Did H-1B Cost Hillary Florida?

A reader called my attention to Softletter.com’s post on the H-1B work visa, with this intriguing passage (emphasis added):

At Disney and SoCal, the laid off workers trained their foreign replacements under threat of losing their severance pay, making a mockery of the claim that the H-1B program was filling technology holes at either company. Rather, the clear goal in both cases was to replace highly skilled American workers with more cheaply paid foreigners. From a PR standpoint, both initiatives were disasters, with the Trump campaign focusing attention on the plight of the laid of workers in certain venues, while the Clinton and Sanders forces were largely silent on the issue. Sources we have within the RNC have told us H-1B was a significant contributor to Trump’s narrow victory in Florida.

I’m rather skeptical of this. In spite of all the publicity given to the Disney case and Disney victims such as Leo Perrero courageously choosing to speak out, most voters simply do not keep abreast of daily news.

But I will say that if voters really knew the true story of H-1B — especially the fact that virtually every employer abuses the program — and if they knew about Hillary’s “Let them eat cake” view of H-1B, tons more voters would have turned against her. Her near-100% support from the tech industry would have been just as toxic to her as her enriching herself by giving speeches to Wall Street whose transcripts she refused to make public.

In a Vox interview during the election campaign, Hillary (a) exhibited a real understanding of the H-1B problem but (b) said H-1B is good for nation even though American techies are harmed. Point (b) is especially galling in light of (a). She says

I think it’s because everybody with six degrees of separation either knows or thinks they know someone who knows somebody who lost a job to an undocumented worker or to a worker brought over on a visa to do their job. There’s just a lot of churn that suggests this is a real problem.

but speaks of

…the immigrants who fill jobs we need, particularly high-value jobs…

Of course, this is just the deliberately fallacious “Intels Good, Infosyses Bad” yet again, and, upon close inspection, the same as what Trump has said consistently since August 2015. But Trump brought up the issue himself and railed against H-1B, whereas, to my knowledge, Hillary never once mentioned the issue; she only addressed it in that interview because she was asked about it. And even then, in essence she dismissed people like Perrero, as one reader put it, as collateral damage.

Perrero, of course, is a rare exception. Two more are a victim of Cisco and one of Texas Instruments. But again, very rare. Would you speak out in their situations, and risk blacklisting by employers? One man who challenged Sun Microsystems (later acquired by Oracle) soon found himself working in retail sales (non-tech-related).

I recently was invited to speak at the San Francisco branch of the EEOC. While there, I asked them about this huge obstacle; what should victims do? One of the more senior EEOC people replied:

Filing an EEOC case requires a strong backbone and a strong stomach. Anyone considering it should first check their backbone and then check their stomach.

In other words, even the EEOC concedes that the system is stacked against the victims. Hillary’s Intels Good, Infosyses Bad comments vividly reinforce that point.

Ironically, and once again illustrating the high complexity of political campaigns, an anti-Hillary ad  during the campaign pointed out that Hillary has been quite cozy with the Infosyses for years. Barack Obama ran a similar ad in the 2008 primary election, but withdrew it and apologized, not wanting to appear anti-Indian. The ad last year also seems to have been quietly dropped, likely for the same reason.

If only voters knew…

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Immigration and Welfare Use

I’ve lived in immigrant households all my life. My dad was an immigrant, and though Mom was born in the U.S., she had the Old World view. My wife is an immigrant.

In the early 1990s, my connection to immigrant communities exposed me to rather shocking (but legal) abuse of two government programs. You already know one of them — the H-1B work visa program. The other was abuse of welfare programs by elderly immigrants, both in the form of cash (SSI) and noncash assistance, the latter consisting of Medicaid, subsidized senior housing and miscellaneous aid such as reduced telephone service rates (Lifeline).

During that time, I gave invited testimony to the U.S. Senate, wrote an invited article for The New Democrat (a magazine started by the Clinton wing of the Democratic Party) and so on. As a statistician, I analyzed the data and as a Chinese speaker I interviewed many Chinese seniors who were receiving such aid, as well as social workers, immigration lawyers and so on. Note carefully: I do NOT blame the seniors for this abuse, as they are unaware, but their adult sons and daughters who sponsor them are indeed culpable.

