This newsletter from Norm Matloff of UC-Davis discusses /exactly/ what I mentioned yesterday about the government's complicity in lowering the salaries of American workers since 1990.

Obama's proposed 'temporary' increase in H-1B smells of lobbyist influence.

This comes straight from the ITAA, Compete America, and Stuart Anderson's 1-man "foundation" which is ironically named the 'National Foundation for American Policy'. Nowadays it appears that 'American Policy' is to favor foreign students and workers /over/ our native students and workers.

Mark my words:
The Democratic majority in the 111th Congress will screw American high-tech workers even worse than the do-nothing 110th Congress.

- sjl

From: "Norm Matloff" <matloff@xxxxxxxxxxxxxx>
Sent: Monday, November 10, 2008 11:51 PM
To: "Norm Matloff" <matloff@xxxxxxxxxxxxxxxxxxxx>
Subject: CW's Thibodeau speculates on what Obama will do on H-1B, GCs

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

The late Herb Caen of the San Francisco Chronicle often gave "Unclear on
Concept Awards" for ideas that clearly were not well thought out before
implementation. For instance, he wondered about the wisdom of
supporters of a SF city ballot proposition waving placards at commuters
leaving the city in the afternoon rush hour--most of whom could not vote
on the proposition, as they don't live in the city. I must say that
the enclosed blog by Pat Thibodeau, an excellent writer for
Computerworld, seems Unclear on Concept to me.

Addressing proposals such as those by Rep. Zoe Lofgren, "Queen of H-1B,"
to give essentially automatic green cards to foreign students in STEM
graduate programs at U.S. universities, Thibodeau asks rhetorically why
Congress would enact such legislation in today's severe economic times.
His answer is that Obama's campaign promise to increase research
spending will require giving the foreign students these easy green

It's unclear whether this is merely speculation on Thibodeau's part or
Obama's people have actually given him indications along these lines.
He doesn't cite any Obama aides. In any case, the entire notion just
doesn't make sense.

First, the foreign grad students themselves don't have much of a green
card problem in the first place. As I've noted before, people with grad
degrees, especially PhDs, already have priority for green cards, with
short waiting times. The much-lamented long waiting times for green
cards are experienced mainly by those who just have a bachelor's degree
(see the data at

Second, as I've often noted, the reason there are so many foreign
students in U.S. tech PhD programs is that doctoral study is simply
financially unattractive to American students. Even the industry-oriented
NRC study found that an American student incurs a lifetime loss in
earnings by studying for a PhD. That in turn is due to the presence of
the foreign students themselves, who act as cheap labor both in graduate
school and later in the workforce--all planned by our government
National Science Foundation.

I've often cited that NSF position paper, but it's so important that I
will excerpt it again here. Recall that the NSF specifically advocated
bringing in a lot of foreign students in order to attain the NSF's goal of
holding down PhD salaries. The paper commented on the consequences:

# A growing influx of foreign PhDs into U.S. labor markets will hold down
# the level of PhD salaries to the extent that foreign students are
# attracted to U.S. doctoral programs as a way of immigrating to the
# U.S. A related point is that for this group the PhD salary
# premium is much higher [than it is for Americans], because it is based
# on BS-level pay in students' home nations versus PhD-level pay in the
# U.S...

# [If] doctoral studies are failing to appeal to a large (or growing)
# percentage of the best citizen baccalaureates, then a key issue is
# pay...A number of [the Americans] will select alternative career
# paths...For these baccalaureates, the effective premium for acquiring a
# PhD may actually be negative.

And again, note that it's not just the industry salaries for PhDs, but
the large numbers of foreign students keeps stipends for grad students
low too, around $15,000 for the 9-month academic year. Comparing this to
the $60K or more that a new bachelor's holder starts with in industry,
you can see now why the NRC found that doctoral study is a financial
loser for domestic students, something the NSF recognized too in the
last passage above. That's why there aren't so many domestic students
in grad school.

