Unfortunately, the proposals in this blog entry make me very nervous. I'm all for making it easier to allow talented people entry into the US, but I hate the idea of empowering investors to grant green cards. I think Paul Graham is an inspired investor and a smart guy, but should he be allowed to decide who comes into the country and who doesn't? Should a panel of credible lawyers, VC's, and entrepreneurs be allowed to do this?
I think that an employer should be able to offer a job, not US residency. I think an investor should be able to offer money (and advice, guidance, support). But not a green card, no way.
Think of the implications here. A young investor really doesn't need the money. He's ramen profitable. But he needs the investor's permission to be a startup in the us! Well, that's one way for VC's to get the upper hand in an era when their money doesn't matter as much.
Look, I know hacker news folks tend toward the libertarian side and are generally skeptical of government. But I want the people who decide to award green cards to report to the voting public, not to Larry Ellison. I admire PG, but he doesn't answer to me as a member of the voting public, and he shouldn't. Once VCs gain control over the immigration system, they assume a government role, but we can't exactly vote them out of office if we don't like their decisions. And even if you have faith that PG will be a good guy, do you feel that way about "credible VCs and lawyers?"
Winston Churchill said "It has been said that democracy is the worst form of government except all the others that have been tried." Personally, I'm not all that interested in trying out a regime of VCs, no matter how credible a panel has found them to be.
As for the "Green cards to all CS majors" idea, I think a very narrow rule targeting CS would discourage US students from this field, and encourage them instead to pursue more protected degree paths like law. I'm worried about any policy that would drive the already low interest in CS among US students even lower. I also think a University should be in the business of granting degrees, not US residency.
Yep, this part really struck a nerve: (2) the founder has to own at least 10% of a company that has raised $250,000 within the same year as the application for the Visa.
This is a power trip from the VC's it's also a method by which they can extract more equity from the founder of the company using "coming to america" as a carrot.
What does raising money have to do with founding a company? This is a stupid and ego-centric view of entrepreneurship.
90% of VC funded startups fail. 80% of restaurants fail and according to the SBA, as a general rule of thumb, new employer businesses have a 50/50 chance of surviving for five years or morehttp://www.businessknowhow.com/startup/business-failure.htm
Seems like it would be better for america if raising money was not a requirement of being a founder.
This is indeed a terrible idea. Every day it seems like I read folks on hn who are indeed familiar with start-ups and investment but who think they thereby understand economics.
The first thing they often don't understand is how perverse incentives work. Consider, lots of folks with $250K in the bank would be happy to get a guaranteed $50K out of it. So they would "invest" (launder) the money into a fake start-up which would serve only for the "found" to give them back their $250K plus $50K in return for the "founder" getting a green card.
Just one bad effect of this would be the fake start-ups themselves, which would pollute the start-up space with starting with more fake craiglist ads on up.
A book I had about US immigration said that the situation you outline actually occurred with the E-2 visa for quite some time. That's why the criteria for the E-2 are so strict now - if the criteria weren't so strict, it'd be the ideal "founders visa" already. Basically the post is proposing creating a lax E-2 (of sorts), which already failed once. (Even though people are throwing around numbers of $500k, etc, for the E-2 - that was certainly not the case even a few years ago.)
Perhaps the most interesting comment over there is on relaxing the criteria for the O-1 visa instead. Perhaps instead of being "incredibly famous" you could just be "well known in your field" instead.. I better keep in the top 100 on Hacker News then ;-)
My mother managed to get an O-1 actually - and she's not even college-educated. She's simply quite well known and regarded in her community (knitting, arts and crafts), and that was that.
The 500k number comes from people confusing the E-2 and the EB-5 I suspect. The EB-5 program gives you a greencard for a 500k$ investment in an disadvantaged area or $1m anywhere else. The money needs to be "at risk".
If there were programs I felt were sufficiently reputable I'd go for it. However, I'd want to quantify the risk. I'd rather not get into a situation where some ski resort gets partially built, goes under and funnily enough its all the immigrants money which disappears into dubious hands.. and the immigrants should just be happy they got their greencard.
The post makes no mention of investors being able to offer a green-card. Rather, only temporary status in the US for 1 year. Sure, most of the companies will fail and the founder's status would expire, but if you can get 1 Google founded in the US for every 1000 failed startups, I think the net effect would be positive for the US. In fact, I mentioned Google intentionally, because it's just one of a handful of companies started here because, at some point, the founder was grated status here. The same goes for eBay (France), Intel (Hungary), Nvidia and Yahoo (Taiwan). How awesome would it have been if a Samsung or Sony were started here? I don't know about you, but I'd much like to continue to see such companies in the US, making the American economy and the ecosystem of entrepreneurship unparalleled in the world.
In fact, Paul Graham's original essay leaves handing out the "founder's visa" entirely in the hands of the government. No mention is made to giving investors the power to grant immigration status. It would work in exactly the same way that the H1B visas work: Companies can vouch for a candidate to the government in an application, but ultimately it would be up to the government to decide. Don't like who they pick? Don't vote for your senator next time.
VCs and investor would "gain control over the immigration system" with the founders visa no more than universities and tech companies have control over immigrants with H or F visas
"It would work in exactly the same way that the H1B visas work: Companies can vouch for a candidate to the government in an application, but ultimately it would be up to the government to decide."
I completely disagree with this characterization of the H1B visa. Clearly, the visa is controlled by the employer, not the employee. And while the government does have to "ok" the visa, the employee does not apply directly to the government. The employer has tremendous, overwhelming authority over who does and does not get to come into the country and get in the queue for a green card.
