This is a structural kill shot disguised as moderation – not a walk-back.
Trump’s team knew if they slammed existing holders immediately, the courts, corporations, and universities would swarm them with injunctions and sob stories about disruption.
So they carved out the stock, left it untouched, but put a noose around the flow. That’s the actual pipeline that kept Silicon Valley, outsourcing shops, and Indian IT mills running. Kill the flow, the stock ages out, and the model dies in slow motion.
Think of it like choking off oxygen. The body (existing H-1Bs) keeps moving for a while, but without new supply, the system collapses from within.
The real mask-off implication:
•For American labor: This is the first time in decades the cost arbitrage model has been structurally dismantled. Over the next 2–3 years, wages at the bottom tier of STEM jobs will rise, not because of “free markets,” but because the cheap labor conveyor belt is being dismantled.
•For Indian IT giants: Infosys, Wipro, TCS, Cognizant – their stock reactions already show it. Their business model is fundamentally impaired. They can’t win contracts undercutting wages without cheap visa inflows.
•For universities: The H-1B system was a backdoor subsidy to pump STEM enrollments. If the exit pipeline is shut down, the entire higher-ed incentive structure breaks. That’s a slow bleed, but it’s lethal.
•For markets: The knee-jerk calm (“oh, existing holders are safe”) is a misread. This isn’t about the next quarter. It’s about rewiring the labor supply chain. That’s far more radical.
Trump just set a fuse that detonates the 30-year experiment of outsourcing America’s brain. It won’t look explosive at first, it’ll look like a slow policy tweak. But in 12–24 months, it creates a reflexive cascade: higher wages, corporate reshoring pressure, offshoring taxes, universities losing demand, and foreign IT stocks structurally repriced down.
American Buddhist Net 