Hacker News new | past | comments | ask | show | jobs | submit login
Why Immigrant Entrepreneurs Are Leaving the U.S (businessweek.com)
58 points by DanielRibeiro on April 28, 2011 | hide | past | favorite | 47 comments



Now how did I know that this was a Vivek Wadhwa article before I even followed the link to read the article? Oh, yeah, because this is Vivek Wadhwa's pet issue. As in his previous articles on this subject, he doesn't give any big-picture official statistics (even though those should be available) about how much demand there is under current rules for immigrant visas to the United States by persons from China or India who have completed university educations. Nor does he even relate his anecdotes to the (large) percentage of graduate students in the United States from India or China who somehow manage to stay and eventually settle in the United States under current rules. He simply doesn't provide any thoughtful analytical context for the policy position he supports.

I think it's wonderful for the United States to accept a lot of immigrants--my wife is an immigrant from another country. But I will simply ask the policy questions I generally ask when HN threads include discussion of immigration policy:

1) What country offers BETTER general conditions for convenient immigration by educated persons from China or from India than the United States? Where are that country's immigration rules posted on the World Wide Web? Would you rather live there than in the United States?

2) What countries offer easy and convenient immigration to an arbitrary person from an arbitrary country, say an African person who would like to start a new life by founding a business in some developed country? Where could that person immigrate readily and legally?

3) What countries allow Americans readily to settle with permanent residence status that could turn into citizenship after an application on the same terms that Vivek Wadhwa advocates that the United States offer to citizens of other countries? What countries are currently visible examples of the results of the kind of policy he proposes? Would you rather live in one of those countries than in the United States?

4) Is there any country on earth that has a NET inflow of immigrants from the United States, compared to the number of its own citizens who emigrate to the United States? What country is that? What are its immigration rules? Would you like to start a start-up there?

After edit: If you are sure that there is another country that provides better immigration rules for start-up entrepreneurs than the United States, could you kindly link to some website hosted by that country explaining what the rules are?


Anecdotally speaking, "Canada" is a good answer to many of the questions that you pose.


And, from what I understand, Australia.


It is much easier to move (and to immigrate) in Canada than Australia, however. Entrepreneurial spirit may be similar, but immigration laws are very different (and, although less critical, the distance from large markets).


I was discussing (and with the proviso that my knowledge was superficial at best) immigration policy - which seems comparable. Googling around shows me that Australia has a large foreign born population (24%), and a points based system similar to Canada's.


Singapore seems to have the most entrepreneur friendly immigration policy.

They changed the eligibility criteria to add some investment and financial obligations in 2009. Until 2009, there were no investment required, no minimum employees and spending requirement.

http://www.business.gov.sg/EN/BusinessTopic/HiringNTraining/...


Would you say that Canada has done as good a job or better of assimilating those immigrants culturally than the US has? (I think that's one of the reasons for the quotas/other hoops - to make it so that there's not enough at any given time to make sticking entirely to one's old cultural group easy).


Just because the United States has the most liberal immigration policy doesn't mean it shouldn't be more liberal.

As with startups- don't worry about the competition, focus on making yourself better.


Letting in everyone who wants to come is not pure upside, it can be incredibly disruptive if not managed.

That said, we should be putting a lot more effort into letting the cream of the crop settle without any hassle. International students at top engineering/science schools should have the red carpet rolled out for them. If they're good enough to get into MIT or Caltech, or a school like IIT abroad, they should be actively courted.


> Is there any country on earth that has a NET inflow of immigrants from the United States, compared to the number of its own citizens who emigrate to the United States?

My guess is that the Vatican might qualify given the "low birth rate", and perhaps Monaco, although that one's just a hunch and I have no numbers.

Since someone took the trouble to downvote, I guess I need to spell it out (I thought it was quite obvious) that mine was more of an 'intellectual curiosity' sort of response to his question rather than a real data point.


I'm not finding US emigration numbers, but working from the American expatriate numbers, which include both emigrants and people who will eventually return, the following look likely:

  Country      1996 Immigration    1999 total Americans
  Canada       15825               687700
  UK           13657               224000
  Germany       6748               210880
  Israel        3126               184195
  Italy         2501               168967
  Australia     2750               102800
  France        3079               101750
The high "total americans" to "annual immigration from" rations seem likely that the annual emigration may be a net positive. (Remember, some of the immigrants will eventually return home too.)

