President Trump’s announcement last week that the fee for H1B visa applicants would rise to $100,000 should be welcomed. The much-abused and abusive temporary worker H1B, H2A, and H2B visa programs, greatly expanded by the late unlamented President George H.W. Bush, have been artificially wrecking the living standards of ordinary Americans for decades. This is not an accident; the programs are gifts to powerful corporatist lobbies who wish to subsidize their profits through massive inflows of cheap foreign labor. This is just the most egregious of the anti-market subsidies that have held back the U.S. economy and living standards for nearly a century and must be abolished.

To take a related subsidy example, whose removal is equally urgent: U.S. agriculture is currently directly subsidized, as well as being benefited by President Trump’s new tariffs. The subsidies are much the more damaging of the two agriculture supports, because they drain the Federal budget while tariffs support it. British agriculture in the 19th century was destroyed after 1873 by the lack of a tariff. U.S. agriculture subsidies were instituted during the Great Depression by the anti-market Henry Wallace. This is surely sufficient reason to regard them with the deepest suspicion.

In addition, agriculture benefits from the H2A visa scheme, which allows farmers to import low-wage labor, thus reducing their costs but imposing very substantial costs and pathologies on the community as a whole. This triple benefit to agriculture is utterly absurd; we should examine from first principles how to get rid of it.

There are two legitimate purposes for protecting agriculture: to ensure food security in case of a war and to protect a traditional way of life that depends on the land. Other purposes, in particular building giant export industries of uneconomic crops, are illegitimate, pointless and economically damaging. In the U.S. case, agriculture exports have increased by around 50% in real terms in the last two decades, and the two principal exports are soybeans and corn. These are both high-volume crops which can be grown and harvested on a mechanized basis with only modest use of labor. They thus do not need subsidized cheap labor, and using tax receipts to subsidize their production merely compels U.S. taxpayers to subsidize foreign corn and soybean buyers. If these industries are cost-competitive even without subsidies, no tariff is necessary; if they are not, a modest tariff will protect them, with their output destined only for the domestic market.

Almost all agricultural products can now be harvested mechanically; improved image recognition techniques since around 2010 and the advent of cheap drones have enabled technology to replace labor for essentially all crops. Therefore, importing cheap low-skill foreign labor to pick almonds, for example, merely imposes on non-almond-growers the huge long-term social costs of such labor. Instead, we must force the growers to invest in productivity-enhancing mechanization, which is now relatively cheap, as prices in the tech sector have come down so far. If there is a particular crop, pears for example, which is not economic to grow and harvest in the United States even with mechanization, then either pears can be imported from Chile, or wherever they are grown most efficiently, or a tariff can be imposed to protect the industry. Either way cash and labor subsidies are wholly unnecessary and economically damaging.

As Lord Liverpool’s Britain achieved rapid industrial progress through the Corn Laws, high U.S. labor costs must force the adoption of mechanized crop-harvesting techniques, which will improve productivity and the nation’s living standards. H2A visas retard this desirable evolution, and thereby lower wages and productivity throughout the U.S. economy. The H2B visa, meant for hospitality and construction, piles on to this effect but in sectors where the traditional cry of ‘there are no Americans willing to do the work’ beggars belief. It is madness to suppose a polity can become richer by importing surplus low-quality laborers; in an era of advancing AI, we will soon have our own surplus of untrainable workers, unless productivity growth and overall wealth are sufficient.

In a column earlier this year, I described the H1B visa system as attractive only to John C. Calhoun, who saw slavery as a “positive good” and had no problem with using unfree labor.

The H1B system is essentially one of indentured servitude, in which H1B workers cannot leave their employers. This makes those workers both docile and cheap, much to the taste of the tech billionaires who form the majority of their employers. However, the economic effect of a large volume of H1B workers is to lower domestic wages in the sector concerned, since employers will prefer tied indentured servants to a workforce of free non-slaves. Overall, the sheer number of H1B workers brought into the U.S. economy has lowered the early-career wages of domestic well-educated tech workers by about half compared with their compatriots in law, for example, where there is no such foreign competition because lawyers write the rules that prevent it.

The suppression of domestic tech sector wages and the addition of so many cheap foreigners under indenture contracts is highly attractive to tech billionaires, which is why they support this distortion of the labor market. It is also one reason for the bloated earnings and stratospheric stock prices of the “Magnificent Seven” and other tech companies, which has distorted the U.S. capital allocation process for nearly two decades, producing a blizzard of money pools which duplicate each other and now produce returns significantly below those in the public market.

However, overall the H1B program is thoroughly bad for the U.S. economy. For one thing, by lowering the rewards available to young tech graduates, it pushes the best students, who have multiple capabilities, into less economically productive fields such as law and to a lesser extent finance where no such suppression applies. Since these are the best students, they are mostly far more capable than the drones in the H1B sweatshops, so the level of innovation and entrepreneurship in the United States is correspondingly suppressed by the H1B program.

This thoroughly economically damaging program is typical of the policies pursued by the Bushes, father and son. Both were well to the left of the Republican party but succeeded because they were so well connected among the very rich donor class. Consequently, they had little economic idea of America’s needs. (The younger Bush must have slept through many of his Harvard MBA classes, because I can assure you that, having been there two years ahead of him, the information and expertise on how to build a free-market system was available, albeit mixed among a mass of woolly-headed statism and big-corporate ideology.)

Trump’s $100,000 application fee for H1B visas is a substantial step in the right direction, but there must be no loopholes. In particular, the nonprofit sector, which is overall thoroughly damaging to the health of the economy and society, must not be allowed to wriggle out of paying these fees. Foreigners who come to the United States to work in the non-profit sector should in any case be regarded with the deepest suspicion, since their objective is very often to subvert the healthy capitalist U.S. society; they should most certainly not be subsidized. Beyond this loophole, the whole immigration system remains excessively porous; even under Trump many foreign “asylum seekers” of little value are being admitted by open-borders fanatics within the bureaucracy. Overall, I would prefer that H1B/H2A/H2B visas be abolished altogether, or as a second choice, that the fee for H1B be $100,000 per annum, as Commerce Secretary Howard Lutnick suggested it would be. However, in the circumstances we must be thankful for small mercies.

While the short-term changes to be wrought by Artificial Intelligence have been overstated, and the trillions of stock market value created thereby are mostly vapor, over a 10 to 15 year view, there is no question that AI will revolutionize the workplace. It will eliminate millions of “drone” jobs, leaving at the bottom end only those like hairdressing with a major customer-facing component, while enhancing the capabilities of the best among us, creating huge numbers of new opportunities, the majority of which will require nimble, well-trained minds to take advantage of them.

If you look at the major users of H1B visas, they are companies like the big consultancies with millions of “drone” jobs but very little creative ability – even the pure tech companies on the list, like Microsoft and Apple are living almost entirely off intellectual advances that are a decade or more in the past. Hence, the United States needs a society in which the proportion of well-trained, nimble thinkers and companies is as high as possible. Mass importation of drone H1B visa holders on indentured servitude contracts by large dinosaur companies is thus the opposite of what is needed. The $100,000 fee for H1B visas should be taken merely as a partial step towards the program’s long overdue abolition.

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(The Bear’s Lair is a weekly column that is intended to appear each Monday, an appropriately gloomy day of the week. Its rationale is that the proportion of “sell” recommendations put out by Wall Street houses remains far below that of “buy” recommendations. Accordingly, investors have an excess of positive information and very little negative information. The column thus takes the ursine view of life and the market, in the hope that it may be usefully different from what investors see elsewhere.)