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India-US Relations Blog

Yesterday, once more?

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And just like that, the much awaited, once postponed India-US Strategic Dialogue came and went, with not even the the tiniest frisson of excitement of that had accompanied previous Dialogues. Minders on both sides must have been secretly pleased that the Murdoch slugfest in London came in as a suitable excuse to explain away the limited interest and analysis of the Strategic Dialogue in the media. With new lists of grievances building up on both sides to replace the long-drawn out lists of the Cold War era, the Strategic Dialogue process has had the unintended consequence of focusing attention on these issues for which all available political capital has been expended or there is no solution even at the highest political levels.  Given this reality, the reports of half-hearted wagging of fingers and admonishments behind closed doors were more for the benefit of respective constituencies than to move the process forward. The overriding urge to prevent any SNAFUs meant that Mrs. Clinton proposal to visit Kolkata as part of itinerary was shot down by the hosts. And whilst Mrs. Clinton broke bread with all her leading interlocutors, from the Prime Minister downwards, the glaring exception was Defence Minister A K Antony, for whom the Dialogue that was to take place in April had been postponed since he was ostensibly busy with the Kerala elections.

01-1The U.S. side, in particular, has become a master at the art of coming out with comprehensive factsheets laying out the massive advances in joint projects, emphasizing the width and breadth of the partnership.   With many of the bilateral agreements signed over the years stuck at various stages of implementation, it is almost as if both sides were virtually scrapping the bottom of the barrel this time around to come out with agreements on cyber security cooperation and cooperation in aviation safety. This is not to belittle the importance of these agreements, and particularly the one on cybersecurity. However, the impression one gets is that there is still a sufficient amount of mistrust on both sides to ensure that even this initiative will live uptoits potential for some time to come. By way of comparison, the agreement between cyber adversaries Russia and the United States on cyber security cooperation signed just the previous week is much more specific on actions and timelines.

But it is not as if Mrs Clinton would be particularly disappointed by either the dampened expectations or outcome of her visit. From an American perspective, given the flux in the wider Asian region, accelerating the strategic partnership with India in the security and defence realms, especially if it is only on the back of unilateral concessions, will only fetch diminishing returns. One only needs replace India with the U.S. in the previous sentence to come up with the Indian view. On the American side, there is reasonable confidence that an increasingly powerful and belligerent China will eventually drive India into U.S. arms. In the meantime, there is plenty of other fish to fry, particularly when it comes to pushing the economic and people-to-people aspects, part of larger initiativesthat Mrs. Clinton has focused on since taking up stewardship of the State Department.  And therefore it is not surprising that out of the many factsheets brought out by the Department at the end of the visit, it is those on economic ties and education and people-to people ties that have the most substance. While the former leads with talks on a Bilateral Investment Treaty, there is a consolation prize in the establishment of the first ever Consular Dialogue to take place on July 25 “for a full discussion of visa and other consular matters”. From Tri-Valley to the harassment of H1B visa holders and diplomatic pat-downs, there will be much to discuss at this Dialogue. Considering that a similar Consular Dialogue has been part of the EU-IndiaStrategic Dialogue since 2000 and the India-Australia Dialogue more recently,one wonders why this did not come into being earlier even earlier.

On the education and people-to-people front, the noteworthy developments are the publication of the first request for proposals under the aegis of the Obama-Singh Knowledge Initiative with the fields of focus being Energy Studies, Sustainable Development, Climate Change, Environmental Studies, Education and Educational Reform, and Community Development and Innovation. How different this Initiative is from existing programs being carried out under the India U.S. Science and Technology Forum remains to be seen.  The other interesting program to watch out for would be the newly launched Passport to India which will facilitate increasing number of American students to come to India for periods ranging from three weeks to six months, to match the 100,000 odd Indian students in the United States. This, too, has an economic focus since the students will be here on internships with companies rather than for study programmes.

