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February 6, 2017 24 mins

On his eighth day in office, President Trump signed an executive order banning the U.S. entry of people from seven Muslim-majority countries. The move sparked outrage from several tech companies, which rely heavily on the talent of skilled foreigners. This week, Bloomberg Technology’s Aki Ito and Olivia Zaleski speak to both tech workers directly affected by this ban as well as company executives who fear the order will hurt their businesses. More restrictions could be on the horizon, and Aki and Olivia discuss what those might mean for the industry.

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Speaker 1 (00:00):
Don't let your legacy i T systems cost you money, innovation,
and a place at the digital table of the future.
You can change your systems and the economics of it
with software from red hat. See how at red hat
dot com. On Friday January, on his eighth day in office,

(00:21):
President Donald Trump signed an executive order at the Pentagon.
The content of the action was rumored for days, but
no one quite knew what the order was going to
mean on a practical level. Secondly, I'm establishing new vetting
measures to keep radical Islamic terrorists out of the United

(00:42):
States of America. We don't want them here. We want
to ensure that we are not admitting into our country.
The very threats are soldiers are fighting overseas. We only
want to admit those into it. In l A. Hussein Kasai,
the c EO and co founder of a mid sized
technology startup called on Fight Oh, was at his family's

(01:06):
home when the news broke. He didn't really think much
of it at first. There's been a few executive orders
that actually don't mean anything in terms of legally being enforceable.
They don't mean much. So my first reaction was this
is another one, and that this this, it just seems
I'm not a lawyer, but it seems a pretty common
sense that it just seems mostly like I can't see
how legally this could be enforced. Um, so you got

(01:28):
real for me when when I saw the protests at
that airports, including JFK say and the reports that that
didn't individuals have now been either detained or asked to
go back. And after I had just calls from the

(01:48):
messages from lawyers or others offering support and saying don't
sign this, and so on if if you're traveling. Trump's
order halted citizens of seven majority Muslim countries from coming
into the US that's Syria, Iran, Iraq, Libya, Somalia, Sudan,
and Yemen, and included people with valid US work visas

(02:10):
and initially Green cards too. Hussein doesn't simply disagree with
the band. It affects him and his family directly. His
father is Iranian. Hussein himself spent ten years of his
childhood in Iran, and he's a British Iranian dual citizen.
Hussein is also a Green card holder, which means he's
a legal resident, but he's nervous that because of his

(02:32):
Iranian citizenship. His status here in the US might not
be as secure as he wants thought, and that means
it's going to get a lot harder for him to
run his business. A major part of the reasons why
myself and others moved to places like the US or
Europe is is because it's different. Because you know, there's
the rule of law, there's justice, as freedom is democracy

(02:54):
and all these things. Um So this is particularly surprising
for us because we know what's what the other way
is like, and hence it's not normal. It's dangerous. This
is the starting points of very dangerous road to go down.

(03:16):
Hi am Aki Ito, and I'm Olivia Zeleski, and this
week on Decrypted, we're discussing Trump's executive order and what
it means for the tech industry across the country. Over
the last week and a half, we've been hearing stories
like Hussain's. We've heard them especially loud and clear here
within the tech community, which relies heavily on the brains
and the labor of skilled foreign immigrants. For weeks since

(03:40):
Trump won the election, tech executives have been trying to
make nice with him. But after this executive order, Silicon
Valley is in full revolt. We'll see what this could
mean for the tech industry going forward, as we hear
reports of even broader restrictions on foreign workers. Over the

(04:01):
last weekend a half, the details have been changing quite
a bit, so we're going to recap what we know
for now. For one, anyone who was born in or
as a citizen of the seven Muslim majority countries has
been stopped from entering the US for ninety days. It
means that people who are in the US when the
order was issued cannot travel internationally, otherwise they might not

(04:23):
be able to come back in now. The order never
applied to U s citizens, And as for Green card holders,
they were getting detained at first, but then Homeland Security
Secretary John Kelly came out and said Green card holders
will be allowed in unless there's reason to believe they
pose a threat to national security. And the situation has
been changing fast. There's been a storm of legal challenges,

(04:47):
and on Friday, February third, a federal judge ordered a
nationwide temporary block to the travel ban. As a result,
over this past weekend, border officials stopped enforcing the execut
of order, and the State Department has reversed its cancelation
of what's said to be tens of thousands of visas
for people from these seven countries. But Trump isn't backing down.

