Some private gains are created by shifting costs onto others. The Accord prices those costs at the source: carbon, methane, speculation, systemic financial risk, pavement destruction, public-health harms, aquifer depletion, interchange extraction, and labor-market undercutting.
The current US immigration framework imposes uncompensated externalities in four directions and addresses none of them as a priced economic system.
Domestic low-wage workers absorb labor-market undercutting. When employers can hire immigrant workers below the prevailing wage, the local wage floor erodes for everyone in that occupation. The harm is concentrated in industries that use immigrant labor most intensively (agriculture, construction, hospitality, food service, certain healthcare segments) and falls on the domestic workers in those same industries.
Hosting localities absorb accommodation costs. Every immigrant family arriving in a community uses local schools, local healthcare, local housing capacity, and local infrastructure. The federal framework today provides no systematic accommodation-cost transfer to the hosting locality; the immigrant household pays state and local taxes over time, but the upfront accommodation cost-curve isn't matched by upfront federal funding.
Origin communities lose productive talent. Migration is a real option for the migrant; it's also a permanent loss of human capital for the origin community. The standard pattern is that origin economies that develop become less migration-source — but the development capital that produces that result has to come from somewhere.
Asylum and humanitarian obligations are politically contentious because their cost is unpriced. When asylum coverage is nominally generous but underfunded, the system fails everyone: claimants face inadequate process, communities absorb the cost, and the architecture's legitimacy erodes.
The Employer Parity Surcharge is a graduated labor-market-access charge. The employer pays the same as for a domestic hire — the full domestic-equivalent prevailing wage, plus the same employer payroll-tax share on top. The surcharge is withheld from the worker's wage at payroll (the employer remits it, like withholding): the worker's wage plus the surcharge on it together equal the domestic-equivalent wage — a 90% surcharge means the worker receives about half the domestic rate — and take-home rises toward full parity as the rate declines with tenure. The withheld surcharge is collected federally into a national pool; each host community draws its share by immigrant count and local need, spent locally on the services newcomers use. Misclassification is payroll-tax fraud with corporate liability.
The rate for a given hire comes from a published scoring formula over quantifiable factors — credentials and licensure, English-language score, years of experience, and an age band targeting young adults. The NSB calibrates the formula weights against measured supply and demand under a published, appealable, methodology-audited process; localities can nudge rates within published bounds for capacity, culture, and employer need. Origin country plays no role in the rate. Illustrative landing points of the formula (indicative, not statutory): ~12% for a credentialed nurse, ~40% for a licensed electrician, ~90% for seasonal manual work — each declining to a ~10% floor per worker by Year 9 as the worker integrates into the labor force and pays standard payroll tax and income tax. The 9-year glide path reflects the empirical pattern of immigrant earnings convergence with native-born peers — most of the convergence happens in the first decade.
The formula prices ultra-low-wage substitution out of existence by design — near the minimum wage there is no legal wage low enough to carry a ~90% surcharge (take-home cannot fall below the minimum wage, and raising the offer to make the math work costs more than a domestic hire), so those jobs are not fillable with immigrant labor. That is the point: the surcharge is the externality price of the schools, healthcare, and services host communities provide for the worker's family.
Volume is set by employer demand. The architecture replaces top-down visa quotas (which today produce both shortages and surpluses depending on industry) with a market mechanism: employers willing to hire at the full domestic-equivalent wage can hire; employers whose business model requires a wage discount can't. The system self-balances at the rate domestic labor-market conditions can absorb. Intake ramps 1.0M → 1.25M → 1.5M → 1.75M/yr over the first four years, each step gated on COMPASS absorption indicators — the administrative ramp of the new intake system, not a new quota concept.
Apportionment is COMPASS-weighted: heavier toward low-capacity / hollowed-out tracts that most need internal capacity (healthcare access, broadband, housing supply, civic infrastructure), lighter toward high-capacity cities with established immigrant-receiving infrastructure. Communities qualify both as places hosting admitted workers' families and as places hosting refugees or asylum seekers — refugee-hosting communities qualify even before residents are employed. Refugee + asylum-seeker healthcare is covered by Distributed Healthcare (the federal universal floor), not by a hypothecated surcharge slice.
No fixed federal percentages are published. NSB and Treasury set the apportionment weights against the COMPASS shortage-indicator suite — the rule-making travels with measured local need, not with political negotiation.
