To: H-1B/L-1/offshoring e-newsletter 159

This past Monday, CNBC ran a "debate" between Vivek Wadhwa and Ron Hira.
As many of you know, Vivek is a former CEO who now writes and does
academic research on the tech industry, and Ron is a professor of public
policy at the Rochester Institute of Technology, and who also does
research on the tech industry. 

Though most viewers wouldn't know it, Vivek and Ron actually agree with
each other on the issues at hand: Both are critics of the H-1B program,
and both support expanding the employment-based green card program.  (I
agree with them on H-1B but disagree regarding green cards.)  Both Vivek
and Ron have made important research contributions to the H-1B issue,
for the most part in mutually compatible directions.  (I still take
issue with some of Vivek's research, but I have found much of it to be
first rate.)

The subject matter in the debate was the recent enactment of legislation
that would place certain restrictions on the hiring H-1Bs by employers
who receive TARP financial industry bailout funds.  For example, these
employers will now be required to try to hire an American for a position
before filling it with an H-1B.

As someone who likes and respects both Vivek and Ron, the video clip was
painful to watch.  Vivek got carried away, and said things I think he
doesn't really believe.  Ron, by contrast, was very calm, with a "Why
did I EVER agree to participating in this circus?" look on his face, but
calm to the point of not aggressively defending his point of view.

I immediately decided not to post the incident to this e-newsletter, as
it was (and is) embarrasing to write about a battle between two men who
I hope I can call my friends.  However, I've changed my mind, and have
now composed the comments below.  I can't go into the details why I
reversed my original decision, except to say that I'm worried that the
academic careers of both men might be harmed, to some extent or other.
I therefore wish to set the record straight, as I see it.

First, exactly what did occur?  You may be able to watch the clip
yourself, at

http://media.cnbc.com/i/CNBC/components/Syndicated%20Video%20Player/videomod   
ule.swf?id=1056896654&pcode=cnbcpermalink&play=1&base=http://plus.cnbc.com/s   
tickers/partners/cnbcpermalink/      

I say "may," because CNBC has apparently removed the numerous sites at
which they had had the video.  They seem to have overlooked the above
URL, but I would guess that it will be gone pretty soon too.  And while
it is viewable by most people, many find it won't play; if that happens
to you, try another computer.

There were two issues that arose:  (a) Vivek claimed that the TARP
legislation was xenophobic, and (b) CNBC thought it "tragic" that the
Bank of America had rescinded job offers to some new foreign MBAs due to
the the new H-1B rules, thereby depriving the bank of genius talent just
when it needs it most.

Let's take (a) first:

Vivek is an Indian immigrant, while Ron is the son of Indian immigrants,
and many of Vivek's comments, delivered in a quite pointed tone, had the
theme that the TARP legislation was anti-Indian.  Vivek hurled rather
emotionally-toned remarks at Ron along the lines of, "Next, they'll come
after you!" And I suppose the implied subtext may also have been that
Ron was somehow a traitor to Indian-Americans. 

Such statements, in both substance, tone and body language.  were
uncalled for.  The fact is that far more Indian-Americans have been
harmed by H-1B than have benefitted by it.  Come on--the number of
Indian-American bodyshop owners and political activists is dwarfed by
the number of Indian-American programmers and engineers.  In short,
the TARP legislation was, if anything, PRO-Indian-American, not anti-.

I wish to quickly add, though, that Vivek has a point.  Since H-1B has
come to be perceived as an "Indian" visa (outnumbering, for instance,
Chinese H-1Bs by an 8-to-1 margin the last time I checked), one should
worry that the legislation might be misconstrued by some.  It would have
been helpful if Senators Grassley and Sanders had explained that the
VICTIMS of H-1B include many Indian-Americans, and for that matter, many
others of non-European ancestry.  The politicians on the Hill, who seem
to accept the industry lobbyists' claim that the ones who complain about
H-1B are whites, would benefit by sticking their heads in a university
computer science class, because they'd see tons of Asian-American (no,
NOT Asian foreign-national) students.

Vivek should be making that same point.  It has been reported that Vivek
has said that his own son was had had difficult finding IT work at one
point, due to H-1B.  I don't know if this is accurate, but it is
certainly safe to say that Vivek would agree that many Indian-Americans
are victims of the H-1B program.  And he should have said so on CNBC,
rather than unduly alarming Indian-American viewers that Congress was
out to bash Indians.

