Allowing Skilled Immigrants into America

I thought this was relevant, considering the group of friends that I have from Silicon Valley.

From the mind of Gary Becker:

Scientists, engineers, and other highly skilled workers often must wait years before receiving a green card that allows them to stay permanently in the US. Only 140,000 green cards are specifically allocated annually to mainly skilled workers. An alternate route for highly skilled professionals, especially IT workers, has been to seek temporary H-1B visas that allow them to come for specific jobs for three years, with the possibility of one renewal. But Congress foolishly cut the annual quota under that program in 2003 from almost 200,000 workers to well under 100,000. The small quota of just 65,000 persons for the current fiscal year that began October 1 is already exhausted!

The right approach is to go in the exact opposite direction: to greatly increase the number of entry permits to highly skilled professionals, and eliminate the H-1B program, so that all such visas became permanent. Skilled immigrant workers like engineers and scientists are in fields that are not attracting many Americans. They also work in IT industries, such as computers and biotech, which have become the backbone of the well-performing American economy. Over one-quarter of the entrepreneurs and higher--evel employees in Silicon Valley were born overseas. These immigrants create jobs and opportunities for native-born Americans of all types and levels of skills.

Since they earn more than average, highly skilled professional immigrants contribute disproportionately to tax revenue. They are also considerably younger than average, so they are net contributors to social security revenue. In addition, they and their children have low crime rates and make few demands on the public purse. They have low levels of unemployment, seldom go on welfare, generally have above average health, have relatively small families, and their children do well at school and cause few disciplinary problems.

To me it seems like a win-win situation for the US to admit annually a million or more skilled professionals with permanent green cards that allow them eventually to become American citizens. Permanent rather than temporary admissions of the H-1B type have many advantages to the US as well as to the foreign professionals. With permanent admission, these professionals would make a much greater commitment to becoming part of American culture rather than forming separate enclaves in the expectation they are here only temporarily. They would also be more concerned with advancing in the American economy rather than with the skills and knowledge they could bring back to India, China, or wherever else they came from. In particular, they would become less concerned with absconding with the intellectual property of American companies, property that could help them advance in their countries of origin, perhaps through starting their own companies.

Basically, I am proposing that the H-1B program and the explicit admission of foreign workers be folded into a much larger employment-based green card program for foreign workers. With the emphasis on skilled workers, the annual quota should be multiplied many times from present limits. Unlike the present admission program, there should be no upper bound on the numbers from any single country. Such upper bounds, either in absolute numbers or as percentages, place large countries like India and China with many highly qualified professionals at a considerable and unfair disadvantage.

To be sure, the annual admission of a million or more highly skilled workers, such as engineers and scientists, would lower the earnings of American workers they compete against. The effect on earnings from this greater competition would discourage some Americans from becoming engineers or other professionals. The opposition from competing American workers is probably the main reason for the sharp restrictions on the number admitted. But doesn't the US benefit if, for example, India spends a lot on its highly esteemed Institutes of Technology to train many scientists and engineers who leave to work in America?

Many of the sending countries protest against this emigration by calling it a "brain drain". Yet migration of workers, like free trade in goods, is not a zero sum game, but one with a positive sum that usually, although not always, benefits both the sending country and the receiving country. In the case of migration of highly skilled workers to the US, I believe that it is a winning situation both for the US and for the nations that trained them because these emigrants send back remittances, and some of them return to start businesses based on the experiences they gained in the US.

If America does not accept greatly increased numbers of highly skilled professionals, they might go elsewhere-Canada and Australia, to take two examples, are actively recruiting IT professionals. Or they will remain at home and compete against the US through the outsourcing of highly skilled engineering, research, and other such activities. The growth of outsourcing has created an entirely new case for more generous admissions of skilled immigrants. Since earnings are much higher in the US, many of these workers would still prefer to come here or to other rich countries, but if they cannot, they can now compete more effectively than in the past through outsourcing and similar forms of international trade in services. The US would be much better off by having such skilled workers become residents and citizens, and in this way contribute to American productivity, culture, tax revenues, and education than by having them compete from their origin nations.

I do, however, advocate being careful about admitting students and skilled workers from countries that have produced many terrorists, such as Saudi Arabia and Pakistan. My attitude may be dismissed as religious "profiling", but intelligent and fact-based profiling is essential in the war against terror.

Other countries too should liberalize their policies toward immigration of skilled workers. I particularly think of Japan and Germany that have rapidly aging and soon to be declining populations that are not sympathetic (especially Japan) to absorbing many immigrants. But America still has a major advantage in attracting skilled workers since this is the preferred destination of the vast majority of them. Why not take advantage of the preference to come here rather than forcing highly desirable immigrants to look elsewhere?

My first preference is to admit many immigrants through a sale of the right to immigrate (see the discussion in our blog entry of February 21, 2005). Since skilled immigrants would tend to bid the most, that policy too would favor skilled immigrants. But in this discussion I have set aside my preference for a market in entry rights in order to concentrate on the importance of getting more highly skilled immigrants, with or without charging for admission.

So come on guys. About 95% of you guys who may occassionally glance at my blog are immigrants' kids with parents working in IT or something similar. So, what are your thoughts on this?