

Immigration reform in America - denzil_correa
http://www.economist.com/blogs/democracyinamerica/2013/04/immigration-reform-0?fsrc=scn/fb/wl/bl/forwardmarch

======
davidf18
It is a means of lowering wage rates among engineers and software developers.
Rich for Zuckerberg, with > $10 billion in wealth created by those engineers
and software developers to want to lower their wages even further.

Of all the top large technical companies (Microsoft, Apple, Google, Oracle,
Intel, Facebook, ...) only Google has a major presence in Manhattan (in
Chelsea) for software developers and engineers (it owns the second largest
office building in New York City). If Zuckerberg and friends would read a some
of Richard Florida, he'd find that young people don't want to live in boring
Silicon Valley (many take a long daily commute from SF) but rather in places
like Manhattan. Disclosure: I live in Manhattan

Lowering the wage rate is not the best way to get technical talent. The best
way to do as Google has done and go to where a lot of smart, enterprising
people want to live.

~~~
objclxt
> _It is a means of lowering wage rates among engineers and software
> developers_

You might think Mark Zuckerberg is in this to bring in international
developers and pay them peanuts, but the reality is that most people Google,
Facebook, and the like are bringing in on H-1B visas are extremely well
compensated, on a par with their US counterparts. Once you account for
relocations packages and visa/legal fees (which alone can top $10k) it's often
more expensive.

Yes, some companies take advantage of international workers. I don't dispute
that. But many people who want to enter the US are losing out - they have
great job offers, and end up being slaves to an arbitrary lottery with a
fairly meaningless cap in the grand scale of total US immigration.

~~~
davidf18
Econ 101: importing labor reduces "scarcity" driving down prices, regardless
of paying going rate. It simply keeps rates from going up which would bring
more Americans into the "silicon valley" tech labor pool.

See Tim Harford's "Undercover Economist" for TL;DR style of understanding
economics: <http://www.amazon.com/gp/product/B007NIDW1Q/>

If Zuckerberg's is trying to satisfy a labor shortage then he should go to
where the labor wants to live, as Google has done which is to establish a
major technical presence in Manhattan, where the kind of people he wishes to
hire want to live.

~~~
potatolicious
Facebook has a substantial (and expanding) presence in NYC. As does Amazon and
various other "tier 1" tech companies. Tech presence in NYC is exploding in no
small part due to Californian (and abroad) companies trying to tap into the
local talent pool.

While you're condescendingly lecturing others on basic economics, I'd suggest
you brush up on what's going on in the tech scene in your own back yard.

Your understanding of economics is also overly simplistic and fails to account
for the _utility_ of the good or service being sold. Reduction in supply only
raises prices if the utility of what's being traded is infinite and there are
no substitutes.

While there are notable outliers in the tech industry in terms of profit per
employee, most software businesses are firmly in the $200-300K range when it
comes to revenue per head. This represents the upper bound of how much someone
can get paid and still make sense - and both NYC and SF/Bay salaries are
already a substantial portion of this figure.

A reduction in supply will only result in a rise in salaries until you hit
this revenue cap. A _continued_ reduction in supply past this point will
result in companies going under as they cannot fulfill labor needs at a price
they can afford. This becomes a net negative for the tech industry as the only
businesses continuing to employ engineers will be the extreme outliers who can
generate highly abnormal revenue numbers per employee. Startup costs will also
blow through the roof as the amount of capital required to get a business off
the ground explodes. The entire industry suffers as _overall employment_
drops.

It's frustrating how many people in our field live in a fantasy land where
squeezing hard on the supply side will mean they get rich.

> _"where the kind of people he wishes to hire want to live."_

This statement requires more elaboration. I'm in Manhattan, but I also
understand that not everyone is like me. To claim that the type of software
talent companies are looking for are _inevitably_ urban is entirely misguided.
There is no shortage of talented techies who would love nothing more than a
house, a lawn, a car, and surfing on weekends.

NYC contains a certain demographic of talent that absolutely refuses to live
anywhere else - and anyone has the capability would be well-advised to try to
tap into it, but it is not the only demographic worth courting.

This may seem obvious to outsiders but bears repeating sometimes in the city:
New York City, and the "type" of people who live there, is not the center of
the universe.

~~~
davidf18
When you quote $200 to $300K revenue per head, you are quoting averages,
whereas the firms I quoted (and also say, Qualcomm) earn have greater revenues
per head and Facebook is about $1 million _per employee_.

Google has a 3 million square foot building in Manhattan which they purchased
for $2 billion. I'm sorry but I don't see Microsoft, Oracle, Apple, Amazon, or
any other tech firm making anywhere near that commitment.

Of course, not everyone wants to live in Manhattan and I never said that, but
as Google has demonstrated, it should be the second place after SV that you
want to have a major presence. There are a lot of extremely intelligent high
value employees and networks there. It is also a best place for employees to
be that want to improve their careers esp if it overlaps with media, finance,
health care delivery, pharma, ...