The admitted worker, through reduced take-home during the integration years: the worker's wage plus the surcharge on it (rate set by the published scoring formula) together equal the domestic-equivalent wage, so a ~90% surcharge means the worker receives about half the domestic rate — rising toward full parity as the rate declines with tenure, and ending at naturalization. The employer's cost is unchanged from a domestic hire — the full domestic-equivalent prevailing wage plus the same payroll tax — so industries that today use immigrant labor most intensively (agriculture, construction, hospitality, food service, certain healthcare segments) lose the historical wage discount entirely. Near the minimum wage no legal wage is low enough to carry the surcharge, so those jobs are not fillable with immigrant labor.
The architectural intent is that the externality — the schools, healthcare, and services host communities provide for the worker's family — is priced at the point of hiring. Hiring an admitted worker never costs the employer less than hiring a domestic worker; there is no discount to pocket. The mechanism aligns incentives toward fair-wage hiring without imposing top-down wage controls.
Domestic low-wage workers benefit from the floor effect: when employers must pay the domestic-equivalent prevailing wage, the local floor stops eroding. The surcharge is the architectural response to the long-running political fight about whether immigration suppresses domestic wages — by structurally pricing the suppression effect, the architecture removes the suppression rather than denying it exists.
Domestic hosting communities receive the entire surcharge, COMPASS-weighted. Low-capacity / hollowed-out tracts — the rural and small-town America most often described as "left behind" — receive the heaviest per-immigrant allocation, because that is where marginal capacity-building dollars travel furthest. High-capacity established cities, with deep existing immigrant-receiving infrastructure, receive a lighter per-immigrant allocation. The cost-curve mismatch (immediate accommodation costs, gradual integration revenue) is solved at the federal level. Communities can plan school capacity, healthcare capacity, and housing-supply expansion against an explicit federal funding stream tied to the immigrant population they're hosting.
Refugee and asylum-seeker hosting communities qualify even before the hosted residents are employed. Their healthcare comes from Distributed Healthcare (the universal floor); the surcharge funds the community-side capacity (housing, schools, integration support, civic infrastructure).
Pending canonical scoring.
Surcharge revenue scales with employer demand. At full deployment with current immigration patterns and parity-wage assumptions, the surcharge produces tens of billions per year in routed revenue — all routed to domestic hosting communities under COMPASS-weighted apportionment. The architecture is fiscally net-positive because the immigrant population pays payroll tax and income tax on the full domestic-equivalent wage from day one — a 20-year-old immigrant contributes approximately +$316,800 in net fiscal surplus over their working life under the architecture's modeling.
The Year-1-to-Year-9 glide path means individual surcharge payments decline as workers integrate. Aggregate revenue is determined by the inflow rate (new arrivals × landing-point rate) plus the integrating population (existing arrivals × declining rate); via residency-mix, aggregate community revenue stays roughly flat from Year 1. Steady-state arithmetic depends on the inflow rate, which depends on employer demand.
See tax ladder · fiscal scoring
- Below-prevailing-wage hiring
- Employers must pay the full domestic-equivalent prevailing wage — the same cost as for a domestic hire — and misclassification is payroll-tax fraud with corporate liability. There is no economic advantage to immigrant hiring: the cost is at parity, and near the minimum wage no legal wage is low enough to carry the surcharge, so those jobs are not fillable with immigrant labor at all.
- Visa-quota arbitrage
- Volume set by employer demand, not by top-down quota. Employers willing to hire at the full parity wage can hire; the architecture self-balances at the volume domestic conditions absorb.
- Cost externalization to localities
- The surcharge pools nationally; host communities draw a share by immigrant count and local need, matching federal funding to local accommodation cost-curve. Communities don't bear immediate costs they only recover over decades.
- Capacity-shortfall in left-behind places
- COMPASS-weighted apportionment leans toward low-capacity / hollowed-out tracts that most need internal-capacity increases — schools, broadband, healthcare access, civic infrastructure — turning the surcharge into a rebuild stream for rural and small-town America rather than a top-up for cities that already have the infrastructure.
- Refugee + asylum healthcare gap
- Refugee and asylum-seeker healthcare is covered by Distributed Healthcare (the universal floor), so the political fight over hypothecating surcharge revenue for humanitarian coverage disappears. The surcharge funds community-side capacity; the universal floor funds individual care.
The surcharge's design replaces structural failure modes of today's immigration architecture.
- Workforce Augmentation (Engine 4)
- Houses the broader immigration architecture and the surcharge mechanism. Detail at /calculator/employer-surcharge.