Immigration data from: http://www.infoplease.com/ipa/A0201398.html Americans abroad data from: http://unstats.un.org/unsd/Demographic/meetings/egm/migratio...


I'll grant that this article is light on evidence, but it can be true that every country has a worse immigration policy than the US, and that people tend to return to their home countries to start their businesses. Because every country tends to treat its own citizens better than it treats immigrants. I thought that this was the point of the article. Most of the points that you raise have to do comparing immigration policies with one another, rather than comparing immigration policies with domestic policies.

Also, I (and I imagine many supporters of open immigration in the US) would certainly argue that every country should be friendlier to immigrants, not just the US. The whole world is terrible on immigration and getting worse.

The issue is not who has the least bad immigration policy. It's not getting people to immigrate here as opposed to immigrate to other countries. The issue is making our immigration policy good enough to make it preferable to immigrate here as opposed to not immigrate at all, which is the real danger.


Good questions in general, but how are they relevant here? Wadhwa is asserting that skilled immigrants are returning home to China, India, etc., not heading to some other foreign country like Chile to do their startup. We're not competing against other expat locations for immigrants, we're competing against the simple act of them staying or returning home.


Australia


Australia's rules give you bonus points (literally -- there's a points scheme) if you're on the desired skills list[1]; pretty tough otherwise.

For OP I would have given Singapore as a country with liberal immigration, simple business requirements and low taxes.

[1] http://www.immi.gov.au/skilled/_pdf/sol-schedule3.pdf


From the article: "Let's start by increasing the number of permanent resident visas available for the 1 million engineers, scientists, doctors, and researchers and their families who are in the U.S. legally but trapped in immigration limbo."

Amen to that brother. But myself being someone in that limbo for the last eight years, I dont have much hopes for it. And this is not a Silicon valley story either. I have about 25,000 people ahead of me in the queue. And each year the queue moves in a snails pace. In this pace, I should have it by the time my two year old son graduates. And then I will create the next Google. (I am kidding. Being an entrepreneur means overcoming these, and I am committed to that)

And we are talking only about 750,000 visas currently in adjudication. Just under a million green cards. And at the very least I believe, it can create two million jobs.

Nothing is being done because "1 million engineers, scientists, doctors, and researchers and their families" are not a lethal voting bloc. They lack a voice.

I empathize with people like me. As I do with Americans who have lost their jobs, and the families of illegal immigrants who live in the society's shadows. If there were easy answers to this solution, we would have found it by now. And politicians prefer solutions that are easy to explain to their constituents. We are so used to soundbites now that anything more complex than a monosyllable evokes a strong abhorrent response.


The problem with decoupling amnesty for illegals and high skilled immigration is that the administration doesn't care about high skilled immigration. Illegal immigrants, were they to become legal, will vote Dem. Thus Dems favor it, Reps oppose it. High skilled immigrants don't show a large bias, neither party gets a political advantage from high skilled immigration, so it goes nowhere.

However, don't think that work authorization will stop innovation from fleeing the country. I'm a US Citizen, and I'm leaving the US to start a business in India in few weeks. My partners are both Indians with a green card.

It would be preferable for us to start our business in the US. We'd love to hire unemployed low skill Americans to act as mechanical turks for us (we need quite a bit of AAI). Their cultural knowledge would certainly be superior to Indian college students (important, since the US is our target market). But Americans are simply too expensive - the business wouldn't be feasible at US minimum wage rates, let alone wages high enough to convince Americans to give up unemployment benefits and come back to work.


Let me see if I have this right:

You complain about the US not allowing high skilled immigrants in the first paragraph, but then you say you want to hire low skill mechanical turks at below minimum wage in your last paragraph.

You are upset that workers in the US will not work for Indian wages when they have US expenses. Furthermore, you imply that your wages are so low that people prefer the small unemployment benefits instead of working for you.


I made no complaint, nor am I upset. I was merely giving objective reasons why, no matter how many visas you give out, some businesses are simply not going to be built in the US. I also explained why politicians focus on low skill illegal immigrants rather than high skill legal immigrants.

Personally, I'm looking forward to moving to India. The food is tasty, the women are beautiful, and it's time for me to do something different. I have no complaints.


Personally, I'm looking forward to moving to India. The food is tasty, the women are beautiful.

...and the bureaucracy and corruption are out of this world. Good luck.


