EB-5 program helps the nice parts of the U.S. get nicer

Since no evil billionaire has adopted my idea of building Latin American-style towns in the U.S. (see “non-profit ideas”), the nice places to live (Manhattan, San Francisco, Northwest D.C., etc.) keep getting nicer, more crowded, and more expensive. The crummy places (Detroit, Baltimore, etc.) keep getting crummier, less populated, and less expensive (free houses in some neighborhoods!).

The Wall Street Journal has an interesting article on a federal “EB-5” visa program for foreign nationals who loan $500,000 to a real estate developer building in a poor area or $1 million to a developer building in a rich area. It seems that state governments get to draw lines around “areas” and, with a bit of creative drafting, even parts of Manhattan where an apartment costs $4,000+/month can be officially “poor”:

The neighborhood immediately around Hudson Yards includes Manhattan’s tony West Chelsea. Unemployment in the local Census tract was just 4.9% in 2012—below the national rate—according to a letter sent in May 2013 from a New York state labor official to Empire State Development Corp., a state economic-development agency.

“The current minimum threshold to qualify as a Targeted Employment Area is 12.2%,” said the 2013 letter, obtained under the Freedom of Information Act. “For your consideration, we developed an alternative area.”

State labor officials added four additional Census tracts—three along the banks of the Hudson plus one that reaches into West Harlem. The unemployment rate of the combined five tracts, said the letter: 18.1%.

State governments—eager for economic development and with little stake in federal immigration policy—tend to side with developers who want their projects to qualify as easily as possible for financing.

I.e., we’ve voted to take a natural trend and pour Chinese rocket fuel on it.