America needs to rethink its immigration policy

The Immigrant Exodus: Why America Is Losing the Global Race to Capture Entrepreneurial 

IVEK WADHWA’S new book, “The Immigrant Exodus”, is admirably short, yet he packs it with righteous fury. America, he points out, has one of the greatest assets a nation can have: people yearn to live there. Chinese students, Indian doctors, British actors and French financiers flock to its shores. What is more, America is very welcoming and always has been. Its universities brim with foreign brains. Its zippiest companies are powered by immigrants. Some stay for ever. Others work for a while and return home, where they often continue to swap ideas and do business with their American friends.

A nation that can attract the cleverest people in the world can innovate and prosper indefinitely. Unless it does what America has done since September 11th 2001, which is to make the immigration process so slow, unpredictable and unpleasant that migrants stay away.

Consider the story of Puneet Arora, who came to America in 1996 to study medicine. He won a fellowship at the prestigious Mayo Clinic, worked for a while as a doctor in a deprived area and ended up as medical director at Genentech, a giant American biotech firm. Mr Arora is clearly the kind of citizen that any sensible country would be delighted to have. Yet America kept him waiting 16 years for a green card (which grants permanent residency).

Life in immigration limbo is wretched. Immigrants on H1-B visas, which are issued to skilled workers, must be sponsored by a specific employer. They cannot change jobs without imperilling their application. Their careers stagnate. They do not know whether they will be deported, so they hesitate to put down roots, buy a house or start a company. Sometimes their spouses are barred from working. In some states their spouses cannot even obtain a driving licence, as if they were female and living in Saudi Arabia. Fewer and fewer talented people are prepared to put up with such treatment, and they have plenty of other options. They know that Canada, Australia and Singapore hand out visas swiftly and without fuss. If they are from a poor country, they know that there are opportunities back home.

Mr Wadhwa’s finds are alarming. Since no nationality may receive more than 7% of employment-based green cards, Chinese and Indian applicants are treated more harshly than citizens of less populous nations. The time they must spend in limbo has shot up. If they have a great idea for a new company, they can go home and start it straight away. In America, if they quit their day job, they may be deported.

In a survey, Mr Wadhwa found that most Indian and Chinese students in America expect problems in obtaining a work visa when they graduate, regardless of the demand for their skills. An unprecedented number now plan to go home. Mr Wadhwa believes that immigration policy has halted the surge in high-tech firms founded by immigrants, and possibly reversed it. In Silicon Valley the proportion of high-tech start-ups they founded has fallen from 52% in 2005 to 44% this year.

“The Immigrant Exodus” is packed with examples of opportunities squandered for want of a visa. Hardik Desai, for example, persuaded hard-nosed investors to put $300,000 into his start-up, which made diagnostic technology. But he could not persuade the immigration authorities to let him work for his own company without proving that it could pay his salary for a long time—something almost no new firm can prove. So he had to shut it down.

Mr Wadhwa, who is himself of Indian origin, moved to America from Australia back in the days when it was easy. Working as a computer scientist, he received a green card in 18 months and went on to found two high-tech companies. He laments that, if the conditions when he first arrived had been as they are today, “I would have been a fool to leave Australia.” By locking out foreign talent, America has “blocked the flow of [its] very lifeblood,” he argues in this wise and powerful tract. Yet the problem is simple to solve. Mr Wadhwa lays out a seven-point plan that can be summarised in three words: let them in.