[subhobroto]

> Ultimately, companies who use H1B visas will outcompete companies who don't because the H1B system gives them cheaper labor costs. The solution has to come at the regulatory level.

I have utmost respect of your work, a customer of your fantastic product and have been meaning to reach out to you for a while (infact I learned about Cory from your blog in 2021) but I had to push back hard on this.

TinyPilot didn't happen in India nor China. I can argue it would have been cheaper to build it at any one of those countries but you know much better about it than I.

Labor costs only matter when you're selling an absolute commodity that has no edge than price.

Of all the people I would have expected to say that the solution has to come at the regulatory level given the experience, success you've had, with your transparency in how your company was doing, I am utterly surprised it was you.

I am more than happy to continue, reached out - I just wish our initial email would have been way more pleasant!

[mtlynch]

Thanks for the kind words!

To clarify, I certainly agree it's possible for a business to succeed without using H1B visas, especially for something small at the the scale of TinyPilot (7 people when I sold).

I just mean on a large scale, the companies that use H1B visas will generally outcompete the ones that don't.

What's the cost difference between a US citizen and an H1B? I'd guess it's something around 20% less expensive to hire an H1B visa holder. In an industry like software where the dominant cost is labor, then H1B companies have a 20% advantage over non-H1B companies. Non-H1B companies can outcompete them by being 20% better, but that's a big disadvantage to overcome.

Running my business actually made me oppose H1B visas more. The H1B visa system gives big businesses a massive advantage over small businesses. There's so much frictional cost to hiring someone on an H1B visa (legal fees, admin overhead) that it's not practical if you're only hiring 1-2 employees, but you'll get ROI if you're hiring 10-20. But it just gives an advantage to bigger business, and the advantage wouldn't exist if the H1B system didn't exist or if the government designed it to be employer-agnostic.

[subhobroto]

> Thanks for the kind words!

You deserve and earned them!

> There's so much frictional cost to hiring someone on an H1B visa (legal fees, admin overhead) that it's not practical if you're only hiring 1-2 employees

Very true but as you saw in my email, I have extremely experienced friends back in India who I have been able to hire as contractors without issue. No H1B - just plain old Slack, email and Forgejo. The playbook for asynchronous work is well tested and debugged by now. 2019 was a blessing.

I will concede, this doesn't work for every company - a hardware or biotech company definitely would appreciate people all being together in the same physical lab, in which case I hear you!

> the government designed it to be employer-agnostic

... but the government cannot be employer-agnostic, Michael.

The government is not an impartial, unbiased mainframe running in a DC somewhere. It's a group of people accepting and pushing policy who can be influenced, just like I am influencing your today, and you, me.

As an SMB and bootstrapped founder, you then have to choose between spending your time and efforts on being at the influencing table vs making actual design and business decisions at your startup the moment you yield influence to this group.

The bigger business simply doesn't have to make that decision. So don't help tip the scales further against yourself and SMBs like you.

That's one of my points that I was hoping to discuss in our email - that involving the government adds further overhead, resistance and expense into the system, so we should exhaust all other options before we even consider it. I personally have never seen an option that needed government intervention that couldn't be solved by the free market. I don't work in healthcare or education or finance - maybe those do require government intervention - I am entirely unfamiliar about those domains and not talking about them.

The other interpretation of being employer-agnostic is that the H1B isn't tied to a "sponsoring company" and doesn't require any of the transfer shenanigans. Sure, but the issue it isn't that way is because it's a rare "dual intention" visa in that, you are a non-immigrant who can become a citizen through the H1B. This was a feature added to the H1B to entice top quality talent. The problem with making the H1B employer-agnostic is that now you can I can start a perfectly legal, fantastic lifestyle businesses hiring H1Bs, petitioning for their greencards and immediately letting them go. As long as they can figure out a way to eat and sleep, they can now become citizens. So for it to be employer-agnostic, we need to remove the "dual intention" - the very carrot employers use (if you tough it out through all those JIRA tickets, you'll get to be a citizen!)

> I just mean on a large scale, the companies that use H1B visas will generally outcompete the ones that don't.

This is where I continue to push back. I was hoping to discuss over email but do you feel you could have built TinyPilot at either MS or Google, not as a side project but as an official product offering? I don't want to get too tied up into the specific features that TinyPilot offers - I'm using it as a proxy for a very useful, innovative product that provably solves real customer problems.

At the large scales where H1B makes sense, you as a major decision maker at the company wouldn't allow a worker with a risky status like the H1B be responsible for high impact, meaningful pieces of work. Actually, forget H1Bs - at the large scales where H1B makes sense, you would simply not entrust a single individual, H1B or not, with high impact, meaningful pieces of work.

If we disagree on this take, please say so - I am here to learn and listen.

The original intention of the H1B was to handle temporary supply shocks in knowledge work while the U.S. slowly fixed those supply constraints on its own.

If avocado toasts became an overnight sensation, the H1B was a way to provide breathing room to local avocado farms so the demand could sustain or grow (and not collapse) while they came up to speed to meet that sudden demand.

The H1B wasn't designed to be a way to absolutely wipe out local avocado farms because it's cheaper to just import avocados from Mexico.

