The Atlantic Explains H-1B

I actually am a subscriber to The Atlantic, and might even say it is one of my many sources of enjoyment in life. But good grief, it would be hard to find a bunch of journalists who are more disconnected from the way ordinary people live. So, for the second day in a row, I must cite an example of the shoddy work they sometimes do, and their disturbing bias. In turn, the article cites research that itself is demonstrably shoddy and biased.

Specifically, there is the November 30 article, “Not All Immigrant Labor Is Cheap Labor,” by Alexia Hernandez Campbell. Right off the bat, note that this is a funded article, essentially an infomercial. Can it be that such an august, 159-year-old publication such as The Atlantic runs infomercials? Sad but true. And the sponsor, the Emerson Collective, was founded by Steve Jobs’ widow, which might play some role here.

But that pales in comparison to the problems with the main research on which Ms. Campbell bases her piece, an NBER report by Gordon Hanson of UCSD and Matthew Slaughter of Dartmouth. This pair has produced similar research in the past, explicitly funded by the industry lobbying group CompeteAmerica. Needless to say in view of such bias, that old study was very badly flawed. But let’s take a look at this new one.

Best to start out with a laugher. As anyone who reads this blog or my other work knows, I believe there is far too much emphasis in the national discussion on H-1B on the “Infosyses,” and I contend that the “Intels” are just as culpable. Yet Hanson and Slaughter say that my 2013 EPI paper was about the Infosyses! It of course was not on that topic, and on the contrary, was an analysis of the fact that the H-1Bs who are former foreign students are generally of poorer quality than their American peers. They also misquote the findings of the 2010 paper by Kerr and Lincoln, overlook the NBER version of the 2011 Hunt paper and so on.

The authors’ current paper seems to have been put together hastily. There are typos, the bibliography is a mess, etc.

Most of their paper consists of umpteen graphs and tables showing that there are a lot of immigrants in STEM, which is hardly news. But their implication that this means that those immigrants were needed is of course illogical. The only justification they seem to offer is the only-moderate international test scores for U.S. 15-year-olds. I think most 15-year-olds could see through that argument too.

Hanson and Slaughter also seem to be making the “Johnny doesn’t want to go to grad school” argument, ignoring the fact that the H-1B program has made grad school unattractive to Americans. This effect was correctly forecast by the National Science Foundation, something the authors would know if they had actually read my EPI paper rather than misquoting it.

The authors do make a pretty good attempt to answer the question as to whether immigrants in STEM are paid less than Americans. In their regression analyses, they do adjust for a number of important covariates, but unfortunately not the most important of all, occupation. So, they are lumping together well-paid software engineers with poorly-paid life science lab workers, and given the prevalence of the immigrants in the software area, we clearly have a real statistical problem here. Another problem is that they are mixing together immigrants with green card or citizenship status with those who are H-1Bs, L-1s and so, who are exploitable. Nevertheless, they do find that the immigrants earn less. They also find that the immigrants do catch up, which the authors attribute to assimilation while I would attribute to the mobility the immigrants attain once they get their green cards.

The most salient problem in that analysis, though, is the authors’ failure (and that of many others) to account for AGE in the cheap-labor issue. As I have emphasized over the years, the biggest wage savings in hiring foreigners is that the latter are young. Young people are cheaper than older ones, and H-1B is largely about hiring young H-1Bs in lieu of older (35+) Americans.

Though the authors don’t make this connection, they do have a number of graphs showing that the immigrant STEM workers do tend to be young. And they define “young” to be age 25-34, just like I do. Maybe they read my EPI paper after all.🙂

Carrier, Trump and Fallows

I can’t remember ever seeing a President-Elect take steps toward fulfilling a campaign promise before he even takes office. Yet that is exactly what Donald Trump has done in convincing Carrier Corp. to roll back part of its plan to move jobs from Indiana to Mexico. One may take issue with the details, but even some of Trump’s detractors in the press seem to be giving the action some grudging praise.

Carrier is an ironic example, because in the past it was a favorite poster firm of New York Times columnist Tom Friedman regarding the glories of globalization. Yes, Friedman has conceded, Carrier’s IT jobs might be offshored to India, but wait! — those offices in Indian where the IT work will be done will use Carrier air conditioners! A net win for U.S. workers, Friedman explained.

