to say to them, 
look, we are going to regularize you, we are going to give you 
a piece of paper so that you don't worry about a knock in the 
middle of the night from the INS, so your employer doesn't 
worry that, you know, the Government is going to burst into his 
or her business and start arresting people and, you know, do 
some watered-down version of Operation Keelhaul out of the 
United States and across the border, but that one can get your 
paper and go get in line for full citizenship and so on, as if 
you had just shown up in Mexico City and applied for 
citizenship, so you weren't jumping the queue but you spent 
your time waiting in line here, not deported from the United 
States or in fear of that.
    Third thought. Some people in the past have said, well, we 
are hostile to the idea of immigration because they will all go 
on welfare and it will be a drain on taxpayers. Actually, I had 
a debate with the former head of the National Review who gave a 
speech that we shouldn't have immigration, they will all go on 
welfare. He gave a big speech. And I said you have just given a 
great speech against the welfare state but not against 
immigration. He said, yes, but we can't reform welfare, so we 
are just going to have to shut off the immigration.
    Well, in point of fact, you did reform a great deal of 
welfare, and I think we have greatly reduced the fear on some 
taxpayers' part that more immigrants means more people on 
welfare. Certainly there is more to be done on welfare reform, 
but I think that took an argument off the table.
    Two other quick thoughts. One is, when we have more folks 
coming here from Mexico and the rest of the world, I think we 
need to treat them the way we treated citizens that came here 
before. I am very concerned about the re-emergence of snob 
zoning laws. I am originally from Massachusetts, and we had 
what were called snob zoning laws when people in the suburbs of 
Massachusetts didn't want the ethnics moving out into their 
neighborhoods. Recently, snob zoning laws have been painted 
green, and they are now called anti-sprawl laws, but it is the 
same reasoning, it is the same thing. It is now we just don't 
want all these Hispanics moving to our neighborhood because 
they will scare the trees. And I think we ought not to say to 
people, Glad to have you in the country, but we have got these 
little bantu stands called cities that you are allowed to live 
in, we wouldn't want you in rural or suburban America.
    Second, I think it is also important that we give these 
people real protection, the protection all Americans have, so 
that nobody has to pay off anyone or go through any hoops on 
this side to get a job. I have talked to Hispanics who are 
worried that labor union guys come to them and say, You want 
protection, you got to pay union dues. No one should feel they 
have to pay union dues to keep their job or stay in the 
country. We need to put an end to that, and protection against 
that kind of exploitation of both immigrant labor as well as 
domestic labor.
    And, lastly, while we are on it, I think it is important 
that we move forward on President Bush's commitment and the 
commitment of many of you in the Senate to get rid of the 
secret evidence laws which have been used to discriminate 
against Muslims and Arabs in this country. And I would support 
the efforts that were started with Senator Abraham and others 
in this body to get rid of those laws.
    Thank you.
    [The prepared statement of Mr. Norquist follows:]

  STATEMENT OF GROVER NORQUIST, PRESIDENT, AMERICANS FOR TAX REFORM, 
                            WASHINGTON, D.C.

    I thank you for your kind invitation to speak about an issue that 
should remind us all of what our country represents. Reexamining our 
approach to Mexican immigration is, of course, timely, but it is also 
an important opportunity for us to contemplate what makes the United 
States so special, and how pivotal our relationship with Mexico is for 
the long-term economic vitality of the entire Western Hemisphere.
                         A Nation of immigrants
    Almost all Americans can trace their roots to another country, or 
several countries. Most modern nations have sizable shares of residents 
who are either recent immigrants or descendents of immigrants. But the 
United States has historically been, and in my opinion should continue 
to be, the favored destiNation of those around the world who seek a 
better life for themselves and their families. Immigrants benefit from 
the chance to work hard and succeed, and the United States benefits 
from their contribution to our economy and society. Our increasingly 
multi-ethnic Nation has grown stronger as it has become more diverse, 
with all its people bound together by a shared belief in the 
Constitution and the freedom it guarantees.
    The United States is a marvelous place indeed, and it's only 
getting better.
    So one could hardly blame Mexicans for looking towards the north 
for opportunity. Although Mexico is quickly becoming a flourishing 
Nation (thanks in no small part to NAFTA), it is understandable why 
many are so willing to risk entering this country illegally: the grass 
is greener on our side of the border at the moment.
    But it is also imperative that we should allow them to come to the 
United States legally, and return to Mexico as frequently as necessary: 
doing so would have the ultimate effect of reducing the constant 
pressure now exerted on the other side of our southern border. This 
pressure is expensive to combat, and counterproductive to the existing 
positive relationship between the United States and Mexico. It would 
make far more sense for this pressure to simply be relieved.
    Many Mexicans want to work in the United States temporarily, with 
the ability to regularly return to Mexico on occasion. But getting into 
the United States illegally keeps them here indefinitely, because under 
current law the hazards of frequently exiting and reentering are too 
great.
    Our best course of action would be to maintain the strength and 
integrity of our border, but allow it to become more flexible. This can 
be achieved through expanding temporary worker programs, increasing 
cross-border mobility, and extending permanent legal residency--but not 
necessarily citizenship--to those who qualify.
    We would all be well served to remember that our neighbors in 
Mexico would be coming here to work, not to go on welfare. And although 
many of them would have no desire to become American citizens, it would 
be a credit to the American Way to offer them the option. Doubtlessly, 
we welcome them to join us in our shared pursuit of happiness.
    I am pleased to see that interest groups across the political 
spectrum (even the AFL-CIO) are becoming less hostile to immigration. 
As a nation, we are more welcoming than ever before, but we still have 
much progress to make. Giving Mexican workers a chance to live the 
American Dream, or simply earn a fleeting glimpse of it if they so 
choose, would be an enormous advance in and of itself, and is the right 
thing to do.

                PEOPLE ARE THE ULTIMATE NATURAL RESOURCE

    The United States is a vast place, and compared to a great many 
other countries, especially those in Europe, it has a very low overall 
population density. There is ample space to accommodate newcomers, and 
there is now, as ever, a pressing need to allow immigrants to help us 
realize our Nation's maximum potential. With many jobs begging to be 
filled, and many Mexicans willing to do them, it's in our national 
interest to establish a coherent framework whereby the needs of 
employers and their prospective employees can be satisfied, despite 
differences of nationality.
    Make no mistake: immigrants do not take jobs from citizens, they 
create jobs for all of us by doing the hard work that increases our 
Nation's productive capacities, which in turn fuels economic growth. A 
rising tide lifts all boats, including a multinational tide.
    I would be remiss were I not to address here the false issue of 
``urban sprawl''. Now called ``anti-sprawl legislation'', it used to be 
called ``snob zoning''. Its goal was the same then as it is now: to 
keep ``them'' out of ``our'' neighborhood. Overcoming this odd 
obsession that afflicts far too many policymakers is as important as 
legalizing the honest work of immigrants. After all, they need places 
to live, and as I already noted, there is plenty of physical space in 
this expansive country for them. Anti-sprawl laws and regulations not 
only cause unjustifiable hassles for citizens seeking to find suitable 
housing, they act as barriers to immigration by reducing the potential 
housing stock.

 WE SHOULD TREAT IMMIGRANTS WITH THE SAME DIGNITY AS WE TREAT CITIZENS

     Our policies concerning immigration should be consistent with our 
Nation's commitment to civil liberties. The United States was founded 
on a belief that all people have certain inalienable rights that no 
government has the authority to confer or the power to rescind. 
Aggressively rounding up ``suspicious'' immigrants and summarily 
sending them back without giving them a fair chance to demonstrate how 
they can make a valuable contribution to their host's commonwealth is 
evocative of totalitarianism. Granting them legal residency, even 
temporarily, is not just humane, it's American.
    During the latter stages and aftermath of World War II, through an 
plan widely known as ``Operation Keelhaul'', the United States allowed 
thousands upon thousands of brave people who succeeded in reaching 
Western Europe after fleeing Stalin's emerging Soviet Bloc to be 
forcibly repatriated at the Communists' insistence. While I am most 
certainly not comparing the Mexico of today to the Russia of old, the 
principle still applies: it's wrong to close the door to opportunity on 
those who have risked all to pass through it and send them back from 
whence they came.
    Are we to take an Operation Keelhaul approach to these Mexican 
immigrants? Or any other category of immigrants for that matter? Could 
our consciences permit us?

           HEMISPHERIC FREE TRADE: GETTING FROM HERE TO THERE

    Our Nation is about to embrace a path to prosperity that will reach 
from the Canadian Yukon to Cape Horn. By enacting a free trade zone 
throughout the Western Hemisphere, we will dramatically improve the 
lives of all who live within it. Taking a more sensible approach to 
freeing the movement of labor is a crucial component of making 
hemispheric free trade possible.
    Admittedly, labor mobility is not the sine qua non of hemispheric 
free trade: that honor belongs exclusively to Trade Promotion 
Authority. Empowering President Bush (and every president after him, 
for that matter) with Trade Promotion Authority will ultimately make 
labor mobility throughout the hemisphere less of a concern by 
eliminating the punitive taxes on imports that kill job creation in 
developing nations and close access to markets to our south.
    Nevertheless, without a few changes to our labor laws sooner rather 
than later, Americans won't enjoy the widespread benefits of 
hemispheric free trade as quickly as we would have otherwise. And 
there's nothing more expensive than the wasted time that causes 
opportunities to be lost.
    Although granting special status to Mexican immigrants may be 
touted by some to be a slight against immigrants from Central and South 
America, it's best to view this as a necessary first step towards those 
with whom we share an immediate physical border, much like our 
bilateral free trade pact with Canada was a necessary precursor for 
NAFTA. If we don't make the modest effort needed to lay a foundation 
now, future measures aimed at establishing a hemispheric free trade 
zone will be all the more difficult.
    And we will all suffer as a consequence, Americans and Mexicans 
alike.

