Date: Sun, 4 Jul 2010 16:58:00 -0700 From: Norm Matloff To: Norm Matloff Subject: reply to Obama's immigration speech To: H-1B/L-1/offshoring e-newsletter To my U.S. readers, I wish you all a happy Fourth of July, and of course convey general best wishes to all my subscribers in other nations. On this occasion, I'd like to comment on the speech President Obama made at American University on July 1. Later in this posting, I will focus on a specific H-1B visa worker and his employer, the latter being a model immigrant entrepreneur cited by Obama in his speech. But first, an important preamble. It is quite fitting, I believe, for me to write about immigration policy on American Independence Day. Although I'm a U.S. native, I've lived closely with immigrants all my life, and strongly support immigration to the U.S. of people from all nations and all walks of life. I consider immigration to be the very essence of America. On the other hand, I see today's immigration politics as nothing less than a metaphor for the destruction of our democracy, established 234 years ago today. My father was an immigrant from Lithuania, and though my mom was born in Chicago, she grew up in an immigrant community. I and my brothers (who by the way are married to immigrants from Egypt and Canada) thus grew up in an immigrant, "foreign" household, with our parents speaking Yiddish, while eating very non-Anglo foods and so on. Ironically, I unconsciously re-created that same setting for my own daughter, now 18, who grew up in our Chinese-speaking household, eating very non-Anglo foods, with periodic visits to relatives in China and so on. And having grown up partly in East LA, I continue to have a special affinity for Latino immigrants, a closeness that most white politicians will never feel and never understand. Though I am a liberal Democrat, I was not originally a big supporter of Barack Obama. As a longtime minority activist, I was pleased to see a black man elected president, and as a Jew I might quip, "Finally a president named Baruch!" But I stated here during the 2008 election that I felt Obama would, sadly, conduct Business As Usual. Certainly he was surrounding himself with Business As Usual types then, and continues to do so today. However, during his year and a half in office so far, I've seen a few glimmers of hope that he has begun to understand that the powerful special interests are in fact dominant and worse, destructive, and that his advisers tend to represent thoses interests. Obama has made a few statements here and there indicating that he is willing to fight those interests. Not much concrete yet, but I'm still hopeful. Having said all that, I must reiterate that today's immigration political actions, including those advocated by Obama in his speech, do indeed epitomize the loss of our democracy. Powerful entities that have highly vested interests crassly use this arguably noble tradition of immigration for their own hidden agendas, horribly corrupting our political system, and wreaking great economic harm on American citizens, both native and naturalized. The analysis I posted the other day on the Kagan e-mail inbox http://heather.cs.ucdavis.edu/Archive/Kagan.txt shows this quite well. We see that in 1998 the Clinton White House was highly skeptical of the industry's claims on H-1B, yet felt politically forced to raise the H-1B cap anyway, in spite of the harm it would bring to American programmers and engineers. I would add that a Harris Poll conducted that same year showed that the vast majority of Americans opposed an increase in the cap. So, Clinton's signing of the H-1B increase into law that year, in spite of popular opposition and because of lobbyist pressure, makes an excellent case study on the demise of our democracy. For all my praise of Obama above for his nascent emergence from the Big Business support crowd, I must lament that he seems to be showing no such courage on the immigration issue, as evidenced by this inaccurate, poorly-researched, misleading and some might say pandering speech. Let's begin with some excerpts of the Obama speech: The scientific breakthroughs of Albert Einstein, the inventions of Nikola Tesla, the great ventures of Andrew Carnegie’s U.S. Steel and Sergey Brin’s Google, Inc. -– all this was possible because of immigrants... So this steady stream of hardworking and talented people has made America the engine of the global economy and a beacon of hope around the world. And it’s allowed us to adapt and thrive in the face of technological and societal change. To this day, America reaps incredible economic rewards because we remain a magnet for the best and brightest from across the globe. Folks travel here in the hopes of being a part of a culture of entrepreneurship and ingenuity, and by doing so they strengthen and enrich that culture. Immigration also means we have a younger workforce -– and a faster-growing economy — than many of our competitors... Just a few weeks ago, we had an event of small business owners at the White House. And one business owner was a woman named Prachee Devadas who came to this country, became a citizen, and opened up a successful technology services company. When she started, she had just one employee. Today, she employs more than a hundred people... And while we provide students from around the world visas to get engineering and computer science degrees at our top universities, our laws discourage them from using those skills to start a business or power a new industry right here in the United States. Instead of training entrepreneurs to create jobs on our shores, we train our competition... We should make it easier for the best and the brightest to come to start businesses and develop products and create jobs... Some of this is blatantly misleading. Einstein is one of my (intellectual, not personal) heroes, but he essentially did nothing after he came to the U.S. Brin is a bright, highly enterprising young man, but he came here as a family immigrant at age 6, rather than as a foreign student as Obama's listeners might conclude. Google's search engine, PageRank, was originally the idea of Brin's U.S.