Vivek, and for that matter Ron, should have also pointed out that the
TARP legislation is not the abrupt, radical change that the industry
lobbyists are portraying it to be.  It is merely an extension of
existing law:  It derives from the H-1B-dependency law, and probably
more importantly in my context here, the TARP legislation's U.S.
recruitment requirement for H-1B is, in essence, the same as the
corresponding requirement for employment-based green cards--a law in
place for several decades.  Yes, the banks now will have some extra
hoops to jump through, but they and all other employers have had to do
that in a related context for many years. 

(And if these workers are "the best and the brightest" as the lobbyists
claim, why should the banks mind going through extra hoops, given the
chance to hire "geniuses"?  By the way, I'm preparing a major posting on
this erstwhile "best and brightest" claim, hopefully ready after this
very busy week is over.)

Now for item (b):

Vivek was outraged that Ron flatly stated that the Bank of American was
using H-1Bs as cheap labor.  But Ron was correct.  The Bank of America
is not the poor, genius-deprived firm the lobbyists describe.  On the
contrary, the BofA has an awful track record regarding the H-1B and L-1
visas (which, as Ron's research has shown and has been admitted by the
offshoring firms, is also used to facilitate offshoring):

1.  In 1997, the following report came out (Michael Liedtke, BofA Tech
Workers Fear Jobs Heading Off to India), Contra Costa Times} (East San
Francisco Bay Area newspaper), April 27, 1997.

#  Bank of America's technology center is in the early stages of an
#  unsettling cost-cutting experiment.  The San Francisco-based bank is
#  asking its computer engineers in Concord to undermine their own job
#  security by helping to train potential replacment workers imported from
#  India before shipping an untold number of positions overseas...
 
#  The bank also maintains none of its Concord emloyees will be dropped
#  from the payroll if the pilot program with the India workers proves to
#  be a success.

That latter statement by the bank proved to be false.  After completion
of the outsourcing program, the bank did indeed lay off its IT workers
in Concord and elsewhere in 2002 (Jim Gardner, Bank job: You're Fired,
Now Go Train Your Replacement, San Francisco Business Times, November
22, 2002):

#  Spreading some pre-holiday cheer, Bank of America this week announced
#  that it is cutting 900 tech positions---with the twist that some layoff
#  victims have to help train replacements if they want to get severance
#  pay...
 
#  The  job  cuts,  232  of them in the Bay Area, come as BofA is
#  outsourcing an increasing amount of tech work abroad, particularly to
#  India. That has earned the  Charlotte,  N.C.-based  institution  the
#  nickname of Bank of India among disgruntled soon-to-be-ex-employees.
 
#  Sure  enough,  dozens  of Indian tech workers have been visiting BofA's
#  major tech  centers  in  Concord,  Jacksonville,  Fla., and other cities
#  around the country  recently.  They're  getting training on work they'll
#  do back at home for about half what departing employees are paid. The
#  bank confirms that some laid-off  workers are being required to help
#  train new ones (and not speak to the media) as a condition of receiving
#  severance.

Sadly, this also led to tragedy (http://www.engology.com/BobFlanagan.htm).

2.  The BofA did the same thing in Charlotte, converting jobs from BofA
to HCL (an outsourcing firm).  The workers were still working AT the
BofA, but technically not FOR the BofA--and soon afterward, they weren't
working at all, because HCL replaced them with H-1Bs for literally half
their salaries.  This is detailed in the excellent case study by the
Programmers Guild, titled, "How to Underpay an H-1B," at
http://www.programmersguild.org/archives/howtounderpay.htm

In short, the industry lobbyists blew it big time by using the Bank of
America as their poster child.

By the way, CNBC repeatedly used the term "foreign-born" to describe the
foreign workers, giving viewers the impression that they are immigrants.
This is false.  These workers are merely SEEKERS of a TEMPORARY WORK
VISA.  Even if they do get that visa, it is, in immigration legal
terminology, a NON-IMMIGRANT VISA.  The employers can, either
simultaneously or later on, sponsor them for green cards, so some of
these workers may hope to become immigrants later on, but they are not
immigrants. 

Having studied the industry lobbyists for so long, I know that they
choose no word carelessly.  PR people want every word to have an effect,
with the term "foreign-born" intended to misleadingly connote immigrants
here, just like they insert the term "innovation" into the dialogue as
often as possible to misleadingly convey the idea that H-1Bs are needed
to innovate the U.S. out of its economic slump.  The frequent use of
the word "xenophobia" is deliberate too, for obvious reasons.

Anyway, there you have it.  CNBC, with its in-your-face style, baited
Vivek into an embarrassing televised tiff with someone who he actually
agrees with.  Some of you may be saying now that Vivek ought to
apologize to Ron, but my own view is that CNBC ought to apologize to its
audience.

Norm