The silver lining in this particular cloud might be this; with both sides forced by exigencies to dial down the relationship a notch, this provides some breathing space to consolidate the initiatives that have been taken up in previous years. The U.S. State Department Inspector General’s office  has recommended that a separate office be established for India since “nations of comparable importance and with important bilateral relationships, such as China, Russia, Cuba, Canada, Japan, Korea, Mexico, Afghanistan, and Pakistan, have their own offices”. A similar initiative on the Indian side would go a long way in implementing the many worthy initiatives of the Strategic Dialogue and make it less of the annual junket that it is being perceived to be.

India-US Relations Blog

Taking the Long View

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Over time, the expansion of Chinese strength will undoubtedly push New Delhi to tighten its security relations with Washington, though the process will neither be as smooth nor as speedy as many would like.

Just as US-India ties were at a nadir following New Delhi’s nuclear tests in 1998 – and just as the United States and China were declaring their own strategic partnership – Prime Minister Atal Bihari Vajpayee famously characterized Washington and New Delhi as “natural allies” who would form “the mainstay of tomorrow’s stable, democratic world order.” Two years later, Vajpayee reaffirmed this description.

Judging by the dense bilateral links the two countries have crafted over the past decade, Vajpayee phrase seems to have been vindicated. Not only have a landmark civilian nuclear accord and a spate of defense contracts been concluded, but the two countries have established some 30 bilateral dialogues and working groups on a wide gamut of issues, and the United States holds more bilateral military exercises each year with India than with any other nation.

Yet U.S. elites are suddenly shying away from the term “ally.” Assistant Secretary of State for South & Central Asia Robert Blake, for instance, states that “India and the United States will never be allies in the traditional sense of the term.”  Strobe Talbott, who as Deputy Secretary of State in the Clinton administration began the first institutionalized dialogue between Washington and New Delhi, contends that the countries “are not now, and may never be, allies.” Stephen P. Cohen, dean of U.S. South Asianists, likewise maintains that “India is a friend, not an ally” and the new US-Indian strategic alliance is “still more symbolic than real.”

All three underscore the distinction between long-standing U.S. allies, such as the United Kingdom, Japan and South Korea, and partners like India that are not bound by formal security commitments. And Blake’s statement was undoubtedly in deference to Indian sensitivities about being sucked into America’s strategic orbit, although he adds that India can no longer be considered a non-aligned country given the “increased convergences in strategic outlook” between Washington and New Delhi. But Talbott and Cohen are less sanguine on this count. The former argues that:

“One reason we may never be [allies] or not in the any foreseeable future, is because there is still a huge constituency in support of India’s non-aligned status, despite the fact that I would say that non-alignment and the non-aligned movement is very much an artifact of the Cold War. I remember having a conversation with Natwar Singh [retired Indian diplomat and Manmohan Singh’s first foreign minister] when Congress was out of power and him saying to me that the proudest moment of his career was being secretary general of the non-aligned movement. That sticks in my mind. I took that as a sign that there are still a lot of Indians who take non-alignment seriously.”

Cohen strikes a similar note: “New Delhi has a deep commitment to strategic autonomy, as indicated by its insistent use of the moderating prefix ‘natural’ to describe its U.S. relationship. In the end, India got what it needed from Washington, including recognition of its nuclear weapons program and support for its permanent membership on the United Nations’ Security Council, at little or no cost.”

Believing that strategic ties remain, at best, “aspirational,” Michael Auslin, at the American Enterprise Institute, likewise notes that the

“continued adherence to Jawaharlal Nehru’s non-aligned strategy clearly animates the worldview of most thinkers [in India], even if the language used to describe it no longer partakes of such Cold War imagery. There is a firm commitment in New Delhi not to have any firm commitments to any one state. It seems the Indians have taken to heart, far more than the Americans, George Washington’s warning against entangling foreign alliances.”

All of these comments come at a time of widespread disappointment in Washington that the bilateral relationship has not lived up to the strategic and economic possibilities that seemed so alive just a few years ago. As my last post noted, some observers are even questioning whether the Bush-Singh nuclear deal has succeeded in its primary aim of invigorating US-India geopolitical cooperation in the face of a rapidly growing and more assertive China.

