7 ms·
Free the H-1Bs, Free the Economy
- fnid 17y agoThis is a very biased article. The author neglects to mention that a very large portion of income generated by foreign born workers is sent home by those workers. The money doesn't stay in America to benefit the American economy. It also doesn't benefit the case to call those opposed to more immigration Xenophobes. They aren't xenophobes, they are rationally aware of the situation. Also, what he says is not true according to the research: http://news.ycombinator.com/item?id=794685 http://news.ycombinator.com/item?id=794685 and http://news.ycombinator.com/item?id=794677 http://news.ycombinator.com/item?id=794677 Furthermore, H1-B's are not "highly skilled." The majority of H1B workers take entry level jobs. There is an O-1 visa for highly skilled workers and there is no cap on this visa. If this debate was really about bringing in more highly skilled workers, then why argue for uncapping the lower skilled visa? Wouldn't corporations just bring in more O-1 visas, for which there is an unlimited supply available? The reality is that O-1 visas cost more than H1B visas to employ. This debate is really about concentrating more power in the corporations and erradicating the middle class in America.
- kiba 17y agoAll economies depend on trade and division of labors to be prosperous. So money going back to India and other countries may help increase global trade.
- fnid 17y agoIt will increase consumption in those countries, but not necessarily consumption of american goods. I think that money will benefit America more if it stays in America. This will happen if we employ more Americans who spend all of their money in America, rather than sending some of it to family members in other countries.
- rdtsc 17y agoIt's nice to help India's economy, or China or Russia. Unfortunately, US is not in the charitable business of helping developing economies.
- kiba 17y agoYou did not clearly understood the implication of "trade" part. If trade is central to the wealth of society, then more trading with other economies of the world will lead to increased wealth in the US. In fact, we have the largest free trade zone right here in the US. Goods and services in the US, for the most part, move freely.
- fnid 17y agoIncrease in wealth for whom? The upper class or the middle class or the lower class? I think qui bono is the central question in this issue. The wealthy in America benefit, but the middle and lower class does not. Research shows, as the middle class increases in wealth, then so does the whole economy and through increasing H1B's, we are eliminating the middle class american worker to jobs overseas.
- kiba 17y agoCommon sense should already suggest that trade is mutually benefical because well, I get stuff that I wanted, and you get stuff that you want. Why should trade only specifically benefit some certain classes of society? Read the article on comparative advantage. http://en.wikipedia.org/wiki/Comparative_advantage http://en.wikipedia.org/wiki/Comparative_advantage This is the reason why we specialize and trade, because everybody will be better off.
- rdtsc 17y agoNot necessarily, it depends who controls the trade. There is rarely such a thing as "free trade" or "free market" -- it is a pipe dream. Trade is mostly about controls, tariffs and subsidies. Usually the powerful side control the trade. > largest free trade zone right here in the US. That is true, but I thought we are talking about internation trade.
- pieceofpeace 17y agoThat money goes after tax has been paid, house bought etc. It has many immediate benefit for the host country. The host is not subsidizing the alien's home country.
- xiaoma 17y agoThe reality is that very, very few highly skilled technical people, even people like Jerry Yang or Sergey Brin would have qualified for O-1 visas if they had needed to try. It's also indisputable that Yahoo! and Google have each generated a lot of jobs an a lot of tax revenues for the US. The following is from Wikipedia: Generally, to qualify for O-1 classification, aliens of extraordinary ability in the sciences, education, business, or athletics must demonstrate sustained national or international acclaim and recognition for achievements in the field of expertise by providing evidence of: Receipt of a major, internationally recognized award, such as the Nobel Prize; or at least three of the following forms of documentation: 1. Documentation of the alien's receipt of nationally or internationally recognized prizes or awards for excellence in the field of endeavor; 2. Documentation of the alien's membership in associations in the field for which classification is sought, which require outstanding achievements of their members, as judged by recognized national or international experts in their disciplines or fields; 3. Published material in professional or major trade publications or major media about the alien, relating to the alien's work in the field for which classification is sought, which shall include the title, date, and author of such published material, and any necessary translation; 4. Evidence of the alien's participation on a panel, or individually, as a judge of the work of others in the same or in an allied field of specialization to that for which classification is sought; 5. Evidence of the alien's original scientific, scholarly, or business-related contributions of major significance in the field; 6. Evidence of the alien's authorship of scholarly articles in the field, in professional journals, or other major media; 7. Evidence that the alien has been employed in a critical or essential capacity for organizations and establishments that have a distinguished reputation; 8. Evidence that the alien has either commanded a high salary or will command a high salary or other remuneration for services, evidenced by contracts or other reliable evidence.