                   EXHIBIT A: THE OATH OF CITIZENSHIP

    ``I hereby declare, on oath, that I absolutely and entirely 
renounce and abjure all allegiance and fidelity to any foreign prince, 
potentate, state, or sovereignty of whom or which I have heretofore 
been a subject or citizen; that I will support and defend the 
Constitution and laws of the United States of America against all 
enemies, foreign and domestic; that I will bear true faith and 
allegiance to the same; that I will bear arms on behalf of the United 
States when required by law; that I will perform noncombatant service 
in the Armed Forces of the United States when required by the law; that 
I will perform work of national importance under civilian direction 
when required by the law; and that I take this obligation freely 
without any mental reservation or purpose of evasion; so help me God.''

            EXHIBIT B: ``THE NEW COLOSSUS'' BY EMMA LAZARUS

                         Not like the brazen giant of Greek fame,
                         with conquering limbs astride from land to 
                        land;
                         Here at our sea-washed, sunset gates shall 
                        stand
                         A mighty woman with a torch, whose flame
                         Is the imprisoned lightning, and her name
                         Mother of Exiles. From her beacon-hand
                         Glows world-wide welcome; here mild eyes 
                        command.
                         The air-bridged harbor that twin cities frame.

                         ``Keep, ancient lands, your storied pomp!'' 
                        cries she
                         With silent lips. ``Give me your tired, your 
                        poor,
                         Your huddled masses yearning to breathe free,
                         The wretched refuse of your teeming shore.
                         Send these, the homeless, tempest-tossed to 
                        me.
                         I lift my lamp beside the golden door.''

           EXHIBIT C: YAKOV SMIRNOFF, RUSSIAN-BORN COMEDIAN:

    ``My first thought after I had sworn for American citizenship was 
`I hate these foreigners who come here and take our jobs!' ''

    Senator Kennedy. [Presiding.] Thank you very much.
    Mr. Deffenbaugh?

 STATEMENT OF RALSTON H. DEFFENBAUGH, JR., PRESIDENT, LUTHERAN 
      IMMIGRATION AND REFUGEE SERVICE, BALTIMORE, MARYLAND

    Mr. Deffenbaugh. Thank you very much, Senator Kennedy, 
Senator Brownback, and all the members of the Committee. I want 
to thank you for holding this hearing and for the opportunity 
to testify. Particularly, I want to give a word of thanks for 
the adoption of 245(i) last evening. That will help a lot of 
families and remove the separation and hardships which many 
have faced because of the lapse in 245(i).
    In the Gospel of Matthew, in the 25th chapter, it says that 
the nations will be judged by how we treat the least of these, 
and this is indeed an historic opportunity for us as we talk 
about migration between the U.S. and Mexico. And I hope that as 
this body and as our Nation makes the decisions about how we 
will deal with migration between our countries and, in fact, 
general migration in the United States, that we will keep in 
mind that touchstone of how does it affect the least of these 
and that we will focus on the human rights and the human 
dignity of the migrants themselves.
    It is clear that our current immigration policy with regard 
to economic migration is unacceptable and has to change. The 
results of this policy today have included hundreds of deaths 
annually along the U.S.-Mexican border and elsewhere, abuse of 
the undocumented here in the United States, the separation of 
families, and an inadequate match between the labor needs of 
our $10 trillion economy and the poor and excluded who seek an 
opportunity in it.
    As an alternative, we propose the substantial legalization 
of economic migration. Honest people who want to work shouldn't 
be made to violate the law. And, specifically, we call for an 
independent worker visa that would not tie a worker to any 
particular employer or economic sector, but would provide for 
equal protection under the law and allow those with substantial 
equities in this country to adjust their status here to that of 
permanent residency.
    We have an opportunity now--and it is just amazing to see 
the change in the political climate, of course, with the 
friendship between President Bush and President Fox and the 
changes in the Mexican political scene. But we have an 
opportunity to shape a policy which would more appropriately 
reflect the relationship of two friendly nations whose people 
and economies are increasingly interdependent and not treat our 
immigration as though we need to put up more and more walls and 
barriers to those who would come in friendship to our country.
    We also have an opportunity to remove a grave injustice in 
our own country which causes great hardship to so many: the 
existence of a permanent sub-group of people who live without 
recourse to effective legal protection in our country. And this 
opens the door to their massive abuse and exploitation and 
harms the common good in our country. We can't continue to have 
a large under-class of people who do not have legal status in 
our country.
    So I thank you for the opportunity to speak for the human 
rights and human dignity of migrants and their families.
    [The prepared statement of Mr. Deffenbaugh follows:]

     STATEMENT OF RALSTON H. DEFFENBAUGH, JR., PRESIDENT, LUTHERAN 
          IMMIGRATION AND REFUGEE SERVICE, BALTIMORE, MARYLAND

                        INTRODUCTION AND SUMMARY

    Lutheran Immigration and Refugee Service (LIRS) was founded in 1939 
to help resettle refugees fleeing Nazi Germany. Since then, LIRS has 
resettled more than 280,000 refugees from all over the world. It 
provides service and advocacy through its 41 Lutheran affiliate offices 
and sub offices, its Washington, D.C. office and its headquarters in 
Baltimore, Maryland. LIRS advocates for just, compassionate policies 
for all newcomers to the United States and administers a fund from 
Lutheran and Presbyterian churches that provides grants to independent 
grass roots service programs to serve particularly vulnerable 
newcomers. There is a strong tradition of Lutheran pastoral care and 
ministry for migrant farm workers, both legal and undocumented. LIRS 
has opposed employer sanctions since their inception and has spoken out 
against workplace raids to the present day.
    Our Nation's immigration policy with regard to economic migration 
is unacceptable and must change. The results of this policy include 
hundreds of deaths annually along the U.S.-Mexican border and 
elsewhere, abuse of the undocumented here in the U.S. and an inadequate 
match between the labor needs of our $10 trillion economy and the poor 
and excluded who seek opportunity in it. As an alternative, we propose 
the substantial legalization of economic migration. Specifically, we 
call for ``independent worker visas'' that do not tie workers to any 
particular employer or economic sector, provide for equal protection 
under the law and allow those with substantial equities in this country 
to adjust their status to that of permanent residence.

