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26–768 PDF








MARCH 30, 2006

Serial No. 109–95

Printed for the use of the Committee on the Judiciary
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Available via the World Wide Web: http://judiciary.house.gov


F. JAMES SENSENBRENNER, Jr., Wisconsin, Chairman
HENRY J. HYDE, Illinois
HOWARD COBLE, North Carolina
BOB INGLIS, South Carolina
MARK GREEN, Wisconsin
DARRELL ISSA, California
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JOHN CONYERS, Jr., Michigan
HOWARD L. BERMAN, California
MELVIN L. WATT, North Carolina
ZOE LOFGREN, California
MARTIN T. MEEHAN, Massachusetts
WILLIAM D. DELAHUNT, Massachusetts
ADAM B. SCHIFF, California
LINDA T. SÁNCHEZ, California

PHILIP G. KIKO, General Counsel-Chief of Staff
PERRY H. APELBAUM, Minority Chief Counsel

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Subcommittee on Immigration, Border Security, and Claims

JOHN N. HOSTETTLER, Indiana, Chairman

BOB INGLIS, South Carolina
DARRELL ISSA, California

HOWARD L. BERMAN, California
ZOE LOFGREN, California
LINDA T. SÁNCHEZ, California
MARTIN T. MEEHAN, Massachusetts

CINDY BLACKSTON, Professional Staff
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NOLAN RAPPAPORT, Minority Counsel


MARCH 30, 2006

    The Honorable Steve King, a Representative in Congress from the State of Iowa, and Member, Subcommittee on Immigration, Border Security, and Claims

    The Honorable Sheila Jackson Lee, a Representative in Congress from the State of Texas, and Ranking Member, Subcommittee on Immigration, Border Security, and Claims


Mr. John M. Miano, Chief Engineer, Colosseum Builders, Inc.
Oral Testimony
Prepared Statement

Mr. Stuart Anderson, Executive Director, National Foundation for American Policy
Oral Testimony
Prepared Statement

Mr. David Huber, Information Technology Professional, Chicago, IL
Oral Testimony
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Prepared Statement

Dr. Delbert Baker, President, Oakwood College
Oral Testimony
Prepared Statement


    The Honorable Maxine Waters, a Representative in Congress from the State of California


Material Submitted for the Hearing Record

    Prepared Statement of the Honorable Sheila Jackson Lee, a Representative in Congress from the State of Texas, and Ranking Member, Subcommittee on Immigration, Border Security, and Claims

    Mr. Ralph Hellman, Senior Vice President, Information Technology Industry Council

    Mr. Dan DeBoer, Information Technology Professional, Lisle, Illinois

    Mr. John A. Bauman, President, The Organization for the Rights of American Workers
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    Mr. Robert W. Holleyman, III, President and CEO, Business Software Alliance

    Mr. Darrell L. Rauthburn, Information Technology Professional, Columbus, Ohio

    Mr. John Palafoutas, Senior Vice President, AeA

    Ms. Linda Evans, Matthews, North Carolina

    Mr. Billy Reed, Past President, American Engineering Association

    Mr. John William Templeton, Coalition for Fair Employment in High Technology

    Mr. Michael Emmons, Information Technology Professional, Longwood, Florida

    Ms. Esther Massimini, Principal Engineer, Aerospace Electronics Honeywell

    Mr. Henry G. Huestis, Electrical Engineer, Spokane Valley, Washington

    Mr. Michael W. Gildea, Executive Director, Department for Professional Employees, AFL-CIO

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    Mr. Mark A. Powell, Information Technology Professional, Westminster, California

    Ms. Lynn Shotwell, Executive Director, American Council on International Personnel

    Ms. Sandra J. Boyd, Chair, Compete America

    The Institute of Electrical & Electronics Engineers - United States of America

    Ms. Toni L. Chester, Software Developer, Bloomsbury, New Jersey

    Shahid Sheikh

    Letter from Mr. Jack Krumholtz, Microsoft Corporation



House of Representatives,
Subcommittee on Immigration,
Border Security, and Claims,
Committee on the Judiciary,
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Washington, DC.

    The Subcommittee met, pursuant to notice, at 9:05 a.m., in Room 2141, Rayburn House Office Building, the Honorable Steve King (acting Chair of the Subcommittee) presiding.

    Mr. KING. Good morning.

    I'd like to make an announcement that Chairman Hostettler is not able to be here this morning, and so I'll be chairing this Subcommittee meeting.

    And in the interest of expediency, before we move on to the open part of the hearing and the opening statements by the other Members, I'd like to break from established protocol and recognize Ms. Jackson Lee for an opening statement because she has an urgent schedule to meet. And I'm very grateful—very happy to be able to do that.

    Ms. Jackson Lee, you are recognized for your opening statement.

    Ms. JACKSON LEE. Mr. Chairman, I thank you so very much.

    Mr. Chairman, I thank you so very much, and it's an honor and pleasure to serve as the Ranking Member of this Subcommittee and to welcome all of the witnesses for a very important hearing.

    Please do not in any way take my absence as an indication of the—of any lack of interest or importance of this hearing. Unfortunately, a scheduled event that required my presence was unavoidable, in essence, in terms of the timing that it had to occur.
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    But I do want to emphasize the importance of this hearing very quickly and to say that there are several themes that I think are integrated in this particular hearing, Mr. Chairman.

    One, this is an affirmation of legal immigration, and we are in the midst of a debate about immigration. The emotions are high. There is a great deal of tenseness. I'd almost call for a timeout.

    But this is a hearing about H-1B visas, which tend to focus on needed profiles of employees that American companies represent that they need to the United States. I've lived through this debate for any number of years, writing legislation with Representative Lamar Smith that I thought was very balanced, that had to do with providing visas, but also emphasized American workers. Training American workers, providing American workers with their opportunity.

    And so, this morning, I want to, again, emphasize that this program is allowing American employers, if they didn't have this, would not be able to hire enough highly educated professionals for the specialty occupations. And a specialty occupation is employment requiring the theoretical and practical application of a body of highly specialized knowledge. This may include doctors, engineers, professors, researchers in a wide variety of fields, accountants, medical personnel, and computer scientists, and software writers.

    Besides using the H-1B program to obtain foreign professionals who have skills and knowledge that are in short supply in this country, U.S. businesses use the program to alleviate temporary shortages of U.S. professionals in specific occupations and to acquire special expertise in overseas trends and issues—with expertise in overseas economic trends and issues. This helps U.S. businesses to compete in global markets.
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    As an American employer who wants to bring an H-1B employee to the United States, among other requirements, they must attest that he will pay the H-1B employee the greater of the actual compensation paid to other employees in the same job or the prevailing compensation for that occupation. That was in place so that we would not have lower wages for foreign workers, thereby not hiring American workers. That he will provide working conditions for the non-immigrant that will not cause the working conditions of the other employees to adversely be affected, and that there is no applicable strike or lockout.

