A Know-Nothing Congress
Sometimes we forget, or want to, that we did not elect geniuses in every subject to Congress, we elected people we hoped would be good managers, like the simplest company can hire to handle purchases, and they would gather facts and spend our money wisely. Of course, that simple business would fire any manager that accepted gifts or any sort of benefit from salesmen, so that is not the kind of manager we got; we got the ones that accept and even demand gifts and are not upset that only 13% of the citizens think they are trust worthy. They know they can lie to us with half truths, and use our money to pay back campaign contributors, and we can't get them fired because they own the microphone.
H-1B is an issue that would get them fired if that was possible, here is what they say they learned from their hearings (hearings look like evidence gathering, like you might see in a court, but the rules would make Judge Roy Bean blush.)
What Congress tells us they learned from taking money from lobbyists and then listening to them (I am not joking, John Kerry said that if you get the money first, then they are not paying you for a favour. If that was so, 95% of drug sale convictions would be thrown out)
If you think that in a capitalist economic system that companies compete on wage and offer workers more money to get better workers, and do not offer public services (the rights you get with a green card) as an inducement to come to the USA to work, you can forget that; these companies expect the tax payer to educate the children of their foreign workers, and after citizenship and "family reunification", they expect the taxpayer to take care of those expenses, thus socializing the cost of their labour, just as banks expect that the taxpayer will take care of their gambles on the housing bubble. Socialized expenses, but private profits. Do you really need to give up a raise this year so that the billionaires at Google, Microsoft, Face Book, and Oracle can take home a few more million?
What they heard:
1. There is a shortage of skilled engineers. Not a shortage of engineers willing to accept the low wages they are offering, but a real shortage.
2. The skills they need are not available from US citizens, only the citizens of low wage countries like India and China.
3. The only people that have those skills want green cards and to come to the USA, and have the US taxpayer, not the employer, provide them services.
4. US schools are horrible, a disgrace. Ignore the fact that foreign geniuses want to bring their children here and put them in those schools.
5. Indians and Chinese are smarter than Americans.
6. The H-1B makes the US more competitive by bringing the world's best and brightest here, where they can work with other Indians and Chinese (not stupid Americans, right?)
7. The best and brightest are willing to work for Wall Mart for $35,000 which is less than the 1995 entry level wage for an IT college graduate.
8. Some Indians and Chinese are really good, everyone agrees on that.
9. Indian and Chinese engineers make US business more profitable.
The facts are:
1. No reliable study has ever shown any lack of skilled Americans willing to work for wages similar to other professions with the same demands.
2. Many of the immigrants employers want to hire were trained in US universities by "old men" (over 30) that the industry does not want to hire.
3. US citizens will not accept a green card in lieu of wages, that is true.
4. There is no one US school. US schools that are not burdened with illegal aliens are generally doing fine and the USA graduates many of the best scientists in the world.
5. You can prove that by looking at India and China, but no study shows that.
There are billionaires in India and China, if these guys,and their pals are so smart, why are they here?
6. The H-1B program distorts the wage market (just as it is designed to do), and discourages US students from entering it (just exactly as the National Science Foundation said would happen in 1989).
7. If so how do we know that they are bright?
8. In the 500,000 US born engineers they replaced, there were also some really bright people, and everyone agrees that is true.
9. Indian and Chinese engineers deny jobs to US engineers on whom our future security and industry depend.
The facts are, the H-1B program is all about cutting middle class wages, just as Alan Greenspan said was good for Wall Street, and bad for workers.
It is just about wages, not a bit about the best and brighest, BUT it has replace more than 2 million Americans, who were willing to work hard for a decent wage, with 2 million lower wage, and often resentful, legal aliens.
Dr. Norman Matloff at the the University of California at Davis has analyzed government data and compared it to industry claims and found them wanting . What follows is an extract of his work, the full text can be found at:
CohenAndGrigsbyPrevailingWage.txt
Date: Sat, 23 Jun 2007 21:33:22 -0700
From: Norm Matloff <matloff@cs.ucdavis.edu>
To: Norm Matloff <matloff@cs.ucdavis.edu>
Subject: Cohen & Grigsby and the prevailing-wage scam
To: H-1B/L-1/offshoring e-newsletter
I've constantly harped on the fact that the reason employers are so
anxious to hire foreign workers is that they use those workers as cheap
labor. I've also repeatedly stressed the fact that the crux of the
abuse of the H-1B and employer-sponsored green card programs is the
LEGAL LOOPHOLES in the prevailing wage requirement which both of those
programs have. These loopholes enable employers to pay their foreign
workers well below what they would have to pay Americans. In short, the
legally-defined prevailing wage is typically well below the real market
wage.
Here I will give readers a further look at how Cohen & Grigsby, the law
firm in the YouTube scandal, makes use of these legal loopholes. You'll
see some intriguing data, with big implications. You'll also see
another egregious example of public statements by the firm which are
exactly the opposite of their private actions.
I looked at all the PERM (green card) applications filed in 2004 by
Cohen & Grigsby for Software Engineer positions. (This is from a Dept.
of Labor Web site, http://www.flcdatacenter.com/CasePerm.aspx Note that
this is NOT the LCA data. The salaries here are guaranteed to be the
actual salaries for specific workers.)
Here are the results, showing the actual salary, claimed prevailing wage
and employer name, sorted by salary:
45000.000000 42390.000000 "Algor Inc."
