“USIA’s management oversight of the J-visa program has not been adequate to ensure the integrity of the program … . USIA lacks adequate information on participant activities, does not enforce requirements that program sponsors provide periodic information on participant activities, has no systematic process to monitor sponsors’ and participants’ activities, and does not adequately coordinate the program internally or with other agencies having visa responsibilities.”4
“We are moving forward with a new rulemaking that will capture the 2012 summer season. As part of this new rulemaking, we will:
- Retain and expand the list of prohibited employment categories, including jobs that isolate Summer Work Travel participants from contact with Americans and work that is inappropriate for a cultural exchange.
- Strengthen the sponsors’ requirements for verifying job placements to ensure there are appropriate jobs for the students.
- Strengthen the cultural aspects of the program to ensure that the objective of the program – positive exposure to the United States – is accomplished.
- Require that an independent management audit be provided annually to the Department.”
Visa Diplomacy Trumps Concern for American Workers
In the 1980s, when the Summer Work Travel program was administered by the United States Information Agency, its regulations implicitly acknowledged that the infusion of young foreigners into local job markets could have an adverse effect on local job-seekers. The regulations required that as SWT sponsors prepared SWT participants to come to the U.S., the participants “should be fully briefed on the employment situation in the United States and advised not to seek employment in areas where a high unemployment situation exists.”1
Daniel Costa of the Economic Policy Institute has called that regulation “toothless and unenforceable.”2 Indeed, it was little more than a rule requiring a suggestion. That may explain why it no longer exists now that SWT is administered by the State Department.
And so, in recent years, SWT participants have taken jobs in areas notorious for high unemployment. For example, McDonald’s restaurants in the Washington-Baltimore area have employed hundreds of SWT students, including at least two Russians who in the summer of 2010 worked at the McDonald’s one block from the White House, on 17th Street.
The State Department, whose culture and worldview are shaped by a mission to win friends and influence people in foreign lands, has been oblivious to SWT’s effects at home. Abroad, it has engaged in “visa diplomacy”, touting the J-1 visa as a ticket for college students to work and travel in the U.S.
Even in 2009, when the recession caused State to request that sponsors scale down the numbers brought to the U.S., spokesman Andy Laine told the Baltimore Sun that the request was “a temporary measure… made out of concern for our potential exchange visitors, recognizing that they will face a difficult job market and high exchange rates.”3 There was no mention of unemployed Americans.
The GAO’s Failed Attempt to Limit SWT
The first attempt to constrain the Summer Work Travel program appears to have been made in 1990, as the General Accounting Office suggested limiting employers’ access to the young participants. The GAO issued a report that criticized some job placements as inconsistent with the intentions of the 1961 Fulbright-Hays Act, which created SWT and other exchanges.
The purpose of the legislation was “to increase mutual understanding between the people of the United States and the people of other countries by means of educational and cultural exchange” and “to assist in the development of friendly, sympathetic, and peaceful relations between the United States and the other countries of the world.”4
But the GAO said the employment of exchange visitors in such SWT job categories as waiters and cooks and amusement park workers did not serve “clearly educational and cultural purposes” and therefore “dilutes the integrity of the J visa and obscures the distinction between the J visa and the other visas granted for work purposes.”5
The GAO suggested changes in the federal regulations governing exchange programs in order to make them consistent with the intent of Fulbright-Hays. That proposal presented a threat to many SWT sponsors and employers, raising the possibility that their access to foreign students would be reduced.
The USIA later noted that the report had put SWT “under a cloud of uncertainty” and that exchange sponsors “have sought to resolve the question of Agency authority.”6 They got their wish. In 1998, Congress passed legislation that removed the cloud, allowing the USIA and later the State Department to continue to approve the job placements criticized by the GAO.
That point was driven home by Stanley Colvin, who at that time was director of State’s Office of Exchange Coordination and Designation. In a Hartford Courant story about Polish SWT workers who were complaining about “draconian” working and living conditions at a Six Flags amusement park in Massachusetts, Colvin told the newspaper, “These programs do not operate under Fulbright-Hays authority – period, the end.”7
The congressional move to remove the GAO’s cloud was a big victory for laissez-faire at SWT. It surprised some observers. Said Andrew Schoenholtz, director of law and policy studies at a Georgetown University, “Rather than change their policy to conform to the legislative intent, they’ve changed the legislative intent.”8
Sen. Udall Seeks “Proper Guidelines”
In 2011, Colorado Sen. Mark Udall, responding to a Denver Post article about the expansion of SWT at a time of high rates of youth unemployment, wrote a letter to Secretary of State Hillary Clinton expressing concern about the situation.