- FedCard
- Collection rail for the surcharge AND the disbursement rail for hosting-locality accommodation funds. Same universal-account infrastructure.
- payroll tax
- The employer pays the employer payroll share on the domestic-equivalent wage, identical for any hire; the immigrant worker pays the employee share on their own received wage and income tax on the remainder, on the same comprehensive base as native-born workers. The surcharge is a separate withholding remitted to the national community pool — not a payroll-tax component.
- Skills Wallet
- Naturalization triggers Skills Wallet accrual on the same footing as native-born workers (per /skills-wallet). The architecture treats long-resident workers and naturalized citizens identically.
- COMPASS shortage-indicator suite
- Drives the per-tract apportionment weights. Tracts with the largest measured shortages on healthcare access, broadband, housing supply, and civic capacity receive the heaviest per-immigrant surcharge allocation. NSB publishes the indicators; Treasury translates the weights into transfer schedules.
- Family-formation policy
- UCA, Baby Bonds, childcare mandate apply to all children present in the US, regardless of parents' immigration status. Family policy is universal at the child level.
The Employer Parity Surcharge sits in the Workforce Augmentation engine as well as Engine 1 (which scores the surcharge revenue). It interacts with the broader workforce architecture — Skills Wallet for native-born and naturalized workers, immigrant integration via the language and credentialing infrastructure, and the family-formation policy stack (Universal Child Allowance, Baby Bonds, family policy).
The Employer Parity Surcharge invites two attacks from opposite ends of the political spectrum. From the restrictionist side: employer-demand-set volume removes any cap on inflow, leading to unbounded immigration that overwhelms local communities regardless of routing. From the open-borders side: pricing the externality is treating migrants as a tax base to be extracted from, when they should be welcomed without conditions.
A more sophisticated objection: the Year-9 floor at ~10% becomes a permanent wage penalty on immigrant labor — even after full integration, an admitted worker takes home less than a citizen colleague doing the same job, so the architecture institutionalizes a second-class pay scale for the workers it admits.
Volume control: employer demand is bounded by the parity-cost requirement. Employers gain no price advantage from immigrant hiring — the cost is the same as for a domestic hire — so the volume that can be absorbed economically is the volume domestic labor-market conditions sustain, and intake is COMPASS-gated during the four-year administrative ramp. The architecture is more bounded than today's framework, not less.
Wage suppression: domestic wages are protected because the employer's cost is at parity — there is no discount for hiring an immigrant, so hiring an admitted worker can never undercut a domestic worker's pay. The declared prevailing wage itself is verified by revealed preference through the domestic-share test: when a category's domestic share shows the declared wage is a lowball no American actually works for, the surcharge for that category adjusts until the offered wage rises to a level domestic workers actually accept. An employer cannot lowball the declared wage and fill the jobs with economic-flight labor — the empty domestic share exposes the lowball and the dynamic rate forces the wage up. The Accord sets the goal, not a fixed prescription; thresholds, measurement, and the adjustment schedule are NSB rule-making. The immigrant's reduced take-home is transparent, priced, and convergent: it is the externality price of the schools, healthcare, and services the hosting community provides for the worker's family, it converges toward full parity by Year 9 as the rate declines with tenure, and it ends at naturalization. Alongside it the worker receives full legal status, Distributed Healthcare from Day 1, Skills Wallet accrual, and the Universal Child Allowance for qualifying children — a stated bargain, not extraction.
The Year-9 floor concern is real and architecturally addressed through the Skills Wallet + Workforce Augmentation pairing and naturalization: once a worker naturalizes, the surcharge no longer applies and take-home no longer distinguishes. The ~10% Year-9 floor reflects a residual integration cost that ends with citizenship; it is not a permanent penalty.
Honesty about gaps. The Accord's credibility comes partly from explicit acknowledgment of what is not yet specified. The items below are flagged for v10.2 specification or for outside expert review.
- COMPASS-weighted apportionment: the exact weight function (which COMPASS indicators load most heavily, how absolute vs. relative thresholds combine, how the rule-making handles rapid migration shifts) is set by NSB / Treasury and adjusted on a published schedule. The principle is fixed — heavier toward low-capacity / hollowed-out tracts, lighter toward high-capacity established cities — but the specific weights are not published as fixed percentages.
- Worker-aged-20–35 prioritization mechanism: the +$316,800-net-fiscal-surplus calculation depends on the age priority. Whether priority is enforced through Wedge-rate variation, visa-class structure, or other mechanism is pending specification.