Correcting the Corrector

Prominent libertarian writer Stephen Moore recently wrote an op-ed lavishing praise on the H-1B work visa program, “…arguably the most successful [immigration program] for the U.S. economy has been the H-1B program.” A strong statement even for a libertarian, reminiscent of physicist Michio Kaku’s calling H-1B “our secret weapon” for US world economic leadership. Now  LA Times writer Mike Hiltzik is taking Moore to task for “parading his ignorance” on H-1B, a program Hiltzik calls “a cynical sham.” No voices of moderation among Messrs. Moore, Kaku and Hiltzik!

Sadly, though, Hiltzik too has his facts wrong. His statement,

…visa holders can work in the U.S. for three years, with the goal of obtaining permanent residency and, ultimately, citizenship.

is way, way off base, not even on the ball field. H-1B is a temporary work visa, good for three years and renewable for another three. It is separate from the employer-sponsored green card program. It is common for a sponsor of an H-1B to also sponsor the worker for a green card, but they are separate programs, and sponsorship for one does not imply sponsorship for the other. And, note that even if there is an application for a green card, this comes from the employer, not the worker.

This is not splitting hairs. In the green card case, the worker is in essence tied to the employer, whereas if the worker is just an H-1B, she has much more mobility and thus less chance to be abused.

Moore said, “There is little evidence that these foreign workers displace Americans from their jobs,” to which Hiltzik retorts that on the contrary, there have been some celebrated cases (Disney, SCE etc.). Yes, but Moore’s general statement is correct; in fact there is widespread displacement (direct and indirect), but hard evidence is limited.

Hiltzik says the NFAP study finding a big jobs multiplier effect from hiring H-1Bs was invalid because it wrongly attributed cause-and-effect, when actually  “tech companies were adding jobs at the same time they were hiring H-1B workers,” i.e. both stemmed from a boom tech economy. Fine, but Madeleine Zavodny’s study showing each H-1B hire produces 2.62 jobs used more sophisticated statistical methods, which she claimed did show cause-and-effect. Her study had tons of other problems, but still Hiltzik has not done his homework. (He’s written a number of articles on H-1B over the years.)

Of course, regular readers of this blog will immediately spot my biggest objection to his column, the “Intels Good, Infosyses Bad” syndrome, a view under which the Indian outsourcing firms are the main abusers of H-1B, an incorrect and dangerous view. Granted, he doesn’t let the Intels off the hook completely, but mostly so (“The H-1B program continues to be an outsourcer’s dream”). To me, that error tops any of Moore’s.

19 thoughts on “Correcting the Corrector

  1. Two points,
    – The vast majority come for the purpose of obtaining legal permanent residence and eventual citizenship. They may be separate legal processes, but to ignore the intent of those here as H1Bs, along with industry’s using potential for green card, as a carrot, is disingenuous. It’s not unusual for a company to string OPT, then H1B, then late as possible employment based green card application, for years and years of indenture. Much fuss is made over the green card “backlog”, because it makes the green card carrot much less of a selling point, and clogs up their H1B throughput.
    – As for “job multiplier”, I note in all mentions of this, what they aren’t saying is they’re in all likelihood public sector jobs for addressing immigration needs (ESL teachers, etc) and the supplanted citizenry, with unemployment office workers, etc. ALWAYS, ALWAYS, I’ve noticed none of the “create jobs” claims address what are the jobs and were that are being created, in hopes the public PRESUMES the jobs created are at the company. That was also an ambiguous claim in Amazon’s “give us full measure of tax breaks for ‘creating 50K jobs’ in your city” solicitation of proposals – where citizens would get tax shortfall and extra expense for public sector employment of some of those “50K jobs” created..

    Like

  2. There is only ONE way to properly use a multiplier — you must compare the “H1-B” multiplier with a “U.S. Citizen” multiplier. And, both multipliers must take into account whether the new job(s) created is/are low-wage burger flipper jobs (for example, to support H1-B’s working 80 hours a week with no time to eat at home), or well-paid construction jobs (for example, to support U.S. citizens who will buy homes since they don’t worry about getting deported).

    Like

  3. Good point that public sector “jobs created” shouldn’t count in the same way. 15.3 percent of all employment is public sector, but is true that immigrants might create higher proportion of public sector employment. Say it’s 25% for immigrants, then a 2.0 jobs created would become 1.5 private sector jobs.

    Like

  4. These discussions seem to get caught in the weeds. Since when were American universities, colleges, and trade schools unable to produce American programmers of equal or better quality?

    Dr. Matloff has even written (I believe) that women shy away from the programming profession due to the up and down job market.

    Anecdotally, a friend, an IT manager in the south bay for a large company, says he only gets foreign applicants. (I believe Dr. Matloff says HR is screening the applicants.)

    Discriminatory hiring seems rampant. In around 2000 I visited a south bay tech company, and the whole substantial floor appeared to be Sikhs (?). (Every single male had a headwear on; I didn’t ask.) There was not a SINGLE European-, African-, Latino-, Japanese-, or Chinese-American! Not one. A former employer of mine hires 100% H1B immigrant Chinese; they are also hiring H1B visa workers for marketing positions!

    An aside, I ran into a small tech owner who said the average salary for a programmer in San Francisco is $160,000 a year!?

    Like

    • Saw same thing at last two firms in Sacramento, CA metro area. At first, 3 of 4 DBAs were Indian males – the fourth was white male. Second firm, all nine DBAs were Indian males. No blacks, Hispanics, East Asians, Native Americans, women or LGBT. Still waiting for the discrimination lawsuits.