    The employer must provide a copy of the attestation to the representative of the employee bargaining unit. Additional attestation requirements for the recruitment and layoff protections are imposed on firms that are H-1B dependent. A company is considered H-1B dependent if 15 percent or more of its employees are H-1B workers.

    These are the hard questions that we need to ask, is whether or not a company that asks for an H-1B truly needs an H-1B? Whether or not there are American workers that could be recruited, American college students that could be trained?

    The subject of this hearing is the cap for H-1B visas. The Immigration Act of 1990 set a numerical limit of 65,000 on the number of H-1B visas that can be used annually. In FY 2004, the 65,000 limit was reached in mid February. On October 1, 2004, United States Citizenship and Immigration Services announced that they had already reached the 2005 cap. The FY 2006 cap was reached in 2005, which is even earlier.

    The question becomes where are the American workers that could fill these jobs, and as well, how do we assist these companies who are now asking for an increased cap?
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    I know that the American companies can be more aggressive in recruiting American employees, particularly at the minority college campuses. And I also think that more can be done to retrain American workers who are being phased out of the high-tech industry when new technology is developed.

    But these measures themselves are not likely to eliminate, Mr. Chairman, the need for raising the H-1B cap. The cap is preventing U.S. businesses from meeting their specialty occupation needs, and the needs are likely to increase.

    How do we bring together the synergism and need for employment in the United States, the outreach to the Hispanic-serving, the historically Black colleges, and the needs, Mr. Chairman, of the specialty visas? And how do we reaffirm, if you will, legal immigration alongside of the rising debate of addressing the important question of regularizing, if you will—regularizing those who are undocumented?

    Again, we cannot leave that debate out of this question—border security and regularizing of 11 and 12 million. But today, we address the question that deals with these particular H-1B visas. And I view an increase in the cap as a short-term solution to a long-term problem.

    Foreign students represent half of the U.S. graduate school enrollments in engineering, math, and computer science. It is my commitment, Mr. Chairman, to work with the panelists, to work with our witnesses to be able to address the questions of our specialty visas and our technology industry, but also emphasize American workers, historically Black colleges, Hispanic-serving colleges.
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    And I'd ask the entirety of my application—excuse me, I'm not applying—my entirety of my statement be put into the record.

    And might I just close, Mr. Chairman, by indicating that you will have many outstanding witnesses, but I'm so delighted that the Congress of the United States is wise enough to secure a witness who is president of a college.

    Dr. Baker is president of Oakwood College, and I wanted the privilege of just slightly saying that he is a B.A. and Ph.D., but he has been working on what we call a ''millennium project,'' in edifying his university, his college to be more technologically sophisticated, training young people. And he's also a partner with NASA in Huntsville, Alabama.

    I'm very delighted. You will, of course, introduce him more extensively. But I'm very delighted of your presence here today, and I think you'll be a vital, an enormously vital component to how we deal with H-1B specialty visas and your testimony, along with your other witnesses.

    [The prepared statement of Ms. Jackson Lee follows in the Appendix]

    Ms. JACKSON LEE. Mr. Chairman, I would also unanimous consent that a letter from the Information Technology Industry Council, signed by Mr. Ralph Hellman, senior vice president, Information Technology Industry Council, that speaks to the need of H-1B visas, I ask unanimous consent to extend or to submit this into the record.

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    Mr. KING. Without objection.

    Ms. JACKSON LEE. Your courtesies have been most appreciated. Thank you very much.

    [The letter from Mr. Hellman follows in the Appendix]

    Mr. KING. Thank you, the gentlelady from Texas. And safe travels.

    I will now recognize myself for an opening statement.

    And good morning. Since 1990, Congress has limited the number of visas granted through the H-1B program to non-immigrants in specialty occupations. Since then, we have attempted to carefully balance the needs of our labor market for these skilled foreign workers with adequate protections for the jobs and wages of U.S. workers.

    Today, we have the opportunity to examine whether the current statutory cap is helping us to achieve this balance.

    The H-1B program is available to employers that petition for a temporary employee in a specialty occupation. The visa is valid for an initial period of 3 years. It may be renewed once for an additional 3 years. In recent years, the most frequent use of an H-1B visa is for computer and engineering-related jobs.

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    Currently, H-1B visas are capped at 65,000 per year. And during the tech boom of the '90's, Congress raised the cap to 195,000, but then allowed the cap to revert back to 65,000, as economic conditions worsened and many high-tech workers were facing layoffs.

    As economic conditions have improved, the numerical limit for H-1B visas has been reached very early in the fiscal year. For fiscal year 2005, the limit was reached on the first day of the fiscal year, and that was October 1, 2005. For fiscal year 2006, the U.S. Citizenship and Immigration Services announced that it had received enough applications to hit the cap on August 12, 2005. On April 1st—and that's this week—the U.S. CIS will begin accepting petitions for fiscal year 2007.

    Congress provided additional visas in the 2004 omnibus appropriations legislation by exempting 20,000 individuals with a graduate degree from a U.S. university from the H-1B cap. These additional visas were used within the first few months of the fiscal year. And even with a lower cap, we often hear stories of U.S. workers being laid off, replaced by foreign workers on H-1B visas.

    Today, we have the opportunity to hear from such a person, David Huber, about his devastating experience being laid off and replaced by a foreign worker on an H-1B visa.

    Also distributing—also disturbing are the numerous accounts of experienced computer programmers and engineers who are unable to find good-paying jobs.

    As an American, I believe that we must take measures to ensure that employers first look to Americans to fill these positions. This raises serious questions as to whether the H-1B program is working as intended or whether it is, in fact, detrimental to American citizens looking for work in these specialized fields.
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    Currently, only H-1B dependent employers and those with past labor law violations are required to certify that they have attempted to recruit a U.S. worker and that they have not displaced a U.S. worker. Perhaps Congress should consider requiring all employers to make these certifications. We should not have a visa program that allows an employer to lay off U.S. workers in favor of cheaper foreign labor.

    I recognize, however, that there are legitimate uses for the H-1B visa. The high-tech industry frequently hires individuals with advanced degrees in engineering and computer sciences. Many large companies recruit at major U.S. universities, but note that the majority of students in these programs are foreign nationals.

    Congress has attempted to address the perceived shortage of U.S. students in math, science, and engineering programs by diverting a portion of the H-1B fees charged to employers to educational programs for U.S. workers. Nonetheless, the high-tech industry submits that visas are needed to keep these individuals in the U.S. to work.

    To remain competitive as a nation, we must continue to encourage younger Americans into entering the math, science, and engineering fields. However, we must also be careful of getting into the unfortunate situation where once these students graduate, they cannot find a job.

