H-1B Visas: The Sole Reason Silicon Valley Donated to Hillary

In today’s economy, a great number of professional jobs involve using computers and the Internet to some degree.

Whether it’s social media, website development, IT or programming, a great deal of technical skill is often required for jobs that pay top salaries. For companies in Silicon Valley that are built around technology, any way that labor costs can be reduced is looked at extremely favorably.

For many pure-Web enterprises such as Facebook, Google, Yahoo and others, labor is these firms’ biggest cost, so there’s a huge incentive to cut salaries in any way possible, while still retaining high-quality talent. Eric Schmidt, the chairman of Google’s parent company Alphabet railed that current H-1B visa caps are “the stupidest policy in the entire American political system.” (Perhaps that’s why he volunteered to personally direct digital operations for ex-President Obama’s reelection campaign in 2012?)

When the H-1B visa program was first introduced in 1990, companies found they could typically hire foreign-born workers to work in the United States at a lower cost than American-born workers. And these workers were especially eager to take these jobs because it usually meant that a) they would earn far more money than they could make in their home countries and b) they might have an opportunity to acquire a longer-term visa or Green Card via their new employer if they labored especially long hours. c) they get to move to the U.S. where the quality of life and housing is a vast improvement over their home country.

From these companies’ perspectives, it was a win-win; the firms would get lower-cost employees that would labor harder and be far less likely to complain about adverse working conditions and the foreign-born workers themselves would think they’d hit the jackpot as far as salaries and benefits.

The big loser? American workers, who in the worst cases were actually asked to train their own replacements before being dismissed from the aforementioned companies and other firms where human resources departments and accounting offices realized that huge cost savings could be had by bringing in H-1B visa holders.

At Disney, IT workers sued their employer, claiming that the entertainment company was discriminating against them in favor of sponsoring foreign-born workers for H-1B visas. In 2015, despite record profits for the firm, 250 Disney IT workers were terminated.

Many of them claimed the company had asked them in hastily called meetings to train their replacements via “Knowledge Transfer” sessions, under the threat of being denied severance pay. The workers also said they were told not to discuss the circumstances of their termination with anyone else in the company.

The lawsuit states that Disney fired its previous employees “based solely on their national origin and race, replacing them with Indian nationals.” Disney was able to beat a previous such lawsuit brought by two employees, but the newer suit is a class-action case.

During their presidential campaigns, both President Trump and Hillary Clinton talked about H-1B and other visa reforms. Hillary Clinton, like former President Obama, desired to expand the H-1B program as a reward to her high-tech donors. In fact, there are strong arguments to be made that the entire reason why many of these companies donated so much to Clinton was because of this issue alone.

President Trump, on the other hand, saw the H-1B visa charade for what it was: a way to force American employees out of their jobs and increase profits for shareholders at workers’ expense. Like the notorious free-trade agreements NAFTA, TPP and TTIP, these visa programs often were a way to enrich globalist billionaires, who owned a majority of the related companies’ stocks.

While companies trumpeted that their increased profits would “juice” the economy and likely lead to high-tech stock gains and perhaps even a higher gross domestic product (GDP), voters should rightfully be more concerned about jobs and wages. After all, what good is a growing economy if no one has money to spend?

President Trump has now signed an executive order compelling the Department of Homeland Security (DHS), the Department of Labor (DOL) and the Department of Justice (DOJ) to produce a full legal analysis of the ways American workers are being negatively impacted by current H-1B visa terms. Presently, it’s estimated 85,000 Americans per year are either passed over for jobs or replaced because of these programs.

In the meantime, a new survey of 800 American employers shows that these companies are desperate for H-1B visa limitations to stay the way they are or to become more favorable to employers. As many as 56 percent of companies that were polled said that if President Trump cuts the number of H-1B visas, they would hire fewer Indian workers, while 32 percent said they would definitely increase the hiring of American workers.

Where it gets interesting, however, is that 30 percent of the companies also claimed that new restrictions would cause them to simply hire Indian workers in India, effectively offshoring entire jobs rather than importing talent to the United States.

Sara Blackwell, an employment attorney who’s represented Americans who’ve lost their jobs due to visa programs, says, “[Employers] act like if [Trump is] hard on the visa program, that’s going to hurt talent coming in,” Blackwell said. “That’s the opposite of what will happen; talent will come in, it will just weed out all the abuses of the program.”

As far as offshoring, Blackwell says, “They’re increasing offshoring anyways. It’s all about the top dollar for the top people. The offshoring is worse than the visa program. I sat in on a Goldman Sachs conversation where they said they would offshore if H-1B was reformed. The business model is to use H-1B [in the short term] and then offshore these jobs in the long-run.”

Blackwell said that offshoring is more dangerous than the H-1B visa program. “It’s globalism as an excuse for slavery. It’s a human rights violation for the benefit of CEOs,” Blackwell said. “We can’t compete with $6,000-per-year salaries for employees.”

At the University of California last month, American IT workers who were replaced by offshore workers have announced they intend to sue the school system over discrimination based on national origin and age. The law firm representing the fired employees stated that “to take a workforce that’s overwhelmingly over the age of 40 and replace them with folks who are mainly in their 20s – early 20s, in fact – we think is age discrimination” and that allowing them to be “replaced with people who come from one particular part of the world” (India) is discrimination based on national origin.

The university system claimed that it needed to save $10 million per year for at least five years, but a recent audit of its accounts disclosed a previously unreported $175 million contained in a “secret slush fund,” leading workers to wonder why the schools needed to save money if they had so much excess in their budget.

Ironically, a report compiled by University of California student Gaurav Khanna noted that 11 percent more jobs in the computer industry would have been available in the years between 1994 and 2001 had the H-1B program not been introduced. Khanna’s report also stated that wages in the industry would be at least 5 percent higher without H-1B.

Will President Trump’s executive order make a difference for high-tech and other workers? Website Politico reported that “businesses that use foreign workers, worried they’ll get singled out by federal agents during a visa review, are starting to explore the possibility of recruiting domestic [American] labor.” This is in spite of the fact that the tech industry has long claimed that there weren’t enough skilled Americans to go around for all the jobs its firms have — a claim that’s hard to believe in the face of layoffs like Disney’s.

Here’s hoping that Trump’s executive order leads to concrete action to limit H-1B visas. The U.S. has more than enough computer science graduates to fill the tech industry’s open positions, and if there really was a shortage of workers, that would just be an impetus for universities to ramp up enrollment for their tech and science programs. Most tech companies can easily afford to pay American-born workers what they’re worth. Just ask Amazon’s Jeff Bezos, who’s either the richest or second-richest man in the world depending on which index you look at.


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