Zoe Lofgren Is Shocked, Shocked at UC’s Behavior

I must apologize for the unusually scathing and sarcastic tone of this posting, but the tale of gross hypocrisy and disinformation I am about to tell easily warrants it. And by the way, there will be a bonus at the end, a dire prediction of what is to come.

The other day Computerworld reported that UCSF, the health sciences campus of the UC system, is replacing many of its IT workers with H-1Bs. Now Rep. Zoe Lofgren, the Queen H-1Bee of Congress, tells the magazine she is shocked that UC would do such a dastardly deed. As I said here recently about Caterpillar’s hiring of H-1Bs,

H-1B is a highly complex issue. But if you take anything away from this posting, it is this: Hiring H-1Bs INSTEAD OF Americans is just as harmful as hiring H-1Bs to REPLACE Americans. Beware of any news article, research report or politician’s statement that dwells on the word replace. Don’t be fooled into barking up the wrong tree, as I have shown before with the example of Virgil Birschwale.

The key word above is politician, and today’s Computerworld interview of Rep. Lofgren is a great case in point, typical political sleight-of-hand on her part. Just as I warned above, she is focusing on the word replace, diverting attention from the real issue, which is the H-1B/green card statute’s disgracefully loose minimum wage requirements. In spite of being termed the prevailing wage, these requirements are typically well below the real market wage.

Lofgren can’t plead ignorance of the law here. It’s not just that she is a former immigration lawyer and immigration law professor, and long-time member of the House Immigration Subcommittee. Much more directly, she herself has pointed out to this publication, Computerworld, that the prevailing wage is well below the market wage:

U.S. Rep. Zoe Lofgren, a Democrat whose Congressional district includes Silicon Valley, framed the wage issue at the hearing, sharing the response to her request for some wage numbers from the U.S. Department of Labor.

Lofgren said that the average wage for computer systems analysts in her district is $92,000, but the U.S. government prevailing wage rate for H-1B workers in the same job currently stands at $52,000, or $40,000 less.

“Small wonder there’s a problem here,” said Lofgren. “We can’t have people coming in an undercutting the American educated workforce.”

This is the central problem with H-1B. That last statement, “Small wonder there’s a problem…,” says it all. Lofgren KNOWS that the central problem is prevailing wage, NOT replace-by vs. hire-instead-of. In other words, Lofgren does NOT want to solve the problem. She’s known about it for years, and done nothing to solve it. (More on this below.) Her indignant statements today about UC amount to rank hypocrisy and political deception of the highest order.

And in turn, all parties involved — including critics of H-1B — are ignoring the elephant in the room regarding prevailing wage, the question of HOW the prevailing wage can be so far below the market wage. The answer, as I have tried — and alas, largely failed — to explain over the years is AGE. Though there are other reasons for the gap, such as prevailing wage not accounting for “hot” skill sets and games being played regarding job title, the largest portion of the wage gap is due to AGE: Younger workers are cheaper, and most H-1Bs are young. 

I can guarantee you that the laid-off UCSF workers are much older, and thus much more expensive, than their H-1B replacements, just as was the case at Disney and SCE. And again, it is not just a matter of replacement by any means; the “Intels” are hiring YOUNG foreign workers instead of OLDER (age 35+) Americans.

Today’s article does say that Lofgren tried to work with Rep. Darrell Issa to fix the prevailing wage provision, by prioritizing the allocation of visas to the employers offering higher salaries. I myself have supported such a policy in principle, but as usual, the devil is in the details, evident in the bill Lofgren introduced the same year she made the “Small wonder” remark. It would have implemented a wage priority system for H-1B, BUT it also would have set up a Staple a Green Card program, effectively a parallel program to H-1B which employers could then use to bypass the H-1B prioritization. Again, this is largely an age issue, as follows.

