Why America is “Bleeding Competitiveness”

For more on outsourcing, competitiveness, and education, read this month’s Life in Beta column.

For more on outsourcing, competitiveness, and education, read this month’s Life in Beta column.


In the face of a likely double-dip recession, there’s a lot of free-floating anxiety about American competitiveness. As both a tech entrepreneur, a journalist, and an academic with appointments at Duke, Harvard Law, and UC Berkeley, Vivek Wadhwa has a bracing perspective. “America’s the most innovative country in the world,” he says, “but we’re bleeding competitiveness”–not because of our education system, but because of policies that cause talent to flee the country. 

It’s a myth, according to Wadhwa, that our classrooms are subpar–or even if they were, our frat houses make up for it. “America’s education system is by far the best in the world.

India and China’s is really bad!

The ability of Americans to think outside the box, the fact that our children go and party, they have social
skills, means they can innovate.

They understand marketing, how to interact with people. These are skills India and China don’t have.” That’s why, Wadhwa argues, Chinese and Indian students are enrolling in US colleges in record numbers (Indians have shown more preference for the UK in recent years, but the US is still the most popular choice with over 100,000 Indian students.)

The problem, Wadhwa says, is that the overseas talent doesn’t stay here. “It used to be my [international] students at Duke would stay. Now the vast
majority return back home. They have great opportunities so they don’t have to put up with visa
problems. One of my Duke grads said, why should I join the 15-year queue for a green card when your friends back home are becoming managing
directors?”  Restrictions on the H1-B visa for skilled workers began after 9/11 and intensified with the stimulus package passed in 2009. The consequences, he said, are likely to be long-term and severe.


“This whole anti-outsourcing, anti-immigrant paranoia—it’s
hurting America like you don’t believe. If you go to Bangalore or Shanghai you see thousands of startups
that could have been in Silicon Valley. Between 1995 and 2005 50% of our startups were founded by immigrants. Between 2010 and 2020 it’ll be a much smaller number. We’re exporting our talent.” 

The Startup Visa, introduced in this Congress by John Kerry and Mark Udall and backed by a group of VCs including Brad Feld and Fred Wilson, aims to stanch the bleeding. It offers a stay in the country to entrepreneurs who have investment offers in hand and promise to create at least 10 US jobs.


About the author

Anya Kamenetz is the author of Generation Debt (Riverhead, 2006) and DIY U: Edupunks, Edupreneurs, and the Coming Transformation of Higher Education, (Chelsea Green, 2010). Her 2011 ebook The Edupunks’ Guide was funded by the Gates Foundation.