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How The Government Is Causing A Crab Cake Shortage

The Law of Unintended Consequences hits the Maryland crab industry.

In an illustration of the Law of Unintended Consequences, it appears that President Trump’s new restrictions on legal immigration may be about to have an unforeseen effect that adversely could impact seafood lovers across the country. The crisis will be most pronounced in the Chesapeake Bay state of Maryland where the new immigration policy has led to a shortage of workers to harvest one of the state’s delicacies: The blue crab.

Crab fishing is an important part of Maryland’s economy. The crab meat can be eaten in many ways, but is perhaps most well known as the main ingredient in the crab cakes for which the state is famous. Blue crabs are important part of the state economy, providing thousands of jobs for fishermen, restaurant workers, and laborers in processing plants. It is the processing plants that have become a broken link in the chain from ocean to table.

This year many of the processing plants are having trouble finding workers because of President Trump’s tough immigration policy. These workers are not illegal immigrants. Instead, the problem is that there is a critical shortage of visas for legal immigrant workers.

The Wall Street Journal reports that immigration law sets a limit of 66,000 visas, which are normally divided equally between summer and winter work seasons. In the past, Congress worked to ease the shortage by exempting returning workers who went back to the same job that they had held previously. However, for the past two years, the Republican Congress has not passed its usual exemption due to President Trump’s hardline stance on immigration.

This year, employers filed 81,000 visa requests in one day on Jan. 1, more than the total allotment for the year. To respond to the huge demand, the Department of Homeland Security held a lottery for early requestors, but most employers fell far short of the number of visas they needed.

Harry Phillips owns Russell Hall Seafood in Maryland. He bought the company six years ago and looked for American workers to pick the crabmeat from the shells. He got few takers.

“They don’t want an eight-month job like we offer, and that’s all we offer,” Phillips told CNBC. “So that’s a good reason they don’t want to apply for a job here.”

Instead, Phillips and other processors hire foreign workers, often women from Mexico, to work during the crabbing season. The temporary workers are admitted into the country with H-2B visas to work during the crabbing season.

There is demand from other parts of the country for H-2B visas as well. Lawn care workers around the country enter the US on the temporary visas. There are farm workers in the South and California, ski resort workers in Colorado and fishery workers in Alaska. Even President Trump’s Mar-a-Lago resort hires workers on H-2B visas.

Rep. Andy Harris (R-Md.) is attempting to come to the rescue of Maryland’s crabbing industry. The Baltimore Sun reported that the congressman is working to convince DHS to approve another 15,000 visas. The downside is that these visas would be allotted nationwide and may still leave the crabbing industry short.

Gov. Larry Hogan, a Republican, is also asking for federal help. Hogan estimates the shortage is costing the state more than $9 million and destroying 1,000 jobs. A University of Maryland economist estimated that each H-2B visa generates about 2-1/2 local jobs.

About half of crab processing plants are sitting idle for lack of workers, but it isn’t just the plants that are threatened. Without crabs, many Maryland restaurants may go out of business. Without buyers for their catch, fishermen will lose their jobs as well.

“Restaurants are struggling economically, and if you take Maryland crab meat from them, hundreds of restaurants that depend on selling Maryland crab cakes made with Maryland crab meat will go out of business,” said Charlie Gibby of Gibby’s Restaurant in Baltimore.

The laws of supply and demand dictate that a shortage of a product with high demand will cause prices to rise and that is exactly what has happened to crabmeat. The Sun reports that blue crab lump meat is as high as $30 per pound in some stores. When the prices rise to exorbitant levels, fewer people will be able to afford to eat crabmeat … if they can even find it.

Ironically, the crisis is hitting Trump Country the hardest. The Sun notes that although Maryland went for Hillary Clinton, Dorchester County, the home of the crab industry, voted for Trump by a margin of 14 points.

“I voted for Donald Trump and I’d vote for President Trump again,” Morgan Tolley, general manager of one of the crab plants said. “But I think in small rural towns in America, we’re getting the short end of the stick on labor.”

In the end, the crisis was completely avoidable. Supply and demand also addresses the need of businesses for a steady supply of workers. When American workers will not take the jobs, American businesses have the choice of either hiring foreign workers or going out of business. In the case of Maryland’s crab industry, the employers tried to do the right thing and hire legal immigrants, but the government seems bent on making it difficult for them to comply with the law.

The case is similar to that of Obamacare in that business owners understand what it takes to operate their business, but the government is not listening. Business owners knew that Obamacare was too complicated and costly to justify hiring new workers, but the Obama Administration paid them no mind. Now business owners are telling the Trump Administration that they need foreign workers as a source of reliable and affordable labor. Will President Trump listen?

[Photo: Atlantic blue crab at the Children’s Museum of Indianapolis by Wendy Kaveney/Wikimedia]

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