- rdtsc 17y ago> Hundreds of thousands of mostly very smart and highly educated workers who could be starting companies are not. Alright, but millions of Americans could be starting companies as well, but are not. In fact, America is _not_ as an entrepreneurial country with lots of little small business owners as we'd like to think. That is the propaganda bullshit we get fed on every election cycle "we got help America's small business. We gotta help Joe The Plumber...blah...blah." In fact America businesses are mostly large behemoths employing tens of thousands of minions. There was just a recent report from the Center for Economic and Policy Research ( http://www.cepr.net/index.php/publications/reports/int-comp-small-business/ http://www.cepr.net/index.php/publications/reports/int-comp-... ) that compared employment in small businesses among the developed nations. US is consistently at the bottom when it comes to self-employment or employment in business with less then 20 people. The biggest reason -- the high cost of health insurance. So I don't buy the bullshit about "if immigrants could only start their companies, then our economy would boom..." Unless, of course, the author is implying that immigrants are going to run sweatshops where employees don't get health insurance...
- rantfoil 17y agoEven within YC, our own Summer 08 batch, there are several startups by non-Americans that have been very successful at building useful products, raising money, and altogether creating value for the US economy. But those same startups have to jump through a million hoops just for the right to exist in our borders. So this effect is real. I don't claim to know to what extent our economy could be affected positively or negatively, but it is real.
- rdtsc 17y ago> But those same startups have to jump through a million hoops just for the right to exist in our borders. > I don't claim to know to what extent our economy could be affected positively or negatively, but it is real. The question then is, who are we trying to help here? Do we want to help the immigrants or the American economy? Unless, we can show how the hassle of immigrants trying to setup startup is seriously damaging our economy, then this starts to look more and more like we just want to provide some convenience for the immigrant workers. Of course, we should provide convenience, and should certainly not make it difficult on purpose, but that is not a top priority. We shouldn't be called xenophobes if we don't push this task to the priority of our things to do at the moment.
- vaksel 17y agoyeah that's what we need, more H1Bs...after all its not like we have a lot of unemployed. The job growth rate has dropped significantly, why should we increase our population when we don't have the jobs to support them? these were posted on TC: 1950’s Population Growth = 11,516,000 Employment Growth = 7,215,000 (62.65%) 1960’s Population Growth = 19,449,000 Employment Growth = 13,862,000 (71.27%) 1970’s Population Growth = 30,811,000 (Depression in Mexico) Employment Growth = 21,224,000 (68.88%) 1980’s Population Growth = 20,865,000 Employment Growth = 17,685,000 (84.76%) 1990’s Population Growth = 21,667,000 Employment Growth = 16,998,000 (78.45%) 2000’s (Mar. 2009) Population Growth = 26,254,000 Employment Growth = 5,137,000 (19.57%)
- icey 17y agoWhat percentage of those figures actually relates to the technology industry?
- mrkurt 17y agoThe article advocates "freeing" existing H1Bs, not expanding the H1B program (though that might be good too).
- rantfoil 17y agoThere's two issues here -- one is that there's a brain drain in the United States. The best and the brightest are leaving. They can't stay, because we won't let them. The fix is letting them, by reforming H1B policies. Second is H1B abuse by large corporations. This is a legit problem -- some IT firms bring in people they shouldn't (sometimes thousands at a time), and this takes up H1B's from talented people who should get them. Again, the fix requires the government to figure out who is abusing it, and changing the policies to prevent them from doing so.