   THE DEADLY BORDER IS AT THE CENTER OF A HISTORY OF POLICY FAILURE

    INS border enforcement strategy has, in effect, diverted migration 
flows to the most inhospitable desert and mountain regions causing 
dramatic increases in deaths due to exposure to the elements.\1\ 
According to the GAO, ``although INS has realized its goal of shifting 
illegal alien traffic away from urban areas, [the primary discernable 
effect of the strategy,] this has been achieved at a cost to both 
illegal aliens and INS.'' \2\ The number of bodies found by the INS on 
the U.S. side of the border soared to 367 last year and that almost 
certainly undercounts the total number of deaths. As of August 21 the 
death toll in California's Imperial Valley topped last year's figure in 
that region with six weeks left to go, despite a decline in 
apprehensions.\3\ Enforcement strategy has also resulted in an increase 
in the use of smugglers (and in their fees) and in the incidence of 
violence in the border areas. It has spawned rancor between property 
owners and migrants, including vigilante-style intimidation. Those who 
survive the crossing end up living underground, without legal status, 
sometimes in debt-peonage to criminal smuggling syndicates. They are 
also prey to unscrupulous employers who would use threats of 
deportation in order to squelch their rights.
---------------------------------------------------------------------------
    \1\ Karl Eschbach, Jaqueline Hagan and Nestor Rodriguez, ``Causes 
and Trends in Migrant Deaths along the U.S.-Mexico Border,'' University 
of Houston, Center for Immigration Research, March 2001.
    \2\ General Accounting Office, ``INS' Southwest Border Strategy: 
Resource and Impact Issues Remain After Seven Years,'' August 2000, pp. 
2-3.
    \3\ Ben Fox, ``Deaths near border rise at record pace. Imperial 
Valley; Six more weeks of expected heat could increase the toll, 
authorities say,'' The Press Enterprise (Riverside, Ca.), August 21, 
2001.
---------------------------------------------------------------------------
    Mexican migration to and from the United States has been an 
essentially cyclical phenomenon for more than 150 years. Modern efforts 
to suppress this pattern originate from the termiNation of the 1942-64 
Bracero program.\4\ At the time, opponents assumed that ending the 
program would tighten the U.S. agricultural labor market, resulting in 
increased wages and improved working conditions. Farmers, on the other 
hand, believed that ending the program would result in crop loss, 
business failure and higher prices. Both sides were wrong. The actual 
result was the steady rise in undocumented economic migration.\5\ 
Between, 1965 and 1990, besides the 1.9 million Mexicans admitted as 
legal permanent residents, there were an estimated 36 million 
unauthorized entries from Mexico to the United States and 31 million 
returns the other way.\6\
---------------------------------------------------------------------------
    \4\ Pia M. Orrenius, ``Illegal Immigration and Enforcement Along 
the U.S.-Mexico Border: An Overview,'' Economic and Financial Review, 
First Quarter 2001, Federal Reserve Bank of Dallas, p. 4; Gordon H. 
Hanson, Kenneth F. Scheve, Matthew J. Slaughter and Antonio 
Spilimbergo, ``Immigration and the U.S. Economy: Labor Market Impacts, 
Illegal Entry, and Policy Choices,'' June 2001, pp. 10-11, 34.
    \5\ Demetrios G. Papademetriou and Monica L. Heppel, ``Balancing 
Acts: Toward a Fair Bargain on Seasonal Agricultural Workers,'' 
Carnegie Endowment for International Peace, 1999, fn. 18, p. 18 and fn. 
16, p. 17.
    \6\ Douglas S. Massey and A. Singer, ``New Estimates of 
Undocumented Mexican Migration and the Probability of Apprehension,'' 
Demography, 1995, Vol. 32, pp. 203-213.
---------------------------------------------------------------------------
    In 1986, the Immigration Reform and Control Act (IRCA) attempted to 
`freeze' the cyclical migration pattern, attempting to apply a static 
solution to a dynamic phenomenon. Amnesty was granted to those already 
here and employer sanctions were imposed to deter those who might seek 
to come in the future. Employer sanctions hurt migrants in that they 
cause increased use of subcontractors to absorb risk of liability and 
simple discrimiNation against those who merely appear foreign. In 
effect, our immigration policies extract a ``risk premium'' from 
migrants' wages that has been estimated to amount to an estimated 28% 
cut.\7\
---------------------------------------------------------------------------
    \7\ Douglas S. Massey, ``March of Folly: U.S. Immigration Policy 
After NAFTA,'' The American Prospect, no. 37, March-April, 1998. Massey 
also found that, prior to the advent of employer sanctions under the 
1986 IRCA law, the key determinants of migrant wage levels were 
education, experience in the U.S. and English proficiency. After IRCA, 
the key determinants were social contacts.
---------------------------------------------------------------------------
    Many present day economic migrants also seek U.S. employment only 
on a temporary basis and would prefer to return to their families in 
their own countries periodically but they dare not do so due to the 
high risks associated with repeated entry. In other words, our very 
immigration policy, in attempting to thwart the circular pattern, 
perversely compels undocumented migrants to remain in the United 
States, apart from their families and unemployed in off seasons. 
Tragically, increasing numbers of women and children are dying at the 
border as migrants respond by attempting to bring their entire families 
over in order to avoid indefinite separation.
    And yet, for all the lethality and hardship caused by our present 
enforcement strategy, it has shown little effect in reducing illegal 
immigration \8\ and less in shoring up wages of unskilled Americans.\9\ 
In the U.S. economy, the low-skilled immigration is absorbed by changes 
in the production output mix through shifts to less skill-intensive 
sectors and technological change in other sectors based on skill 
increases among natives, moving them out of the low-skill labor 
market.\10\ The downward pressure on low-skill wages that does exist is 
virtually exclusive to American high school dropouts and influenced by 
technological innovation more than immigration.\11\ While this is cause 
for concern, such concern would be more effectively directed toward 
substantial education reform and target other headwinds facing the 
least among us. Scapegoating immigrants, on the other hand, neither 
teaches functional illiterates to read, nor frees addicts from 
substance abuse, nor reforms criminal sentencing anomalies, nor 
addresses any significant obstacle to the upward mobility American 
underclass.\12\
---------------------------------------------------------------------------
    \8\ Gordon H. Hanson and Antonio Spilimbergo, ``Does Border 
Enforcement Protect U.S. Workers from Illegal Immigration?,'' NBER 
Working Paper No. W7054, March 1999.
    \9\ Gordon H. Hanson, Kenneth F. Scheve, Matthew J. Slaughter and 
Antonio Spilimbergo, ``Immigration and the U. S. Economy: Labor Market 
Impacts, Illegal Entry, and Policy Choices,'' June 2001, pp. 10-11.
    \10\ Gordon H. Hanson, Kenneth F. Scheve, Matthew J. Slaughter and 
Antonio Spilimbergo, ``Immigration and the U.S. Economy: Labor Market 
Impacts, Illegal Entry, and Policy Choices,'' June 2001, pp. 14, 17-18, 
21. In more rigid markets such as Europe, by contrast, such influxes 
are absorbed more by increases in unemployment. Id. at 15.
    \11\ Id. at p. 23.
    \12\ Although LIRS does not develop positions on policies 
addressing such domestic issues, Lutheran church bodies associated with 
it do. See e.g., the Evangelical Lutheran Church in America, http)://
www.elca.org/des/advocagy.hbul and the Lutheran Church--Missouri Synod, 
http://humancare.lcms.org
---------------------------------------------------------------------------
                        INDEPENDENT WORKER VISAS

    While we favor the option of permanent residence for those who have 
established substantial equities in this country, we recognize that 
temporary visas can alleviate much of the hardship occasioned by 
present policies. Many economic migrants have no need or desire to 
immigrate to this country and only seek work here on an occasional or 
seasonal basis.\13\ This is an interest that can and should be 
accommodated.
---------------------------------------------------------------------------
    \13\ Belinda Reyes, ``Dynamics of Immigration: Return Migration to 
Western Mexico,'' Public Policy Institute of California, 1997.
---------------------------------------------------------------------------
    The key shortcoming in typical guest worker programs such as the 
Bracero and H-2A programs is that they are employer-centered. The 
employer is the sponsor/petitioner and the worker is more or less bound 
to that employer. This is an anti-competitive restriction of workers' 
bargaining power and inhibits their assertion of legal rights with fear 
of immigration consequences. This also amounts to an inappropriate 
privatization of our immigration policy. Making the legality of a 
person's status in this country dependent upon her relationship with a 
particular employer virtually invites abuse.
    Economic migrants, documented and undocumented, are presently 
working in virtually every sector of our economy, from manufacturing to 
services, from construction to domestic work. Industry-wide rather than 
employer-specific restrictions, such as a requirement to work in 
agriculture, would not only still constrain workers' bargaining power 
but would also be an unrealistic response to the defects of current 
policy. Only 10% of Mexicans and Mexican-Americans in the United States 
work in agriculture, while 85% work in the service sector and many are 
now entering the commercial sector.\14\ A policy that ignores economic 
reality is bound to fail and perpetuate the same ills of the status 
quo. Sectoral restrictions would also hinder economic development in 
Mexico as they would limit the value of the human capital infusions 
that take place when migrants return.
---------------------------------------------------------------------------
    \14\ Council on Hemispheric Affairs, ``Startling Statistics about 
Mexican Immigration,'' August 16, 2001.
---------------------------------------------------------------------------
    Independent Worker Visas, on the other hand, would be migrant-
centered visas for which the workers themselves apply, with no 
restrictions as to which employer or in which industry the bearer can 
work. Labor standards should apply equally to all workers with no 
discrimiNation on the basis of nationality or immigration status. 
Furthermore, those who develop substantial equities in this country 
should be allowed to adjust their status to that of permanent 
residence. These principles of mobility across employers and sectors 
and equal treatment under the law have been articulated by dozens of 
humanitarian and faith-based organizations \15\ and we are gratified to 
see them endorsed by the Democratic leadership of the U.S. Congress as 
well.\16\ A recent study from UCLA has also recommended a renewable 
``New Worker Visa'' initially for citizens of Mexico, Canada, the 
Caribbean and Central America, based on historical levels of 
undocumented entry that would ensure full portability across jobs, 
allow multiple re-entry to restore circularity, provide a path to 
earned residency after five years and include participation in payroll 
tax-funded benefits, though not means-tested public assistance.\17\
---------------------------------------------------------------------------
    \15\ ``Religious Leaders Call for Change in Policies that Result in 
Border Deaths,'' a June 4, 2001, http://www.firs.org/DonateServe/
advocate/EconMig ReligLdrs.pdf; ``End the War on Economic Migrants!'' 
February 14, 2001, http://www.lirs.org/DonateServe/advocate.htm.
    \16\ Sen. Thomas A. Daschle and Rep. Richard A. Gephardt, Letter to 
Presidents George W. Bush and Vicente Fox, August 2, 2001, p. 3.
    \17\ Dr. Raul Hinojosa Ojeda et al., ``Comprehensive Migration 
Policy Reform in North America: The Key to Sustainable and Equitable 
Economic Integration,'' North American Integration and Development 
Center, August 29, 2001, pp. 28, 32.
---------------------------------------------------------------------------
    Also, we recognize no fundamental moral distinction between 
Mexicans dying on our southern border, Haitians drowning in the 
Windward Passage and Chinese suffocating in cargo containers. While 
there may be sound political reasons for beginning the reform of our 
economic migration policies in a bilateral arrangement with Mexico, we 
share the view of the Administration and the Democratic Congressional 
Leadership that we should do so with a view to expanding it to equally 
deserving people of other nationalities.\18\
---------------------------------------------------------------------------
    \18\ President George W. Bush, ``Remarks by the President and 
Virginia Gubernatorial Candidate Mark Early in Photo Opportunity,'' The 
White House, Office of the Press Secretary, July 26, 2001; Sen. Thomas 
A. Daschle and Rep. Richard A. Gephardt, Letter to Presidents George W. 
Bush and Vicente Fox, August 2, 2001, pp. 1-2.
---------------------------------------------------------------------------
                       MIGRATION AND DEVELOPMENT

