Immigration and Competitiveness

Back in June, I blogged about immigration as it affects student entrepreneurs at Georgia Tech. Apparently that qualified me as an expert on immigration policy! Someone at the U.S. Chamber of Commerce noticed what I’d written and invited me to a forum in Washington yesterday on “Immigration and American Competitiveness.”

It gave me a chance to meet Michael Bloomberg, and I strongly recommend that you take the time to listen to his keynote, which is archived on C-SPAN here. He made my points far better than I could have!

But I also enjoyed the panel discussion which followed. If you’re inclined, you can watch the whole thing here. My bit starts at 43:20, and I chime in again around 1:27:10. Since I had my notes on my iPad, I was able to update them in realtime at the event; that text is below.

(FYI, using Pages on the iPad with 40-point Helvetica makes a great personal teleprompter!)

Thanks for inviting me here. I appreciate the opportunity.

I could probably replace my prepared remarks with “What Mike said.” His Honor did a great job.

Although I’m not an academic, I think my role today is to discuss immigration from the point of view of a major research university. And I’d like to follow that with some of the issues with current immigration policies that affect what our students can do AFTER graduation.

For those of you who aren’t familiar with Georgia Tech, we’re the largest engineering school in the United States. But we’re not just big; some folks think we’re pretty good.

U.S. News ranks us as the 4th best engineering school in the U.S. — when the top three are MIT, Stanford, and Cal Berkeley, #4 isn’t a bad place to be.

They rank us as the 7th best public university of all types.

And we’re not just good at one thing. They rank twelve types of engineering degrees — electrical, mechanical, civil, etc. We rank in the Top Ten for eleven of them, and we don’t offer the twelfth.

We’re in Atlanta. As you might expect, since the civil rights era, we have a strong history of graduating minorities. Whether you’re measuring Bachelor’s, Master’s, or Ph.D.’s, we’re Top Ten for African-Americans, for Asian-Americans, and for Hispanics, and for minorities overall.

And we have a lot of foreign students.

Right now, about 7% of our undergraduates and 40% of our graduate students are on foreign visas.

Forty percent. As Tom pointed out, the national average for STEM graduate students is actually over 50%. And as Robin pointed out it’s north of 60% in computer science.

At Georgia Tech, the bulk of our foreign students come from, unsurprisingly, India, China, and Korea. But, overall, they come from 115 countries. –I don’t think I could name 115 countries!– Overall, between graduate and undergraduate, that’s 18% of our total enrollment, or about 3800 out of 21,000 students.

It’s hard to get into Georgia Tech. We get six applications for every slot in our freshman class, so you know that we’re pretty picky about who we let in. The 3800 foreign students on our campus are the best of the best. Smart, hard-working, flexible… you couldn’t ask for better students. Or better employees. Or better CITIZENS.

But the United States has put up barriers to letting these students build their careers in America. Just getting their student visas approved — not even talking yet about permanent residency! — is a bureaucratic nightmare. It discourages many of them to just give up, and study in other countries.

It didn’t used to be that way. A hundred years ago, the United States had, at best, a second-tier set of colleges and universities. Harvard was pretty good, but things fell off pretty rapidly from there. But, by 1950, we had unquestionably the finest higher education system in the world. We still have it today, although the rest of the world is trying hard to catch up.

What happened? IMMIGRATION. Our university system in this country was BUILT on immigration.

Specifically, Hitler came to power in 1933 and destroyed the German university system, which at that time was the finest in the world. Many of those professors, and even students, escaped to Britain and the United States. That won the war. Imagine the Manhattan Project without Jewish scientists. Imagine if they’d stayed in Germany.

After World War II, Europe was wrecked, and even MORE came to the United States from all over the Continent.

And then from Latin America, and from Asia… We imported the best brains from all over the world into our colleges and universities. And that led to a half-century of unchallenged economic dominance.

A couple of months ago, I was at a Georgia Tech student event, the Convergence Innovation Competition. I was INCREDIBLY impressed by the quality of the student entrepreneurs. They were mostly Master’s candidates in Computing or Electrical Engineering. And they were demonstrating apps for iPhones and Androids and even your television that were commercial-grade, or could get there.

I spent about a decade as a venture capitalist, and I was IMPRESSED. This was a class project, but it felt like a venture capital event. I started asking them, “Do you want to start a company around this?” I’ve still got friends in the venture business, and I think I could get some of these teams funded!

But the answer was usually a smile, and a quiet “No, I can’t.” So then I figured it out, and I started asking them: “Where are you from?”

Of 28 competitors, 26 were from overseas.

There’s no way that these 26 students can graduate from Georgia Tech and take what they’ve learned here and start companies in the United States.

They want to, but they can’t.

If you can only remember one thing I’ve said this morning, please remember that. We’re educating these children, they want to start companies here, and we’re telling them to go home.

They want to stay, but they can’t.

Removing the caps on H1-Bs wouldn’t help them. Our immigration service doesn’t recognize self-employment. And the kids couldn’t afford the fees, anyhow. So, they can find a big-company employer who is able to invest $20,000 or $30,000 in getting them an H1-B and eventually a green card. Or, they can go home. And, as Elizabeth pointed out, their economies are thriving back home, so it’s more than likely that they’ll compete with us from there!

