It's About Money

September 7, 2008

It's About the Money
Guest workers programs, no matter where they are, are about making dollars and building economies. They are about businesses increasing their profits, often at the sake of low paid and disenfranchised workers. An article in the Saipan Tribune today points out another financial angle of the guest worker programs - fees. The CNMI government rakes in millions in fees that will reportedly be lost when the federal government takes over the guest worker program. The article claims:
The Department of Labor says the Commonwealth will lose about $4.4 million a year once the federal government takes over the local labor system.

Cinta M. Kaipat, deputy secretary of labor, said the department projects that it can generate about $6.1 million in revenues in the 2009 fiscal year and in each subsequent year. Factoring in its annual budget of $1.7 million, the Labor Department would bring in a net $4.4 million, or an average of $350,000 to $400,000 every month to government coffers.

“If federal officials are allowed to take over our labor functions, PL 110-229 is very specific; we will lose all labor revenues,” Kaipat said in a letter to the Legislature. “So come June 1, 2009, the Commonwealth will be short some $400,000 every month in its budget.”
Reps. Diego Benavente and Tina Sablan say that there are also savings that will come with the federalization of the program:
Rep. Tina Sablan, a supporter of federalization, echoed Benavente's statement and urged the Labor Department to provide lawmakers with a detailed computation of potential savings from federalization.

“Until we get a more balanced picture of what the impact will, I will consider this claim as nothing more than propaganda designed to get us to support the lawsuit,” she said.
They are correct. How about salaries, office expenses, utility costs and more that DOl pays out every year?

In another Saipan Tribune article, Senator Maria Pangelinan, chairwoman of the Senate Committee on Fiscal Affairs, said "that over two thirds of the government's budget will go to payroll. Personnel costs are expected to comprise $105 million of the government's $156.7 million budget for the 2009 fiscal year."

Isn't it time for the cash-short CNMI government to begin investigating reliable local sources of revenue including property, income, and sales taxes?

The article also discussed the "barred employees" list that supposedly prevents employees who owe workers money from hiring new recruits. Workers and others say the list, if it exists at all, is not enforced because they have witnessed that former employers who still owe foreign workers back wages through DOL administrative orders have been allowed to hire new foreign contract workers. I would like to see the list and compare it to the administrative orders that add up to $6.1 million. How many employers are on that list that now have new employees or have opened new businesses? I would guess quite a few. The article stated:
In her letter, Kaipat said the Labor Department is able to generate money faster now more than ever. The new automated processing system allows the department to collect fees faster. Fines are being collected from the old labor cases that have been resolved recently. And a more efficient “barred list” process ensures that employers who owe fines do not get services from the Labor Department until those fines are paid.
It's About Money
Speaker Arnold Palacios said that suing the federal government over PL 110-229 will cost millions of dollars, not the $400,000 the governor estimated. A Marianas Variety article reported:
“We should keep our eye on the ball,” he added. “The economic difficulties caused by the power crisis are much bigger than the administration’s projections about the impact of federalization.”

Palacios, in an interview, said most of the “concerns” mentioned by the administration — the loss of $5 million in local labor and immigration fees and the displacement of at least 60 local Immigration personnel — can be addressed through negotiations with the federal government.

“We’ve been blocking this thing [federalization] for over 20 years, and now one of our ‘white knights,’ our defender [lobbyist] Jack Abramoff has been sentenced to prison,” the speaker said. “If we didn’t fight this thing right from the start, we should have adjusted to federalization by now. It is this insatiable appetite for cheap labor that is causing all these problems, and I’m surprised that we are still trying to have these backward, labor-intensive industries while the rest of the advanced world is already moving toward high-tech industries.”

Palacios, R-Saipan, reiterated that the House will not appropriate the $400,000 in public funds requested by the governor.


The Saipan Blogger アンジェロ・ビラゴメズ said...

Did you steal that photo from

wd said...

From google images.

The Saipan Blogger アンジェロ・ビラゴメズ said...

I took that picture. Just trying to get some love.

wd said...

Love to you!