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President Trump's Executive Order Targeting Foreign Techies Will Hurt American Companies and Workers

Spurning talent is never a road to greatness.

Immigration authorities opened up the annual H-1B visa lottery for American companies that want to hire foreign tech professionals on April 3. And this week they announced that they received 199,000 petitions—or more than double the number allowed. Clearly, current law fails to meet the needs of American employers. But instead of relaxing this program as would befit a president who promised to remove the regulatory handcuffs onForeign TechieFoter.com American businesses, President Donald Trump has issued a "Buy American, Hire American" executive order that will pass new regulations making it even more difficult to recruit high-skilled foreign workers—never mind the overwhelming evidence that these workers help, not hurt, American jobs and wages.

The H-1B cap is reached every year because the annual 65,000 limit—0.04 percent of the U.S. labor force—was set in 1990. Since then, technological advances like the World Wide Web and smartphones have turbocharged the demand for high-skilled technical labor. "Mobile app developers" -- a highly prized job today—didn't even exist 15 years ago. However, when companies recruit for tech talent at U.S. universities, they find Americans, to be sure—but the vast majority consists of international students, who make up an astounding 77 percent of the full-time graduate students in electrical engineering and 71 percent in computer science.

An H-1B visa is often the only way for these students or high-skilled foreign nationals educated abroad to work legally in America. That means new restrictions on H-1B visas would likely block the only feasible means for any foreign-born computer specialists, engineers, doctors or scientists to work in the United States.

Despite this, several conservative bills in Congress are trying to squash even this meager program. A bill co-sponsored last year by Sen. Ted Cruz (R-TX) and now-Attorney General Jeff Sessions wanted to force employers to pay well above market rates for these tech professionals and also require international students from U.S. universities to work for 10 years outside the United States before they could work in America. Another bill co-sponsored by Sen. Charles Grassley (R-Iowa) would require companies to prove to labor authorities that they tried to recruit an American before hiring a foreign national, which will expose employers to massive legal liability for every such hire.

Meanwhile, the Trump administration's pledge to build a wall around excessive regulation has a giant hole in it when it comes to immigration, as his executive order directing federal agencies to implement new rules and policies discouraging the hiring of H-1Bs shows. Part of this will no doubt involve stepped up site visits by Department of Labor investigators to companies with H-1Bs in their employ. "The moves seemed designed to appease President Trump's supporters, who urged him to make good on campaign promises to eviscerate the H-1B program," reported the Washington Times.

To discredit the hiring of all high-skilled foreign nationals and set the stage for draconian legislative and regulatory measures, Congressional critics and anti-immigration activists have skillfully publicized stories alleging that companies lay off U.S. workers and replace them with H-1B visa holders. However, in these stories—and the same ones involving Disney or Southern California Edison have received repeated media attention, including recently on 60 Minutes—what is actually happening is that companies are focusing on their primary business line and contracting out functions considered either non-essential, underperforming or technologically out of date.

Everyone sympathizes with the U.S. workers at Disney and Southern California Edison who lost their jobs. The question is whether these personal misfortunes require changes in the law. After all, the U.S. Department of Labor reports that every year in America approximately 20 million people are laid off or discharged from their jobs for all kinds of reasons.

I interviewed nearly a dozen advisers who evaluate bids and help companies figure out whether to contract out work and they confirmed the following:

First, companies decide whether to outsource and, therefore, on the need to make layoffs, before a contract is put out for bids, meaning they would be unlikely to know details like whether or to what extent visa holders will service the new contract.

Second, experts in outsourcing say companies are replacing the employees with new systems and technology, often with an offshore element, not making one-for-one replacements. H-1B visa holders generally play a limited, specialized role, primarily in gathering information from existing employees to help the transition from the old to the new contract, according to Alex Kozlov of the management consulting firm Alsbridge. So, experts say, whatever the appearance, the laid off employees are not actually training their foreign replacements, as is often alleged.

Third, new technologies, such as cloud computing and automation, affect far more jobs than anything related to foreign nationals on skilled visas.

There is no evidence to support the central claim of H-1B critics that Disney, Southern California Edison or other companies decided to lay off workers because they found a "loophole" in U.S. immigration law.

Consider what happened at Southern California Edison: Its decision to outsource, as Computerworld pointed out, was preceded by a highly critical outside management report that the company commissioned following a tragic shooting of two managers in its IT department in 2011. The report revealed "dysfunction" in the department, prompting the company to outsource its IT functions. Likewise, a source at Disney told me the 2014 decision simply continued Disney's long history of contracting out IT services, including a $1.3 billion deal with IBM and Affiliated Computer Services back in 2005, nine years earlier, that resulted in a reported 1,000 layoffs.

Setting aside those stories, none of the 40 economists polled in February 2017 by the University of Chicago's Booth School of Business believed that scaling back H-1B visas would lead to a material rise in jobs for U.S. workers. To the contrary, nearly all economists think the entry of high-skilled foreign nationals benefits the U.S. economy as a whole. And many believe that cutting back on H-1Bs would hurt American worker themselves.

Estimates by University of California-Davis' Giovanni Peri and Kevin Shih and Colgate University's Chad Sparber suggest that the presence of foreign STEM (Science, Technology, Engineering and Math) workers accounts for about 30 to 50 percent of the aggregate productivity growth in the United States between 1990 and 2010. Furthermore, they found a percentage point increase in the share of foreign STEM workers in a city's employment mix "increased the wage growth of native college-educated labor by about 7 to 8 percentage points."

Similarly, Madeline Zavodny, a professor of economics at Agnes Scott College, found that foreign and U.S. workers complement each other, with each additional 100 approved H-1B professionals being associated with an additional 183 jobs among U.S. natives. Likewise, a paper by economists William R. Kerr (Harvard Business School) and William F. Lincoln (University of Michigan) examined patenting and concluded, "Total invention increases with higher [H-1B] admission levels primarily through the direct contributions of immigrant inventors."