A "points system" like the one used in Australia (discussed in other posts here) would preserve the immigrant's freedom, but I would like to point out that an Oracle lobbyist argued fiercely against it when a congressman proposed this, saying it would be "communistic" to have the government, rather than corporate HR, decide who Oracle gets to hire.
Personally, I'm outright cynical at this point. At first, I thought this was a design flaw, but now I'm pretty convinced that the industry likes the indentured nature of the visa and the extraordinary power it gives them over their employees. Those pesky US citizens and permanent residents can demand raises, leave for other offers, even gasp! start companies that compete with Oracle! Well, we can't have that! But H1Bs need green cards, and transfering jobs is risky, so by and large, they'll accept their lot in life and stick around for 5 years under the conditions we dictate.
"VCs and investor would "gain control over the immigration system" with the founders visa no more than universities and tech companies have control over immigrants with H or F visas".
We have profoundly different perspectives on the degree of control tech companies have over their employees on H1B visas.
I especially like the implications of item (b). To achieve this, we would have to have a public db of _all_ salaries!!! It would help normalize things in the same way we normalize real estate sales. Note: I do not believe public real estate sales data has anything to do with the real estate bubble and its collapse. Its possibly the best part of the U.S. real estate market.
But good luck getting congress to force all private and public companies to publish their salary data ;).
You could get a close enough estimate to implement the program from tax data, or confidential surveys of a small sample of employers, without requiring full public disclosure of all compensation.
But good luck getting congress to force all private and public companies to publish their salary data ;).
On a political level, I agree, it's a longshot. However, a company that claims it can't find qualified workers at competitive salaries and is asking for a special visa program certainly should be willing to make its salary information public.
I like these ideas.. ultimately you want people that are interested in becoming productive, value-adding members of society, whether that be genius tech founders or hard-working floor moppers. The challenge is finding the right mix of objective qualifications that represent this characteristic.
I think this is a great basis for eligibility. It isn't all that different from the "points" test in Australia (or Canada, from what I've heard).
My only difference is that I can't get behind granting residency to "everyone" with these attributes ... lots of people, sure, but I think that for practical reasons, the US can't offer citizenship or residency to everyone who would like it, even good folks who meet your criteria.
But considering that we take about 1.2 million a year into the US, I'd much rather a good system based on the criteria you've proposed than the dysfunctional nightmare we have right now.
Great proposal but somehow those companies which currently important H1b's for the wage savings they offer just never seem to behind sensible thinking like this. They must not be thinking very far ... beyond their bottom line.
If you don't like the "board of industry experts" idea, just go with Feld's second idea: "owns 10% of a company that raised $250K". That's a totally mechanical standard, which delegates no decisionmaking outside government.
Further, it should go without saying that other immigration conditions -- non-criminal, etc. -- will still be in effect.
I do think the proposal could be even more simple, though. We could just sell Visas to anyone who's law-abiding and self-sufficient. Then the only dimension for argument between pro- and anti-immigration advocates can be the price.
Start with a small pool and auction them off at a high price. Do a rolling study of taxes paid, jobs created, and services used by those who purchased those Visas. Each year, if prior experience suggests more people entering under this program would have been a net benefit, increase the pool. If the study ever indicates the entrants were a net drain, decrease the pool in following years.
You can even bias the whole process strongly against more immigration, to pander to the paranoid, and it would still address one of the biggest problems facing businesses: the uncertainty of getting a key employee in-country. There would be a relatively predictable price for doing so, which would allow rational planning.
Great, so all the rich sons of the Saudi Arabia royal family will buy their green card so they can travel freely, and all the entrepreneurs will stay home.
Rich heirs travel pretty freely already, and under this plan at least we'd get their money.
Plus, since such wealthy quasi-tourists create no net cost (and probably create value) with their visits, each year we'd increase the allotment until it reaches the intended audience: productive people we'd rather have here than competing against domestic employers from elsewhere.
I'm all for making it easier to allow talented people entry into the US, but I hate the idea of empowering investors to grant green cards.
Do you really think this will happen? This is a terrible idea, and if it were a good idea, the govt would never give up the right to decide who enters/stays the country, even partially.
Invoking the need of a panel indicates a fear of assuming a responsibility (i.e. diluting it into the faceless panel.) Why not just try it out, and afterwards evaluate? If it works, great; if it doesn't, if possible learn about why it didn't, and move on to the next strategy. All you'll lose is a year or two. And there is such thing as the right timing. In any case, nothing stops the legislator from doing both: going the panel way and the non-panel way simultaneously.
I think that an employer should be able to offer a job, not US residency. I think an investor should be able to offer money (and advice, guidance, support). But not a green card, no way.
Think of the implications here. A young investor really doesn't need the money. He's ramen profitable. But he needs the investor's permission to be a startup in the us! Well, that's one way for VC's to get the upper hand in an era when their money doesn't matter as much.
Look, I know hacker news folks tend toward the libertarian side and are generally skeptical of government. But I want the people who decide to award green cards to report to the voting public, not to Larry Ellison. I admire PG, but he doesn't answer to me as a member of the voting public, and he shouldn't. Once VCs gain control over the immigration system, they assume a government role, but we can't exactly vote them out of office if we don't like their decisions. And even if you have faith that PG will be a good guy, do you feel that way about "credible VCs and lawyers?"
Winston Churchill said "It has been said that democracy is the worst form of government except all the others that have been tried." Personally, I'm not all that interested in trying out a regime of VCs, no matter how credible a panel has found them to be.
As for the "Green cards to all CS majors" idea, I think a very narrow rule targeting CS would discourage US students from this field, and encourage them instead to pursue more protected degree paths like law. I'm worried about any policy that would drive the already low interest in CS among US students even lower. I also think a University should be in the business of granting degrees, not US residency.