“Well, not so fast,” I countered. Sales of a few more air conditioners in India isn’t going to lead to Carrier hiring more engineers; the design work has already been done, more or less a fixed cost. What about factory jobs? Well, no, no such effect there either, since it will make sense for Carrier to manufacture locally there in India. Yes, Carrier’s profits will go up, but for U.S. workers the offshoring to India is probably a net loss.

Trump’s action with Carrier is arguably Democratic Party-ish. Indeed, it is something that — dare I make the comparison? — Bernie Sanders might have done. It is certainly NOT the kind of thing President Obama has done.

Meanwhile many Trump-ophobes can’t bear to give him any credit. James Fallows of The Atlantic magazine was on one of the SF NPR stations this morning, as a guest on Michael Krasny’s highbrow talk show, KQED Forum. Fallows and the two other journalists on the panel were complaining that Trump is telling his followers not to believe the mainstream press. To be sure, the guests and Krasny made a number of good points, but they also unwittingly showed why the media should indeed be viewed with a skeptical eye.

Fallows is a good case in point. The Atlantic urged its readers not to vote for Trump, only the third presidential election endorsement in its 159-year history, calling Trump a “huckster” and worse. The magazine even ran a major article psychoanalyzing The Donald, and as Fallows pointed out this morning, “We” (the magazine, via the article) concluded that Trump is a narcissist. And the article makes a good case for that claim.

But what did Fallows NOT quote from that article this morning? He said nothing, for instance, on this passage:

In a 2013 Psychological Science research article, behavioral scientists ranked U.S. presidents on characteristics of what the authors called “grandiose narcissism.” Lyndon Johnson scored the highest, followed closely by Teddy Roosevelt and Andrew Jackson. Franklin D. Roosevelt, John F. Kennedy, Nixon, and Clinton were next. Millard Fillmore ranked the lowest. Correlating these ranks with objective indices of presidential performance, the researchers found that narcissism in presidents is something of a double-edged sword. On the positive side, grandiose narcissism is associated with initiating legislation, public persuasiveness, agenda setting, and historians’ ratings of “greatness.” On the negative side, it is also associated with unethical behavior and congressional impeachment resolutions.

But no, all KQED listeners heard from Fallows this morning was that the article found that, Oh my god, we’re doomed, Trump is a narcissist! If one actually reads the article, one finds that the situation is far more nuanced than that.

It remains to be seen whether Trump, once he settles into the Oval Office, will “dance with the one what brung ‘im.” Other than Sessions and maybe Nikki Haley, Trump’s cabinet picks so far raise concerns that Trump will be talked out of loyalty to the ones who put him into office. Yet another Goldman Sachs alum in Treasury? Really? But his action with Carrier, with whatever flaws, is a heck of a good start.

Case in Point!

I often speak here of “the Intels and the Infosyses,” the former meaning mainstream tech firms (large or small) and the latter referring to the largely Indian and Indian-American rent-a-programmer firms. I always write in dismay of the unwarranted focus on the Infosyses in discussions of the H-1B visa program, because (a) the Intels are just as abusive as the Infosyses and (b) I have feared that any reform on H-1B will actually result in a net INCREASE in the number of foreign tech workers in the U.S. , by instituting a Staple a Green Card program. (And by the way, I am just as fearful in (b) today as in the past, as Donald Trump indicated several times during the election campaign that he supports Staple.)

For these reasons, I usually avoid commenting here on articles involving the Infosyses. But this one compels my, and your, attention, as it vividly illustrates some points I’ve been hammering away at for years.

The gist of the article is that Infosys, worried that the Trump administration will tighten up on H-1B policy, is preparing to increase hiring of American “freshers” — Indian English for new grads — to make up for a possible shortfall in foreign workers. There are two major implications of this.

First, it is a perfect illustration of my frequent comment that the standard threat of tech industry lobbyists — “If we can’t get H-1Bs, we will have to move the work offshore!” — is for the most part empty. The industry claim that reducing H-1B will not result in more jobs for Americans is false, as Infosys’ own comments in the article show.

Second, there is of course the age issue. One of my most frequent points in this blog and elsewhere has been that H-1B is largely about AGE: Younger workers are cheaper, so H-1B expands the young labor pool, enabling employers to hire young H-1Bs in lieu of older (age 35+) Americans. And, young H-1Bs are even cheaper than young Americans. But the major savings comes from the age aspect.

I like this article especially because I have struggled to get folks, even the critics of H-1B, to grasp the fundamental role age plays in H-1B, including with the Infosyses, in fact particularly for that segment of the H-1B employer space.