    Migration to the United States has been one of the most effective 
anti-poverty programs in the history of the world. This is not without 
repercussions in the countries from which immigrants come. Unlike 
refugees, economic migrants frequently return to their countries of 
origin and bring much needed capital--both human and financial--and, 
while they are here, provide an important source of income 
diversification and economic risk insurance for their families 
abroad.\19\
---------------------------------------------------------------------------
    \19\ Douglas S. Massey, ``March of Folly: U.S. Immigration Policy 
After NAFTA,'' The American Prospect, no. 37, March-April, 1998. Massey 
summarizes empirical studies indicating that Mexican migration into the 
U.S. (and back to Mexico) is more closely correlated with variances in 
interest and inflation rates between the two countries than it is to 
wage levels or public benefits. Questioning the assumption that 
migrants make decisions to enter or return based on simple entry-cost/
income-benefit analyses, Massey also rebuts the corollary notion that 
increasing barriers at the border will significantly prevent economic 
migration.
---------------------------------------------------------------------------
    The level of migrant remittances is staggering. The estimated $7 
billion Mexican workers send to their families each year is more than 
300 times our government's level of Official Development Assistance to 
that country; Salvadoran remittances are nearly 7 times all Foreign 
Direct Investment there; in Haiti, remittances constitute 17% of the 
GDP.\20\ The cost of rich country restrictions on the economic 
migration of the poor, on the other hand, is equally staggering. In 
1992, the United Nations Development Programme estimated that rich 
country immigration controls against poor country labor cost the 
developing world $250 billion or 10% of their combined GNPs.\21\
---------------------------------------------------------------------------
    \20\ Inter-American Development Bank Multilateral Investment Fund, 
``Remittances to Latin America and the Caribbean: Comparative 
Statistics,'' May 2001, www.iadb.or.p/mif/eng/conferences/remit-en.htm.
    \21\ United Nations Development Programme, Human Development Report 
1992, pp. 66-67.
---------------------------------------------------------------------------
    Aside from the financial capital transfer, economic migrants also 
return to their home countries with broader political experience with 
alternative standards of governance and higher expectations. These can 
provide significant constructive impetus for much needed reform, 
democratization and development in poorer countries.
    While we do not oppose the admission of high-skilled workers, we 
emphasize freedom of movement for the poorest of migrants for a number 
of reasons. The humanitarian needs of the poor are especially 
compelling and, without legal alternatives, they are consequently more 
likely to take death-defying risks. Finally, the American economy is 
increasing in its capital and highskill intensiveness. In 1940, 77% of 
our labor force was without a high school diploma; in 1990, fully half 
had attended college.\22\ This results in a growing disparity between 
our economy's proportionate low-skill labor factor endowment with 
respect to that of the rest of the world, particularly the developing 
world. In other words, the economic pressure for the equalizing 
immigration of low-skill workers is caused not only by the ``push'' 
from the developing world but also by the ``pull'' of our own economy.
---------------------------------------------------------------------------
    \22\  Gordon H. Hanson, Kenneth F. Scheve, Matthew J. Slaughter and 
Antonio Spilimbergo, ``Immigration and the U.S. Economy: Labor Market 
Impacts, Illegal Entry, and Policy Choices,'' June 2001, p. 23 Table 
3.3.
---------------------------------------------------------------------------
      Bases in Lutheran Immigration Studies and Policy Statements
    With specific reference to Mexico and its border with the U.S., the 
Lutheran Message on Immigration (ELCA, 1998),\23\ states that
---------------------------------------------------------------------------
    \23\ The Message is grounded in the pan-Lutheran documents ``A 
Statement on Immigration Policies: Moral Issues and National Interest' 
'(Lutheran Council in the USA, 1969, Minutes Exhibit F) and 
``Immigration Policies: Moral Issues and National Interest'' (National 
Lutheran Council Annual Meeting, February 2-5, 1960, Minutes Exhibit 
B).

        We recognize the right of all countries to control their 
        borders and their duty to protect their citizens from the 
        illegal entry of drugs and criminals. But we have serious 
        doubts about the rightness and effectiveness of current policy 
        to erect imposing barriers between the United States and 
        Mexico. We support the search for alternatives to this policy 
        that would more appropriately reflect the relationship of two 
        friendly nations whose peoples and economies are increasingly 
---------------------------------------------------------------------------
        interdependent. [p. 9]

    Far from a call for ``open borders,'' the Message nonetheless 
boldly suggests a highly constrained view of the substantive scope of 
the appropriate use of force in keeping people apart: e.g., the 
interdiction of drugs and criminals, not the separation of friendly, 
economically interdependent peoples.
    Under ``Advocating for F?;ir and Generous Laws,'' the Message lists 
among objectives ``giv[ing] content to our understanding of fair and 
generous immigration laws:

        1. To admit to our permanent population a steady proportion of 
        newcomers:. . .
        b. by facilitating the entry of persons possessing special 
        skills or other capacities needed by the American economy and 
        culture; `` [pp. 6-7].

    Finally, the Message recognizes that ``The existence of a permanent 
sub-group of people who live without recourse to effective legal 
protection opens the door for their massive abuse and exploitation and 
harms the common good'' and goes on to ``urge leaders and citizens to 
seek feasible responses to this situation that offer flexible and 
humane ways for undocumented persons who have been in this country for 
a specified amount of time to be able to adjust their legal status'' 
(p. 8).
    In Who is My Neighbor: A Statement of Concern (LIRS, 1994), we 
acknowledge that ``persons may feel their jobs threatened by newcomers 
into their communities'' ('II.3) but also recognize that ``To place one 
person or one need over another builds once more the walls which Christ 
came to remove'' ('II.1). We affirm that those ``fleeing desperate 
situations in which grinding poverty threatens the life and health of 
their families,'' no less than those fleeing persecution, are our 
``brothers and sisters.'' We must weigh ``the needs of the very poor 
who leave their homes to seek a better life in this country and the 
needs of this Nation to provide for the welfare of its citizens . . . . 
We can help to fashion a national immigration and refugee policy that 
justly and compassionately weighs the rights and the legitimate needs 
of both those who reside within our borders and those who seek to 
enter'' ('1I.4).
    Our Study Document of Principles on the Issue of Undocumented 
Aliens (LIRS, 1979), among ``Recommended Current Criteria and 
Principles,'' states that

        it is imperative that . . . people in underdeveloped countries 
        are dealt with justly and are able to pursue an adequate and 
        satisfying way of life. Yet until such development is achieved, 
        there must be a broadening of definition and understanding of 
        those eligible for proper admission into the USA. Stewardship 
        compels acceptance of as many as possible of those who have 
        endured economic suffering. Acceptance should not be limited to 
        the victims ofpolitical persecution. Whatever this richly 
        endowed Nation can do it must do.
        5. The advances that have been made in the field of civil 
        rights demand that no restrictions be placed on the employment 
        of the undocumented Employer sanctions for hiring the 
        undocumented could be an invitation under `color of law' for an 
        employer to reject the applicant who is not an English-speaking 
        Caucasian. Furthermore such sanctions would place the employer 
        in an enforcement role which is inimical to good order.
    A viable option [preferable to national identification] might be . 
. . enforcement of the labor practice laws already enacted, since one 
of the charges against the undocumented is that they lower present 
labor standards. This neither helps the U.S. worker nor the 
undocumented. [p. 4, emphasis added].
    Freed in Christ: Race, Ethnicity, and Culture (ELCA 1993) states 
prophetically that we ``look forward to the time when people will come 
from east and west, north and south to eat in the reign of God (Luke 
13:29)'' p. 2. In that light, it sets forth a bold advocacy agenda for 
equality that can inform the way we look at immigration:

        This church will support legislation, ordinances, and 
        resolutions that guarantee to all persons equally: civil 
        rights, including full protection of the law and redress under 
        the law of discriminatory practices; . . . opportunity for 
        employment with fair compensation, and possibilities for job 
        training and education, apprenticeship, promotion, and union 
        membership; . . . We of the Evangelical Lutheran Church in 
        America will advocate for just immigration policies, including 
        fairness in visa regulations . . . [p. 7, emphasis added]

                               CONCLUSION

    I thank Chairman Leahy, Senator Kennedy and the Senate Judiciary 
Committee for the opportunity to present this written testimony. I 
trust that you will bear it in mind in your quest for a just and 
equitable solution to the problems our present immigration system poses 
for economic migrants. We share President Fox's hope that an agreement 
can be reached before the end of the year, even as nearly a hundred 
more may die between now and then. We share Congressman Sensenbrenner's 
hope that INS can be substantially restructured but do not feel that 
reform of our economic migration policy can wait until then. 
Independent worker visas could be implemented largely through the 
Consular Affairs office of the State Department without adding any 
substantial burdens to the INS.

    Senator Kennedy. Thank you very much.
    Mr. Moore?

  STATEMENT OF STEPHEN MOORE, SENIOR FELLOW, CATO INSTITUTE, 
                        WASHINGTON, D.C.

