Rational Middle Podcast: Pat Kiley Discusses ID and Tax and History of Immigrants in Construction Industry

In a recent Rational Middle podcast, Pat Kiley, a founding principal of Kiley Advisors LLC, and former Chief Staff Executive for the Houston Chapter of Associated General Contractors (AGC), talked with host Loren Steffy about the history of immigration in the construction industry and the need for ID and Tax immigration reform.

Kiley started off by recalling on how many respectable Houston construction companies were founded by immigrants at some point.

“In 1909, Mr. Tellepsen got here after surviving malaria on the Panama Canal…Mccarthy and Gilbane, both founded by Irish immigrants escaping the potato famine. National Terrazzo Tile and Marble and Archie Longo left tough conditions in Italy in order to get to Houston,” said Kiley

“Then you get into the Mareks’ history here. They’re a very prominent company and a very superbly respected company. Their roots go back to Olomouc, Czechoslovakia in 1898 in escaping the Habsburg,” he added.

Kiley pointed out a recurring theme among the aforementioned founders. “An awful lot of times people were trying to escape tough conditions where they lived in order to make a better life for their families,” he said.

“They sort of followed their dreams and set up these companies. They weren’t afraid of tough work, they really embraced what can be a pretty physically demanding job” added Steffy.

“That is what is kind of the badge of honor of the construction guys is that not everybody can do it, and they are proud. They get to see the results, they get to take their kids and show them what they’ve worked on, and that seems to be something that really rivets them to America,” said Kiley.

Steffy pointed out how just like much our the last century, Texas’ construction industry continues to rely on immigrants, only today, many construction workers are undocumented immigrants.

Kiley then spoke on how decreases in access to legal immigrants has led to a large population of undocumented workers who have filled workforce shortages in the Texas construction industry, which results in an exploitative shadow economy.

“It’s a shame we don’t have legal access like we’ve had in the past, because this permits the dark side of this business, which allows people to abuse them. The people that are here without some kind of legal status…are forced to live in the shadows, and they’re forced to earn their money as they can. Regrettably, there are unscrupulous people who make some arrangements with them for a given rate and pay them much less than that in cash, because most of them work on a day basis,” Kiley said.

Kiley made it clear that the “unscrupulous” contractors he refers to are not the contractors he mentioned earlier. In fact, most of those general contractors he mentioned hold their sub-contractors to a higher standard.

“Fortunately we still have many general contractors that want the workforce of the subcontractors to be treated exactly the same as they would treat their own people. They want them on the payroll, they want them paid fairly according to the law with overtime… What’s interesting to me, some of the very finest employers that we have, those companies that I mentioned, are among the very best with their own employees, and demand the subs they have have a very solid legal program.”

Kiley also said that even with the recent corona-recession and increases in unemployment, the construction industry will continue to rely on immigrants. He said an AGC national survey from last fall revealed 81% of contractors were short on labor, and he doesn’t expect that to change any time soon.

“81% percent of those companies said they were short on labor. So we’re gonna bounce back, we’re gonna make up, and without immigrants we’re not gonna get it done,” he said.

One thing Kiley said would help the construction industry and the nation as a whole is an “ID and Tax”  immigration policy. He explained it as follows:

“First of all, identify and know who is here, and give undocumented immigrants some sort of status to be here that is legal, so they don’t have to be looking over their shoulder all the time. Secondly, tax them as we would our own citizens. In order for that to be effective, you’ve got to ensure that they work for people who are lawful employers. Obviously anybody with an unsavory background, you wouldn’t want to give some type of protected status to. Knowing who is here so we can identify and tax them, in the positive sense of that word, would be a big thing for America."

ID and tax is a policy considered by some conservative Texans to be the ideal solution to deal with the US’ current unauthorized immigrant population.

By requiring unauthorized immigrants who can pass background checks to pay taxes and also work for employers who pay taxes, it would level the playing field for American workers and businesses who are playing by the rules. Such a policy would also allow ICE to focus its resources on persecuting any unauthorized immigrants who commit violent or property crimes.

If such a policy was combined with other conservative measures like improvements to border security to prevent future illegal immigration, it would solve a lot of immigration problems and benefit US workers and the economy as a whole.  ​