Posted on 12/26/2002 9:38:29 AM PST by FlyingA
H-1B
Some facts:
1. The economy was tubing before George JR even was elected, and way before he was sworn in as President! It started tubing in the middle of July, during the election, and basically Clinton did nothing, but campaign for his wife, and count the silverware and select furniture (and young female aids) in the White House to take with him to his new "home" in NY.
2. The boom of the 90s was in fact 90% smoke and mirrors. It was built to flip (a principle that you can find numerous articles about). Buy low, make everything look good, and then sell high before it all implodes. A very select few made millions off the scam (and it went past the point of being a business model, to the point of being turned into a scam similar to pyramid scams).
3. The IT field was already dead and flooded with H1bs by this time. IT Companies had already pushed as much of their capabilities offshore as fast as they could by July of 2000. The stage was more than set for the fall of the IT industry. And in fact had already started the decline in 98, but had been made to appear to be OK by fancy accounting.
4. A Congressman best summed up what happened in the 90s during the Global Crossing hearings with the remarks to their former CEO: "You bought what you didn't need, with money you didn't have, and wrote checks for it knowing that they would eventually bounce. You played a shell game with the money, fixed the books to make things look OK, paid yourself huge salaries and bonuses, and made a huge personal fortune out of it, and then jumped ship before it all came crashing down, leaving everyone else to go down with the ship."
Face it, H1b, the 90s was an artificial boom (scam) created by a few top executives with some "get rich quick" schemes that netted them fortunes (and we will never know how much they really made because the majority of it went into offshore accounts that the Government can't get to, or if they can, they won't blow the sources over a fraud case) and left most of the people holding an empty bag. And, the worst part is that everyone seen it coming, knew it was coming, knew it couldn't be stopped, and still ignored it because they "wanted to believe" that the good times would never end. And they really didn't end until the Government stepped in and forced the CEOs, CFOs, and top execs to be personally, punitively, and criminally liable for the financial statements of their companies in July of 2002. What you will find, as very interesting reading, are all the revised financial statements listed on or about Aug 14 2002, on the SEC.GOV site. Most Corp's had filed by July 2002, showing great profits trying to boost their stock value (another important factor in "built to flip"...make things look good). Then, all of a sudden, they (CEOs, CFOs) could go to jail for, let's call it a lack of accuracy in their financial statements, and they quickly corrected the filings, showing the real situation (which by the way they knew all the time anyway, because they had been running two or three sets of books), which was none to bright needless to say. In a nutshell, during the 90s, illegal fraud had become so wide spread that it had become accepted as normal business practices. But, that ended also.
And now we are paying for the eight years of neglect. Paying with an economy that is in shreds, fear of foreign terrorist attack, companies that are still shoving infrastructure off shore as fast as they can, and definitely not enough jobs to go around. It took eight years to get in this mess, and will take a lot longer to get out because now the laws prohibit faking a recovery with fancy accounting. If there is going to be a recovery, it is going to have to be a real recovery, built on true growth, not "smoke and mirrors" and "fancy fraudulent" accounting. A real recovery built on tangible increase not fancy accounting. And, it takes a lot longer to build something good than it does to make something look good. I have a feeling it will take another 3 or 4 years before this mess is finally fixed.
Futher, the link you posted is to an article that feeds to the current sentiment of CEO-bashing. It is written by someone who would flunk a core corse in a decent business school.
Here are a few pearls.
Twenty years ago, widespread use of high-yield junk bonds fueled the boom. The were several factors, such as: productivity increase resulting from the use microcomputers, return to a responsible monetary policy, massive deregulation (telecom, arilines, etc.)
Financing instruments do not fuel economic booms or busts. THey are just that --- instruments.
Then as now, the big players--mostly banks and so-called corporate raiders--invoked the mantra of shareholder value to justify enormous merger-and-acquisition transactions.
Garbage. Firstly, the main critique against the management is that it did NOT invoke the "mantra of shareholder value" in 1990s; it did not use the standard valuation approach to business. Secondly, the main reason for the "mania" of 1980s was that the industry structure was outdated and under attack from the Japanese firms that were producing --- suddenly for American observers -- goods that were cheeper and deemed better by consumers. This is when new methods of quality control were introduced, when Detroit went back to the drawing board, when new labor relations had to be established. Shortly before that, the prevailing mentality was towards conglomerates: to diversify for more predictable profits and to smooth out cycles. An example is Schlumberger, an oil-drilling giant, bying a photo camera maker. By mid- and late-1980s, these extraneous business units had to be separated (spun off).
