Resurrecting the American dream - Hindustan Times

Resurrecting the American dream

Aug 02, 2023 12:42 PM IST

In the past two decades, protectionist US policies on immigrants forced tech founders and engineers to move away. Now, a new California law hopes to change that

America has enjoyed the closest thing to a free lunch with immigration. The best and the brightest from all over the world have long flocked to its shores to build innovative companies and strengthen its economy. But for the last two decades, protectionism and politics have caused the tide to turn. My 2012 book, The Immigrant Exodus, documented how restrictive and borderline-cruel United States (US) national immigration policy was, forcing many founders and smart engineers to move away. India and China have been the beneficiaries, now home to hundreds of highly innovative and globally competitive companies.

Indian H1-B holders have to wait as long as 89 years for their permanent residency visas according to the Cato Institute(PTI)
Indian H1-B holders have to wait as long as 89 years for their permanent residency visas according to the Cato Institute(PTI)

California has benefitted the most from the twin pillars of cutting-edge technology and bold entrepreneurship. The Golden State has the highest concentration of technology talent on Earth. Much of this talent has come from other countries, immigrant founders or children of immigrants representing a disproportionate share of founders of successful companies, including Apple, Intel, Google, Stripe, and WhatsApp.

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California could have become an even greater story of technological success if all the talented immigrants who had wanted to work and live there were allowed to. I have witnessed the loss myself, with my students at Carnegie Mellon Silicon Valley and Stanford University being unable to start innovative companies here.

Numerous other countries have created special visas and recruitment programmes in order to attract Science, Technology, Engineering and Mathematics (STEM) talent and founders. Most recently, the Canadian government announced a new programme specifically for non-citizen technology workers holding US H1-B visas. It filled its 10,000-strong applicant queue in just two days. The US, meanwhile, has maintained a byzantine and confusing immigration process with exceptionally limited slots for multi-year work visas. Indian H1-B holders have to wait as long as 89 years for their permanent residency visas according to the Cato Institute, which estimated that 200,000 Indians would die of old age while awaiting green cards.

But, as initiatives in US national immigration policy continue to languish, California governor Gavin Newsom is not waiting around. Newsom budgeted $2 million for a Global Entrepreneur in Residence (GEIR) pilot programme at the University of California (UC). Enabling UC to sponsor visas for talented graduates and promising technologists to build startups under UC guidance, the programme’s goal is to attract and retain international talent and bolster high-tech industries such as semiconductors.

This innovative approach aims to take advantage of two opportunities. First, it aims to retain foreign-born graduates who obtain their degrees from Californian institutions and who would otherwise take their skills elsewhere due to visa obstacles.

Second, the programme will strategically target expertise in semiconductor research and manufacturing, to align with the federal CHIPS Act’s $53 billion investment in revitalising America’s position as a chipmaking superpower. Although the US has many experts in semiconductor design and tooling, it sorely lacks cutting-edge expertise in the latest fabrication technologies. The US share of global semiconductor manufacturing capacity has consequently fallen from 37% in 1990 to just 12% today. Korea and Taiwan have raced ahead of the US in recent years, and much of the best talent in this rarified area works in those places.

The UC GEIR will select accomplished foreign graduates from STEM programmes to receive mentorship and resources to help them launch companies. As entrepreneurs in residence, participants will collaborate with UC researchers, lending their own technical skills. UC will sponsor their work visas, allowing them to continue developing their ventures.

Programme proponents say that the UC GEIR could be used to jumpstart California’s semiconductor manufacturing industry and to help the state tap into the deep coffers of the CHIPS Act, which offers $52 billion in subsidies and tax credits to foster semiconductor manufacturing. Artificial Intelligence (AI) might be another area in which GEIR could have a disproportionate effect.

According to recent research by the National Foundation for American Policy, 77% of the leading US-based AI companies were founded or co-founded by immigrants or the children of immigrants, and 42% of the top US-based AI companies had a founder who came to America as an international student. In many areas, California already sets the de facto national policy for the rest of the US. As the fifth-largest economy in the world, California behaves more like a hegemon than a sub-region subject to a higher legal authority. Should this programme prove effective, California has the deep pockets to expand the GEIR and the political power to forge workarounds to set in motion its own international immigration policy.

Newsom — and most of California’s technology community — understand the powerful pull the state has on global talent and recognize that talented immigrants are an economic unicorn, a free lunch. They also understand that as California faces its first-ever population decline due to high costs and technology layoffs, if the growth miracle is to continue, the state needs to attract companies that create high-paying jobs and IPOs that keep it prospering. Rather than wait for Washington, DC, to reform national policy, California is forging its own path — against which other nations, let alone other states, will find competing difficult.

California is leading the way, forging a smarter high-skilled immigrant policy that will help keep the Golden State golden — and bolster American tech and the American economy. And yes, this will be a loss for both India and China.

Vivek Wadhwa is an academic, entrepreneur, and author. The views expressed are personal

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