
Michael Moritz on immigration reform - vj44
http://sequoiacapital.tumblr.com/post/41716630960/immigration-reform-stop-ejecting-the-brightest-minds
======
rayiner
Newsflash: tech industry investor wants immigration reform to increase supply
of labor with tech skills, thereby decreasing cost.

Whether you're for immigration reform or not, let's not ignore the Econ 101
here, and let's call a spade a spade. There is no such thing as a "shortage of
engineers." The state and federal governments have spent literally a hundred
years subsidizing the technology industry by building massive public research
universities that pump out thousands of engineers each year. My alma mater
(Georgia Tech) is precisely one such institution. When companies talk about a
"shortage of engineers" what they mean is that there is a shortage of people
willing to work as engineers at the prices they would like to pay. Of course,
it's Econ 101 that if they raised the prices they were willing to pay, the
number of willing suppliers would go up.

I'm actually in favor of skilled immigration. My dad was an H1-B, and I have
very bright friends who came here to study and struggled to get sponsorship.
However, claiming that anyone who opposes the status quo is simply xenophobic
is disingenuous. Let's not pretend that there isn't a trade-off between
limiting labor supply to maintain wages and expanding it to make the U.S. a
more attractive place to start a technology company.

It is the people of the United States that defend our borders, and it is
therefore the right of those people to decide who gets in those borders and
who does not. The people are entitled to decide for themselves what kind of
trade-offs they want to make re: immigration, based on what benefits them the
most. One can make a credible case that the U.S. is in danger of losing it's
place as an attractive place to start a technology company if we don't allow
more skilled immigrants. One can also make a credible case, without any
xenophobia necessary, that we already do a lot to create a large supply of
engineers in this country, and that the U.S. is not in any danger of losing
it's attractiveness at the moment, and that we'd rather enjoy the higher wages
that come from limiting the labor pool.

~~~
d2vid
Econ 101 also distinguishes between elastic and inelastic supply. Engineering
labor supply seems pretty inelastic - doubling engineering salaries might only
raise supply 5% (some students switch majors, some engineers choose to work
more hours or retire later). That is the definition of a shortage - there is
not enough at any price.

~~~
drpgq
That seems a pretty bold claim to make that doubling salaries would only raise
supply by 5%. During the tech bubble people were coming out of every nook and
cranny imaginable.

~~~
Volpe
Yeah... but they weren't producing anything, which caused the crash.

~~~
muzz
No, what caused the crash was that there was no bigger fool to sell overvalued
stock to. Engineers coming out of the woodwork were simply responding to the
economic incentives that existed for them (and that's the problem with
bubbles, it's that incentives get distorted).

------
twoodfin
I don't think it's xenophobia that's preventing us from "stapling a green card
to every diploma," as Mitt Romney put it while advocating for the idea. Making
immigration easier for educated workers is popular and has fairly broad
bipartisan support.

So why hasn't it happened? Many of those in favor of a "comprehensive"
solution are wary of letting the most popular parts of immigration reform pass
individually, lest they end up with the less popular remainder (some form of
normalization for existing undocumented immigrants) standing on its own and
thus harder to pass. Similar logic worked against passing a real "DREAM" act
prior to the President's somewhat dubious selective-enforcement scheme.

Relatedly, there's a strong feeling among some reform advocates that focusing
on skilled labor from Europe or Asia at the expense of unskilled labor from
Central and South America is yet another example of discrimination and at
least metaphorical fence building. Why help those who are already well off
enough to get a college degree in the U.S.?

~~~
mpyne
One other factor is the preceived threat of wage imbalances acting against
U.S. non-naturalized citizens ("We'll be flooded with H1B's who will work for
25% less and undercut our sons and daughters!"). I'm not sure how much of an
issue this actually is in practice but it's definitely something to think
about, especially before we start stapling green cards to diplomas.

> Why help those who are already well off enough to get a college degree in
> the U.S.?

You answered your own question. It's about skills, not how much money the
immigrant already possesses. The proof is in how famous India is for sending
over tech entrepreneurs, despite being otherwise maligned by stereotype in
many of the same ways that those from Central and South America are. They are
able to come over and work here in the U.S. because they possess skills which
are desired.

If you look at immigration practice as being simply that anyone who wants to
come to America and work hard should get a fair chance, then that is probably
unfair. But there are those who argue that we should be selective and
prioritize towards those who would contribute most.

But I suppose all of this just adds to your argument that there's many
competing factors in play here, even for a topic as obvious as this.

