by Cyrus D. Mehta
, ABIL Lawyer and Gary Endelman The Insightful Immigration Blog
There is no doubt that a Startup Visa would unleash amazing entrepreneurial activity in the United States, which would result in many jobs. The latest version of the Startup Visa Act 3.0
would provide 75,000 visas to individual who are already here in F-1 and H-1B status if their companies receive an investment of $100,000 per year and employ a minimum of two workers in the first year. A three year visa would be given to those who meet this condition. If within the three years, they employ an additional worker each year, they can apply for permanent residency.
According to a Kauffman Foundation study
, the Startup Visa could conservatively lead to the creation of between 500,000 and 1.6 million jobs, which in turn could give a boost to the US economy of between $70 billion and $224 billion a year. A more optimistic estimate would result in 889,000 jobs and a boost to the economy of around $140 billion per year. Vivek Wadhwa,
a big proponent of this bill, estimates
an even bigger boost if half of these companies are engineering and technology companies. Many of these entrepreneurs, according to Wadhwa, will go on to build new companies based on their success, and could also develop breakthrough technologies and some of them could also be the next Google or Apple.
So if this is a no-brainer, why is Congress not passing the Startup Visa Act 3.0? The truth is that no standalone immigration bill will pass unless it is tied to a broader Comprehensive Immigration Reform bill. Indeed, there is an interesting debate between Wadhwa and Congressman Luis V. Gutierrez
on this issue. Guiterrez, although he supports a Startup Visa, has openly admitted
that he will not allow it to pass unless Congress is willing to reform the entire immigration system. Wadhwa feels this is “political gamesmanship” on the part of Guiterrez, and that the Startup Visa can be passed first in order to give the American economy a big boot and this would lead to increased public acceptance for broader immigration reform. Guiterrez, on the other hand, feels that once he allows this to happen, it will be more difficult to pass comprehensive immigration reform.
The disagreement between Gutierrez and Wadhwa may be a false polarity. A nation needs both social justice and good economics; indeed, social justice is the best economics. A good example of the synergy between social justice and economics is Sergey Brin
, who is the co-founder of Google. He came to the US with his parents at the age of six because they faced anti-Semitism in their native Russia. Although Brin graduated from Stanford in computer science, he did not come to the US on an H-1B visa or benefitted under any employment or investor visa category in our immigration system. His parents were able to come into the US based on an immigration program that was designed to protect foreign nationals from intolerance in their native countries. Still, Brin after coming to the US as a youngster was able to go on to found Google, considered one of America’s best and most innovative companies today.
Both Wadhwa and Guiterrez have a point. However powerful the stimulus flowing from the Start Up visa, enactment of Comprehensive Immigration Reform along with the Startup Visa would be infinitely more potent. Reforming a broken system, which includes legalizing the 10 million plus undocumented immigrants in the US, as well as providing quicker and more sensible pathways to legal status, could unleash even greater wealth. Immigrants of all stripes are essentially very entrepreneurial. An undocumented person who is provided legal status can also start a business and this individual need not be a STEM (Science, Technology, Engineering or Math) graduate. Even a non-technology company can create jobs such as a restaurant or grocery chain. Immigration should not be viewed as a zero sum game, and giving opportunities to foreign nationals in the US can result in more American jobs. Under our broken system, it is virtually impossible for an entrepreneur who wishes to start a North Indian cuisine restaurant to bring in a foreign national tandoori chef. A reformed immigration system should hopefully give this entrepreneur access to such a chef from India. A restaurant’s success is possible because of its chef, and when that great tandoori chef can be quickly hired from India, people will start coming to the restaurant resulting in the hiring of restaurant managers and waiters locally in the US. This restaurant’s success can then be replicated, and the entrepreneur can develop a branded chain of tandoori restaurants all over the US, resulting in many more jobs locally.
According to another report sponsored by Cato Institute – The Economic Benefits Of Comprehensive Immigration Reform by Raul Hinjosa-Ojeda
, the legalization of 11 million immigrants would be equivalent to more than $1.5 trillion added to GDP over 10 years. The study considered the economic impact under three scenarios: a legalization program that would ultimately result in a pathway to citizenship, a temporary worker program with no option for permanent resident status and the deportation of undocumented immigrants. Hinjosa-Ojeda concludes that the legalization of undocumented immigrants would provide the most economic benefits to the US. On the other hand, removing undocumented immigrants would be most expensive, costing $2.6 trillion to the GDP over a 10 year period.