    Mr. Moore. Thank you, Senator Brownback and Senator 
Kennedy, for the privilege of testifies on this very important 
issue.
    Let me start by telling you how much I appreciate what you 
have done over the last 30 years on this issue, Senator 
Kennedy. I am sure that there are many issues that you and I 
would disagree on, but I think on this one I really applaud 
your leadership on this issue. It has meant a lot to the 
American economy and to millions of people around the world who 
come here and become Americans.
    I would like to, if I could, just highlight three quick 
points because I know it is getting late in the afternoon.
    First, immigration is not out of control. We hear it said 
that we are under siege by immigration and that we are 
accepting record levels of immigrants that we cannot absorb. 
And if you look at my testimony, if you look at some of the 
graphics I have put together, what you find is that in absolute 
numbers, sure, we are pretty near a peak point, about 1 million 
entrants per year; but this is about equivalent to the number 
of immigrants who came in during the great Ellis Island wave of 
immigration at the beginning of the century. But, of course, we 
are much more populous country today than we were 100 years 
ago. And if you look at immigration relative to our population, 
we are actually at a fairly low level of immigration, at least 
historically. About four new immigrants come into the country 
for every thousand Americans that are already here. I think 
that is a number that we are well able to absorb, and we have 
been absorbing them well.
    A related issue with respect to this particular hearing is 
what about Mexican immigration. Has that been increasing or 
decreasing? And in preparation for this testimony, I looked at 
the historical data on where we are with Mexican immigration. 
What I found, Senators, is that over the last two decades we 
have seen an increase in immigration from Mexico, but not a 
startlingly large increase in Mexican immigration. And, in 
fact, I compared, Senator Kennedy, the percentage of immigrants 
coming from North America pre- the Kennedy Act of 1965 versus 
post-1965 Act, and what I found is there is almost no real 
shift in terms of the number of immigrants who are coming from 
our neighbor to the North and to the South. The actual big 
shift, as you know, has been away from Europe and towards Asia.
    So my point is just that, you know, we are not being 
overwhelmed right now with Mexican immigration, and I think 
that the proposal that is put on the table of a legalization 
program and guest workers would be very consistent with our 
historical policy.
    The second point I would like to make to you--and I think 
this is something that there is just an increasing economic 
consensus on the issue that immigrants are good for our 
economy. You know, this is something, if we had been debating 
it 20 years ago, a lot of the people who were in the anti-
immigration camp, if we had told them we are going to let 15 
million new Americans into the country over the next 20 years, 
they would have predicted increased unemployment rates and all 
sorts of economic damage done to American workers. And if you 
look at the evidence over the last 20 years, when we have had a 
fairly generous immigration policy, my gosh, today even with 
the increase in the unemployment number that was reported 
today, we still have the lowest unemployment rate in the 
industrialized world, even though we take more immigrants into 
the United States than all of our industrialized competitors 
combined.
    So I think as my former mentor used to say, Julian Simon, 
immigrants don't just take jobs, they create jobs through the 
businesses they create and through the demand that they create 
when they buy goods and services here in the United States.
    The last 20 years has been a great period of prosperity, 
and it has been a period of a fairly high level of immigration. 
My only point is that I think this period really proves that 
prosperity and immigration can co-exist.
    By the way, one area in particular where I think immigrants 
have just made an incredible contribution has been in the kind 
of information age, high-tech area. Again, in preparing this 
testimony, I was looking at some of the evidence from what has 
happened in the high-tech area, and it is estimated, for 
example, that in Silicon Valley, one out of every four 
businesses started over the last 20 years in Silicon Valley in 
the high-tech area was either founded by an Indian or a Chinese 
immigrant, which is really incredible. But they constitute 
almost 25 percent of the new businesses, which, by the way, 
gets to the point that immigrants don't just take jobs, they 
create jobs.
    The final point I would like to make to you which is of 
most relevance to the legislation that you will be looking at 
later this year and next year is with respect to the temporary 
guest worker program. And I just wanted to make this point 
because I feel very strongly about this. Over the last 50 
years, we have tried all sorts of measures to reduce illegal 
immigration, and I just want to go on record right now that I 
am very pro-legal immigration, but I am also very anti-illegal 
immigration. I think we do need to take steps to try to reduce 
the number of people who come into the country illegally. We 
have tried all sorts of types of measures to do that, 
including, for example, back 10 or 15 years ago when we 
implemented the employer sanctions law, which I think was a 
grand failure. I would agree with Grover Norquist that we ought 
to repeal that law.
    But there is one program, interestingly enough, that as 
actually worked fairly well in reducing the number of illegal 
immigrants who come to the country, and I would, if I may, 
Senator Brownback, refer you--if you have a copy of my 
testimony--to Figure 6 which looks at the last 50 years with 
respect to undocumented apprehensions at the border. And then I 
compared that with the number of temporary workers that were 
permitted to come into the country in the 1950s and 1960s. And 
the point of this graph, Senator, is that you see very high 
levels of undocumented immigration in the late 1940s and early 
1950s, and then in about the mid-1950s, we implemented a legal 
guest worker program. And what happened is that the number of 
illegal immigrants just plummeted. In other words, when we 
allowed Mexican immigrants a legal way to come here, the number 
of illegal immigrants dramatically declined. And, in fact, you 
see that happening for about the 15 or so years that that legal 
temporary guest worker program was in existence. Then when we 
eliminated that program, that is when illegal immigration 
started to go way back up again.
    So I think the historical record shows that if we do have a 
kind of humane guest worker program--and the guest worker 
program that we had in the late 1950s and 1960s had a lot of 
problems associated with it. But it does show that if you allow 
these workers a legal way to come, we can reduce illegal 
immigration. And I do believe that these workers who--after 
all, the immigrants who are coming here are the ones who are 
literally putting the food on our table, and our agriculture 
work has been done for 100 years by these migrant workers. We 
ought to really give them the decency and dignity of a legal 
program. And so I would really applaud any effort in that 
direction.
    Thank you.
    [The prepared statement of Mr. Moore follows:]

STATEMENT OF STEPHEN MOORE, SENIOR FELLOW IN ECONOMICS, CATO INSTITUTE, 
                            WASHINGTON, D.C.

