U.S. Signals Major Immigration Change: H-1B “Scam” to be Replaced

Commerce Secretary Howard Lutnick has stated that the U.S. plans to undertake a significant overhaul of its immigration system, specifically targeting the H-1B visa and Green Card processes. Describing the current H-1B system as a “scam,” Lutnick argues the proposed reforms are a necessary shift towards a more merit-based, wage-driven model. The current system’s reliance on a random lottery is a key point of contention for the administration.

The Proposed H-1B and Green Card Overhaul

The core of the proposed changes involves replacing the existing lottery system with a new framework that prioritizes high-earning applicants. This would essentially allocate H-1B visas based on wage levels, with higher-paying jobs being selected first. The goal, according to Lutnick, is to ensure the program attracts “the best people” and prevents its alleged misuse by companies to bring in lower-paid foreign labor at the expense of American workers. He pointed out that the average salary for a Green Card recipient is lower than the average American salary, arguing this signals a flawed system.

The administration is also reportedly considering a “Gold Card” program, which would grant permanent residency to foreign nationals who invest a minimum of $5 million in the United States. This initiative is positioned as a way to attract significant wealth and talent, thereby boosting the American economy.

Potential Impacts and Criticisms

These proposed reforms have sparked considerable debate. Proponents, including the administration, say this shift aligns with the “Buy American, Hire American” policy, ensuring that the U.S. immigration system benefits the national economy and protects American jobs. By prioritizing higher-paid workers, the new system is intended to attract top-tier global talent.

However, critics warn of potential negative consequences. Many in the tech industry and other sectors that heavily rely on foreign talent argue that a wage-based system could disproportionately affect smaller companies and startups, which may not be able to offer the high salaries that would be prioritized under the new system. Additionally, those who have recently graduated and are seeking entry-level positions would be at a significant disadvantage. India is particularly affected by these changes, as its nationals make up the majority of H-1B visa recipients. Critics suggest that restricting access to skilled foreign workers could lead to jobs being outsourced or filled by remote workers in other countries, rather than being filled by American citizens. This is not the first time such changes have been proposed. An earlier attempt to implement a similar wage-based system was withdrawn by a previous administration following widespread opposition and legal challenges.

What’s Next?

A draft rule for the new weighted selection process has already been approved by a U.S. government office. While this is a step forward, the rule would still need to go through a public comment period before being finalized. The final form and implementation of the proposed changes remain uncertain, and they could face legal challenges, as was the case with similar efforts in the past. This development marks a clear policy direction for the administration, focusing on attracting high-skilled individuals and investors while aiming to reshape the H-1B and Green Card programs.