The debate between Wadhwa and Gutierrez can be put in a larger perspective. If you believe, as Wadhwa does, that the purpose of immigration is to create wealth, unleash creativity and foster productivity, then the focus should be on entrepreneurs and highly skilled professionals. This explains his approach. If, however, you are mainly concerned with social justice, then you argue for a more comprehensive approach which is what Gutierrez does. It comes down to what you think is most important and what you think has true moral legitimacy. For those who use immigration to bring about social justice, it is family not employment immigration that is morally legitimate. The focus is on using immigration to help the individual immigrant, reunite families, to fight intolerance, poverty and injustice. It is not to make American employers more competitive, and there’s also an impulse to protect US workers. Wadhwa, on the other hand, sees an ethical value and legitimacy in work itself, in work as a creative expression of individual talent. He looks for new avenues especially in STEM fields to unleash creative potential within the culture and context of a capitalist economy.
The economic boom that an enlightened immigration policy would ignite is generational in its dimensions. The immediate benefit from the entrepreneurial energy of the immigrant generation would be transformed and expanded by the diversified talents of succeeding generations. The Tandoori cook of one generation is often followed by the cutting-edge geophysicist of the next. Precisely as the American economy itself is inherently dynamic, the role that immigrants play in it also constantly evolves. For this reason, the sharp contrast provided by Gutierrez and Wadhwa that seem so vivid now will, over time, fade into a more nuanced yet no less compelling portrait. Gutierrez realizes that an enlightened immigration policy can only exist in a compassionate society where social mobility is a lubricant of national cohesiveness. Wadhwa appreciates that immigration is an asset to be maximized not a problem to be controlled. Like all transformational moments in American history, this is pre-eminently a time to try something new.
A month before signing the Emancipation Proclamation, Abraham Lincoln spoke
to our issue in our time:
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The dogmas of the quiet past, are inadequate to the stormy present. The occasion is piled high with difficulty, and we must rise with the occasion. As our case is new, so we must think anew and act anew. We must disenthrall ourselves, and then we shall save our country.
by Cyrus D. Mehta
, ABIL LawyerThe Insightful Immigration Blog
In recent times, there has been a confluence of diverse events, if stitched together, make immigration reform a virtual no brainer even if we have yet to come out of the economic doldrums. Indeed, immigration reform in favor of skilled immigration, even if it is piecemeal and not comprehensive, can stimulate our economy in unimaginable ways.
First, the Census Bureau has officially indicated that white births are no longer a majority in the US
. Non-Hispanic whites accounted for 49.6 percent of all births in the 12-month period ending last July. This is not something to be alarmed about; rather it is cause for celebration. The population in the US is now multi-ethnic and represents the diverse nations of the world. In our hyper-connected world
, Americans who can adapt and interact with others across national boundaries can gain more benefit, bringing about further innovation, ideas and the understanding of other cultures. Of course, critics of increased immigration will bemoan this fact and blame it on the 1965 Immigration Act, which abolished the national origin quota system and opened up immigration to people from all countries. But such fear is driven more by xenophobia than anything else. It is the 1965 Immigration Act, which has brought diversity into the US. Those who have come to the US regardless of their country of origin have clearly contributed to the country in immeasurable ways. They have also forged closer ties between the US and their country of origin. The symbiotic relationship between Silicon Valley and Bangalore is one such example. While it has become a national obsession to comment about America’s declining superpower status, one way for it to continue to remain a superpower and be respected as well as admired is to foster a multi-ethnic population that represents all the countries of the world. Even the rest of the world will sit more comfortably with a multi-ethnic superpower than a superpower that favors one group over all others.
Second, we are on the cusp of what The Economist has called The Third Industrial Revolution
. New advances in manufacturing will soon make the factory as we now know it obsolete. As manufacturing is going digital, especially with the advent of 3D Printer, we will no longer need long lines of factory workers. A product can be designed on a computer and “printed” on a 3D printer, which will have the potential of rendering supply chains obsolete. Also, the factory of the future will run on its own devoid of workers in oily overalls, and as The Economist presciently notes, “[m]ost jobs will not be on the factory floor but in the offices nearby, which will be full of designers, engineers, IT specialists, logistics experts, marketing staff and other professionals. The manufacturing jobs of the future will require more skills. Many dull, repetitive tasks will become obsolete: you no longer need riveters when a product has no rivets.” The US needs to attract these new skilled professionals who will run the factories of the future.