    When college science and engineering grads complain of hard times landing jobs, enrollment in these college programs drops. That has certainly happened since the enrollment boom of the years of the dot-com bubble. We must not betray American students by encouraging them to enter into a tough major for the good of their country and then offer their job to a foreign student once they graduate.
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    I look forward to hearing from our witnesses today.

    [The prepared statement of Mr. King follows:]

    Mr. KING. I'm not recognizing any Members currently present that might want to give an opening statement. We'll accept those statements into the record. And without objection, all Members' statements will be made a part of the record at this time, and I'd like to turn to the introduction of the members of our panel.

    [The statements of Members follow:]


    Mr. Chairman, Madame Ranking Member, thank you for holding this hearing. The question of whether Congress should raise the cap for this special class of visas is a very timely one, given the current debate in America about how to address the volatile situation within the country and at our borders. The Administration must exercise extreme prudence and judgment in proposing an answer to this question.

    When the Government cuts some $12 billion in federal student education aid funds here in America with legislation that the House considers right now and this week, H.R. 609, the College Access and Opportunity Act of 2005, it raises eyebrows when it then asks the question of whether the limit on the number of specialty occupation visas should be raised. Perhaps if we handled education funding in a consistent and conscientious fashion, we would not be in the current conundrum.
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    I feel that we need to address our own policies that affect the amount of resources - human and monetary, available to fill our workforce needs before we change our immigration policy relative to allowing additional specialty workers.

    Thank you, witnesses, for your time, and thank you to the Chairman and Ranking Member for their efforts. I yield back.

    Mr. KING. First member of our panel, Mr. John M. Miano, chief engineer, Colosseum Builders, Inc. John Miano, the founding chairman of the Programmers Guild and currently serves as a director of that organization. He currently operates his own computer consulting firm, Colosseum Builders, Inc., in Summit, New Jersey.

    Mr. Miano is an expert in computer science, having 18 years of experience in computer software development. He holds a degree in mathematics from the College of Wooster and a juris doctor from Seton Hall University. He has published numerous articles and two books on computer programming.

    Mr. Stuart Anderson, the executive director of the National Foundation for American Policy. In January 2003, Stuart Anderson began his service at the National Foundation for American Policy in Arlington, Virginia, where he is currently the executive director. Stuart Anderson has extensive experience in immigration policy. He began his work on immigration at the Cato Institute in Washington, D.C., where he was director of the trade and immigration studies.

    He then spent 4 1/2 years on the Senate Immigration Subcommittee, serving as staff director of that Subcommittee under Senator Sam Brownback. Upon leaving the Subcommittee in August 2001, Mr. Anderson served as execute associate commissioner for policy and planning and counselor to the commissioner at the Immigration and Naturalization Services. He's published articles in the Wall Street Journal, New York Times, Los Angeles Times, among other publications.
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    Mr. David Huber, information technology professional. David Huber is currently working on a network architecture team, designing a new computing data center. He has over 15 years of IT experience, focusing on—focusing on complex networking deployments and network management operations.

    He has been directly responsible for $1.4 billion in technology investments and business operations. Mr. Huber was the LAN/WAN lead network engineer for NASA's X-33 space shuttle project at Edwards Air Force Base. He holds a bachelor of arts degree from the University of Chicago.

    And Dr. Delbert W. Baker, president of Oakwood College. Dr. Delbert Baker became president of his alma mater, Oakwood College, in November 1996, where he remains to this day. Prior to his return to Oakwood College, Dr. Baker served in numerous positions at Loma Linda University in Loma Linda, California. He was a professor, the deputy, the director of diversity, and special assistant to the president of the university.

    Dr. Baker is the author of numerous scholarly articles and seven books. He currently serves on many boards nationally and locally in Huntsville, Alabama, and has received awards from numerous organizations, such as the United Negro College Fund and Oakwood College, which named him ''Alumnus of the Year.''

    It is a practice here to swear the witnesses in. Please stand and raise your right hand.

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    [Witnesses sworn.]

    Mr. KING. Let the record show these witnesses responded in the affirmative. Say ''I do.'' The witnesses have been sworn in. Thank you.

    We'll now turn to the testimony from our panel. Without objection, your full written testimony will be made as part of the record. And if you can contain your comments to the 5 minutes, we'll be most appreciative so we can get questions from the Members of the Committee.

    I'll remind our witnesses that we have a series of lights, and the time for those lights until you see the red light is about a 5-minute period. And we'll be lenient here on the 5-minute period and allow you to complete your thoughts at least. And as long as we don't abuse the privilege, we'll be able to get this message to this panel.

    So, at this time, I'd like to recognize Mr. Miano for 5 minutes. Mr. Miano.


    Mr. MIANO. Thank you, Mr. Chairman.

    Imagine a father saying to his child on a Friday morning, ''Son, I know you have a big weekend coming up. So here's 50 bucks. Go out and have a good time.''
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    The next morning, the son comes back to his father and says, ''Hey, Dad, I used up all of the money you gave me. Can you give me some more?''

    Now what does the irresponsible parent do? He gives the kid another 50 bucks. But what does the responsible parent do? He asks, ''Son, what did you do with the 50 bucks I gave you already?''

    Now the question before this Committee is, ''Should Congress raise the H-1B quota?'' But in order to get to that point, Congress really needs to ask, ''Where did all the visas go?''

    Now, in law school, I started to examine labor condition applications in detail for H-1B workers. And from this research, I can tell you what the available data says about where the visas are going.

    First of all, from the LCAs, we get an idea of what types of companies are getting the visas. The spin on the H-1B program is that the beneficiaries are U.S. technology companies, but the LCA data show something entirely different.

    According to the LCAs, very few H-1B workers go to United States technology leaders, and instead, the LCA data suggest that the overwhelming majority of H-1B workers are going to body shops—these are companies that specialize in contracting workers out to other companies—and companies, especially foreign companies, that specialize in moving computer work overseas.
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    From the LCA data, we can also get an idea of the types of workers that are getting H-1B visas. The spin on the H-1B program is that it's for highly skilled labor. The LCA data suggests low skills and low wages.

    The LCAs, for example, give us a very good picture of employer prevailing wage claims. For computer programming, the employer prevailing wage claims on LCAs average $18,000 a year below the U.S. median wage for the occupation and location. And the wages listed on LCAs average $13,000 below the median U.S. wages.

    These extremely low wages—wage claims suggest most H-1B workers possess low skills. And this year, we have additional evidence of that. In matching prevailing wage claims using the four skill levels mandated by Congress, I found that employers claimed the majority of these workers were entry level, the very lowest skill level in the system.