Oh...and let's not forget all those they murder for not believing religiously as they do. No thanks.


rumpelstiltskin has a very valid point, but your's is unsubstantiated cant. Where is the evidence that you get murdered for just not believing religiously as they do?


Good luck!

Obviously, I want the US to be competitive, but this is far more out of a desire to see the US prosper than a desire to "beat" other countries in some non-existent competition.

Yes, I want silicon valley (and the US in general) to remain home to many innovative companies. No, it doesn't bother me to see India prosper. There are a billion people living in india, many in horrendous poverty. It almost seems nuts that people would fret about the notion that some of the worlds great businesses would happen in India and lift people out of desperate poverty.

Seriously, it's highly desirable for people to start businesses in India. While the US should try to be a good place for business, we must not start to see it as some innate failure when other countries prosper as well.


I think for most it's a case of keeping up with/beating the Joneses, at a much larger scale.


> Personally, I'm looking forward to moving to India.

Keep us posted on how it goes. Good luck! (not being sarcastic).


Very interesting, would you care to elaborate on your business, since you're making such a strong commitment to it?


It's a search engine for fashion - Google Boutiques is the natural point of comparison. Of course, we are hoping to do considerably better than Boutiques.

It would be great to hire Americans, because while the girls we have in Pune are great, they don't know things like who Lady Gaga is or what she might wear.


That's quite an edge case though, you must admit. In most cases immigrant entrepreneurs would come to and stay in America if the laws allowed.


Wow! What business are you starting?


For a perspective on why H1-B people might want to flee the United States because of execrable tax policy, you can check out this post and comments on my blog:

http://hodgen.com/hb-person-need-of-fbar-assistance/

tl;dr - if you have more than $10K in a foreign bank account you have to file a tax form. If you don't file such a form, horrific penalties ensue. H1-B workers frequently have accounts in their home countries with more than $10K. They come here to work, become residents for US tax purposes, and are liable for the penalties.

I have talked to more than one such person who finds it expedient to quit their US job and leave in order to eliminate the US tax risk.

EDIT: In case the connection is not obvious, the same logic would apply to immigrant entrepreneurs. If you have some capital outside the USA and you get a green card, you can stay (and risk six-figure tax penalties) or you can give up the green card and eliminate your tax risk. I have a booming business in "give up green card" work at the moment.


Some interesting thoughts on immigration from economist Milton Friedman (http://www.youtube.com/watch?v=3eyJIbSgdSE):

I’ve always been amused by a kind of a paradox. Suppose you go around and ask people: ‘The United States before 1914, as you know, had completely free immigration. Anybody could get in a boat and come to these shores and if landed at Ellis Island he was an immigrant. Was that a good thing or a bad thing?

You will find that hardly a soul who will say that it was a bad thing. Almost everybody will say it was a good thing. ‘But what about today? Do you think we should have free immigration?’ ‘Oh, no,’ they’ll say, ‘We couldn’t possibly have free immigration today. Why, that would flood us with immigrants from India, and God knows where. We’d be driven down to a bare subsistence level.’

What’s the difference? How can people be so inconsistent? Why is it that free immigration was a good thing before 1914 and free immigration is a bad thing today? Well, there is a sense in which that answer is right. There’s a sense in which free immigration, in the same sense as we had it before 1914 is not possible today. Why not?

Because it is one thing to have free immigration to jobs. It is another thing to have free immigration to welfare. And you cannot have both. If you have a welfare state, if you have a state in which every resident is promises a certain minimal level of income, or a minimum level of subsistence, regardless of whether he works or not, produces it or not. Then it really is an impossible thing.


"Let's start by increasing the number of permanent resident visas available for the 1 million engineers, scientists, doctors, and researchers and their families who are in the U.S. legally but trapped in immigration limbo."

My problem with this is that a recent RAND study found that Americans are avoiding careers in science and engineering because these fields have become uncompetitive with the professions (law, mba, md, dds, etc) in terms of salary, job stability, and career prospects. In other words, a "shortage", to the extent that it exists, may be a rational response by americans to poor career prospects. It might not make sense to use the immigration system to increase the pool of PhD level scientists and engineers when the most objective research available is concluding that these careers have lost their luster. At the very least, we should recognize that this would probably provide even greater deterrence for people in the US who do have the right to choose their career path.

I tend to favor a points-based system in the US, something more similar to Canada or Australia. I've read about these systems, and while they certainly give credit to scientists and engineers, they appear to be very broad-based (plumbers, lawyers, and electricians get more points than programmers in Australia, last time I looked).

