Tax revenues are not keeping up with federal spending in the U.S.
In fiscal 2024, the federal government spent $6.75 trillion but only collected $4.9 trillion, resulting in a deficit of $1.83 trillion for the year. The Government Accountability Office warns the national deficit is “growing faster than the economy — this is unsustainable over the long term.”
Donald Trump and his pet program DOGE have been looking for ways to reduce the deficit. The president’s latest idea is a “gold card” visa program, which he claims would reduce deficit spending by generating additional revenue.
The gold card would act as a green card for the rich, providing pathway to U.S. citizenship at a cost of $5 million. As Trump explains, “Wealthy people will be coming into our country by buying this card, they’ll be wealthy and they’ll be successful, and they’ll be spending a lot of money and paying a lot of taxes and employing a lot of people.”
Commerce Secretary Howard Lutnick says the gold card program would replace the existing EB-5 Immigrant Investor Program that was created in 1990, which he claims is “full of nonsense, make-believe, and fraud.” To be eligible for an EB-5 visa, applicants must establish a “new commercial enterprise that will create full-time positions for at least 10 qualifying employees,” with a minimum investment of $1,050,000. Each year it accepts approximately 10,000 foreign investors, along with their spouses and any children.
Apparently, the government doesn’t have the resources needed to do effective background investigations on 10,000 EB-5 visa applicants annually. This problem, and its resultant fraud, could be eliminated by reducing the number of applications to a number that the government would be able to investigate effectively. Trump can make these reductions with his authority under Section 1182(f) of the Immigration and Nationality Act, which authorizes the president to “suspend the entry of all aliens or any class of aliens … detrimental to the interests of the United States.”
The EB-5 program doesn’t have to be terminated to make the gold card program feasible; they can both exist concurrently. These programs have different objectives: money produced by the EB-5 program is used to establish commercial enterprises, and money produced by the gold card program would be used to reduce the deficit.
More than 100 countries have programs that give immigration rights to investors. Nevertheless, these “programs are controversial because they can attract individuals seeking to use them for money laundering or fraud.” Thorough background investigations are needed to keep such individuals out of the program.
The up-front flat fee of the gold card program should make the fraud that has occurred in the EB-5 program less likely. The government will know whether the $5 million payment is genuine when the donor’s check is cashed.
Moreover, Trump intends to add a desirable incentive to encourage wealthy foreigners to participate in the program: gold-card holders will not have to pay taxes on their overseas income.
Does Trump have the authority to create the gold card? Migration Policy Institute spokesperson Michelle Mittelstadt tells U.S. News and World Report that although the administration has “significant leeway” for adjusting existing visa programs, it does not have authority to create new visas. That requires an act of Congress.
The CATO Institute’s director of immigration studies, David J. Bier, similarly says that visa categories are established legislatively. That means Trump can’t eliminate the EB-5 program and replace it with a new visa category of his own making. He will need the House and Senate to approve the plan.
I expect that the new Republican-led Congress will agree that the gold card program is a good idea and vote to authorize the new visa. If a substantial number of wealthy foreigners make a $5 million payment to the U.S., it would make a significant reduction in the deficit, which is likely to be appealing to lawmakers on both sides of the aisle.
It appeals to me for the same reason.
Nolan Rappaport was detailed to the House Judiciary Committee as an Executive Branch Immigration Law Expert for three years. He subsequently served as an immigration counsel for the Subcommittee on Immigration, Border Security and Claims for four years. Prior to working on the Judiciary Committee, he wrote decisions for the Board of Immigration Appeals for 20 years.
