Inviting Our Own Problems

Date: Thursday, May 31, 2007 2:20 AM

<<<<< JOB DESTRUCTION NEWSLETTER No. 1700 -- 5/30/2007 >>>>>

I recently did an interview for the "New American" magazine. The article below
has the complete text minus some pictures of yours truly that are in the print
edition.

The "New American" magazine is a great source of information on subjects such
as globalism, immigration, free trade agreements, WTO, United Nations, and the
North American Union. In many cases it's the ONLY place to get in-depth
information about these subjects. To get a listing of their articles go to
this link, and hover your mouse over "What we Do", then "The New American" and
then click "topical index".

http://www.thenewamerican.com/

You can request a sample issue by going to the website, hover on "Who We Are",
click on "contact us", and then click on "request sample issue".

+++++++++++++++++++++++++++++++++++++++++++++++++++

The New American, May 28, 2007, Volume 23, No. 11

http://www.jbs.org/node/3943

Inviting Our Own Problems

By Kurt Hyde (Interview)
Created 2007-05-28 05:00
Interview of Robert Sanchez by Kurt Hyde

Americans have regularly been forced by their employers to train the
foreigners who would be taking over their jobs.

Fox News reported on a particularly tragic example of job displacement that
took place in 2003: "Kevin Flanagan, a computer programmer with Bank of
America, was fired from his job after being forced to train his replacement,
an Indian worker who was taking over Flanagan s job as part of Bank of
America s effort to replace its American workforce with foreign labor.
Flanagan walked outside into his office parking lot and shot himself to
death."

The Fox News account continued: "Even a 2002 report by the undersecretary for
technology at the Department of Commerce, which found that several years of
data did not support the IT industry lobbyists claim of a critical worker
shortage, could not stop Congress from issuing another
684,189 H-1B and L-1 [temporary-work] visas that year."

Mr. Robert Sanchez is a critic of employment-based visas because foreign
workers are displacing American workers. Mr. Sanchez is a computer engineer
who was displaced from his job by a company-sponsored H-1B program. He now
publishes a free online newsletter entitled The Job Destruction Newsletter,
which he produces, edits, and e-mails regularly, usually daily.

THE NEW AMERICAN: Mr. Sanchez, many Americans are undoubtedly unfamiliar with
temporary-worker visa programs with nondescript names such as H-1B and L-1.
What are H-1B and L-1 visas and why should we be concerned?

Mr. Robert Sanchez: The H visa program was started in 1952 to allow employers
to import non-skilled workers into the United States. Most people would be
very surprised to know that H-1B was modeled after the H visa that allowed
ranchers to import Basque sheepherders. H visas were used mostly for unskilled
laborers until the passage of the 1976 Eilberg Amendment which allowed
universities to declare perpetual shortages of professors.
H-1B was passed in 1990 and allowed for the importation of a broad range of
white-collar workers such as engineers, scientists, programmers, nurses,
physicians, pharmacists, actuaries, and even fashion models. H-1B and L-1
visas were codified into international trade laws in 1994 when the United
States agreed to the movement of "natural persons" under the General Agreement
on Trade and Services (GATS).

The L-1 visa program began in 1970 to allow for intercompany transfers of
business managers, executives, and other types of workers of transnational
companies. It was intended to be used mostly for short-duration trips between
a company s international offices, subsidiaries, and affiliates.
More recently it has been used in much the same way as H-1B to transfer
temporary workers to the United States. Potentially the L-1 visa is more
damaging than H-1B because it s unlimited in scope and has far weaker
protections than the feeble ones in the H-1B program.

My major concern is the continued degradation to our technology infrastructure
as we displace American workers by the rampant use of foreign workers both
here and abroad. Technological nations cannot function when the expertise
gained by work experience is held by foreigners.

TNA: How big a problem is the H-1B program? How many H-1B visas are granted
each year?

Sanchez: This is a very complicated question because government statistics are
incomplete and unreliable. There are numerous ways to get an H-1B visa
petition granted. It can be for a new employee or a renewal of an H-1B visa
for existing employment, and there are exemptions to the visa-allowance cap.

When people use the word "cap," they usually refer to the limit on the number
of visas for new employment. Let s take for example fiscal year 2004. That s
the most recent year reported in the U.S. Department of Homeland Security s
publication Characteristics of Specialty Occupation Workers (H-1B) for 2004,
which was issued this past November. In fiscal year 2004, there were 130,497
H-1B visas approved for initial employment, which is approximately double the
official cap of 65,000.

That same report listed 156,921 H-1B visas that were approved for continuing
employment in fiscal year 2004. Continuing-employment H-1B visas can be used
to extend the work period for an employee, to change the conditions of
employment, or to get the employee concurrent employment status with another
employer.

The report also states that there is some double counting within those
statistics as some individuals have more than one H-1B petition filed on their
behalf during the year. The bottom line is that in fiscal year 2004, which had
an official cap of 65,000 H-1B petitions for initial employment, there were
287,418 H-1B visas of all kinds approved.

My estimate is that we have about 850,000 H-1Bs currently working in the
United States and about the same number of L-1s. I have tried to get an
official count of these by inquiring with various government agencies, and
they have all answered that they don t have these numbers and know of no
government agencies that compile these numbers.

TNA: The Information Technology Association of America (ITAA) and hi-tech
companies such as Microsoft, Hewlett-Packard, Dell, etc. continue to swear
that there is a desperate labor shortage in the information-technology field,
so we must import workers. What evidence can you cite to refute those claims?

Sanchez: Their claims of labor shortages are pure fantasy. Wages for high-tech
workers have declined for the last several years when inflation is taken into
account, and job creation is actually less than the number of H-1B and college
graduates that are entering the job market. Perhaps there are some spot
shortages, but overall the industry as a whole has negative job growth, not a
shortage.

TNA: Typically, how much less is a foreigner paid for the same job that an
American was once paid to do?

Sanchez: Lou Dobbs has recently estimated this at about $12,000, which is
close to my personal estimate of $13,000 per year.

TNA: According to the U.S. Department of Homeland Security s publication
Characteristics of Specialty Occupation Workers (H-1B) for 2004, the median
annual compensation for H-1B holders in computer-related occupations was
$58,000 per year, with the 25th and 75th percentile groups making $47,000 and
$72,000 per year respectively. Aren t there significant numbers of well-
qualified Americans who would be willing to work for those wages?

Sanchez: Absolutely.

TNA: Another claim of the H-1B advocates is that American students do not have
the interest or qualifications to study computer science. How would you
respond?

Sanchez: Any declines in interest in Americans for studying computer science
in college are more a reflection on the decline of employment prospects for
them after graduation than in their interest or qualifications.

TNA: What percentage of college IT graduates get jobs in their field upon
graduation?

Sanchez: Unfortunately nobody knows the exact numbers because the universities
don t publish those statistics. The estimates change according to the
interests of the think tank making the estimate. There are many of us who want
the universities to make that information available to the public. Don t hold
your breath waiting for that to happen.

TNA: What happens to the American workers who are displaced? Have they been
able to find jobs elsewhere?

Sanchez: Some of them are fortunate and find other jobs in their chosen
profession, some of them change careers, and some lose not only their jobs,
but lose their homes and their livelihoods. The result is usually a downward
spiral in terms of the standard of living for the American middle class.

TNA: But aren t we better off importing foreign workers into America as
opposed to exporting our hi-tech firms?

Sanchez: This argument is a classic false choice called a Morton s Fork.
Big business threatens to move operations offshore if they cannot get an
endless supply of H-1B visas. The truth of the matter is that H-1B visas
facilitate outsourcing!

Insiders in industry openly discuss how H-1B is necessary to complete a
"knowledge transfer." Outsourcing technology from the United States is made
far easier when companies can bring foreign workers into the United States to
get valuable experience and training before using them in outsourcing.
One of the best ways to combat the loss of American jobs via outsourcing is to
stop visa programs such as H-1B and L-1.

TNA: What was your reaction when Senator John McCain said we needed to import
foreign workers for agricultural employment because American workers wouldn t
do that kind of work even if it paid $50 per hour?

Sanchez: ProjectUSA began collecting risumis from unemployed Americans who d
be willing to apply for those jobs. I let all my subscribers know about it and
encouraged those who d be willing to apply to send their risumis to
ProjectUSA. ProjectUSA gave the list of people to McCain, but he refused to
respond.

TNA: Thus far we have discussed only H-1B and L-1. Could you tell us a little
about the other temporary-worker visa programs? How many programs are there,
and have they also been harmful to our economy?

Sanchez: The last time I counted, I believe there were 16, but it s even more
complicated than that when one includes the subcategories under the main
programs. It s like alphabet soup. The programs that have been the most
destructive to the careers and incomes of American workers include H-1B, H-2B,
L-1, and TN.

TNA: After observing how the H program started as something small and
seemingly harmless, do you see the TN (Trade NAFTA) visas becoming as serious
a problem as the H-1B?

Sanchez: Yes, I do. I sometimes call the TN visa a time bomb because it
mandated that visas from Mexico would become unlimited 10 years after passage
of NAFTA. Guess what? That time has already come -- as of 2004, Mexico can
send unlimited numbers of skilled professionals to the United States.

TNA: Doesn t the law specify that temporary-work visas are only supposed to be
granted in those cases where Americans are not available to do the same jobs?

Sanchez: This is another one of those widely held myths. Except under rare
circumstances, employers are under no obligation to give preference for
American workers when hiring temporary guest workers. They are required to do
a "labor certification" for employment-based green cards. And H-1B regulations
say that employers must make a "good faith" effort to hire American citizens.
The problem is that a "good faith" effort can be nothing more than an empty
gesture. I have yet to hear of a company that was ever prosecuted for hiring a
foreign worker when a qualified American was available.

TNA: Typically, how serious a gap is there between the skills a foreign worker
brings to the job compared to that of the American he s replacing?

Sanchez: Some critics of H-1B argue that many of the foreign workers have
inferior qualifications, but I think that argument is a red herring. When a
displaced American finds himself underemployed stocking shelves or flipping
burgers instead of being employed in a professional work environment, the
foreign worker is getting the benefits of experience and training.
Eventually there will come a day when the foreign worker will actually be more
qualified. I worry about the day when these Americans will be turned down for
professional jobs because they really don t have the required skills.

TNA: Has the introduction of foreign workers into our high-tech industry
through H-1B created any national security problems?

Sanchez: Congress has been warned many times that H-1B and L-1 visas are a
conduit for spying and espionage, but nobody in a position of authority
appears to be listening. That s amazing considering the large number of
documented cases where foreign nationals have been arrested for spying while
in the United States on visas. Recent spy cases include foreign nationals from
China, India, Pakistan, and other countries.

TNA: How prevalent is the problem of illegal overstays by H-1B workers?
What can be done about it?

Sanchez: No one knows for certain how many H-1B overstays there are because
the federal government doesn t track when H-1Bs leave the country. One way to
force employers to comply with the law would be for them to be required to
post cash bonds for the H-1B visas they obtain for individuals.
The bond money wouldn t be refunded until the company shows documentation to
prove that the H-1B departed from the United States.

TNA: It appears that the Department of Labor and INS have been simply ignoring
these pervasive violations. In 2002, after the 9/11 attacks, an Inspector
General s report noted that "the INS has made little progress in addressing
the important issue of nonimmigrant overstays since we issued our 1997
report." Have you seen any evidence of progress since that 2002 report?

Sanchez: No. I ve not seen any progress at all.

TNA: Many of the apologists for these employment-based visa programs cite
compassion for foreigners as the reason for their advocacy. In your
experiences, how much compassion have you observed for the American computer
professionals who have lost their jobs, medical benefits, homes, etc?

Sanchez: There is a conspicuous absence of compassion in the media, our
politicians, and the general public.

TNA: Although H-1B would present serious enough problems even if employers and
workers adhered scrupulously to every letter of the law, is it not a fact that
there is widespread abuse and violation of the program?

Sanchez: Like all government programs, H-1B has its share of fraud, but it s
not as widespread as popularly believed. Employers don t need to defraud the
system since the law already provides ample loopholes. Don t ever let someone
fool you into thinking that the way to solve problems with H-1B is to enforce
regulations. The problem is not one of compliance as much as loopholes and
global-labor arbitrage.

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