‘Ev­ery­one in China has the Amer­i­can Dream’

The ‘golden visa’ — a pop­u­lar path to life in the U.S. — may soon be out of reach for many

The Washington Post Sunday - - BUSINESS - BY TRACY JAN

bei­jing — Their son was barely a year old when Je­han Li and Mia Qi plunked down a half-mil­lion dol­lars for the boy to have a shot at a brighter fu­ture in Amer­ica — away from the grind­ing com­pe­ti­tion of a Chi­nese ed­u­ca­tion and this city’s smog-choked air.

Last De­cem­ber, hav­ing made just a sin­gle visit to the United States on their hon­ey­moon, the Chi­nese cou­ple took ad­van­tage of a U.S. law, nick­named the “golden visa,” that doles out green cards to for­eign­ers who in­vest $500,000 in the United States.

Crit­ics say the fast track to cit­i­zen­ship fa­vors the ul­tra-rich. It is also emerg­ing as one of the most at­tain­able paths to U.S. res­i­dency for mem­bers of China’s grow­ing pro­fes­sional class — and now it could dis­ap­pear.

The nearly three-decade-old pro­gram has come un­der new scru­tiny in re­cent months, in part be­cause of a sales pitch to Chi­nese in­vestors by White House

se­nior ad­viser Jared Kush­ner’s fam­ily real es­tate busi­ness.

Congress and the Trump ad­min­is­tra­tion are con­sid­er­ing chang­ing the rules for the in­vestor visas as a means of crack­ing down on money laun­der­ing and visa-for-sale fraud. Po­ten­tial changes, such as rais­ing the in­vest­ment thresh­old, would have lit­tle im­pact on China’s wealth­i­est. But they could shut out fam­i­lies such as Li and Qi, who de­spite rid­ing the curve of up­ward so­cioe­co­nomic mo­bil­ity in China still see the United States as their best op­por­tu­nity and this visa pro­gram as their best op­tion.

The de­bate over the in­vestor visas raises ba­sic ques­tions about the pur­pose of U.S. visa poli­cies. Some say this pro­gram should be elim­i­nated in fa­vor of other im­mi­grant groups, such as high­skilled work­ers or refugees es­cap­ing per­se­cu­tion — and not let peo­ple buy their way into the United States. Oth­ers say those with sub­stan­tial amounts of money are best po­si­tioned to boost the Amer­i­can economy, by in­vest­ing their wealth and cre­at­ing jobs.

“Are we look­ing for the peo­ple? Or are we look­ing for the money?” said Wil­liam Cook, for­mer gen­eral coun­sel of the U.S. Im­mi­gra­tion and Nat­u­ral­iza­tion Ser­vice un­der Pres­i­dent Ge­orge H.W. Bush when Congress cre­ated the EB-5 visa pro­gram.

“In the end, the sim­ple truth is the gov­ern­ment is look­ing for the money. And that may un­for­tu­nately ex­clude peo­ple who can no longer af­ford it, even if they may be the best peo­ple in the world.”

Dur­ing his lunch break at a Pizza Hut in one of Bei­jing’s ubiq­ui­tous shop­ping malls, Li, a 38-year-old civil en­gi­neer, ex­plained the draw of the EB-5 in­vestor visas for up­wardly mo­bile Chi­nese with­out vast in­her­ited for­tunes.

“There are a lot of ways to im­mi­grate to Amer­ica, but this EB-5 pro­gram is the eas­i­est,” said Li, who in­vested in a Mi­ami res­i­den­tial sky­scraper un­der con­struc­tion.

The only re­quire­ment is cash. Un­like other im­mi­gra­tion visas, one does not need to have rel­a­tives in the United States or have any ex­tra­or­di­nary abil­ity, ed­u­ca­tional de­gree or pro­fes­sional achieve­ment.