Third, a new report, Not Coming to America: Why The US Is Falling Behind In the Global Race for Talent
, reveals how foreign countries are reshaping their immigration policies to boost their economy while the US remains mired in an obsolete and broken immigration system. The US is thus losing talent to other countries. The report, which has been issued by Partnership For A New American Economy, headed by NYC Mayor Michael Bloomberg, identifies three major risks if it does not reform its immigration laws: a shortage of workers in innovation industries, a shortage of young workers and slow rates of business startup and job creation. US companies are hungry for jobs in science, technology, engineering and math (STEM), but these jobs are hard to find among native US workers. The report also explores the more business friendly immigration policies of Australia, Canada, Chile, China, Germany, Ireland, Israel, Singapore and the United Kingdom in attracting talented immigrants and entrepreneurs. For instance, New Zealand has a rather broad welcoming policy for foreign entrepreneurs. There is no specific job creation or minimum capital requirement, and after two years of self employment “beneficial to New Zealand,” the entrepreneur can apply for permanent residency.
This fortuitous alignment of the stars bodes well for reform of our immigration system, which is not just creaky and obsolete but completely broken. The US has no special visa category that would encourage entrepreneurs to start innovative businesses and become permanent residents. The H-1B visa, which US companies rely on to bring in foreign skilled employees, especially in the STEM fields, is hobbled by a 65,000 annual cap, and the numbers under the FY2013 cap are expected to be reached many months ahead of the start of the next fiscal year, October 1, 2012! Even the employment-based immigration system has broken down even though there is no national origin quota. If you are born in China and India, and have been sponsored by an employer through the onerous labor certification process, it can take several years, even decades, before you get permanent residence.
One wonders how the US has an immigration system dominated by quotas, which also micromanages the employer and foreign national worker, when it espouses free market capitalism. Such a system is more reminiscent of one that could have been designed by communist apparatchiks in the former Soviet Union
. In order to unleash economic growth, it is essential to allow foreign nationals easy access into the US so that they can implement their ideas, create companies and employ more Americans. In a recessionary economy, we need more entrepreneurs to set up businesses and create jobs, and immigrants may have a greater propensity to engage in entrepreneurial activities. There may be a ray of hope. In a rare bipartisan move, freshman senators Marco Rubio (R-FA), Chris Coons (D-Del.), Jerry Moran (R-Kan,) and Mark Warner (D-Va) have introduced Startup Act 2.0
, which includes immigration-related provisions to attain the following objectives:
- Creates a new STEM visa so that U.S.-educated foreign students, who graduate with a master’s or Ph.D. in science, technology, engineering or mathematics, can receive a green card and stay in this country where their talent and ideas can fuel growth and create American jobs;
- Creates an Entrepreneur’s Visa for legal immigrants, so they can remain in the United States, launch businesses and create jobs;
- Eliminates the per-country caps for employment-based immigrant visas – which hinder U.S. employers from recruiting the top-tier talent they need to grow.
While the chances of this bill passing in the current partisan political climate, prior the 2012 Presidential elections remain remote, one can still be surprised. After all, immigration ought to cut across partisan lines, and our elected representatives need to enact sound immigration proposals for the good of the country and the world. Although it would be ideal to comprehensively reform our immigration system, which would include providing a path to legalization for the millions of undocumented immigrants, small but meaningful initiatives such as Startup 2.0 could still be passed in the mean time. In the event that Startup Act 2.0 goes nowhere, there is still scope within our existing system to encourage skilled and entrepreneur immigration if only our immigration
bureaucrats interpret existing immigration visa categories generously rather than in a mean spirited and niggardly manner. For instance, the intra-company transferee L-1A visa ought to remain a viable option for an entrepreneur to establish a branch or subsidiary of a foreign business in the US. Yet, in recent times, L-1A petitions get turned down wholesale on the ground that a small startup entity can never support a person in an executive or managerial capacity. This is nonsense and bureaucratic gobbledygook, as Congress never intended that small businesses could not support entrepreneur executives or managers. Sad to say, we happen to be in double whammy mode of no good legislation, along with bureaucrats reading out existing visa categories out of the law. The writing is on the wall, and unless we want to perversely see America spiral into decline, it is time to act fast and enact sound immigration reform.
Cyrus D. Mehta
, ABIL Lawyer The Insightful Immigration Blog
H.R. 3012, the Fairness for High Skilled Immigrants Act
, was passed in the House on November 29, 2011 by a landslide 389-15 vote
. Introduced by Rep. Chaffetz (R-UT), it eliminates the employment-based per country cap entirely by 2015 and raises the family-sponsored per-country cap from 7% to 15%. If H.R. 3012 does become law, it will significantly decrease the wait times for certain countries in the employment-based preferences, especially India and China. Even wait times in the family-based preferences will get reduced.
