Friday, February 8, 2013

Senators Marco Rubio, Orrin Hatch, Amy Klobuchar hate America

I posted a snarky blog on H1B Visas last year, but it appears that based on current events, it is time to post again.  I doubt I will say anything that hasn’t been said before, but this needs to be said, over and over. 

H1Bs are a tool of “The Man” to keep America’s record breaking income disparity on track for even bigger numbers.   Yeah!  Maybe we can break a new record next year!

Proponents of the H1B, or increasing the allowed number of them, will tell you heartwarming patriotic tales of the U.S. needing these so we can keep companies on shore, in business, and competing against the world.  Capitalism is the best thing ever, but when you run out of local resources, you have to import them to keep your business from failing.  It’s just supply and demand. We have demand. If these companies can’t get smart employees, they will go out of business and then America loses.  Limit the H1Bs and Microsoft will have to fold up shop, then the Seattle area dies with it, then Silicon Valley and LA aren’t far behind.  Plus, hey, we are forced to pay all these folks prevailing wage.

All of this is horseshit. 

(Sorry, parents who are reading my blog to your kids before bed.  I’ll try not to use that language again…)

Why is it horseshit?  (Okay. I’m not trying very hard.)

Here’s why:

The H1B is simply access to a pool of lesser-paid employees.  In my previous post, I referred to them as indentured servants.  (Work at Microsoft for a few months, and you will see it. Comments welcome.)

Further, when the onshore talent is forced to compete against the indentured servants, they have to put in the same kind of hours the indentured do.  When it comes to supply and demand, the prevailing wage rule doesn’t let the market come into play.  The extra supply of labor hours drives down demand.  It’s just that simple.

H1Bs are anti-American and chip away at the American Dream every day.  One could make an argument that the visa is just opening a bigger market, thus very capitalist. But seriously, I kind of want America to be around and to have jobs when my kid grows up. 

Here’s how the H1Bs are ruining America.  If we stop or cut the H1B numbers, the demand for smart people goes up.  With demand up, wages go up.  Wages don’t just go up for the top tier professionals; they go up for every other tier as well.  Crap, there goes our chance at another Guinness Book Income Disparity Record.  If the wages go up, the jobs get much more attractive to America’s youth.  If demand for those jobs goes up, we need more training institutes for whatever technical jobs are in more demand.  Kids will go to college and get smart if there is a path to riches.  Right now, average wages for many of these jobs are comfortably nice, but they don’t scream, “Learn me, you can vacation in Park City every year and drive an Escalade!”

The H1B keeps kids from seeing any American Dream, so the ones lucky enough to afford college just get yet another Art History Degree and fill out that McDonald’s job application.

I have met a few folks who have left tech for trade jobs, because the pay is similar and the stress is lower.

One might make a claim that there is a short term need for the smart folk, as American kids aren’t up to speed yet.  I concede the possibility, but how do we fix the cycle?  On our current path, it seems that we don’t, we just continue to import cheap labor.

The market only works for us if you let it.

If that were the end of it, one might be able to let go.  As it turns out, and I won’t pretend to know everything about these companies, many of the big consumers of H1Bs are foreign owned companies who rarely hire Americans and specialize in filling headcount for companies who can’t get H1Bs or have more than their fair share. These companies are funneling their revenue right out of America.  These aren’t even American companies in need of talent, hoping they can compete!

Don’t get me wrong, I don’t hate foreigners; I worked with some great ones at MS and many great ones at T-Mobile.  What I want is to protect America, its future, and its market for high paying jobs.  Keeping wages low in this manner hurts America.  We need to fix this for our children.

H1B visas are nothing more than a way to keep money out of the hands of workers and in the hands of execs and larger shareholders.

Taking a look at some of the top H1B sponsors, I can’t help but notice three distinct categories.  We have offshore consultancies, household name tech companies, and banks/wall street firms. None of these companies are lacking in cash to bump up the pay of their employees or to fund training and education for the lesser employees with potential.  This is pure greed.  

