Saturday, April 28, 2007

Limiting H-1Bs: Economic Suicide

In a prior post, H1-B Aliens and the Myth of Free Labor Markets, I wrote,:

"In my daily meetings with founding teams and start-ups, there is not a single company that does not have an emigre as a key member. The contribution of Indian, Chinese, Russian, Bulgarian and other nationals to our economy is beyond question and a vital source of our success. From professors, to engineers, senior managers, company founders, and venture capitalists, our current success and prosperity is very positively influenced by our ability to attract the best and brightest to work and study in our country.Unfortunately, America, while often a champion of free trade, is not a practioner of free labor markets. While technology talent is perhaps the most important input in Silicon Valley's decades of innovation, the US government artificially caps and limits the number of ambitious immigrants to our economy ."
This week's Economist includes an article titled Deportation Order.
Since 2003, the US government has reduced the number of H1-B visas by 66%; from 195,000 in 2003 to a measley 65,000 this year. Within hours of the application deadline, 150,000 applicants submitted visa requests; a frightening 85,000 on-time applicants lost out to a random number generator that selected the lucky winners.
The article quotes the Harvard Crimson commenting that "many of the foreigners in its class of 2007 have received their deportation orders."
The valley's position as the leading cluster for technology innonvation is contingent on the seamless flow of ideas, capital, and talent. Artifical limits on the ability to source talent will have profound downstream consequences, reducing the quality of innovation, wealth creation, and utility.
If you feel so moved, please reach out to your Congressperson and Senators; for how to contact your House representative click here; for your senator click here. Ask them to eliminate ariticial limits that are keeping the next Sergey Brin's of the world from joining us.


  1. At first I would have disagreed with you regarding H1-Bs but upon further reflection our prototype for the first start-up I began "never" would have worked without the brainpower of the engineers I had working for me that weren't American.

    My engineers were fearless and motivated and they didn't make excuses.

    Thana from Thailand was crucial to the success of the prototype working and the hardware engineering. He had to leave America before the prototype worked because I couldn't sponsor his H1-B Visa and he couldn't find a job.

    We're still seeking funding but we do have a working prototype (that can program VCRs from a computer without using IR thanks to his engineering and a few other devoted engineers including Venkat from India. Other engineers contributed too but they are American citizens fresh out of college.

    It's a touchy issue because hiring and sponsoring an H1-B Visa means an American won't get the job.

    The strange aftereffect now is that all of the engineering for my company Big Bear will be outsourced to Bangalore, India to cut costs and no engineer will actually be done in America.

    Blake Southwood
    Founder of Big Bear and Brontosaurus Software

  2. Patrick9:27 PM

    I just lost a respect for your blog after reading this post. I guess I shouldn't have expected more from a VC. You guys just care about getting the job done the cheapest way. How come every VC out there is b*tching about H1B and not one CEO has really complained about it. I will make you a deal, why don't you work for $70,000 and put your kids in public school and lets see if you are still on your high horse. Second deal: GET OUT OF AMERICA!