A few outlier and rather flawed studies have excited restrictionists, however. One published by John Bound and Nicolas Morales of the University of Michigan and Gaurav Khanna at UC-San Diego in February argues that native computer worker wages and jobs would have risen more during the 1990s if all H-1B visa holders had been blocked from the U.S. But what restrictionists fail to mention is that the study also concludes that the entry of H-1B visa holders makes essentially everyone else—namely, consumers and businesses—in America better off. More to the point, the authors concede there was actually great improvement for computer workers during this period. Employment of computer scientists and software developers rose by 161 percent from 1990 to 2000, and median real wages rose by 18 percent. In effect, their claim only is that wages and jobs among U.S. natives would have gone up a little more, not that either actually fell during the 1990s.

But even this modest impact is debatable. That's because the authors assumed that during the eight years they examined—1994 to 2001— the U.S. was "the only producer of IT" in the world, thereby eliminating the most obvious response companies would (and did) have: hiring outside the United States. That assumption strains credulity, since faced with current and past immigration restrictions, nearly all major and even mid-sized U.S. companies have set up or expanded offices and placed high-skilled people abroad. Policymakers who support restrictions on high-skilled immigration by assuming U.S. companies will not respond by placing even more work abroad are mistaken.

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  • Glide||

    *shrugs*

    Trump's position, and the related attitude toward H1Bs throughout the manufacturing-idolizing populace, is a necessary consequence of the national bipartisan assumption that merely existing in America gives any and all companies a moral obligation to contribute specifically to employment of Americans no matter whether than helps or hurts the economy.

    Until at least one side of the debate believes that providing goods and services is valuable in its own right without patriotic best practices required, hiring Indian and Chinese PhDs will continue to be panned no matter how much it boosts the economy.

  • JFree||

    when companies recruit for tech talent at U.S. universities, they find Americans, to be sure—but the vast majority consists of international students, who make up an astounding 77 percent of the full-time graduate students in electrical engineering and 71 percent in computer science.

    When people start asking the right questions here - why are American universities failing to educate Americans for well-paid jobs in America? why are entire industries that are so dependent on science/tech literacy doing absolutely NOTHING to interest Americans in being anything more than consumers of their product? why do these industries spend more on lobbying the govt to get 'capable' employees than they do on building a pipeline to get 'capable' employees? - then we might have a chance to move beyond the cronyism of H1-B

  • Old Monkey||

    My nephew a biomedical researcher was replaced over 5 years ago at UCSF Medical Research by an H1-B. For the last 5 years he has been gainfully employed in Japan, and is citizenship tracked to be a Japanese National. I knew a CNC machinist who was forced to train his "Tata H1-B" replacement who was neither the best or the brightest. When accused by his not so able replacement that he wasn't being properly taught, the CNC machinist replied: "I was instructed to train my replacement who I was told was a competent English speaking CNC machinist. You speak English, but you are neither a competent CNC programmer or a competent machinist"

  • Vrocks||

    I cannot agree with you more. Who is this guy that wrote the article? Does he work for a recruiting firm or something? This whole article is crap.

  • BambiB||

    The reality is that there is no minimum standard for H-1B applicants. Advocates talk about the "best and the brightest", but audits have shown than a very substantial number of applications are shot through with false information. Additionally, nothing about the program insures that the "best" will be selected. Visas are awarded by a LOTTERY system, so an internationally-renown, heavily published, Nobel Prize winner has the same odds of getting a visa under the program as a schlep who attended Diploma-Mill U.

    The REAL reason for companies clamoring for H-1Bs is because they are cheaper. And when one company uses them to get a cost advantage, others do as well. The BIGGEST users of H-1Bs are actually foreign companies which come to America, import cheap foreign labor and compete directly against American companies and display American workers. It is nothing less than importing outsourcing. NO OTHER COUNTRY IN THE WORLD PERMITS THIS.

    America awards 300,000 STEM degrees annually - which is more than enough to meet demand for the foreseeable future. The "labor shortage" claim is a LIE!

  • creech||

    I'd probably have a shit-eating grin too, after discovering that a significant number of American parents are wasting their money sending "Aaron" and "Taylor" to college. Worse, the morons that Watters finds all over the country are going to be running things someday.

  • Citizen X - #6||

    Don't respond to DanO. When it posts about "shameless attention-grabbers" it's really just jealous.

  • Citizen X - #6||

    Nationalism is a bitch.

  • ||

    It's worse than that. Nationalism is *stupid*.

    If we cut of the H1-B program, you would have to send 70% of CS and EE graduate students back to their home countries after they graduate with a masters or a PhD. We'd literally be exporting the most cutting edge research and technology.

    In the aftermath of World War II, the US brought Werner von Braun home from Germany (along with 1500 other german scientists and engineers), and he helped develop the US missile program, which gave us ICBMs and the Apollo space program.

    Where do you think America would be if someone said "No, we can't give that job to a German! Americans only!!" ?

    https://en.wikipedia.org/wiki/Wernher_von_Braun

  • Citizen X - #6||

    When you put it like that, it's sort of nationalism shooting itself in the foot, isn't it.

    I keep foolishly hoping that "all forms of collectivism are stupid" is a sentiment that could go without saying on a libertarian forum. Maybe, one day, it will be. [kicks pebble]

  • ||

    It really would be. The Chinese are probably giggling with joy that we're going to take their best and brightest, train them in the latest American computer science and engineering, and then send them back to China, where they can be employed by Chinese military technology programs.

    When I was growing up in Canada, people used to complain about the "brain drain". America was stealing all the smartest minds. Now Americans are worried that the smartest minds are going to steal their jobs.
    Poor, poor, Americans, so afraid that the foreigners are going to be smarter and more hard working than they are. What the fuck happened?

  • Citizen X - #6||

    The Canadian brains in question are William Shatner and Alex Trebek, yes?

  • Chip Your Pets||

    The Chinese are probably giggling with joy that we're going to take their best and brightest, train them in the latest American computer science and engineering, and then send them back to China, where they can be employed by Chinese military technology programs.

    If we're worried about training the next generation of PRC military engineers for them (and perhaps we should be) then we should be banning students from the PRC from our educational institutions in the first place.

  • Chip Your Pets||

    Poor, poor, Americans, so afraid that the foreigners are going to be smarter and more hard working than they are.