45150.000000 44762.000000 "Bayer Corporate and Business Services LLC"
49504.000000 44762.000000 "Bayer Corporate and Business Services LLC"
60980.000000 64189.000000 "Hexware Technologies
.... (see site for full data)
88000.000000 67621.000000 "Ansoft Corporation"
110000.000000 70242.000000 "Ansoft Corporation"
Now, first of all, let's confirm what we already know. Of the 83
entries, 74 are less than the OES mean for 2004, $77,330, for Software
Engineers, Applications, and 79 are less in the case of Software
Engineers, Systems Software. Remember, this is perfectly legal, but
it certainly shows that these people are hired as cheap labor.
But I want to call your attention to something different. I sorted the
data by salary in order to highlight the fact that there are a lot of
DUPLICATE ODDBALL SALARIES--for different employers. In other words,
you have several employers offering exactly the same salary, in fact,
the same non-round-number salary.
For instance, 8 different companies, ranging from Bayer Corporate and
Business Services LLC to Union Switch & Signal Inc., ALL
"coincidentally" were paying their Software Engineers the SAME salary of
$64,420!
How come? Well, prior to the law enacted in December 2004, employers
were allowed to pay 5% below prevailing wage. And if you look at the
prevailing wages, in the second column above, you will see that that
$64,420 figure is exactly 5% below prevailing wage! And if you look at
the other applications listed above, you'll see that most are also
exactly 5% below their prevailing wage.
Now, don't jump to conclusions here. THIS 5% IS NOT AN INTERESTING
LOOPHOLE in its own right. I'm not pointing to the fact that Cohen &
Grigsby was taking advantage of that extra 5%; that's nickel and dime
stuff. No, look a little deeper.
What this data shows is a lack of a competitive market, with two
interesting implications:
1. We have a bizarre situation in which "the tail is wagging the dog."
The law firm is telling the employers how much to pay their workers!
And it's telling them all to pay the same amount.
2. The Americans hired by these companies undoubtedy vary from each
other in their salaries, because they can negotiate. In other words,
you see that THE FOREIGN NATIONALS ARE IN NO POSITION TO NEGOTIATE.
This shows yet another way in which the employers can get away with
paying foreign workers less than Americans.
Please recall that the prevailing wage is typically a lowball figure to
begin with, well below the market wage. Though the press accounts have
focused on the firm's comment in video 9 on how to avoid hiring
Americans, video 12 is just as damning, as the law firm talked about how
to get a prevailing wage that can be, in the Cohen & Grigsby attorney
Jennifer Pack's own words, "$10,000 to $15,000" below the market. Yet
the foreign nationals accept this lowball salary, because in the deal
they are getting a form of nonmonetary compensation which is highly
valuable to them--a U.S. green card.
I love exposing hypocrisy. Recall that in my original analysis of the
TubeGate videos, at
http://heather.cs.ucdavis.edu/Archive/YouTubeVideosH1B.txt
I pointed to the rank hypocrisy of the Cohen & Grigsby firm. One of the
firm's attorneys, Matt Phillips, told the Pittsburgh Post-Gazette that
employers do their best to try to find Americans to fill a spot before
resorting to hiring foreign workers--when in the videos, in which
Phillips speaks, the firm is telling employers how to AVOID finding
Americans.
Well, I'm including below an even more outrageous example of the firm's
hypocrisy below, this one on the prevailing wage issue. This is an
op-ed by Larry Lebowitz, a partner in the firm who served as the MC in
the YouTube videos. I'm including the full text below, but here are the
highlights:
First, Lebowitz again claims that employers do their best to find
American workers:
# U.S. companies that bring in foreign professionals usually do so as a
# last resort
By now you know that there are a number of statements in the videos
which show that to be a lie.
Next, Lebowitz assures readers:
# To hire H-1Bs, a company must: Guarantee the H-1B will be paid the
# prevailing wage or better...
Again, remember in the video, the firm shows how the prevailing wage is
typically lower than the market wage.
And get this one!
# These rules actually help U.S. workers, too, by keeping wages high,
# ensuring that U.S. workers are not displaced and keeping corporate
# productivity high.
I'm trying not to constantly use the word "chutzpah" in my series of
postings on Cohen & Grigsby, but what other word fits? I guess I can
say, "unmitigated audacity." :-)
Now, no lobbyist op-ed and planted article would be complete without
examples of "poster child" companies that supposedly are desperate to
hire, can't find American workers in spite of herculean efforts, and
"must" hire H-1Bs. Well, one of Lebowitz's poster children here is
Marconi Communications, a major firm you may have noticed in my PERM
data list above. For instance, Marconi was one of the eight firms that
were all paying their Software Engineers exactly the same oddball figure
of $64,240. Some desperation, huh?
Norm
Pittsburgh Post-Gazette
We need the best and brightest
The growth of Pittsburgh technology firms is hampered by a freeze on visas
for skilled foreign workers. Let them in.
Sunday, May 21, 2000
By Lawrence M. Lebowitz
CoManage Corp. is a Wexford-based developer of software packages for the
telecommunications industry. Like many high-technology firms, here and
elsewhere throughout the country, the company depends on high-quality talent
to develop products and move them to market fast, before the competition.
The problem: There's a shortage of domestic software engineering talent.
(see link for the rest)
also see: How To Under Pay H-1B Workers