The Bush administration devoted singular energy to courting New Delhi as a key part of its strategy of strengthening security links with China’s neighbors. In a widely-read article, Condoleezza Rice, then serving as chief foreign adviser to the George W. Bush presidential campaign, observed that Washington “should pay closer attention to India’s role in the regional balance.” She pointedly noted that “India is an element in China’s calculation, and it should be in America’s, too.” In his first major foreign policy address as a candidate, Bush argued that “we should work with the Indian government, ensuring it is a force for stability and security in Asia.”

Once the nuclear deal was unveiled at a July 2005 summit between Bush and Prime Minister Singh, Rice justified it by calling India “a rising global power that we believe could be a pillar of stability in a rapidly changing Asia.” At the summit, a senior Indian diplomat was quoted as saying that “Bush has a vision that we in India often don’t have. With Europe in decline and China rising, the U.S. sees India as a future global power with the ability to maintain [the] power balance in the 21st century.” A Bush administration official closely involved in the making of policy toward New Delhi commented that “China is a central element in our effort to encourage India’s emergence as a world power. But we don’t need to talk about the containment of China. It will take care of itself as India rises.”

Singh-Wen_PhotoIn the years since, has the growth of Chinese strategic power nudged Washington and New Delhi into tighter security collaboration, as many in the Bush administration expected? Or is Michael Krepon, one of the nuclear deal’s prominent detractors, correct in arguing that “New Delhi continues to titrate improved strategic cooperation with the United States” and that it “continues to improve ties with Beijing.  It is folly to presume that Washington can leverage New Delhi’s dealings with Beijing.”

There’s no denying the American disillusionment caused by India’s rejection of Boeing and Lockheed Martin’s bids in its $11 billion fighter aircraft competition and by the prolonged inability of U.S. companies to capitalize on the nuclear deal due to an Indian liability law that does not conform to international norms. It is also true that India and China have aligned to thwart U.S. objectives in global negotiations on trade and climate change, and that they often take the same side in UN deliberations.

But stepping back a bit in order to take in the wider perspective, it is clear that some fundamental geopolitical forces are at work in spurring India-China strategic frictions.  Instead of being the fraternal titans that drive the Asian Century forward, as envisioned in the “Chindia” chimera, it is more likely that their relationship in the coming years will be marked by increased suspicion and rivalry. The relationship has never really recovered from the trauma of their 1962 border war, and the strains have only increased over the past five years or so. Beijing is now taking a much more hawkish line on territorial disputes in the Himalayans, including asserting a brand new claim that the Indian state of Arunachal Pradesh is actually “Southern Tibet.”  It is also expanding its presence in territory controlled by Pakistan, and trying to block New Delhi’s efforts to play a greater role in regional and international institutions.

Much is made of the fact that China is now India’s largest trading partner and that two-way trade soared from $12 billion in 2004 to $60 billion in 2010, and that the countries are on track to reach $100 billion in 2015. When Premier Wen Jaibao visited New Delhi last December, he brought along a larger business delegation than President Obama did a month earlier, and the $16 billion in resulting trade deals eclipsed the $10 billion-mark struck by the Americans. Yet compared to US-India economic links, there are far more competitive elements, and far fewer complementary features, operating in India’s business interactions with China.

All of these developments have not gone unnoticed by the Singh government.  Famous for his cautious, taciturn nature, Singh has caused a stir with his public expressions of disapproval regarding what he terms Chinese “assertiveness.” In a September 2010 interview he complained that Beijing sought to “keep India in a low-level equilibrium” and that “it would like to have a foothold in South Asia.” Three months later, he shocked his Chinese guests during the Wen visit by refusing to reiterate India’s traditional endorsement of the “One China” policy or customary recognition of Tibet being an inviolable part of the People’s Republic.

Indian military planning is also increasingly focused on the threat from its northern neighbor, from taking major steps to fortify its northeastern border to accelerating the development of the Agni-V ballistic missile. With a reach of over 5,000 kilometers, and capable of carrying multiple warheads, the missile puts China fully within range of a retaliatory nuclear strike.