      Quite different where I’m at now but demographics are also quite different here.

      Like

    • I commented on the Indians only hiring Indians and Chinese doing the same a few years ago and got a thrashing on liberal sites. Good to see it is now possible to comment on some truths. The unspoken truths are that the quality of the work coming out of these companies is extremely poor.

      More truths, when I started programming in the 1980’s, women were at least half the workforce. We were forced out by bad working conditions and bad pay.

      Like

  5. amyinnh is totally correct. The vast majority of H1-B workers who arrived prior to 2008 are still here. It is quite obvious that they used the H1-B as a “foot in the door”, and intended to stay.
    The only reason why those who arrived after 2008 have (in many cases) returned to their home country is that there has been a general rejection of the Cheap Slave Labor model of immigration. At least, there has been a general rejection of this by the American Citizens Who Vote.

    As for “job multiplier”, you can be sure that the H1-B advocates will tell any lie which seems to work.

    Like

  6. > Fine, but Madeleine Zavodny’s study showing each H-1B hire produces 2.62 jobs used more sophisticated statistical methods, which she claimed did show cause-and-effect.

    Actually, Zavodny’s finding of the 2.62 jobs created uses OLS regression which is much less sophisticated. She verified this in an email, saying the following:

    > Yes, the 262 number is based on an OLS regression, not a 2SLS regression. It was difficult to find an instrument with enough power to identify the 2SLS regressions, particularly for the advanced degree STEM workers (the effective sample sizes get smaller when moving from all BA+ immigrants to MA+ immigrants to MA+ immigrants working in STEM; the collapsed sample size in the regressions of course remains the 50 states + DC for the years 2000-2007 or 2000-2007 but the underlying sample from which the data were collapsed is smaller and hence noisier). I therefore prefer to not use strong causal language when interpreting the results.

    Still, the paper did “dance around” the issue of cause-and-effect. As explained at http://econdataus.com/amjobs1.htm#section17 , the paper began by saying that the increase in certain foreign workers “is associated with” an increase in certain native jobs. By the end of the paper, however, it is swaggering about saying things like “100 FOREIGN BORN WORKERS = 262 ADDITIONAL JOBS”. It may be that Zavodny did not originate these direct claims of cause-and-effect but her name is on the paper so she does have responsibility for its contents.

    Like

  7. Spot on Norm again, I had already researched on this article and have found the example given by Moore in this op-ed “Rad Cyrus” works as a Business Analyst for Amazon, is from Iran and probably 34 years old and without any education in the US. Since your previous post was about ageism, I’m raising this point here. One more thing to note here about the headlines that Chinese national made who couldn’t get a visa and had to return “Leo Wang” is also 33 years old, worked as program manager for Seagate. The billionaire owned companies will hire foreigners, but not a 45 or 50 year old American who can very well do such analytical jobs and may only need on-the-job training.

    Like

  8. “…visa holders can work in the U.S. for three years, with the goal of obtaining permanent residency and, ultimately, citizenship.”

    Not sure why you’re trying to imply that Hiltzik is incorrect with this statement. The primary purpose for any Indian seeking an H-1B visa is to find a way to permanently immigrate into the United States. If that weren’t the case, I wonder why there are over 600,000 Indians in the EB Green Card queue. There is nothing that Hiltzik said that was incorrect about this assessment. Sure, he left the part out that the H-1B can be renewed for another 3 years. But regardless, the intent of wanting permanent residency is absolutely correct. I am thankful that a mainstream journalist is writing in favor of American workers and exposing the fraud that the H-1B visa program is.

    Like

      • Not how I read it. The H-1B quickly became for workers what the K-1 is for fiancé(e)s. A fix to make entry into the US faster possible – as the Green Card procedure takes from 1-2 to several years.
        The H-1B visa is Dual Intent. Many workers now taking an H-1B offer only do this IF a Green Card procedure is guaranteed by the employer.

        Like

        • Many H-1Bs do indeed get sponsored for a green card (whether immediately or after a few years) by their employers. The details are available in my various articles and papers. But one does not necessarily imply the other.

          Like

          • 1. It is financially almost impossible to come to the U.S., work a few years as an H-1B, then move back to where you came from.
            2. No employer can wait 2-3 years for a needed worker, especially not in tech projects.
            For these reasons the H-1B is seen as a temporary solution and the G.C. is seen as implied.

            If you want people to work for a short period, then leave, pay them 2-3 times the prevailing wage !
            These workers should also – if they indeed leave – be exempt from Soc. Sec./Medicare taxes and 401-k withdrawal penalties.

            Like

  9. The only forms of immigration that should be allowed are EB1-A (extraordinary ability) and EB5 (investment, but with significantly increased amounts that are adjusted yearly for inflation). Each and every other form is detrimental to society as it stands today.

    All work, student and exchange visa programs must be permanently canceled. If you want to meet the criteria for EB1-A or EB5, do it *without* using American resources.

    Like

  10. I’m glad Moore withdraw from the Federal Reserve seat nomination. I put him in the same class as Larry Summers, arm chair economists, liberals at heart. I never fell for Moore’s support of Trump, I saw it as pure opportunism. Luckily, he is no longer in the running. Now if Trump would only get rid of Larry Kudlow maybe something would finally be done to improve the economy, before Kudlow implodes it.

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s