~~~
twoodfin
Just to be clear, I am in favor of substantial increases in skilled
immigration, as well as shortening the visa->green card->citizenship route as
much as is practical for those who have a clear capacity to contribute to our
society and express a desire to do so as citizens. I'm only trying to explain
some of the politics as I understand them.

 _One other factor is the preceived threat of wage imbalances acting against
U.S. non-naturalized citizens ("We'll be flooded with H1B's who will work for
25% less and undercut our sons and daughters!")._

I suspect that the "keep your job or you're gone" nature of H1B visas creates
much more downward pressure on wages than increasing the supply of skilled
workers does. Regardless, we want growth in industries that require skilled
workers. I'd rather have 5 million software engineers in this country making
$80K on average than 3 million making $100K.

 _But there are those who argue that we should be selective and prioritize
towards those who would contribute most._

I can see the other side's argument about fairness, but to me it's a slam dunk
that you invite in people that are likely to produce economically a large
multiple of what they consume in benefits. I'm happy to figure out what to do
about unskilled labor, too, but coupling the two seems counterproductive.

------
isalmon
Everybody who supports this bill should really read it first. There's SO much
wrong about this bill that I don't even know where to start.

1) This bill will remove per-country quotas for Employment Based Green Cards.
Just look at the backlog right now and imagine what would happen if these
quotas were removed.

2) The cost of applying for H-1b will be INCREASED. What that means is that
small companies and start-ups who struggle with hiring engineers will have to
pay more for each one of them. It used to be 2-3K/application and for a small
company it might be pretty substantial. At the same time companies like Wipro
and Infosys will not even notice this increase.

3) The bill does not really help people who graduated here to STAY in the US.
Yes, it will make it easier for them to get a visa, but what they really need
is their green card. I was on H-1b for many years and the only thing I wanted
during these years is to get my green card ASAP and start my own business.

Take a look at Canada's startup visa that just was introduced. They bring new
jobs to Canada by giving permanent residency to people who want to start
businesses and CREATE jobs (not take the existing ones). Current US bill will
NOT allow entrepreneurs to stay in the US, it will only help to bring more
cheap labor from overseas, but will not solve the problem of talented people
leaving the country.

~~~
therandomguy
You are encouraging people to read it first... but then you say it provides
only visas and not green cards while the text says, "...Overhauling the
country's legal immigration system, including attaching green cards to
advanced degrees...". What gives? <http://goo.gl/MZuod>

~~~
isalmon
That's a totally different bill... Which, by the way, is even worse.

------
Torgo
I don't think I could even count how many contractors I've worked with that
were on H1-B's and yet were doing basic Struts and Dreamweaver code monkey
work for my place of employment. Work so basic that it doesn't even need a
software engineering or computer science degree. I have absolutely no idea if
we have a shortage of "highly skilled" workers, but I've seen with my own eyes
that H1-Bs are abused for work that definitely could be done by a citizen. So
I'm not inclined at all to be sympathetic to the call for more H1-B's that
will lead to just as much abuse, and leave the same shortage of actually
highly skilled workers.

------
programnature
I support this reform, but we should consider the unintended consequences.

Tying US citizenship with graduate work will incentivize universities to treat
graduate students like slave labor, moreso than they are already. This is a
recipe for exploitation.

~~~
blizkreeg
There is an unintended consequence for everything, including inaction.

~~~
programnature
That kind of reasoning is what got us into Iraq.

I'm simply suggesting thinking through the consequences rather than simply
cheerleading.

For example, would we be comfortable with 90% of science students being not
from the US?

What if we make a system where no one born in this country can actually afford
to do graduate work?

Remember, the foreign-born students don't have the kind of undergrad debt load
that we have in the US.

~~~
blizkreeg
You are so, so misguided in your thoughts. I came to this country for graduate
studies and took on a loan for a portion of it, amounting to almost $20K. Took
me the better part of 2 yrs to pay it back. I came from a modest family
background. While I didn't have an undergrad loan, I certainly didn't have any
money to back me up.

Most foreigners grow up with far fewer resources than you did in this country.
The USD is still stronger than 99% of currencies. While I don't dispute that
college education is ridiculously overpriced here, that is a different,
unrelated problem.

~~~
programnature
This is not about you, this is about what is good for the country.

Is it good for the country to disincentivize graduate work for people who are
born here?

Is it good for the country for every STEM lecturer to have bad english
language skills?

This is already the norm at many state schools, and makes people drop those
subjects because they can't understand or relate to their teachers.