Among other things, I showed that most of the seniors receiving aid actually had well-off sons and daughters, and were living with them. During that time, a typical scenario in Silicon Valley, for instance, was that of husband and wife both from Taiwan, both making good money as engineers, and living in an expensive house — and with the down payment for that house coming in part from SSI money from the old folk. The latter would also serve as babysitters for the grandkids, and when the grandkids got older, the seniors would move into government-subsidized senior housing. The seniors would enjoy yearly trips back home to Taiwan — people on welfare enjoying international vacations, while some American black people on welfare had never even seen the ocean. Again, all of this was legal (with one possibly questionable aspect), and indeed promoted by the federal government.

You may find this transcript of my appearance on a Bay Area Chinese-language TV show to be informative.

I haven’t looked at this issue for years, but one of Alan Tonelson’s blog posts inspired me to comment now. So, what has happened since I was researching this nearly 20 years ago?

First of all, in 1996 Congress passed, and Pres. Clinton signed into law, a general welfare reform plan that did include provisions for immigrants. It basically banned green card holders from receiving cash forms of welfare, though the immigrants need only naturalize to receive such aid. Needless to say, naturalization rates soared. But as Alan points out, there is still lots of noncash assistance available even to the ones who have not yet naturalized.

One big example is subsidized senior housing. If you visit such locations in almost any large urban area, you will likely find it populated almost entirely by elderly Asian immigrants, with long waiting lists.

My understanding is that Canada recently changed its immigration policy so that foreign seniors with Canadian adult children could only visit Canada.  The visit durations are generous, but the old folk now cannot become citizens and be eligible for welfare.

One more important point: In the 1990s, this was a bipartisan issue. The Democrats actually took the lead, extending the period to become eligible from three years to five, in 1993 when they still held Congress. And though the Republicans took over Congress in 1994 and wrote the welfare reform bill that was eventually enacted, the Democrats had their own proposal, only slightly less draconian in terms of immigrants, and of course Democratic President Clinton signed it into law. That is not true today, of course, and if Trump clamps down, expect opposition from the Democrats, and of course from plaintiffs in the Ninth Circuit.

Update: After I posted the original version of the above, a reader wondered if the 1996 law had later been changed. Looking at the government instructions for applicants we see that the statute was indeed amended to grandfather those already receiving SSI at the time of enactment. As noted, I have not been following development for quite some time now, and had not been aware of the grandfathering, though I did advocate it at the time (and still believe it was the right thing to do).

Wages of the “Intels”

Recently I was quite critical of an article in the San Francisco Chronicle comparing the “Intels” (firms that hire H-1Bs directly) and “Infosyses” (firms that hire H-1Bs and “rent” them to other employers) regarding wages paid to their H-1B workers. Putting aside the ethical problems of the article, let’s look at the article’s main theme, which was that the Intels don’t underpay their H-1Bs, while the Infosyses do.

The Chronicle analyzed prevailing wage values in Labor Condition Applications (employer requests to hire H-1Bs). In my comments on the article, I noted that the prevailing wage, as legally defined, is actually well below the market wage that the given worker would command based on her qualifications, so paying above the prevailing wage does not imply that the employer is paying at market rates. The Intels do indeed underpay their H-1Bs, and I referred interested readers to my Migration Letters paper for detailed analyses.

In this post, I will make that point much more simply. A number of critics of the H-1B program base their analyses on the four experience levels the law sets for prevailing wage. Keep in mind that the law defines Level III as the overall average wage for a given occupation and region

The critics note that the Infosyses tend to hire at Levels I and II, i.e. below average. Since those same critics don’t mention the Intels, you would conclude that those firms are using H-1B responsibly, right? But that conclusion would be wrong. In this post, I will show that the Intels are also paying mostly at Levels I and II, i.e. below-average rates.

I am using the 2016 PERM data, which is for employer-sponsored green cards. This data is more reliable, because each record corresponds to an actual worker, while the LCAs are simply applications to hire a worker, unspecified, at some future date. However, if you prefer, you can download the LCA data and do a similar analysis. I restricted my analysis to software developers.

I found that 66% of Intel’s green card sponsorees were being paid at Levels I and II, i.e. below average for the given occupation and region. For Google, the figure was 96%. In the case of Facebook, it was 91%. I will include my code at the bottom of this post, so you can try some other firms if you are interested. But even with these few data points, you can see that the Intels are actually similar to the Infosyses in terms of paying below-average salaries.