The Staple proposals, as many of you know, would give automatic green cards to all STEM foreign students at U.S. universities pursuing MS or PhD degrees. Of course, almost all these recipients would be YOUNG, thus swelling the youth labor market. It then would be business as usual for UCSF; they could get all the young foreign workers they want, simply by going a few blocks down the hill to San Francisco State University. Of course, those hired would no longer quite be foreigners, as they would be on track to get green cards, but the effect is the same: The older UCSF workers would still be out of a job.

And once again: The fact that that $60K wage floor for H-1B dependent employers is out of date is a red herring. Employers still must pay at least prevailing wage, which, low as it is, is far higher than $60K. The real issue is prevailing wage, and its relation to age.

Unfortunately, many critics of H-1B are allowing themselves to be duped by the tech industry lobbyists, IEEE-USA, the New York Times and so on into thinking the primary issue with H-1B is replacement of Americans, rather than the age issue. I was saddened to learn today, for instance, that Sara Blackwell, the courageous attorney representing the laid–off Disney workers, has also drunk this Kool-aid.

Pat Thibodeau, author of these Computerworld articles, once praised me for making a prediction that came true about H-1B. Actually, it wasn’t a very sage forecast at all, but mark my words on this one: After Staple becomes law, Pat will STILL be writing about Americans at UCSF, Disney, SCE etc. being replaced by young foreign workers (now from a different source), and Lofgren will STILL be telling Pat, “This wasn’t what the law was intended for.”

 

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29 thoughts on “Zoe Lofgren Is Shocked, Shocked at UC’s Behavior

  1. Zoe Lofgren? My god, this woman is the madam of the whole H-1B Congressional whorehouse. Her customers in Silicon Valley pay her generously to keep them supplied with young, nubile STEM talent.

    Like

  2. Apply the concept of supply and demand taught in the first day of the first course of basic economics.

    If, as H-1B advocates assert, a skill set is in short supply then in a free market that skill set should command a premium wage not an average or prevailing wage. Yet the H-1B law allows employer to pay the lower prevailing wage rather that the higher free market wage.

    In 1776 Adam Smith in the “An Inquiry into the Nature and Causes of the Wealth of Nations” warns us about employers banding together and sometimes with government to reduce worker wages. The H-1B is such an undertaking. Smith said

    “Whenever the law has attempted to regulate the wages of workmen, it has always been rather to lower them than to raise them.”

    What we have in the H-1B is such an unholy alliance of government and employers to protect employers from having to pay the free market wage by manipulating the market with additional supply from foreign lands

    Liked by 1 person

    • >>such an unholy alliance of government and employers to protect employers from having to pay the free market

      Almost – One major missing partner in that alliance is ‘immigration attorneys’ — Let’s not forget it’s these folks that actually write the laws and influence the government *and* employers and make them (govt/employers) think they are in control.

      In an event where ~11m are to be taken through the “legal” process, guess who gets to eat most of the ‘fee’ pie !!

      Like

  3. Age discrimination is impossible to prove. Age discrimination is not politically sexy. What do you suggest if we are all kicked out because of our age? I tried and lost one hell of a lot. Not just money for the suit, but over a year of my life’s productivity.

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  4. What is Logfren’s complaint – that $100k isn’t a high enough figure? I agree! Make it $150k and I might even applaud: *no* H-1Bs below $150k.

    … but if TPP passes, this is all a fart in the wind.

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  5. Amen, we are not being hired simply because they are being hired instead of us.

    All of the government data backs this up.

    As an example, Foreign Born

    and native born aka the American Citizen

    The red line shows the high point that we hit in 2007

    Like

  6. It is hard to feel sorry for those who voted for her or did not advocate for an opposition candidate who supported the American worker. I expect a significant number of those whose jobs are going abroad or to H-1B imports voted for her. It never ceases to amaze me the individuals that the West Coast, California in particular, send to DC.

    We get the government we deserve either from our action or inaction.

    Like

  7. I’m a long-time reader and fan, but I have trouble grasping what seems to be obvious to everyone else, which is that younger workers are much cheaper.

