Shelly Jarrett Bromberg: E-Verify neither simple nor free

State Rep. Courtney Combs’ latest bill, HR184, the “Ohio Job Integrity Preservation Act,” seems, at first glance, to be responding to the concerns of many who are calling for tougher sanctions to be levied on unscrupulous employers who are taking advantage of the current broken immigration system.

Yet, Section 8.02, making it mandatory that all business screen employees through a system, such as the Basic Pilot/E-Verify, will not significantly improve the overall picture for immigration, American jobs or the economy.

Currently, before any employer can access the system, they must be trained, pass an online test, demonstrate that their internal E-Verify system is secure, and take periodic refresher courses. The costs of implementing Basic Pilot/E-Verify are, understandably, much higher for small businesses — not only in terms of workplace hours, but in costly upgrades for computers, including a protected Internet connection.

Basic Pilot/E-Verify cannot be used to verify potential employees, only new hires. Even in Arizona, with one of the strictest mandatory E-Verify laws, the expense and possible backlog of verifying current employees led the legislature to specify that only new hires were to be screened. If a new hire does show up as ineligible, by law, the employer must continue to employ the worker until a final resolution of the case has been made. Employers who use the system to screen potential workers can be prosecuted under the Department of Homeland Security’s Memorandum of Agreement with the U.S. Immigration and Customs Service.

U.S. Chamber sues

Indeed, issues, such as possible racial profiling and the high costs for small businesses, were among some of the concerns that led the U.S. Chamber of Commerce to file a lawsuit earlier this year in federal court. The lawsuit seeks to prevent the Department of Homeland Security from implementing a nation-wide Basic Pilot/E-Verify for all federal contractors and subcontractors.

Along with the employers’ costs of implementing Basic Pilot/E-Verify, the federal government must also significantly increase its ability to check the Social Security numbers submitted by employers. The U.S. Customs and Immigration Service estimates that a mandatory E-Verify program would cost between $765 million and $863 million annually between 2009 and 2012, depending on whether just new employees or all those currently employed were to be screened.

In addition, the Social Security Administration, which would be responsible for checking 90 percent or more of the submissions against existing records, calculates that it would cost the agency an additional $281 million annually between 2009 and 2013. At a time when the Social Security fund is in danger of running out of benefits by 2037 (four years earlier than originally reported), this additional financial burden must be carefully weighed.

Other considerations

These obvious costs, for some, may be the price of reducing unauthorized immigration. Yet, there are additional considerations that challenge even the assumption that making E-Verify mandatory will significantly improve the job market for U.S. citizens, permanent residents and those with work visas.

Stephen Goss, chief actuary for the Social Security Administration, estimates that three quarters of all undocumented immigrants pay payroll taxes annually and each year, taxpayers who use incorrect or false Social Security numbers, contribute close to $7 billion to the SSA’s “Earnings Suspense File” and $1.5 billion to Medicare. Perhaps most tellingly of all, without a significant move toward a path to legalization for undocumented workers, the Congressional Budget Office has ascertained that making Basic Pilot/E-Verify mandatory will simply move much of the current undocumented work force from the formal to the informal economy, leading to a loss of $17 billion in payroll taxes in the next 10 years.

Problems in Arizona

Many proponents of mandatory Basic Pilot/E-Verify cite Arizona as the model for other states. Indeed, in Arizona, as in much of the United States, there has been a downturn in unauthorized immigration. Yet, it is too early to tell what effect, if any, the mandatory E-Verify law has had on that reduction. What is evident is that income-tax revenues for Arizona fell in 2008, at least one national restaurant chain declined to expand into the state due to potential problems with E-Verify, and the Arizona Chamber of Commerce believes there is a direct link between the growing labor shortage and the mandatory program. Perhaps most telling of all, Arizona legislators last year and again earlier this year tried to entice immigrant workers back by proposing a state version of the guest worker program.

Ohio, with an unemployment rate of 9.7 percent for March 2009, is home to approximately 1.1 percent of the nation’s unauthorized immigrant population, according to the Census Bureau’s “Current Population Survey” for 2008. Such low numbers can hardly be blamed for the state’s economic crisis. Nor is it the fault of undocumented immigrants that smaller cities throughout the state, such as Middletown (recently designated as the country’s 10th fastest dying city) is losing jobs, not to unauthorized workers, but to overseas competition in the form of lower wages and/or cheaper products.

Many of those involved in the immigration debate agree that there are serious problems with the system that need to be addressed and changed. So too, many agree that we will need a multifaceted approach that includes both enforcement and a path to legalization. Yet, enforcement without consideration for civil rights and individual liberties is undemocratic and counter to the values upon which our country is founded.

Given the current recession and the serious problems we have meeting even our most fundamental obligations to our state’s citizens, it would seem our time and energy might be better spent looking for ways to increase the economic health of the area, rather than create additional burdens on taxpayers and businesses through the continual introduction of short-term and, ultimately, overly complex bills.

Shelly Jarrett Bromberg is an assistant professor of American and Latin American Studies at Miami University in Oxford.