Microsoft Chairman Bill Gates called on the U.S. Congress to raise the cap on skilled-worker visas, saying the county's economic future was at stake.

Gates, testifying before the Senate Health, Education, Labor and Pensions Committee, said he'd prefer that "unlimited" numbers of highly skilled foreign workers be allowed into the U.S., although he acknowledged that might not be politically feasible. Right now, the controversial H-1B program, which tech vendors and other companies use to hire foreign workers, has an annual cap of 65,000 people a year, and the cap is typically reached in the first couple of months the applications are available.

"We have to welcome the great minds of this world, not drive them out of this country," Gates said, repeating his earlier calls for a higher H-1B cap. "These employees are vital to American competitiveness. We should encourage them to become permanent U.S. residents; they provide the nation economic growth, alongside America's native-born talent."

[Blog:  More visas for Windows rivals?]

Several U.S. tech companies have recently said they have hundreds of unfilled jobs because they can't find qualified workers.

Gates also repeated two other themes he said are necessary for the U.S. to continue to compete in a global economy: He called on Congress to improve the U.S. education system and increase government spending on research and development. Without those three changes, the U.S. is at risk of losing its economic power and high standard of living, he said.

"When I reflect on the state of American competitiveness today, my immediate feeling of pride is mixed with great anxiety," he said. "The challenges confronting America's global competitiveness and technological leadership are among the greatest we have faced on our lifetime."

This generation of U.S. residents is too often living off the innovations of the past, he said. He called for "courageous" leadership to fix failing U.S. high schools, find more money for research, and welcome more immigrants.

Few senators challenged Gates' position on foreign-worker visas, instead asking questions about Gates' ideas on improving education, including the Bill and Melinda Gates Foundation's funding of experimental high-school programs.

U.S.-based tech worker groups such as the Institute of Electrical and Electronics Engineers-USA (IEEE-USA) have opposed a higher H-1B cap, arguing that companies use the program to hire foreign workers for less money than unemployed U.S. workers would receive.

Senator Sherrod Brown, an Ohio Democrat, said he heard different stories from industries and workers during forums on the economy in his state last month. "Time and time again, local businesses told me that they just could not find the engineers or the computer scientists they needed to run their businesses," he said. "At the same time, skilled workers in my state are watching their jobs move overseas, not because foreign workers are more qualified, but because U.S. companies can get away with paying poverty wages to workers in other countries."

Senator Bernie Sanders, a Vermont independent who often votes with Democrats, also questioned the effect of outsourcing. U.S. companies can hire overseas engineers at a "fraction of the cost" of U.S. engineers, he said.

The free trade agreements that allow easy outsourcing benefits the U.S., Gates answered. The U.S. tech industry is able to grow by being able to sell products all over the world, he said.

"The demand worldwide for highly qualified engineers is going to guarantee them all jobs wherever they are located," Gates said. "The IT industry, I guarantee you, will be in the United States as long as we can get these people to come to the United States."

Senator Judd Gregg, a New Hampshire Republican, said he agreed that Congress needed to raise the H-1B cap. He asked if an annual cap of 300,000 would be appropriate.

"It'd be a fantastic improvement," Gate said. "My basic view is we should welcome as many of these people as we can get."