Here a look at H1B data for 2001 – 2012

Household Names




Microsoft Corporation



IBM Corporation



Oracle Corporation



Intel Corporation



Qualcomm Inc



Accenture Ltd



Cisco Systems, Inc



Google Inc



Hewlett-Packard Company



CVS Rx Services, Inc. dba CVS Pharmacy



Rite Aid Corporation




Wall Street







JPMorgan Chase & Co



Goldman, Sachs & CO



Bank of America



Merrill Lynch & Co., Inc



Credit Suisse First Boston






Capital One Financial Corp




Offshore Consultancies




Satyam Computer Services, Ltd



Tata Consultancy Services



Infosys Limited



Larsen & Toubro Infotech Limited



Wipro Limited



Infosys Technologies Limited



Cognizant Technology Solutions



Patni Americas, Inc





Well, at least Steve Ballmer gets to keep his fleet of Ferraris.

…And Larry Ellison gets to keep tropical islands.

…and our children will get to keep…what?


Anonymous said...

What is the record of Dianne Feinstein and Barbara Boxer (both Democrats from California) regarding H1-B visas? (Recall that the Senate is controlled by Democrats.) I agree that Rubio and Hatch are idiots for supporting the visas, and this whole issue provides yet another reason for hating Bill Gates.

Anonymous said...

"tropical islands"?

"fleets of ferraris"?

"The H1B keeps kids from seeing any American Dream, so the ones lucky enough to afford college just get yet another Art History Degree and fill out that McDonald’s job application."

You nailed every jealous image of wealth while arguing your point except "cackling maniacally whilst diving into his money bin."

Look, I understand your point and where you're coming from, but you're embellishing to such a degree that its hard to take this seriously.

If you examine the economic reality of protectionist policies, you'll find that it benefits certain people at the expense of everybody else. If you look at steel import tariffs for instance, you'll notice that it benefits certain industries at the expense of the economy as a whole. Prevent the free exchange of goods and services only harms the economy as a whole, regardless if its steel or oil or programmers.

Right now my suspicion is that you're only concerned about H1Bs because you're concerned about it being a threat to your potential income.

Don't worry, it's not a threat to you. More programmers is an opportunity. Smart people being able to cross artificial borders and work with other smart people only increases wealth over time.

Everything that stops ideas from being spread, whether its DRM or intellectual property or trade and employment barriers only decreases wealth. It's not suddenly different just because you think you recognize a short term benefit.

If you're intelligent enough to program a computer, you're not going to end up flipping burgers unless you make horrendously bad life choices. As far as bad choices goes, getting an art history degree is one of them.

There are many gross injustices in the world, but H1B being let into this country isn't one of them.

PS: Having some friends who have experienced this system, you should find and talk to people who try and immigrate to this country and see how difficult it is to get over here. They're not opening the flood gates and letting the unwashed foreign hordes in.

Anonymous said...

Some H1Bs are essential, some not. The bathwater is the trivial H1B work at companies like Microsoft. The baby is the high level research in hard science which almost ZERO US educated candidates are capable of.

Richard said...
This comment has been removed by a blog administrator.
Richard said...

You are a racist.
P.S. Im an American.

Anonymous said...

Satyam Computer Services look to be not much more than a people trafficking operation.

Anonymous said...

As an "immigrant" and now the founder of a company here in the US, I speak with some first-hand experience. The fundamental issue I have with such arguments "without h1b my salary would be higher, and so would every american" is so inane....It is fundamentally a spoilt entitlement attitude....You should see 80-90% of the resume padded idiots I interview.

The pro and con arguments have been done to death. Really the only way to convince yourself is to found your company (and if you are as good as you think you are Dunning-Kruger effect notwithstanding) instead of working for Microsoft or whomever. Why not start your own company instead of pontificating? why not follow your own preachings and hire "Americans" and...well get
your own ferrari fleet.

No question a good proportion of H1b are unqualified, but that's true for everything including the "Americans" I interview.

Anonymous said...

You are an idiot...

Florian said...

You are correct in your assertion that H1B visas are a means to keep IT-wages low, this works in two ways:

- Create a local labor surplus, thus depressing labor price
- Imported labor may often not ask for as much salary as local labor

You are also correct that H1B visas should stop (much to the chargin of foreign labor of course, I'm a foreigner btw.)

