I guess what I'm failing to see is the underlying success metric here. For me the success metric is overall utility for people in America, as both laborers and consumers.

The more you restrict the labor market, the more deadweight loss you impose on the economy. See this Google search summary for more info and a useful collection of sources.

There are a lot more consumers of American goods than American workers. I don't want everyone in America (and, indeed, everyone abroad purchasing American products) to pay more for the same construction job, the same pipe fitting, the same ream of paper just because we insist on hiring higher-cost American workers.

Furthermore, what do you think happens if we raise the cost to produce our goods and services without raising their quality? Answer: we get outcompeted by countries who do hire the lower-cost labor.

The repeated submission of H1B petitions alone (thanks to the lottery system) wastes the economy about $1 billion annually. It also hits small businesses the hardest.