Current version of H1B had become a big basket to hold both, and abused too for just finding cheaper labor. It may be time to segment these out.
Also, given that US has ~400 million local citizens, there should be less need for either.
Now the question is whether the US wants another visa category for finding cheap labor. I am not sure that is either needed or desired (by voters). Maybe with the exception of agriculture
https://www.abet.org/accreditation/find-programs
Thats literally the point of getting a degree, to determine that all grads meet a set of minimum qualifications
O-1 is for exceptional talent ("extraordinary ability"). Bring exceptional talent, eliminate the H-1B visa. It's that simple.
When you actually want to identify talent, it works the same way everywhere. You find other experts in the field you can trust and ask them to use their subjective judgment. Governments don't want to do that unless it's absolutely critical, as it goes against the prevailing theory of how government bureaucracy is supposed to work. Even if the government is willing to give outside experts the power to make the decisions, the experts probably don't want to accept the liability that comes with it. Which leaves the final decisions to government officials who rarely have the expertise to evaluate the claims on their own.
Our friendly neighborhood Ski resort oligarchies leverage the J-1 Visa program to bring in international students to work at the resorts over paying more to hire local workers for example. They also leverage the company store model by putting them in dorms and charging them accordingly for housing.