    No, foreigners are just cheaper and have primary loyalty to their employer rather than the community. And you can't possibly deny that.

  • Citizen X - #6||

    have primary loyalty to their employer rather than the community

    Even if true, so what?

  • ||

    foreigners are just cheaper and have primary loyalty to their employer rather than the community. And you can't possibly deny that.

    A ridiculous statement. Foreign brains are the same as American brains, and they respond to the same incentives and motivations.

    I guarentee you that most of those foreign employees are here because they want to immigrate, legally, and they will get a better job as soon as their green card is processed. There's no loyalty to the employer beyond the time it takes to get in the door. Which is part of the reason it's so hard to do - because the employers know it.

    And foreigners who move here from another country are just as capable of putting down community roots in a new community as someone who moves from the other side of the US.

  • Chip Your Pets||

    There's no loyalty to the employer beyond the time it takes to get in the door.

    Another strawman. I never said it was eternal loyalty. You give me a foreign worker who is forced to be loyal for 3 years, I'll take that in a heartbeat over a US citizen who might monkeybranch to another employer in 6 months. That's what I'm talking about.

    And when they leave in 3 years, I just grab another foreign worker off the pile.

  • ||

    H1-Bs are mainly for people trying to immgriate legally. So it's more like 6 years, while they pursue a green card. And if you are worried about the fact that they can't change jobs, reform the law so they can. Make a green card take one year instead of five.

  • Chip Your Pets||

    t's more like 6 years

    That just makes my point all the stronger.

    Make a green card take one year instead of five.

    Which would exacerbate the employment problem even more.

  • ||

    The number of people coming in on H1-Bs , 0.04% of the workforce, are NOT causing an employment problem.

    And there aren't millions of highly skills tech professional waiting on the doorstep to flood the market with genius programmers who are going to steal the jobs of American software engineers. There just aren't that many super-brilliant foreign engineers, except the ones we've trained at US universities.

  • BambiB||

    Actually, if you look at the number of H-1Bs issued according to ICE, it has AVERAGED more than 260,000 a year for more than a decade. Get rid of them all, and that's at LEAST 750,000 jobs (the H-1B being for 3 years - renewable for 3 more after which many hit the "back door" for citizenship and get at least 2 more years while the application is processed.)

    I'd take 3/4 million new jobs in America today.

    And those jobs create a lot more "downstream" jobs because the paychecks are spent HERE in America. Figure even $60K each, with 70% currently going overseas... that's $20 billion. Divided evenly between $35K jobs and $25K jobs, that's more than 600,000 MORE jobs.

    The H-1B program can be fixed. All one needs to do is auction off the visas. Opening bid is $50K/year. Top 60,000 bids get visas. The money goes to training Americans to replace the imports. At the end of three years - they're done - no renewals.

  • Mithrandir||

    The "employment problem"? In STEM fields?

    You're fucking retarded.

  • Headache||

    3 years? 1 year? Not if they're contracted with TaTa. When the project contract is complete, they're rotated out.

  • damikesc||

    And when they become citizens, they can have the joy of training their replacement under H1B.

    Not due to a lack of competence but because tech firms are worse than the worst of the old robber barons.

    For all of his faults, Ford did far more to benefit the US than Google has ever dreamed of.

  • Sam Haysom||

    Ironically the Chinese actually urge their citizens vigorously to infiltrate American organizatins in order to conduct espionage on behalf of China. So Hazel yet again is completely at odds with reality.

    And who the fuck are you someone who clearly doesn't have a job to call anyone else lazy. Get off your undoubtedly doughy ass and start contributing.

  • Outside the Box||

    ""all forms of collectivism are stupid""

    Absofuckinglutely.

    Still astonishes me I have to hear about what is good for "America" in places like reason.com.

  • JuanQPublic||

    Indeed, and Nationalists, like the statist left, see government as a father figure that guides the stupid people. They want a nanny state that can be leveraged based on their whims of fear. They're afraid of everything, and want daddy to make them feel safe.

    They certainly don't embody the Enlightenment that our Constitutional republic comes from.

  • Chip Your Pets||

    That's not even apples and oranges, that's apples and orangutans.

    Importing Von Braun and the other German engineers brought technological expertise that did not exist in America beforehand. So that made sense.

    Those CS and EE grad students gained their technological expertise from us, not the other way around. We're not gaining anything by keeping them here. So no big loss if they leave, or even better if they never came here in the first place.

  • Citizen X - #6||

    MUH NAHLIDJ

  • ||

    You don't understand what the word "research" means, do you?

  • Chip Your Pets||

    Pretty sure I do. You would feel pretty stupid saying that if you knew who I was IRL.

    Do the foreign students burn all copies of their research when they leave the US?

    They largely don't have initiative in my experience. Professors have to lead them by the nose to find a promising area of research. Especially in CS and EE type fields, research is primarily just finding a crank that nobody's turned yet and turning it, not obtaining stunning insights. It could be (and for a long time was) be done by Americans if our K-12 education (and now even college education) wasn't such a basketcase.

  • OldMexican Blankety Blank||

    Re: Chip Your Brains,

    Do the foreign students burn all copies of their research when they leave the US?


    Are you now invoking I.P.???

    They largely don't have initiative in my experience.


    Your "experience", such as it is, is not evidence for arguing against immigrants. PERIOD.

  • Outside the Box||

    "if our K-12 education (and now even college education) wasn't such a basketcase."

    I don't know who this "our" is, but in either case, what did you expect from a violence-backed monopoly?

  • Outside the Box||

    "Especially in CS and EE type fields, research is primarily just finding a crank that nobody's turned yet and turning it, not obtaining stunning insights. "

    I am a published researcher in these fields and that is complete and utter horseshit.

    As is, even if qualified by the weasely "in my experience",

    "They largely don't have initiative"

    People is people dumbass, and in my day to day job at a major tech firm I see all sorts of initiative (and non initiative) and in no way is it correlated to where someone's mother's vagina happened to be when they crawled out of it.

  • OldMexican Blankety Blank||

    Re: Chip Your Pets,

    Importing Von Braun and the other German engineers brought technological expertise that did not exist in America beforehand.