“I hope we can work together to maintain the true intent of the Exchange Visitor Program as an educational and cultural exchange that can serve as an important diplomatic tool while also protecting the interests of American workers,” Udall said in the letter.9 Udall spokeswoman Tara Trujillo said the senator wanted “to ensure that the proper guidelines are being upheld for hiring through the J visa visitors program and that American workers are not inadvertently hurt.”10
As this report has demonstrated, one of the most remarkable features of SWT is the absence of guidelines to protect American workers. The 1980s regulation for employers to attempt to steer SWT workers away from high unemployment zones was so meaningless that it has disappeared. Moreover, the State Department has promoted the recruitment of SWT participants around the world and their placement throughout the United State, without regard for, labor market conditions.
Nevertheless, when Joseph Macmanus, acting assistant secretary for legislative affairs wrote a response to Udall, he made this remarkable claim:
The State Department’s 22 years of managing SWT contradict that statement.
But now the new man in charge of State’s Office of Exchange Visitor Programs says he is serious about finding a middle ground between two competing concerns: American workers’ need for work and the State Department’s need to win friends for the United States by placing young foreigners in jobs that allow them to pay their own way.
“It is absolutely essential that we pay close attention to job opportunities for all Americans, particularly young Americans,” said Rick Ruth, Acting Deputy Assistant Secretary for Private Sector Exchange. “At the same time, it is also very important that we are able to carry out a foreign affairs function that allows us to reach out to young people and make sure that they understand America. The hard part is finding the smart middle ground between those two competing goods.”12
Ruth declined to comment on the position of Labor Department officials who, according to a 2005 Government Accountability Office report, stated “it is not likely that the exchange programs [including SWT] will have any effect on the U.S. labor market because of the small number of J-1 exchange visitors” (including 88,600 SWT workers in 2005).13
The GAO immediately added this observation: “The U.S government does not assess any potential effect of exchange programs on the U.S. labor market.”
As other stories in this series have shown, SWT has negative effects on young Americans, especially in areas where the foreign workers are concentrated, and especially at a time of deep recession. The potential for worsening negative effects is great, especially if the program is allowed to resume the growth that it experienced in the first decade of the new millennium. There are strong economic and political interests who want that to happen.
1 22 CFR PART 62 – Exchange Visitor Program, Sec. 62.80 Summer Student Travel/Work Program.
2 Daniel Costa, Employment Policy Institute, “J visas: Minimal oversight despite significant implications for the U.S. labor market”, http://www.epi.org/publication/j_visas_minimal_oversight_despite_signifi….
3 Scott Calvert, “Losing the Accent; Recession Means Fewer Jobs for Foreigners in Ocean City”, Baltimore Sun, May 22, 2009.
5 GAO report: “U.S. Information Agency: Inappropriate Uses of Educational and Cultural Exchange Visas.” http://archive.gao.gov/t2pbat12/140621.pdf.
7 Roselyn Tantraphol and Andre J. Bowser, “Polish Workers Criticize Six Flags”, Hartford Courant, September 4, 2002.
9 Nancy Lofholm, “Udall flags J visas: The senator asks about steps to prevent the program from displacing U.S. workers”, Denver Post, August 11, 2011.
11 Joseph E. Macmanus letter to Sen. Mark Udall, received from Udall’s office.
12 Rick Ruth interview with author.
Interview with Rick Ruth, Acting Deputy Assistant Secretary for Private Sector Exchange, November 3, 2011
What do you see as the importance of the Summer Work and Travel program?
The State Department oversees these programs because they are deemed to have a foreign affairs function. It is very important to reach out to the successor generation around the world, to reach out in large numbers, if possible, to make sure they have an accurate and first-hand understanding of America and who we are. We know how much misunderstanding about the United States there is in the world.
Your predecessor was widely regarded as having a laissez-faire approach to regulation and to SWT effects on job opportunities for young Americans. Is that a concern?
You’re not talking to a laissez-faire guy. You’re talking to a guy who’s interested in striking a proper balance between a number of competing interests. It is absolutely essential that we pay close attention to job opportunities for all Americans, particularly young Americans. At the same time it is also very important that we are able to carry out the foreign affairs function that allows us to reach out to young people and make sure that they understand America. The hard part is finding the smart middle ground between those two competing goods.
Summer Work Travel is under the State Department because it is supposed to be a cultural, educational experience for the participants. Work is its middle name. Work allows the participants to defray the costs of travel. That has always been seen as a worthwhile tradeoff, partly because it allows for large numbers to come, partly because it allows us to address a demographic that would not otherwise have the financial means to come to the United States.
What do you hope to accomplish with SWT?