Mind you, the Intels do pay more than the Infosyses. The Intels tend to hire people with U.S. Master’s degrees while the Infosyses hire workers with Indian Bachelor’s degrees. This in fact is why there are so many at Level II for the Intels. But Level II is still below average.

The H-1B issue is complex, as you can see. Indeed, some of you may be asking at this point, “Isn’t prevailing wage defined as the average salary?” The answer is that it is defined as the average salary for the given occupation, region and experience level, as opposed to just the average salary for the given occupation and region. In other words:

We are back to my favorite theme in the H-1B debate: Age. Younger workers are cheaper, and employers hire young H-1Bs in lieu of older (35+) Americans. The four-tier experience system in the legal definition of prevailing wage amounts to government-sponsored age discrimination, which is the core problem with H-1B.

In fact, the four-tier system was enacted in 2004 at the behest of the tech industry. It replaced the old two-tier system, with the new Level I (out of four) of course being lower than the old Level I (out of two). Keep that in mind whenever you hear an industry spokesperson or a politician say that H-1B wasn’t intended for cheap labor. Obviously that indeed was and is the intent.

Below is the promised code, in R. The PERM data comes in a .xlsx file, which I converted to .csv using xlsx2csv, a Python utility available on the Web. (I don’t have a Windows machine, thus no Excel etc., and the R Excel-reading packages failed on this data.) You’ll need the record layout and the SOC occupation codes. You can do analyses of the wage levels as I did above, or analyze degree levels, academic majors, nationality and so on. Enjoy!


p16 <- read.csv('perm2016.csv',header=TRUE)
pr <- p16[,25]
p16prog <- p16[pr=='15-1131' | pr=='15-1132' | pr=='15-1133',]
intel <- p16prog[p16prog[,9] == 'INTEL CORPORATION',]
table(intel[,27])

Today’s March for Science

Today’s national March for Science brought perhaps 200 protesters to rally and then parade through the downtown in my city, Walnut Creek in the East San Francisco Bay Area. I am not unsympathetic, but I got the impression that many of the speakers and marchers were insincere and naive.

These seemed to me to be grownup versions of students I had in the years when I was a Statistics professor — liberal arts and social science majors who resented having to take some STEM for the university’s General Education requirements. To suddenly defend the importance of science seems a bit disingenuous, a thinly-veiled excuse for attacking Pres. Trump. There is much on which the president might be criticized, but why not do it openly, instead of engaging in hypocrisy?

Worse, though, is their naivete, revealed in their treatment of science as hard and fast, unshakable, undeniable truth. A number of signs read, “Science Is Real Facts, Not Alternative Facts.” On the contrary, science currently is in a state that many consider a crisis, in which many “facts” are questionable. In the last couple of years, the confidence scientists themselves feel in their fields has been badly shaken, with a new term coming out — reproducibility.

The problem is simple: Much published research, even in the most prestigious journals, simply isn’t replicated when other researchers give it a try. When Scientist B tries to re-do the experiment conducted by Scientist A, it often turns out that B gets different results alternative facts, if you will.

The reasons for this unsettling state of affairs are complex. Yes, sometimes there is outright fraud, but more commonly the causes are more subtle: Hidden variations from one lab to the next; unconscious differences in assumptions from one researcher to the next; lack of understanding of statistical methodology; the tendency for authors and journals to report only “significant” findings; and so on. The old Keynes joke about economists, “You could lay all the economists of the world from end to end, and they wouldn’t reach a conclusion,” turns out to apply to science as well.

This is not news at all to the scientists themselves. It’s just that now people are openly talking about it, as the above link to Nature, one of the most prestigious journals in the world, shows so well. If you are the type who enjoys car crashes and such, plug “reproducibility crisis” into Google. You will be stunned to see how urgent the matter has become.

None of the above is meant to be a comment on the climate change controversy. I have not read enough of the research to have a point of view, a little obstacle that doesn’t stop many in the media and politics from speaking out. Nor is it a statement on Trump’s science policies. It’s too early for any fair person to have a strong opinion on the latter anyway. But for those marching today who took those college science classes for a Pass/Not Pass grade and put in minimal time studying, it’s not too late to learn some science and start using the Scientific Method, rather than blind hatred for the man half of Americans chose as our president.