(05:12):
Immediately after the federal judge ordered the suspension of the ban,
the administration asked a federal appeals court to reinstate it,
and the President has put out a couple of tweets.
One said, quote the opinion of this so called judge,
which essentially takes law enforcement away from our country, is
ridiculous and will be overturned. Another tweet from Trump said,

(05:34):
when a country is no longer able to say who
can and who cannot come in and out, especially for
reasons of safety and security, big trouble. As of taping
this on Monday, February six, we're still waiting to hear
a final decision from the appeals court. Whichever side loses
could even bring this to the Supreme Court. This all

(05:57):
means that Hussein, the CEO of the startup on Fido,
is in limbo. On Fido is based in the UK,
but Hussain spends most of his time here in the US,
which has become his company's largest and fastest growing market.
He spends about three to four weeks here in the
US for every week he spends in the UK, and

(06:18):
perhaps ironically in this contacts and Fido verifies people's identities
and runs background checks. The entire company is now just
shy of a hundred and fifty people, with eleven in
the rapidly growing US office, and and any company growing
tech in particular, co founders play a pretty important role,
anything from from enterprise client sales, to recruitment, to infrastructure

(06:43):
work to just whiteboard sessions with the team on the
product side and on the talent side, in the whole
range of areas. It is why it's important to be
mobile now. Hussain says he's fortunate that even if he's
forced to leave his life in California, he could still
return to the UK. A he says it startups US
business has grown enough that it could still run without

(07:05):
him being physically there. Eighteen months ago, we may most
definitely what have had to think of alternative plans We
are now just because we're constantly looking to recruit and
constantly looking to grow um. But we're probably at the
stage where it's it's if I spend less time, it's
not going to be as damaging as it would have
been eighteen months ago, but that's not true for all
startup founders. The night before Trump signed the executive order,

(07:27):
another Iranian entrepreneur, Sasha Islami, was boarding a flight to Argentina.
He was planning to spend two months they're recruiting for
his fledgling photo sharing app called ever Snap. He spoke
to our reporter Shelley Haggen about it. I arrived to
Bueno Sirius eleven PM the day after Buenasirius time. All

(07:48):
of a sudden, it starts getting messages from one of
my friends in the US and he's telling me about
what Trump has done. And at first I thought, Okay,
well this is really bad, but it shouldn't affect me
because I'm a Green card holder, UM permanent resident. Then
if one hour later he sent me an article about

(08:08):
how it's been confirmed that also permanent residents are also banned.
So um, then all of a sudden, things, you know,
it gets pretty scary because I have all my all
my business in the US. I have a gigantic house
in San Jose that I have all my stuff there.
You know, I I go to meetings all the time,

(08:29):
right with business partners, with investors, with founders when I'm
in the US, and it's something that my business relies
on me being able to be there and most of
the time. For now, Sasha's hope is that by the
time he's done with this two months recruiting in Argentina,
any ambiguity will be resolved, at least for Green card

(08:51):
holders like him. Nobody knows how it's going to play
out within the next couple of weeks. Right um, every
day we're getting some sort of new information, right and
it isn't even the administration himself. They're not clear on
what it entails. So my plan is to just, you know,
wait a week or two, see how everything unfolds, right,

(09:14):
and then take a take an education educated decision after that.
And then there's another couple we spoke with, the husbands
and engineer at one of the biggest tech companies here
in Silicon Valley, and he's been in the US for
nine years. His wife is a medical researcher at a
large university in California and she's been here for seventeen years.

(09:36):
They're both from Iran, and they've asked us not to
use their names or their employers names because unlike Hussain
and Sasha, they don't have the security of a U
screen card. Their applications pending, and now they're worried it's
never going to come through. I mean, the unstability, the unpredictability,
is just unbelievable. We had plans, we had I mean,

(10:00):
I'm a kind of a math type, so I would
just like look at the investments and figure out what's
the right amounts to do in the four one K
and what's the right balance of the funds and all
that stuff, figuring out based on what when we want
to retire, based on then we want to buy a house,
and you start planning for thirty or forty years in
the future in some way, right, And those plans were

(10:23):
here in the United yes, And then suddenly now we're
thinking about plans for tomorrow, next week, next month, trying
to predict what could happen if that happens. What can
I do? How can I move fast? How can I
be very dynamic to handle various different scenarios. It becomes
from a stable life with the future. In one day

(10:45):
or two it changes into a survival mode life in
a way that I know nothing about my future. I
don't know if I if I'm gonna be able to
legally work or stay at my home. I don't know
where in the world and I can go because as
I can't go back to your own for various reasons,
including that time, I'm not a Muslim and I'm atheist.