H.R. 3012 only redistributes the allocation of visas, it does not increase the visas that are fixed in number each year. As a result of the existence of the per country limits, those born in India and China have been drastically affected by backlogs. Each country is only entitled to 7 percent of the total allocation of visas under each preference. Thus, a country like Iceland with only 300,000 people has the same allocation as India or China with populations of more than a billion people. For instance, in the Employment-based second preference (EB-2), those born in India and China have to wait for over 5 years to obtain green cards while all other nationalities do not have any wait times. The situation is even more dire in the Employment-based third preference for India (EB-3). Under the per country limit for India in the EB-3, only 2,800 visas can be allocated each year while an estimated 210,000 Indians, along with their dependants, are eligible for green cards. As a result, according to a report of the National Foundation For American Policy
, the waiting time for a green card for an Indian under the EB-3 has been estimated to be 70 years, while it may be over 5 years for others.
As a result of such unmanageable waiting times, skilled foreign nationals in the pipeline for a green card, especially from India and China, have no incentive to stay in the US even though they may be invaluable to their employers who have sponsored them by demonstrating that there were no US workers available for the position. Many of these skilled immigrants have graduated with degrees in science, technology, engineering and math (STEM), vital to US growth and innovation. Such skilled workers are generally on H-1B visas, but many are on other nonimmigrant visas such as the L visa too. Even though they are able to extend their H-1B visas beyond the six year limit while waiting for the green card under provisions in the American Competitiveness in the 21st Century Act (AC21) (and many are already past 10 years on the H-1B visa), they are generally bound to the same employer during the green card process and their spouses cannot work. If their children turn over 21, they lose the ability to remain on the H-4 dependent status and most likely will also be unable to derivatively get the green card along with the parent.
The passage of H.R. 3012 has been met with jubilation
by Indians and Chinese, but those from the rest of the world may not be so happy. While Indians and Chinese may still need to wait, the waiting times will get more tolerable, but others who did not have to wait in the EB-2 will now need to wait. While it is hard to predict, there may eventually be waiting times of 1-2 years for all countries in the EB-2. While everyone in the EB-3 is subject to unreasonable waiting times, upon the elimination of the per country limits, Indians may still need to wait but it will not be for 70 years. Instead, it may be 10-12 years for all EB-3 nationals, according to the NFAP report. Those who have priority dates prior to November 2005 in the EB-3, according to the NFAP report, will need to wait only 1 to 2 more years instead of an additional torturous 11-18 years. While waiting times for Indian and Chinese may likely lessen, waiting times for all others may go up in both the EB-2 and the EB-3.
H.R. 3012 is thus not a perfect bill. It also has to be passed by the Senate before it becomes law, and there is an identical version introduced in the Senate. At present, Senator Grassley (R-1A), who has been a foe to skilled immigrant from India, including H-1Bs used by Indian IT companies, has placed a hold on legislation in the Senate. Senate procedures allow any member of the Senate to place such a hold on legislation, and it is uncertain whether Grassley will release his hold in the near future, although he is being persuaded to do so by colleagues and advocates. What is so significant about H.R 3012 is that it received bipartisan support and that too by a landslide, especially in a time when such bipartisan support on other measures is rare or non-existent. The easy passage of H.R. 3012 also shows that there is concern about the unfairness and imbalance in the system towards certain countries, especially India and China. Indeed, although the country limits were originally enacted for all countries, it has resulted in invidious discrimination within the immigration system for Indians and Chinese.
Things may work out better than expected if H.R. 3012 became law, though, as we have lived without per country limits in recent times. Prior to Jan 1, 2005, the EB numbers were always current because AC 21, enacted in 2000, recaptured 130,000 numbers from 1998 and 1999, and the per country limits were postponed under a formula until the demand in the EB outstripped the supply. The lack of per country limits helped, but we also had the additional unused numbers. However, at that time, we also had a surge under the 245(i) program, which we do not have today. The notes in the January 1, 2005 Visa Bulletin
, when there was retrogression in the EB-3 for the first time after AC21, explains it all.
In conclusion, even if H.R. 3012 imposes waiting times on others who were hitherto not affected in an unfair system while decreasing the wait times for Indians and Chinese, it is consistent with principles of fairness.