The President’s Executive Order

Today President Trump issued his long-awaited Buy American, Hire American executive order. A number of people have asked me what this means for the H-1B work visa and related programs such as Optional Practical Training (OPT). Let’s take the latter first.

As many of you know, OPT is an extension of the F-1 student visa. Though it was intended to give foreign students a chance to work in one-year internships after earning their American degrees, it became an unofficial supplement to H-1B. Presidents George W. Bush and Barack Obama both extended it much beyond one year, and it now serves in essence as a backdoor way to expand the yearly cap on new H-1B visas. There is no cap on OPT.

So OPT is a major issue. However, it is not mentioned in the executive order. Why not? Once again, this is an “Intels Good, Infosyses Bad” issue. As always, by “Infosyses” I mean the outsourcing firms that “rent” H-1B programmers to U.S. firms, with the “Intels” meaning the companies that hire H-1Bs directly. I strongly disagree with this view, which has been vigorously promoted by the Intels, basically a scapegoating tactic to deflect attention away from themselves.

What is that related to OPT? The answer is that it involves foreign students, the group favored by the “Intels,” and Trump long ago (August 2015) announced an Intels Good, Infosyses Bad policy, and he has been consistent on it ever since (contrary to the “flip-flopping” claim made by the Washington Post and many others). Remember, one of Trump’s strongest and closest supporters has been Silicon Valley’s Peter Thiel, who presumably talked up Intels Good, Infosyses Bad with Trump early on.

In other words, no surprise that OPT wasn’t in the executive order. But there is another part of the executive order, much subtler effect Intels Good, Infosyses Bad:

(b) In order to promote the proper functioning of the H-1B visa program, the Secretary of State, the Attorney General, the Secretary of Labor, and the Secretary of Homeland Security shall, as soon as practicable, suggest reforms to help ensure that H-1B visas are awarded to the most-skilled or highest-paid petition beneficiaries.

(Emphasis added.) Note the “or”! What is this?

For years, various individuals and organizations have proposed doling out the visas in the order of offered salary. This presumably would reduce usage of H-1B for cheap labor, and it has “market based” quality to it: A worker who is really highly paid must be worth a lot to his/her employer, and thus ostensibly to the national economy. I support this idea, but only in its pure form, and have warned that a weakened version may be worse than no reform at all.

A few weeks ago, I met with a prominent partner of a major national immigration law firm, at this man’s request, in preparation, he said, for a meeting with the Trump people. I asked him about the proposal to issue visas in order of offered salary. He was quite strongly against it. I was surprised, but I shouldn’t have been. The Intels do pay some high salaries to foreign engineers (though note the comment later in this post), but they also hire lots  of other foreign STEM workers at quite modest salaries. These workers do tend to have Master’s degrees, and sure enough, press reports today stated that the ranking of visas could be made on the basis of giving priority to Master’s people rather than just to those in the upper pay echelons. In the phrase “most-skilled or highest-paid” in the executive order, “most-skilled” likely refers to Master’s/PhD holders.

In other words: All those companies cited by proponents of Intels Good, Infosyses Bad, such as Disney, SCE and so on, would hire the foreign students with Master’s degrees. They won’t have CS degrees from MIT, but will have Master’s in Information Science from Cal State Long Beach, say, and will be much cheaper than the Americans. I did say “hire,” by the way; even if outright replacement of Americans were banned as part of the deal, the employers would just wait for attrition, hiring the foreign students one at a time. In terms of impact, it would be very similar to Staple a Green Card. These employers won’t save quite as much money as they did by renting from the Infosyses, but it will still be a sweet deal.

And this is the part that even many critics of H-1B don’t understand. They see that the Intels pay their H-1Bs more than the Infosyses do, and they thus accept the Intels Good, Infosyses Bad Koolaid. As I have pointed out many times, this is highly deceiving. Both the Intels and the Infosyses are using the H-1B program for cheap labor. The Intels do hire a higher class of worker, typically one with a Master’s degree in CS or EE, but the Intels are doing so on a cut-rate level. It’s like going to a Toyota dealer, and having a choice of 25% off invoice for either a Corolla or a Camry; the Camry is more expensive, but you are still getting a bargain for a Camry-class car.

