What Elon Musk, who works illegally, says about the immigration system

Media reports indicate that Elon Musk worked illegally in America early in his career, illustrating some of the challenges in the U.S. immigration system. The story was seen as ironic given Musk's strong arguments against illegal immigration. Still, the details highlight how difficult it can be for international students and entrepreneurs to obtain legal work authorization in the United States. Compared to his advocacy on other issues, Musk has spent little time advocating for improvements to the U.S. legal immigration system.

Background information on Elon Musk's immigration status

“Long before he became one of Donald Trump's biggest donors and campaign aides, South African-born Elon Musk was working illegally in the United States as he launched his entrepreneurial career after abandoning graduate studies in California, according to court filings from former business partners and corporate documents obtained from The Washington Post“, reported Maria Sacchetti, Faiz Siddiqui and Nick Miroff.

The reporters noted that Musk “did not have the legal right to work” when he founded and raised a company with his brother Kimbal, later called Zip2. Kimbal Musk has long spoken openly about the couple's lack of legal status, even stating in a video interview that he lied about crossing the U.S.-Canadian border to attend a business meeting in Silicon Valley. Immigration lawyer Ira Kurzban said: “This is immigration fraud.” He pointed out that Elon Musk’s brother could have been permanently barred from entering the US. Instead, he became CEO of Musk's first company.

“(Elon) Musk came to Palo Alto in 1995 for graduate studies at Stanford University but never enrolled in classes, instead working on his startup,” the statement said Washington Post. This means that Musk has committed at least two immigration violations. First, he violated his student status by not taking courses. Second, he was not authorized to work legally in the United States.

Musk could not continue to operate a company that accepts venture capital without being legally in the United States and having the right to work. According to the Washington PostMusk was without status for more than a year: “A person who joined Zip2's human resources department in 1997 recalls processing work visas for the Musks and other family members under a category available to Canadians under the North American Free Trade Agreement .”

International students are often denied residency in America

Elon Musk's story tells us a lot about the US immigration system. First, it's not surprising that Elon Musk found that he couldn't stop being an international student and just start working. Today, international students can complete an optional internship, but this does not guarantee that they will be able to be employed in the United States after the OPT expires.

Second, international students typically must obtain H-1B status in order to work long-term. In 1997, employers reached the annual limit for H-1B applications and have done so every year since 2004. For this reason, U.S. Citizenship and Immigration Services uses an H-1B lottery. In recent years, USCIS has selected only about one in four applicants or registrants. The annual H-1B limit is 65,000, plus an exemption of 20,000 for graduates of U.S. universities, which represents only about 0.05% of the U.S. workforce.

Third, the annual cap on employment-based green cards is also low and, combined with a cap per country, can mean that individuals from India may have to wait decades for permanent residency.

There is no immigrant visa for entrepreneurs

In a 2021 interview, Kimbal Musk said he and Elon would have followed the law if it were feasible. “I tried to get a visa, but there’s just no visa you can get for starting a startup,” Kimbal said. “I was definitely illegal.”

Kimbal Musk is right that there is no entrepreneurial visa for immigrants under US law. Congress could have created one as part of the CHIPS and Science Act in 2022. The Democratic majority in the House of Representatives has passed a measure that would allow individuals to obtain permanent residency if they meet certain startup benchmarks, including attracting venture capital. However, Senator Charles Grassley (R-IA) blocked implementation of the provision in a conference committee. Grassley also blocked the bill from providing an exemption from annual green card limits for foreign nationals with doctoral degrees. in science and technology and those with a master’s degree “in a critical industry.”

According to an analysis by the National Foundation for American Policy, 55% of billion-dollar U.S. startups have at least one immigrant founder. Another NFAP study found that immigrants have founded or co-founded nearly two-thirds (65% or 28 of 43) of the top AI companies in the United States. Seventy percent of full-time doctoral students in fields related to artificial intelligence are international students.

Donald Trump is unlikely to liberalize corporate immigration

An analysis of Trump administration policies concluded that Donald Trump did not take or propose any action during his presidency to expand the entry of highly skilled foreign nationals or immigrants into the United States.

A court blocked Trump officials from tightening “unlawful presence” policies for international students who have had their immigration status revoked. Trump's Labor Department has twice proposed rules aimed at barring H-1B visa holders and job-seeking immigrants from the U.S. labor market. H-1B denial rates skyrocketed until a court settlement forced Trump officials to halt the practices judges deemed unlawful. The National Venture Capital Association sued the Trump administration after it refused to implement a program allowing foreign entrepreneurs to stay in America.

Accordingly Assets According to Elon Musk magazine, at least $132 million in political donations were donated, mostly intended for the election of Donald Trump. Musk might be disappointed if he expects Trump to make it easier for immigrants with ambitions like those of a young Elon Musk to succeed in America.