The EB-5 pro­gram be­came at­trac­tive to U.S. real es­tate de­vel­op­ers af­ter the 2008 fi­nan­cial cri­sis as a re­li­able source of cheap cap­i­tal when bank loans were dif­fi­cult to come by. The de­vel­op­ers pay low an­nual in­ter­est on in­vest­ments from EB-5 visa hold­ers, typ­i­cally just 4 to 8 per­cent com­pared with 12 to 18 per­cent for con­ven­tional fi­nanc­ing. Af­ter au­thor­i­ties con­firm that the money has cre­ated at least 10 Amer­i­can jobs, a visa holder will be el­i­gi­ble for per­ma­nent res­i­dency — and to re­coup his or her in­vest­ment.

“It is good to own some U.S. dol­lars as the U.S. economy re­cov­ers from the fi­nan­cial cri­sis,” Li said.

Far from be­ing scions of China’s rul­ing class, Li and his wife, a cus­tomer ser­vice rep­re­sen­ta­tive at a Bei­jing real es­tate com­pany, earn about $100,000 a year. That is well above av­er­age for Bei­jing but not in the ranks of the wealth­i­est elites.

They were able to scrounge up the $500,000 by sell­ing a fourbed­room house on the out­skirts of Bei­jing that Li’s par­ents had helped him buy a decade ago. (It is com­mon in China for par­ents to help their chil­dren, es­pe­cially sons, buy homes.)

The fam­ily of three rents a mod­est, two-bed­room high-rise apart­ment in a mid­dle-class com­pound in the south­west­ern part of China’s sprawl­ing cap­i­tal city. Although home­own­er­ship is prized among Chi­nese as a se­cure fi­nan­cial in­vest­ment, Li and Qi said they view rent­ing as a sac­ri­fice for the sake of their son, Os­car.

The cou­ple, who mar­ried in 2014, said they com­mit­ted to im­mi­grat­ing dur­ing their 10-day hon­ey­moon in Cal­i­for­nia, where they soaked up the grandeur of Yosemite Na­tional Park, vis­ited the Hol­ly­wood Walk of Fame, and even checked out the Univer­sity of Cal­i­for­nia at Los An­ge­les.

“We went to Amer­ica to va­ca­tion with the pur­pose of un­der­stand­ing the coun­try,” said Li, whose no­tions about the United States came only from movies tele­vi­sion news. “The val­ues of in­de­pen­dence, equal­ity, free­dom and democ­racy have at­tracted me deeply. I was al­ready hop­ing to raise our child there.”

Qi, also 38, said they knew then that they needed to find a way for their fu­ture child to study in Amer­ica.

“Ev­ery­one hopes their chil­dren can get the best ed­u­ca­tion, and the best ed­u­ca­tion is in the United States,” she said. “There are too many peo­ple in China, and the com­pe­ti­tion is fierce, so all they do is study, study, study.”

Chas­ing the Amer­i­can Dream

Of the 8,500 EB-5 visas is­sued in 2016, 82 per­cent went to in­vestors from main­land China, ac­cord­ing to the State De­part­ment. A decade ago, Chi­nese na­tion­als ac­counted for just 12 per­cent of such visas.

Chi­nese im­mi­gra­tion bro­kers up­per-mid­dle-class in­vestors have flocked to the pro­gram in re­cent years as their in­comes in­creased and their real es­tate ap­pre­ci­ated.

But that route to the United States may soon close for fam­i­lies such as Li and Qi.

Con­gres­sional au­tho­riza­tion for the EB-5 visa ex­pires in Septem­ber, and law­mak­ers, as well as the De­part­ment of Home­land Se­cu­rity, are weigh­ing new rules that could raise in­vest­ment re­quire­ments from $500,000 to as much as $1.35 mil­lion.

Sen. Dianne Fe­in­stein (D-Calif.), who as­sailed the in­vestor visa as “cit­i­zen­ship for sale” to the wealth­i­est bid­ders, has in­tro­duced a bill with Sen. Charles E. Grass­ley (R-Iowa) to scrap the pro­gram.