- vaksel 17y agoi don't buy the brain drain issue, sure there are probably some geniuses in the millions of H1B people, but majority are not that much better than the average American worker. So out of those few geniuses, what tiny percentage leaves? They aren't leaving for the sake of leaving, they are leaving to exploit the opportunities in their home countries
- jyothi 17y agoReminds me of PGs "Founders Visa" article - http://www.paulgraham.com/foundervisa.html http://www.paulgraham.com/foundervisa.html It is a win-win for America and hundreds of entrepreneurs in other countries where the startup ecosystem doesn't exist and ofcourse many would want to build businesses for developed economies than attempt to run something in their home economy which probably can't pay enough. They might go back and build something few yrs down the line or invest in their home countries nevertheless America would have benefited in the mean time. And this is not even converting all H1-Bs at least the capable ones to start their own firms.
- rantfoil 17y agoI've seen H1B essentially lock up some of the brightest people I've worked with... for years. Even a decade or so. You have to get sponsored, and you can't leave your corporate home. It's a strange, watered down form of identured servitude. The fact that H1B's have no mobility also depresses wages and reduces the incentive for corporations to be a great place to work because the switching cost for these workers is much higher. So hiring a lot of H1B's actually do offer corporations an incentive that is more insidious than you might think. That's the bad form of H1B. Corporations bringing worker drones for cheap. But that's why this specific reform can affect the system for the better.
- barrkel 17y agoAnd of course the depressed wage / indentured servitude plays into the xenophobic / "dey tuk ur jerbs" crowd as an argument against immigration reform.
- ojbyrne 17y agoTotally off-topic, but this is the first thing I saw after getting my new shiny US visa. Couldn't help but share.
- sachinag 17y agoThis is bullshit. Here's actual data: http://www.businessweek.com/table/08/0305_h1b.htm http://www.businessweek.com/table/08/0305_h1b.htm More (I don't know the source, but seems correct): http://www.myvisajobs.com/Top_Visa_Sponsors.aspx http://www.myvisajobs.com/Top_Visa_Sponsors.aspx Lookit, a lot of the H1-B slots are being taken up by consulting firms. We don't have a shortage of H1-Bs; we just allocate them poorly. That's what we need to fix. As to the (what I consider a minor) founding issue, that's pretty simple: find an American co-founder. Form a company, apply for a second H1-B, and you can work for the NewCo from the minute you file (if you already have an existing one). Work on the side, make something people want, then transfer over the main H1-B once the NewCo has revenue/investment. Hell, I'm happy to sign on as a co-founder for as many companies as I can until INS stops me.
- rdtsc 17y agoI agree. This is like trying to fix the high rate of injuries by getting more band-aids. To me it seems the article is advocating changing the legislation to make it more convenient for immigrant workers. That is of course followed by a stern warning to us 'xenophobes' that if we don't our economy will be ruined. They should instead advocate for punishing large corporations for gaming the system, underpaying H1-B employees and depressing everyone else wages. For every 'smart' and 'bright' H1-B visa candidate there are a thousand of unqualified ones, with flaky academic or employment history record. The reason they are here, because they are willing to work for %30 less than Americans are.
- gojomo 17y agoYour proposal means more bureaucratic rules about what jobs are comparable and what pay rates should be. That's moving in the wrong direction, if you want growth and high-employment. The article provides a much more simple solution: if someone qualifies to work in the USA, end the rules which tie them to a specific job. It's those rules that cause the gaming, limit competition by employers, and cause lower pay.
- agmiklas 17y agoConsider this, though. Even the most qualified H1-B candidate can end up getting paid less than they should simply because of the way the green card application process works. Once an H1-B holder has filed for a GC, they can't be switch employers or be promoted. Since most companies have pay caps based on job title, this means the H1-B holder can't get raises past a certain point. The end result of all this is you have H1-B "junior engineers" who've worked at the same company for 5+ years really doing the job of a intermediate/senior engineer. The joke is that the company is not "gaming the system" at all. By not promoting someone with an outstanding GC application, they're doing exactly what the law requires of them.
- rams 17y agoThe author Vivek Wadhwa, iirc, used to be a very prominent H1B critic. Wonder what's made him change his mind ?