    We are told that employers need H-1B workers because U.S. workers do not have the skills industry needs. Yet employers say most of these workers are in need of training. Again, the question before this Committee is, ''Should the H-1B quota be increased?'' And quite simply, the answer is no.

    The quota is the only thing that stands between the H-1B program and total chaos. Loopholes in the law allow U.S. workers to be replaced with H-1B workers. The prevailing wage system is a complete sham. The law limits enforcement to ensure most violators will not be punished. As meager as it is, the quota is the only real protection for U.S. workers that exists in the H-1B program.
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    In 1998 and 2000, industry said they only needed a temporary increase in the H-1B quota. If they were given a breather, they said they'd be able to train U.S. workers, they'd be able to hire women for technology jobs, they'd be able to hire minorities for technology jobs. Instead of being temporary, the increased quotas created permanent dependency on the H-1B program, and the H-1B program has become the engine driving the off-shoring of U.S. technology jobs to foreign countries.

    And I have to wonder why Congress has felt the need to exercise Stalinist control over the labor market. If a labor shortage really existed, the free market would take care of it.

    I have many more details in my written statement and would be happy to answer any of your questions.

    Thank you, Mr. Chairman.

    [The prepared statement of Mr. Miano follows:]




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    Mr. KING. Thank you, Mr. Miano.

    And now the Chair will recognize Mr. Anderson for 5 minutes.


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    Mr. ANDERSON. Thank you, Mr. Chairman.

    Despite the tremendous changes—excuse me—in the world economy, with modest exceptions, the U.S. immigration system for highly skilled professionals has not changed since 1990, except that it has become worse. Companies now pay hefty fees, endure longer waits, and submit to more regulation than in the past.

    American companies and their competitors are waging a global battle for talent, a battle complicated by the 65,000 limit on H-1B visas that annually leaves companies waiting months to hire key personnel while they risk losing top people to foreign competitors.

    Processing delays and a 5-year backlog because of inadequate employment-based immigration quotas make it impossible to hire an individual directly on a green card. Therefore, without sufficient H-1B visas, skilled foreign nationals and international students simply could not work or remain in the United States.

    The stakes are high. Nearly half of all engineers, physicists, and computer scientists with Ph.D.'s in the U.S. today are foreign born. As we know, many talented people in this world were not born in the United States. Whether it is the father of modern computing John von Neumann, founder of Intel Andrew Grove, Internet godfather Tim Berners-Lee, or many others, America's openness to talented individuals, regardless of their place of birth, has been our great strength.

    Here's what companies find when they recruit on college campuses. In 2005, U.S. universities awarded 55 percent of master's degrees and 67 percent of Ph.D.'s in electrical engineering to foreign nationals. At Iowa State, University of Texas at Austin, and other schools listed in the testimony, one-half to one-third of all graduate students in computer science and electrical engineering are foreign nationals.
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    Do we want to educate these individuals and send them out of the country to compete against U.S. firms? Or wouldn't it be better to allow these talented people to stay and create jobs and innovation here in America?

    The use of H-1B visas has been determined by the market. As the table in the testimony illustrates, when Congress raised the limit to 195,000 in 2002 and 2003, in both years, fewer than 80,000 visas were issued against the cap, leaving more than 230,000 unused.

    To avoid creating backlogs and long hiring delays, we should return to the 195,000 cap and have expanded exemptions for international graduate students, as in the pending Senate bill, which also includes necessary increases in employment-based immigration quotas.

    In 1998, Congress sought a balance by increasing the H-1B cap and imposing new enforcement measures and a new $500 training and scholarship fee, later raised to $1,500. Since then, employers have paid more than $1 billion in these fees, which have funded math and science scholarships for 40,000 U.S. students, hands-on science programs for 75,000 middle and high school students, and job training for more than 82,000 U.S. workers.

    Here's a quick response to criticisms of H-1B visas. First, the National Science Foundation and other sources show foreign-born scientists and engineers are paid as much or more as their native counterparts.

    Second, H-1B professionals change jobs all the time and simply don't stay if they can gain higher pay elsewhere.
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    Third, if U.S. companies hire based only on wages, then they would move all of their work outside of the United States since it costs $60,000 for a software engineer in Boston and only $7,200 for one in Bangalore.

    Fourth, foreign-born individuals are hired in addition to, not instead of native-born workers. They represent no more than 5 to 10 percent at most large high-tech firms.

    Finally, one cannot conclude employers underpay H-1B visa holders based on prevailing wage data, since what an employer pays is actually contained on the I-129 form filed with the Immigration Service, and research shows the actual wages that firms pay, as required under the law, is much higher than the prevailing wage.

    The costs of Congress failing to increase both the H-1B cap and employment-based immigrant quotas, unfortunately, will be measured by the job creation, innovation, and research that do not take place in the United States. And these costs will be felt beyond the immediate future.

    At the 2004 Intel Science Talent Search competition, the Nation's premier science competition for top high school students, I conducted interviews to determine the immigration background of the 40 finalists. Listen to what I found.

    Two-thirds of the Intel Science Talent Search finalists were the children of immigrants. And even though new H-1B professionals each year represent only 0.03 percent of the U.S. population, more of the children have parents who entered the country on H-1B visas than had parents born in the United States.
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    In other words, if critics had their way, most of the coming generation's top scientists would not be here in the United States today because we never would have allowed in their parents.

    Thank you.

    [The prepared statement of Mr. Anderson follows:]


    Mr. Chairman, thank you for the opportunity to testify today.

    U.S. companies and their competitors are waging a global battle for talent. American companies hire and recruit globally. In some cases, this means hiring foreign-born individuals on H-1B temporary visas, many times off U.S. college campuses as part of the normal recruitment process. Some assert the only reason U.S. employers would hire H-1B professionals is because they would work more cheaply than Americans. But this fails to grasp that international students form a majority of graduate students in science and engineering on many college campuses. Moreover, as Members of the Committee know well, there are many talented people in this world who were not fortunate enough to be born in the United States.

    Whether it is the father of modern computing John von Neumann, founder of Intel Andrew Grove, Internet godfather Tim Berners-Lee or countless others, America's openness to talented individuals—regardless of their place of birth—has been our great strength.
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    In 2005, U.S. universities awarded 55 percent of Masters degrees and 67 percent of PhDs in electrical engineering to foreign nationals, according to the American Association of Engineering Societies.

    Below is the percentage of foreign nationals enrolled among full-time students in graduate programs at universities of interest to Members of the subcommittee:

    Indiana University: computer science (63% foreign); electrical engineering (71%).

    University of Texas at Austin: computer science (67%); electrical engineering (76%).

    Iowa State: computer science (73%); electrical engineering (72%).

    Rice University: computer science (67%); electrical engineering (56%).

    University of Virginia: computer science (55%); electrical engineering (64%).