I have seen so many times, in the press and in statements by critics of H-1B, that the reason the Infosyses can hire H-1Bs on the cheap is due to loopholes relating to the Infosyses. While it is certainly true that the law on H-1B and employer-sponsored green cards is chock full of loopholes, it is NOT true that there a special cheap-labor loophole for the Infosyses.

EVERY employer of H-1Bs, both among Intels and Infosyses, is required to pay at least the legal wage floor, the prevailing wage. That wage floor is too low, generally well below market value for the given worker, but both the Intels and Infosyses are subject to the SAME prevailing wage requirement.

Don’t be confused by the fact that the Infosyses must pay H-1Bs at least $65K per year. They are still subject to the prevailing wage requirement, generally much higher than $65K and the SAME as for the Intels.

That doesn’t mean that the Infosyses don’t use the H-1B program for cheap labor. They do! But they use it in the same way the Intels do, which is to use the program to expand the pool of YOUNG workers. And the article cited here shows Infosys itself showing that.


An Outstanding Opportunity for Trump Cabinet Selection

Those who were longing for some peace and quiet once the election was over need to wake up: Donald Trump is going to continue to generate controversy, and be constantly attacked by Democrats and the press, from now until he leaves office. Currently, it seems that most of his cabinet picks will be of that nature.

In a recent post, I discussed Breitbart News but declined to comment on its recent CEO and later Trump campaign chief and cabinet nominee Stephen Bannon. I simply know nothing about the man. However, there is one remark of his I wish to discuss here, as it relates to a recent post in this blog, and to two women whose names are being mentioned as possible cabinet picks, SC governor Nikki Haley, an Indian-American and prominent educational reformer Michelle Rhee, a Korean-American.

Bannon is quoted in the Huffington Post:

“When two-thirds or three-quarters of the CEOs in Silicon Valley are from South Asia or from Asia, I think…” Bannon said. “A country is more than an economy. We’re a civic society.”

It’s not clear what he really meant (and by the way, the article quotes Trump as disagreeing with Bannon), but it would seem that Bannon is questioning whether Asian-origin American CEOs will be loyal to the U.S. Of course, some would counter that people at the top of most multinationals, U.S. born or not, don’t seem that loyal to the U.S. either, but Bannon is raising a fundamental question.

A couple of weeks ago, I posted a piece here titled, “Clinton, Trump, Birtherism and the Perpetual Foreigners,” that latter term being one of the most common complaints among Asian-American social/political activists: Asian-Americans, even those born here, are viewed by many as “foreign.” I pointed out that even Hillary Clinton had engaged in exploiting thinking along similar lines.

Since about 2/3 of Asian-American adults are indeed immigrants, the “foreigner” perception may be rational. And we all know about the long list of ethnic Chinese immigrants who have been convicted of industrial espionage for China. But — excuse a term used too often during the election campaign by both sides — this kneejerk suspicion of Asian-Americans is inconsistent with American values, and just plain unfair.

If Trump appoints Haley and Rhee to his cabinet, he will go a long way to counter that Perpetual Foreigner attitude. He would also score points with many Asian-Americans, and teach a thing or two to those who pronounce “women of color” as if it were a single word rather than a phrase. I know rather little about Haley, but I am a big fan of Rhee, an enormously capable woman who could finally do something about education rather than just expand the number of Dept. of Education bureaucrats. Go for it, Mr. Trump!

UCSF Rally

As I noted the other day, a number of UC San Francisco IT workers held a rally yesterday, to protest being laid off and forced to train their foreign replacements. Several reports have been posted in the press, including one in Computerworld one in the San Jose Mercury News, and one on KPIX-TV, the SF CBS affiliate.

The print pieces have more detail, but the TV report is useful for its visual depiction of the racial diversity of the protesting workers. This diversity is in stark contrast to UC’s post-election statement, which stated that, in spite of Donald Trump’s election,

The University of California is proud of being a diverse and welcoming place for students, faculty and staff with a wide range of backgrounds, experiences and perspectives. Diversity is central to our mission.

That UC would have an official and negative response to the election of a president is, I believe, unprecedented, especially in view of it being at odds with the manner in which UC treats its diverse labor force.

Oakland (UC talk for UC system headquarters) seems to be compounding this PR problem by stating, “UC does not plan to use the H-1B program to bring in foreign professionals…” This seems to be one of those fingers-crossed-behind-back statements that are so common in employer announcements. From the press reports, firms like HCL, not UC, are the actual employers, and of course the workers may be L-1s rather than H-1Bs. So the UC statement amounts to slick evasion, as is the fact that at least some of the training appears to be international communication via Skype.

