Sand Rant

Ten years ago, right before NAFTA (North American Fair Trade Agreement) was passed, the complexion of my workforce comprised of 85% White, 13% Hispanic and 1% Black. Today, my industry is 85% Hispanic and 15% White and the Black man has virtually disappeared. I cannot change the complexion of my industry, but I would sure like to help change the chumming of the waters when it comes to immigration and the necessary reforms.

When NAFTA passed it promised 120,000 new jobs, instead it has cost our country 2.3 million jobs and counting. It has also cost 10’s of 1000’s of small business closings and may be THE major contributing factor of our immigration problems. In order to compete as a U.S. based small business with legislation (NAFTA) that kills small businesses there are only two choices; reduce the costs of materials or reduce your labor costs. Well, the expectation that materials prices are going to drop are delusional, they have just continued to increase so the only other place to look is …labor.

In 1998, we were charging $19.95 net for our product, today 9 years later, despite the rising costs of material, insurance, energy, transportation…ad nauseam my product sells for $18.49 net. What used to be an 8-10% net margin is now a 3-5% net margin if we are lucky. A turn of that luck and we would be one of those small businesses that could not make it…another sad statistic.

We make it because of our *Hispanic workforce, just like every other small business in my industry. I cannot be competitive against Big Business without them. However, with them we face a new challenge: legality. So how do you we do that?

(I apologize for how long it has taken to get to the title of this rant, but I thought some context was needed.)

 

At a monthly business get together, myself and others were lamenting about how the hell do we keep on the right side of this immigration if we have no way of verification. Well, there is one and it is called the “Basic Pilot” program. Since I am the nerd in the group, I am assigned the task of getting together the details of this program. Needless to say, by the title of this diary, I was aghast!

First, there is a 4% error in the verification process, that means approximately 8 million working Americans employment records are not right. Ok, bad enough, but on the bright side, it might help to traverse this immigration mess.

Have you ever been a victim of identity theft? Welcome to the “Basic Pilot” Program, where 100’s of 1000’s of businesses are given the keys to the kingdom, access to a computerized networked system that is designed so that those businesses can verify your SS#, name and address. Get just one payroll clerk who sells or gives an employer’s PIN number to a thief or anybody else with the intentions of gleaning information, well, they are in heaven. Yes, there are firewalls, but really, who thinks they cannot be kicked down, once you have gotten into the house?

If you are an identity thief, and you’ve got my SS number, name and address…then you’ve got my life. You do not have to go through my garbage or a dumpster, you just have to sit at your computer.

Passing the verification of legal status onto an employer, making them the fall guys is just good cover and red meat for the Republicans the Bubba’s and a few Democrats beating the Immigration drum.

Instead of a comprehensive over-hall of our verification process, which I contend must be in the hands of the U.S. government, the government wants to pass it onto the business community, and by doing so, we may solve one problem, but create a even bigger one.

Lastly, and you can add to this list if I’ve missed something, this is what the U.S. government and some states have passed onto businesses, big and small in the last 80 years.

Collection of federal tax withholdings

Collection of state tax withholdings

Collection of social security payment

Matching social security

Collection of Medicare Matching

Medicare payment

Collection of court ordered child support

Collection of court ordered garnishments

Collection of bankruptcy judgments

Collection of IRS liens

Collection of state tax liens

Payment of unemployment taxes – state and federal

Payment into the state worker’s compensation fund

Administration and payment of a Health Insurance program (not mandatory but expected)

Administration and matches to a Retirement Plans (not mandatory but expected)

Now the U.S. Government wants to pass off the verification process and they want to do it with a fatally flawed system. Thing is, they have been warned, but because of the failure of this government (all branches) to bringing workable compressive immigration reforms to the table, they have chosen this path. Anything to pass the buck, I sure don’t want to be the Immigration Police…but it looks like it may be coming our way, and with using what is in place now…it is going to get ugly.

 

*Do not get me wrong here; there are unscrupulous employers in my industry just like any other industry. However, the vast majority is just trying to stay afloat in a business atmosphere where if you are not big enough to move your operation overseas to cheaper labor markets, then you, your business and your employees are under attack every day you have the doors open. It is not a pretty world out here and it is killing the one great thing that has fueled the success of our nation…the entrepreneur spirit. I can personally attest to that. Needless to say, I am a rabid small business advocate. George Sand