    You're merely assuming it was so. Yet you also assume the kind of expertise companies need today already exists in abundance.

    Those CS and EE grad students gained their technological expertise from us, not the other way around. We're not gaining anything by keeping them here.


    This is the stupidest comment I've ever read. The argument is comparable to saying that despite paying for my son's college, it bears me no advantage if the little tyke works in my business rather than working somewhere else, because I paid for his college.

    Trumpistas are not only and flamboyantly coming out of the Marxist closet, they're making a spectacle of their stupidity in any forum that allows them.

  • Chip Your Pets||

    Yet you also assume the kind of expertise companies need today already exists in abundance.

    They're primarily looking for programmers. That expertise does exist in abundance in the US.

    Except tech companies (illegally) prefer to hire younger, unmarried foreign workers who will work long hours because they have no connection to the community.

    The argument is comparable to saying that despite paying for my son's college, it bears me no advantage if the little tyke works in my business rather than working somewhere else, because I paid for his college.

    Because foreign students are analogous to a father's children? Not sure what you're trying to do with this analogy.

  • ||

    You don't have to be a foreigner to be young, unmarried, have no girlfriend, and willing to put in 80 hour weeks.

  • Chip Your Pets||

    When did I say that? Was your PhD thesis on strawman generation?

  • OldMexican Blankety Blank||

    Re: Chip Your Brains,

    They're primarily looking for programmers.


    Who is THEY? Do you read minds?

    And saying "there are plenty of programmers" only means you're generalizing in a perfunctory manner.

    Because foreign students are analogous to a father's children?


    No, because your argument makes NO sense, in the same analogous way.

  • Outside the Box||

    "They're primarily looking for programmers. That expertise does exist in abundance in the US."

    Unless "abundance" means "in far fewer numbers than are in demand", you are hysterically incorrect... says this manager at a high tech firm who currently has 25% of his team unhired despite trying everything short of offering BJs.

  • Headache||

    The ideal candidate will have expertise in .net, C#, C++, VB, Java EE7 and 8, PHP and 5 more Languages .MySQL, Oracle, or 7 other DBMSs. CSS, HTLM, XHTML, HTML5,XM, Linux, Windows, IOS etc.etc.

    .

  • Sam Haysom||

    Excellent point. But the USA exists for the benefit of every other nation on earth in Hazel's hatred addled mind. Hilarious that someone who has never had a generous impulse in her life thinks the American taxpayers should be tax cattle for the rest of the world.

  • Mithrandir||

    Undocumented immigrants pay $12 billion in taxes per year. And that's just undocumented immigrants. Surprise, Trumpistas not knowing what the fuck they're talking about.

  • Headache||

    And everyone else pay $4 Trillion. So what!

  • damikesc||

    The benefits they consume DWARF that nebulously crafted figure of taxes paid.

  • john80224||

    I've got to join in. What's the offset on the $12 billion? Just because a number is large compared to what we may deal with in our personal lives, it has little to no meaning without a greater context. If you're going to make the economic argument, what are the costs associated with collecting that $12 billion?

  • john80224||

    I've got to join in. What's the offset on the $12 billion? Just because a number is large compared to what we may deal with in our personal lives, it has little to no meaning without a greater context. If you're going to make the economic argument, what are the costs associated with collecting that $12 billion?

  • GeorgeTyrebyter||

    99% of the H-1Bs are not Werner von Braun. They are ordinary Indians and Chinese. The Indians are not clever. They get ahead in India by cheating. It's the only thing Indians actually do well. IT - no, most Indians are crap at that.

  • Mithrandir||

    Man, for a libertarian website, we sure have a lot of posters spewing collective fucking trash.

  • Inigo Montoya||

    I was thinking the same thing.

    Treating people as individuals rather than as a collective is kinda the whole point of being libertarian.

    But far from every commenter here is libertarian. Many are here to argue or troll, and others are either self-deluded in the middle of some kind transition process where they are still having withdrawals from their major-party brain fogs.

  • Outside the Box||

    Agreed that it's not even worth responding to, both because of the collectivist trash and because of the utter inaccurate ignorance (I work and have worked with many people who grew up in India - not "Indians" - and they, like all people, come in all shapes and sizes and personality traits. I've met some amazing people who grew up there... and some assholes. No different from any other random collection of people).

  • Vrocks||

    This assumes that even 10% are of this status and stature. More like 2% and the rest are just taking our jobs.

  • ||

    We should keep 10-20,000 graduating students,but that's all.They paid for their education here & will make good Americans some day.

  • BambiB||

    Yeah, well maybe we should treat those training programs as classified. Let India develop its own tech WITHOUT America. They can all attend "Bang(alore) U." and work in India hacking third-rate code.

  • eyeroller||

    In related news, Americans (especially Republicans) are begging for more tariffs.

  • Citizen X - #6||

    I didn't realize that Bernie Sanders and all his supporters were Republicans.

  • Chip Your Pets||

    An H-1B visa is often the only way for these students or high-skilled foreign nationals educated abroad to work legally in America. That means new restrictions on H-1B visas would likely block the only feasible means for any foreign-born computer specialists, engineers, doctors or scientists to work in the United States.

    Hilarious to see Reason moaning about the poor foreign workers not being able to get jobs in the US, while labeling concern over American citizen workers not being able to get jobs in the US as "nativism". They know which side their globalist bread is buttered.

    In any case, if we go by Reason's logic, the H1b restrictions should be a boon for the foreign workers' home countries. Seeing as how tech workers are supposed to spread magical productivity dust on whatever economy they get work in.

  • ||

    They definitely would be a boon to the foreign workers home countries. Also many international tech companies have offices in India and China where they can employ those people. If they can't bring the workers here, they will outsource the work, and the entire facility with it.

    It's beyond me. Half the time you people complain about outsourcing jobs and the other half of the time, you insist on exporting the workforce. You aren't going to magically turn working class white kids into tech geniuses by getting rid of their foreign competition. People don't get smarter or more talented because they don't face competition from smarter more talented people.

