With an auction system like that, basically every small business will be out of the picture then.
The big companies that need highly skilled employees can afford to pay en masse.
Now if you are a US based small business and you found a dream employee in say Australia. Either this employee is so valuable that you would be willing to shell out something like 50-100k to bring him/her over, or what is more likely you become flexible and let him/her work remotely.
I do not foresee many small businesses who would actually need to bring a foreign employee in for a constant presence in US. Does a barbershop really need to bring a foreign born barber. If it does then that barber would probably qualify as an alien of extraordinary ability...
My views is biased as a European who programs for a medium sized US business and sees no need to visit US more than once every year.
A small business that's small because it's a niche can afford to have a dream employee work remotely. A small business that's small because it's not-yet-large in a fast-changing market will be slowed down dramatically by the timezone differences, and probably lose out to competitors that colocate all their people.
If your small company wants to employ someone then you have to be willing to pay as much as a big company will for the same employee. And that goes whether you're just paying salary or paying salary plus visa price.
The only disadvantage I can see to small companies is that a big company could afford to buy visas in bulk at the start of the year and figure out what to do with them later, while a small company wouldn't buy visas until it had a specific employee in mind. So I'd make the auction monthly, not annual.
Whereas a large company can make a better case for paying say $100K on a visa for a $200K/year job, this is much harder for a startup paying e.g. $100K+1% equity for said job. If I have only $1MM or so in funding as a startup I am limited to what I can pay and couldn't reasonably waste a year's worth of salary on a visa, whereas a $50,000MM revenue company might have more leeway. No?
I'm sure that was proposed as ridiculous, but you have to keep in mind that there's only a programming labor shortage in two, maybe three cities on the coasts.
For a national program like this lottery, every non-citizen the .gov lets thru will result in many social program costs not only for the one citizen who won't be employed and at a higher pay rate, plus all the downstream effects of lower salaries and less jobs for citizens leading to lower economic activity leading to lower tax revenue.
A $100K cost per immigrant is below the low side of what it costs .gov to take care of the local citizens.
What I'm claiming is the program is a stereotypical crony capitalist "socialize the losses and privatize the gains" scam. Screwing the program up or limiting it or making it very expensive to participate in is a net economic gain to the country. "Fixing" the program would be a net economic loss to the country. Furthermore the program is literally inhumane, a real wage for a human with real working conditions is X, but as a psuedo-slave psuedo-indentured servant you are less human than a real human so we'll only offer you 50% of X and treat you like dirt because thats highly profitable and helps rich guys get richer at the expense of everyone else. Its disgusting that the program exists on several levels.
Besides Canada has better medical system, better crime stats, arguably better recreational opportunities... I wouldn't necessarily describe being "stuck" in Canada as much of a punishment. Its not exactly like being trapped in Somalia.
I don't think F1/H1B visa holders are entitled to ANY social programs. They HAVE to pay medicare/social security, but they cannot avail any of the benefits.
Its fundamentally a zero sum game, actually its a declining sum game for anyone middle class or below. So a guy from Canada or India or whatever gets a job, that means the local who would have gotten it is unemployed, mom and kids on welfare, etc.
Also there's a local utility who advertises for a $60K CCIE as part of their H1B program and aside from the $100K+ local who now has to work at walmart or pull cable or something, there are secondary effects on the local marketplace such that the $60K H1B can't participate in the local economy from retail to home construction quite like the now unemployed formerly $100K local. So that's $40K/yr not going to walmart / real estate developers / whatever. True, every penny of that $40K goes to the execs bonuses, but they might not live in that area (or even in that country) and there is a declining economic effect as fewer people have money (A poor dude with his first $100 bill contributes toward more economic activity (velocity of money, etc) than a rich dude with his millionth $100 bill)