Date: Mon, 12 May 2008 16:59:36 -0700 From: Norm Matloff To: Norm Matloff Subject: insider's assessment of probability of H-1B cap increase [Note: See update, http://heather.cs.ucdavis.edu/Archive/HeritageFound3.txt] To: H-1B/L-1/offshoring e-newsletter To most of you, the main import of the enclosed article is in the following excerpt: # That's because the Democratic leadership, including House Speaker Nancy # Pelosi, has given the Congressional Hispanic Caucus "veto power" over any # immigration-related bill that comes to the House floor, regardless of its # popularity, Fishman said at a panel discussion here hosted by the Heritage # Foundation, a conservative think tank that supports an increase in the H-1B # cap. # "The Hispanic Caucus sees it as a bargaining chip to get what they want, # which is comprehensive immigration reform, amnesty for illegal immigrants, # whatever you want to call it," Fishman said. "Until the Democratic # leadership allows legislation (related to H-1Bs) to go to the floor on its # own merits, that's the situation we have here." It's less interesting to me because: (a) Over the years I've heard such statements, "prospects for an H-1B increase look dim," many times, yet often an increase follows a few months later. I don't mean the speakers of such comments were insincere when they made them, but the fact is that the industry's clout is huge, and things do change--especially in election years. Expansion of the program was enacted in the presidential election years of 2000 and 2004, and in the congressional election year of 1998. You might think that election years are when the voters hold the most power, but it is in those years that the politicians are in most need of the industry's campaign money. (b) I had already heard this rumor about Pelosi, and find much more significance in the following excerpt (sorry for the length, but it's very important): # ...a representative from a group called the Federation for American # Immigration Reform, which supports more restrictive immigration # policies, asked why the panel had been stacked with pro-H1B advocates # and suggested every employer applying for the visas should be subject to # a full, on-site investigation to verify its authenticity. # # Although Smith's brief "emergency" H-1B bill doesn't propose new checks on # the system, Fishman said his boss is aware of concerns about their abuse and # wants to strike a balance. On the one hand, high-tech companies like # Microsoft and Google prize H-1B visas because they say those work permits # allow them to fill gaps in their operations for which there is a shortage of # qualified Americans. On the other hand, some American programmers say abuse # of the system has displaced American workers and depressed their wages. # # There's truth to both perspectives, Fishman said, adding that the Department # of Labor isn't as well-equipped to fight suspected fraud in the H-1B program # as it could be. Part of the reason, he said, is that the system is based on # "attestations" from employers that they're hiring employees with the proper # qualifications and at the requisite wage levels, and the Labor Department # "has to wait around for some to complain" before it opens an investigation, # Fishman said. # # "The H-1B program can and usually does operate to the benefit of both # American high-tech companies and American workers," he said. "It is the job # of Congress to ensure that it always does." The theme here is "Yes, there is some fraud in H-1B, and we need better enforcement." Careful readers of this e-newsletter know that this makes my blood boil, because it's the industry party line. The industry lobbyists love to steer the H-1B conversation in Congress to fraud, because they know fraud is rare; most employers are using the H-1B program for cheap labor, but they are doing so in full compliance with the law, due to huge loopholes in the law. That's why the industry is thrilled when the debate focuses on enforcement, as it distracts attention from the real issue, which is the loopholes. Indeed, when Computech was fined a couple of years ago for violating H-1B law, I predicted that the industry lobbyists would actually consider the incident to be helpful to them, rather than hurting their cause, because they could say, "See, we need better enforcement"; well, sure enough, that's what they did; see http://heather.cs.ucdavis.edu/Archive/PascrellJohnsonDebate.txt The fact that George Fishman is making these statements an indication of just where the politics of the situation are heading. To me, his comments on fraud have even more portent than his report of Pelosi's edict, with the message being that if expansion of the H-1B and green card programs is enacted, it will include "concessions" to American programmers and engineers that are only cosmetic--beefing up enforcement in various ways. I've known George for years, and he's a very decent guy. But I can't blame him, as one should not "shoot the messenger." He, after all, can only speak for his boss, Rep. Lamar Smith, who in turn must answer to his Republican party bosses if he wants to keep this committee chairmanship. I'm very disappointed in FAIR, of course, but they have their own people to keep happy in various ways. As to George's statement, # "The H-1B program can and usually does operate to the benefit of both # American high-tech companies and American workers," he said. "It is the job # of Congress to ensure that it