(11:07):
What would happen if you went backed her in and
the so To be honest, I'm not sure. They may
not care that much, or they may care a lot.
A lot of it is kind of arbitrary, which I'm
kind of worrying may happen here too. Arbitrary stuff. If
they don't like you for some reason, they're gonna dig
up everything on you and then attach that level to

(11:30):
you and then take your life away in various ways.
Coming up, we take a look at how the tech
industry has reacted to the executive order that's right after
these words from our sponsor. Inside the most successful organizations,

(11:53):
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(12:16):
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dot com. So far, we've heard from Hussein, Sasha and

(12:36):
the couple who were not naming today. They're all directly
affected by the travel ban, and I think you can
really hear the uncertainty and the devastation in each of
their voices. You Know, what's been really striking to me
is how swift the response was from the tech community,
just how vociferous it was, at least at the beginning.
We didn't hear a whole lot from other industries. And

(12:59):
this was after months of careful steps that the tech
industry was taking to reconcile the Trump Tesla CEO Elon
Musk and Uber CEO Travis Kalenik both agreed to join
the President's Advisory Board and a host of tech leaders
they went to Trump Tower to meet the then president
elect during the transition. But after the travel band, top
tech leaders like Facebook CEO Mark Zuckerberg has spoken out.

(13:24):
He wrote a very personal post about his wife's parents
that they were refugees from Vietnam and China. It was
on the very day that the order was signed. Google
CEO Sundar Pichai sent out an internal memo talking about
the more than one hundred employees who have been affected
by the actions, and he said that it's painful to
see the personal cost of Trump's actions. And Uber's Kalenik,

(13:48):
who joined Trump's Advisory Council, he announced on Thursday that
he was stepping down from the committee. In Seattle, Amazon
and Expedia file declarations that support Washington States pawsuit against
the executive order. Do you telling how the travel bands
hurt their businesses? This was the very lawsuit that led
to the nationwide temporary suspension of the travel restrictions. And

(14:11):
in New York, an industry group called Tech NYC came
out with a public letter to Trump opposing the executive order,
and it was signed by some of the biggest names
in the New York tech scene. I spoke to their
executive director, Julie Samuels. Many of the leaders in our
tech community here in New York City felt that they

(14:32):
wanted to do something, and you know, in these instances,
it's kind of hard to know what to do. We're
here in New York, We're not in d C. These
executive orders had been signed already, so we took the
opportunity to put together a letter once you can see
um at on our website, which is tech NYC dot org.
Within twelve hours, we had over four hundred signatures um all.

(14:54):
This took place on a Sunday afternoon, which is also notable.
Um people were coming out of the woodwork. So this
gets us to the question of why immigration. Why was
it this the travel restrictions that provoked such an outcry

(15:17):
from the tech industry. Well, for one, entrepreneurs are at
the core of the tech industry. These tiny startups are
often the ones coming out with the crazy next new
things that end up taking off. Between two thousand seven
and nearly of new businesses in California were started by
people born outside the US. Our reporter Shelley discussed this

(15:40):
in more details with David Mendel's, the CEO of bright Cove.
There're a midsize online video software company in Boston. You know,
I think you have to keep in mind that most
of the tech community is in places like Massachusetts where
we are uh Silicon Valley in California, New Yorkity, the Washington,

(16:01):
d C. Metropolitan area, and these are people that live
in incredibly diverse communities. UM for us, the idea of
working with a Muslim individual of Iranian descent is not
an abstract idea. That's something I do every day. I
think everybody here knows people who are being targeted or

(16:22):
feel like they're being targeted by this, and so I
think you really have no choice if you want to
be true to the people around you but to feel
strongly about this. So that's one point that these are
your friends and your coworkers and your neighbors. A related
point is that given how difficult it is for companies
to find good coders, tech companies don't want to lose

(16:44):
any of them. Google alone said there are over a
hundred employees affected by the band. Yeah, I actually didn't
know this until we started reporting for this podcast, but
there's a big community of Iranian engineers here in the
valley and industry executives. You're also worried that it's going
to hurt their ability to do business around the world.
Here's David again. Well, I think there's all kinds of

(17:07):
things that could happen in the future, and there's all
kinds of spin on effects. So how's the rest of
the world going to react to America that is closing
its borders, not just with immigration issues and refugee issues,
but also all of the talk about tariffs. Um, that's
a problem for me. Our business is approximately outside the

(17:28):
United States. For an exporter, it is not in my
interest for us to put up walls metaphorical ones in
this case that make it harder for people to do
business with countries and the United companies in the United States,
because I think what we'll see its retaliation. You know,
it's hard to predict where things are going to go
from here. But our colleagues in Asia, Peter Eelstrom and

(17:51):
Serretha Ry, obtain a draft of a new executive order
that the Trump administration is considering, and that draft proposes
to get harder for all foreigners to get a work
visa here. The draft, which we should say has not
come into effect for now, it's just a draft that's
being passed around, says the changes would prioritize and protect quote,

