In the midst of all the doom and gloom for foreigners in the US regarding real Immigration reform and just general fairness from the US Immigration System, Congress and the media, a small hope has emerged. Democrat Senators Mark Warner and Chris Coons along with Republican Senators Marco Rubio and Jerry Moran have come together to put forward Startup Act 2.0.
The general purpose of this legislation is to make it fairer and easier for foreigners to start companies and create jobs mainly for US citizens, get green cards and permanency in the US and ultimately keep the US at the forefront of global innovation and technology.
Why Is This Important?
– 40% of Fortune 500 Companies were founded by either immigrants or their children. This covers millions of American Jobs, many billions in US wealth and 1.7 trillion dollars in revenue with huge amount of tax dollars flowing to Federal/State/Local governments for the benefit of all. These include many of the most well known global brands including; IBM, Intel, Google, Paypal, Apple, Yahoo, eBay, Budweiser, GE, McDonalds, Colgate, etc. It is so large that the wealth created by these foreign born entrepreneurs in the US is greater than the GDP of all other countries in the world bar China and Japan.
– Almost half of the Top 50 Venture Backed private companies in the US have at least one immigrant co-founder. On top of that 74% had immigrants in top executive positions and these companies on average created 150 jobs which of course was mostly filld by Americans
So What Is The Problem
Quite simply it is Politics. And it is from all sides. We have highlighted in the past how Iowa Republican Senator Chuck Grassley and Illinois Demoractic Senator Dick Durbin tried to create a bill to further curb foreign work visas in a blatent attempt to deflect blame for a flaying US economy and job market onto an easy (and non voting) segment of the community. Beyond that the Republican attempts to heighten tensions of their base via the illegal immigrant invasion (even though numbers have been falling, deportations rising and net losses of these types of immigrants in recent years) combined with Democratic attempts to placate unions and old ways of doing things in an increasing globalized world has meant ultimately the American populace is suffering most.
Imagine if all or some of the above brands were not headquartered in the US but in India, China, South Korea, Brazil, etc. how many jobs directly and indirectly would be lost in the US, how far down tax revenues would be, the increase to the US Trade deficit, lowering of US GDP, technology leadership and ultimately global power. Most people reading this now either use regularly one or more of the services above and/or work, have worked or know someone who does work at one or more of those brands.
Startup Act 2.0
The Startup Act 2.0 proposes;
– A new STEM (Science, Technology, Engineering & Math) Visa so foreign graduate of US universities with a masters or PhD level degree in these fields can receive a green card to stay in the country
– An Entrepreneurs Visa for legal immigrants so they can start business that must employ American citizens
– An elimination of the per country caps for Immigrant visas allowing faster processing for certain high volume countries like China & India (Although as we have discussed before with current overall caps this still does not address huge overall backlogs and probably will cause increases in wait times for other countries unless the overall cap is increased)
The Act also addresses areas that encourage investment into these companies, tax credits for R&D and offsetting early year obligations as well as lowering of overall tax rates.
Ultimately this Act will help address some areas of US Immigration that badly reform and speaks to something that has a bipartisan chance of passing US congress as it directly relates to jobs and avoids areas such as Illegal Immigration, The Dream Act, H-1B Visa Reform & Current Visa Quotas which tend to be more highly politicized but ultimately a huge problem for the US.
Cj