BTW, I don't make my money as a software or hardware engineer but once worked
in both fields. I _do_ believe, with the exception of Google, that Goldman and
other top tier finance firms have been brighter than many of the SV firms that
have only made a small presence in NYC.

------
nostromo
I heard an interesting idea recently: auction off immigration slots. (Not all
of them, just a large subset.)

Employers looking to hire talented individuals from abroad would most commonly
foot the bill.

There are some cool things about this solution: it raises money for the US
Government, it determines who will most likely be a high-value contributor to
the economy, and it raises the cost of foreign workers (to balance the
interest of American workers).

~~~
objclxt
It has been pointed out here before that this would significantly disadvantage
both start-ups and small companies who may be working in extremely niche
environments and require talent from abroad.

~~~
WildUtah
That's not true at all.

Auctioning off worker visas would make it possible for startups to hire
talented people and to being co-founders to work together in the USA for a
cash price. Today, startups are almost completely prevented from using H1 and
L1/2 visas because of the paperwork requirements and because CIS examiners
choose to assign those visas only to established companies.

The established companies in question usually pay millions and millions to
hire the first tech worker because they have to set up a legal department that
can deal with the obsolete, contradictory, byzantine, and nonsensical
requirements of the law and CIS bureaucracy. Then each tech worker after the
first costs only the application fee and salary of the worker.

The high initial cost eliminates startups while the low marginal cost for
additional workers means InfoSys and WiPro can fill the quota with low wage,
low profit per seat CRUD developers. It's the worst of both worlds.

Startups could easily outbid the body shops for a single talented programmer
or founder if each visa were up for bid. Also, the cost would be much, much
lower than today's system where you need to hire lawyers to lie for you (yes,
it is required to lie; the law as written contradicts basic economic facts).

It's time to put this foolishness to rest: putting tech worker visas up to bid
would be good for tech workers, good for startups, good for R&D focused
companies, and good for the government budget. It would not be good for cheap
body shops that depend on low-wage no-rights workers.

~~~
ojbyrne
My H1B was applied for by a company with ~ 15 employees, and i was their first
non-American employee. There was no legal "department." They hired an
immigration lawyer. I would guess it cost in the low tens of thousands, not
"millions and millions."

------
volandovengo
The challenge with the US is that all talk of immigration focusses on illegal
immigrants, rather than highly skilled and educated immigrants.

It's unfortunate that the Obama administration won't separate these two kinds
of immigrants since they fear in doing so, they won't be able to get
comprehensive immigration reform passed.

Other countries recognize the value of highly educated immigrants who want to
create companies. Canada, for example, just announced it's startup visa
specifically targeting immigrants who want to move to the country to start a
company.

[http://www.theverge.com/2013/4/1/4170022/canada-startup-
visa...](http://www.theverge.com/2013/4/1/4170022/canada-startup-visa-program-
challenges-silicon-valley-immigration)

~~~
krschultz
Negotiating 101 is to always try and do the whole thing at once rather than
piecemeal. If you do the parts that everyone agrees to, there's nothing in
common to build around for the hard stuff later.

Also in general, just doing the popular stuff leads to big problems later
(that's how we ended up with low taxes and high spending, nobody wants to do
either of the hard parts of balancing a budget).

------
dllthomas
Massive immigration will help make sure I get my social security...

~~~
klrr
Well, they want to make it easier for companies to get good working power, not
allow people come and "steal" your benefits.

~~~
dllthomas
I think you read me as saying the opposite of what I was saying. The biggest
problem with entitlements in the current environment is that the
younger/working population is shrinking relative to the older/retiring
population. Opening the borders means more younger workers coming, and
probably having more children, who'll be "paying for my social security."

Of course, the comment was jokingly flippant - it's not really a good reason
to throw the borders open, though there are certainly more serious arguments
on both sides of that debate.

~~~
stephengillie
Social security is built on a population bubble. Like the housing bubble, we
can't expect it to last.

~~~
dllthomas
Yes. Increasing immigration is a way of keeping that bubble inflated longer.
Like I said, it was jokingly flippant, in terms of actual reasons.

------
mbesto
Alright, someone please explain to me how this can be fixed? For example, I'm
American and my team is a Russian and a Belgian. I would love for all of us to
pick up our bags and move to the US, but can't because of obvious immigration
issues. So even if there was a system set up to support them immigrating to
the US, how on earth am I supposed to prove that they would contributing
members of society (aka pay high taxes and add jobs)?

------
geebee
Zuckerberg said: "We have a strange immigration policy for a nation of
immigrants". The economist says "insane" would be a better term.

I actually agree that we should be more welcoming to highly skilled immigrants
in general, but the "nation of immigrants" rhetoric is getting irritating.

The US currently takes 1.2 million immigrants legally into the country every
year. This will be true regardless of whether we award large numbers of work
visas to the sort of people Zuckerberg would like to hire.