I heard a rumor, unconfirmed, that UCSF sent an e-mail message warning workers not to attend the rally. If true, that would violate UC policy in umpteen ways, so I presume no such message was sent, but the situation as a whole is already disturbing enough.


In Defense of Breitbart

It may seem odd that a liberal/progressive Bernie supporter (including voting for him as a write-in on November 8) like me would defend the so-called Alt Right publication Breitbart News. But to me — alas, I am a rarity these days — fair is fair. Though I am not a regular reader of Breitbart by any means (see this and other disclaimers at the end of this posting), I must say that the mainstream media seems to be egregiously unfair in reporting on Breitbart, especially now that its former CEO Steve Bannon is now under controversy over a pending key White House position.

For instance, take one of the mainstream media (MM)’s favorite examples in its trashing of Breitbart since the election, an article titled “There’s No Hiring Bias Against Women in Tech, They Just Suck at Interviews.” The MM have presented this article as “obvious” evidence of sexism. Oh, really? What IS obvious is that MM never read past the article’s headline. Actually, the content of the article is quite interesting and important.

The Breitbart piece reports on a serious experiment, conducted by a firm that helps job seekers improve their interviewing skills. The experiment involved phone interviews in which the voices of the job seekers were electronically modified so as to appear of the opposite gender. It turned out that the female applicants were rated lower even when the interviewers thought they were men.

This is quite consistent with what I have observed and discussed here before. What Silicon Valley managers like (consciously or not) in applicants is over-the-top enthusiasm about tech, something along the lines of

The next version of the gcc compiler will enable OpenACC directives, and wow, that will be SWEET! I’ve got a high-end NVIDIA card on my Linux box, and now it will be easy to port the awesome games I plan to write.

Actually, very few female OR male applicants are like this, but among the ones who are, almost all are male. Hence the differential hiring rates regarding gender.

In other words, far from being misogynistic, Breitbart has brought to readers’ attention an experiment that should give the tech world pause for thought.

As I wrote in that blog post, this doesn’t mean that this selection criterion by the managers is justified in terms of job effectiveness. And Breitbart was sloppy to jump to the flat conclusion that there is no gender bias, based on the interviewing experiment. But this sloppiness is what I see in the MM every day, including in the most prestigious MM news outlets.

Indeed, on the issue of the H-1B work visa, I have found Breitbart to be far more reliable — AND LESS BIASED — than the New York Times. Note carefully that the the Times has actually admitted its deep bias. Where is the outrage on this?

Another MM favorite lately has been the Breitbart piece, “Bill Kristol: Republican Spoiler, Renegade Jew.” To me, the article is silly, and as the late journalist Herb Caen used to say, Unclear in Purpose. As a fan of Billy Crystal rather than Bill Kristol, I am no defender of the latter, but to me the article missed the mark.

But the MM again focused on the title, presenting it as evidence that Breitbart is anti-semitic. Really? Not only is the author of the piece Jewish, but Breitbart’s editor-in-chief, Alexander Marlow, is also Jewish. Indeed, another Breitbart editor, Joel Pollock, pointed out to NPR last week that he is not just Jewish, but even Orthodox Jewish. Nu, MM?

None of this is to imply that Steve Bannon is suitable for a high position in the Trump White House. I know nothing about the man. For what it’s worth, Marlow mentioned that every Friday Bannon wishes Pollock Shabbat Shalom (Happy Jewish Sabbath).

Similarly, none of this is to imply that Breitbart does not run some objectionable articles. Since I read it only when someone calls my attention to a piece on H-1B, I simply cannot say what they do in general. And yes, it tends to be raunchy. But at least from the little I know about the publication, they make me glad we have a free press. If we were to only have the New York Times to inform us, we should all say Oy vei iz mir.




Rally Tomorrow in Support of UCSF Workers

There will be a rally tomorrow in support of the UCSF workers who are being replaced by H-1B or other foreign IT specialists. Sara Blackwell, the lawyer who represented the laid-off Disney workers, is apparently the organizer. I’m told that Michelle Malkin, author with John Miano of the H-1B program expose’ Sold Out, will attend. Just to see the conservative Malkin attend a rally in the most liberal city in America, post-Trump election no less, should be interesting.