The H1B has completely diverged from that and going in the opposite direction where it's actively and negatively impacting domestic markets. Massive corporations in Asia have grown whose sole business model is exploiting this geographical arbitrage and nothing else.

What piece of critical, useful software that has had a mention on HN can you name or recall that has come out of these many mutibillion dollar outsourcing giants?

A $60k/yr salary as a resident doctor is fantastic if you did most of your education in Asia but if you attended medical school anywhere in the U.S. and didn't have a 100% scholarship, you're starting your life off in crippling debt.

During COVID, there was an explosion of domestic coding bootcamps to address the supply constraints - this is precisely the kind of domestic corrections we, as the U.S. need to encourage and develop local talent, get them educated and motivated about tech, but these bootcamps require an investment that in Asia covers education, boarding and lodging without any scholarship. There's just no competition when it comes to cost. We in the U.S. have an extremely high quality of living and our CoL reflects that. As I wrote in my email, things we take for granted here - running water (not potable, just water that you could water your plants with), 24x7 electricity and internet - these are still unavailable where I was born, so of course, the CoL is cheaper. Way cheaper.

One might say, "OK then, free markets for the win" - that itself is a separate debate on its own.

[mtlynch]

>> the government designed it to be employer-agnostic

> The other interpretation of being employer-agnostic is that the H1B isn't tied to a "sponsoring company" and doesn't require any of the transfer shenanigans.

Right, this is what I was talking about.

I think the current system gives H1B employers way too much leverage over H1B employees and degrades the job market for everyone. Employers can tell H1Bs that they have to work evenings and weekends or be fired and leave the country. And then the same employer can turn around and tell US citizen employees that they also have to work evenings and weekends because the H1B employees are doing it. They have less leverage over the citizens because the citizens can get another job more easily, but forcing H1Bs to establish precedent definitely does pressure other employees, and I've seen this happen directly.

> So for it to be employer-agnostic, we need to remove the "dual intention" - the very carrot employers use (if you tough it out through all those JIRA tickets, you'll get to be a citizen!)

I think you could design it without such an obvious loophole, but I agree that there are probably loopholes no matter how you design it.

That said, I'm a bit confused about our disagreement at this point.

I think the H1B system is a net negative for the US economy, and it disproportionately hurts small businesses. I'd be in favor of a revised H1B system that allows companies to fill short-term labor shortages with foreign workers but with limits that prevent companies from abusing the system to depress wages and conditions for US workers, as they currently do with H1B today.

It sounds like your argument is that H1B doesn't matter because the companies using it aren't really innovating and so they'll naturally be outcompeted by smaller businesses who are too small to take advantage of the H1B system. Is that correct?

Also, I'm confused because you're saying you advocate free market solutions and that's why we shouldn't mess with the H1B system. The H1B system is the opposite of a free market solution. It's extra regulation that we'd be better off without.

[subhobroto]

Michael, Thank You for reading and responding back.

We disagree on the diagnosis and path forward, not the symptoms. Let me explain:

> I think the current system gives H1B employers way too much leverage over H1B employees and degrades the job market for everyone

Correct and it's by design. The overhead of H1B needs to be in the black when it hits the bottomline - the H1B isn't a charity auction to take brilliant engineers from developing countries and move them into the U.S. - it's to ensure the companies turn a profit on it.

> I think the H1B system is a net negative for the US economy, and it disproportionately hurts small businesses

Correct again on both accounts. While it is a brilliant solution 1% of the time, it's misused 99% of the time.

> It sounds like your argument is that H1B doesn't matter because the companies using it aren't really innovating and so they'll naturally be outcompeted by smaller businesses who are too small to take advantage of the H1B system. Is that correct?

Correct again

> you're saying you advocate free market solutions and that's why we shouldn't mess with the H1B system. The H1B system is the opposite of a free market solution. It's extra regulation that we'd be better off without

Correct again

Where I disagree with you is when you said we need to add more regulation to the existing H1B system. To me, and this is not something I'm hearing for the first time, it sounds like a band aid on top of a bunch of band aids 12 feet deep.

The H1B system was wonderful when it was initially implemented. The U.S. was undergoing massive technological shifts leading to tremendous supply shocks - just like how we are struggling to purchase GPUs, RAM and SSD today. As much as we disagree, history has proven repeatedly this shock will pass (unless the market is distorted by new regulation).

However the H1B has long since distorted into a geo-arbitrage, QoL and CoL hack. Even the current administration's $100k fee is a bandaid. Just the fully loaded cost of a 4-6 year domestic education is more than that, so the domestic supply is being destroyed.

Ideally what should happen is we should decommission the H1B completely, no ifs and buts, and have a "cool down" period where we notice what impact it actually has on the domestic demand. I do appreciate that this isn't accounting for the case where there are only a 1000 people worldwide who know how to train an LLM from scratch, or, 1000 toptier cardiologists worldwide that we would like to attract - I'm very sure we will figure something out for them but I argue we need to discover why our domestic supply is lacking in the first place instead of continuing to rely on band aids.

The U.S. today seems to rely on stents to save it from heart attacks. We should probably take a strong, hard look at the diet and lifestyle choices instead of continuing to rely on stents as a savior. It was necessary when we had an emergency, but a sustained reliance on emergency intervention points to underlying structural issues.