    University of Southern California: computer science (80%); electrical engineering (78%).

    Stanford University: computer science (41%); electrical engineering (63%).
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    University of Arizona: computer science (57%); electrical engineering (86%).

    University of Massachusetts: computer science (50%); electrical engineering (68%). (Source: National Science Foundation)

    Do we want to educate these individuals and send them out of the country to compete against U.S. firms, or wouldn't it be better to assimilate this talent and allow them to create jobs and innovations here in America?

    Since long regulatory delays and inadequate employment-based immigration quotas make it virtually impossible to hire an individual directly on a green card (permanent residence), the availability of H-1B visas is crucial, otherwise skilled foreign nationals, particularly graduates of U.S. universities, could not work or remain in the United States. It can take often four years or more for a U.S. employer to complete the process for sponsoring a skilled foreigner for permanent residence due to U.S. government processing times and numerical limitations. No employer or employee can wait four years for the start of a job. It is worth noting that America also gains considerably from foreign nationals educated outside the United States. Such individuals bring with them substantial human capital that America essentially receives without cost.

    The annual cap on H-1B professionals, first established in 1990, is inadequate. Since 1996, the 65,000 annual limit on H-1B visas has been reached in almost every year. This shortfall compels employers either to wait several months for the next fiscal year to employ prospective employees in the United States, to hire new people outside the country, or to lose them to foreign competitors. Many companies concede that the uncertainty created by Congress' inability to provide a reliable mechanism to promptly hire skilled professionals has led to placing more human resources outside the United States. In this respect, the H-1B limitations imposed by Congress are most damaging to young, fast-growing companies that do not possess the option of placing personnel overseas.
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    One such company is MagiQ Technologies in New York, selected by Scientific American as one of the nation's most innovative companies for its breakthroughs in quantum cryptography. Four H-1B visa holders work on products that help support the 20-person firm but international competition for top talent is brutal. ''We've lost the chance to hire top people in the field because of the H-1B cap being reached. That made it easier for our foreign competitors,'' said company CEO Robert Gelfond. He also notes that even when new hires are not lost, waiting several months for key personnel is expensive and can cost firms dearly in the marketplace.


    Despite the increased competition for talent and the tremendous changes in the U.S. and world economy over the past 16 years, with modest exceptions, the U.S. immigration system for high-skilled professionals has not changed since 1990—except that it has become worse. Companies now pay hefty fees, endure longer waits, and submit to more restrictive regulations than in the past.

    Prior to 1990, Congress placed no numerical limitation on the number of skilled foreign nationals employers could hire in H-1 temporary status. In the Immigration Act of 1990, Congress arbitrarily chose an annual cap of 65,000 and introduced several requirements in establishing a new H-1B category.

    It is clear that nobody considers the 65,000 annual limit on H-1Bs a sacrosanct number, as Congress has changed this limit at least three times in the past 8 years. In FY 2006, the immigration service stopped taking new H-1B applications in August 2005. Even the recently added 20,000 exemption from the H-1B cap for those who graduated with an advanced degree from a U.S. university was exhausted by January 2006.
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    As the table below shows, the market has determined the use of H-1B visas. When Congress raised the limit to 195,000 a year in FY 2002 and 2003, in both years fewer than 80,000 visas were issued against the cap, leaving 230,000 H-1B visas unused in those two years. Firms did not hire more H-1Bs just because the cap was higher.

    Any cap should be set high enough to avoid creating backlogs and long hiring delays. Returning to the 195,000 annual limit, with an uncapped exemption for graduates with an advanced degree from a U.S. university, would be a sensible policy. If the limit is lower than 195,000, the law should provide for increasing the ceiling by 20 percent following any year the annual cap is reached, as proposed in the Senate. Past legislation increased enforcement and taxed U.S. employers for each new H-1B professional hired, funding scholarships, science programs, job training, and anti-fraud activities. Having established this framework, the goal of new legislation should be to provide certainty for employers and prevent the nearly annual scramble in Congress to address H-1B visas.



    In 1998, Congress wanted to balance increased access to skilled H-1B professionals with greater educational and training opportunities for U.S. students and workers in science and engineering. The American Competitiveness and Workforce Improvement Act of 1998 (Public Law 105–277) established the H-1B Nonimmigrant Petitioner Account funded by a $500 fee (now $1,500) on each new petition (and the first renewal of H-1B status) for H-1Bs sponsored by U.S. companies.
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    Since 1999, employers have paid more than $1 billion in such fees. The money has provided National Science Foundation (NSF) scholarships for approximately 40,000 students. The amount of the scholarship has risen from $3,125 to $10,000. An early evaluation of the NSF scholarships conducted by the General Accounting Office (GAO) concluded: ''The program is attracting a higher proportion of women and minorities than are included among computer science, engineering, and mathematics degree awardees.'' The GAO also interviewed student recipients. ''One student told us that even though she excelled in math in high school, she only considered becoming a math major after she learned about the scholarship opportunity.''

    H-1B fees paid by employers also have funded hands-on science programs for middle and high school students, most notably Information Technology Experiences for Students and Teachers (ITEST) through the National Science Foundation. ''The ITEST portfolio consists of 53 local projects that allow students and teachers to work hand-in-hand with scientists and engineers on extended research projects, ranging from biotechnology to environmental resource management to programming and problem-solving.'' According to the National Science Foundation, ''ITEST impacts 75,000 students (grades 6–12), 3,000 teachers and 1,300 parent/caregivers.''

    More than 82,000 U.S. workers and professionals have completed training through programs funded by the H-1B fees as of December 31, 2005, according to the Department of Labor Employment and Training Administration. In addition, the Bush Administration recently has used the H-1B fees to provide multi-year grants to communities for training and economic revitalization. Through the WIRED (Workforce Innovation in Regional Economic Development) initiative, the U.S. Department of Labor is providing $195 million in grants to thirteen regional economies.
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    These totals do not include the impact of property taxes paid by U.S. companies, which are a key source of public school funding, nor do they include the individual efforts and donations made by American firms and entrepreneurs. For example, the Intel Corporation spends $100 million annually on math and science education in the United States. The Oracle Corporation donated $8.5 million in cash and $151 million worth of software to schools around the country in 2004. The Bill and Melinda Gates Foundation, funded from the sale of Microsoft stock by founder Bill Gates, has spent more than $2.6 billion since its inception on grants to improve education in the United States.

    In an important respect, Congress has not upheld its part of the deal made in 1998. At the time, employers received more than 100,000 H-1B visas a year for three years, while enduring new enforcement measures and the imposition of a $500 fee. Today, the enforcement measures have been made permanent and the fee has tripled to $1,500, plus a new $500 ''anti-fraud'' fee. Meanwhile, the H-1B cap has dropped back to 65,000, albeit with some exemptions.


