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Why H-1B Visas are Bad for America By: Robert Locke
FrontPageMagazine.com | Wednesday, January 24, 2001


AMERICA'S GENEROUS IMMIGRATION LAWS are increasingly being corrupted and taken advantage of by self-aware economic interests. Take, for example, the H1-B visa program for technical workers, which was recently expanded to 200,000 people per year by the Clinton administration. H1-B allows corporations to bring in cheap foreign technical labor in the computer industry and elsewhere. This is shrinking opportunities for American citizens, driving down their wages, and stunting the production of homegrown talent.

Industry likes to tell the public that they need to bring in foreign workers because of a so-called "labor shortage." But the very concept of a labor shortage is a sophistry that has no place in free-market economics. Economics teaches that in a free market there are never shortages of anything, only things whose price, as set by supply and demand, is higher than some person wishes to pay. There is not a technical job in America that could not be filled with an American citizen if the employer were willing to pay the right price. The fact that the company in question "cannot fill" the position is merely a function of their desire to set an arbitrary price that they feel like paying. This is not the way of the market, and frankly it is a form of corporate decadence for them to go running to the government for a subsidy in the form of cheap foreign workers.

The emerging pattern in American society has a sinister resemblance to the decadent sheikdoms of the Gulf, which can't pump their own oil without massive foreign labor: Americans handle the financial and marketing side of things while we let foreigners do the engineering and the hard stuff. The national-security implications alone are chilling.

Furthermore, because we have this supply of foreign labor, we let our own technical education system slide, and we never liked math that much in the first place. Frankly, until American industry is served notice that it will have to supply its future technical needs from our own people, it has absolutely no incentive to care. Former Labor Secretary Robert Reich stated "The H-1b program "has become a major means of circumventing the costs of paying skilled American workers of the costs of training them." (Those who blanche politically at taking the word of a liberal like Reich should in fact rejoice at the sight of the opposition being hoisted on its own petard by one of its very few intellectually consistent members.)

H1-B helps promote age and other forms of discrimination by giving companies a ready supply of foreigners who don't have any uppity American ideas about their rights and who can be silenced by threatening to send them back where they came from. Because even companies that don't employ H1-B workers can threaten to do so, H1-B has a chilling effect on industry as a whole.

Though the H-1b has been sold as providing companies access to the "world's best and brightest", reality differs from the sales pitch. The law states the alien must have "a bachelors degree or equivalent". Hardly indicative of the world's best and brightest. Experience shows that the people imported are, in general terms, no better or no worse than domestic workers. Nobody objects to bringing in Nobel-calibre scientists and the like, but this is a tiny number of people, not 200,000 per year.

There are entire companies in America now where native-born Americans are not welcome. Some of them are even growing fat on defense contracts. H-1b visa holders are often "benched" when imported by a contract engineering house or "body shop". They will be brought in and benched until the contract firm has a job opening they can fill. Often they are not paid until they actually go to work at a client firm of the contract house. They may be provided a place to stay, and a small amount of spending money until they get on the payroll.

The final idiocy of the recent raising of the H1-B quota to 200,000 per year is that it was done just as we are almost certainly overdue for a recession. People tend to assume that all technology workers are rich dot-com entrepreneurs; in fact, 95% of them are ordinary middle-class Americans.

The Labor Department has nominal regulations on the books to protect American citizens, but these have so many loopholes as to be ineffective. For example, although Labor Dept. regulations require companies to pay at least 95% of the prevailing wage, companies are free to use biased data in establishing what this wage is. The survey data is always suspect because it is provided by the very companies who will benefit from the results. They spin the data by grouping employees into inappropriate categories, by selective reporting, and by outright dishonesty. Companies who do not use foreign labor are reluctant to answer the survey as it entails some cost and time which could be spent on more productive corporate endeavors. Furthermore, because H1-B workers depress wages, their prevailing wage tends to become a self-fulfilling prophecy. No one ever checks the results of the survey.

Industry likes to claim that it needs H1-B workers "to be competitive in the global economy." However, they can't get even Clinton's Labor Department, which has overseen this massive giveaway program, to buy their line. Department of Labor Office of Inspector General Final Report. Report Number: 06-96-002-03-321 Titled "The Department of Labor's Foreign Labor Certification Programs: The System Is Broken and Needs To Be Fixed" dated 1/24/97, states "In our opinion, not all types of jobs being filled by H-1B aliens necessarily represent jobs that would enhance U.S. employers' abilities to compete in a global economy."

Congress has repeatedly agreed, year by year, to expand the number of H1-B visas, always in exchange for provisions designed to protect American citizens. But this congressional intent is being frustrated.

Charles C. Masten, Inspector General, H-1B Labor Condition Application (LCA) program made the following comments. "Audit findings in a recently issued OIG report found that both programs fail to adequately protect American jobs or wages, as intended by Congress.  The audit discovered that the Department's role amounts to little more than a paper shuffle for the PLC program and a "rubber stamping" for LCA program applications….The OIG also found that the labor market test, which is designed to ensure that there are no qualified U.S. workers available to fill the positions for which the application has been filed, is perfunctory at best… Despite annual expenditures of approximately $50 million on DOL's foreign labor certification programs, the OIG found that DOL's role in the PLC and LCA programs did little to add value to the process of protecting U.S. workers' jobs and wages."

America's high-paying technical jobs are one of its most precious assets and they should not be squandered on foreigners.  America has been the most competitive nation on earth for years without importing mass foreign technical labor.  We are sending a message to our young people not to take technical careers, where they will be forced to compete against cheap foreigners, and making ourselves dependent on people with no intrinsic loyalty to us.  The entire H1-B program should be abolished, and the few authentic geniuses out there should be brought in under other, existing programs."

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