This past week I traveled to Vancouver, Canada, to catch up on some writing projects. While here, I have noticed a contrast that becomes much more apparent when one crosses a continent and an international border.
Let me first describe the similarities. Both the North Country and Canada rest a fair amount of economic hope on the opportunity to attract investors abroad to their communities. In the United States, the EB5 program allows a foreign investor with as little as $500,000 to invest and create at least five permanent jobs. In return, they are given residency status and thus placed on a solid road to citizenship.
The Canadian version of such programs have been widely employed and wildly successful in attracting capital and jobs. The difference, though, is that the Canadian version is primarily bureaucratic while the U.S. version is primarily legalistic.
A U.S. EB5 application can cost $100,000 in legal fees alone, and often much more, and frequently takes years to approve. The Canadian version can work about as quickly as regionally based bureaucrats want to process it. From my casual viewpoint, it seems that the Canadian process is preferred.
Many of the investors are from China. My mother in Vancouver harbors the hope of selling her house to one of them when she is ready to move. That sentiment is very common in Vancouver. As a matter of fact, a local joke is that China would like to buy Vancouver, but Japan refuses to sell.
One may wonder why one would want to move the family wealth and entrepreneurial spirit from China to the United States or Canada. After all, China is creating great wealth and millionaires at a faster rate than anywhere else in the world.
Early in this Great Recession, I estimated that the size of China's economy will surpass the United States in 2020. I have since revised that date to 2018, primarily because recovery here has been held back by more United States political dysfunction than I could have imagined.