History is likely to repeat itself with President Joe Biden's immigration proposal. Yes, the plan is commendable for its two goals of providing the 11 million or so undocumented immigrants with a route to citizenship and reintroducing visas for highly skilled workers. But as the saying goes, this dog won't hunt. This is because both sides of the corridor in US Congress find aspects of the legislation uncomfortable. Even if the Democrats eliminate the filibuster so that they can pass laws with little control over the Senate, experience shows that democratic lawmakers are unlikely to reach consensus themselves.
This is a repetition of the political struggles of the Obama years, when Republicans strongly supported skilled immigration while the Democrats held US corporations and their would-be workers hostage to demand citizenship for undocumented people. The Democrats also fought against each other when Senator Dick Durbin overturned bipartisan legislation to lift discriminatory restrictions on visas per country, leading immigrant groups to label him a racist. Unfortunately, the results of the Biden Plan will be the same: warfare between and within the parties; no immigration reform; and another downgrade on US competitiveness.
There is a simple solution: separate qualified and unskilled immigrants into separate bills – and leave each law stand for itself. Giving skilled immigrants the opportunity to study, work, live, and build businesses in the United States is the best business free lunch the country can ever offer. There is a non-partisan agreement on qualified immigration. That part of Biden's plan would be an easy, quick, and significant achievement for the new administration.
The Obama and Trump administrations presided over a lost decade for immigration reform. When we wrote The Immigrant Exodus in 2012, Washington was at a similar point as it is today. Faced with an uncertain future as to their status, highly skilled immigrants were already beginning to flee the United States. Then it got worse: since 2013, when Congress failed to reform and entered a toxic period of bipartisan political conflict and immigrant bashing (the latter mostly by Republicans), many thousands of startups have been launched or grown in the United States founded elsewhere or moved abroad. The United States had longest had the world's highest concentration of “unicorns” – startups with a market capitalization of a billion dollars or more. However, over the past decade they have established themselves elsewhere. Today China is the fastest growing region for unicorns. India now has dozens of them too. A Shanghai-based financial research firm found that China now has more unicorns than the US, and India expects to have more than 50,000 startups, including 100 unicorns, by 2025.
We've already shown in our research that immigrants and their children start many of the most successful businesses, including Apple, Google, Tesla, WhatsApp, Instacart, and Slack. A 2018 study by Crunchbase found that the majority of unicorns in the US were founded or led by immigrants. Although the concentration of wealth and market power among these tech giants has been linked to income disparities and even job relocations, successful tech companies create disproportionate employment and wealth. The state of California posted a $ 15 billion state budget surplus in 2020 – a pandemic year – mainly driven by capital gains and secondary economic impacts from startups.
More difficult to grasp, but at least as important, are the hundreds of thousands of immigrants in science who have chosen to use their talents elsewhere. Along with them have gone future inventions and skills that are vital to US competitiveness. A 2017 analysis found that foreigners were 81 percent of full-time electrical engineering students and 79 percent of computer scientists. In the past few decades, many of these students stayed in order to obtain permanent residence permits and start businesses. We used to worry that they would return home with their skills and training in an instant. But the truth is worse: you don't even come here to study anymore. A November 2020 survey of 700 US universities found that international students have fallen by a staggering 43 percent. China, India, many European countries, and Canada have all focused on attracting more international students in the STEM fields – science, technology, engineering, and math – by giving away the award for a route to residence and even citizenship. They also lure their own nationals home to U.S. universities, which has become an increasingly easy sale given the unfriendly and unsafe environment for immigrants in the U.S.
The STEM problem is compounded by the fact that many US companies are using H1-B visas to retain STEM graduates, many of whom then have to wait decades for the US government to approve their green cards. These visas tie the foreign workers to their jobs and allow the employer to pay them less than they could earn – which also lowers wages for American workers. According to recent research by Michael Roach and John Skrentny, professors at Cornell University and the University of California, the H1-B guest worker visa was the primary route the majority of international STEM PhD students have taken to staying and staying in the US work.
Biden's comprehensive immigration policy proposal would greatly improve the status quo. His proposal would make it easier for H1-B owners to work at other companies and their spouses to work legally in the United States. The bill would increase the length of time that STEM graduates can legally stay in the U.S. to find work or find businesses. Your skills could be used in the US economy.
But there are a couple of things Biden could do better. Any reform should remove country-of-origin restrictions on employment-related green cards and exclude dependents from counting for such restrictions. The Biden plan does not include a starter visa with a path to citizenship. This is critically important: Founders who either have employees in the United States or have raised funds for a start-up for the purpose should be able to stay and gain an expedited route to citizenship.
The problem with the all-or-nothing approach that the Democrats have tried repeatedly is that it leaves no room for compromise or agreement on common points – making immigration reform a loss-loss proposition. Republicans are likely to be open to some form of undocumented resident legalization and will certainly support many parts of Biden's proposals on skilled immigration. For example, if Biden agrees to postpone discussions about granting citizenship to undocumented residents in exchange for a 10-year visa, it might be palatable to the majority of Republicans. A starting visa would also be a slam dunk. Both parties could even arrange permanent residence for unauthorized immigrants who entered the US as minors, sometimes referred to as "dreamers" – based on the never-passed DREAM Act. However, Congress will only reach an agreement if these issues are unpacked and not combined into an all-or-nothing package as in previous failed reform attempts.
As the global demand for valuable talent increases, skilled immigrants are already turning away. The United States will never regain such talent if it does not attract it now. The UK recently launched a blanket citizenship offer to Hong Kong citizens, a brilliant move to attract the best of a skilled and well-educated workforce. China aggressively recruits expatriates and ethnic Chinese who are foreigners to emigrate and start businesses. After four years of bashing immigrants, the United States needs to send a strong signal to immigrant students, researchers, and founders that they are still welcome in this corner of the world. There is no better way to roll out the welcome mat than to make it easier for immigrants looking to study, work, and start businesses to get to where people have always come to make their dreams come true and make a name for themselves: the United States.