Our immigration system is more based on family reunification than the hiring
priorities of the high tech industry. I would agree that there are better ways
to decide who will get to come to the US.

But this isn't really about immigration per se, the specific legislation under
consideration is about awarding visas or green cards directly to people with
graduate STEM degrees. A good idea sure, but why does nobody at the economist
point out that US takes huge numbers of immigrants every year and will
continue to do so regardless of what happens with this legislation?

~~~
krschultz
Why is the 1.2 million number fixed in stone? I would be happy to have 10
million a year. 1.2 million is clearly below the market demand, and the market
demand is what is driving the whole thing. It was really enlightening for me
that illegal immigration dropped when the economy went down in the last few
years. If we align immigration with the market everything would be better.

Obviously there is a number where our infrastructure would be completely
swamped, but nothing grows the economy faster than a pile of immigrants.
Especially when they are permanent immigrants. The current system encourages a
lot people to come for a short period and then go home, which isn't really
great for the country long term.

~~~
Kudzu_Bob
Why not a hundred million a year? You could get that many from Africa alone.
Because nothing grows the economy faster than a pile of immigrants, except
maybe an extinction-level mega-tsunami of immigrants racing toward the
coastline at hypersonic speed.

Yep, that would really be great for the economy. Which is of course exactly
the same thing as the country.

------
nahname
Curious to hear others experiences. How many white, north american born people
are on your current team? I'm the only one on my current team and have often
been the minority in the groups I work with.

------
larrybolt
As a european developer and HN reader I've recently been wondering how
feasible it is to move to the states after I finished university.

It seems the general trend would be something in the like of getting a visa,
start looking for a job and be lucky your employer can get you a green card.
After this 5 years of living in the states before you can become an American
citizen.

Please do correct me if I'm wrong!

~~~
ropiku
H-1B is an employer sponsored visa, valid only for working on a specific job
(though it's possible to transfer to a different employer) so it's getting a
job first then getting a visa. Then your employer can sponsor your green card
application. Depending on the level you apply/qualify for you wait 1-6 years
for a green card.

~~~
larrybolt
What exactly does that mean, the level you apply/qualify for? Does it depend
on your education or merely on how much your employer put into it? Because 6
years waiting for a green card, after which another 5 years before you can
apply for citizenship and keeping in mind the economy changes trough the
years.

~~~
potatolicious
Short answer: all of the above.

The most important factor here is your preference category when applying for a
green card. There are 3 buckets, EB-1, EB-2, and EB-3, in decreasing order of
desirability. Which bucket you fall into is a combination of your degree(s)
and your relevant work experience.

Each bucket has a longer wait than the previous.

The second factor is your country of origin - the system is quota'ed based on
it, so the more applicants coming from your country of origin the longer the
line is. For the most part this is a minor factor except if you're from China
or India, in which case you're pretty fucked.

I believe (though I'm not sure) there are also other ways to expedite
processing for $$$, but this mostly surrounds various form filings that can
otherwise take months to process. The actual _line_ itself cannot be
shortened.

------
yekko
Abolish the indenture servitude H-1B program, have self applied green card
program instead.

------
aspensmonster
What's stopping all these companies from growing the talent themselves? The
rhetoric always makes it sound like the sky is falling and if they don't get
their super smart foreign staff NOW, the business will crash. The problem is
that this sort of story plays out year after year with one tech group or
another having a "critical shortage." You'd think if this were an immediate
problem then these companies that were unable to source and retain talent
would have died off by now. Surprisingly they're still here.

And the types of talent that the likes of Google or Facebook would be
interested in -- genuine genius and extra-ordinary ability-- already have visa
programs: O-1 and EB-1. It's just that H-1B visas are relatively easier to
get.

So what makes getting immigrants a better proposition than growing the talent
yourself? Everyone wants the talent, but nobody wants to cultivate it.

~~~
krschultz
Forget that angle for a second.

When I sitting in my graduate engineer classes, 50%+ of the students were
foreign. Most of them were working with professors on projects supported by
the federal government via various grants programs (NIS, DOD, etc). Most of
them wanted to stay in the US after graduation.

Few of them were allowed to.

Doesn't that seem like a massive waste of our educational system? Why are we
spending so much time and energy educating people and then refusing to allow
them to stay in the US?

~~~
Kudzu_Bob
No, what seems like a massive waste of our educational system is the notion
that Federal tax dollars are going toward the higher education of non-citizens
at the same time that millions of Americans either can't afford to go to
school or are groaning under the weight of student debts. Odd that you should
have missed that.

~~~
cema
I think in the case of STEM grad schools the Federal money finally goes where
the best return on investment is. Professors, not government, decide whom to
hire, roughly speaking.

~~~
Kudzu_Bob
The best return for whom? For the Americans forking over tax money used for
the employment and credentialing of people not from this country?

