Tag Archives: immigration policy

The State of US Immigration 2013


Recently we did an article about “Why we need US Immigration Reform in 11 Charts” which eloquently talked about what we had identified as the 13 broken areas of US Immigration that needed to be fixed for true US Immigration reform and which was to a decent degree addressed at least in the initial version of the US Immigration Bill submitted to the US Senate in April 2013.

In those 11 charts we talked about how;

– Each month foreigners start more businesses than US born Citizens
– Foreigners earn patents for their work at 3x rate of US born Citizens
– Immigrants contribute far more in taxes than they receive in benefits
– US only issues 13% of all visas to Skilled Immigrants which is even lower than 20 years ago

Since then luminaries such as Bill Gates, Vivek Wadhwa, Mark Zuckerberg via his Fwd.us SuperPAC and led by the Obama White House have pressed the need for Immigration reform for the US Economy at large. The latest entrant to this list, albeit a constant advocate for US Immigration reform is Mary Meeker.

Mary Meeker came to fame in her Morgan Stanley days in the 90s backing many of the Internet heavyweights we take for granted today. Later on in her time there and now in her current role as a partner and head of a large fund at Silicon Valley Venture Capital giant, Kleiner Perkins Caulfield Byers (KPCB) she is covered extensively in the media because of her annual State of the Internet reports which she releases with colleague, Liang Wu and can be dowloaded here. In her latest State of the Internet 2013 report she actually devoted a portion of it to the need for Immigration reform and how it is hurting US technology and economic prospects today and into the future. Then separately for the first time she devoted a separate presentation to “Immigration in America & The Growing Shortage of High-Skilled Workers“. It is actually something we also talked about way back in 2009 with US Immigration & Education Policy and according to Meeker and Wu’s latest research the problem is only accelerating.

One quote they include is a famous one from President Ronald Reagan in 1988;

“You can go to live in France, but you cannot become a Frenchman. You can go to live in Germany or Turkey or Japan, but you cannot become a German, a Turk, or a Japanese. But anyone, from any corner of the Earth, can come to live in America and become an American.”

Now the world has changed a lot in the last 25 years since this was made and become increasing more global and there is probably a couple of other countries in addition to the US that you could include in this list, namely Canada, New Zealand and Australia where any immigrant can become a local. However the statement is very true when it comes to the essence of the US and she uses that as a sad state of affairs today with US Immigration policy being more akin to the other countries of the world who are more hostile to immigrants ever being anything more than visitors our outsiders no matter how they may live in a given country.

The chart below shows US Immigration as a snapshot in 2010 to highlight the false rhetoric and the total missing of the point not to mention factual errors in most US Immigration debates. As can be seen only 1% of total US population is High Skilled Immigrants and that is only 10% of the total 40M Immigrants currently in the US. Therefore all the debate about skilled immigrants taking US jobs and too many visas is completely false and in two of our most recent posts covering Green Card Salaries and Foreign Immigrant Salaries we also show that for the most part these immigrants are commanding salaries commensurate with being highly educated and thus paying a lot of taxes.

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The other two visuals we wanted to highlight from their excellent analysis come from who actually has founded the great American companies and just how much wealth and jobs that has meant directly (not including indirect jobs) for the US Economy.

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In short 4.5 Trillion dollars or 30% of total US GDP is the result of immigrants and to put that in perspective that is about the equivalent of the entire GDP of Latin America, Japan or India today. In fact according to the 2011 “New American” study in 2011 cited in the report, 7 of the 10 most recognized and valuable global brands were founded by 1st or 2nd generation immigrants to the US. This includes; GE, AT&T, IBM, Google, Marlboro, Apple and McDonalds.

Ultimately I hope this report educates you personally and your discussions with your social circles and ultimates helps influence the way you assess all levels of elected officials when they are truly talking about the future innovation and prosperity of America.

