CNN Money Quotes Murthy in Immigrant Entrepreneurship Article

In a recent posting, the MurthyBlog discussed the prospects for comprehensive immigration reform in 2010, stressing the dangers of postponing action on this issue any longer. As we said in that posting (See: Immigration Reform ASAP, Dec 21, 2009), the economic stakes of inaction have become too high, as foreign workers begin to see enticing career opportunities opening up in their homelands. In other words, we now risk a “reverse brain drain,” exacerbated by the slow economic recovery and the ever-increasing hassle-factor of dealing with immigration red tape. As we have noted previously, the remedy is to make it easier – not harder – for talented individuals to come to the United States and contribute their energy and expertise to our economy.

In a December CNN Money article, Attorney Sheela Murthy addressed this issue head-on, speaking of the frequent audits, investigations, and other intense regulatory scrutiny facing companies that hire foreign nationals. “I have never seen this kind of crackdown on businesses,” Attorney Murthy told CNN Money. (See: Want to Create Jobs? Import Entrepreneurs,” by Jennifer Alsever, CNNMoney.com, Dec 14, 2009.) The article noted the complexity of the immigration paperwork necessary to hire foreign workers, and the perils of a zero-tolerance regulatory environment that can make any mistake extremely costly, running into the thousands of dollars for a single offense. Attorney Murthy commented to CNN Money, “If you don’t dot all your i’s and cross all your t’s, you could be shut down.”

Murthy’s comments showed that, despite the economic benefits of hiring the best minds from overseas, American immigration policy remains fraught with contradictions and conundrums. According to CNN Money, the American high-tech sector – one of our greatest generators of economic growth – not only relies heavily on foreign-born workers, but counts brilliant and creative immigrants among the founders of a quarter of its companies. The article cites a study by Harvard University researcher Vivek Wadhwa, who found that HALF of the founders of high-tech companies in Silicon Valley were born outside the United States!

One would think, says the CNN Money article, that this would spur a greater openness to foreign-born entrepreneurs, but this area of immigration law remains subject to restrictive rules; under the EB5 visa program, international investors are eligible for a green card if they agree to invest at least $500,000 in a business in the United States, and create 10 new jobs. According to CNN Money, to make it easier for talented entrepreneurs to start businesses in the U.S., a California venture capitalist – Paul Graham – has proposed that the U.S. set aside 10,000 new visas a year for entrepreneurs, without the steep entry costs of the current EB5 program.

It remains to be seen whether Graham’s proposal will gain traction in the legislative and regulatory arena, but his point is well taken: we need to redesign the U.S. immigration system so that our economy can continue to attract – and keep – the brightest, most creative minds from around the world. Entrepreneurs are among the boldest and most creative minds of all, and we should make it easier for them to create new businesses here, along with the new jobs we so desperately need.