- old-gregg 17y agoMore programmers to free the economy? Come on... To REALLY free the economy we need a million of doctors from France, India, UK and Cuba competing here, locally, against our home grown millionaire surgeons. The #1 reason companies are outsourcing and people are leaving is this enormous burden of medical racketeering. Come on, the world is so much larger than the information technology sector and most problems that can't be solved by coding.
- maggie 17y agoFreeing the H1-B wouldn't just help out programmers, but all disciplines, including doctors.
- jquery 17y agoYes, and we could also get rid of the requirement of an undergrad before med school, as well as increase the caps on med school enrollment. There is so much low hanging fruit that has mysteriously remained almost completely absent in the current USA health care debate.
- gojomo 17y agoLiberalizing immigration in all other skilled industries is a good idea, too. ADDED: Note that neither "programmer" nor "software" appear in the original article: the author is talking about all H1-Bs, which includes medical specialists. (Though, licensing issues might prove a more significant employment barrier for foreign doctors than immigration rules, and those also need to be addressed.)
- bilbo0s 17y agoYour words will be lost on most people here friend. For them, 'raising money' is 'creating wealth'. <sigh> I agree though, we should stop bringing in programmers and start bringing in doctors.
- TriinT 17y agoAfter the collapse of the USSR, lots of medical doctors and other specialized workers found themselves without a job. Today in Western Europe you can find construction workers who were doctors in the Ukraine SSR or Moldova in the 1980s, These people are a huge source of qualified work, but to the best of my knowledge only one country (Portugal) has shown any interest in re-training them as doctors to meet the severe lack of qualified medical personnel. It's interesting to note that in the former Soviet republics, being a doctor did not have the same status (let alone financial compensation) as in the West. I know that Canada has been trying to lure medical doctors from abroad (Eastern Europe and elsewhere) in recent years, but they're after the young graduates, not the old veterans who were disowned by the fall of Communism. Unfortunately, the doctors' lobby in the U.S. is too powerful. In order to keep their salaries inflated, they will never allow the U.S. to import doctors from abroad, even if that would mean that the average American would have access to more affordable healthcare.
- ankeshk 17y agoTo protect their populations against internal and external threats and revolts, Sparta - the ancient Greek city-state made a few decisions. 1. Every Spartan citizen has to join the army and train since childhood to become the best fighter possible. Weaklings are killed at birth. 2. The currency of Spartans was changed to heavy iron bars. Prevented folks from other neighbouring city-states from doing business with Spartans. This made Sparta very independent. And their citizens became the best fighters the world had ever seen. People looked up to them in awe. Poems are written about them. But these same protectionist rules that made Sparta glorious for little time, led to Sparta decline in the long run. Populations declines. Wealth declines. Progress declines. Moral of the story has always been: protectionism brings short term benefits but long term doom. But yet we'll always see the majority of the people rooting for protectionism for short term progress. (I'm pretty sure I'll be slammed for this post because there is no direct relation or parallels between Spartan policies and American policies. Time was different. Threats were different. Rules were different. But I had to write it to make a point against general protectionism. And not against any specific American policy including the one being talked about here - restricting H1-Bs.)
- gaius 17y agoBut these same protectionist rules that made Sparta glorious for little time, led to Sparta decline in the long run. What did for the Spartans was all dying glorious deaths before having enough kids. The Spartan economy, operated by the Perioikoi and Helots, was strong enough, but it relied on there being a critical mass of adult male Spartans to maintain it. Protectionism was little to do with the fall - the Perioikoi could trade with whomever they pleased.
- ankeshk 17y ago1. Yes but Spartan rules of being killer fighters made immigration impossible. 2. The Perioikoi could trade with whomever they pleased - but - but no one wanted to trade with them because of the iron slabs being used as currency of exchange. Dig a little deeper into the motives as to why such rules were made by the Spartans and you will see that it was pure protectionism.