I want to be sure that Summer Work Travel looks to you and me and any outsider like a genuine cultural experience. And to the extent that there individuals who would seek to have it be something else or use it for another purpose, that is something I have to address through reforms, through rules, through clarifications of policy, to try to preserve the core intent of Summer Work Travel.
Are you seeing intent to use it for something else?
Yes. There’s no question that any time you deal with mortal men and women and you deal with young people and stakeholders who have a variety of conflicting and competing interests, you’re going to have people who try to exploit the system.
Do you have the resources to do the job you want to do?
We have to grow our office and I plan to do that. This office will grow in size.
You need funding for that to happen.
That funding is secured … . The department has determined that the Summer Work Travel program as it exists today doesn’t look like it’s true to its original intent. It does need significant reform and there will be significant reform. We are present at the creation right now. Things are just starting.
What reforms are you looking at?
We are looking at a fundamental reorganization of the work component. Right now what we have is a fairly short list of prohibited employments. And then arguably everything else is open, subject of course to our notoriety and disrepute clause. We’d like to turn that around so that it’s much more focused on the affirmative, so that we’re talking about the kinds of employment that seem to make sense and be appropriate, such as employment that brings the students on a regular basis into contact with Americans. I would argue that contact with Americans, interaction with American society, is the essence of any cultural, educational program. So a situation where there’s a concentration of Summer Work Travel participants where they are not interacting with Americans during the day doesn’t look to me that it might fit the bill as suitable employment for a J-1 program.
Fish-processing jobs in Alaska, where some plants employ many SWT participants and few Americans, don’t seem to fit that description. But that job is very attractive to many foreign students because they offer the chance to make a considerable amount of money.
It is very attractive. But just as the Summer Work Travel program was not created to provide cheap employment for American employers, it was also not created to be a get-rich program for foreign students.
What is your opinion of the websites in which sponsoring organizations and their partners point out that if employers hire SWT participants they will pay less in taxes than if they hire Americans?
I am angry when I see those things because that is not what the program is supposed to be. Part of my job is to get the program back to where it is supposed to be and that will require some changes, not only in the regulation of the program, but in people’s expectations of it.
But you can’t change the tax structure.
I cannot single-handedly change the tax structure, but I can look at questions like what kind of work is suitable. I can look at the number of hours that young people are allowed to work every week. I can collaborate with other parts of the interagency process at the government to look at increasingly the areas of employment that may be prohibited because they may be excessively hazardous. Consultation is important here. We’ll talk to all parties as we go forward. But the main thing is we need to impose some reforms and strike a proper balance between various interests and make sure Summer Work Travel or any other J visa program is true to why it was created.
Does the culture of State require such an outward vision that you are unaware of domestic effects of SWT?
The answer is no. Of course not. When I say strike the proper balance among competing and important interests, I mean domestic interests as well.
Isn’t it clear that employers are incentivized to hire SWT students and ignore American workers?
There are employers who dispute the idea that that is a significant factor. But I understand that incentives are there.
What have you done to understand SWT’s effects on American workers?
When I came here one of the first things I looked for was a study where a university or organization has done research on the impact of the J visa holders on the American workplace. I would like to see that. I’m not sure that has been done. We might actually have to make that happen ourselves. I would love to see rigorous, independent analysis of this issue.
What is your opinion on the decline in participants in the SWT program, from a high of about 150,000 in 2008 to 103,000 in 2011?
I am comfortable with that. There is a lot of pressure from various sources to have it go up. I’m not concerned with pressures to have it go up. I’m concerned with the integrity of the program.
Do you anticipate disciplinary action against sponsors who have been negligent in overseeing the SWT program?
I can tell you we are pursuing a number of investigations against various sponsors. I can’t give you details.
Do you need to define what cultural exchange means?
That’s part of what I mean when I say I want to reorient job descriptions to be in the affirmative (not just a proscribed list), we have to have a prohibitive list. I don’t want to have: “you can’t do this” and then there is everything else. I would like to positively define the nature of the employment. I would like to pay much more attention to the cultural component. And I would like to find ways to get at the issue of the impact on Americans.
Are you confident you have the authority to reform the program?
I am confident I have the authority to do it … . The secretary has made it clear, the department has made it clear that summer work travel has merit but only if it is reformed to get back to its true intent.
Do you have a timetable?
It will be a rolling timetable. Some things can be done quickly. Others will take more time and consultation is highly important. I’m not going to go off uneducated or half-cocked.
There are competing goods. It is very important for the United States not to be misunderstood or stereotyped or hated by a new generation of young people around the world. How do we balance that? That is one of the hard questions. I am telling you there is now a commitment to do that.