Las Vegas Sun

July 18, 2019

Currently: 83° — Complete forecast

Sun editorial:

Killing international entrepreneur rule would be bad for US, Nevada

The Trump administration’s irrationality on immigration policy could soon hurt Las Vegas and the American economy at large in a new and profound way.

The blow would come if the Department of Homeland Security follows expectations and kills an Obama-era program that created a pathway for foreign entrepreneurs to launch startups in the U.S. The program, known as the international entrepreneur rule, offers temporary parole that allows business operators to locate to the U.S. and remain in business as long as their operations hit performance targets in revenue, employment and other matters of scale.

It’s simply beyond belief that the administration is bringing down the ax on the program. Let’s get this straight: Entrepreneurs want to come here, start businesses, expand them and build our economy, and we’re stiff-arming them?

Leave it to the Trump administration to find yet another way to cut off our nose to spite our face.

“Immigrant entrepreneurs create American jobs,” Gary Shapiro, the head of the company that produces the massive CES convention in Las Vegas, wrote in a public comment to DHS. “A 2016 study from the National Foundation for American Policy shows immigrants founded just over half of America’s billion-dollar startups. Today, 1.7 million Americans work at top tech companies founded by immigrants or the children of immigrants, and these companies added an average of 760 jobs apiece to our economy. Our industry shares the administration’s commitment to job creation and economic growth, but rescinding the IER runs counter to that commitment. Scrapping this rule will leave American jobs on the table.”

Shapiro is right, which is why the rollback has drawn concerns from a number of major businesses and business organizations — Dell, the U.S. Chamber of Commerce, the National Venture Capital Association, the Center for American Entrepreneurship and many more. DHS received more than 1,500 remarks during a public comment session that closed June 28, and the vast majority were in favor of the program.

So what’s the administration’s reasoning behind the rollback? DHS says parole is “not the appropriate vehicle” to recruit entrepreneurs — meaning DHS prefers a visa process — and doesn’t provide adequate protections for investors and workers in businesses operating under temporary status.

But that’s weak rationale for ending the program. It may not be the ideal solution, but it can work until a better alternative is developed.

On the other hand, eliminating it now sends a message to business operators to stay away — or, worse yet, locate to another nation that welcomes them.

Think about that. Not only will eliminating the program hinder efforts to diversify Nevada’s economy by building a tech industry here, but it threatens to curtail growth among the companies that fuel the biggest annual convention in Las Vegas. Given the importance of CES in the Las Vegas economy, that’s a major concern.

It’s all so pointless. It’s not as if the program had been abused by unqualified immigrants seeking a way to cheat the process — it was created in the final days of the Obama administration, and implementation was delayed. As a result, it’s yielded only about a dozen applications.

Meanwhile, DHS estimated that 2,940 entrepreneurs would be eligible to launch startups under the program if it were fully implemented.

Who knows how many of those entrepreneurs might have transformational ideas? For an idea of what we could be missing out on, consider this list from of American businesses founded by immigrants: Google, eBay, Tesla, Yahoo, AT&T, Procter & Gamble, and Pfizer. And that’s just a start.

“In 2017, America’s top 500 companies brought home $12.1 trillion in revenue, and more than 40 percent of those earnings came from companies founded by immigrants or their children,” reported.

The National Venture Capital Association, which sued DHS over the delay in implementation, may have put it best:

“These startup companies are the key catalyst of job growth in America,” it said in a public comment.

The good news is that DHS has not made a ruling on whether to eliminate the program, and has not set a timetable for a decision.

That being the case, Nevada’s congressional delegates need to do two things. One is to pressure the administration keep the program in place. Two is to take the matter out of the administration’s hands by exploring legislation like the bipartisan startup act that was introduced in the House last fall, which would offer entrepreneur and STEM visas for highly education individuals to work in the U.S.

That bill isn’t perfect either, but it’s worth working on. The Trump administration simply can’t be left to its own devices on this.