Date: Thu, 2 Feb 2012 00:26:56 -0800
From: Norm Matloff <matloff@cs.ucdavis.edu>
To: Norm Matloff <matloff@laura.cs.ucdavis.edu>
Subject: more on the Wedel case

To: H-1B/L-1/offshoring e-newsletter

Several articles have come out in the press in the aftermath of Mrs.
Wedel's online challenging President Obama over his claim that we have
an engineer shortage and need a liberalized H-1B program to remedy it.
An important piece of new information in them is that Mr. Wedel had been
laid off from Texas Instruments (TI)--a company that has been in the
forefront in lobbying Congress to expand the H-1B and green card
programs for many years.  Let's start with that point.

Back in 1998, when Congress was considering its first big H-1B increase,
I cited the example of a new grad, with a Bachelor's in physics from
Princeton, and a Master's in EE from Cornell, top grades in top schools,
who was rejected not just once but twice by TI.  There is always the
possibility that there are unknown factors in cases like this, but it
certainly didn't jibe with TI's claim to have a desperate shortage of
engineers.

The next year, Roger Coker, TI's director of staffing for the United
States, actually told US News and World Report in a rare moment of
candor that H-1B was a key component in TI's quest to hold down engineer
salaries.  I suppose there might be a charitable interpretation of that
too, but it surely seems to be part of a pattern of lack of sincerity by
TI on the H-1B issue.

Then in 2009 Vivek Wadhwa cited an example of a foreign hire TI had made
earlier--as a test engineer.  This worker had a Master's degree but was
working as...a test engineer!  Perfectly good job, but it is mundane
work, nothing innovative.  Surely TI could have found a U.S. citizen or
permanent resident for that job.  (Though not necessarily a young one,
which was probably what TI wasn't telling you.  More on this below.)  A
test engineer--come ON, TI, these are the foreign geniuses you say
you're hiring?

Then last October, TI testified to Congress that it couldn't find
engineers at the graduate-degree level.  Surprisingly, TI volunteered
the information that they had NO shortage at the Bachelor's level; the
only shortage, the TI rep noted, was at the graduate level.  The
American kids stop at a Bachelor's degree, she said, because they want
to go out in the world and make money.

That of course is not what Obama has been told.  He thinks we have a
shortage of electrical engineers, that firms like TI just doesn't have
any applicants, and that thus Mr. Wedel should be able to get a new job
"right away."  Obama recently called for adding 10,000 more engineers to
our workforce.  

The TI rep's statement is also at odds with her later statement in the
same hearing that TI has various programs at the K-12 level to get more
kids interested in engineering!  Why do that if there is no shortage?

And what about the TI claim that they do have a shortage at the grad
level?  First of all, if that's true, then why is TI conducting programs
at the K-12 level?  Shouldn't they start programs at the university
level, to coax those American engineering students to continue on to a
Master's?  (Not PhD.  As I've written before, although the industry
lobbyists say they need more H-1Bs because not enough Americans pursure
doctorates, most tech firms do NOT hire many PhDs.)  Why aren't they
doing this?  The TI rep listed a number of educational programs they're
engaged in at K-12, but nothing at the university level.

And TI's claim to need people with grad degrees seems bogus too, in
light of their hiring the abovementioned worker with a Master's in the
position of test engineer.

In short, TI's constant claims over the years to need to hire H-1Bs is
disingenuous.

Now, what about age?  As most of you know, the central point I've been
hammering away at for years regarding H-1B is AGE.  The H-1B program is
fundamentally about AGE.  When the industry runs out of young Americans
to hire, they hire young H-1Bs, and thus avoid hiring the older
Americans.  Younger workers are cheaper than older ones, hence H-1B
brings cost savings to the employers.

On that topic, consider the Wedel piece in ABC News, 

http://abcnews.go.com/blogs/politics/2012/02/are-americans-losing-high-skilled-jobs-to-foreigners/

It features the following quote of Vivek:

      “The No. 1 issue in the tech world is as people get older, they
      generally become more expensive,” said Vivek Wadhwa, an adviser to
      start-ups and an entrepreneurship scholar affiliated with Duke
      University. “So if you’re an employer who can hire a worker fresh
      out of college who is making $60,000 versus an older worker whose
      making $150,000, and the younger worker has skills that are
      fresher, who would you hire?”

So Vivek said what I've been saying, and what he has said before:  The
issue is AGE.  He and I do differ on the skills issue, which I regard as
a pretext.  See my various writings for details, but that's not the
point I want to make now.  Instead, let's modify Vivek's statement, in a
way I don't think he'd disagree with, to the following:

      So if you’re an employer who can hire a worker fresh out of
      college who is making $60,000 versus an older worker who's making
      $150,000, and BOTH the older and younger worker have the freshest
      skills, who would you hire?

This exposes the REAL problem, doesn't it?  The real problem is that
older workers are too expensive.  The skills issue is secondary, if not
an outright pretext (which I say it often is).  And this is why I said
in my last posting that retraining programs (a topic sure to arise if
Obama really were to figure out that Wedel is typical, not an exception)
are NOT the solution.  A retrained expensive old guy is STILL an
expensive old guy.

The bottom line is that Mr. Wedel, in his mid-30s (right at the point
where I've said "old age" sets in in the tech field), is a victim of
this revolving-door ruse that the H-1B program has devolved to over the
years.  Its predecessor, H-1, started as a means of hiring "the best and
the brightest," outstanding talents from around the world.  Now, H-1B is
a program for, in many cases, hiring ordinary people to do ordinary
work--but YOUNG ordinary people doing ordinary work.

And Obama is a victim too, in his own way.  The Democratic Party (as
with the Republicans too) has been pushing this theme for years, saving
our economy through tech innovation.  Obama came into this, and
apparently drank the Kool-aid.

Norm