One thing I do agree with - the current system is horrible, the worst of all worlds. We bring in lots of "guest workers", targeting fields that probably aren't experiencing any shortage, and we create an indentured system that in my opinion pretty much violates the concept of personal freedom. It's a crappy system for immigrant and american scientists and engineers, but it does serve a few interests very well.

I pretty much say this every time: take a large but not unlimited number of immigrants, value education and skills in the abstract but avoid focusing too narrowly on any particular trade, profession, or skill set, and give immigrants full freedom to determine their own course in life (ie., no geographical or career restrictions).


The market in many countries seems relatively untapped compared to the US. You can't fix that problem with a law.


Perspective from a highly educated, legal immigrant family:

I came here with my parents, who emigrated from the former USSR via the student visa route in 1992. This is one of the hardest paths to permanent residency in the US because a great deal of student visas either explicitly foresee a return of the student to their native country for some period of time (owing to various reciprocal treaties to that effect), or are implicitly structured to discourage permanent immigration per se.

Somehow, my parents defied the odds, frequently hopping between various F, J and H-class visas, begging for employer sponsorship through these processes in an already grossly unfavourable job market (humanities academia). In at least one case, I remember that making changes to visa status before the existing visa expired required short-circuiting the INS bureaucracy and going to the US consulate in a Mexican border town to get the job done--ironically, much faster.

It wasn't even until 2002--a decade later--that we had a greencard. Up until that point, if my dad had been dismissed by any of his employers or lost his student for any reason, we would have had to return to our country immediately, from where trying to seek new opportunities along these lines--especially in the 1990s--would have been impractically difficult. Worse yet, a petition for a greencard from many classes of visa means that if for some reason the petition is denied, you forfeit your existing visa and also must leave. And of course, employer sponsorship was required.

We finally became naturalised US citizens in 2008, 16 years later, well after I had spent close to 3/4ths of my life here. And many commentators who work with people in our situation have remarked that this was brisk and efficient.

While I am definitely speaking from the vantage point of a particular visa classification and method of entry, I don't gather that our situation is that uncommon. The number one problem that I see with American immigration from an economic perspective is that it's simply too hard to immigrate here (legally)[1], and most especially as a highly educated or highly skilled person. Marrying an American or obtaining a refugee status of some description is a much more efficient path to permanent residency, for example. Meanwhile, a person with an existing PhD like my dad had to essentially get another PhD to become employable here[2], while persuading employers all throughout to argue that there no equally suitable American candidate was found for his job, etc, etc. I have not seen janitors face such hurdles.

I will freely grant that it's not nearly as hard to immigrate to the US legally as it is to say, Western Europe, but it's also not as easy as Canada or some other Western countries whose immigration systems admit an explicit preference for high qualifications. And as the author points out, with domestic economies becoming more and more attractive, it just isn't worth the effort to fight with this immigration system like it used to be.

EDIT: To relate this back to Vivek Wadhwa's article: We come from Moscow. In the early 1990s, following the dissolution of the USSR, Moscow was a pretty miserable place to live. Coupled with the enthusiasm to leave the Soviet context in general, the appeal of America was pretty clear. Nowadays, Moscow is not a particularly miserable place (although the reasons for that, and the question of whether they are good, sustainable reasons, are a separate discussion entirely), and few people in Moscow, whether part of the noveau elite or otherwise, are deluded with the idea that they can find a better life in America--they already live in a gold-plated bubble rapidly coming to rival Manhattan sensibilities. So for whom does the US remain an attractive destination in Russia? Mostly provincial, less-educated people from poorer, simpler places. I read Wadhwa's article to be saying that--extrapolating from this more generally--this does not set up the incentives we really want.

[1] I found this chart from Reason Magazine to be a pretty accurate illustration of the problem: http://reason.org/files/a87d1550853898a9b306ef458f116079.pdf

[2] Yes, that's technically a separate issue from immigration policy and is rather tied up in the specificity of his profession, but if you want to talk about the amount of mountain-moving required to move to the US permanently, as a whole, it deserves consideration.


The number one problem that I see with American immigration from an economic perspective is that it's simply too hard to immigrate here (legally), and most especially as a highly educated or highly skilled person.

Is there somewhere else where immigration is much easier than the United States? If so, where? Have you ever thought of living there?