    If anything, it's the opposite. In my experience, being around smart talented people is stimulating and drives higher ambition. Smart American kids deserve to thrive in an environment where the absolute best and brightest from around the world are gathered. The more brilliant minds you get in one room together, the better.

    When the hell did Americans get all timid and afraid of competition, I wonder?

  • OldMexican Blankety Blank||

    Re: HazelMeade,

    When the hell did Americans get all timid and afraid of competition, I wonder?


    Not Americans per sé, Hazel. Mediocrities have always exited. It's just that they now found their champion, and It ain't F. Murray Abraham.

  • Chip Your Pets||

    They definitely would be a boon to the foreign workers home countries.

    LOL we'll see. Though we've been hearing about the BRICS dynamo spinning up and dominating the world economy for pretty much the entire 21st century so far and it ain't happened yet.

    Half the time you people complain about outsourcing jobs and the other half of the time, you insist on exporting the workforce.

    The concern about outsourcing is that it takes jobs away from American citizens, not that the job is not physically performed in America. Not that I care about outsourcing at all so long as it doesn't impact natl security of course.

    You aren't going to magically turn working class white kids into tech geniuses by getting rid of their foreign competition.

    Strawman. You'll find no greater advocate of STEM education in the US than me. And importing foreign workers for STEM exacerbates that problem by lowering wages and thus reducing incentives for natives to enter those fields.

    In my experience, being around smart talented people is stimulating and drives higher ambition. Smart American kids deserve to thrive in an environment where the absolute best and brightest from around the world are gathered. The more brilliant minds you get in one room together, the better.

    You have a very naive perception of what actually goes on in college and graduate school.

  • ||

    importing foreign workers for STEM exacerbates that problem by lowering wages and thus reducing incentives for natives to enter those fields.

    LOL, the 0.04% of the workforce made up of H1-B visa holders is lowering wages so much that nobody wants to go into STEM anymore.

    You have a very naive perception of what actually goes on in college and graduate school.

    I have a PhD. I went to Cornell University. Apparently you went to a really mediocre school though where everyone was just turning the crank. I guess maybe at mid-level and lower level institutions things might be fairly rote, and you probably aren't getting the smartest American or foreign kids. But at top schools, it's different. The people there have active curious minds and they thrive on competition.

  • Chip Your Pets||

    Bullshit. I got my PhD from an Ivy League school as well. 90% of the theses are just turning a crank.

    Sometimes the crank gets stuck and you have to be a *little* creative and knowledgeable about the previous work in your field, and get some help from your advisor and other contacts, but that doesn't change the fact that it's turning a crank.

    Getting a PhD *is* an accomplishment, a testimony to dogged relentlessness and mastery of your field, but it does not make you a genius inventor whose skill could not have been duplicated by most people had they put in the effort.

    And not only in grad school but also in my later academic career, the "genius foreign students" were often the laziest of the bunch.

  • Headache||

    Ya, but they will pay cash to someone to write a program for them.

  • Chip Your Pets||

    the 0.04% of the workforce made up of H1-B visa holders is lowering wages so much that nobody wants to go into STEM anymore.

    0.04% of the total labor force, not of the STEM labor force. Nice try.

    Many of the pro-globalist studies at least try to warp the data by including computer technicians, data entry positions, etc as STEM occupations to dilute the impact of H1b's on wages, but you didn't even give it that much of a try.

  • SQRLSY One||

    So basically American CEOs will do ANYTHING to fatten their wallets, including black-listing laid-off Americans, in favor of today's "indentured servants", those being H-1Bs…
    So then American students are so discouraged that they stay out of STEM, and go for the much-better paying fields, becoming bankers and lawyers instead!
    Well, let's try and look at the bright side of things… Next big war comes along? The enemy will have tons of engineers, and we will have tons of bankers and lawyers! Guess who wins?
    Then finally maybe we will learn to mind our own business, put our collective dick back in our collective pants, and STAY HOME!!! Yeah!!!

  • ||

    STEM jobs already offer very high salaries compared to most other occupations, and American students still do not enter those fields. What makes you think that marginally higher STEM salaries are going to suddenly stimulate an influx of American students into those fields?
    And at what cost? jobs don't exist for the benefit of the employed. They exist to produce competitive products. If many of the best minds educated at our universities are leaving the country (because they have to) won't that make American products less competitive in international markets?

    It seems to me that you're essentially advocating mooching off of the tech industry by demanding they hire US citizens as charity cases. The tech industry isn't some sort of milch cow to be used to funnel money to protected interest groups.

  • SQRLSY One||

    See my other post, 4 posts down... The actual facts on the ground are, real American corporations (not just fictional ones) are "black-listing", blanket-style, their laid-off employees, so that they'll have more excuses to hire H-1B "indentured servants" instead. As a laid-off employee, you are not ALLOWED to compete with the H-1Bs, not even if you are willing to take a lower salary! This isn't "free market" at all, and doesn't deserve to be defended by so-called "libertarians"! I'm not asking for "charity" for laid-off employees, I am merely asking for a level playing field!

  • OldMexican Blankety Blank||

    Re: SQRLSY One,

    The actual facts on the ground are, real American corporations (not just fictional ones) are "black-listing", blanket-style, their laid-off employees


    Leaving aside for a moment your fictitious concern for the American Worker(TM) which is so sweet and cuddly, the fact that companies "blacklist" former employees is something that is their gawd-damnend right to do, just like you have the right to blacklist your plummer if he didn't perform his job, or all Target stores if you stopped liking their wares. Or am I wrong?

  • SQRLSY One||

    This isn't "fictional" at all; I personally (and a lot of co-workers) were laid off by such a corporation... Which does not ALLOW us to compete! Notice, in a BLANKET manner... Not just some fraction of the laid-off workers, who were drunken or disorderly at work… ALL of them! This is "blanket" discrimination against an entire group of people… Just like discriminationg against ALL people of Mexican heritage, of black skin color, etc. …
    We can argue about a pure libertarian world, but we live in the real world. Where the law grants "corporate" status, in return for IP laws enforcement and anti-discrimination laws, etc. Yes, Government Almighty messes all this up, a LOT! But if we are going to protect other groups from unfair "blanket" treatment, why not the laid-off people?
    Hiring H-1Bs, just to send them back to their home nations, and laying off people and black-listing them (blanket style, and making them move to other cities to get an equivalent job) tears up families. Torn-up families lead to dysfunction and crime. Government Almighty has a legitimate role in looking out for "society", much as I hate to say it. It SURE has an interest in ensuring a level playing field! H-1B today heavily favors corporate elites… And I am not ALLOWED to compete!

