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The Agenda

NRO’s domestic-policy blog, by Reihan Salam.

Derek Khanna on the H-1B Visa System



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Derek Khanna proposes that we increases the number of H-1B visas and allow business enterprises and other institutions to secure these visas through a competitive bidding process:

Competitive bidding would enable the companies that value visas the most to pay for them. And it would help small and medium-sized businesses, which often have the most difficulty filing their paperwork on time and often lose out to big businesses in the competition for the few available visas. Competitive bidding for visas would mean a rational market governed by supply and demand. If as a society we want to “protect” Americans from foreign workers competing for jobs, then perhaps the best way to do that is to put a price-tag differential on the foreign workers.

For example, let’s say we double the number of H-1B visa allotments. If competitive bidding for 170,000 H-1B visas resulted in an average bid of $60,000 per worker, that surcharge would amount to $10.2 billion in government revenue. I would suggest that those funds be used toward deficit reduction, which would appeal to fiscal conservatives who may not already support H-1B visa expansion. Or the funds could be part of an overall tax-reform plan to generate revenue while keeping marginal tax rates low. Some would argue that these funds could be used to pay for new popular spending projects. Microsoft, for example, has advocated that the number and cost of H1-B visas be increased and that the resulting revenue be used toward new STEM (science, technology, engineering, and math) funding. 

It’s a very clear, well-argued piece and I hope you check it out.



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