always does" I've stated my position on that clearly and repeatedly over the years: The U.S. does benefit by bringing in "the best and the brightest" from around the world, but the vast majority of H-1Bs are not in that league. As shown in my recent CIS article, THIS INCLUDES THE BIG-NAME U.S. FIRMS THAT ARE PUSHING HARD FOR AN H-1B INCREASE--most of their H-1Bs are NOT "the best and the brightest." Note that James Sherk, one of the panelists mentioned in the article below, is the one who wrote a critique of my CIS article. I posted my comments on his analysis to my e-newsletter, which are archived at http://heather.cs.ucdavis.edu/Archive/HeritageFound.txt Odd that he didn't seem to make a "best and brightest" claim during the panel discussion; maybe it just didn't make its way into the article. Norm http://www.news.com/8301-10784_3-9941962-7.html CNet News.com May 12, 2008 12:12 PM PDT Dim outlook for H-1B changes in this Congress? Posted by Anne Broache Updated at 12:57 p.m. PDT to add the Democratic leadership's comments. WASHINGTON--The U.S. Congress won't be beefing up the number of H-1B visas anytime soon, the chief legal adviser to an influential Republican predicted Monday. Proposals to raise the annual H-1B cap would sail through Congress if called up for a floor vote, but political considerations mean that probably won't happen anytime soon, said George Fishman, chief counsel to the Republican side of a U.S. House of Representatives Judiciary Committee panel on immigration. That's because the Democratic leadership, including House Speaker Nancy Pelosi, has given the Congressional Hispanic Caucus "veto power" over any immigration-related bill that comes to the House floor, regardless of its popularity, Fishman said at a panel discussion here hosted by the Heritage Foundation, a conservative think tank that supports an increase in the H-1B cap. "The Hispanic Caucus sees it as a bargaining chip to get what they want, which is comprehensive immigration reform, amnesty for illegal immigrants, whatever you want to call it," Fishman said. "Until the Democratic leadership allows legislation (related to H-1Bs) to go to the floor on its own merits, that's the situation we have here." Fishman's boss, Rep. Lamar Smith (R-Texas), is the ranking member of the House Judiciary Committee and has proposed an "emergency" H-1B increase to 195,000 in 2008 and 2009--the highest level since its peak between 2001 and 2003. Still, increasing the cap is hardly a one-sided issue, with a number of Democrats--particularly those in districts with prominent high-tech companies--onboard as well. "Democrats are committed to working together toward balanced immigration reform, including H-1B visas, and we are continuing to hold hearings in order to move this issue forward," an aide to House Majority Leader Steny Hoyer told CNET News.com on Monday. H-1Bs are temporary work permits that allow foreigners with at least a bachelor's degree in their area of specialty to work in the United States for up to six years. Currently, the annual cap stands at 65,000, with an additional 20,000 for foreigners with advanced degrees from U.S. universities. This year, U.S. immigration officials reported receiving more than 163,000 petitions for next year's slots within the first five days and are no longer accepting new applications. Seated alongside Fishman at the Heritage event were two other H-1B proponents similarly pessimistic about changes occurring this year: Kelly Krieger Hunt, the U.S. Chamber of Commerce's senior manager for immigration policy, and James Sherk, a Heritage Foundation labor policy fellow. Sherk pointed to a study he and a colleague recently conducted, which estimated the United States will take in an extra $69 billion in tax revenue if 100,000 additional H-1B visaholders are allowed to work each year for the next eight years. But those positive depictions of H-1Bs are not without controversy. During the question-and-answer session, a representative from a group called the Federation for American Immigration Reform, which supports more restrictive immigration policies, asked why the panel had been stacked with pro-H1B advocates and suggested every employer applying for the visas should be subject to a full, on-site investigation to verify its authenticity. Although Smith's brief "emergency" H-1B bill doesn't propose new checks on the system, Fishman said his boss is aware of concerns about their abuse and wants to strike a balance. On the one hand, high-tech companies like Microsoft and Google prize H-1B visas because they say those work permits allow them to fill gaps in their operations for which there is a shortage of qualified Americans. On the other hand, some American programmers say abuse of the system has displaced American workers and depressed their wages. There's truth to both perspectives, Fishman said, adding that the Department of Labor isn't as well-equipped to fight suspected fraud in the H-1B program as it could be. Part of the reason, he said, is that the system is based on "attestations" from employers that they're hiring employees with the proper qualifications and at the requisite wage levels, and the Labor Department "has to wait around for some to complain" before it opens an investigation, Fishman said. "The H-1B program can and usually does operate to the benefit of both American high-tech companies and American workers," he said. "It is the job of Congress to ensure that it always does."