    One argument made in the past against raising the H-1B cap is that foreign-born scientists and engineers may ''crowd out'' women and minorities seeking to enter these fields. Data from the National Science Foundation show this is not the case. Between 1980 and 2000, the share of black Americans in science and engineering occupations more than doubled from 2.6 percent to 6.9 percent, as did the share of women, from 11.6 percent to 24.7 percent. This happened at the same time that ''the percentage of foreign-born college graduates (including both U.S. and foreign degreed) in S&E jobs increased from 11.2 percent in 1980 to 19.3 percent in 2000,'' according to the National Science Foundation.
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    Some argue that the entry of H-1B visa holders harms some U.S. workers. This is a questionable assertion. Yet even if this were true, it would not justify preventing all American employers from gaining access to skilled foreign-born professionals in the United States or denying opportunity to these highly educated individuals, particularly international students who graduate from American universities. Leaving immigration aside for one moment, we know that the competition created by new businesses, new college graduates, new high school graduates, and imports of goods and services all may affect someone. But we do not try to block all of these because we have learned the cost of trying to prevent competition invariably far outweighs the benefit.

    It is a dim view of humanity to assume that opportunity for some must mean misery for others. I'll summarize responses to some of the criticisms of H-1B visas.

    First, the National Science Foundation and other sources show foreign-born scientists and engineers are paid as much or more as their native counterparts.

    Second, H-1B professionals change jobs all the time. This is confirmed by government data, employers, and attorneys. In fact, generally speaking, the majority of H-1B hires by large companies these days first worked for other employers.

    Third, the back wages owed to H-1B employees among the small number of employers whose actions warranted investigation and government-imposed penalties average less than $6,000 per employee, no more than the typical government and legal fees paid by most employers to hire H-1B visa holders. And among those employers, few if any are well-known companies. Generally, of the small number of violations no more than 10 to 15 percent of H-1B violations in a year are found to be ''willful'' by the Department of Labor, indicating the extent of abuse is limited.
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    Fourth, if companies simply wanted to obtain services based only on wages, then U.S. companies would move all of their work outside the United States, since the median salary for a computer software engineer is $7,273 in Bangalore and $5,244 in Bombay, compared to $60,000 in Boston and $65,000 in New York, according to the Seattle-based market research firm PayScale.

    Fifth, foreign-born individuals are hired in addition to—not instead of—native-born workers. The evidence indicates that native-born and foreign-born work together in companies all across America. In the nation's largest technology companies, typically no more than 5 to 10 percent of the employees work on H-1B visas at any one time. There are very few businesses with even a majority of workers in H-1B status and, indeed, any firm with more than 15 percent of its workforce made up of H-1Bs is subjected to more stringent labor rules under U.S. law.

    Finally, it is not possible to conclude employers underpay H-1B visa holders based on prevailing wage data filed with the Department of Labor. Under Section 212(n)(1) of the Immigration and Nationality Act, an employer hiring an individual in H-1B status must pay at least ''the actual wage level paid by the employer to all other individuals with similar experience and qualifications for the specific employment in question'' or ''the prevailing wage level for the occupational classification in the area of employment, whichever is greater . . .'' Therefore, any analysis that relies solely on prevailing wage data is inherently flawed.

    The wage data maintained by the Department of Labor are simply listings of the minimum an employer can pay an H-1B professional for a particular job. The data showing what an employer actually pays an H-1B visa holder are contained on the I-129 forms filed with U.S. Citizenship and Immigration Services (USCIS). Unlike the prevailing wage data at DOL, the forms filed with USCIS are not normally available to the public. To examine this issue, the National Foundation for American Policy asked a respected law firm to select a random sample of H-1B cases from among its client base. They represented different occupations but the vast majority of the H-1Bs were in high technology fields. Among the 100 randomly selected cases, the average actual wage was more than 22 percent higher than the prevailing wage. This is not meant to be definitive proof that actual wages are always, on average, 22 percent higher than prevailing wages. However, it does show, along with the other evidence, that any analysis utilizing prevailing wage data to claim H-1B professionals are underpaid is not reliable.
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    Critics make assertions about the wages of H-1B professionals not out of concern for the H-1B visa holders but because the critics believe the competition harms native workers. As noted, it is possible that a policy that results in increased competition can affect some people but remain good policy nonetheless. For example, a moratorium on opening new restaurants in an area would help existing restaurant owners and their employees but would be bad for consumers and entrepreneurs who live nearby, as well as workers seeking opportunity. For that reason such protectionist policies are rare in America and their rarity is a primary reason for America's economic success relative to other nations. (See William W. Lewis, The Power of Productivity, University of Chicago Press, 2004.)

    Still, there is little evidence that native information technology (IT) workers are harmed by an openness towards H-1B professionals. A study by Madeline Zavodny, a research economist at the Federal Reserve Bank of Atlanta, found, ''H-1B workers [also] do not appear to depress contemporaneous earnings growth.'' As to unemployment, the study concluded that the entry of H-1B computer programmers ''do not appear to have an adverse impact on contemporaneous unemployment rates.'' The study also noted that some results ''do suggest a positive relationship between the number of LCA [Labor Condition] applications and the unemployment rate a year later.'' Zavodny concluded: ''None of the results suggest that an influx of H-1Bs as proxied by Labor Condition Applications filed relative to total IT employment, lower contemporaneous average earnings. Indeed, many of the results indicate a positive, statistically significant relationship.'' This would mean H-1B employment is actually associated with better job conditions for natives, according to the study, which could be because H-1B professionals are complementary to native professionals.
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    Under the law, employers hiring H-1B professionals must pay the greater of the prevailing wage or ''the actual wage level paid by the employer to all other individuals with similar experience and qualifications for the specific employment in question.'' Employers sponsoring individuals for an employment-based immigrant visa must also pay employees at least the market wage.

    Research by Paul E. Harrington, associate director of the Center for Labor Market Studies at Northeastern University, shows foreign-born and native professionals earn virtually identical salaries in math and science fields. Salaries in computer or math sciences were actually higher for the foreign-born among bachelor degree holders and doctoral degree holders and the same for recipients of master's degrees. He found similar salaries for natives and foreign-born at all three levels in life sciences, as well as at the doctoral level in engineering, and a greater edge for natives at the bachelor and master's level for engineering.

