H-1B and Cheap Foreign Labor

Wars on the American middle class.

It’s tough to be an American worker.

You’re a victim of collusion between the government and big business to suppress your wages through imported foreign labor, and when you object to losing your job to a foreigner you’re deemed a racist or lazy – or both.

Credit, I guess, to Vivek Ramaswamy for setting off the dispute about American talent and the real “reason” top tech companies hire foreign engineers. Perhaps you’ve seen his tweet, and if you haven’t it’s worth a hate read. It’s supposedly about culture: that we celebrate mediocrity, that we need less sleepovers and more math tutoring, more extracurriculars and less “hanging out at the mall.” That we celebrate “Zach & Slater over Screech in Saved by the Bell.”

As an aside, what the hell is this about Screech? We were raised on Saved by the Bell. Call us subject matter experts. America doesn’t achieve because it doesn’t venerate Screech, the smart kid who lacked common sense and social intelligence? That Screech?

And is this the way to build well-rounded adults or to ensure STEM dominance? To deny them bonds with their friends (sleepovers) and the freedom of leisure (“hanging out at the mall”) and what they learn through high school sports (discipline and teamwork), and to instead replace it with forced science camp and Saturday mornings doing long subtraction and a regiment to make them the most capable of increasing shareholder value in the future? What a miserable existence.

We dare think of what Vivek might of other activities that are undisputedly worthwhile for the development of the young, whether they be hiking or fishing or simply exploring the outside world. You have your whole life to be a corporate drone – let them enjoy their youth while they can. It can make a better person in the long run.

Not that America doesn’t have its educational or cultural problems, and the lowering of standards has certainly undercut the development of our brightest, but we still produce the best STEM talent out there. It’s also worth noting that many of the brilliant engineers and scientists and entrepreneurs that built America and American technology didn’t have the upbringing or grades that Vivek demands.

Steve Jobs was a mischievous kid who who dropped out of college after a semester. Steve Wozniak, who co-founded Apple with Jobs, was an electronics prodigy who was self-taught. Wozniak left the University of Colorado after running up a $50,000 bill (measured in today’s dollars) in computing time.

Or consider Jack Kilby, who was from small-town Kansas and had a variety of interests as a young man: sports, photography, radio, and especially electronics – an endeavor he had the freedom and time to explore. He failed the MIT entrance exam and enrolled at the University of Illinois to Electrical Engineering. Kilby had average grades as an undergraduate and later received an MS in Electrical Engineering from the University of Wisconsin. He went on to invent the integrated circuit (microchip) during his time at Texas Instruments (independently and concurrently with Bob Noyce). Kilby would receive the Nobel Prize in Physics in 2000.

But Kilby’s story is not only relevant to Vivek’s misguided rant. It also poses a question: would Kilby be given an opportunity in America’s current economic climate, where talented and well-qualified citizens are ignored for cheaper foreign labor?

Or - are just how many other talented Americans are passed-over, or fired and replaced, so the mega-corps can earn an extra quarter cent per share?

As you may have seen, the Twitter discussion over the hiring of foreign workers evolved into a debate over corporate labor abuses with a specific focus on the H-1B program, which “applies to employers seeking to hire nonimmigrant aliens as workers in specialty occupations (those that require at least a bachelor’s degree) or as fashion models of distinguished merit and ability.”

And it was enlightening, if only to see that the supporters of H-1B in its current form (or in many cases a slightly reduced form) essentially disclaim any sense of duty towards, or a mere interest in, fellow Americans who lose their livelihoods to imported competitors. Corporate profits seem to be the only measure by which a country’s worth should be valued – not social cohesion or a person’s opportunity to earn an honest living.

Those wanting a fair system, those opposing cheap foreign labor and advocating for the interests of American workers (and their families, on whom they rely), are labeled racists or pelted with insults: the “woke right”, DEI for white people, slothful, etc. We haven’t seen anything this disingenuous and this dishonest in a long time.

Case in point from serial plagiarist Collin Rugg:

Of course, the debate isn’t over who will work longer hours and it’s dishonest to say otherwise. H-1B workers (or other imported equivalents) aren’t working 80 hours – save for a few exceptions, nobody else is either. Even the overworked associates in BigLaw aren’t putting up those numbers for the most part. Again, there are exceptions. And it’s not about laziness; Americans are generally willing to study and work and contribute, and they do so in with creative ingenuity that many other countries can’t replicate.

Then there’s the wrong argument that this has to do with merit – that American’s aren’t as qualified for the jobs, thus necessitating work visas. The proponents of imported labor would have you believe that American employees, who have thrived in positions for years, are inadequate. So inadequate, in fact, that the companies promoted these same employees over the course of their careers and trust them to train their replacements.

To support our point, a Vice President for Cognizant, a staffing firm that has sourced tens of thousands of H-1B visa holders to tech firms and other industries (and which abuses the H-1B system to replace its own workers), recently “admitted that visa workers are not more ‘skilled’ than U.S. workers.” No shock there - American engineers have long known about the poor quality of work of their foreign peers.

Cognizant, by the way, was recently held by a jury to be liable for intentional discrimination against non-South Asian and non-Indian employees for whom it sponsored H-1B visas. This isn’t just a one-off for Cognizant; back in 2020, the EEOC found the company discriminated against a “nationwide class of non-Indian employees on the basis of race and national origin.” And in 2018, an internal Cognizant report documented that H-1B holders were the beneficiary of racial disparities in rates of “involuntary terminations.” (That’s just the tip of the corporate misconduct regarding the H-1B program. There’s a ton out there if you care to look.)

Instead of merit or the willingness to work, this is what it has always been about: cheap labor and the discriminatory practices that come with it. As reported by Bloomberg, one global executive for Cognizant said the company’s “preference for Indian H-1B workers is intrinsic to its outsourcing business model because they are almost the cheapest labor option.” And at trial, this text from one Cognizant executive was admitted as evidence: “An open secret: we hired H1s for the longest because they were cheaper labor that would relocate anywhere.”

But it’s not just that American jobs are being taken. It’s also that American wages are being intentionally depressed. So much for the alleged talent shortage.

All of this coincides with mass layoffs of domestic employees by the very companies that take advantage of the H-1B system. In 2022, “the top 30 H-1B employers hired more than 34,000 new H-1B workers.” Those same companies “also laid off, or [would] imminently lay off, at least 85,000 workers in 2022 and the first quarter of 2023.”

It comes as no surprise that cheap labor has always been the end-strategy – or at least the predicted result – of H-1B. As observed by Eric Weinstein, the effect of holding down wages (and providing less of an incentive for Americans to enter certain professions) has been known since the start. It’s simple supply and demand.

If we are to discuss solutions, then we have to be honest about the problems. How do we support American workers, and support living wages, while attracting the top talent from overseas? It’s easy to do both. End H-1B, which victimizes the American middle class, and keep the O-1 visa for those individuals with extraordinary achievements or abilities. H-1B has run its course. Don’t feel bad for the mega-corporations - it was their abuse of the system that will hopefully contribute to its demise.