If Obama really does increase research funding (actually, I think he
will simply reallocate other research funds to energy research etc.), we
would not "need" the foreign students, as the blog claims. All that
would need to be done is to raise the graduate stipends.

I served as graduate admissions coordinator in my department for 13
years, and thus have seen this up close. Money does indeed motivate
potential grad students. Give them a stipend even half of what industry
is offering, and they will apply in droves. Every computer science
graduate admissions officer knows this only too well. Even Hillary
Clinton made this proposal during the primary campaign.

It's even more true now that tech layoffs are beginning. The classical
pattern is that in times of economic slowdown, grad school applications
surge. And we're in much more than a mere slowdown now, with the
implosion of the financial sector and its shock waves felt by most other
sectors. I mentioned the other day, for example, that in recent years
about 30% of Carnegie-Mellon University graduates in electrical
engineering have been hired by the financial industry. Since that
industry is laying off like crazy, and there isn't much hiring
elsewhere, a lot of this year's CMU grads are going to find grad study
to be a good option. If only we offer them a reasonable stipend, even
more will apply.

Regardless of those conditions, academia and industry are going to have
to wean themselves from this dependence on foreign students anyway. As
I have noted frequently, including the other day, interest among foreign
students in U.S. study had been declining in the last few years anyway,
well before Wall Street's implosion.

For details on this, I again refer you to the materials in where you can see
quotes from immigrant executives in the U.S. explaining that the tech
markets in India and China have grown to the point at which new grads
find it more attractive to stay home than to come to the U.S. Here
is a condensed version of the comments you can find at the above link:

[Quoting Lin Lee, director of Sun Microsystems' government strategy in Asia:]
...said many [Chinese] entrepreneurs want to join startups in China — where
even five years ago they would have tried to immigrate.
[Quoting Rosen Sharma, a U.S. CEO who graduated from India's top top university,IIT:]
Of the 40 people in Sharma's graduating class at IIT Delhi [in 1993], he
says, all but three came to the U.S...Last year, only 10 of the 45 IIT
graduates...decided to pursue jobs in the U.S.

So even if our economy improves, expecting to rely on the foreign
students in the coming years is utterly unrealistic.

If Obama really wants people to staff his ambitious research projects,
he should avoid the advice reported/speculated in the enclosed blog, and
take up Sen. Clinton's suggestion on grad stipends.



FAQ: Why Obama may back an H-1B increase even in a recession

If the president-elect moves quickly to boost basic research funding, the
visa issue will be part of the debate

By Patrick Thibodeau

November 6, 2008 (Computerworld) President-Elect Barack Obama has
supported the H-1B visa program and wants to make changes to green
cards that would help tech firms. There wasn't much said about this
issue during the presidential campaign, especially after Wall Street
collapsed. It also never came up in the debates between Obama and
Republican John McCain. Now we're in a recession and unemployment is
rising. Can Obama push ahead on tech-related immigration issues at this
time? He might, and in this FAQ, here's an explanation of how that
might happen.

Does Obama support the H-1B visa program? Obama supports the temporary
visa program but also wants it reformed. It needs reform. A U.S.
Citizenship and Immigration Services report released in October said as
many as one in five visa applications are either fraudulent or flawed.
Some of the problems were egregious, including H-1B visas approved to
shell companies.

If that weren't enough, the U.S. Department of Labor added to the
evidence of abuse, including a settlement last month requiring a
Virginia-based company that also operates an offshore center in India
to pay $1.7 million to 343 employees. Obama says he wants to "hold
accountable employers who abuse the system and their workers," (PDF
Page 8 on Obama's tech platform under the section titled: Reform
Immigration ).

Will Obama increase the H-1B cap? Obama supports raising the H-1B cap
and did so in the U.S. Senate immigration bill in 2007. It would have
increased the current 85,000 cap, which includes 20,000 visas set aside
for graduates with advanced degrees. The Senate effort, which died in
the House, would have allowed increases of up to 180,000 H-1B visas, as
well as additional visas for advanced-degree graduates. Obama also
continues to support comprehensive immigration reform.