    National Science Foundation data indicate that foreign-born professionals actually earn more than their native counterparts when controlled for age and the year a science or engineering undergraduate, master's, or doctorate degree is earned. The National Science Foundation reports: ''Because foreign-born individuals in the labor force who have S&E (science and engineering) degrees are somewhat younger on average than natives, controlling for age and years since degree moves their salary differentials in a positive direction—in this case, making an initial earnings advantage over natives even larger—to 6.7 percent for foreign-born individuals with S&E bachelor's degrees and to 7.8 percent for those with S&E PhDs.''
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    One way to obtain an upper-bound estimate of possible underpayment of wages to H-1B professionals is to examine Department of Labor (DOL) enforcement actions against employers. The evidence indicates that even among the highly stratified sample of the relatively small number of employers whose actions warranted investigation and government-imposed penalties (136 nationwide in 2004), the amount of back wages owed by even those employers is small. In fact, on average, it is no more than the typical government and legal fees paid by most employers to hire H-1B visa holders.

    Between 1992 and 2004, in all DOL investigations, the average amount of back wages owed to an H-1B employee was $5,919. While it is true that the Department of Labor's enforcement of H-1Bs is primarily complaint-driven (though Congress has provided a mechanism for self-initiated DOL investigations), it is telling that among the cases investigated relatively few violations have been found to be labeled ''willful'' and/or result in debarment. DOL found employers either committed paperwork violations or misread employer obligations in a non-willful manner in the vast majority of the investigations conducted. In FY 2004, DOL found willful violations in only 11 percent (15 of 136) of its investigations that became final.

    The violations typically found over the past dozen years rarely seem to be committed by any well-known companies. Of the $4.8 million owed in back wages in 2004, more than half (53 percent) came from findings against just 7 companies, none of whom are household names.

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    Under the law, U.S. employers are obligated to pay H-1B professionals the same wage as ''all other individuals with similar experience and qualifications for the specific employment in question.'' But unlike with a native-born worker, the hiring costs to an employer do not end with the acceptance of a job offer. To hire a foreign national on an H-1B visa a U.S. employer must incur the following costs: approximately $2,500 in legal fees; $1,500 training/scholarship fee; $1,000 ''premium processing'' fee (not required but routinely used to overcome long processing times); a new $500 antifraud fee; a $190 immigration service fee; around $125 in additional incidental costs (Federal Express, etc.), and a $100 visa fee. These combined costs total $5,915.

    While legal fees could be higher or lower depending on the law firm and the relationship with the employer, these figures do not include relocation costs, tax equalization, or additional in-house human resources costs associated with the extra work involved in employing foreign nationals. Nor do the costs include the expense of approximately $10,000 that can be incurred by sponsoring a foreign national for permanent residence (a green card), which many large technology companies, in particular, will do. Critics rarely take into account that companies incur many additional expenses beyond simply the wages paid to H-1B visa holders.


    While the Department of Labor is unlikely to catch all underpayment of wages, the greater protection for both H-1B professionals and other workers is the freedom to change employers and the competition for their services. A myth has been perpetuated that H-1B visa holders are ''indentured servants.'' This is far from the truth. A sampling of U.S. employers and immigration lawyers found that individuals on H-1B visas change companies frequently. A number of S&P 500 companies related that the majority of their H-1B hires first worked for other employers. Independent immigration attorneys confirmed this. H-1B visa holders are individuals who understand the marketplace, exchange information with others in the field, and are highly sought by employers. In fact, Congress made it easier for those in H-1B status to change jobs by allowing movement to another employer before all paperwork is completed.
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    Data from the Department of Homeland Security show that in FY 2003 more H-1B applications were approved for ''continuing'' employment than for initial employment. While continuing employment also includes H-1B professionals receiving an ''extension'' to stay at the same employer for an additional three years, anecdotal evidence indicates most ''continuing'' employment involves an H-1B visa holder changing to a new employer.

    Critics do not explain why H-1B professionals who are said to be underpaid would remain en masse with their employers when they could seek higher wages with competing firms. Some argue that H-1B visa holders sponsored for green cards are reluctant to change employers because they will lose their place in the queue for labor certification and permanent residence. To the extent this problem persists the solution is to:

1) Streamline the labor certification process (progress has been made via DOL's new PERM system).

2) Eliminate the labor certification backlog.

3) Allow premium processing (employers paying an extra fee) to speed green card processing at the immigration service.

4) Reduce the employment categories that require labor certification.

5) Expand the annual allotment of employment-based immigrant visas.

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    Major U.S. employers have supported such reforms, some of which were included in last year's Senate-passed budget bill, though the measures failed to become law by not surviving the reconciliation process with the House of Representatives.


    Two misconceptions about immigration and labor markets affect people's understanding of high-skilled migration. First, is the ''lump of labor'' fallacy, or the belief only a fixed number of jobs exist in an economy, which would mean that any new entrant to the labor market would compete with existing workers for the same limited number of jobs. As the Wall Street Journal (February 4, 2006) noted recently about the U.S. economy, since ''May of 2003, just under five million jobs have materialized. That is the equivalent of a new job for every worker in New Jersey.'' The number of jobs available in America is not a static number, nor is the amount of compensation paid to workers fixed. Both grow based on several factors, including labor force growth, technology, education, entrepreneurship, and research and development.

    Within sectors, jobs increase or decrease from year to year based on product demand and other factors. However, it is easy to ignore that people work today in companies and industries that did not even exist in the early 1990s. ''When I was involved in creating the first Internet browser in 1993, I can tell you how many Internet jobs there were, there were 200. I can tell you how many there are now, there's two million now,'' said Marc Andreessen, a founder of Netscape.

    Job creation is also worth considering. Indian and Chinese entrepreneurs have founded nearly one-third of Silicon Valley's technology companies, according to research by University of California, Berkeley professor Annalee Saxenian. Given our immigration system, one can surmise a majority entered on H-1B visas. She writes, ''Silicon Valley's new foreign-born entrepreneurs are highly educated professionals in dynamic and technologically sophisticated industries. And they have been extremely successful . . . By 2000, these companies collectively accounted for more than $19.5 billion in sales and 72,839 jobs.''
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    While nobody wishes anyone to lose a job, it is a common phenomenon in America, and one that cannot be blamed on H-1Bs, L-1s, or any other visa category. As Dallas Federal Reserve Bank economist W. Michael Cox and his colleague Richard Alm have explained, ''New Bureau of Labor Statistics data covering the past decade show that job losses seem as common as sport utility vehicles on the highways. Annual job loss ranged from a low of 27 million in 1993 to a high of 35.4 million in 2001. Even in 2000, when the unemployment rate hit its lowest point of the 1990's expansion, 33 million jobs were eliminated.'' Cox and Alm further note, ''The flip side is that, according to the labor bureau's figures, annual job gains ranged from 29.6 million in 1993 to 35.6 million in 1999. Day in and day out, workers quit their jobs or get fired, then move on to new positions. Companies start up, fail, downsize, upsize and fill the vacancies of those who left . . .'' (The New York Times, November 7, 2003) While it is understandable why individuals come before Congress and plead to prevent competition for their company or employment category, attempts to limit competition do far more harm than good, as we have seen in countries with highly regulated labor markets.


