The Road to Immigration Reform

By Steve Case on April 16, 2013
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The introduction today of a bipartisan, comprehensive immigration reform bill in the Senate, which includes strong provisions to help the U.S. recruit and retain the most talented innovators and entrepreneurs from around the world, has me reflecting on a visit to Pittsburgh nearly two years ago. 

We had just concluded a meeting with President Obama and his Jobs Council. For months, Sheryl Sandberg, John Doerr, and I worked on the chapter focused on improving the environment for entrepreneurs to start and scale businesses in the U.S. After studying the issue with McKinsey and Co., reaching out to policymakers on both sides of the aisle, and talking to academics, entrepreneurs, investors, CEOs, labor leaders, and others, we presented to the President. 

Our first recommendation was to “pass reforms aimed directly at allowing the most promising foreign-born entrepreneurs to remain in or relocate to the United States.”

Less than two years later — despite a period of gridlock in Washington — not only is passing comprehensive reform with a provision to win the global battle for the world’s most talented immigrants a real possibility, but additional recommendations proposed that day in Pittsburgh to support entrepreneurs were adopted in the Jumpstart Our Business Startups Act (JOBS Act). 

What changed between October 2011 and April 2013?

Entrepreneurs Become Entrepreneurial…in Washington

The first change since early 2011 relates to categorizing entrepreneurship within the context of public policy. Specifically, entrepreneurs were finally able to differentiate their voices from those of big business and small business. This is important because the data shows that companies less than five years old have created 40 million American jobs since 1980 – nearly all of the net new jobs created during this period. While small, Main Street businesses and large, Fortune 500 companies enable us to maintain employment levels and add vitality to the economy, new businesses founded by entrepreneurs create new jobs.

To his credit, President Obama called on the nation to celebrate, inspire, and accelerate entrepreneurship, and we did. The White House created its Startup America initiative to knock down regulatory barriers standing in the way of new business formation. The private sector responded by creating the Startup America Partnership, which has launched 32 startup regions and built a network of more than 13,000 startup firms. Majority Leader Cantor, and several leading members of the House and Senate, including Sens. Mark Warner (D-VA) and Jerry Moran (R-KS) took the lead on finding policy solutions targeted at helping startups. Entrepreneurs kept up the pressure, and in April 2012, Democrats joined with Republicans and passed the JOBS Act to increase access to capital by legalizing securities-based crowdfunding, making it easier to grow without onerous regulations and access public capital markets to foster innovation and hiring.

But the JOBS Act did something else: it proved to entrepreneurs, Democrats, and Republicans that on an issue as American as apple pie – helping startups create jobs – we can find common ground.

An Opening for Immigration

Which leads us to immigration.

Whereas the JOBS Act addressed capital and regulation, the legislation did not address the most important issue facing entrepreneurs: talent. That is why today's introduction of a comprehensive immigration bill is so critical.  

Forty percent of Fortune 500 companies in the United States were started by immigrants or the children of immigrants. Almost half of Silicon Valley startups in recent years had immigrant founders. Research shows that every 100 additional foreign-born workers in STEM jobs created 262 additional jobs for native U.S. workers. From Chobani Yogurt and Instagram, to Dupont and Google – high-skilled immigrants have given the U.S. an entrepreneurial edge.

But that edge is slipping away.

Every year arbitrary immigration caps force one-third of the foreign-born STEM graduates from our universities to leave the country. After earning advanced degrees, these talented men and women have to relocate to competitor nations to launch businesses that compete with our workers here. We used to encourage the best and the brightest to contribute to America’s economy. Now we attract them, train them, and send them home. This is part of the reason why the percentage of immigrant-founded startups has dropped from 53.4 percent to 43.9 percent in Silicon Valley during recent years. Meanwhile, other countries are making it easier for talented innovators to relocate and create jobs: Canada recently launched a “Startup Visa” program to lure talent from around the world, including from Silicon Valley. Australia, Chile, and China have made smart reforms as well. During the last two years – through the President’s Jobs Council, the National Advisory Council on Innovation and Entrepreneurship, the Startup America Partnership, visits to D.C. by groups of entrepreneurs led by Technet, Compete America, the Kauffman Foundation, Ernst and Young, and others – the message was delivered that we need to reform the system.

New Coalitions Create New Momentum

After the 2012 election, once-unlikely coalitions formed to press for action. The National Immigration Forum, lead by Ali Noorani, has brought together religious leaders, business leaders, labor leaders, and entrepreneurs (or “Bibles, Badges, and Business”) to advocate for reform. The March for Innovation is an effort co-led by Mayor Michael Bloomberg and others to press for action through social media. Most recently, Mark Zuckerberg started an advocacy group that plans to spend heavily on behalf of members of Congress who make brave votes during the immigration debate.

For the entrepreneurship community, the main event remains addressing the talent shortfall. But after a decade of attempting to pass high-skilled reform separately, many of us have concluded that the best opportunity to win passage now – before it is too late — is as part of a comprehensive solution that creates a pathway to citizenship for the more than 11 million undocumented workers currently in the country, strengthens border security, and cracks down on employers who knowingly hire illegal employees. These are challenging legal, social, and moral issues that address divided families, young people who are American in their hearts and way of life but are not legally recognized as part of the American family, and law-abiding immigrants who have to wait while others come illegally. Solving this will not be easy, but policymakers in Washington are showing courage and promise on a critical issue.

The introduction of a comprehensive bill today is a significant step toward improving the environment for entrepreneurship in the U.S. If we continue to make our voices heard and encourage our elected officials to act with urgency, the progress of the last two years will culminate in an historic agreement on immigration reform.  

About Steve Case

Steve Case, chairman and CEO of Revolution, is one of America’s best-known and most accomplished entrepreneurs and philanthropists, and a pioneer in making the Internet part of everyday life.  

 

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