Leg­is­la­tors who have long ag­i­tated for change were fur­ther riled in May af­ter one of Kus­hand ner’s sis­ters pitched a New Jer­sey lux­ury apart­ment project man­aged by the fam­ily’s real es­tate com­pany to po­ten­tial Chi­nese in­vestors in Bei­jing.

Such sales pre­sen­ta­tions by U.S. de­vel­op­ers seek­ing to woo Chi­nese in­vestors are com­mon, im­mi­gra­tion bro­kers say. But the Kush­ner Com­pa­nies event drew crit­i­cism for at­tempt­ing to cash in on Kush­ner’s White House con­nec­tions. One speaker ad­vised those in at­ten­dance to in­vest early — un­der the “old rules” re­quir­ing $500,000 — in case reg­u­la­tions change un­der Pres­i­dent Trump, Kush­ner’s fa­ther-in-law.

Michael Short, a White House spokesman, told The Wash­ing­ton Post that the Trump ad­min­is­tra­tion is “eval­u­at­ing whole­sale change of the EB-5 pro­gram,” in­clud­ing “ex­plor­ing the pos­si­bil­ity of rais­ing the price of the visa.”

The un­cer­tainty has prompted a scram­ble among some Chi­nese in­vestors, said Jerry Liu, an im­mi­gra­tion con­sul­tant in Bei­jing.

“Right now, the mar­ket is re­ally hot, and more peo­ple can af­ford it be­cause of China’s grow­ing economy,” Liu said. “Ev­ery­one in China has the Amer­i­can Dream.”

Be­cause of a cap on the num­ber of visas by na­tion­al­ity, Chi­nese ap­pli­cants must wait seven to 10 years from the time they in­vest to when they se­cure green cards, Liu said. The pro­gram has a big back­log; un­til 2015, the wait time was five years.

That has prompted par­ents, wor­ried about their chil­dren turn­ing 21 and ag­ing out of the visa pro­gram be­fore their green cards are ap­proved, to start ap­say ply­ing years be­fore their chil­dren reach high school.

About a third of Chi­nese ap­pli­cants are even ap­ply­ing in their teenage chil­dren’s names, an­tic­i­pat­ing that their green cards would not be avail­able un­til they are adults and can move to the United States on their own, said Ron­nie Field­stone, a Mi­ami at­tor­ney rep­re­sent­ing de­vel­op­ers and Chi­nese im­mi­gra­tion agents in­volved in EB-5 projects.

Li and Qi are re­lieved to have got­ten in line be­fore the United States changes the in­vest­ment rules.

The Mi­ami de­vel­op­ment they in­vested in is slated to be fin­ished in early 2019, ac­cord­ing to Para­mount Mi­ami World­cen­ter, the de­vel­oper. Con­struc­tion is com­plete for 12 of its 60 sto­ries. More than 60 per­cent of the lux­ury con­do­minium’s 500 units have sold.

Once the U.S. gov­ern­ment ap­proves the fam­ily’s pe­ti­tion, they will re­ceive two-year con­di­tional green cards.

The cou­ple have al­ready re­searched hous­ing and schools in Los An­ge­les, where they hope to set­tle. And they are ex­pos­ing Os­car, 21 months old, to English through nurs­ery songs. He is learn­ing the al­pha­bet and likes to sing a count­ing song about catch­ing fish.

“We hope to be in Amer­ica,” Qi said, “by the time our son fin­ishes el­e­men­tary school.”

“We went to Amer­ica to va­ca­tion with the pur­pose of un­der­stand­ing the coun­try. The val­ues of in­de­pen­dence, equal­ity, free­dom and democ­racy have at­tracted me deeply.” Je­han Li, who with his wife, Mia Qi, wants to move to the United States with their 21-month-old son, Os­car


ABOVE: Je­han Li and Mia Qi watch their son, Os­car, play in the court­yard in front of their home in Bei­jing. LEFT: The cou­ple rent a mod­est, two-bed­room apart­ment since they sold a fourbed­room house on the out­skirts of the city to in­vest $500,000 in the United States as part of the EB-5 visa pro­gram.

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