Now, entrepreneurship is HARD. Most people who try it, fail. I think the willingness to pack your bags and move to a different country for graduate school is a pretty good filter for whether a young person has what it takes to start a successful company. And the data supports that. Over HALF of the startups in Silicon Valley have a founder from India or China.

And, remember, as the Mayor mentioned, the Kauffman Foundation found that young companies have accounted for essentially ALL the job growth in the United States over the last twenty-five years. But our immigration policy doesn’t encourage foreign graduate students to participate in that job creation. Work for a big company, or go home.

Just at Georgia Tech, we’ve seen the impact of this over and over again. One of our spinout companies, Whisper Communications, was based on work from a graduate student in electrical engineering. He jumped through all the immigration hoops possible, but eventually exhausted his options. He gave up.

He was immediately snapped up by Apple, where I figure he’s building the iPhone 6, but it delayed the formation and growth of that company by over a year. We had to bring in new founders without immigration problems.

Who knows what could have happened in that year? And I’m sure our former student is contributing economic value working for Apple, but nothing like what he could be doing in a startup.

John Doerr, one of the most successful venture capitalists in history, said “I would staple a green card to the diploma of anyone that graduates with an advanced degree in the physical sciences or engineering in the United States.” He’s absolutely right.

These people are going to create value. Create jobs. Pay taxes, for crying out loud! Why would we NOT want them to stay here? Get married, raise families, buy a house, buy 2.3 cars… the multipliers are endless.

Now, what I always hear when I speak on this subject is that “immigrants take jobs from Americans.” The Mayor already addressed this. That’s just not true for entrepreneurial immigrants! They don’t TAKE jobs, they MAKE jobs!

First for themselves, then for co-founders, and eventually—if successful—for hundreds, or, thousands of employees.

This is NOT a zero-sum game. If these immigrants aren’t allowed to create jobs, those jobs WILL NOT go to native-born Americans… those jobs simply won’t exist.

And these aren’t jobs flipping burgers or picking crops. These are high-quality high-paying jobs that your kids would like to have someday. Example: There are two million “Internet jobs” in the United States. None of those jobs existed twenty years ago. Most of the COMPANIES didn’t exist twenty years ago. Now, subtract all of those Silicon Valley companies who were founded by immigrants. It’s a pretty ugly picture.

And although Silicon Valley gets all the press, it’s deeper than that. As a bit of history, not just Google and Intel, but Pfizer, DuPont, U.S. Steel, and Procter & Gamble were once startups founded by immigrants.

Earlier, Alejandro repeated the cliché that “we are a nation of immigrants.” It’s a cliché, but it’s also true. We still have the world’s best graduate schools; other countries are catching up, but we started from far ahead.

Moreover… We have a history of risk-taking, of capital fluidity, and of tolerance of failure that has made the U.S. the best place in the world to start a company. Other countries are catching up here, too, but our culture and history give us an edge. Even with our current financial troubles, I believe that we’re still the entrepreneurial Mecca for the world.

But we have to make sure that we attract the best, brightest, and most innovative entrepreneurs, whether they were born here or not.

In honor of the Mayor, i made up a baseball analogy, but he beat me to it. Building fences to keep out brainpower is like saying that “My baseball team has enough talent, let the other teams get some good players, too.” That’s not how the Yankees play the game, and it’s not how the United States should play the game.

With that, I’ll pass the microphone and look forward to the rest of the panel. Thank you.

Comments

  1. Stop shilling for NASSCOM, you collaborator. Those college spots should go to Americans, vets, or locals who have paid their taxes and their dues, not upper-caste misogynists looking to exploit their brethren and continue the ethnic cleansing of Americans in high-tech.

    STFU, traitor.

    • Never heard of NASSCOM until your comment. Always good to learn new things.

    • mikeschinkel says:

      Wow. Stephen is both one of the smartest and most patriotic people I know, and I know him well after my 3.5 years of running the Atlanta Web Entrepreneur meetup group from 2007-2010 which his ATDC organization hosted my events. If you want to see evidence, here are the 86 reviews my group received over those years: http://www.meetup.com/atlantawebmarketers/about/comments/?op=all

      For you to call Stephen those names tells me you have absolutely no idea who Stephen is and what he stands for. You also clearly have no idea what it takes to make American competitive. There are too many people who have been too successful who are saying this is what we need to do, for example: http://www.forbes.com/sites/nickschulz/2011/10/04/yes-there-is-such-thing-as-a-free-lunch-its-called-immigration/

      If you have your way then the USA will soon subservient to China and we will join London, Amsterdam, Rome, Athens and Jerusalem as one that used to lead the world.

      What about your life makes you so intensely upset at the world? There’s always somebody who hates themselves so much the only way they know how to cope is to blame everyone else. Clearly by the rants on your blog post you fit into that category.

  2. Dolores says:

    Such people are traitors. How will it help America to rob sick and suffering foreign countries of their badly needed brainpower, while at the same time shutting ours out of good colleges and eventually flushing their lives down the john? Americans were once immigrants, and didn’t become stupid by living here a few generations. This is pure, ugly, discrimination against American students, as vile as anything that is denounced in diversity programs. If I had dictitorial powers, I would send people who feel this way about foreign vs. American students to India on a one-way passport.