“Nature abhors a vacuum,” and if there are holes in a statute or in the regs, the employer will rush in just like air rushes into the a temporary vacuum. Result: American tech workers, especially the ones over age 35, still lose out.

So, I have been hoping that the Trump administration would look beyond Intels Good, Infosyses Bad in forming policy. Today’s announcement was disappointing and unsurprising, but “hope springs eternal.”

 

Horrific Case Highlights Hidden Policy

Too many news items, too little time. For instance, I’d love to explain why the headline, “After a series of flip-flops, Trump prepares to deliver on a key campaign pledge” in the Washington Post is absolutely false on the flip-flops claim and why I am only cautiously optimistic about Trump’s announcement, but I just don’t have the time now. Yet I could not postpone comment on this incident, called to my attention by a reader.

This was a case of domestic violence, actually continuing abuse, by a tech entrepreneur in Silicon Valley. I must warn you that the article, in presenting the incidents in great detail, is quite painful to read. I must also state at the outset what I am NOT saying here:

  • I am NOT extrapolating this case to Indians in general, even Indian immigrants in general, even Indian tech immigrants in general. In spite of the putative sexism in Indian and Chinese cultures, I have not observed anything in the tech field along those lines (relative to U.S. mainstream culture).
  • I am NOT presenting this as a reason for cutting down on the H-1B work visa. Though I haven’t run the numbers, I am pretty sure that claims that the H-1B program exacerbates the gender imbalance in Silicon Valley are false, and that in fact just the opposite is true.

Instead, my point here is on one particular aspect of this news story:

The prosecutor in the case, Assistant District Attorney Steve Fein, described the plea deal to The Daily Beast as a fair outcome, noting that accessory after the fact is also a felony, though not a violent one that would place Gattani at risk of being deported back to his native India. Fein indicated that his boss, Santa Clara District Attorney Jeff Rosen, seeks to avoid such deportations.

In other words, immigrants, especially tech immigrants, have become so exalted in our society that the Santa Clara County DA is loathe to do anything that might result in deportation of a cruel, sadistic man who regularly beat his wife — not just once, but on a shockingly regular basis. This is a man who even struck his wife while she was nursing their baby. But oh no, he’s an immigrant, so we must protect him, according to the DA.

Maybe the Trump administration should put Santa Clara County at the top of its list if it defunds sanctuary cities and counties.

Note, in response to many queries: The woman states that she was born in India but is a U.S. citizen. The man is obviously NOT a citizen; otherwise he would not be deportable. It is likely that (a) she originally got her green card as a minor, through family immigration, and (b) her husband married her to facilitate HIS acquiring a green card.

 

Washington Post Editorial Gets It Wrong Every Which Way

Following the lead of the New York Times, the Washington Post has now adopted the Intels Good, Infosyses Bad stance: They say Indian rent-a-programmer firms like Infosys abuse the H-1B work visa, while the mainstream firms like Intel — in the case of the Jeff Bezos-owned Post, firms like Amazon — use the program responsibly. But not only do both the Intels and Infosyses abuse the system, but the Post has its other facts all wrong as well.

The de facto indentured servitude referred to in the editorial actually occurs with the Intels, not the Infosyses. The editorial board is drawing upon a piece published last week by their writer Tracey Jan, who misunderstood one of the people she interviewed, Amit Kapoor. He was referring to H-1B workers who are simultaneously being sponsored for green cards, which the Intels generally do, but which the Infosyses rarely do.

In other words, the Post is unwittingly showing that in actuality it’s Intels Bad, Infosyses Bad (though for different reasons).

The Post is also incorrect about that now-famous $60,000 figure, which the paper says allows the Infosyses to pay below prevailing wage. Wrong, wrong, wrong. Every employer of H-1Bs must pay the prevailing wage. The prevailing wage itself is set too low, but the $60K figure has no bearing on this.

The Post says, “As a candidate, Donald Trump talked out of both sides of his mouth” about H-1B. Not true — unfortunately. Starting with his first pronouncements on H-1B in August 2015 (not 2016), Trump has consistently taken an Intels Good, Infosyses Bad stance. I don’t like it, but he has been entirely consistent.

The Post writes,”…there is no doubt that U.S. colleges and universities cannot keep up with the demand for graduates, especially with advanced and highly specialized degrees.” Where are the Post fact checkers when we need them?