55% of America’s Top Startups Were Founded by Immigrants. Why Won’t Congress Let in More?
“Immigrants are 80 percent more likely than native-born Americans to found a firm, according to a study released this May by researchers from the Massachusetts Institute of Technology. But more than that, a report released this week by the National Foundation for American Policy (NFAP) indicates that immigrants are disproportionately responsible for starting high-value companies.
According to the NFAP, a nonprofit that researches trade and immigration, immigrants have started 319 of 582, or 55 percent, of America’s privately-held startups valued at $1 billion or more. Over two-thirds of the 582 companies “were founded or cofounded by immigrants or the children of immigrants,” notes the NFAP. For comparison, approximately 14 percent of America’s population is foreign-born.
Together, the immigrant-founded companies are valued at $1.2 trillion and employ 859 people on average. Elon Musk’s SpaceX has the largest valuation at $125 billion, employing 12,000 workers; Gopuff, a food delivery service valued at $15 billion, has 15,000 employees; Stripe, a payment platform valued at $95 billion, employs 7,000; and Instacart, a grocery delivery service valued at $39 billion, has 3,000 workers.
These findings are notable, the NFAP points out, since “there is generally no reliable way under U.S. immigration law for foreign nationals to start a business and remain in the country after founding a company.” A large share of the immigrant startup founders came to the country as refugees, on family-sponsored green cards, or through employment-based pathways for other companies.
“Our employment-based pathways for immigrant entrepreneurship are so poorly designed, migrant businesses are often associated with non–employment based pathways,” points out Sam Peak, an immigration policy analyst at Americans for Prosperity. Peak notes that refugees “have the highest rates of entrepreneurship of any other immigrant group,” and family-based migration, “especially among siblings, is also strongly tied to new business formation.”
Lawmakers have introduced a number of measures this year meant to bring more entrepreneurial and highly educated immigrants to the United States, but many of these have been included in—and eventually stripped from—larger bills.”
Europe’s Energy Wounds Are Self-Inflicted
“”In 2000, Germany launched a deliberately targeted program to decarbonize its primary energy supply, a plan more ambitious than anything seen anywhere else,” Vaclav Smil wrote in 2020 for the Institute of Electrical and Electronics Engineers’ IEEE Spectrum. “The policy, called the Energiewende, is rooted in Germany’s naturalistic and romantic tradition, reflected in the rise of the Green Party and, more recently, in public opposition to nuclear electricity generation.”
The problem, as Smil noted, is that government-favored and subsidized solar and wind are intermittent. Wind doesn’t generate electricity when the air is still, and solar is of little use at night and on cloudy days. That means old-school generating capacity has to be maintained in parallel to the new systems.
“It costs Germany a great deal to maintain such an excess of installed power,” Smil added. “The average cost of electricity for German households has doubled since 2000. By 2019, households had to pay 34 U.S. cents per kilowatt-hour, compared to 22 cents per kilowatt-hour in France and 13 cents in the United States.”
The German news magazine Der Spiegel came to a similar conclusion in 2019.
“The state has redistributed gigantic sums of money, with the [Renewable Energy Sources Act] directing more than 25 billion euros each year to the operators of renewable energy facilities,” the authors observed. “But without the subsidies, operating wind turbines and solar parks will hardly be worth it anymore. As is so often the case with such subsidies: They trigger an artificial boom that burns fast and leaves nothing but scorched earth in their wake.”
Making the matter worse is the extent to which Europe has sourced its fossil fuels from Russia. That’s a dependency partly based on easy accessibility by land to Russia’s resources. It’s also an artifact of economic diplomacy from the Cold War era intended to build trade ties to reduce the risk of conflict. But what was supposed to give the West leverage over the old Soviet Union has instead handed modern Russia enormous clout.
Comparatively clean nuclear energy might have made the difference, but the 2011 Fukushima disaster spooked Germans more, perhaps, than people anywhere else, and the country resolved to abandon nuclear power, leaving it dependent on unreliable solar and wind and, especially, imported fossil fuels. Only now, with Russia throttling the supply of natural gas to 20 percent of capacity, is the governing coalition considering extending the life of the last two nuclear power plants past the end of the year.”
Mitt Romney’s Family Plan Isn’t Great, but It May Be Better Than the Alternatives
“According to Sen. Mitt Romney (R–Utah), America’s current welfare policies have two major flaws: They penalize recipients who get married by reducing the benefits they’re eligible for, and they don’t do enough to help couples afford to have more kids.
“There’s a growing gap between the number of children people say they want to have and the number they actually decide to have,” he said during an event yesterday at the American Enterprise Institute (AEI) in Washington, D.C. “Just to be clear here, I don’t think the goal of policy should be to try to create incentives to have people have more children than they want, but instead should find a way to bridge the gap between what people would like to add to their family and what they’re able to afford.”
Attempting to address these issues, Romney in June released the Family Security Act 2.0, a proposal to send parents monthly checks of between $250 and $700 per child, beginning midway through a pregnancy. A household would need to have earned at least $10,000 the previous year to be eligible for the full benefit, a provision meant to keep families from dropping out of the work force entirely. The program would be “paid for” by reducing or eliminating various existing income tax breaks.
It’s hard to fault efforts to resolve distortions introduced by previous federal policy, including the whoopsie-daisy of incentivizing low-income couples to remain unmarried. The idea that it’s the government’s job to help people have more kids rests on a more debatable assumption—namely, that parents should not have to shoulder the full cost of raising future members of society.
Regardless of whether you buy that “positive externalities” argument, the federal government does spend billions each year on family programs. Given that these efforts are not likely to go away (however much libertarian purists might wish otherwise), it’s worth considering whether Romney’s proposal represents at least an incremental improvement over the status quo.”
Another Centrist Project Offers Mushy Technocracy To Soothe a Divided Country
“In interviews with Reason and elsewhere, Andrew Yang, the most recently prominent of the Forward Party organizers, comes off as a sincere, solutions-oriented guy. But it’s not obvious that he recognizes that Americans of conflicting values and preferences want to live in different ways and by divergent rules. That blindness is apparent in the claim that “Every problem has a solution most Americans can support (really).” What if we can’t even agree on what constitutes a problem? What happens when the solutions embraced by some repulse others?
Like most centrist technocrats, the organizers of the Forward Party mistake governance for an engineering problem that requires a few tweaks to get it properly running. But governing involves messy moral arguments over the use of coercive force. Political debate assumes ongoing disagreement, and if people are sufficiently at-odds, there may be no easy solutions, let alone “commonsense” ones.”
Industrial Policy Stifles Progress When Congress picks winners, we all lose.
“To armchair economists, industrial policy seems like a solution for the country’s economic woes: “Infuse money into Industry A, add trade protections for Industry B, protect workers in Industry C from automation, and the economy will soar! New technology will arrive sooner, domestic firms will outcompete foreigners, and steady employment will ensure a chicken in every pot.” That indeed was the thinking behind Depression-era policies which extended that crisis by seven years.
Economies are not deterministic like physics or chemistry. You can’t pull a lever to achieve a particular effect. A better analog is biological or ecological systems, where there are second- and third-order effects to any given stimulus.
Think about the reintroduction of wolves to Yellowstone National Park: Increased predatory pressure keeps elk herds on the move, leaving more young willow trees for beavers. Growing beaver populations dam more waterways, altering the habitat and spurring additional difficult-to-predict effects. That’s economic policy: You must plan for unexpected downstream effects (pun intended).
That thinking has been missing in Congress this past month. I don’t know what microchip subsidies or a mistitled inflation-fighting bill will ultimately do, but neither do our elected officials.
Compounding the problem is that people, not some agnostic supercomputer, determine which industries and companies are considered worthy of a boost. Humans are subject to influence and pressure, turning industrial policy into a contest of who can secure the most government favoritism—a political game of Hungry Hungry Hippos.
Policies protecting companies from competitive pressure, like subsidies or tariffs, allow them to take their eye off the ball. This “X-inefficiency” means they’re less efficient and pay less attention to customers’ desires.”
California’s Drought Is an Infrastructure Problem
“policymakers spend too much time worrying about how much water Californians use to run their households—and too little time figuring out how to bring more water into our system. The state hasn’t built significant water infrastructure since Didion penned that essay—when the state had
The Democrats’ New Inflation Bill Includes Tax Credits for Electric Vehicles That Don’t Exist
“The bill also puts restrictions on which EVs can qualify. Starting in 2024, an EV that qualifies for the full rebate amount must source at least 40 percent of its battery’s components—including minerals such as lithium, cobalt, manganese, and graphite—from either the U.S. or a country with which the U.S. has a trade agreement. Also starting in 2024, no minerals can be sourced from a “foreign entity of concern,” such as China.
The stipulation was part of a compromise with Sen. Joe Manchin (D–W.Va.), whose support was critical to the bill’s passage. Manchin insisted that the bill take a hard line on China, telling reporters: “I don’t believe that we should be building a transportation mode on the backs of foreign supply chains. I’m not going to do it.”
But 60–80 percent of EV batteries’ mineral ingredients are controlled by China. That country currently produces 76 percent of the world’s lithium-ion batteries, while the U.S. produces only 8 percent. Despite ambitious plans to scale up, the U.S. and Europe together will likely account for only about a quarter of total global production of EV component minerals by 2030.”
…
“Politico suggests that the government can simply get around these strictures by issuing waivers, much as it has done for steel tariffs. In practice, steel waivers incentivized cronyism, with Washington bureaucrats picking and choosing which companies received waivers and which did not. And if a law has problems, surely the best place to deal with that is in the text of the legislation itself, not an unstated hope that the administrative state will fix the issues when they arise.”
America Needs More Foreign STEM Talent To Produce Semiconductors. The CHIPS Act Won’t Fix That.
“”The U.S. currently does not produce enough doctorates and master’s degrees in the science, technology, engineering and math fields who can go on to work in U.S.-based microchip plants,” write Brendan Bordelon and Eleanor Mueller for Politico. “The U.S. now produces fewer native-born recipients of advanced STEM degrees than most of its international rivals.”
According to a report from Eightfold AI, which runs a work force artificial intelligence platform,* the U.S. would need to fill between 70,000 and 90,000 fabrication jobs in order to have the numbers necessary for critical applications. And chipmakers are already struggling due to the insufficient availability of workers—the Taiwanese Semiconductor Manufacturing Corporation had aimed to open a new chip fabrication facility in Arizona this September, but had to delay the opening by six months due in part to a labor shortage.
Though the CHIPS Act carries a hefty price tag, it’ll do little to solve the underlying labor shortage that’s stymying domestic production in the short term. All 17 of the semiconductor experts surveyed by the Government Accountability Office noted the need to implement work force development policies, and many specifically suggested immigration reform. The CHIPS Act’s proponents argue that key provisions would help encourage native-born Americans to enter STEM fields and boost the semiconductor labor force down the road. But lawmakers intent on boosting chip manufacturing in the near future would be foolish to neglect foreign talent—much of which is already on American soil.
Allowing foreign-born students educated in STEM fields at American universities to stay in the country could help alleviate the labor shortages that semiconductor firms are facing.”
Ron DeSantis Oversteps His Authority by Suspending Tampa’s Elected Prosecutor
“As Florida Gov. Ron DeSantis continues his culture war campaign against abortion providers and members of the LGBT community, prosecutors who choose to defy the governor’s edicts may soon find themselves out of a job.
