Made in America, round two.

Photographer: Jeffrey Sauger/Bloomberg

The Job Creators America Is Keeping Out

Noah Smith is a Bloomberg View columnist. He was an assistant professor of finance at Stony Brook University, and he blogs at Noahpinion.
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Here's a name for you to remember: Yet-Ming Chiang. It's the name of an American hero. 

Yet-Ming Chiang is a professor of materials science at Massachusetts Institute of Technology. Materials science is an unglamorous-sounding field, but Chiang is doing glamorous things. His quest is much the same as Elon Musk's -- to bring cheap, reliable batteries to humankind and to free us from the tyranny of oil. 

In 2001, he co-founded a battery research and manufacturing company called A123 Systems, which manufactured batteries in the U.S. Sadly, demand was inadequate; the company went bankrupt in 2012 and was sold. 

QuickTake Skilled Immigrants

But failure and second chances are an American tradition, and Chiang is back, this time with a new battery company called 24M. It uses all-new technology and, like A123, will put its factories here in the U.S. Check out this piece by Steve LeVine of Quartz for a great read on Chiang, his technology and his company. 

But this isn't an article about batteries. It's an article about immigration. 

Chiang was born in Taiwan and moved to the U.S. -- Brooklyn, to be precise -- when he was 6. If Chiang's family hadn't been allowed to move here, he'd still be living in Taiwan, and all his hard work, genius and entrepreneurial drive would be going to serve the Taiwanese economy. Instead, we let him in, and here he is, creating jobs for Americans and helping build a high-tech, high-value-added industry cluster here. 

The U.S. has a special superpower, which few other nations can match. We can recruit our own heroes. Imagine if only one National Football League team were able to draft players and all the others had to train theirs from birth. You'd want to be that one team, right? Well, that's us. Only a few countries, mostly from the Anglosphere -- Canada, Australia, Singapore -- can match us when it comes to recruiting and assimilating immigrants.

Many of the heroes we recruit are of the everyday variety -- the guy who fixes your roof, the woman who takes care of your kids while you work. That's low-skilled immigration, and it has been good for us. But the other kind -- high-skilled immigration -- is also incredibly important, and that's where we could do a lot better. 

Any immigrant adds to gross domestic product, just like any child being born will eventually add to GDP. But a high-skilled immigrant adds the most. Economists Eric Hanushek, Jens Ruhose and Ludger Woessmann estimate that about one-fifth to one-third of the differences in income among American states can be explained by differences in human capital -- i.e., education and talent. Some of that effect, of course, could be because richer states educate their people more and nurture more talent. But much of it is probably causal: Give people more skills, and the economy benefits. 

The cheapest way to do this is to admit immigrants with high skill levels. Unfortunately, though many do come here, we keep many others out. A recent testimonial in Vox by William Han gives a wrenching illustration of just how broken our system is. Han, a New Zealander, has been living legally in the U.S. for 15 years, studying at Ivy League schools, working as a lawyer, earning a high income and paying his taxes. Despite this stellar record, he is about to be forced to leave, simply because the U.S. doesn't have a system for keeping people like him in the country: 

To the Americans I have known, it really seems that people, or at least law-abiding people like me, should be able to just go down to the DMV, fill out some paperwork, and get citizenship. Time and again I have had to disabuse my friends of this misconception. ... Years spent as a student do not count. Neither do years on a work visa unless your employer is willing to sponsor your green card.

Usually, when we talk about high-skilled immigration, we talk about H1-B visas, which are temporary work visas sponsored by employers. But H1-B is a horrible system. The visas last for three years and can be renewed once, for a total of six years. After that, you need an employer to sponsor you for a green card if you want to stay. The need for H1-B renewal and green card sponsorship leaves high-skilled workers dependent on their employers, almost like indentured servants. 

The problem with H1-B isn't just that it eventually kicks high-skilled immigrants out of the country for no good reason. It's also that by tying high-skilled immigrants to their employers, it prevents them from starting their own companies, like Yet-Ming Chiang did. So although high-skilled immigrants are incredibly entrepreneurial, the H1-B program keeps them competing for your job instead of competing to create new jobs! 

This has to end. Not only do we need to let in lots more high-skilled immigrants, we need to make it much, much easier to get a green card, not an H1-B. We need to create a huge pipeline by which skilled immigrants can apply for their own green cards, without the sponsorship of a company. If we don't do this, a whole generation of American heroes will never become American in the first place.

This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.

To contact the author on this story:
Noah Smith at nsmith150@bloomberg.net

To contact the editor on this story:
Paula Dwyer at pdwyer11@bloomberg.net