  • ||

    There's no legal right to work at Hewlett Packard. And they can't stop someone else from hiring you.

  • SQRLSY One||

    My simple point remains, companies that "blanket"-ban (blacklist) their laid-off employees, should be barred from participating in H-1B. This is a VERY clear violation of Congressional intent (when passing H-1B way back when)... This is a plain and simple "no brainer" first fix... And Trumpster the Plutocrat couldn't even see fit to take such a first "baby step"! Surprise, surprise! Could it be... Because he is a plutocrat, and favors the plutocrats?!?!?

  • Bruce 6225||

    I think stopping the Welfare State Behemoth would allow market forces to make that correction. Without that move it's hard to tell why some might choose any course of action.

  • Outside the Box||

    "the impact of H1b's on wages"

    I appreciate your looking out for me and my wages, but I am ridiculously overpaid in my STEM occupation. Please shed a tear for me.

    [snark aside, the more talented people in my industry, the *better* for me, because it makes my industry more productive as an absolute and a relative to other industries. This ain't no zero sum game, which is really the point of the original article that you continue to miss.]

  • SQRLSY One||

    It's a zero-sum-game for those of us who are "fenced out" of jobs with large mega-corporations, who will not ALLOW us to compete with the H-1Bs, even if we are willing to accept lower salaries! I will believe that it is NOT a "zero sum game", just as soon as anti-competitive corporate policies are removed!
    Wait till you are laid off and "black-listed", in a city where there is but ONE large mega-corporation that has jobs in your area and in your specialty, and your "significant other" and/or kids cannot or will not be re-located, w/o HUUUUGE pains! THEN you might understand!
    For details on the mind-boggling idiocy involved in this incestuous relationship between corporate America and Government Almighty policies, see some of the comments under https://www.thelayoff.com/t/Mf9aLSJ for example...

  • SKR||

    So you're a whiny bitch that is unwilling to move to where the jobs are and you want Uncle Sam to exact vengence of those whom you feel have slighted you? Yeah fuck off moocher.

  • SQRLSY One||

    If Uncle Sam does a half-assed job of insuring a level playing field, yes, Uncle Sam will punish those who will not allow me to compete (at any wage) with the H-1B workers... "Punish" to the mere extent of not giving them any or more allocations of H-1B workers. This is merely following the plain intent of Congress when passing H-1B laws way back when. Is advocating a level playing field, and following the intent of the laws, "mooching"?

  • OldMexican Blankety Blank||

    Re: Chip Your Brains,

    Though we've been hearing about the BRICS dynamo spinning up and dominating the world economy for pretty much the entire 21st century so far and it ain't happened yet.


    And? What does that have to do with anything? If anything, the fact that the brainiacs are coming HERE instead of staying home i a testament to America's freer economy than theirs. So why would you not celebrate this? I don't understand.

    importing foreign workers for STEM exacerbates that problem by lowering wages[...]


    Again with the lowering wages canard? The argument is bogus. The fact is that people's opportunity costs are not driven merely by how much money they can make. I can probably make LOADS of money, GOBS of it, if I were a doctor. But the fact is that I didn't WANT to be a doctor. I didn't want to spend the time and money to be a doctor. I am, therefore, not leaving money on the table for not being a doctor.

  • BambiB||

    In my experience, being around smart talented people is stimulating and drives higher ambition. Smart American kids deserve to thrive in an environment where the absolute best and brightest from around the world are gathered. The more brilliant minds you get in one room together, the better.

    Actually, that was my experience as well - both in mathematics and EE/CoSci. But the "best and brightest" were NOT from "around the world". They were home-grown.

  • GeorgeTyrebyter||

    Since you don't know shit about shinola, you don't know that the outsourcing craze has come and gone. Outsourcing to India means that you get Indian workers with Indian work ethic, and nothing gets done, and what gets done has to be rewritten. Indians are crap at anything technical.

    What innovation has ever come out of India?

  • BambiB||

    What innovation has ever come out of India?

    The Kama Sutra and veggie burgers?

    Sure wasn't sewers.

  • JFree||

    You aren't going to magically turn working class white kids into tech geniuses by getting rid of their foreign competition.

    For the last 40 years, surveys in elementary school have shown that in 5th grade kids love science/tech - by 6th/7th grade they don't. And once they are turned off science/tech, they never return. Everyone (including every science/tech company) understands the problem - elementary school teachers are not very good at science/tech themselves (and this is true everywhere in the world) and even the ones that know that are given no help in figuring out how to keep kids engaged until they can get into secondary school where there are actual science teachers.

    The problem is not that difficult to solve. But no one gives a shit about solving it. It's much easier and more profitable to just free-ride off of the educational systems and public-private partnerships that exist in other countries that HAVE solved it. And then blame American kids.

  • JFree||

    And this elementary school turnoff is precisely why there are more psychology majors and visual/performing arts majors and communications/journalism majors in college than engineering majors. Why there are more PE majors than math majors.

  • damikesc||

    Why do you expect me to give the first iota of a shit about non-Americans?

    China can fix China's problems.
    India can fix India's.

    It is not OUR job to do so.

    If there are so many firms willing to take these H1B dolts in their home countries, then they are more than free to do so.

  • ||

    Reason is showing none with this article.

  • Chip Your Pets||

    Similarly, Madeline Zavodny, a professor of economics at Agnes Scott College, found that foreign and U.S. workers complement each other, with each additional 100 approved H-1B professionals being associated with an additional 183 jobs among U.S. natives.

    The study also found that additional 183 jobs among US natives is associated with 100 approved H1b professionals, so obviously H1b professionals owe their jobs to US natives getting jobs. [/sarcasm]

    Causation? Correlation? Who cares, Reason has got a narrative to push.

