Washington – Immigration, a force that helped build the United States, now divides the country like few other issues.
Enter Steve Kuhn. The wealthy Minnesota native, not long ago a high-profile hedge fund mastermind, has in the past few months plunged into politics for the first time with a proposal for a new kind of work visa intended to greatly increase legal immigration into the country.
Passionate about his plan, Kuhn wants to get it introduced as a bill in Congress. He's had meetings at the Trump White House, talked with dozens of members of the House and Senate, and met with 10 Democratic candidates for president. He launched a nonprofit advocacy group and recently commissioned national polling on immigration. He ramped up his campaign donations, including to Sen. Amy Klobuchar's bid for president. He even moved to Washington part-time.
While armed with a specific goal, Kuhn more broadly aims to drain the divisiveness that characterizes the immigration debate. It's the kind of goal — naive by Washington standards — that only makes sense for someone who previously reached the pinnacle of the financial world.
"No one would rationally say that our efforts are likely to result in changing the U.S. immigration system," said Kuhn, bald-domed with a mischievous grin, during an interview at D.C.'s Capitol Hill Club. "But when the impact is so large, so many millions of people affected — then changing the debate, taking just one step, might be the most effective thing I can do. I've come to the conclusion that it is."
Kuhn, 50, grew up in Columbia Heights. His father was a machinist and carpenter, his mother a teacher and homemaker. Obsessed with board games as a boy, he went on to study game theory at Harvard.
"What could I do in life that's most like playing a game and pays you money to do it? That's Wall Street," Kuhn said on a podcast earlier this year. (He still plays. Meghan Fitzpatrick, executive director of Kuhn's nonprofit Ideal Immigration, said she's seen him best a board game on his first try.)
After college, Kuhn delivered Domino's Pizza before landing a job at Minnesota's Piper Jaffray. Later, at Wall Street's Goldman Sachs, he was part of a team that managed $40 billion worth of mortgage-backed securities.
In 2008, Kuhn joined Minnesota's Pine River Capital, and over five years the firm amassed $15 billion in assets. In 2011, Bloomberg Markets identified a fund managed by Kuhn as the seventh top-performing large hedge fund in the world.
"Pine River profited during the past two years by betting correctly that U.S. homeowners wouldn't pay off their mortgages as fast as they did in 2003, even though mortgage rates fell far and fast during both periods, " the publication said.
Ensuing years saw declines in the mortgage bond market, and Pine River's assets dwindled. Kuhn announced his departure in an April 2016 interview on Bloomberg TV. Behind the scenes, he was locked in a legal dispute with Brian Taylor, the firm's founder, over partnership stakes and a severance package.
The lawsuit was quietly settled several years ago, Kuhn said, with an agreement to jointly donate $5 million to charity.
Kuhn declined to reveal his net worth. The cost of his political foray is coming from his own pocket. "I'm not an unpaid lobbyist, I'm a negatively paid lobbyist," he said.
Kuhn's longtime home base has been Austin, Texas. ("I'm really into live music," he explained.) Divorced with no children, he doesn't have a place in Minnesota but said he's back often to see family. The reigning Texas state mixed-doubles champion in pickleball ("My partner was a huge ringer," he said), Kuhn is looking to open a pickleball bar in the Twin Cities.
A second act
Having achieved career and financial success, Kuhn needed a second act.
"I came to the conclusion about a year ago that there would be nothing I could do to make the world a better place more powerfully and to more effect than helping change our U.S. immigration policy," Kuhn said.
Under his proposal, dubbed the Workforce Visa Act, any foreign national with a valid offer of employment could pay $2,500 to obtain a one-year guest worker visa. That could be renewed annually at the same cost, with the proceeds going to workforce training and development funds for permanent residents in the state where the visa holder lives.
Employers could hire the visa workers if they agreed to pay back the $2,500 as part of their wages. That's meant to defuse criticism that immigrants take jobs from American workers, since the latter could be hired without the additional $2,500 charge.
After a decade, workforce visa holders could achieve legal permanent residence by paying an additional $25,000 or by agreeing to work for another 10 years. Prior to citizenship, the visa holders would not be eligible for public benefits but could join a workplace union.
"This would not eliminate or reduce or supplant any other path to legal status," Kuhn said. "It is an additional path."
Workers and business owners now in the country without legal documentation would be eligible. "We have 11 million here now who are living in fear and avoiding assimilation. The best way to achieve that is to let them know they have a path to live here permanently," Kuhn said.
Kuhn believes a work-focused increase in the legal immigration rate would be an economic boon, helping reduce worker shortages not only in the agriculture, home construction and hospitality industries, but also in specialized fields like technology and medical research.
Kuhn has been working to build partnerships and alliances with business and agricultural groups and with think tanks across the political spectrum.
His proposal does not address border security or immigration enforcement; Kuhn said it's intended to accompany a beefing up of U.S. investment in those areas.
Steven Kopits, a New Jersey-based oil and gas industry consultant who studies the black market for immigrant jobs, said he sees potential in Kuhn's proposal to change the political dialogue around immigration. But he's not sure if $2,500 is a steep enough fee.
"My concern is that's not a lot of money," said Kopits, who has met with Kuhn several times. "Flooding the country with low-end labor with that kind of system is going to be a hard sell on the right without some kind of cap."
Kuhn sees an unlikely potential ally on his bid to boost legal immigration: President Donald Trump, who critics see as a demagogue on the issue.
"I think it's a little bit more nuanced than some people would acknowledge," Kuhn said. He can cite eight separate times, including the most recent State of the Union and a speech at the Conservative Political Action Committee conference, in which Trump called for an increase in legal immigration. "I can remember it almost verbatim," Kuhn said.
In recent months, Kuhn met with more than 90 members of Congress. He's been to the White House three times, discussing immigration with Vice President Mike Pence and Trump adviser and son-in-law Jared Kushner.
He said he saw echoes of his plan in a recent immigration proposal spearheaded by Kushner (the White House press office did not comment when contacted by the Star Tribune). He met with former Vice President Joe Biden and Klobuchar, among other Democratic contenders. He's looking for someone in Congress to introduce the Workforce Visa Act.
"What I've said to him is the problem right now is any reasonable proposal issued by the left, any reasonable proposal that might be issued by the right, will be met with comprehensive resistance. Not because of contents, but because of politics," said U.S. Rep. Dean Phillips, a Minnesota Democrat.
Phillips is a member of the House Problem Solvers Caucus, 22 Democrats and 22 Republicans who work for bipartisan solutions to major debates. Kuhn hopes to enlist the group, and Phillips said he sees potential: "If we can plant the seeds of what they're proposing ... it can spring from the middle and mushroom outwards."
Patrick Condon • 202-662-7452