The U.S. presidential election quickly seems to be turning into a battle of "who-outsources-least." President Barack Obama has taken to referring to Republican candidate Mitt Romney as an "outsourcing pioneer" during his tenure at private equity firm Bain Capital. The Republican National Committee has countered with a new website accusing Obama of enriching foreign firms and workers with U.S. stimulus money.
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The concern over outsourcing certainly hits a political nerve among the electorate -- and it makes sense during a time of high unemployment. But if the campaigns want to really focus on what accounts for America's sluggish economy, they should spend less time focusing on who is sending jobs overseas and more on who can actually bring skilled workers into the United States -- or keep them there. America's real outsourcing crisis is not firms moving manufacturing to other countries, but the thousands of potential entrepreneurs and job creators who are prevented from setting up shop in America because of immigration laws.
After years of stalemate, recent weeks have seen a number of developments give hope to advocates of U.S. immigration reform. First, Obama stirred the pot with an executive order on June 15 calling on federal law enforcement to stop prosecuting the offspring of illegal immigrants -- children who likely would have qualified for the perennially politically challenged DREAM Act, which would establish a path to citizenship for upstanding people brought into the country by illegal-immigrant parents. Obama's order at least ensures that these young people can remain in the United States and work without fear of deportation.
Then, the U.S. Supreme Court struck down key parts of Arizona's SB 1070, a draconian piece of legislation that turned the entire state into a "stop-and-frisk" zone for anyone unlucky enough to possess nonwhite ethnic facial features. The law also forced the hand of law enforcement agencies, essentially mandating arrest for anyone who failed to produce the precisely required papers. (In fact, a similar law in Alabama snared Japanese and German automotive executives tending their stateside factories. It made for a funny news story, but incredibly shortsighted economic policy.)
However, the most important reason to revisit immigration reform has largely remained off the political radar: namely, that high-skilled immigrants could provide a tremendous boost to the U.S. economy in a very short period at virtually no cost to taxpayers. It's taken as a truism in American politics that start-ups and small companies drive the majority of the country's new economic growth and job growth. The pundit class has repeated ad nauseam that the economy and unemployment numbers will likely make or break Obama's reelection campaign. But frozen by fears of a nativist backlash, both Obama and Romney have refused to discuss immigration as an economic issue.
Maybe they should. Research indicates that immigrant entrepreneurs have achieved astonishing inroads in launching technology start-ups in the United States. Foreign-born immigrants dominate the ranks of technology entrepreneurs in Silicon Valley. In U.S. postgraduate programs in hard sciences, foreign-born students comprise more than 50 percent of classes focused on science, technology, engineering, and mathematics (STEM). And these students want to remain and build businesses in America -- if the country lets them. So it seems like a no-brainer. Let in more high-skilled immigrants to stoke the U.S. economy and pander to a fast-growing political base. In fact, the only constituencies that arguably would not benefit from America's allowing in more skilled workers would be countries like China, India, and Brazil, which are currently benefiting the most from the legions of U.S.-educated and U.S.-trained workers who are returning home and boosting innovation and entrepreneurship there.
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