    Likewise, a paper by economists William R. Kerr (Harvard Business School) and William F. Lincoln (University of Michigan) examined patenting and concluded, "Total invention increases with higher [H-1B] admission levels primarily through the direct contributions of immigrant inventors."

    IP law is so thoroughly broken at this point that patents are bullshit not useful for measuring invention.

  • john80224||

    Classic Stuart Anderson, indeed.

    He also doesn't point out that the original study didn't provide the results the buyers wanted so they asked her to toss out some pesky years that didn't play nice, and gee, guess how it turned out? He ALSO doesn't point out that when another researcher took the same data but tossed out a couple differently non-compliant years, suddenly a negative association was made.

  • SQRLSY One||

    You know what chaps my butt big-time? That NO ONE seems to want to pay a warm bucket of spit's-worth of attention to the following… And I have written a TON of letters to Congress-slimes, and to media people, all totally ignored!
    Now I have to tread carefully, because I am afraid of getting sued… So the following is totally fictional: The fictional company called "HardLips PeckHard" (presumably like more American-based corporations) lays off American workers, and essentially black-lists them from getting re-hired, in a "blanket" manner… Makes it difficult or impossible for them to get re-hired at HP ("HardLips PeckHard")... And then "HardLips PeckHard" goes and whines and cries to the Government Almighty, that it just can NOT find suitable Americans for those jobs, anywhere!
    Laid-off former "HardLips PeckHard" workers are not ALLOWED to compete with the H-1Bs, even if the laid-off people are willing to take lower wages than the H-1Bs take! WHERE, pray tell, is our "free market" in this case?!
    Companies like "HardLips PeckHard" (who seemingly proudly announce their "black-listing" policy on their internal web sites), for starters, should be totally removed from being allowed ANY H-1B allocations!

  • Mickey Rat||

    "Likewise, a source at Disney told me the 2014 decision simply continued Disney's long history of contracting out IT services, including a $1.3 billion deal with IBM and Affiliated Computer Services back in 2005, nine years earlier, that resulted in a reported 1,000 layoffs."

    That does not really address the criticism that H1B visa holders were not the only workers available who could do those jobs. That the only reason was not lack of skilled labor among Americans, but that Americans would not settle for wages that low, which is an abuse of the H1B program.

  • Ron||

    Also were Americans even asked if they would work for lower wages. working at $20.00 hour is a lot better than not working at 40.00 per hour

  • OldMexican Blankety Blank||

    Re: Ron,

    Also were Americans even asked if they would work for lower wages[...]


    If tech companies are looking elsewhere for techies, then it is clear they DID ask Americans. And are still asking. And not waiting.

    Yet I don't trust your sincerity. If it were the case that tech companies are bringing in higher-wage techies to the US, you would be bitching about tech companies NOT asking Americans if they would want to work for $80 USD an hour and bring up more envy-based arguments and exhortations, or would you now?

    Bottom line is that the inadequate and the mediocre don't like competition. It's all driven by petty envy and jealousy, nothing better that that.

  • Len Bias||

    "That does not really address the criticism that H1B visa holders were not the only workers available who could do those jobs. That the only reason was not lack of skilled labor among Americans, but that Americans would not settle for wages that low, which is an abuse of the H1B program."

    By law, called companies have to pay H1B holders the prevailing wage.

  • damikesc||

    "By law, called companies have to pay H1B holders the prevailing wage."

    Of course.

    "Well, in the field of programmers, IT professionals, and the homeless --- this is the prevailing wage".

  • john80224||

    The prevailing wage is very often below the wage which actually prevails.

  • Ron||

    American techies have been forced to educate their cheaper H1-B replacements before being fired so no it does not help American workers. It also doesn't help the companies in the end because all the people who they fired can no longer afford what the companies are selling.

  • OldMexican Blankety Blank||

    Re: Ron,

    American techies have been forced to educate their cheaper H1-B replacements before being fired[...]


    See me cry for them...

    NO ONE, not you or me, is owed a JOB.

    Get it, Marxist? No one.

    It also doesn't help the companies in the end because all the people who they fired can no longer afford what the companies are selling.


    This specious argument, again? The "Ford Gave Them Mo' Money So They Can Buy Mo' Fords" argument?

    Yeah. It's a DUMB argument.

  • JFree||

    NO ONE, not you or me, is owed a JOB.

    And yet - apparently the science/tech industry IS owed full obeisance by the govt in order for them to find employees. And that is 'libertarian'.

  • damikesc||

    "See me cry for them...

    NO ONE, not you or me, is owed a JOB.

    Get it, Marxist? No one."

    Small problem. H1B is ONLY if they couldn't find Americans capable of doing the job.

    They HAD Americans to do it. They fired them.

    This is a pretty blatant abuse of the entire system.

    But, hey, large corporations have never done wrong. They have never abused their employees. Nope. Never ever.

  • john80224||

    Lost me at "Stuart Anderson". He and his one man show NFAP exist to sell clever wording and misleading conclusions to prove there is essentially no possible downside to any immigration. His article starts off by lying about what the # of applications tell us about the actual demand for the visa. I'm sure it goes downhill from there.

  • Rasilio||

    Ok guys here is the problem you refuse to accept.

    Just because a company says it can't find qualified American candidates does not make it so.

    See all the H1B does is to allow the company to continue with a failed model of staffing, there TONS of Americans capable of doing those jobs, sure some might require a little time to come up to speed on that companies business, technology stack, and design philosophies but the exact same is true of the H1B.

    I'm watching it in my company right now, we've been trying to hire a Senior QA Engineer (a position that is often filled with H1B's) for the last 3 months, we've interviewed half a dozen people 2 of which could have easily been successful on the job but needed a little time to come up to speed on one specific technology, one of which was the first person we talked to almost 3 months ago but we still havn't made a hire because everyone is holding out hope the "perfect" candidate will appear. Fact of the matter is if we just hired that first guy he'd be up to speed on that one technology today.