    In my small tech company in the midwest, we hired many recent U.S.-citizen college graduates for a big project, and they all did good work. But they did not work extra hours, unless they got paid more. Also, they were sick so frequently that my CEO had to adjust the sick day policy. One guy often had an excuse for not showing up, and so was fired, but several years later, I learned he was making a six-figure salary in Texas.

    Another guy stayed in the area but switched companies multiple times and then boasted that my company wouldn’t be able to afford him anymore. I just don’t see young workers as being much cheaper or willing to work long hours.

    For one thing, because young workers don’t have much history with any company or family responsibilities that tie them to an area, they’re very willing to move to new companies with higher pay. And everyone wants to get paid as much as they can for their labor, regardless of whether young or old. By the way, I think my company pays well as we do have many long-time employees, but if a younger person sees a better opportunity elsewhere, there’s less holding them back, IMO.

    Could it be mainly that younger, foreign workers are much cheaper (and not so much younger, american workers)?

    http://www.businessinsider.com/the-real-truth-about-the-stem-shortage-that-americans-dont-want-to-hear-2013-5?pundits_only=0&get_all_comments=1&no_reply_filter=1#comment-51aa04946bb3f71628000031

    One commenter to the above article had some interesting insights as a hiring manager:
    “…the majority of younger (as in recent graduates) foreign-born candidates share the most important trait: they are willing to take significantly less compensation for the same job.
    “…the money they can make here, even at the lowball rates big tech pays them, is substantially more than they could make back home.”
    “…I try my best, when hiring, to bring onboard the most qualified candidates. The result is a pretty diverse mix. Some of my peers, however, weigh expenses more heavily than results. Their teams are biased much more toward non-U.S. born contractors. Their budget numbers look better than mine until we look at productivity and customer satisfaction. That’s where my team stands out, and that’s where our overall value to organization excels. ”
    “…So this “shortage” seems to me to be a penny-wise, pound-foolish, disingenuous spin on the part of large tech companies to settle for average talent at a budget price by hiring more and more foreign workers.”
    “…The company I work for is not as bad as many others, but the trend is ominous. And despite the increasing number of non-U.S. workers, our profits have only risen by the payroll savings… there’s been no major infusion of innovation or product/service quality improvements.”

    Like

      • >> Most people find that their wages go up as their career progresses (until they hit the age discrimination wall), so yes, younger workers are cheaper

        Even older workers are cheaper, especially for those in the ‘backlog’ – No pay hikes, no promotions. On the bright side, their jobs are ‘stable’. And this is a growing trend everywhere!

        Like

    • I can certainly understand why they will not work extra hours without compensation if the company is like one I worked for. It was an LLC run by an individual not a partner; he would stand at the door to the office and make note of anyone coming in “late”; it did not matter how long you worked past quitting time the previous evening. He was always out the door when the worker bees left – especially on Fridays with good golf weather. I cannot tell you how much unpaid overtime I put in before I got smart and decided to work what I was paid for and no more.

      American companies also have the obligation to give special consideration to the disabled. Many of these individuals do not have the flexibility of unscheduled overtime, etc. Some rely on transportation that is inflexible; in fact, in the plan available in my city, cancelling too many trips results an a ban on the ability to use the service for several months. That is only one of the issues affecting disabled workers.

      Americans may be involved in eldercare; guest workers cannot bring these family members with them. If you have a sitter sitting with your 97 year old mother who is expecting to leave at a certain time, a late afternoon into evening work session is a problem. I could go on and on why a guest worker with few or no family obligations can work the overtime. I expect this will be less of an advantage when they must be paid for all hours worked.

      Like

  8. I’m surprised that there is so much confusion on this. In my fortune 100 company this is an ongoing way of life. No one is ever “replaced” en masse. They just continue to hire H-1B’s and, more importantly, L-1’s by the hundreds each year to fill open jobs.

    IMO, the L-1 scam (I think it’s L-1?) deserves substantially more attention than it is getting. We’re being told that Indians will not work at our Pune, India offices unless they immediately get a title of “manager,” so that they can move to the US after a year or whatever it is.