    Thank you Senator Kennedy and Senator Brownback for the privilege 
of beingasked to testify before your Committee on the impact of U.S. 
Mexico migration issues.
    In this testimony I wish to make three points to the Committee. 
First, I wish to refute the widely held myth that immigration from 
Mexico is out-of-control or out of line with historical levels of 
immigrants admitted from our Southern neighbor. The percentage of 
immigrants coming from Mexico and other Central American nations is 
very much in line with rates of immigration for much of this region of 
the world for the past 100 years.
    Second, the economic impact of immigration over the past two 
decades has been highly positive. An economic consensus has begun to 
emerge that U.S. workers and industry benefit from a generous 
immigration policy. In fact, many of our competitors from other 
industrial nations have begun to grudgingly concede that U.S. 
immigration policy has allowed the U.S. to attract many of the top 
minds and talents from around the world. Mexican President Vicente Fox 
was exactly right when he asked President Bush in their recent meeting: 
How can it possibly be that Mexican immigration has hurt the U.S., when 
your economy has performed so well over the past two decades? The 
answer is that on balance Mexican immigration has been a benefit not a 
burden to our economy. Even though Mexican immigrants tend to be less 
skilled and less educated than American workers and immigrants from 
other regions of the world, these migrant workers fill niches in our 
workforce that help our economy perform at a high level of efficiency.
    Finally, I wish to comment on the legislative proposal to allow 
temporary guest workers into the U.S. I believe this policy would be 
highly desirable both in terms of reducing the flow of illegal 
immigration and in helping our vital agricultural and service 
industries attract the workers they need to remain competitive.
    Point #1. Immigration Levels Are Not Out of Control, Nor Is 
Immigration from Mexico Especially High
    A popular myth about current U.S. immigration policy is that the 
number of immigrants admitted has reached unprecedented heights. Here 
are the basic historical facts. In the 20th century America experienced 
two great waves of immigration to these shores: the first occurred in 
the early 1900s when huge throngs of European exiles the tempest tossed 
from Germany, Ireland, Italy, Poland, Sweden, Russia, and elsewhere 
arrived by ship and entered through Ellis Island. The second great wave 
began roughly 25 years ago and continues to this day.
    Our current immigration levels range from the moderately high to 
the historically normal range depending on what measurement we use. 
Certainly in absolute numbers the U.S. has increased quotas 
substantially. We now add about 1 million new foreigners every year to 
the stock of Americans, which is about equal to the historical peak 
levels of the early 1900s. See Figure 1.
    On the other hand, Pat Buchanan and Forbes writer Peter Brimelow, 
author of Alien Nation, are dead wrong in lambasting this flow as a 
kind of out of control alien invasion. The most meaningful way to 
measure our capacity to absorb immigrants into our culture and our 
economy is to calculate the number of people admitted relative to the 
size of the population already here. We now admit almost 4 new 
immigrants per year for every 1,000 Americans, which is a higher rate 
than in the past 50 years, but still only about half the historical 
average. See Figure 2. About 10% of Americans today are foreign born, 
which is just below our historical average, but is up a lot from 6% in 
the early 1970s. See Figure 3.
    An issue of direct relevance to the recent negotiations between 
George W. Bush and Vicente Fox is whether immigration from Mexico has 
reached levels that are abnormally high. That is to say: How has the 
ethnic composition of the ``new immigrants,'' changed over time? The 
2000 Reform Party presidential candidate, Patrick Buchanan, has 
insisted that immigration is causing America to lose its ``white 
European culture'' and there are many Americans who agree with him. A 
prediction by Census Bureau demographers that whites may soon by a 
minority in Texas and California has received front page billing in 
many newspapers. The Census Bureau also predicts that Hispanics who now 
constitute 8% of the U.S. workforce, will constitute more than 20% by 
2050. This is not just a cultural issue. Some economists maintain that 
the Europeans of earlier periods brought to the U.S. had much higher 
skill levels than the Asian and Hispanics do today.
    It turns out that although Latino immigration has been on the rise 
in the past two decades, the current percentage of immigrants from 
Spanish-speaking nations like Mexico is only slightly higher than 
historical levels. See Figure 4. It is very true that since the 
enactment of the 1965 Immigration Act, the ethnic composition of 
immigration has changed markedly--but not in ways that most people 
suspect.
    It is commonly believed that the big shift in the ethnic 
composition of immigrants in the 1970s, 80s, and 90s was toward 
allowing entry of more Hispanics from Central America and fewer 
Europeans. That is wrong. In fact, since the 1920s immigration from the 
rest of North America has remained steady at between 35 and 50 percent 
of the total. Hispanics have been coming to the U.S. in large numbers 
for 70 years. A 1988 U.S. General Accounting Office report concluded 
that the number of immigrants from Mexico has been ``quite stable in 
this century.'' Over the past 10 years, there has been a rise in 
Mexican immigration flows, mostly because of legalization that occurred 
in the early 1990s.
    What is different today than in 1965 is that European immigration 
has been supplanted by Asian immigration. Figure 5 shows that whereas 
in 1965 almost half of all immigrants came from Europe and 10 percent 
from Asia, by 1990 those percentages had essentially reversed (Moore, 
1989, Heritage). I am not at all suggesting that there is a major 
problem with Asian immigration. To the contrary, Asian immigrants have 
from Cambodia, China, India, Japan, Pakistan, Taiwan, and Vietnam, for 
example--been some of the most economically successful groups to ever 
come to these shores.
    I am only suggesting to this Committee that if we were to allow 
more migrant workers to come from Mexico, this would not be a major 
shift from our historical immigration policies.
    Mexican migrants have been coming to the U.S. for almost a century 
to work in agriculture and service industries. The flow will almost 
certainly continue regardless of actions taken by Congress. The only 
real issue is whether we will continue to treat these workers as second 
class citizens, or whether we will start to confer upon the the full 
protections of our laws and legal system. I believe that we ought to 
treat the Mexican migrant workers with the dignity and decency that 
they deserve and have earned over many decades of contributing to our 
country and our prosperity.
    Point 2. The New Immigrants have been economically beneficial to 
the U.S. and will continue to play a critical role in coming decades.
    Here is a little thought experiment. Imagine for a moment that we 
were transplanted back in time twenty years ago and that this were 
1981, not 2001. And imagine further, that you all on this Committee, 
were told at the start of the 1980s that over the next two decades the 
United States would admit more immigrants some 15 million newcomers 
than during any other 20 year period in American history.
    Given these conditions, if immigrants harm the U.S. economy or hurt 
American workers, we should certainly see some evidence of it by now.
    But happily, the evidence is nowhere to be found. There has been no 
increased unemployment, no increase in the black-white wage 
differential, no decline in family incomes, and no rise in poverty. In 
fact, virtually every one of these economic statistics has run in 
exactly the opposite direction of what immigration skeptics like 
Professor George Borjas of Harvard, would have predicted. The U.S. had 
high levels of immigration in the 1980s and 1990s and we enjoyed great 
economic prosperity and wealth creation. Virtually all income groups 
recorded gains.
    Let's briefly examine each charge made by the restrictionists and 
see whether the facts fit the fears:
    ``Increased unemployment'' Traditionally the overriding concern of 
Americans has been that foreigners will wrestle away jobs from U.S. 
born workers. Clearly that didn' t happen in the 1980s or 90s. The U.S. 
unemployment rate is now between 4 and 5%. The U.S. economy has shown a 
remarkable ability to absorb new workers into the economy both natives 
and immigrants without causing job shortages. Between 1980 and 2000 the 
U.S. became a job creation machine, with some 35 million more Americans 
employed today than 20 years ago. Even more impressive is that even 
though the U.S. takes in nearly as many immigrants in a year as does 
all of Japan and Europe combined, it is the U.S. that now has the 
lowest unemployment rate in the industrialized world.
    ``Rising poverty rates'' Do immigrants push Americans in the lower 
income into categories into poverty? Poverty rates are indeed high 
(26%) for first generation immigrant families, but what is noteworthy 
is that poverty rates for families of U.S. born parents, have fallen 
from about 15% in the early 1980s to a little over 10% in 2000. 
Americans have clearly not been pushed into poverty because of 
competition from the large scale immigration of the 1980s and 1990s.
    ``Lower wages for American-born'' workers George Borjas has gained 
notoriety for the claim in his 1999 book Heaven's Door: Immgration 
Policy and the U.S. Economy, that immigrants contribute to the widening 
income gap between the rich and poor in America. But the story is not 
nearly as dire as Borjas would have us believe. Median family income in 
the U.S. rose over the period 1981-1998 from $39,000 to $45,800 or by 
roughly 16 percent after inflation, according to recent Census Bureau 
data. Even more devastating to the hypothesis that the poor are losing 
ground because of immigration, is that family incomes even rose for 
Americans in the bottom 20% over this period. And in fact, if 
immigrants themselves are excluded from the picture, so we are only 
assessing the impact of migrants on U.S. born workers, incomes at the 
bottom of the income scale have risen substantially since 1980. Wage 
suppression does not appear to have occurred in this period of high 
immigration.
    ``Adverse competition with black workers'' Borjas and others have 
charged that the primary victims of U.S. immigration policy are black 
Americans who often must compete with foreigners for the same pool of 
low-skilled jobs. But over the past 20 years of high levels of 
immigration, the income gap between blacks and whites has actually 
shrunk. Blacks earned 60 cents for every dollar earned by whites in 
1980 compared to 69 cents today. For women that racial disparity has 
narrowed from 89 cents in 1980 to 94 cents for every dollar earned by a 
white. Meanwhile, in 1999 the black and Hispanic unemployment rates 
fell to their lowest levels since the data was disaggregated by race in 
the early 1970s. In sum, the 1980s and 90s were about the two best 
decades ever for the economic advancement of black Americans. There is 
zero evidence that immigrants stood in the way of this march toward 
economic equality.
    ``Lower economic growth'' What about the biggest issue of all: do 
immigrants reduce the rate of growth of the U.S. economy? The Federal 
Reserve Board calculates that over the past 20 years the U.S. economy 
has experienced a $10 to $12 trillion increase in net wealth (even 
accounting for the continuing stock market skid). The GDP has grown by 
nearly 80 percent (after inflation), and the inflation rate has fallen 
to nearly zero. In fact, Alan Greenspan has noted on several occasions 
in congressional testimony, immigrant workers have played a very useful 
role in smothering inflation in the U.S. economy.
    Certainly the fact that we had high scale immigration And 
prosperity simultaneously in the 1980s and 90s in no Way proves that 
immigrants caused the good times. But what The last 20 years do 
demonstrate is that a welcoming immigration policy can coexist with 
rapid economic growth, falling unemployment, and improved living 
standards for workers black and white.
    Now, there are two possible explanations here for why the 
experience of the 80s and 90s has failed to confirm the anti-
immigration movements case. The first is the one that the 
restrictionists would like us to buy: that we had this spectacular 
burst of economic progress, job creation, and new wealth, in spite of 
immigration. Who knows, the U.S. economy might have sprinted forward 
even more briskly if we hadn't had the burden of all the newcomers from 
around the globe.
    The alternative explaNation seems entirely more plausible: that the 
immigration restrictionists have simply gotten the economic story of 
immigration all wrong.
    The truth is that the immigration skeptics have always held a 
contrarian view within the economics profession on this issue. A number 
of years ago I conducted a poll of the past presidents of the American 
Economic Association and past American Nobel prize winners in economics 
and found to my surprise almost unanimous support for the proposition 
that immigration has been a very important factor in explaining rapid 
growth in incomes and output in the U.S. over the 20th century. 
Economists still argue over the size of the benefit to native-born 
Americans of immigrants with, for example the National Academy of 
Sciences recently speculating that the overall economic effect is a 
modest $10 billion a year contribution but very few argue that the 
impact is negative and that we are on balance worse off economically 
because of the presence of immigrants.
    I have always maintained that immigrants add value to a modern 
economy in two ways. The first benefit derives from their age profile. 
Most immigrants come to the U.S. between the ages of 18-35. That is, 
they come at the start of their working years. This has two benefits: 
first, the human capital costs of education and child rearing are borne 
by the taxpayers of the sending country, not by U.S. taxpayers. 
Immigration really should be thought of as a reverse-form of foreign 
aid. I have calculated that the human capital foreign aid we import has 
a value to Americans of about $50 to $100 billion a year or roughly 3 
times what we give to other nations in cash foreign aid payments. 
Second, because immigrants come to the U.S. when they are young with no 
corresponding parents who are eligible for Social Security and 
Medicare, they constitute a massive one-generation net benefit to the 
finances of both these programs. If we were to curtail all immigration 
for the next 25 years it would blow about a $1.5 trillion larger hole 
in the Social Security deficit. It is true that the immigrants will 
collect Social Security when they retire; but by that time they will 
have children paying into the system to cover their parents retirement 
costs.
    Second, skilled-immigrants of late have had a profoundly positive 
impact on the high-tech and information age economy. A 1999 study by 
the Public Policy Institute of California found that almost one of 
every four technology firms in the state were founded by either a 
Chinese or Indian immigrant. The study also found that roughly one of 
every three scientist and engineer in Silicon Valley was an immigrant. 
Just one immigrant alone, Hungarian refugee Andy Grove, co-founder of 
Intel is probably personally responsible for the high-paying jobs of 
10,000 Americans. So much for the job displacement argument.
    Certainly, the United States from an economic standpoint would be 
best off if we moved more toward a skill-based immigration selection 
criteria and de-emphasized family connections as the main gateway to 
entry. And in permitting more Mexican immigrants to come to the U.S. on 
a permanent basis, we should be attentive to how this might change the 
average skill levels of immigrants. Mexicans, for example, tend to have 
several years of fewer schooling than do Europeans and many Asian 
migrants, and thus their earnings potential in the U.S. is far more 
limited.
    Point 3. Guest Worker Programs Can Help Reduce Illegal Immigration
    I would maintain that one of America's most crucial foreign policy 
and national security goals should be to help keep the Mexican economy 
on a path toward rising incomes and prosperity. If Mexico could sustain 
a rate of economic growth of 5% per year, which it is capable of with 
the right set of market-based economic and tax policy changes, within 
one generation the average income Mexican worker can rise to near the 
level of a middle income American worker today.
    If the Mexican economy were to plunge into a deep and sustained 
recession, the push-factor of immigration@ would impel millions of 
migrants to attempt to pour over the border into the United States. The 
commitment by Presidents Bush and Fox to integrate the U.S. and Mexican 
economies through free trade and more open immigration policies will 
help the U.S. economy somewhat and will help the Mexican economy 
hugely. NAFTA and immigration are economic safety valves for Mexico and 
they must not be turned off. These policies ensure that Mexican 
migration to the U.S. remains orderly, managable and legal, not chaotic 
and illegal.
    A top priority for the U.S. should be to find ways to discourage 
illegal immigration flows from Mexico and other nations. Over the past 
50 years the U.S. government has attempted many policies to try to 
deter illegal immigration. The employer sanctions law, put in place in 
1986 has been a grand failure and should be repealed. It encourages 
employers to discriminate against foreign looking workers and it turns 
businesses into INS enforcement agents.
    One policy has worked extremely effectively and that is guest 
worker programs. The Figure shows that in the late 1950s and early 
1960s, when the U.S. allowed as amnay as 400,000 legal temporary 
workers to come to the U.S. and gain employment in U.S. agriculture, 
the number of illegal immigrants plummeted. See Figure 6. Although 
there were clearly problems with the guest worker program in the early 
1960s in terms of below standard working conditions for the Mexicans, 
from the point of view of reducing illegal immigration the policy was a 
grand success. Migrant workers will come to the U.S. through lawful 
channels if they are given the opportunity. I urge this Congress to 
consider implementation of a guest worker program for U.S. agriculture 
to help with the severe labor shortage for American farmers and to 
dramatically curtail illegal immigration.
    In sum, I believe a temporary guest worker program combined with a 
limited, earned legalization program for those in the U.S. for at least 
10 years should be considered. Ten percent of the guest workers= wages 
should be held in an escrow account that would be returned to the 
workers when they leave to go back to their home country. Social 
Security payroll taxes should be collected from these workers and paid 
in benefits at retirement age to these workers conditional on their not 
violating U.S. immigration laws during their lifetime. Criminal 
penalties should be imposed on smugglers who sneak illegal immigrants 
into the U.S. Cash fines should be imposed on illegal immigrants and 
illegal entrants should forfeit their opportunity to participate in 
guest worker programs or other legal immigration channels. In other 
words, the U.S. should say yes to legal immigration and a resounding no 
to illegal immigration. I believe a guest worker program could be the 
lynchpin of an effective border enforcement strategy.
    Thank you again, Mr. Chairman for the opportunity to share my 
thoughts on these critical economic issues.