    Of the 65k H1B's issued a year maybe 10% of them are actually needed, the other 90% could easily be replaced with American workers if the companies just pulled their heads out of their asses and were managed properly.

  • ||

    It's not really that easy.

    Let's say you're a University lab and you have a foreign grad student on an F-1 who is about to get his PhD. You want that guy to continue his research in your lab, but as soon as he graduates, he's got to go on an H1-B so you can hire him as a post-doc. You can't just easily replace that guy with an American, because he's got highly specialized knowledge of your specific research. Top research labs in private industry are the same way. There are people who work in highly specialized fields, and they need H1-Bs to transition those people out of graduate school and into private sector jobs in the US in the same specialized industries.

    There's only 65,000 H1-B visas per year. US industry is not going to waste those slots on code monkeys who could be working remotely from India.

  • damikesc||

    Hmm, is that lab accepting federal monies? Is their school accepting federal monies, including student loans?

    Then tough fucking shit for that lab. And tough fucking shit for that student who has to go back home. Fuck that student. Why should citizens suffer so the lab can employ somebody who no longer should be here to try and milk more money out of the government?

    Why do you, who has no loyalty to American workers, expect anybody to feel bad if their grad student has to leave. Hey, that's life.

    "There's only 65,000 H1-B visas per year. US industry is not going to waste those slots on code monkeys who could be working remotely from India."

    ....yet they do. Odd.

  • Rasilio||

    I beg to differ, I've worked for half a dozen companies that have done exactly that, spent money on H1B's for code monkeys.

    In fact the scenario you outline EASILY falls in line with the 10% I said were valid adn that scenario does not happen more than a few hundred to a couple thousand times a year.

    I once worked for a company in Louisville that had 35 software development staff (Developers, DBA's, and QA combined) on site, 20 were American Citizens, 15 were H1B's on loan from our offshore vendor where we had another 40 people and every single software development shop I've worked at since 2004 had "code monkeys" there on H1B's

  • GeorgeTyrebyter||

    Madeline Zavodny is an idiot who made up her data. It's all fake. The analysis was wrong, and the woman is an idiot.

    https://normsaysno.wordpress.com/2015/02/ 06/update-on-the-zavodny-job-creation-research/

    Reason's articles are written by idiots, clearly. It is results-oriented "journalism". First you write the conclusion, and then distort the information to get there.

  • Inigo Montoya||

    "Reason's articles are written by idiots, clearly. It is results-oriented "journalism". First you write the conclusion, and then distort the information to get there."

    Reason is a LIBERTARIAN publication, FFS! If you think libertarians are idiots, go read stuff by people who agree with your own brand of idiocy. You can easily read articles written by conservatives for conservative readers, or written by progs for prog readers. When I come here, I fully expect to see "the news" filtered through a libertarian lens.

    At least Reason is upfront about their bias. That's much better than the "general audiences" news sites that have an ideological axe to grind (usually left-wing) but purport to be impartial.

  • Outside the Box||

    As a long, long time libertarian, I can barely stand to read any comments on this site, so full it is with trolls.

  • SKR||

    It really has gone down hill over the last 5 years or so.

  • Bruce 6225||

    will hurt companies? not having preferred treatment will hurt? Really?

    ber

  • JuanQPublic||

    So really, Trump and the nanny state nationalists want an affirmative action program for Americans. He wants government to force quotas based on nationality instead of letting businesses hire based on talent and value to the company.

    Garbage in, garbage out.

  • damikesc||

    How dare the head of the US government demand US companies employ US citizens first!!

    Remember: A lot of us don't want the immigrants here PERIOD. I feel no loyalty to Mr. Patel who needs an H1B so badly. Fuck him.

  • Vrocks||

    For somebody who is supposed to be well informed in this subject it is as if you have blinders on or we paid to write this by Tata.

    Everything you say in the article is backwards. And is basically wrong.

    The is no shortage of American engineers, computers or otherwise. This program was created to pay an Indian $56,000 to do my job that I was getting $79,000 for, plain and simple. That is it.

  • john80224||

    Writing this crap is how Mr. Anderson makes his living. What was the Upton Sinclair quote? Something about it being difficult to get a man to see the truth when his livelihood depends on the lie.

  • ||

    This is misguided Libertarianism,the only H-1B visas that should be granted are for graduating students of American Universities,perhaps 10,000 to 20,000. The rest will have to hire American & pay what the market dictates.

  • JFree||

    H1's and H2's are indentured servants. Leave it to Reason to rationalize how indentured servants are really free labor

  • damikesc||

    When Americans, losing their job, are forced to train their replacements or lose their severance packages, then no --- there isn't an issue of a lack of Americans willing to do the job. It's tech firms trying to employ cheap labor with few rights.

  • Davulek||

    This entire article is pretty retarded. No one is disputing that we have to import foreign talent. They do dispute that that talent should be replacing existing American workers. What sane government would enact such a program? None. The program is being abused and was never intended to replace existing workers, but to fill vacancies that could NOT BE FILLED domestically.
    This article is a perfect example of why REASON can be such a let down. Often it is like the content providers are bitching for the sake of bitching and will never be happy with any result.

  • ||

    The article is pure bullshit. I work in the tech industries.

    The techs hire foreigners so they don't have to pay them the wages American's would have to be paid.

    Id they need the foreign workers; then, for menial jobs - average the pay scale of all federal employees and average that value, we will call it csh... to hire such foreign workers they employer must

    1. buy them each a ticket into and out of the country,

    2. pay each worker a value = to 2 x csh, 3. provide each of them congressional equivalent healthcare,

    3. provide a middle income familial housing unit,

    4. 2 middle income vehicles and insurance

    5. escrow a 9 week severance package with full medical and insurance benefits;

    Similar for pedigreed workers, except the worke value is the average of the certified employee index and the multiplier is 5 x the adjusted csh.

    On this compensation basis no business or individual in America will ever need to hire a foreign worker, who is not Albert Einstein, again... there just isn't any need to hire an alien when you have to pay them.

    From domestic help through educators through computer science and zip lines, the employment facts on the ground are "the only reason to hire alien workers is that you can pay them less".

    And that is the way that it is in America.

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