(18:15):
American workers are forgotten working people and the jobs they hold.
And we'll note here that over the years there have
been some reports that some companies maybe abusing the H
one B work visa program that they hire foreign workers
so that they can pay them lower wages than they
would otherwise pay their American workers. But tech and Yes

(18:35):
Julie says that when smart, skilled foreigners come to work
in the US, Americans end up benefiting too. It is
incredibly important that we have open immigration policies that attract
the best, the brightest from other countries here to build
businesses here, to create jobs here. That's incredibly real. The
list of big companies that were founded are co founded

(18:56):
by an immigrant um is an incredible list. It includes
Tesla and includes Facebook. It includes some really big companies.
Research shows that net new job growth in the United
States comes from new firms. So while of course the
majority of startups fail, the ones that grow are the
ones that create all the new jobs. So we want

(19:17):
people here growing those companies. Oh, Google, I left Google
off the list. Think about how many new jobs Google
has created in the last decade. Hussaying, the CEO of
a Fido who he heard from earlier, is another example
of this. He's created eleven jobs here in the US
through his startup, and he's looking to hire more people,

(19:37):
and many of the tech workers affected by this measure
don't think they'll be replaced by American workers. The Iranian engineer,
whose wife is a medical researcher, Well, he said his
employer has already offered to move them to another international
office if that becomes necessary. The thing is that it's
not like a job that if if I leave, it's

(19:57):
it's sitting there and somebody get it. I have the
job because of the particular skill sets that I have.
If I move, they move with me. It's it's not
that there's a hole and there's an opening that if
I'm not there, somebody else can feel it. It's it's
not that we are taking somebody's jobs. It's you have
those jobs a lot of people like us. The job
kind of gets created for the person you want, this

(20:20):
kind of person, and you figure out how to use
them to push forward your goals and your company or
your side, or your university or something like that. So,
as you said, it's not like the there's a there's
a whole whole ful field on Fidos who say also
told his two Randian employees that will move them to

(20:40):
the UK if it comes to that. Yeah, it's not
like he's going to fire them and hire two Americans
in their place. Well, for now, we'll leave you on
this note. Since the executive order was officially signed on Friday,
have you both discussed potentially leaving the United States, maybe
going to Canada, maybe going to Europe. UM. I think

(21:04):
we are thinking about um, looking at every everywhere that
we can potentially go. This was the first thing that
came to our mind that what if this continues? This
is not just the one time. Yeah, there is no
one in this world who can ever decide where they

(21:25):
where they want to be born. No one has ever
been able to decide that you're born somewhere. And the
hope was that there is this place on Earth, UM,
a particular country on then a North American continent that

(21:46):
didn't discriminate based on where you were born. Right to us,
I think America is more than a just country with
certain borders. It's an idea and I felt that that
idea is shattering that we've been searching for equality right

(22:17):
in I. I grew up in a kind of a
lower middle class family in Iran. I grew up my
family was not connected in any ways to the power powers.
I was always a second class citizen back home in

(22:38):
so many ways, by not believing, by not being connected,
by not being rich. And this was a country where
we thought those things wouldn't matter. We thought, and and
beside everywhere, weside in the movies, beside in the media,
beside in the laws, reside in the corn institution, we

(23:00):
saw it in the movements. I mean the civil rights movement,
the feminism movement. I mean I said, Okay, this is
the country where people are fought for those values and
they've achieved them, and we can go there and have
it and be there with these amazing people. That's it

(23:42):
for this week's Decrypted. Thanks for listening. Well tell us
what you thought of this episode. Send a voice message
to our producer Pia at p g A d k
A r I at Bloomberg dot net, or write to
me on Twitter. I'm at Olivia's Leski and I'm at
Akio seven. You can subscribe to Decrypt it on iTunes
or wherever you get your podcast, and leave us a

(24:04):
rating in a review. This helps us make our show
better and it also gets our podcast in front of
more listeners. This episode was produced by Pierre get Cary
Magnus Hendrickson and Liz Smith. Shelley Hagen and Sarah Friar
helped with additional reporting. We'd like to say a special
thanks to Shoubert Shawberry, who runs the Persian Tech Entrepreneurs Network.

(24:24):
He connected us with a variety of startups for today's show.
Alec McCabe is head of Bloomberg Podcasts. We'll see you
next week. Don't let your legacy I T systems cost
you money, innovation, and a place at the digital table

(24:47):
of the future. You can change your systems and the
economics of it with software from red Hat. See how
at red hat dot com.
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