- kansando 17y agoThis article and all others on the topic seem to confuse two different trends: 1> That there is a real incentive for the very best to return to India and China because they are self-confident and know that they can thrive anywhere, and 2> That the current H1-B regime (read indentured labor) is abused by corporations, especially IT outsourcers to bring in bodies. In my case, after a PhD at a top 5 engineering school and a 7 year wait at a Fortune 500 company, I finally got a Green card. I started a company within a month of that, we have over 100 employees (all in the US) and we are hiring today. The generation of PhD's before me used to get their Green Cards in three months. I see a lot of my friends now contemplating a return to India and China. I think this is bad for the US and bad for Silicon Valley. It basically comes down to this, in intellectual fields, the most productive workers are 10X better than the median. Multiple that with a 10X tolerance for risk (which a lot of immigrants with much lower fixed costs and lower expectations from life tend to have) and you are talking about losing someone who is 100X more valuable (in economic terms) than the average worker. If we don't figure out who these people are and insist on having them wait in the H1B line along with everyone else, we are doing ourselves a great disservice. BTW my cofounder is American, also falls in the 100X category - so this is not a statement about "all Chinese/Indians are superior to all Americans". His daughters are learning Chinese as a backup plan. By mixing legal with illegal immigration (due to the relative strength of some of the lobbies) and uber-skilled with somewhat skilled immigration, we are creating a mess.
- nanijoe 17y agoWow.. it is evident that most of the commenters here do not really understand 1. The H1B process and/or 2. What the author of the techcrunch article is saying. In a nutshell, and H1B visa is attached to a company, so if you have one, you cannot go work for another company or even start up your own. What the author is advocating is that the president/government lift these restrictions, so that the skilled foreigners who already live in the USA can go ahead and help the economy grow. Of course lifting the restrictions would probably mean that employers will be less willing to sponsor people for H1B visas, knowing that they can walk away anytime they please.
- tnovelli 17y agoRight on - H1B is akin to indentured servitude. It's hard for the rest of us to compete with a captive work force.
- cema 17y agoI am aware of this argument, but it has always seemed strange to me. Surely slave labor is not efficient.
- seldo 17y agoTo be completely accurate, H1-Bs are attached to an existing company. You can transfer your H1-B to another company, as long as that company is will to spend time (a couple of months) and money (several thousand dollars) to sponsor your H1-B. You cannot, however, start your own company. H1-Bs are, as the blog post says, a huge barrier to employee mobility and the creation of startups. Another common type of visa in the valley is the L1. Big companies like Google, Yahoo and Microsoft, who have foreign subsidiaries, hire people in those countries. After they have worked in the foreign office for a year they can apply for the L1, which is an "internal transfer". This allows them to work in the US, but only for that company. You cannot ever work another company than the original sponsor of your L1. This really is indentured servitude (though of course it's usually quite well paid).
- zhyder 17y agoI agree with the author's thesis but I'm bothered by the way the numbers are presented. Other articles in favor of making immigration for skilled workers easier usually are guilty of the same number fudging. In the article: "My research team documented that one quarter (http://ssrn.com/abstract=990152 http://ssrn.com/abstract=990152) of all technology and engineering startups nationwide from 1995 to 2005 were started by immigrants." The linked source says it more precisely: "We found there was at least one immigrant key founder in 25.3% of all engineering and technology companies established in the U.S. between 1995 and 2005 inclusive." The key words in the second quote are "at least one immigrant key founder"; there are typically 2-4 founders in a startup (YC's avg is 2.5). If we just calculate what fraction of founders are immigrants across all startups (=total_immigrant_founders/total_founders), the number should only be ~ 11% [1], which sounds less dramatic but is more accurate in terms of how much credit immigrant founders deserve for the startups. Similarly "more than 25% of U.S. global patents had authors who were born abroad" should really mention what fraction of inventors listed on patents are foreign-born, since patents typically have many coinventors. [1] - There's probably actual data on this somewhere, but if we assume the probability p of a founder being immigrant is independent of other founders, and the number of founders per startup = 2.5: => 1 - (1-p)^founders_per_startup = probability_that_startup_has_at_least_1_immigrant_founder => 1 - (1-p)^2.5 = .25 => p = .1087