Well, back when I would have been in a position to consider living somewhere else, I was a minor. And since I've been in the US from age six and am functionally American for all practical purposes, obviously, like most people, I am not possessed with the desire to uproot myself and relocate without a compelling reason.

You seem to be clinging to relative arguments throughout the comments. I agree that it's important to keep the overall merits of the US relative to many alternatives in perspective, yes. But relative arguments only go so far. Yes, I could be in a refugee camp in Darfur; doubtless, my situation--almost anyone's situation--could be a lot worse than the espresso machine breaking down or the laundromat being inconveniently far away. But it doesn't mean people shouldn't be allowed to complain about absolute inadequacies of the system, or advocate for its improvement.


I'm 100 percent for people from anywhere in the world, even people who have never seen the United States, advocating for improvement of policies in the United States. Policy improvement is a great idea, and I was happy to have it happen in the United States even during the several years of my life when I wasn't living here.

But I ask about the policies of other places, and what attractions those set up for immigrants, for a policy-based reason. Most public policies cannot be set to be ideal in the abstract. Indeed, there is not even enough agreement among voters to be sure what the abstract ideal of perfect policy would look like. Every country in every era, democracy or dictatorship, makes policy trade-offs. I think the discussion of United States policy can be best informed--and thus most helpful to the United States, the country I now live in--if people like you with valuable international perspective are as specific as possible in comparing United States policies to policies of other countries you know about. As I wrote in the first reply I posted in this thread, there ought to be official statistics on many of the issues mentioned in the article that opened this thread, and those official statistics from various governments may guide us better to understand what policy trade-offs make for a thriving economy, well functioning democracy and rule of law, and an open and vibrant society.


My worry with your argument (if I'm following correctly) is why should we compare/base US immigration policy on the policy of other nations? If we accept that US policy is more favorable than others, is it purely acceptable to meet the lowest bar? I'd argue we should always, in all facets of policy and life, be actively working to raise the bar.


Fair enough. That seems like a very well-reasoned position.


Canada, Australia, most countries with a points based immigration system are much easier. My story was much like the grandparents. Moved to the US at 14 and bounced around between visas H4 -> F1 -> H1B. I didn't get my green card with the rest of my family because I turned 21 while the application was pending. I am in Europe now and will NEVER deal with US immigration again. There is truly nothing that will make me want to live in that limbo again.


Yes, immigrating to Finland or Ireland is way easier than States (at least if you are in IT).

Problem with Ireland right now is bad economy, difficult to find a job, but possible. Finland is much easier. And in both countries you become a citizen after 5-6 years.

Oh, and you don't need to know finnish to work in IT here.

Also I've heard Sweden and Australia is not that hard either. Canada was quite easy to get into up until few months ago (they removed IT from the needed professions list).

Basically, from what I've heard from my fellow Russian friends, States is not that favorable in terms of immigration.


> Is there somewhere else where immigration is much easier than the United States

Once my Italian wife and I were married, I acquired the right to stay in Italy from that moment on, with no hassles. The amount of paperwork for her, on the other hand, to go to the US, is quite unpleasant, and the process would even involve a doctor having a look at her. And she has a PhD in biochemistry (she's employable in other words) and is the wife and mother of US citizens.

I wouldn't ever cite Italy as a model for the ease of its bureaucratic procedures, but in this specific case, Italy does come out ahead of the US.


Is there somewhere else where immigration is much easier than the United States?

As a data point, I applied for Permanent Residency as part of the Australian Independent Immigration program in 2000. The processing took about 8 months, then I was granted a permanent visa, then I moved to Australia in 2001 and became a citizen after two years (this has been since changed to four years and the application processing times also may vary, from what I know - 2001 was one of the "good" years).


> Is there somewhere else where immigration is much easier than the United States?

Yes. The rest of the Western world.

> Have you ever thought of living there?

Currently in New Zealand, was in Australia.

Got citizenship after being a resident for 3 years.

No limbo either, residence was not tied to a particular employer.


Vivek, please use this energy to create more opportunities and better conditions for US students, that's the only long-term solution.

You can't easily grab international (Asian) brains as you did 50 years ago. Things changed.


Clueless US Administration is destroying the $15 trillion domestic economy to dilute $3 trillion Chinese foreign exchange reserves by devaluing/printing dollars.


So, the factor for leaving the US is better opportunities at home. But the solution is to fix immigration?




Guidelines | FAQ | Lists | API | Security | Legal | Apply to YC | Contact

Search: