> It really doesn't. You end up with a whole segment of engineers that effectively become invisible to the local tech scene, because they are way above the local rates.

If remote salaries will be significantly higher than local ones many governments will be tempted to raise/introduce taxes on foreign income (and in authoritarian ones it is easy to implement). Since cross-border payments in most countries are closely monitored it would be not hard to enforce. Which in turn would make local jobs more attractive in comparison.