Of course it is hard for immigrants to relate to the spoiled "fat" americans,
but the social and cultural realities exist and are not trivial.

------
MattGrommes
"Stripe’s engineering department would be at least twice as large if we could
get working papers for the programmers we are eager to hire."

It looks like Stripe has decided hiring foreign workers is the only solution
to the problem instead of trying to find another solution. There are _plenty_
of good programmers who could work for Stripe in the US, maybe they just
aren't attracted to the company, to living in SF, don't know about the
company, etc. Maybe they should think about their hiring process more
generally rather than waiting on hiring some particular group.

~~~
pc
"It looks like Stripe has decided hiring foreign workers is the only solution
to the problem instead of trying to find another solution."

That makes no sense. Hiring people from outside the US is harder, slower, and
more expensive than hiring US citizens.

We just care a lot about working with the best people, and we're willing to
spend months obtaining visas for them in order to do that.

~~~
jquery
What do you mean by the "best" people? Are there not people in the USA that
would work for you, who fit your qualifications? If they won't, why not? Think
about it, stop trying to fool us with your red herring about wanting the
"best". What you really want is the "best" at prices competitive with the
"average" American. One might almost think you were getting them for cheap.
_Hmm_

~~~
enraged_camel
"Hiring foreign workers for cheap" is a myth. The US Labor Department has
specific laws that it strongly enforces to ensure foreign workers cannot be
hired below market rates.

~~~
jquery
You know how they get around this, right? They simply change the title. I.e.,
they hire a senior engineer and slap them with a mid-level title. If you
haven't seen that happen, you haven't been paying attention. There's also the
more important and salient benefit of hiring H1-Bs--the strong bond it creates
between the employee and their visa status. You'd have to pay a US citizen
much more to make them sign such an onerous and one-sided contract.

------
tokenadult
The unintended consequence I most fear from this kind of immigration law
modification is the same unintended consequence I've observed from every
attempt to tie real-world advantages to diplomas: watering down the diplomas.
The blog post author writes, "It would be wonderful to provide foreign-born
students with advanced degrees in STEM subjects from U.S. universities a clear
path to permanent residency." From the lawyer's point of view, the interesting
questions then follow. What is a foreign-born student? What is an advanced
degree? What is a STEM subject? What is a clear path to permanent residency?

I by no means oppose expansion of skills-based grounds for legal immigration
to the United States. Mindful that all of my own ancestors arrived to the
United States (or to the pre-independence colonies of Britain) in an era
before there were any restrictions at all on immigration here, I'm generally
quite supportive of expanded immigration to the United States. That improves
the local cuisine, the local music, and the local economy in general. Mindful
that my wife was able to find a legal channel for immigration to the United
States (based on that status of being my wife, in that case) and that many of
my friends and neighbors are first-generation immigrants to the United States,
I am also aware that there quite a few channels to legal immigration to the
United States already, some of which already strongly favor people with STEM
degrees or STEM work experience. I'd be glad to see more people like that come
into the country--that would be good for my personal local business of
teaching mathematics to the children of people who are aware United States
K-12 education underperforms (see my user profile for more details on that).
But the tricky issue will be setting detailed criteria for immigration on
those grounds and perhaps (or perhaps not) an annual number of visas issued on
those grounds that fit an overall sound immigration policy for the United
States.

Anyone who doesn't think a simple policy proposal like that of the blog post
kindly submitted here might be subject to abuse and fraud needs to think
again. Immigration to the United States is very highly desired, and some
people will cheat to attain it. There is no particular reason for United
States voters to vote to make immigration any easier than it has to be to
achieve some generally agreed national policy goal, despite own my pro-
immigration opinions.

~~~
jadc
I am sure you are not advocating a defeatist line of reasoning. Of course, any
proposal could be subject to abuse and fraud. It is a matter though of moving
things in the right direction or not.

As to the questions you raise about how to define the requirements (what is
foreign-born national, what is advanced degree, what is STEM), a possible
start is the current "advanced degree exemption" for H1-B which currently
grants an additional 20,000 H1-B visas.

I am aware that those get filled up pretty quickly too but it illustrates my
point that you can define some sort of requirements to answer the questions
you raise. In this case, the requirements are: \- degree must be from
accredited US university/institution \- master's degree or higher \- foreign
national (which is different than foreign-born national) is anyone who is not
a US citizen or permanent resident

------
jpdoctor
> _Today, it is impossible to satisfy Silicon Valley’s appetite for engineers
> and scientists with people born in America._

Well, at the price you're willing to pay anyway. Try competing with banker
bonuses (or even _gasp_ VC pay) and watch the population shift.

Sounds like he's all for capitalism until he has to open his own wallet.

