Business Record Daily PM 5.29.19

Report: U.S. visas should focus on economic development

The American Action Forum and the Concord Coalition today released a nonpartisan report that calls on the U.S. government to focus decisions on granting visas on the economic development ramifications, instead of mainly family considerations.

The national release held at Drake University at an event sponsored by the Greater Des Moines Partnership featured AAF President Douglas Holtz-Eakin and the group’s director of immigration and trade policy, Jacqueline Varas. Iowa GOP activist David Oman, who consults with Concord, and Joe Murphy, the Partnership’s lead staffer on government affairs, also made comments.

"We want to shift the flow of immigrants to emphasize people who have skills that are good for the economy," said Varas. Australia and Canada already do this, in large part.

Holtz-Eakin said the aging of baby boomers and the already low unemployment rate will spell trouble if the United States doesn’t act to change a visa system that has left the Partnership and others asking for changes for years.

"The U.S. will be Japan without changes in immigration," Holtz-Eakin said. "By making smart choices on immigration, we get to pick our future," he added.

The report makes three central points:

— The U.S. real gross domestic product per capita will rise by 1.1% per year on average over the next decade, down from an average of 2.1% in recent decades.

— Immigration helps push increases in total output and income, as well as in productivity, income per capita, and the standard of living.

— A new point system for granting visas could help by focusing on human capital, skills and entrepreneurship. As it is, just 15% of visas are granted based on economic considerations. The point system would look at English proficiency, education, age, employment experience, entrepreneurship potential, high-demand fields, local economic preferences, family relationships and whether the person graduated from the federal temporary work visa program, a six-year program.

"There’s a huge mismatch between employee demand [for workers] and the number of visas available," Varas said. One solution would be to grant visas to any worker who meets the minimum point total, instead of setting a limit on the number of visas, she added.

"Right now, they make it almost impossible to come here unless you are related to someone," Varas said.

Lori Chesser, an immigration lawyer with Davis Brown in Des Moines, said she opposes point systems because they send the process into the political arena. Holtz-Eakin said in response that, in his opinion, the shortage of workers in places like Des Moines won’t be solved without changes in immigration policy, which means the political ramifications must be addressed.

Murphy said he is hoping for broader action on immigration from Congress. "They have shown time and time again that they are sometimes unable to come up with common-sense solutions," he said.

Said Holtz-Eakin: "There is a hunger out there for actually fixing this."

NEWS BRIEFS

Red Rock reservoir releases rise to 2010 levels
The U.S. Army Corps of Engineers will temporarily increase water releases at Lake Red Rock to 50,000 cubic feet per second — the highest level since 2010. As of this afternoon, the lake was within 10 feet of its 1993 level. Saylorville Lake, 30 feet below 1993 levels, showed a drop in releases, and the Des Moines River south of the Saylorville Dam had fallen a foot in the past 24 hours. Updated information is available here.

DMACC Urban Campus begins renovation and expansion project
Des Moines Area Community College broke ground this morning for the first phase of a $24 million expansion and renovation of the DMACC Urban Campus in Des Moines. Muddy conditions kept the ceremony inside, however, and rather than using a backhoe as planned, DMACC President Rob Denson used a gallon bucket filled with garden soil and a trowel to symbolically break ground inside Building 1 on campus. The project is "an investment in each student who enrolls here," Denson said. "Right now, DMACC Urban Campus students don’t have enough space to study, meet, or just relax." The initial phase includes construction of a 60,000-square-foot DMACC Student Life and STEM Center Building, which is expected to be completed by the fall of 2020. Renovation of Building 1 will begin once the new building is completed. Officials say the DMACC Urban Campus is the most diverse college campus in Iowa, with 51% of its more than 5,000 students coming from diverse backgrounds, including more than 70 countries. The DMACC Foundation to date has raised approximately $2 million toward a $5 million goal in private donations for the project. Shive Hattery is the project architect for the Urban Campus renovation, and Rochon Corp. of Iowa is the general contractor. To read a Business Record story about the project, click here.

Western Iowa Energy to develop monarch habitat at Wall Lake plant
Western Iowa Energy has announced plans to establish a "monarch fueling station" at its biodiesel plant near Wall Lake. The habitat for monarch butterflies will span roughly 4 acres. The plant will start the process by spraying to eradicate nonnative grasses in June and in late fall. The company will then do a dormant seeding of native plants and milkweed in the field in early November. The Monarch Fueling Station Project was established by the Iowa Renewable Fuels Association in partnership with the Iowa Monarch Conservation Consortium in December 2017, to help Iowa’s ethanol and biodiesel plants establish patches of monarch habitat on plant grounds.

Local government officials are miffed at Iowa lawmakers over passage of a bill that adds steps to the budget-setting process and in some instances requires a supermajority of elected officials to approve proposed property tax rates.

Senate File 634 was passed in late April by the Iowa Senate and House. The original Senate version of the bill capped at 2% the increased amount of property tax revenue cities and counties could collect. Outrage over that plan prompted changes to the final version of the bill. Read more

MORE INSIDER CONTENT: See all Business Record Insider content and become an Insider.

NEWS BRIEFS

Democrats call on Iowa Legislature to reconvene and overturn medical marijuana veto
Iowa Public Radio: Democratic lawmakers are calling on the Republican-controlled Iowa Legislature to return to the Statehouse to overturn the governor’s veto of a bill that would have expanded the state’s medical marijuana program. Two-thirds of Iowa legislators would have to sign on to a letter to reconvene for a special session. The bill would then need a two-thirds vote to pass.

Weak sales report sends Abercrombie & Fitch stock down 24%
MarketWatch: Abercrombie & Fitch Inc.’s stock cratered 24% today, putting it on track for its biggest one-day percentage decline since November 2000, but the current pain will be worth the gains from the retailer’s store closure plan, according to GlobalData Retail. Abercrombie & Fitch reported weaker-than-expected first-quarter same-store sales and offered guidance that was below expectations. The retailer said it would close three additional flagship stores in New York City, Fukuoka, Japan and Milan.

Today’s extra briefs:
- Stocks drop as trade tensions heighten growth worry (Reuters)
- Ferrari accelerates its move into hybrid cars (Reuters)

ONE TORNADIC READ
Tornado activity map shows every NOAA report from 2019 so far

Fast Company: If you think you’ve been hearing more about tornadoes lately, you’re not imagining things. An unusually busy stretch of tornado activity has caused deaths and destruction in a number of states over the last month. The Storm Prediction Center from the National Oceanic and Atmospheric Administration’s National Weather Service has been keeping a tally on the activity. It shows 935 preliminary tornado reports for 2019 so far, compared with 1,169 for all of last year.

Is a Recession Around the Curve?
KENT KRAMER, FOSTER GROUP
CFP®, AIF®, Chief Investment Officer

What interest rate would you expect to receive on a:

12-month CD? 5-year CD?
If your answer was higher for the 5-year CD, you are expressing the normal expectation of a higher return for a longer term to maturity. The same intuition holds when homebuyers consider a 15-year mortgage vs. a 30-year mortgage. The higher interest rate is compensation for bearing more risk of interest rate and inflation changes, as well as the opportunity cost of not investing in other things over that same time period. > FULL ARTICLE

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