Excuse me, but how can Obama support increasing H-1B visas during a
recession? Good question. Tech companies are cutting employees and the
recession isn't stopping offshore outsourcing. The largest users of the
H-1B visa are India offshore companies. When a U.S. company hires an
outsourcing vendor, U.S. workers may be required -- if they want their
severance -- to train their H-1B holding replacements. Moreover,
offshoring is increasingly being aimed at higher-level jobs.

Obama has pledged "to stop giving tax breaks to companies that ship
jobs overseas," but he hasn't linked the H-1B visa to this issue.
Indian offshore firms are worried he may do so.

Why not increase green cards instead? Last May, U.S. Rep. Zoe Lofgren
(D-Calif.) tried to bypass the immigration deadlock by introducing
several bills to clear a direct path to permanent residency -- green
cards to foreign students who graduate from U.S. universities with
advanced degrees. Congress isn't expected to act on those bills during
the upcoming lame-duck session.

The tech industry argues that restrictions on the green card are as
much of a problem as the H-1B visa issue. Easing access to green cards
is an issue Obama supports. "We should allow immigrants who earn their
degrees in the U.S. to stay, work and become Americans over time. And
we should examine our ability to increase the number of permanent visas
we issue to foreign-skilled workers," he said in his platform.

Isn't increasing H-1B visas and permanent residency green cards a
nonstarter of an issue during a recession? No. In fact, the visa issue
may reappear with a vengeance, and here's why. Obama wants to double
basic research spending over 10 years, and a lot of that money will
fund research at U.S. universities that enroll thousands of foreign

In the fall of 2007, of the approximately 112,559 students enrolled in
U.S. engineering graduate programs, IT related and otherwise, 50% were
non-U.S. citizens, according to the Council of Graduate Schools, in a
report released in September (Report PDF ). Visa proponents argue that
it makes little sense to improve basic research at universities only to
force graduate students back to their home countries.

Basic research is a cornerstone of Obama's tech and energy policy, and
the polar opposite of the Bush administration, which actually cut basic
federal research funding. (See this chart by the National Science
Foundation.) If Obama can find the money to increase basic research,
then the issue of keeping foreign students in the U.S., especially
those students who work on government-funded research projects, brings
these two issues together.

Some tech lobbyists believe that increases in H-1B visas and green
cards won't happen as long as U.S. companies are cutting jobs. But that
will mean the debate will shift as well. "What do we need to do to
ensure that we can grow our way out of this [downturn], innovate our
way out this? You can't have that discussion without talking about
immigration," said Robert Hoffman, vice president of congressional and
legislative affairs at Oracle Corp., and co-chairman of Compete
America, a lobbying group that supports raising the H-1B visa cap.

Isn't this just too hot of a political issue for Congress and Obama?
Opponents argue that the visa policies are partly to blame for
declining computer science enrollments by Americans. Because the H-1B
program offers the prospect of employment after graduation, it
encourages foreign students to enroll, and those large enrollments are
discouraging U.S. students from entering IT-related fields.

This argument may rise again during the next debate on the visa issue,
but it's not new and it's not an argument that finds support in Obama's
platform. The bottom line is this: Obama has said nothing during the
campaign that rules out either H-1B or green card increases. If
anything, his tech platform, especially his plan to boost research
funding, offers an argument for encouraging foreign enrollments and
increasing access to visas.

As an Amazon Associate we earn from qualifying purchases.

This thread ...


Follow On AppleNews
Return to Archive home page | Return to MIDRANGE.COM home page

This mailing list archive is Copyright 1997-2021 by and David Gibbs as a compilation work. Use of the archive is restricted to research of a business or technical nature. Any other uses are prohibited. Full details are available on our policy page. If you have questions about this, please contact [javascript protected email address].

Operating expenses for this site are earned using the Amazon Associate program and Google Adsense.