You are however incorrect to assume this would change anything. Companies are outsourcing (porting the work to foreign labor) no matter if local labor is cheap or expensive, and no matter how much labor they can import.

If you are competing on a global scale, where your work can be performed by anybody with an internet connection anywhere on the entire globe, your local labor is under more pressure regardless.

If you want to reverse that trend, your local labor needs to be more competitive. Neither passing laws on outsourcing or modifying H1B visa rules will accomplish that.

There are a number of reasons why US labor is not competitive on international labor IT labor markets, a few of them are:

- The US tax code: the IRS and the extremely convoluted tax code make it difficult for everybody in the US to engage in an agile, competitive labor market.
- Regulatory overhead on companies: Incorporated and even worse public companies must comply with a set of extremely bothersome rules permeating the entire company structure and creating artificial climate inefficiency.
- Expensive healthcare and the culture of companies to offer it: Your healthcare system is broken/expensive, and it puts a large burden on small companies that could provide US labor on international markets.

There are many more factors, some much less flattering than the ones already mentioned.

If you are gonna ask yourself how can you change it, how can the US compete on international IT labor markets, ask yourself this: How can you make a US IT-worker compete against a freelancer from China or India that has graduated from their top polytechnic university with a masters in computer science and a bachelors degree in business.

There is a lot you will have to change, I suggest you get started instead of moaning about H1B or outsourcing.

Guy said...

You see the same dynamic all over the place. Step away from the IT arena and look at migrant worker's impact on agricultural labor.

Sure, cheap labor (aka 'slaves') from Mexico means everybody gets cheap food.

But the reason Americans won't do that work isn't how hard or tedious it is, it is entirely about the sub-par pay.

If the day came that Guatemalans, Mexicans, etc. had something better to do back home you would see the wages for the labor they do go up and that's just some hard, fast math there.

And yes, the price of your lettuce would go up. But it'd still be only a fraction of what people pay for other goods and services in their lives with the added benefit that more Americans would be gainfully employed.

Anonymous said...

Why complain about a few tens of thousands of H-1B's? Millions come in over the southern border and no one is supposed to complain. I guess that cheap landscaping is good for Mark, but cheap computer programmers are not.

Justin Tipton said...

Having worked for a large software company and recruited multiple university, there is not enough talent in America. Maybe there are enough software engineers, but high quality rock stars? No way. We need H1B's and we need competition.

Besides, if you are smart, and the pay is sub-par, and it is, you'll do as I did and start your own business making more money than working for the man.

If you want the security of a M$, don't complain about the pay, long hours and smart foreigners.

Anonymous said...

couldn't agree more: H1b is pure poison for everything it touches. Imagine the outrage of taxpaying citizen workers, that now have to fund a system/government that allows companies to operate here and to dump in tons of low/no-skilled wage depressing job-robbers ??? is it crazy ? It's happening right now, STEM workers have to fund their own wage depression. Stop the b/s H1b now, let your rep's know this is toxic and needs to be put down now!!!

Anonymous said...

To : all
From : USA CITIZEN(does not mean much)

Currently for most positions in Gov or private sector you are required to pass a background check.
This is an attack against US citizens.
First they can run a back ground check on a US citizen easily and go back in years to the childbirth if they want to. When they find anything wrong they disqualify the US CITIZEN -then they can justify a H1B hire!! ("we looked for a US citizen first....")
In the case of a H1B at most on the background check the most they can go back a couple of years maybe if the H1b was "in country at a US University"
Here is where our civil rights are being violated ------the H1b is not held to the same standard!!!! specifically because they cannot check the H1BS----congress and the house were PAID OFF 1billion last year by the "special interest groups" -I hope congress and house
are completed voted out --they suck and they know it.

JR said...

Mark you're exactly right. You have courage to say it. H1B visas push Americans out of Tech jobs by making them compete with a huge surplus of foreign workers. The fat-cat CEOs say that "it helps the economy" but 50% of American STEM grads can't get jobs. I guess that the "economy" is helped by Americans being denied good jobs but at least they can deliver pizzas to all the foreign H1B indentured engineers.... maybe they'll get a tip now & then.

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