~~~
enraged_camel
Wait, are you suggesting that software engineers currently do not make enough
money (which is laughable), or that they should be paid as much as bankers
(which is also laughable)?

~~~
jpdoctor
Laughable?

There is a shortage. A capitalist believes that price solves supply issues.
Are you not capitalist? Do you prefer a centralized planning, say from a gov't
program to import people?

~~~
enraged_camel
There is a shortage of available engineers, period. It's not a matter of
companies not paying enough.

------
greghinch
Meanwhile many of our locally born students are graduating with unemployable
degrees and wondering why they can't find a job. Maybe we can get our acts
together and start raising children in this country who aren't under the
delusion that everything they do is special, and that a degree in Sumerian
with a minor in communications will entitle them to anything other than a pile
of student loan debt.

~~~
eshvk
I dunno. I went to school in India where almost everyone is shoehorned into
the Engineering/Medical undergrad career. While, I don't think it is
particular hard to not succeed at these professions, I am not convinced it is
a good thing to do just because it is an economically prudent option.
Sometimes, the purpose of going to school is to open the mind and expose it to
different ideals. Maybe I am being a naive optimist but I would like to think
that we can surely let some of the citizenry indulge in that without having to
force everyone to join a technical shop to create a factory ready worker (much
as is happening in India/China.).

~~~
greghinch
It's a fair point, and I agree we need to find a place for other academic
pursuits as well. I think the problem is we have been giving students the
impression that _any_ degree is worth getting, and that simply isn't true. A
bachelors in English from a liberal arts school is worth nothing. Now if you
want to extend that and do post-grad work, then you are actually making an
effort to persue a career in a field (probably academia). But too many just do
the undergrad and then expect a job.

------
ojbyrne
"In Silicon Valley, which has always been blind to any attribute other than
ability." I look at what laughably passes for management and leadership in the
valley, and wonder if anyone actually believes that anymore.

------
spikels
I find it hard to believe that it would be bad for the US overall to let
highly skilled people come here and work. They would increase innovation, grow
the economy and raise employment as immigrants have done throughout US
history.

However I have to admit it would probably reduce the wages of similarly
skilled existing workers at least in the short run. This is basic supply and
demand: more supply means lower prices at least in the short run.

For example would skilled US programmers be paid as much if any skilled
programmer in the world could come here compete for their job? Probably not
just look at the prices for contract programmers in India, Eastern Europe,
China, etc.

However in the long run almost everyone should be better off because the flip
side of lower prices is greater volume: more innovation, economics growth and
employment as well as lower prices. There are other less understood benefits
such as immigrants increased likelihood to start businesses.

Also in the long run it won't matter as much where people are located.
Eventually most US skilled workers will be competing with similarly skilled
workers throughout the world. So we might want to adapt to this future reality
now as it will only get harder in the future. People piling up student loans
need to know what future wages will be.

Overall I think we should be willing to take the risk and accept some
disruption now. It should help almost everyone in the long run and it will
happen in some form anyway. But I can understand people's reluctance to
personally bare the costs.

------
rdl
I'd be a bit concerned about the "American schools are not performing, and
getting worse, and thus Americans aren't suited to tech jobs" message,
politically, even if it is largely true. The us citizen voters who will lose
out (if they believe the economy is zero sum and of a fixed size) will think
foreign competition will hurt them as the primary effect, and thus will vote
against it.

~~~
rayiner
It's not even true.[1] "American schools are under-performing" is a bit of
truthiness used by demagogues on various sides to support one of the following
agendas:

1) discrediting the public education model

2) demanding more public money for educators

3) demanding more public money to subsidize employee training

[1] See: [http://super-economy.blogspot.com/2010/12/amazing-truth-
abou...](http://super-economy.blogspot.com/2010/12/amazing-truth-about-pisa-
scores-usa.html)

~~~
rdl
Yeah, I meant "even if the "us needs immigration message" is largely true",
not that the American schools underperforming message is true.

The thing is that immigration might increase supply, for a specific job, but
there's the complementary goods/etc. aspect to people with different skills in
entrepreneurial tech work, so it overall increases jobs available.

(I do think some US schools underperform, but the big funding disparities seem
to have been addressed. Demographics are a big thing, but it would still be
good to figure out causes of and correct the lower performance of various
minority groups, vs. just accepting it as natural)

~~~
rayiner
Note: I'm not accepting the performance of minority groups as "natural."
Rather, I don't think the problem lies with the education system.

------
smadaan
I have one question: from the perspective of a sincere, hard-working
individual who wishes to immigrate legally to the US, what hope is there if a
proven advanced degree or experience is not going to do it?

