US tariff hikes and H-1B visa fee hike are a lesson for investors. Here's why
US tariffs have been announced, delayed, modified and sometimes reversed in recent months. Companies are expected to make long-term investment decisions without knowing what the trade rules will look like next quarter, let alone next year.
Ronald Reagan had a joke about life in the Soviet Union, where chronic shortages meant citizens faced absurdly long waits for basic goods. In this story, a man finally saves enough money to buy a car. He navigates the bureaucracy, pays the money upfront, and is told by the clerk to return in exactly 10 years to collect his vehicle.
"Should I come in the morning or afternoon?" the man asks.
The clerk looks puzzled. "Ten years from now – what possible difference could it make?"
“Well," the man replies, “the plumber is scheduled to come that morning".
The joke captures something essential about life under unpredictable systems. Even when delays stretch across decades, people still need to plan around them. They still need to coordinate their lives, make arrangements, and think ahead. The 10-year wait isn't the real problem — it's the inability to plan rationally around it that corrodes everything else.
This Soviet-era joke feels remarkably relevant today as we watch American policy create similar planning paralysis across the globe. The recent announcement that H-1 B visa applications will now cost employers $100,000 — a roughly 2,000% increase from the previous fee — is just the latest example of how sudden policy shifts are forcing businesses and individuals into situations that make planning impossible.
Uncertainty is poison
Consider the position of an Indian technology professional currently working abroad. Should they rush back to America before the new rules take effect? Should they delay their return for a few years? What about their spouse's career, their children's education, or their parents' healthcare needs? These aren't abstract policy questions—they're deeply personal decisions that affect millions of families who now find themselves trapped between unpredictable rules and unchangeable life circumstances.
The same planning paralysis affects businesses trying to navigate America's increasingly erratic trade policy. In recent months, tariffs have been announced, then delayed, modified, and sometimes reversed. Companies are expected to make long-term investment decisions — such as building factories, signing supplier contracts, and hiring employees — without knowing what the trade rules will look like in the next quarter, let alone the next year. Singapore's trade minister joked at a public forum that US tariffs changed three times over the period it takes a container ship to travel from Singapore to San Francisco.
When a company is uncertain about whether it will face 10% or 50% tariffs, it cannot rationally decide where to build its next facility or which suppliers to hire. This is more damaging than the high tariff itself.
Once bitten, twice shy
For Indian investors watching these developments, the lessons extend far beyond US immigration and trade policy. The same principle applies to any environment where the rules change unpredictably.
The most insidious aspect of such unpredictability is how it changes behaviour long after specific policies are reversed. Businesses that face sudden rule changes begin building much wider safety margins into their planning. They delay investments, diversify suppliers, and generally become more conservative. Individuals facing visa uncertainty don't just delay their travel plans — they reconsider career paths, educational investments, and family decisions that might have seemed straightforward under predictable rules.
Companies that spent years navigating unpredictable trade rules don't immediately resume aggressive expansion when clarity returns. Families that experienced visa uncertainty don't quickly forget the stress of not knowing whether they could return home or bring relatives to visit. The psychological impact of unpredictability creates its own economic drag, extending far beyond the direct costs of any particular policy.
When people can't plan rationally, they plan conservatively. And when everyone plans conservatively together, investors, and indeed entire economies, begin moving like Soviet car factories — slowly, cautiously, and far less efficiently than their potential would suggest. Equity investors shift to fixed income and companies sit on cash rather than expand aggressively, creating a vicious circle. All Indians above a certain age have experienced this first-hand.
Dhirendra Kumar is founder and chief executive officer of Value Research, an independent investment advisory firm.
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