A bipartisan quartet of freshman senators on Capitol Hill has taken on two challenges: bolstering America's position as the world's most entrepreneurial nation and proving that Congress can get something done in an election year. It's a toss-up which challenge is the tougher one.
The senators-Republicans Marco Rubio of Florida and Jerry Moran of Kansas and Democrats Chris Coons of Delaware and Mark Warner of Virginia-last week unveiled the Startup Act 2.0, which aims to spur creation of new companies. Why focus on startups? Because new firms have generated nearly all net new U.S. jobs for the past 25 years or more. Citing research by the Ewing Marion Kauffman Foundation, the senators say startups have averaged 3 million new jobs annually.
It would be hard to find anyone in Congress who doesn't support job creation. But that doesn't mean the Startup Act 2.0 is a sure bet. Here's why: Several key provisions would increase the number of immigrants allowed to stay in this country permanently.
One would create a STEM visa for U.S.-educated foreign students who graduate with a master's or Ph.D. in science, technology, engineering or mathematics, paving the way for a green card. Another provision calls for an entrepreneur's visa for legal immigrants who launch businesses and create jobs.
In Congress and elsewhere, some oppose expansion of visas for highly skilled immigrants, fearing this would deprive Americans of highly paid jobs. This argument ignores the fact that many Americans today are employed thanks to the efforts of foreign-born entrepreneurs-Google Inc.'s Sergey Brin and Yahoo Inc.'s Jerry Yang being two obvious examples.
The legislation helpfully contains other provisions that should enjoy broad support, such as a permanent exemption of capital gains taxes on the sale of startup stock held for at least five years and the use of existing federal R&D funding to boost university initiatives that bring innovative research to market faster.
One of the bill's many private-sector supporters, America Online co-founder Steve Case, said that "winning the global battle for talent is essential if we are going to keep our entrepreneurial economy moving forward."
That's clearly true. It's equally clear that the Startup Act 2.0 would greatly help that effort.
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