The strategic entente with India is Washington’s first geopolitical partnership to be forged in the post-Cold War era, meaning that its rhythm is bound to be quite different from the security alliances the United States rapidly created in the aftermath of World War II. Back then, the national power of Washington’s new-found allies was in stark decline, while India’s current power trajectory is visibly upward. The structural dynamics of a bipolar global order also were simpler than today’s messy multipolarity.  Over time, however, the expansion of Chinese strength will undoubtedly push New Delhi to tighten its security relations with Washington, though the process will neither be as smooth nor as speedy as many would like.

India-US Relations Blog

Change of Helm in Washington; Nirupama Rao to be the Ambassador

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The road to becoming the Indian Foreign Secretary most certainly runs through the ambassadorships in Beijing, Islamabad and probably Kathmandu and Colombo. Nirupama did Beijing and Colombo and now after a successful stint as Foreign Secretary, is slated to become India’s most high profile ambassador – in Washington. It is customary to say that appointments like these take place at a critical or crucial juncture.  Is it a crucial time? Not more than at any other time.

credit: theindiaexperts.comAlthough a number of reasons can be found to explain why the Indo-US relationship is currently in a parlous condition. The biggest blow comes undoubtedly from the elimination of the U.S. from the MRCA competition, quite probably for purely technical reasons. But there is another side to the Nirupama story. That is the story of the U.S. ambassador in New Delhi. After the performance of absolute cracker – Jacks like Robert Blackwill, Frank Wisner, Dick Celeste and many others, the performance of the current US ambassador in Delhi has been entirely forgettable. If it meant much to the U.S. to get short listed in the MRCA competition, one wouldn’t have guessed so from the activities or the lack of them at Roosevelt House. The U.S. ambassador’s office and residence was constantly buzzing during the time of the U.S. nuclear deal, but that was probably a stunning one – off performance – when the U.S. embassy mustered a huge public relations campaign on behalf of the deal, and followed it up with a command performance at the NSG waiver at Geneva.

Since then it’s all been downhill. No visiting congressmen in Delhi – or if there were, they kept a low profile. The result of all this is that Nirupama Rao has a job in hand- putting some heat into the relationship. As the PR blurbs say, the Indo- U.S. relationship is so multi-faceted that many parts of it run on automatic. So if the U.S. didn’t get the MRCA, it did get the torpedo deal, the C -17 deal and will probably get the howitzer deal. Institutionally the Indo-US relationship is incredibly strong, running as it does through 13 forums or dialogues. These include the Strategic Dialogue, Foreign Office Consultation, Defence Planning Group, Joint Working Group on Counter Terrorism, the US-India Economic Dialogue, the CEO Forum, The Trade Policy Forum, The Energy Dialogue, Global Climate Change Dialogue, Information & Communication Dialogue, Science and Technology Forum, Education Dialogue and Health Cooperation Framework. That list should knock anyone out – but more importantly demonstrates how many joint bodies can be set up to produce very pedestrian results. In the entire run-up to the Obama visit probably one or two of these forums actually produced tangible agreements for the heads of state to sign.

The question also arises rather sharply, that if the state to state relationship runs through 13 standing forums, what can one ambassador do? Actually, she can do a lot. Because if even one or two of these forums actually click, the results can be spectacular. But this raises the important issue, of how much of the relationship is ‘managing’ and how much is old fashioned ‘diplomacy’? It probably is still a mixture, with more and more work between the two countries being conducted ‘outside’ the embassies and through the forums and through communities. Actually it was a US congressman (unnamed) who came to Delhi may years ago and said that U.S. foreign policy is controlled more through congress. According to him, other countries need to imitate China, in building up lobbies within congress rather than running formal diplomacy through the Embassy. This may or may not be true, but Nirupama has very little time to find out as she heads West to represent India in Washington. We certainly don’t want to repeat the NRI ambassador fiasco but if Nirupama can yet go beyond Foggy Bottom to get to grips with her job it would be worth watching.

Defence And Strategic Affairs Blog

Nuclear Dividends?