    Like

    • >> the L-1 scam (I think it’s L-1?) deserves substantially more attention than it is getting

      Yep – and that’s one thing I have been trying to get folks focus on, but in vain.. all the number gurus are hungry about DOL stats, PERM stats etc, which are available for H-1, but that’s just the tip. The real iceberg is L-1 — no annual caps, no DOL certifications, most importantly no “min wage” restrictions.

      Number gurus salivate on H-1 numbers and try to project it in every possible way they can. But that’s nothing, in my opinion.

      Like

      • I focus H-1B Hunting Licenses on H-1B data simply because that is all that is available.

        If I could find the data for the B, OPT, L, etc., it would be front and center as well because in FY2015 we had approximately 535 thousand immigrants and 10,500,000 or so non-immigrant visas

        http://keepamericaatwork.com/wp-content/uploads/2016/09/FY15AnnualReport-TableIV.pdf

        That is also why I have listed all of the government statistics that I have run across so far at the bottom of this page, and if anybody knows any that I have not listed, please send me a link to them.

        http://h1bhuntinglicenses.com/Reports

        Like

      • I really wonder what the numbers are like. I think we can’t even imagine. I have interviewed at so many global Fortune 500 companies the last few years. It’s always the same 20% of people coming and going from the parking lot / front doors are Indian. (Or seem to be, I’ll admit.) We have about 10,000 people employed in our area for my company, about 5-6,000 of which are salaried workers. At least 1,000 of these are Indians. I’m guessing the vast majority are L-1’s. Add on another 4-5 family members and it’s at least 5,000 of them.

        Like

    • That is so they can get a fast track green card without a wait. The immigration fraud perpetrated by many from this country is incredible.

      If they won’t work without a title they are not entitled to, they should be told to “take a hike”.

      Like

      • >>unless they immediately get a title of “manager,” so that they can move to the US

        >> That is so they can get a fast track green card without a wait

        Cartel has sucesfully manage to burst this EB-1C/”International Manager” bubble – FY 16 has backlogged/retrogressed the entire category to early 2010 for India and the forecast is that it will get retrogressed very early this FY…

        Welcome to the Fort Lee Lanes in Immigration!

        Like

  9. @matloff,

    >> .. After Staple becomes law ..

    I thought the only ‘reform’ packages are from Grassley/Issa/etc and are on ‘H-1B’. Was not aware of any Staple related bill floating around… Recent development?

    Like

      • Prof,

        I believe you are more of a stats and IT guy than an economist, but do you ever wonder what is going to happen when we get to the point of 10 or 50 or 100 graduates for every new job opening in this country? How are we not going to have a total collapse. Combine this with the de facto abolition of anti-trust laws and competition is even worse for employees vis a vis employers.

        Like

  10. According to Newsweek, Trump has business interests in India. He might not be so quick to do things that India does not like.

    http://www.newsweek.com/2016/09/23/donald-trump-foreign-business-deals-national-security-498081.html

    “Last month, scandal erupted over the development, called Trump Towers Pune, after the state government and local police started looking into discrepancies in the land records suggesting that the land on which the building was constructed may not have been legally obtained by Panchshil. The Indian company says no rules or laws were broken, but if government officials conclude otherwise, the project’s future will be in jeopardy—and create a problem that Indian politicians eager to please an American president might have to resolve.

    Through the Pune deal, the Trump Organization has developed close ties to India’s Nationalist Congress Party—a centrist political organization that stands for democratic secularism and is led by Sharad Pawar, an ally of the Chordia family that owns Panchshil—but that would be of little help in this investigation. Political power in India rests largely with the Indian National Congress, a nationalist party that has controlled the central government for almost 50 years. (However, Trump is very popular with the Hindu Sena, a far-right radical nationalist group that sees his anti-Muslim stance as a sign he would take an aggressive stand against Pakistan. When Trump turned 70 in June, members of that organization threw a birthday party for the man they called “the savior of humanity.”)”

    Like

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