It is the aforementioned, and some other forces --- powerful marcoeconomic and trans-national in scale -- that led to the mergers-and-acquisition "mania" of the 1980s.
Naturally, during revolutions and upheavals many new things come into being. High-yield ("jumk") bonds were one of them. To reduce the picture to something so insignificant is false to the point of being preposterous.
It serve, of course, the true reason behind such artciles: to fuel you anger. Well, so did the Great October Socialist Revolution that brought Russian commies to power.
You probably provide a source, then, because my understanding is that the Immigration Act (as amended) provides for about 190,000 H-1B visas. That's a total figure, over all industries.
But you are using a reverse (non)example, here: the companies wanted to buy cheep, generic goods (programmers) and none was domestically produced. THat is why they resorted to imports.
The salaries are artificially low You cannot say that: the price is what market determines.
-- it's like price dumping in the market. There is no such thing as "price dumping." Please check what dumping of a good is.
I think your reasoning that they are only sponsoring H1b's because they have not been able to fill the job otherwise needs some kind of statistical support. I have it and you do too: the market has spoken. Import entails extra costs. In this case, it is sponsorship for a visa, with all the legal and reporting expense. If a company could hire a worker with the same skill at the same salary without this trouble, it would. The market has spoken. about the only failing with the free market system is that people don't make the right choices.
And who determined what's right?
You have resorted to defamation, calling Rubin greedy. I asked for support of his greed and how you think Rubin profited from it. Your reference to him as a Clintonite is not an answer.
Rubin is not a friend of mine, but I do try to fallow Commandments. You served as a false witness and defamed a person without any foundation. YOu continue to do so even after this was pointed out.
This is not nice. I am sure your mother told you that.
Labor Condition Application Database
H-1B LCA Requests 10/1/1998 to 10/16/2001
H-1B LCA Requests Submitted 1,101,159
H-1B LCA Requests Certified 986,972
A single certified request may contain many Visa Requests.
Total H-1B Certified Visa Requests 4,075,021
Visa Start Date Certified LCA Requests H-1B Visa Requests
1998 58,134 298,246
1999 262,737 962,915
2000 396,181 1,489,591
2001 265,260 1,314,520
2002 4,399 9,416
Other 261 333
Section 214(g) of the Immigration and Nationality Act (Act) sets an annual limit on the number of aliens that can receive H-1B status in a fiscal year. For FY2000 the limit was set at 115,000. AC21 [the American Competitiveness in the Twenty-First Century Act] increases the annual limit to 195,000 for 2001, 2002 and 2003. After that date the cap reverts back to 65,000.
Source: U.S. Department of Justice--INS
How many industries need to be destroyed before you finally admit the economy is in "shreds" ... or at least hurting very badly?
How many of your friends who are highly skilled Telecommunications, IT, EE's and others need to be out of work before you finally admit the economy is in "shreds" ... or at least hurting very badly?
What does the unemployment rate need to be before you finally admit the economy is in "shreds" ... or at least hurting very badly?
How high does the bankruptcy rate need to be before you finally admit the economy is in "shreds" ... or at least hurting very badly?
How many homes need to be foreclosed on before you finally admit the economy is in "shreds" ... or at least hurting very badly?
By the time YOU lose YOUR job, it'll be too late.
What I did suggest is not to be hasty with opinions, especially when they are negative: when we do, we may cross the line of defaming someone.
Of course you are entitled to your opinions. Sorry you did not find my remarks helpful.
Thank you for writing.
Regards, TQ.
The site host admits to fudging the numbers to bring the averages below $100k. He conveniently concluded that some of the higher numbers would skew the data. He didn't mess with any distractions like standard deviations or other accepted statistical methods.
Maybe there is no clearinghouse of data on the web yet, but I really think one would need to look at official DOL and INS numbers before using this guy's numbers in an argument. (And by the way, the numbers he has for my company are WAY off).
What industries have been destroyed lately? Buggy whip makers? And don't give me any Telecom crap, there's still a fortune there.