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Was the U.S.-India agreement on civilian nuclear cooperation worth all the trouble? Six years on, observers in both countries are accusing the other of perfidy.

Was the U.S.-India agreement on civilian nuclear cooperation worth all the trouble?  How have the expansive promises touted by its champions and dire warnings issued by its critics panned out? With the approach of the six-year anniversary of the landmark July 2005 summit between President George W. Bush and Prime Minister Manmohan Singh, observers in both countries are at work tallying up the pay-offs and drawbacks.

PhotoThe Bush-Singh deal was momentous in both symbolic and material import. It implicitly recognized India as a nuclear weapons state, a gesture New Delhi very much wanted but which the Clinton administration refused to make. And by promising to end a decades-long embargo on nuclear energy technology against India, the Bush administration committed to overturning U.S. laws and global non-proliferation norms for New Delhi’s singular benefit.

At the time, U.S. advocates spoke of portentous opportunities in the strategic and commercial realms. A high-ranking U.S. official described the deal as “the big bang” designed to consummate a broad strategic relationship with a rising India that was aimed at balancing China’s burgeoning power. Ron Somers, the head of the U.S.-India Business Council, argued that “history will rank this initiative as a tectonic shift equivalent to Nixon’s opening to China.” Leading U.S. corporations quickly lined up, expecting that a grateful Indian government would reward them with lucrative contracts in the nuclear power generation and defense systems fields. Estimates were floated that access to India’s expanding nuclear energy sector would alone generate some 250,000 U.S. jobs.

Have the promised gains materialized? According to Michael Krepon (here and here), a prominent critic of the accord, they have not.  Pointing to India’s recent elimination – in the face of heavy U.S. lobbying – of Boeing’s and Lockheed Martin’s bids in its $11 billion fighter aircraft competition, as well as New Delhi’s failure to support U.S. diplomacy on the Libya and Syrian issues, he contends that the significant U.S. concessions made in the agreement have netted little in terms of a strategic or diplomatic return. Likewise, he notes the tough nuclear liability law adopted by India last year has the effect of all but blocking the involvement of U.S. companies in the country’s nuclear energy sector.

The accord’s advocates contended at the time that by granting India a special position in the global nuclear order, the nonproliferation regime would ultimately be strengthened. But Krepon believes the reverse has occurred. By bending the rules for India’s sole benefit, a pernicious precedent was set, one that China has just exploited in justifying its sale of two more reactors to Pakistan. And the failure to extract meaningful restrictions on India’s nuclear-weapon capacity has only spurred a paranoid Pakistan to undertake a significant expansion its own arsenal.

Krepon does not deny that bilateral diplomatic and economic ties have improved measurably in the last six years. But much of this, in his opinion, would have occurred even in the accord’s absence. From his vantage, the accord’s actual benefits are far from what was pledged, while the costs critics warned about have been substantiated.

Krepon’s critique arrives at a time of widespread disappointment in Washington that bilateral ties continue to fall far short of the promise that seemed so glistening just a few years ago. In an interview prior to his departure from New Delhi, U.S. Ambassador Timothy J. Roemer chided the Indian government’s failure to live up to its side of the bilateral relationship, adding that “There’s no doubt this needs to be a two-way street.”

The reasons for this sense of letdown are many, with fault lying both in Washington and New Delhi. Nonetheless, U.S. champions of the Bush-Singh deal were under no illusion that India’s signature registered its enlistment as America’s junior partner in global affairs or the surrender of its foreign policy independence.  For example, Nick Burns, who as Under Secretary of State for Political Affairs in the last administration played a key role in crafting the new U.S.-India relationship, cautioned at the time that “the United States must adjust to a friendship with India that will feature a wider margin of disagreement than [Washington is] accustomed to.”

