Dr. Dobb's Journal December 1998
The H-1B visa reform bill -- officially known in the U.S. Senate as the "American Competitiveness Act" and "Workforce Improvement and Protection Act of 1998" in the U.S. House -- is a done deal. Central to the legislation sponsored by Rep. Lamar Smith (R-Tex.) and Sen. Spencer Abraham (R-Mich.) and endorsed by President Clinton are increases in H-1B temporary visas for non-U.S. high-tech workers -- from 65,000 this year, to 115,000 in 1999, 115,000 in 2000, and 107,500 in 2001.
In addition, the bill provides training and up to 10,000 scholarships a year for low-income students in math, engineering, and computer science. These programs are funded by a $500 per visa fee, and a $500 visa renewal fee. If all goes according to plan, this should raise about $75 million a year. Furthermore, the bill purports to provide job protection for U.S. workers, requiring that "H-1B dependent companies" attest that an H-1B worker is as (or more) qualified than any U.S. applicant. A "dependent" company has more than 50 employees, 15 percent or more of whom are H-1B workers. "Non-dependent" companies, on the other hand, are those with 25 employees and fewer than seven H-1Bs, or 26-50 employees and fewer than 12 H-1Bs.
According to Senator Abraham, "The American Competitiveness Act will help U.S. companies to remain competitive in global markets and to expand educational and training opportunities for American students and workers." President Clinton concurred, saying at Silicon Valley's Tech Museum of Innovation that it's "really good for everybody in America, because in addition to permitting more visas of high-skilled people to come into our country and strengthen us, it also provides a lot more funds to train our own people, to upgrade their skills. It has the best of both worlds."
Sounds great. So why is everyone bent out of shape about it? Many people, including University of California-Davis professor Norman Matloff, believe H-1B reform would be unnecessary if high-tech companies would end hiring discrimination against midcareer (that is, over 40 years of age) workers, not to mention women and minorities. Organized labor opposed the bill and was angered at the Clinton-Abraham compromise. AFL-CIO President John Sweeney said that "there are serious flaws in [the H-1B visa reform bill]. The bill exempts some employers -- no one knows how large this group is because of the lack of available data -- from making the recruitment and layoff attestations. And employers who have illegally laid off an American worker in order to hire an H-1B visa worker may be fined or excluded from the program, but cannot be required to give the worker his or her job back or repay any lost wages." Labor claims that the Clinton-Abraham compromise was a sellout in exchange for high-tech campaign contributions.
The American public seems to agree. According to an IEEE-USA/Louis Harris public-opinion poll, more than four out of five Americans oppose substantially increasing H-1B visa limits. Specifically, 82 percent of those polled opposed "allowing U.S. companies to sponsor 190,000 additional foreign technical workers as temporary employees for up to six years." Similarly, 66 percent disagreed with the premise that "without adding additional temporary foreign workers, the United States might be forced to transfer work overseas."
The increase in H-1B visas isn't a hit overseas, either. Foreign governments and businesses are decrying the "brain drain," as their best and high-tech brightest move to the U.S. for higher paying jobs. According to some erroneous international news reports, the U.S. is all but offering free citizenship to anyone who can program. As for guest workers themselves, they often feel used when discovering they can't switch jobs or that H-1B doesn't guarantee permanent U.S. residency.
And even those high-tech companies that pushed for H-1B reform haven't been that pleased -- they don't like having to attest to recruitment and no-layoff provisions. (Attestations aside, most U.S. high-tech companies -- particularly the large ones -- still like the new H-1B rules. They can hire less-expensive workers who are indentured to corporate service, and not have to worry about more experienced U.S. workers changing jobs at will. Nor do big companies really have to worry about attesting, since they can employ hundreds of guest workers, yet remain below the 15 percent limit.)
So with this kind of opposition, why did Congress smile on H-1B reform? One reason is money. Big business pouring soft money into campaign coffers is more important to Capitol Hill than public opinion. Not to pick on Microsoft, but simply using it as a representative high-tech, deep-pocket H-1B supporter, a quick search reveals that the company and its chief officers directly or indirectly gave money to more than 80 percent of the House H-1B committee, and over 40 percent of the Senate committee -- none of whom are from the state of Washington. Likewise, TechNet, a high-tech political action committee (http://www.technetwork.org/), recently raised thousands of dollars to Senator Abraham's reelection efforts, even though he isn't running for reelection this time around.
It will be years before we know whether or not the H-1B visa reforms are good or bad for the global economy in general and U.S. workers in particular. Until then, it's comforting to know that it's back to business as usual on Capitol Hill.
-Jonathan Erickson