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Durbin and Schumer maintain that these visa restrictions will force American companies to invest more in American talent and raise American wages. But good programmers already command up to $200,000 in wages, notes Wadhwa. Raising these salaries further will only prompt American companies to offshore their whole operations.
Microsoft supports these restrictions for the simple reason that in a world of finite visas, fewer visas for Indian companies means more for itself. But IBM and Accenture have even more insidious motives.
Both companies have been expanding their IT operations in India and are directly competing with Indian companies for American “offshore” business. IBM now generates about a third of its revenues in India where it employs over 100,000 people. The visa restrictions are simply an effort to cripple their foreign competitors and capture their offshore market share, something that won’t save a single American job.
None other than Ronil Hira, a professor at the Rochester Institute of Technology, whose work was instrumental in triggering the jihad against alleged visa abuse, pointed this out during his Congressional testimony. Because IBM and Accenture have a large American workforce, they will be able to hire even more H-1Bs than the Indian companies without running afoul of the new visa regime.
“Therefore, we will simply see the outsourcing shift from a company like Cognizant, which will face restrictions, to an Accenture, which will not,” he noted.
The Indian government is working behind the scenes to kill these discriminatory measures. Its effort now will be to replace the Senate provisions with a much cleaner H-1B bill proposed by Republican Congressman Darrell Issa that has already passed House Judiciary Committee.
If this effort fails, backlash would be inevitable. Infosys, TCS and Wipro are a pillar of India’s $100 billion IT industry and a source of national pride. Watching them be mistreated after they have worked hard and played by the rules is already igniting calls for retaliation, including giving Indian companies preferential access to government contracts over IBM and other American companies.
How ironic it would be if immigration reform that was meant to knock down America’s existing walls to foreign talent ends up erecting new walls against American business abroad. Protectionism has a way of backfiring. Both Durbin and IBM should bear that in mind.
This piece was originally published in Business Insider.
*Update: The original wording of this sentence read:
Companies like IBM and Accenture have managed to rewrite the H-1B visa program so as to allow themselves to add foreign workers to their U.S. payrolls while forcing Indian companies in the U.S. to subtract Indian workers from theirs.
It was modified after Accenture informed us that it "has not advocated for any changes to U.S. immigration law intended to penalize another company."