-native partner Larry Page, not Brin, and in any case there are lots of other search engines. Where Obama first goes badly wrong is his claim that we need immigration in order to have "the best and the brightest" in our nation. But our H-1B/green card policy is causing our nation to produce FEWER native best-and-brightest, jobs-creating, world-leading scientists and engineers. As I've written, our government's central science agency, the National Science Foundation (NSF), explicitly admitted back in 1989 that H-1B and other efforts to bring in more foreign scientists and engineers would suppress salary growth and thus--the NSF went on to say--discourage domestic students from pursuing doctorates in science and engineering. And today the NSF has the gall to complain that not enough American students pursue a PhD! Anyone without a vested interest here would see the stupidity of such a policy, and would be outraged. The effect of H-1B on careers in science is absolutely disgraceful. The government and academia have created a huge oversupply of PhD scientists, which has led to a post doc labor system under which aspiring scientists run a many-year gauntlet of low-paid, temporary jobs, with no idea whether they will even get to have a permanent career in science in the end. The government might as well make it illegal to be a scientist. Again, an absurdly stupid, outrageous and above all destructive system, fueled by H-1B, the visa held by most foreign post docs. Quite contrary to Obama's grand claims of job creation, our H-1B/green card policies have made long-term careers in many fields untenable for many Americans. The key term here is "long-term." It's sadly ironic that Obama trumpeted the youth of the immigrants in his speech, since the H-1B/green card programs are used by employers for the purpose of avoiding older (age 35+) American tech workers. Younger workers cost less, in both wages and benefits, than older workers, and the attraction of H-1B and employer-sponsored green cards to employers is that these programs provide them with an inflated pool of youngsters to hire, as Obama's own statement highlights. If I were more cynical, I might even speculate that we've caught Obama in a Freudian slip. I'll return to the age issue later in this posting. Now, let's discuss Ms. Devadas, Obama's model entrepreneur. She's to be commended for building a successful small business from scratch, yes, the American dream. Good for her. She has developed a diverse set of employees, has apparently not hired many H-1Bs, and certainly is not running an H-1B IT sweatshop. (Her firm is not primarily even in the IT area anyway.) But my point is this: There are many, many U.S. citizens and permanent residents who are qualified for those jobs, and who would jump at the chance to have them. Though H-1B law did not require SEI to give hiring priority to Americans, Obama's speech wrongly implied that most employers like Devadas are supplementing the U.S. workforce--creating jobs!--rather than keeping a qualified American from a job, which is exactly what happens in most cases. It's not the H-1Bs' fault of course, but there are victims. Today's San Jose Mercury News profiles Beth Mezias, age 43 (note that age!), a software engineer who was laid off from Silicon Valley's Adobe Systems in 2008, and had been jobless until this week (http://www.mercurynews.com/business/ci_15421229). Meanwhile the DOL database shows that Adobe filed at least 11 LCAs to hire H-1B software engineers in 2009, and remember each LCA can be used to hire multiple workers. Adobe, of course, would say that the H-1Bs it hired are doing work that Ms. Mezias was not qualified for, but as I've shown in detail elsewhere, this is generally a red herring. It is pretty certain that Mezias could have done some of the H-1Bs' jobs at Adobe. Her problem, almost certainly, was not lack of qualifications (since 2008 she has successfully sold several Android phone applications, clearly showing her skills), but rather lack of youth--she is 43. She was just too expensive relative to H-1Bs. As I've often written, age is the central issue in H-1B. Employers use the H-1B program as a means of avoiding hiring the older Americans. This forces large numbers of American techies out of the profession (which among other things means they don't show up in unemployment data for the profession). For this reason, a fast-track green card program for foreign STEM graduates of U.S. universities, which Obama appeared to support in his speech, would be just as harmful as H-1B, as most beneficiaries would be YOUNG. One of my favorite subscribers wrote to me yesterday. He is a careful thinker, slow to overgeneralize. Politically conservative, he startled me with his radical language in an e-mail message to me, which graphically detailed his problems getting work as a software contractor. He is finding work harder and harder to get, and rates have fallen precipitously. Those that decide whether to hire him are mostly H-1Bs or former H-1Bs, many of whom he believes (quite correctly, in my experience) favor hiring their co-ethnics, especially those with H-1B status. It's like a continuing nightmare for this seasoned software developer who prides himself on the quality of his work, and is simply trying to make a living. I was startled to see this conservative, soft-spoken person demand of me, "Where is the existential horror?" in my postings in this e-newsletter. Don't I realize how powerless people the victims of H-1B/green card programs feel, abandoned and indeed sold out by their government? I had to assure this longtime subscriber that indeed I do realize it. Unfortunately, President Obama does not realize the situation. Or worse, as seen in the Clinton White House memos, Obama does realize it but feels forced to act against his conscience. Neither of these scenarios is a pleasant one to consider on this American Independence Day. Norm