And even as the deal was proceeding, the two governments were at loggerheads in multilateral trade talks, an impasse that helped bring about the Doha Round’s collapse.  Paradoxically, the U.S. Congress gave its preliminary assent to the nuclear deal in December 2006 at the same moment that frustrations with New Delhi’s position in the Doha negotiations caused legislators to cut some of India’s trade privileges under the Generalized System of Preferences. And in the months prior to Congressional approval of the implementing “123 Agreement,” a high-ranking Bush administration official publicly accused New Delhi of stymieing negotiations and “working behind the scenes for Doha’s demise.”

India’s decision on fighter aircraft was a sharp disappointment to an Obama administration that lobbied strenuously on behalf of the U.S. contestants – so much so that the decision may have even hastened Ambassador Roemer’s resignation.  And it undoubtedly deepens the perception in Washington that New Delhi has not lived up to its side of the bargain by reciprocating the huge commitment the United States has made over the past decade to bolster India’s great power prospects. But as Ashley J. Tellis demonstrates in a superb piece of analysis, the decision was sui generis, involving the Indian air force’s rigid application of technical desiderata, rather than the anti-U.S. move some have described it as.

The proliferation-related arguments Krepon reiterates formed the core of the criticism against the accord when it was originally announced. But these points were difficult to sustain at the time in view of the strong support Mohamed ElBaradei, then director general of the International Atomic Energy Agency, gave to the deal. He called the agreement a “win-win” as well as “a milestone, timely for ongoing efforts to consolidate the non-proliferation regime, combat nuclear terrorism and strengthen nuclear safety.” He has reaffirmed this view in his new book. And in case anyone missed the significance of ElBaradei’s endorsement, this is the same man who butted heads with the Bush administration over nuclear weapon allegations regarding Iraq and Iran – actions that helped earn him the Nobel Peace Prize in 2005.  In the end, most nations were persuaded by his view that it was better to welcome New Delhi into the nuclear clubhouse, even if somewhat awkwardly, than to continue leaving it out in the cold.

It should also be noted that as the nuclear accord was being debated by the international community, Beijing explicitly assured Washington that it would not exploit India’s special carve-out in the nonproliferation regime to provide more reactors to Pakistan. It is also unclear how large a factor the deal looms in the rapid expansion of Pakistan’s nuclear weapon capabilities. Most likely, Islamabad’s anxiety about India’s “Cold Start” military doctrine – which focuses on deterring Pakistan’s use of jihadi proxies by holding out the threat of swiftly-mounted but calibrated military offensives against Pakistani territory – plays at least as significant a role.

While Krepon accuses India of failing to live up to the broad spirit of the Bush-Singh deal, Indian observers are presently charging Washington with an outright breach of faith. Specifically, they see restrictions just promulgated by the 46-nation Nuclear Suppliers Group (NSG), an informal cartel regulating global nuclear commerce, as undercutting the privileged perch the accord gave India in the international nuclear hierarchy. The NSG prohibitions are designed to prevent the spread of uranium-enrichment and spent-fuel reprocessing technology to countries, like India, that have not signed on to the Non-Proliferation Treaty.

Technically speaking, the provisions, which were advanced by the Obama administration, are not country-specific. However, there is little question they are aimed squarely at India, and this has revived cries about American perfidy that were at fever pitch in New Delhi’s tumultuous debate over the nuclear accord three years ago. Once again, the Communist Party of India and the Bharatiya Janata Party are making allegations about Mr. Singh’s lack of candor in revealing the agreement’s details.

Anil Kakodkar, a former chairman of the Indian Atomic Energy Commission who played a major role in drafting the nuclear deal, has also joined the present fray, characterizing the NSG move as a “betrayal,” while G. Parthasarathy, a leading light in the foreign policy establishment, concludes that “we cannot trust the U.S. as a long-term and reliable partner on nuclear issues.” The Hindu newspaper exclaims that “the Indian side has scrupulously adhered to its side of the broad bargain and has assumed the U.S. and the NSG would do the same. But if the latter are going to cherry-pick which of their own commitments they will adhere to and which they will not, India may well be tempted to examine its own options.” Indeed, the Indian government has threatened to withhold coveted reactor contracts from any country enforcing the new rules.

