1. There is, as dictated by the law of supply-and-demand, not an undersupply of good programmers, otherwise good programmers would be in a negotiating position such that they would reject your 50k offer for a 150k offer elsewhere; or
2. The market cannot support this hypothetical company's business model. If my restaurant fails because labor costs leave me overrunning my revenue, few people would argue that is evidence we need immigration reform so I can find cheaper labor.
But unlike a resteraunt, you can open abroad and capture labor resources in other countries. So if programmers get too expensive in the states, or Silicon Valley, relative to the world market, there is a point where you are forced to open an office elsewhere (if not your competition does and eats your lunch). Without immigration, that would happen sooner (rather than the mythical doubling of American programming salaries).
Programmers in the US are already wildly, wildly expensive in the USA relative to the world market, often by an order of magnitude. So, if that's the case, we're already screwed and we're only being saved by some market inefficiency. We should all prepare for the inevitable future where we are doing very well to make 15-20k.
Ultimately it's a world market for labor at the top end. Barring artificial distortions (immigration/emigration restrictions), people will move to where they can get the best deal; since good Chinese programmers can immigrate to the states, it puts a floor on Chinese salaries, the same is true in India actually.
It is a whole different game for soso programmers. If you want a soso programmer in China, they will be much cheaper in the states, but the bottom is also much lower than one from the states could imagine, and often you just get what you pay for (or worse).
> Barring artificial distortions (immigration/emigration restrictions), people will move to where they can get the best deal;
No, they won't. Many people value staying near home more than they value additional salary. That's especially true for people who'd have to move house thousands of miles into a new culture, but it's true even of people within the US.
There is some of that, but not when wages are a magnitude off. If I can only make $50k in saint Louis and $150k in SF, there is huge pressure to move and start climbing the ladder. The programmer making $20k in Bangalore will move to the Bay area to add an extra zero to the end of their salary if they have the ability.
This mobility checks salary bottoms for those who do want to stay (e.g. for the market I'm in over in China).
There certainly is some pressure, but be careful not to overestimate it. Most programmers are not in Silicon Valley and feel no pressure to be even though they would make much more money. And this isn't even about "great" programmers versus competent programmers.
I'm one of them. If you can excuse my lack of humility, I am a great programmer. I've been described by management and teammembers regularly as a rock star. I could easily make 10x the salary were I to move to SV.
I have zero desire to and I've never felt like I was missing anything. Out of my graduating class, only one guy moved to California - in fact, he's the only guy I know of at all who moved to California. I know at least a dozen "great" programmers who live here quite happily.
Of course the extra money is an incentive and there obviously has been and is an influx of programmers to Silicon Valley and the surrounding area. But the wage impact (in terms of setting floors) of the migration is pretty minimal relative to other effects. That's why there are hundreds of thousands, if not millions, of programmers worldwide, including very close to the full 5% of "great" programmers from those areas, that are working for what you and I would consider garbage wages.
1. There is, as dictated by the law of supply-and-demand, not an undersupply of good programmers, otherwise good programmers would be in a negotiating position such that they would reject your 50k offer for a 150k offer elsewhere; or
2. The market cannot support this hypothetical company's business model. If my restaurant fails because labor costs leave me overrunning my revenue, few people would argue that is evidence we need immigration reform so I can find cheaper labor.