    • mikeschinkel says:

      @Dolores – It’s a good thing you don’t have dictatorial powers because if you did you could single handedly destroy our economy with your fact-less emotion-driven agenda.You are off in a vacuum venting without any facts.

      The foreign students Stephen speaks on at Georgia Tech are working hand-in-hand with American born students, and as I’m heavily involved with the entrepreneurial students at Georgia Tech, I don’t know a one who laments these foreign students. Instead, they want to partner with them to form innovative businesses of tomorrow.

      If you really want to understand instead of just vent your frustrations, start by reading about innovative vs. replicative business:

      http://knowledge.wpcarey.asu.edu/article.cfm?articleid=1275
      http://knowledge.wpcarey.asu.edu/article.cfm?articleid=1299

      Then read about how The Kaufman Foundation that focuses on entrepreneurship found that almost all job growth comes from innovative startups:

      http://www.kauffman.org/newsroom/u-s-job-growth-driven-entirely-by-startups.aspx

      Who is the Kaufman Foundation? A non-partisan and non-profit focused on advancing entrepreneurship:

      http://www.kauffman.org/about-foundation/our-credo.aspx

      How about being part of the solution and not part of the problem?

      • Destroy the US economy? It’s already been destroyed – 13 years of importing people who have never seen a lightswitch by the millions has ruined us. 13 years ago when Americans were in these jobs the US economy was booming. And there are millions of very angry young graduates who cant find jobs and they know it’s because of the foreign workers. Stop your veiled communist lies. We all know these foreign workers come here to “partner” with Americans in order to learn from us and return home with the skills – not to help us. Look around you at the economic disaster we are in – I don’t know what little academic bubble you are living in but you are delusional.

      • What job growth? The US has lost 28 million jobs since 1998 – the same year we opened our doors to the flood of foreign labor.

      • If you want to see what foreign workers are really doing to Americans – namely deliberately keeping us out of the workforce, just take a look at this internal email from Sun – where both Indians and Chinese gang up on Americans and keep them out of jobs. Note the names of the two email groups this was sent to:

        ——– Original Message ——–

        Subject: Sr. Electrical Engineer Position available @ Oplink
        Date: Mon, 13 Oct 2003 10:40:35 -0700 (PDT)
        From: Julie Koo
        Reply-To: Julie Koo MOC.nuSnull@ooK.eiluJ

        ————- Begin Forwarded Message ————-

        Date: Mon, 13 Oct 2003 08:43:52 -0700
        From: Sabrina Chan
        Subject: Sr. Electrical Engineer Position available @ Oplink
        To: moc.nusnull@0002nwotanihc, moc.nusnull@ac_snaidni
        MIME-version: 1.0 X-Accept-Language: en
        Original-recipient: rfc822;moc.nusnull@0002nwotanihc

        Hi, The company my friend works at is currently looking for a Senior Electrical Engineer. If you know any qualified applicants, please have them send their resume directly to: moc.knilponull@lanirt. Attached below is a copy of the job description. Oplink is a telecommunications company.

        Thanks”

        So there you have it: chinatown2000 and moc.nusnull@ac_snaidni no racism going on there, right? No deliberately excluding white Americans going on there. This is happening in our compnaies by the MILLIONS in the USA. Jealous foreign workers are keeping Americans out of work. That is what is really going on.

      • Why don’t you take a good look at the first comment by “indian” on this blog to see the real intent of these people:

        http://tinyurl.com/42wewg3

        Everyone is our friend now, no one wants to hurt us, all people in the world are good, loving people. Right? WRONG!

        You had better wake up to reality – we are facing incredible dangers and you are helping to enable those who seek to destroy us.

  3. Wakjob says:

    We all know you’re being paid by NASSCOM/Wipro/InfoSys to push this garbage. 13 years of importing these people has wrecked our economy. They do not like America, they do not want to settle here, they do not want to buy our products – they want to come here to get educated and and earn $ here to send home and that is all. We need to stop educating our enemies and competitors – we need to educate our OWN people, and keep our smarts, skills, and knowledge in OUR country. Stop helping our competitors!

    • mikeschinkel says:

      @Wakjob – I’ve known Stephen personally for years, and I know he absolutely no relationship with NASSCOM, Wipro or InfoSys; he doesn’t need to, he runs the Enterprise Innovation Institute for Ga Tech which includes GTRI a group that has huge contracts with the US military.

      The foreign born he *does* have relationships with are the incredibly intelligent and capable professors and students at Georgia Tech (of which I am an alumni.) Stephen is also probably the smartest person I personally know and when Stephen is impressed with people, so should we all be.

      Stephen is heavily involved in the local Atlanta startup community which include innovative companies that hire lots of people as they grow (one past example: Internet Security Systems.) Unfortunately there are a lot fewer founders of such companies and thus fewer companies hiring because of our immigration laws.

      Something to consider: A person who sees enemies around every corner is focused not on what it takes for their future success but instead on their own past failures. A wise man once said “How do you know you’ve won the battle? Those who were formerly your enemies are now your friends.” Maybe a bit of introspection is in order?

      • Appeal to authority is one of the prime logical fallacies. Have you ever taken formal logic? Just because an “expert” says something we shouldn’t blindly believe them. Experts are often wrong. And throwing around titles and “professor” doesn’t give one credibility. I am sure you have heard the saying “Those who can, do. Those who can’t teach”. Many a failed tech executive has gone into academia because they couldn’t make it in the real world (Vivek Wadhwa, for example). And just because you don’t know someone has a releationship with NASSCOM doesn’t mean they don’t have one.

        Steven is the smartest person you know? What has he accomplished? Did he invent anti-spam software like I did? Did he write software for Apple and PlayStation at Sony like I did? I doubt he has even one real accomplishment to his credit. It’s wannabe fakers like you people who are wrecking this economy. Can you name one Atlanta startup Steve has been involved in that has grown to any size that anyone outside of Atlanta has heard of? Almost no one has ever heard of Internet Security Systems. How did Amercia’s startups of the past ever make it without mass immigration before? Answer: they used Americans, not foreign workers. The 90s were booming long before foreign guest workers got here. BusinessWeek ran a cover story last year about how innovation has been dead for a decade. The same decade we have been importing millions of foreign workers and throwing Americans out of work. Sorry, but facts just don’t agree with your assertions.

        Those who do not learn from history are doomed to repeat it: in the 1930′s America’s businessmen thought they could safely sell our scrap steel to Japan. England’s Rolls Royce sold aircraft engines and factories to Hitler. We all know how those actions turned out: World War. It’s happening again. China and India are not our friends. Both countries harbor centuries-old resentments against the west. And both are planning to attack us. I suggest you google “War is not far from us and is the midwife of the Chinese century”. Wake up you fool, before you get us all killed.

  4. Wakjob says:

    Companies ruined or almost ruined by imported Indian labor

    Adaptec – Indian CEO Subramanian Sundaresh fired.
    AIG (signed outsourcing deal in 2007 in Europe with Accenture Indian frauds, collapsed in 2009)
    AirBus (Qantas plane plunged 650 feet injuring passengers when its computer system written by India disengaged the auto-pilot).
    Apple – R&D CLOSED in India in 2006.
    Australia’s National Australia Bank (Outsourced jobs to India in 2007, nationwide ATM and account failure in late 2010).
    Bell Labs (Arun Netravalli took over, closed, turned into a shopping mall)
    Boeing Dreamliner ES software (written by HCL, banned by FAA)
    Bristol-Myers-Squibb (Trade Secrets and documents stolen in U.S. by Indian national guest worker)
    Caymas – Startup run by Indian CEO, French director of dev, Chinese tech lead. Closed after 5 years of sucking VC out of America.
    Caterpillar misses earnings a mere 4 months after outsourcing to India, Inc.
    Circuit City – Outsourced all IT to Indian-run IBM and went bankrupt shortly thereafter.
    ComAir crew system run by 100% Indian IT workers caused the 12/25/05 U.S. airport shutdown when they used a short int instead of a long int
    Computer Associates – Former CEO Sanjay Kumar, an Indian national, sentenced to 12 years in federal prison for accounting fraud.
    Deloitte – 2010 – this Indian-packed consulting company is being sued under RICO fraud charges by Marin Country, California for a failed solution.
    Dell – call center (closed in India)
    Delta call centers (closed in India)
    Fannie Mae – Hired large numbers of Indians, had to be bailed out. Indian logic bomb creator found guilty and sent to prison.
    GM – Was booming in 2006, signed $300 million outsourcing deal with Wipro that same year, went bankrupt 3 years later
    HP – Got out of the PC hardware business in 2011 and can’t compete with Apple’s tablets. HP was taken over by Indians and Chinese in 2001. So much for ‘Asian’ talent!
    HSBC ATMs (software taken over by Indians, failed in 2006)
    Intel Whitefield processor project (cancelled, Indian staff canned)
    JetStar Airways computer failure brings down Christchurch airport on 9/17/11. JetStar is owned by Quantas – which is know to have outsourced to India, Inc.
    Lehman (Spectramind software bought by Wipro, ruined, trashed by Indian programmers)
    Medicare – Defrauded by Indian national doctor Arun Sharma & wife in the U.S.
    Microsoft – Employs over 35,000 H-1Bs. Stock used to be $100. Today it’s lucky to be over $25. Not to mention that Vista thing.
    MIT Media Lab Asia (canceled)
    MyNines – A startup founded and run by Indian national Apar Kothari went belly up after throwing millions of America’s VC $ down the drain.
    PeopleSoft (Taken over by Indians in 2000, collapsed).
    PepsiCo – Slides from #1 to #3 during Indian CEO Indra Nooyi’ watch.
    Polycom – Former senior executive Sunil Bhalla charged with insider trading.
    Qantas – See AirBus above
    Quark (Alukah Kamar CEO, fired, lost 60% of its customers to Adobe because Indian-written QuarkExpress 6 was a failure)
    Rolls Royce (Sent aircraft engine work to India in 2006, engines delayed for Boeing 787, and failed on at least 2 Quantas planes in 2010, cost Rolls $500m).
    SAP – Same as Deloitte above in 2010.
    Singapore airlines (IT functions taken over in 2009 by TCS, website trashed in August, 2011)
    Skype (Madhu Yarlagadda fired)
    State of Indiana $867 million FAILED IBM project, IBM being sued
    State of Texas failed IBM project.
    Sun Micro (Taken over by Indian and Chinese workers in 2001, collapsed, had to be sold off to Oracle).
    UK’s NHS outsourced numerous jobs including health records to India in mid-2000 resulting in $26 billion over budget.
    Union Bank of California – Cancelled Finacle project run by India’s InfoSys in 2011.
    United – call center (closed in India)
    Victorian Order of Nurses, Canada (Payroll system screwed up by SAP/IBM in mid-2011)
    Virgin Atlantic (software written in India caused cloud IT failure)
    World Bank (Indian fraudsters BANNED for 3 years because they stole data).

    I could post the whole list here but I don’t want to crash any servers.

  5. Wakjob says:

    ALL foreign workers who work in the US while Americans are unemployed are ILLEGAL. Learn some laws.

    TITLE 8 > CHAPTER 12 > SUBCHAPTER II > Part II > § 1182?§ 1182. Inadmissible aliens??(a) Classes of aliens ineligible for visas or admission?Except as otherwise provided in this chapter, aliens who are inadmissible under the following paragraphs are ineligible to receive visas and ineligible to be admitted to the United States: ??…??(D) Immigrant membership in totalitarian party?(i) In general Any immigrant who is or has been a member of or affiliated with the Communist or any other totalitarian party (or subdivision or affiliate thereof), domestic or foreign, is inadmissible. ??…??(5) Labor certification and qualifications for certain immigrants?(A) Labor certification?(i) In general Any alien who seeks to enter the United States for the purpose of performing skilled or unskilled labor is inadmissible, unless the Secretary of Labor has determined and certified to the Secretary of State and the Attorney General that—?(I) there are not sufficient workers who are able, willing, qualified (or equally qualified in the case of an alien described in clause (ii)) and available at the time of application for a visa and admission to the United States and at the place where the alien is to perform such skilled or unskilled labor, and?(II) *** the employment of such alien will not adversely affect the wages and working conditions of workers in the United States similarly employed. ***

  6. Wakjob says:

    Every immigration wave to the U.S. since 1900 has led to recession or depression. The late 1998-2000 wave was the biggest in U.S. history – bigger than the one from 1906-1920. Historical facts do not lie. Here is the history of immigration and recession to America since 1900:

    1906-1920 – Huge wave from Europe – Great Depression in 1929.

    1965 – Ted Kennedy’s Immigration Reform Act – Big recession 1973-1981

    1990 – H-1B started – recession 1991-1993

    Oct. 1998 – H-1B caps raised form 65,000 to 115,000 per year – collapse in 2001.

    Apri 2000 – H-1B caps raised from 115,000 per year to 195,000 per year – collapse in 2008.

    The fake “recovery” in the mid 2000′s was no recovery – just cheap Fed credit making up for Americans losing their jobs.

    America was built by Americans. Every buildup leads to immigrant takers who come in when times are good, strip the economy, then leave when times are bad – as they are now.

    84% of the current U.S. population was born here. Do you seriously expect us to believe that 84% of the natives live off the work of the other 16% immigrants? Come on, stop being either a liar or delusional. Immigration is a disaster for America.

    China and India don’t have open borders. Did I mention they are booming.

    Free Trade caused WW2 – America in the 1920s sold its scrap steel to Japan and England’s Rolls Royce sold aircraft engines and factories to Hitler. We all know how that turned out.

  7. Okay, comments are getting pretty heated. I’m allowing most through, but any obscenity or references to the Holocaust are getting you rejected.

    And please keep in mind: I’m talking about students who want to create companies. Outsourcing to India obviously has ‘wakjob’ upset (moc.oohaynull@0102_ikibih, 68.104.224.37), but that’s a different topic.

    • Supressing evidence is not a valid method of argumentation. In fact, it’s usually a sign that yku’ve lost. The reality is a new Nazism is rising in Asia. Just because you don’t want to face it doesn’t mean it doesn’t exist. Why are you a Holocaust denier? And publishing someone’s email address and IP is a sort of personal attack, not a valid argument response. I would have expected a little more intellectual integrity out of a supposedly lofty professor at GT, but apparently you can’t even pull that off. Which just further shows you have no credibility.

  8. Stephen, what’s bugging these folks and what causes your main argument for ‘foreign entrepreneurs’ to fall flat– can be epitomized in this one blog entry. By a ‘foreign entrepreneur:

    http://praneethpatlola.posterous.com/h1b-entrepreneurship

    All the so-called ‘multipliers’ that you mention will be trumped by dominant culture & behaviors that have existed for 1000s of years. What’s been happening with the H1B will happen with any ‘StartUp VISA’ …more wealth channeled out of the country anyway. In fact this argument (furthered by Vivek Wadhwa among other cheap labor shills) is just a re-branding of the H1B.

    Your ‘entrepreneurs’ will fail, and with US college debt join the US labor market. They *will* end up taking benefits, most likely with no job to pay taxes.

    Take this from someone who has lived and worked overseas: Your ‘screening process’ is too simplistic, and NO OTHER country (least of all, China & India) use it. Also, Apple’s ‘screening process’ isn’t as simple as your example would seem to portray them.

    You also seem to think that if you add ‘hyphen American’ then these folks will stay. Some may, most will not. In fact, most will send wealth OUT of this country. I guess that’s okay as long as the Fed keeps printing wealth, right?

    Finally, ‘Kevin Flanagan’ has a point. Those slots should, AT THE VERY LEAST go to veterans: our most disciplined, resourceful, and loyal to this very country- folks. Citizens FIRST. All others second. That formula has always worked, in every country that has a democracy.

    -Drunken Economist
    http://mindtaker.blogspot.com/
    http://twitter.com/drunk_economist

    • mikeschinkel says:

      @Druken Economist:

      How does that “foreign entrepreneur’s” badly written story prove anyone’s point? This guy also posts “I barely graduated my Bachelors Degree in CS…”:

      http://praneethpatlola.posterous.com/venture-1-entreprenuership-in-college

      He is NOT the type of student Stephen speaks about.

      And where are your statistics showing that wealth will be channeled out of this country by foreign entrepreneurs that start innovative companies that employ American born citizens?

      So you think these masters and PhD graduates of universities like Ga Tech will fail? CLEARY you have not met them. I am a Ga Tech alumni from 88 and I have met many of them and they impress the HELL out of me; everyone one of them that I have met, no exceptions. These guys are NOT going to be a drain on our country; they will be your future employer is we just give them the chance.

      Why do some of the most savvy venture capitalists, the ones who invest our pension funds in US-based startups believe so strongly in a Startup Visa?

      http://www.feld.com/wp/archives/2009/09/the-founders-visa-movement.html
      http://www.avc.com/a_vc/2010/04/immigration-reform-and-the-jobs-bill.html
      http://www.bothsidesofthetable.com/2010/04/04/twtfelipes-story-a-tale-of-us-visa-policy-gone-awry/

      Skilled immigrants made this country great, why do you think it makes no sense to repeat those past successes?

      What veterans do you speak of? People from other countries who fought for our military? OF COURSE they should get citizenship if for no other reason than to say “THANK YOU FOR YOUR SUPPORT.”

      But there’s no reason we should NOT give skilled immigrants citizenship just because we give veterans citizenship; what common sense would that make? Also, in my experience *most* veterans build replicative businesses vs. innovative businesses because in large part their military service conditioned to follow orders, not to think innovatively (unless they became higher level officers.) And these links explain why replicative businesses can only help us so much:

      - http://knowledge.wpcarey.asu.edu/article.cfm?articleid=1275
      - http://knowledge.wpcarey.asu.edu/article.cfm?articleid=1299
      - http://www.kauffman.org/newsroom/u-s-job-growth-driven-entirely-by-startups.aspx

      Anyway, I’ve said my piece and it’s all the time I can devote to this. If I’ve made a positive impression, good. If not, so be it. Whatever the case, I have a business to run so I can add to the economy and hopefully be able to hire some more Americans as it grows…

      • “So you think these masters and PhD graduates of universities like Ga Tech will fail?”

        Yes, I do. Let’s give some concrete examples of how you are so wrong. As I lived and worked in Silicon Valley for 16 years writing software I think I am more than qualified to speak on the subject.

        In 1998 I was called in by a colleage to clean up a huge software disaster on a then-flagship Mac product. The product was so bad that the company was losing customers. The CEO begged me to come in and clean it up. The tech lead at the time has a Masters in CS from Toronto University yet he couldn’t ship a product that worked. He was brilliant and knew everything there was to know about CS, yet he couldn’t do the job. I on the other hand came in and cleaned it up in 7 months to rave reviews and the highest rating:

        http://www.allbusiness.com/company-activities-management/management-benchmarking/6640943-1.html

        One more company almost driven into the ground by foreign workers.

        In 2005 I worked at a small VC-funded startup called Caymas. I was the ONLY American in the development department. The founder and CEO was Indian. The director was French and had a Masters in CS from Carneigie Mellon U, the tech lead was from China. ALL the other devs were from Asia – I was the only American. The company was not profitable and was entirely VC funded. They were all getting paid off of investment $ – not from producing and selling something people wanted. The woman programmer who sat in the cubicle next to me was from Taiwan. She had a Masters in CS from US Berkeley. I would routinely smile as I heard her hurl her cell phone against her cubilce wall while shouting obscenities because she could’t get her code to work.

        Needless to say Caymas went under a few years later – after sucking 5 years’ worth of America’s VC money out and all the foreign workers sending it back to their home countries: India, China, France, Viet Nam, Taiwan, you name it. That’s ALL American capital being thrown down a rathole while producing nothing. We get poorer, they get our $ and some experience, and that many more Americans are kept out of the workforce.

        Those are just 2 personal examples but there are many more like them. The fact is, foreign workers are simply not as good as Americans and they come here to take out $ and send it home, not to create jobs here.

        Skilled immigrants did not make this country great, Americans did. Can you name the great accomplishments of skilled immigrants that made this country great? We have been repeating the same ‘successes’ for the past 13 years and it’s not working – our economy is a wreck. We need to go back to what WAS working in the 90s – putting American tech workers back to work and deporting the foreign grifters who obviously cannot produce economic prosperity.

        “But there’s no reason we should NOT give skilled immigrants citizenship just because we give veterans citizenship; what common sense would that make?”

        The sense it would make is that when Americans work here they spend their $ here, helping our economy. When foreign workers come here and work, they send their $ home, rather than spending it here. $50,000 is a king’s ransom in India. If you’re a 25-year old Indian male in India and you hear of an American making $100,000 in the USA, the first thing that goes through your mind is that if you had $100,000 USD in India, you could retire right now and never have to work again in your life. So they want to come here, work for a few years, take all that $ home and live like a king. Why would they want to come here make relatively little and then spend it on overpriced housing and cars? Life is much better in India – if you have $100,000 USD.

        You people need to wake up to the delusion that not everyone in the world wants to be American. America has become something of a joke around the world. These people don’t want to become Americans they want to come here to rob us and go home to build THEIR countries. You need to wake up to reality instead of hiding in youe little out-of touch academic bubble.

  9. joshua says:

    I have an engineering degree from Cornell, in 2009 after 15 years of
    loyal service to my company, I was forced to train my H-1B indian replacement and then got laid-off.
    I had a second job later for several weeks, but was again laid-off so the
    company could replace me with another H-1B indian with no experience
    so he could take the job right back to India.

    I have been unemployed ever since, almost 2.5 years now.

    The fact is, that the current H-1B system is being used to replace
    Americans and nothing more. It needs to end. I have no problem
    with ending all H-1B/L1/B1/OPT/CPT visas, and *replacing* them
    with a new visa (let’s call it maybe, E1) that requires any entrepreneur immigrant who wants a chance to create a company and hire Americans (all of which must be proven/overseen to prevent similar h1b fraud) and then, yes, we can staple a greencard to their head as far as I’m concerned.
    But right now, the H-1B/L1/B1/OPT/CPT are 99% or more being
    used to replace and export Americans and American jobs with
    foreign immigrant slaves with average/ordinary skills (simple programming or software testing or basic IT) who undercut American salaries 30/40%. EVERYone knows, there are thousands of H-1B benching bodyshops/jobshops right here even in NJ, and you can search through sulekha.com where they boldy and blatantly advertise right in the face of everyone.

    • Funny about that training thing – these supposedly skilled immigrants come here, many of whom have never seen a lightswitch and WE have to train them to do jobs WE can already do great. Then they take the jobs and can’t do them, the companies all collapse and they get paid to collapse them, then we wonder why there’s a jobs problem. These people are not skilled. This is just a new form of communism – taking from the productive nations and giving to the unproductive ones. People like Flemming and Schinkel have just been co-opted by the globalists or the cheap labor lobby to believe that it is America’s job to train the world and give everyone a job. Globalization is just a new form of communism – from each according to his abilities (Americans) to each according to his needs (3rd worlders who have no skills and who come here to get trained by us).

  10. Dolores says:

    It’s true that the energetic foreign students start a lot of companies, but the vast majority don’t employ any significant number of Americans, except possibly as window-dressing. Usually, foreign-started companies are used as landing pads to sponsor and import more foreigners, not to hire Americans. I predict with confidence that this trend will continue as long as our laws and loopholes allow for it.

  11. Okay, wakjob, I’ve given you plenty of room to post your opinions here. You have some unfortunate anecdotes, and I sympathize for the troubles you have experienced with your career.

    But the plural of anecdote is not data. For some real data on the issue, I encourage those who are not blinded by emotion to read Stuart Anderson’s report at

    http://www.nfap.com/pdf/KEEPING_TALENT_IN_AMERICA_NFAP_October_2011.pdf

    And with that, I will stop approving repetitive comments that don’t add to the discussion. If anyone has a new viewpoint or something substantive other than calling me “traitor” (or worse; I’ve been filtering out the obscenities), please post it. Thanks.

  12. joshua says:

    Ron Hira Provides Answers to Senator Grassley that Strengthen His Testimony Refuting Shortage Claims

    During the Senate subcommittee hearing on high-skilled immigration reported in this month’s “Taken for Granted” column, Senator Chuck Grassley (R-Iowa) asked witness Ron Hira, professor of public policy at Rochester Institute of Technology in New York, to explain in writing for the record why his testimony differed from that of the other witnesses, especially Microsoft’s general council Brad Smith. Smith had argued that the United States suffers a shortage of technical talent. Hira denied that claim, stating instead that the current unemployment rate among holders of STEM (science, technology, engineering, and mathematics) degrees is unusually high.

    Hira now has made available to Science Careers the 8-page written reply that he sent to Grassley, which considerably strengthens his testimony at the hearing. Smith’s argument, Hira wrote, depends on his assumption that economic “full-employment occurs with an unemployment rate of 5%.” Since college graduates currently have an unemployment rate of 4.4%, Smith “concludes that there’s a shortage” of such workers.

    In reality, however, data from the past two decades indicate that “the unemployment rate for college graduates when the enconomy is at full-employment is approximately 2.2%, or half what it is currently,” Hira writes. “Typically, the national unemployment rate is slightly more than twice the unemployment rate for college graduates, whether the country is in recession or in recovery.” During the 2 years before the Great Recession began in 2008, “when the economy was doing well, the national unemployment rates were 4.6%, whereas the rates for college graduates were 2.0%.” This indicates an unemployment rate during full employment of “approximately 2.2%” for college graduates, and therefore that a “jobs recession” for degree holders currently exists, Hira concludes. At present, “there are too many skilled workers chasing too few jobs.”

    Focusing specifically on computer and mathematical occupations, “a field where Mr. Smith argues there’s a shortage of workers,” Hira also finds “unemployment rates…much higher than we would expect at full-employment.” These two fields, which constitute “the largest of all STEM occupations,” suffered “unemployment rates of 5.2% in 2009 and 2010,…more than twice the levels at full-employment” based on historical data. In fact, in 2010, the unemployment rate for computer and mathematical workers exceeded that of all college graduates by half a percentage point. The unemployment rates for electrical and electronic engineers and for medical scientists in 2010 were 5.4% and 4.1%, respectively, Hira writes. Again, he finds that, instead of any “broad-based shortage” in these fields, “there are too few jobs for those skilled workers.”

    After laying off 5,000 workers in 2009, Hira goes on, Microsoft has “an offer-acceptance rate [of] 93%, meaning that 93% of job applicants who were offered a position accepted it. A rate this high would indicate that Microsoft is experiencing little competition in attracting job candidates,” he states.

    Hira next turned his attention to the claim advanced by Bob Greifeld of the NASDAQ OMX Group that each H-1B worker results in five additional new jobs. This oft-cited figure, Hira notes, comes from a 2008 study that is widely recognized among experts as having “numerous weaknesses” in methodology, most notably a skewed sample and inaccurate and misleading comparisons. Hira quoted an article by Harvard economist Richard Freeman in The Wall Street Journal stating that the study makes “all the scientific sense of cold fusion” and amounts to discovery of “the perpetual employment enhancement elixir.”

    In fact, Hira reiterates, his own research shows that “on balance” the H-1B program “does more harm than good to the American labor market and for American workers….The typical H-1B worker has ordinary skills, skills that are no better than American workers who are currently unemployed or underemployed….In the worst cases American workers are being forced to train their foreign replacements as a condition of severance and eligibility for unemployment insurance.”

    About proposals advocating “stapling a green card” to the diplomas of foreign STEM graduates and exempting these graduates from numerical limits on entry to the U.S., Hira noted that “given the current labor markets [and] high unemployment levels for STEM graduates, such [policies] would distort the normal functioning of the U.S. labor and education markets….This is likely to lead to a crowding out of American students from these programs.”

    With the powerful incentive of a green card, many more students would apply from abroad and universities would not need to offer “financially attractive package[s] to induce American students” to enroll. “The labor market is likely to have a surplus of such workers, reducing wages, increasing unemployment, and sending a signal to American workers and students to avoid STEM job markets.” The overall effect would “induce the markets to supply foreign students and workers who substitute for, rather than complement, American STEM workers and students.”

  13. gregbo says:

    Unfortunately, I have to be brief with my comments. In general, I don’t believe we need more employment visas of any kind, with unemployment as high as it is, especially among people who possess the very degrees that companies (and even startup investors) are looking for.

    Regarding the startup visa, I have some concerns, such as how many people who already have the legal right to work in the US would actually be hired, assuming these startups actually get off the ground. Furthermore, what would stop larger companies from buying these startups, thus removing the restriction that they would be forced to hire a certain % of people who were already legally eligible to work in the US?

    IMO, the US Congress should more carefully review the recruiting practices of the companies that claim to be unable to find qualified workers. The “mismatch” that they claim, from my standpoint, is that they turn away people who cannot be plugged in right away to a given position, even though they have the education and/or background to learn the job in a few weeks.

  14. If you don’t have time for the entire two hours linked above, here’s an interview I did right before the conference which sums up my position in less than three minutes:

    http://www.ncfblog.com/?p=909

  15. Silverdrake says:

    Gregbo wrote: “The “mismatch” that they claim, from my standpoint, is that they turn away people who cannot be plugged in right away to a given position, even though they have the education and/or background to learn the job in a few weeks.”

    I have seen numerous articles noting this exact problem. Companies complain that they cannot find anyone to fill jobs with narrowly defined qualifications, while being completely unwilling to give an otherwise-knowledgeable applicant any training at all in the specifics of the position. Why an H1-B should be given this training and a US citizen/legal resident is not is a damning statement, especially when, as noted by some in this thread, the training is given BY a US citizen/legal resident that the H1-B is replacing.

  16. jos says:

    I can not believe these comments are real.
    I do not claim to understand what is really happening but don´t these people realize that their country was build by “immigrants”.