How many of your friends who are highly skilled Telecommunications, IT, EE's and others need to be out of work before you finally admit the economy is in "shreds" ... or at least hurting very badly?
A hell of a lot more than there are now. I personally think some of the recent IT grads need to retrain/reeducate in another field. Too many techies out there right now. That's not necessarily a bad thing; for example, we could use a s***load of nurses, medical technologists, and other well paying professionals.
What does the unemployment rate need to be before you finally admit the economy is in "shreds" ... or at least hurting very badly?
Glad you asked: it needs to be a lot higher than the current rate, which is a point or two above historical "full employment". How soon some people forget the days of 8% unemployment.
I won't answer the bankruptcy and foreclosure questions, because I don't have any thoughts on those.
I'm not worried about being out of work, but thanks for your concern.
YOu must be kidding! The current unemployment level is one of the true miracles of the boom of 1990s, which is still with us.
As recently as in mid-1990s the commonly known, historically observed fact was that the unemployment level we have today was impossible to achieve without hurting the economy. If you have low unemployment, wages rise, and you have inflation. What is the lowest unemployment level that does NOT cause inflation? It has been estimates to be around 6%. For most of the late 1990s, it was much below that, and even below 5% --- in a sustained manner.
Your remark shows one of the roots of the problem that leads actually to H1B. Most Americans, due to poor education and cynical media, do not know how good they have it. And demand more. Demand wages that they do not deserve. One should not be surprised that the firms prefer to hire workers for more reasonable wages.
I agree that the companies wanted to buy cheap programmers, and that's what they got. What I argue, however, is that they have an inaccurate view of both the value of the imported worker and the quality of the domestic worker.
The idiot manager doesn't care if they are any good are not. So what I am arguing is that they didn't really get much of a programmer at all.
The extra costs are irrelevant, because the total cost is still less than the domestic worker.
I think you give the decision makers too much credit. It was amazing how blinded the managers were by the mere cost-cutting to the fact they were getting supremely inferior work.
This is only a restatement, but is not an answer. What is quality? You want a coffee-maker that is most efficient, and I wanted in green color. WHat is the high-quality coffee-maker?
The answer lies in the fact that each person has preferences which may be measured by a utility function, U(x1,x2,...), where x1,x2,... are "qaualities" to whicxh you refer. Each decision-maker selects that combination so Xs that maximizes the function U. Each person is right for himself thus. The next time you hear someone saying the consumers don't know what's right, laugh into that person face: the statement is ridiculous.
The idiot manager doesn't care You appear to make a typical mistake with respect to gov't and management. Can you learn chemistry by digesting food? The fact that you have a heart does not make you a heart surgeon, right? Obvious.
Except when it comes to management: you assume that becasue you know programming you also know how to manage programmers. "Idiot manager" is a giveaway: you have no clue about management. (It is true that one can find a poorly qualifies person at any level, but this not what we talk about). I think you give the decision makers too much credit. It is a well-known fact that, while individual decision-makers can make mistakes, when you see a developement at the level of the whole economy, it is rational and is not a mistake.
It was amazing how blinded the managers were by the mere cost-cutting to the fact they were getting supremely inferior work. THat is the point: you do not know how to count money and what is cheap and what's expensive as a result. Take a few business courses, you'll see: this cost-cutting does make sense.
This remark alone shows how disconnected you and Mr. Bird truly are from the fundamentals of our economy.
You either mis-read my post, misunderstood my post, or are deliberately being misleading. I don't know which but let me correct you: I was commenting on HIGHLY TRAINED, WELL EDUCATED professionals in the Telecom, IT and EE (Electrical Engineering) fields. These aren't the low-educated people YOU wrote about. These are highly trained, highly educated professionals.
I know of at least 10 people all with B.A. degrees and above that have been out of work for over a year. I know several more that have been out of work for 6+ months, and more that were let go between Sept. 1st and Dec. 15th. of this year.
None of their prospects are very good at the moment, and some of them were let go in place of releasing H1B workers. That hardly seems right to me. How about you? Seems non-Citizens have more rights than you and I do these days.
Wake up and smell the coffee pal. I was where you are a year ago and tried making the same points you are today. Then I opened my eyes and looked around. I see the damage H1B is doing.
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