    Senator Kennedy. Thank you very much. The headstrong 
opposition to the employer sanctions in the 1986 Act actually 
only ended up, I think, with 26 or 28 votes in opposition to 
the inclusion of the sanctions themselves at that time. I was 
not convinced that it was going to be effective or going to 
work, and it certainly hasn't. And we are committed to try to 
make adjustments on that as well.
    Mr. Norquist, let me ask you from a conservative's 
perspective, why does legalization--or your position on 
immigration, how does that sort of fit? Maybe I don't 
understand the conservative position historically well enough. 
But how do you see--how is this sort of consistent? Do you 
think it is just a matter of common sense? Or how do you come 
to this?
    Mr. Norquist. Well, like all conservative positions, it is 
simply a matter of common sense.
    [Laughter.]
    Mr. Norquist. But I would argue from an intellectual, 
ideological viewpoint, there is a great concern about a 
government that is too intrusive, that violates people's 
property, that knows too much about people, that does too much 
to and through them, and a government that knows where 
everybody is at all given times and knows all sorts of 
information about them is a dangerous government. I think 
privacy questions--the level of intrusiveness. I don't want the 
Government standing between everybody in this country and their 
employer and telling them what they can or cannot do. 
Capitalist acts between consenting adults should not be the 
purview of Washington or Mexico City.
    So I think it is also the idea that the Government was 
going to police the border when we have jobs here and people 
want to come and fit them and we have a failed Government 
program, which is letting too few people into the country 
legally, either as guest workers or on a citizenship track, or 
both. And when the Government made that wrong mistake, it then 
decided it was going to band-aid it by, you know, stopping 
people from crossing the border.
    The Government doesn't do that very well. It doesn't do 
many things very well, but it also doesn't do that very well.
    Senator Kennedy. Mr. Deffenbaugh, I appreciate your 
mentioning the establishment of the under-class. You know, this 
is the first time we have heard about it over the course of our 
morning. It is, of course, an important factor and a major 
concern concern in a democracy. If you have people that are 
being subject to exploitation, they may be willing to be 
exploited and suffer because they are more often than not 
interested in their children's well-being and their children's 
future, so they are willing to tolerate a good deal of 
hardship. But if the children see that their parents are being 
exploited, it begins to breed a kind of anti-authoritarian of a 
concept, and added to a lot of the other kinds of complexity in 
a society, I think it also can develop into social dynamite.
    I was interested in why faith-based organizations support 
immigration reform.
    Mr. Deffenbaugh. Well, I think it is basically because of 
the hardships now that are visited upon so many people because 
of the current immigration policy. We have the fact of the 
deaths on the border, you know, desperate people who simply 
want to come work in our country, find themselves risking their 
lives to try to come in, as Mr. Norquist said, to engage in a 
consenting capitalist act. And we have the separation of 
families, which you mentioned so eloquently in the 
introduction, where our current immigration policy has 
prevented close family members from being with each other and 
has perpetuated those divisions. We also have then the simple 
concepts of human freedom and offering people the opportunity 
to benefit themselves and their families and to try to have a 
better life for themselves.
    That is all part of enhancing the human dignity, which, of 
course, is a concern for any religious organization.
    Senator Kennedy. I think finally, Mr. Moore, just as we 
move ahead in some of these areas with modest steps, we 
continue to see a slowing down in the economy. What is your 
sense as an economist of what the implication will be in terms 
of unemployment and pressure, downward pressure, particularly 
in terms of American jobs? How do you look at this as an 
economist as to the swings that we are facing either now or 
what you are able to estimate in terms of the future? How 
worried are you or how concerned should we be?
    Mr. Moore. Well, there is both a political and an economic 
aspect to this. The political aspect is that historically, when 
times have gotten tough, Americans have sort of tended to blame 
the immigrants, you know: If we didn't have these immigrants in 
here, we would have these jobs, and so on. So it might make 
your job a little more difficult politically to get this job 
done that needs to get done. The unemployment rate numbers came 
out today, another four-tenths of a percentage point increase. 
So that doesn't make your job any easier.
    However, if you look at the economic evidence--and I have 
done a number of econometric studies that have been published 
in academic journals--there really is almost no evidence, 
Senators, that immigrants cause unemployment increases. It is 
really actually quite fascinating. No matter how you look at 
the evidence, you just don't find much evidence that immigrants 
cause unemployment overall.
    Now, there is some evidence that in certain occupations 
immigrants may come in and displace American workers from 
various types of jobs. A good example of that is the 
Washington, D.C., taxicab market. Thirty years ago, if you got 
into a cab in this town, you probably would have had a black 
American driving that cab. Today, if you get into a taxicab, 
you almost certainly will have an immigrant who is driving you 
around town. So, to some extent, yes, the immigrants have 
displaced the native-born Americans from that occupation, but 
it is not as if unemployment rose. It just means that those 
American workers have moved into other types of occupations.
    So I believe that the evidence over the last 20 years 
especially shows that we can have a generous immigration policy 
and falling unemployment. After all, in the early 1980s, we had 
8 to 10 percent unemployment. After letting in 15 million 
additional immigrants--and there were also several million 
illegals who came in that period--we actually now have a very 
low unemployment rate. So there is no correlation between being 
generous with respect to immigration and increased 
unemployment.
    And, by the way, let me say it is also true with respect to 
wages as well, that if you look over the last 20 years, median 
family incomes in this country have increased by 15 percent 
after inflation, again, over a period of high immigration. And 
even, for example, black, African American incomes have risen 
even faster than white incomes over the last 15 years. So there 
is no evidence that I see of direct harm to native workers from 
immigration.
    Senator Kennedy. Senator Brownback?
    Senator Brownback. Thank you, Senator Kennedy.
    Let me say thanks to all the panelists. I want to say 
particularly to Grover Norquist and Stephen Moore, as 
conservative voices, I appreciate greatly you being out there 
and discussing the issue of immigration and in a very positive 
sense because I think we are in for a real strong discussion, a 
long discussion about this topic, and we need to have a lot of 
strong voices out there.
    We had the last panel with both a head of labor unions and 
a head of businesses here saying we need to do the same sort of 
thing, coming from different reasons, different perspectives, 
but at the end coming to the same conclusion. And we need those 
strong voices out there, so I am very appreciative of you being 
out there and speaking, and I hope you will continue to, as I 
know both of you will.
    Mr. Moore, I want to hook into your last point that you 
made about the economic situation. We are in a softer economy 
now. Unemployment rates are going up slightly. The opinion you 
put forward and the economic analysis that you have done 
previously about there is no correlation between levels of 
immigration and unemployment or wage levels, that is the 
dominant view of most economists? I presume there are few that 
would disagree with that. But that is the dominant economic 
view? Would that be correct?
    Mr. Moore. I believe so. Look, you know, on every public 
policy issue that we deal with, there is always disagreement. 
But I think there is a growing consensus. As you know, Senator 
Brownback--was it a year or two ago?--the National Research 
Council did a major study on what is the economic impact of 
immigration, and they found that overall the impact was 
positive, that immigrants led to an increase in GDP and so on. 
And so I think there is an emerging consensus. You are still 
going to see people like George Borjas, for example, of 
Harvard, who disagrees with me on some of this--Briggs, Peter 
Brimelow. I call these guys ``the killer B's.'' But the fact of 
the matter is that I think the evidence has run very much 
contrary to some of their theories.
    Senator Brownback. That has been my sense of where the 
overall theory of the economy is going. One other thing I want 
to point out is something that you have done work on, the 
impact on our Social Security system, Medicare system of the 
immigrant workforce coming in, and that this is a key group 
helping us in solving a difficult demographic picture that we 
are faced with.
    Mr. Moore. We need the immigrants now more than ever 
demographically. There is no question about it. I mean, you all 
know about what is happening with the change in the demographic 
situation, and fewer workers entering the workforce and the 
emerging baby-boom generation.
    You know, what is happening all over the world is a kind of 
graying of the workforce of industrialized countries, and the 
one country that I think of all these countries that is able to 
solve this problem easiest is the United States because we have 
this kind of what I call a demographic safety valve of 
immigration.
    You know, it is curious, Senator Brownback, that when I 
talk to Europeans and people from Japan and so on, they are 
starting to grudgingly concede that maybe they need a more open 
immigration policy like the United States because they 
recognize what is happening in their countries with low birth 
rates. They realize that we are skimming the cream. We are 
getting some of the best and talented minds and talents from 
around the world, and they are not going to Germany and they 
are not going to Japan and they are not going to France. They 
are coming here.
    So I think this is a strategic economic advantage, and you 
are right, the extent to which we have an aging population 
allows us to benefit from the fact that most immigrants come to 
the United States between the ages of about 18 and 30, right at 
the prime of their working lives. This is a great bargain for 
Americans.
    By the way, can I mention just one other quick thing on 
this, Senator, in reference to your previous question about the 
economic consensus? About 10 years ago, I did a survey of the 
past presidents of the American Economic Association and the 
past Nobel Prize-winning economists in the United States. This 
was a sample of about 75 of the most prominent economists in 
the United States. Now, they represent all different fields of 
economics and so on. And I asked them in this survey--it was 
just a four-question survey. What do you think is the economic 
impact of immigration? And we found that it was almost 
universal that these highly distinguished economists agreed 
that immigration has played a very crucial role in America's 
economic development over the last century and that immigration 
will continue to be important.
    So I think it gets to your point that there is this kind of 
consensus among economists that this is good for our country.
    Senator Brownback. Mr. Norquist, what about the point about 
the immigrant force and its impact on our Social Security and 
Medicare system? I want to throw another twist to you on this. 
Some are saying that if we create a legalized type of system, 
we have a legalized worker system, they are going to pay into 
these systems. They are paying into them now. But if they go 
back to their home country, the Mexican Government is saying, 
well, there should be some way that they should be able to have 
access to some of the funds that they are paying in or some of 
the services that they have paid for in the structure of our 
system. I wonder if this doesn't bode for some sort of Social 
Security changes that we might look at down the road, 
particularly for this force.
    Mr. Norquist. Well, even with more immigrants coming in, 
you could theoretically, if you are willing to bring in 100 
million, keep the present Social Security Ponzi scheme going. 
But you really would need quite an increase in total 
immigration. But with higher immigration, it still doesn't bail 
out the present Social Security pay-as-you-go system. We need 
to shift to a system that is fully funded, individually held, 
where there is real savings going on, as other countries have 
done, as they have done in Galveston, Texas, as State workers, 
the 15 million State and local employees do. They have fully 
funded pensions. Those of us who don't work for State or local 
government don't have fully funded Social Security pensions. We 
need to move towards that, regardless of immigration.
    It is an interesting question of what do you do with people 
who have paid taxes. If the Mexican Government wants the money, 
I think the answer is no. If the individuals themselves are 
interested in it, you might want to cut some sort of deal and 
get them some defined contribution pension, especially if you 
are going to have guest workers who are just coming through and 
may wander back again. You don't have that problem if you had 
like a 401(k) for these immigrants or migrants, somebody who is 
coming in, put into a 401(k), just as you or I can take a 
401(k) or an individual retirement account and move to Alabama 
or France with it. It is still ours. But no one would move to 
France.
    [Laughter.]
    Senator Brownback. I won't touch that one in your comments. 
But I think it is going to be an interesting question that we 
are going to need to confront. These are people that will move 
back and forth and yet pay into that system. We need to 
structure it somehow to where it is beneficial and rightly 
fitted to them, and I think we need to look at some of these 
sorts of concepts where you do have definable plans.
    Mr. Deffenbaugh, finally, I would like to say thank you for 
all the generous help your organization has done for 
immigrants. Senator Kennedy and I were both talking up here 
about how much your organization helps on the firing line 
people on a daily basis in this country and around the world, 
and for that you are for this Nation fulfilling that admonition 
in Matthew 25 that I am deeply appreciative of, those quotes 
about true religion is taking care of widows, orphans, and the 
foreigner amongst you. And you help us in fulfilling that for 
this Nation, and I am very appreciative of that.
    You have also been supportive of the Refugee Protection Act 
that is a bill that is put forward, Senator Kennedy is pressing 
on, the chairman of the Committee is as well. I don't know if 
you have any additional thoughts on it, but we look forward to 
your help on that bill as well as on these overall immigration 
issues.
    Mr. Deffenbaugh. Yes, and we are really appreciative of the 
strong leadership that each of you have given on the Refugee 
Protection Act and on general issues relating to refugees and 
asylum seekers in this country. As you so well know, it is 
important that that Refugee Protection Act be passed so that we 
no longer have this terrible contradiction in our country now 
where the Nation with the Statute of Liberty in its harbor 
welcomes people fleeing from persecution by locking them up 
while we adjudicate their claims, if they are lucky; or if they 
are not lucky, they are turned away at the airport and don't 
even have a chance to press their claim. That is something that 
has to be changed.
    Then the other legislation which is pending now, which is 
also very important--and I say this from the perspective of an 
organization which has a long history of working with 
unaccompanied refugee children and with other unaccompanied 
children who are in INS custody--is the bill that Senator 
Feinstein introduced, the Unaccompanied Alien Child Protection 
Act, which would change this peculiar practice we have now in 
the United States of locking immigrant children behind bars 
instead of according to them the same child welfare protections 
that would be considered standard in a domestic setting.
    Senator Brownback. I appreciate your mentioning that. I 
might mention to the chairman, while I was chairing this 
Committee, Senator Feinstein raised this same issue, and I had 
promised her we would hold a hearing on that topic.
    Senator Kennedy. It is set for September 19th.
    Senator Brownback. Great. What efficiency.
    [Laughter.]
    Senator Brownback. Thank you all very much.
    Senator Kennedy. I want to thank you all. It has been an 
enormously interesting hearing. As I said, I have rarely seen a 
public policy question which brings about so much emotion and 
where there is really a coming together in terms of these 
common-sense recommendations and compassionate recommendations 
and recommendations that are clearly not just in the interest 
of the United States, but I think other countries and families 
as well. So we are really challenged. You have given us all the 
material now, and we are going to do the best that we can. But 
we will be calling on you for guidance, and we will invite you 
to, as you see this process develop, give us whatever 
suggestions or recommendations you have.
    We will include in the record at this point the statement 
of Chairman Leahy.
    [The prepared statement of Senator Leahy follows:]