Beyond the perceived affront to national honor, made all the more palpable since the NSG was founded in response to India’s first nuclear detonation in 1974, it is unclear whether the restrictions will have any practical effect. India already can reprocess material from its fast-breeder reactor program to supply its nuclear arsenal. And the country’s chief nuclear partners – the United States, France and Russia – have rushed to assure New Delhi that the restrictions will in no way impinge upon their previous commitments. Still, it is curious why the Obama administration chose to press the new restrictions at the very same moment it was championing New Delhi’s membership in the NSG (read the U.S. paper on India’s candidacy here).

The growing irritations on both sides will be aired out at the mid-July convening of the U.S.-India Strategic Dialogue in New Delhi. The confab was originally scheduled for April but was postponed, ostensibly at least, because Defense Minister A.K. Antony had to campaign in the Kerala state elections. More likely, Antony and others in the Indian leadership were looking for an excuse to dodge the Obama administration’s full-court press on the fighter aircraft decision. As it turns out, the meeting will now take place with both sides nursing grievances.

Immigration Blog

Employers May Soon Need Approval From a Federal Database for New Hires

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It is surprising that only months after taking office on a platform of smaller government, House Republicans appear poised to enact a program that some consider to be quite a big government solution to illegal immigration. The legislation is H.R 2164, sponsored by House Judiciary Committee Chair Lamar Smith (R-Texas). It bears watching in the coming weeks.

E-Verify is an electronic employment verification that allows employers to send, generally speaking, the name and social security number of a potential new hire and get back an answer from the federal government as to whether that individual is legally authorized to work in the United States.

The key issue is not whether such a system should exist. The issue is whether the federal government should require every employer in America to use E-Verify, as mandated in H.R. 2164.

In theory it may make sense to have such a system for checking new hires. But in practice it may be an entirely different story. A new report I completed details some of the problems with making E-Verify mandatory. (A copy of the report can be found here.)

First, it is unclear whether the system will actually reduce illegal immigration in any significant way. A government report by the consulting group Westat found about half of illegal immigrants show up in the system as work authorized, primarily, it’s assumed, by using a false identity. In addition to identify fraud the system could be thwarted by employers that decide not to submit the names of employees suspected of being illegal immigrants.

Second, the errors in the databases are likely to affect individuals here lawfully who seek jobs but are mistakenly shown by the system to be not authorized to work. This could be a major problem, since even under the current system employers often go against protocols and “pre-screen” applicants. That means individuals may not even realize why they are not called back after a job interview.

Misspellings of names and naturalization can lead to errors in the database. It is not surprising that someone with the name Mukherjee or Chidambaram is more likely to have a database error than a guy named Smith or Jones.

By some estimates foreign-born individuals are far more likely to experience problems with the Social Security or U.S. Citizenship and Immigration Services databases than native-born. “E-Verify error rates are 30 times higher for naturalized U.S. citizens and 50 times higher for legal nonimmigrants than for native-born U.S. citizens,” according to Congressional testimony by Tyler Morgan of the National Immigration Law Center.

Third, employers should be aware that H.R. 2164 vastly increases fines not only for employing illegal immigrants but also for what may be considered paperwork violations or a failure to submit an individual through the E-Verify system. The legislation puts in place a system more complex than simply checking new hires. An employer is also required to check existing employees under certain circumstances, including if an employee starts working on a state or federal contract or is within 30 days of work authorization expiring. A government allegation that workers were misclassified as independent contractors (and not required to be checked through E-Verify) rather than as employees could potentially trigger fines of at least tens of thousands of dollars.

The House legislation provides a short window for this to be up and running. The largest employers would be required to use E-Verify within 6 months, employers with between 20 to 499 employees within 18 months, and those with 1 to 19 employees would be required to use E-Verify within 24 months. A Senate bill, sponsored by Senator Charles Grassley (R-IA) has a shorter window – one year for all employers – and requires all existing employees to be verified as well.

The House legislation could be marked up in the Judiciary Committee as early as this month. If it became law it could mark an enormous change in the operation of the U.S. workplace. Supporters of the bill view that as a good thing. Others are not so sure.