The words of Justice Jackson ring true with respect to H.R. 3012 too:
“The framers of the Constitution knew, and we should not forget today, that there is no more effective practical guaranty against arbitrary and unreasonable government than to require that the principles of law which officials would impose upon a minority be imposed generally. Conversely, nothing opens the door to arbitrary action so effectively as to allow those officials to pick and choose only a few to whom they will apply legislation and thus to escape the political retribution that might be visited upon them if larger numbers were affected.”Railway Express Agency, Inc. v. New York
, 336 U.S. 106, 112—113 (1949) (concurring opinion).
Of course, H.R. 3012 ought to be viewed as a first baby step towards more comprehensive immigration reform. Even if it does become law, and skilled immigrants continue to wait, who may not only be Indians or Chinese, Congress will realize that the ultimate solution is to increase the visa numbers, rather than to maintain fossilized quotas that never change and are oblivious to economic and global realities. If there is no consensus for an overall increase in the 140,000 visas that are allocated each year to EB immigrants, Congress can exempt certain people from the numbers such as graduates with STEM degrees, or better still, dependent family members. Such carve outs too could restore further balance and integrity to the US immigration system.
by Cyrus D. Mehta
, ABIL LawyerThe Insightful Immigration Blog
I was pleased to see the announcement below. Immigration and Customs Enforcement, (ICE) of all agencies, expands immigration benefits to students who have graduated in science, technology, engineering and math degree programs (STEM) fields. ICE, which has been deporting non-citizens in high numbers in recent times, ironically acknowledges that this is a "continued commitment to fixing our broken immigration system and expanding access to the nation's pool of talented high skilled graduates in science and technology fields."
The 17 month extension of Optional Practical Training for STEM graduates is a good example of how the Administration can fix problems within our broken immigration system in the face of Congressional inaction. The 17-month extension was in response to the crisis caused by the H-1B cap in previous years. Even if presently, under the FY2012 H-1B cap, there are still plenty of H-1B visas, the quota is likely to get filled prior to the end of FY 2012. The expansion of STEM fields will benefit both employers and foreign students when they are next confronted with the filling of the H-1B cap. The 17-month STEM OPT extension rule was promulgated in the absence of any Congressional action. The rule also withstood a court challenge by the Programmers Guild in the Third Circuit on the ground that Congress acquiesced by never objecting to the concept of practical training whenever it previously legislated on immigration. See Programmers Guild, Inc. v. Chertoff, 338 Fed. Appx. 239 (3rd Cir. 2009)
In The Tyranny of Priority Dates
by Gary Endelman and Cyrus D. Mehta, we have forcefully argued that the Administration has the power to creatively fix our immigration system administratively, and used the STEM OPT extension as an example. What is intriguing about this ICE announcement that it comes closely on the heels of President Obama's speech on immigration in El Paso on May 10. While many think that Obama's recent meetings on immigration and his El Paso speech do not amount to much, the fact that his administration expanded STEM fields after the speech reveals that he may still have a nuanced plan to change the game on immigration. Expanding STEM fields is a baby step, and he can do a lot more administratively such as halting deportations for DREAM students
. The President can justify such administrative fixes as our immigration system no longer works and is not what Congress intended when it enacted the preference system in 1965, which was expanded in 1990., but is unable to cope with present day realities. By taking bold administrative steps now, he can force Congress to bless them later either through acquiescence (by taking no action) or by affirming through legislation.
ICE announces expanded list of science, technology, engineering, and math degree programs
Qualifies eligible graduates to extend their post-graduate training
WASHINGTON - U.S. Immigration and Customs Enforcement (ICE) today published an expanded list of science, technology, engineering, and math (STEM)
degree programs that qualify eligible graduates on student visas for an Optional Practical Training (OPT) extension-an important step forward in the Obama administration's continued commitment to fixing our broken immigration system and expanding access to the nation's pool of talented high skilled graduates in the science and technology fields.
The announcement follows President Obama's recent remarks in El Paso, Texas, where he reiterated his strong support for new policies that embrace talented students from other countries, who enrich the nation by working in science and technology jobs and fueling innovation in their chosen fields here in the United States, as a part of comprehensive reform.
By expanding the list of STEM
degrees to include such fields as Neuroscience, Medical Informatics, Pharmaceutics and Drug Design, Mathematics and Computer Science, the Obama administration is helping to address shortages in certain high tech sectors of talented scientists and technology experts-permitting highly skilled foreign graduates who wish to work in their field of study upon graduation and extend their post-graduate training in the United States.
Under the OPT program, foreign students who graduate from U.S. colleges and universities are able to remain in the U.S. and receive training through work experience for up to 12 months. Students who graduate with one of the newly-expanded STEM degrees can remain for an additional 17 months on an OPT STEM extension.