Last Thursday, DeSantis signed an executive order suspending Hillsborough County State Attorney Andrew Warren, a progressive prosecutor who had previously pledged his office would not prosecute women seeking abortions or pursue criminal charges against those pursuing gender-affirming health care. “State Attorneys have a duty to prosecute crimes as defined in Florida law, not to pick and choose which laws to enforce based on his personal agenda,” DeSantis said in a statement.
Warren was first elected in 2016, defeating a longtime Republican incumbent with the support of liberal donor George Soros. Despite clashing with law enforcement over his refusal to prosecute minor offenses, Warren was reelected in 2020. Warren has said he will fight the governor’s suspension in court.
Article 4, Section 7 of the Florida Constitution allows the governor to suspend local officials for “malfeasance, misfeasance, neglect of duty, drunkenness, incompetence, permanent inability to perform official duties, or commission of a felony” and to appoint a temporary successor. The Florida Senate must approve a permanent removal from office and confirm the governor’s replacement appointments.
Previous governors have reserved that power for extreme cases of incompetence and malfeasance. In the last weeks of his governorship, then-Gov. Rick Scott, a Republican, suspended Broward County Supervisor of Elections Brenda Snipes, a Democrat, after her office came under fire for its mismanagement of the 2018 midterm elections.
Snipes was the second consecutive Broward elections chief to receive a pink slip from Tallahassee; her predecessor, Miriam Oliphant, had been suspended by then-Gov. Jeb Bush in September 2003 after a task force report investigating her disastrous handling of the 2002 elections* revealed countless administrative failures in the county elections office, including hundreds of uncounted ballots found in filing cabinets and a gravely understaffed office. Neighboring Palm Beach County also saw their elections supervisor, Susan Bucher, receive the boot in January 2019, this time from DeSantis. Snipes and Bucher both resigned from their positions.
DeSantis also suspended embattled Broward County Sheriff Scott Israel early in his tenure, after an investigation into the 2018 Marjorie Stoneman Douglas High School Shooting found Israel and the Broward Sheriff’s Office responded to the massacre with “incompetence” and “negligence.” He then appointed Coral Springs Sergeant Gregory Tony as Israel’s replacement. The Florida Senate officially removed Israel from office in October 2019.
However, suspending a prosecutor for using their discretion sets a troubling precedent. Many prosecutors across the U.S., including federal prosecutors, prioritize their resources to go after offenders who pose a threat to public safety and civil society. It is simply not possible for prosecutors to devote equal resources to every type of offense.
Even when prosecutors adopt policies that seem political, the governor has less extreme tools for making sure that justice is done. When former Orange-Osceola County State Attorney Aramis Ayala, a Democrat now running for state attorney general, announced that her office would no longer pursue the death penalty, Gov. Scott reassigned 30 murder cases to a different State Attorney, prompting Ayala to sue.
The Florida Supreme Court ruled that Scott’s decision to reassign cases from Ayala’s office was a legitimate use of the governor’s powers. “The executive orders reassigning the death-penalty eligible cases in the Ninth Circuit to King fall well ‘within the bounds’ of the Governor’s ‘broad authority,'” the majority opinion explained. DeSantis himself used that same ruling to reassign homicide cases from Ayala’s office in 2020. However, neither governor suspended or removed her from her position.
What’s more, DeSantis has declined to use his executive authority to suspend sheriffs who refused to enforce gun restrictions. Meanwhile, DeSantis has allowed state education officials to ignore federal anti-discrimination laws designed to protect LGBT students and teachers in Florida public schools.
Many lawmakers have expressed concerns that the suspension encroaches on the separation of powers between the governor and local governments in the state, something they see as contradicting DeSantis’ messaging advertising his vision of a “free Florida.”
“Removing a duly elected official should be based on egregious actions—not political statements,” Tampa Mayor Jane Castor tweeted in response to the governor’s executive order. Like many Democrats in the state, she believes that the governor is thwarting the will of voters in her city by suspending Warren. “In a free state, voters should choose their elected officials.””