 STATEMENT OF HON. PATRICK J. LEAHY, A U.S. SENATOR FROM THE STATE OF 
                                VERMONT

    This hearing occurs at a momentous time in our relationship with 
Mexico, and in our national attitude toward immigration. I applaud 
Senator Kennedy for chairing today's hearing, and for his longstanding 
dedication to the establishment of fair immigration policies. I hope 
that we come out of this hearing with both a clearer view of the Bush 
and Fox Administrations' goals for the ongoing bilateral discussions, 
and a strong consensus in the Senate that we will consult and work with 
the Mexican Government in our consideration of changes in U.S. 
immigration law and policy.
    It was a wonderful experience to take part in President Vicente 
Fox's address to a joint session of Congress yesterday. I am impressed 
by his energy and by his dedication to improving the lives of his 
people and the U.S.-Mexico relationship. I agree with him that the 
lives of both our nations' citizens would be enhanced by strengthened 
ties between our countries.
    When I think back to the immigration debates we had in this 
Congress five short years ago, during consideration of the Illegal 
Immigration Reform and Immigrant Responsibility Act, I am pleased and 
amazed at the change in rhetoric we see today. Five years ago in this 
chamber, immigrants received the blame for problems with our national 
security and economy. Today, the majority of us view immigrants as 
valuable additions to the American community and vital engines in the 
economic growth we have witnessed over the last decade.
    I do not want to prejudge the immigration proposals that the Bush 
and Fox Administrations will make. But it is fair to say that I, along 
with most Senators from both sides of the aisle, intend to be receptive 
and constructive toward the proposals that arise from the U.S.-Mexico 
discussions. I have said in the past that we should not offer 
immigration benefits only to residents of one nation, and I continue to 
believe that today. But given the importance of Mexican immigration I 
also believe that we should pay close attention to the thoughts of the 
Mexican government and the interests of Mexican nationals who are 
currently in the United States.

    Senator Kennedy. The Committee stands in recess.
    [Whereupon, at 12:50 p.m., the Committee was adjourned.]
    [Additional material is being retained in the Committee 
files.]

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