Cj

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US Immigration Reform: Why The Future is Bleak for Foreigners (and ultimately all Americans)

We often get asked here why things never seem to change in terms of US Immigration Reform and thus why we continue to have situations like;

– High Skilled Immigrants waiting for over 10 years in Waiting Lists to get their Green Card
Foreigners forced to stay in same jobs and forgo promotions, new jobs, help innovation and pay increases for 10+ years (and thus allowing critics to say foreigners are depressing wages)
– Companies like Microsoft are forced to open their R&D innovation center across the border in Canada where the skilled immigration laws are logical (therefore lost tax revenue for the US and less US jobs)
52% of Silicon Valley Companies have at least one immigrant co-founder employing hundreds of thousands of Americans and contribute billions of tax dollars to all Americans (inc. Google, Intel, Facebook, Yahoo, eBay, Paypal, etc.) yet we are forcing these companies to now base themselves overseas
– 84% of the Green Cards issues each year are for family and diversity reasons with only 16% awarded to high skilled talent (this compares poorly with countries like Canada, Australia, etc. where most permanent residents are high skilled talent)
– Thousands of dollars, long application processing periods and illogical visa criteria mean that foreigners constantly live in a state of fear in US
Illegal Immigration continue to remain an issue with no practical solution ever proposed and implemented and thus the issue of Legal Immigration continues to be pushed back

Vivek Wadhwa, who we often reference here has written a piece for the Washington Post about by Americans are so afraid of Immigrants. The reality is that this anti Immigrant sentiment in the US has existed throughout its history, it is just that the target group has changed. The Irish, Africans, Germans, Italians, Russians, Japanese and Jews were all big targets in days gone by for harsh treatment, bad feeling and sometimes actual law prohibiting them doing things. Today it is the Indians & Chinese that largely feel the brunt of anti immigrant sentiment on the legal side and Mexicans on the illegal side.

If you read Mr Wadhwa’s column and the comments underneath as well as watch the video there you will realize why this issue has no end in sight despite what President Obama and Republican Presidential nominee Mitt Romney may say in this Presidential year. Public sentiment in the US in this bad economic period regarding Immigration is low on both sides. There are loud anti-immigrant voices on both sides. On one hand on the right just so myopically focussed on building fence on the southern border and deporting any illegal in site. Then on the left unions and other workers blaming immigrants for their own bleak economic predicaments rather than the American politicians, American CEOs of bankrupt, bailed out and major layoff companies and the wider American populace for running up huge debt.

From a politicians perspective, Immigrants are never a constituency they have to worry too much about because they can’t vote. Generally it is half measure like President Obama’s recent directive to de-prioritize deportation of low risk illegal immigrants (i.e. children) to appeal to the large Latino populace in the country who are often friends and family of these illegal immigrants particularly in important swing states like Florida, New Mexico, Nevada and Colorado. There were 400,000 immigrants deported in 2011, mainly of Hispanic descent and this was clearly a politically motivated decision in terms of timing in an election year.

Because of the medium term benefit of having a pro skilled immigration policy being years in advance (i.e. Sergei Brin studies for 4 years at Stamford, co-founds Google in 1996 which goes public in 2004) not fitting into with the 2-6 year cycle of electing Congressmen, Senators and Presidents, the political will is also low.

While it is the Immigrants who pay the initial price for the status quo and Immigration reform inaction, it is ultimately all Americans that will feel the  brunt of the terrible policies of today. However if you are an Immigrant in the US today continue to persevere in your dream to live in the US regardless of the tough journey that lays ahead. Know that there are thousands of people going through exactly what you are experiencing, having the same questions and fears and enduring the same frustrations and anger that you have each day.

There is small pockets of movements in more modern companies looking at a more egalitarian approach to employment and actively learning more about foreign immigration rules. Hopefully more of these companies and leaders become the giants of tomorrow and are able to effect change. Although Bill Gates and Warren Buffet are huge advocates of much greater foreign immigration for prosperity in the US and even their considerable power and influence hasn’t changed much.

Cj

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