Analysis: The immigration gridlock has already hurt U.S. competitiveness and will worsen the damage if our political leaders don’t soon reach a compromise. The good news is that with the Republican Senate victory, immigration reform may finally have a chance, writes former Triangle tech entrepreneur turned academic and author Vivek Wadhwa. Wadhwa is a regular contributor to WRAL TechWire.
SAN FRANCISCO - After graduating from Wharton in 2007, Kunal Bahl wanted to become an entrepreneur. He couldn’t get a visa, so he had to return home to India. He started SnapDeal in February 2010 with the ambition of building India’s Groupon. Then he saw an even greater opportunity—to turn SnapDeal into India’s Amazon.com. Snapdeal already has more than 25 million customers and sells goods from 50,000 merchants. With the $625 million that Japan’s Softbank has just invested in it, it is surely on its way.
The sad part for America is that instead of creating jobs here—where he really wanted to be—Bahl created thousands of jobs in India. Bahl is no longer looking to U.S. companies as his model. His new goal is to build the Indian version of Alibaba, the innovative Chinese ecommerce marketplace, which enjoys market capitalization of $275 billion. As Alibaba’s founder, Jack Ma, is doing, Bahl is pondering which Silicon Valley companies to acquire. Over drinks at the INK conference in Mumbai on November 2, Bahl and I discussed the pros and cons of Snapdeal’s acquiring Groupon, which has market capitalization of around $5 billion. We agreed that there were better Silicon Valley companies to acquire—and that he should think bigger.
Gone are the days when the U.S. was the only land of opportunity and when entrepreneurs dreamed of being acquired by a Silicon Valley company. The bigger opportunities now lie in countries such as India, China, and Brazil, and their entrepreneurs are becoming confident that they can take on Silicon Valley. The world’s best and brightest students once came to study in the U.S. with the expectation of starting their careers and settling here. Now, upon graduation, they buy one-way tickets home.
The immigration gridlock has already hurt U.S. competitiveness and will worsen the damage if our political leaders don’t soon reach a compromise. The good news is that with the Republican Senate victory, immigration reform may finally have a chance.
Contrary to popular belief, it isn’t the Republicans who have been the barrier to skilled immigration, it is the Democrats—because they demanded all or nothing, without compromise. Rep. Luis V. Gutierrez (D., Ill.), chairman of the Immigration Task Force of the Congressional Hispanic Caucus, confirmed this to me in an online debate. He insisted that his party would not agree to increase the numbers of visas for skilled workers unless the Republicans agreed to legalize the more than 10 million immigrants who are in the country without documentation. To make matters worse, the Democrats insisted on a path to citizenship for the undocumented, and this turned the legislation into a poison pill that the Republicans simply would not swallow.
What the President needs to do now is to end the stalemate. He needs to support smaller pieces of legislation on matters in which the parties are in agreement. He shouldn’t poison the waters further with tactical executive orders that put Band-Aids on the immigration mess; he should carve immigration up into pieces that are debated on their individual merits. Agreement is possible.
Both sides realize the importance of having more technology companies, so legislation such as the Startup Visa Act should be a no-brainer. It will allow entrepreneurs such as Kunal Bahl to start their companies in the U.S. and create local jobs. There is as well broad support for providing permanent-resident visas to science, technology, engineering, and mathematics graduates. And then there is the issue of H1B visas for experienced engineers, doctors, and scientists. If abuse of the system can be curbed, there will be broad support for expanding the numbers of visas.
The Startup Visa alone could create as many as 1.6 million jobs and boost the nation’s annual gross domestic product by 1.6 percent within 10 years, according to the Kauffman Foundation’s estimate. Providing permanent resident visas to the more than one million people who are stuck in immigration limbo will allow them to buy houses and invest in their communities. Increasing the numbers of H1Bs will help to alleviate the shortage of doctors in some parts of the U.S. and allow Silicon Valley to hire the talent it desperately needs.
The most contentious debates are over the plight of the undocumented, low-skilled workers. The Republicans and Democrats have both, in the past, supported the DREAM Act—which provides basic human rights to the millions of undocumented children who live in the shadows of U.S. society. If presented with stand-alone legislation, the majority of our political leaders would surely support this. As well, both sides agree that it is impractical to deport 10 million undocumented immigrants.
Compromises are possible, for example, with a new visa class that allows these people to stay in the U.S. legally, pay taxes, and return home when they need to. The issue of citizenship could be deferred for a few years until the wounds of the immigration battles have healed and Americans can reach for consensus on what is right and what is wrong. The immediate outcome for America and Americans in general will be very beneficial.
It’s time for the political quagmire and stalemate to give way to compromise and good governance. Immigration reform surely cannot wait. President Obama should turn his party’s Senate defeat into a victory for America.
(C) Vivek Wadhwa