~~~
therandomguy
It is difficult only if you are from Indian or China.

------
bhauer
I've frequently discussed this, most often in dejected frustration among
friends and colleagues. My wife went through a Ph.D. program in electrical
engineering and 90% of her research group were foreign born. As native US
citizens ourselves, we did not suffer the desperate living conditions to which
Ph.D. students on a half- or quarter-RA subject themselves and their nascent
families. But we observed it plenty.

Many of her research colleagues were effectively deported (forced out of the
United States) after graduation if they could not find a firm willing to
sponsor them. Sponsorship is itself an exploitative and extremely costly
endeavor. Many small companies cannot afford it.

The situation seems to me a travesty from every angle I can conceive.

The author of this article paints the situation adequately, but I want to add
a few more points:

1\. Since many of the more xenophobic among us Americans are strongly
motivated by national defense, I find it especially important to paint the
following picture for their consumption: educating these bright minds in the
United States and then sending them packing may in fact exacerbate national
defense. Considering how many engineering students arrive to our universities
from nations we are fearful of (rightly or not) such as Iran and China, it
seems especially naive to educate their brightest to the pinnacle of our
ability and then send them home--especially since they want to stay here.

Similarly, if your aim is to keep your enemies weak (and again, I'm not saying
that's a good or bad thing, just that it may be what the more xenophobic among
us desire), then certainly creating a brain drain within their society serves
us at their expense.

2\. A commonplace misguided belief that economics is a zero-sum game may also
explain some xenophobia. This colloquially takes the flavor of, "they are
taking our jobs." The only way to combat this is through repeating the point
that immigration creates jobs. We as Americans are better off having these
highly-educated job-makers in America than overseas creating and enriching
companies that may end up competing with our own.

As a free-marketer, I am not all that motivated by such an "America over
everyone else" point of view, but if that IS your point of view, then again
you should want these bright people staying here and creating jobs or
bettering our firms rather than overseas in the hands of our competition.

3\. It's quite frankly inhumane in many cases to send these students packing.
Even in the relative squalor that they endure living, for example in Los
Angeles on mere hundreds of dollars a month, they still want to live here and
create a family here. The American dream exists in their eyes. Sometimes I
think of those who were sent back and wonder whatever became of them, but I
cut those thoughts short because no happiness comes from that.

4\. Just as a minor point, can you imagine the feeling of being kicked out of
the US after earning your Ph.D. here? I imagine it might breed a tinge of
America hatred when they get back home.

~~~
eshvk
> 4\. Just as a minor point, can you imagine the feeling of being kicked out
> of the US after earning your Ph.D. here? I imagine it might breed a tinge of
> America hatred when they get back home.

Erm...so? No offense, but someone could trip and get hit by an American made
automobile and develop a hatred for America. Not that you don't make other
valid points but this is not something that motivates anyone to support
immigration.

~~~
bhauer
I should clarify that I personally am not much motivated by a concern of
hatred of America overseas. But I know that many people are concerned about
our reputation, and I am attempting to formulate a point of view that they may
(or may not, I'm not sure) relate to.

Namely, that by kicking people out of our members-only club, we might be
breeding resentment. You're right, though, any number of other things could
contribute to the same.

------
muzz
One things conspicuously missing from the post is the idea that companies will
set up foreign offices to hire the workers there if they can't hire them here.
Maybe that idea died along with the whole outsourcing push of the mid-00s.

------
mynameishere
_The xenophobia underlying current immigration policy_

Absolute, shameless liar. <http://peoplemov.in/>

------
ekm2
The current immigration setup ensures that high skilled immigrants come into
the country only as employees which understandably depresses
salaries.Immigration reform on the other hand ensures that some of them have
the autonomy to found companies which increases demand for more engineers and
raises their salaries.

------
basiceconomics
Michael Moritz is a billionaire investor. It's easy to understand why he'd
like to increase the supply of technical labor in the US. This lowers his cost
of labor, contributing to his further enrichment.

Foreigners desirous of US citizenship similarly favor "immigration reform" for
self-interested reasons.

The marks here are American tech workers (and American workers in general) who
buy into various elite rationalizations for why labor needs a pay cut so
people like Moritz can pile up more billions.

~~~
pc86
It's generally considered poor form to create a novelty account just to
comment on a posting here.