    Regardless of what action Congress takes on the H-1B visa cap, there will remain a glaring deficiency in U.S. immigration policy if no changes are made to the employment-based immigration quotas. Simply put, the current 140,000 annual quota for employment-based immigration is inadequate. The State Department's Visa Bulletin for April 2006 shows that an employer would have needed to submit an immigration application five years ago to obtain a green card today for a professional in the employment-based third-preference category. Visa numbers are current only for those who submitted their paperwork by May 2001 (and that wait is even longer for nationals of India). If Congress fails to address this issue, then the situation will grow worse each year.
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    To help ensure that outstanding international graduate students and other highly skilled individuals can stay to work in America, legislation in the Senate would increase the annual allotment of employment-based immigrant visas (green cards) and provide exemptions from the immigration quota for those with advanced degrees in science and engineering from U.S. universities who work three years in the United States prior to their application for adjustment of status. It also would provide greater flexibility for international graduate students in science and engineering seeking employment after graduation and would eliminate the requirement that such individuals must prove they will not stay or work in the United States when first applying for their student visa. This last provision would be a logical extension of the law Congress passed in 2004 to exempt up to 20,000 international graduate students from being counted against the annual limit on H-1B visas.

    If the annual depletion of H-1B visas or the lack of green cards in the employment categories cause international students to believe they will not be able to work in the United States, then many will stop coming and will seek opportunities elsewhere. That would be a significant blow to U.S. companies and innovation in science and technical fields.

    It is my understanding that some critics of H-1B visas favor at least some reforms aimed at increasing access to green cards for skilled professionals. Necessary reforms would include speeding or eliminating where possible labor certification. The Bush Administration can begin offering employers the option to pay an extra fee for quicker immigration processing—30 days, rather than the current long delays. Combined with quicker processing times for labor certification at the Department of Labor, this would allow U.S. employers to hire highly sought after individuals directly on green cards—something impossible to do today. The ability to hire high skilled personnel directly on green cards would provide U.S. companies with a significant competitive advantage over their foreign competitors. But Congress must increase the quota for employment-based immigrant visas for American firms to gain this competitive edge.
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    The costs of Congress failing to increase both the H-1B cap and employment-based immigrant quotas, unfortunately, will be measured by the job creation, innovation, and research that do not take place in the United States. And these costs will be felt beyond the immediate future.

    At the 2004 Intel Science Talent Search, the nation's premier science competition for top high school students, I conducted interviews to determine the immigration background of the 40 finalists. The results were astounding. Two-thirds of the Intel Science Talent Search finalists were the children of immigrants. And even though new H-1B visa holders each year represent only 0.03 percent of the U.S. population, it turns out more of the children (18) had parents who entered the country on H-1B visas than had parents born in the United States (16). In other words, if critics had their way, most of the coming generation's top scientists would not be here in the United States today—because we never would have allowed in their parents.

    Mr. KING. Thank you, Mr. Anderson.

    Now we'll recognize Mr. Huber for 5 minutes.


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    Mr. HUBER. Mr. Chairman, Members of the Committee, I am David Huber, an IT professional whose life has been devastated by the H-1B program.

    I am a University of Chicago graduate with more than 15 years of experience specializing in high-end complex networking deployments and network management operations. I have been directly responsible for about $1.4 billion in technology investments and/or related business operations.

    My professional training includes Ameritech carrier broadband technologies, Cisco networking, Sun UNIX server technologies, Microsoft server networking, Novell networking, and Cisco Voice over Internet training.

    I'm now working with a network architecture team on a new computing data center buildout project. When I graduated, savvy people told us that America needed a limitless supply of talented, innovative engineers for the emerging high-tech world. And for a while, it did.

    During the 1990's, I held a series of increasingly important and difficult jobs. In 1999, I was hired as a consultant to work as a lead LAN/WAN network engineer for NASA's X-33 space shuttle project at Edwards Air Force Base. These credentials show that I'm a highly qualified network engineer. When you discuss America's need for highly trained, innovative workers and thinkers, I am one of them. Or at least I was, until 2002.

    In mid 2002, I approached Bank One, now JPMorgan Chase, about working in network operations in Chicago. After receiving assurances I was within salary range for experienced technologists, a director told me that the job I was interested in paid about $30,000 less than what I had discussed with his colleague. I was totally perplexed by this sudden and unexpected reduction in wages.
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    I know now, by looking at their Labor Conditions Applications, that Bank One was hiring in mid 2002, just not hiring Americans. In 2002, Bank One received permission from the Department of Labor to hire 33 H-1B workers, 14 of whom were to work in Chicago, where I would have worked. These included jobs—these included jobs I was qualified to do.

    At about the same time I was offered a job for $30,000 less than market rates, Bank One was telling the U.S. Government that they could not find qualified Americans to do the type of work I was already doing. One year later, Bank One got the go-ahead from the DOL to hire 120 H-1B workers, again in jobs that I'm qualified to do.

    In May 2003, I was hired as a network consultant at ComEd, Chicago's utility company, to manage their communications network. This was not an entry-level position, but a senior-level network management position. Three months after being hired, I was replaced. My job and new positions were filled by visa workers.

    I met my replacement and helped train him. From talking to them, I learned that none of them were U.S. citizens, nor were they employed by ComEd. Two were from InSource Partners, a job shop located in Houston that specializes in placing foreign technical workers at American firms, including Bank One, where I had previously applied. One of the men confirmed that he had been hired for about one-third less than my salary.

    At both Bank One and ComEd, those hired were less qualified than I was. They had less experience and had never managed a project before. They also barely spoke English and lacked the business demeanor necessary for that level of responsibility.
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    The ability to communicate is an essential part of the work I did, and my replacements could not communicate. This does not disparage them as individuals. After all, my Mandarin is sort of lousy. But it does call into question the decision to replace me with them.

    When I hear companies complain that they can't find qualified Americans to fill high-tech jobs, I think of my replacements and wonder exactly what qualifications they are looking for.

    There is another, more troubling aspect to my experience at ComEd. Two of the three individuals who replaced me were from China. As part of my job, I had access to all the data communication switches that control the electrical grid for the Chicago area. Anyone with this access could shut down the entre telecom operations for the power company and possibly the power grid itself.

    It is very likely that my replacements will return to China, taking with them detailed knowledge about the inner workings of our electrical grid system. After the recent controversy over our ports, I can't believe that Congress thinks this is a good idea.

    I'm a highly qualified network administrator with decades of professional experience and skills that are as current as anyone in the country. Yet between the summer of 2002 and January 2006, I worked for about 6 1/2 months. After depleting my savings, I had to declare bankruptcy and was almost homeless.

    During the same time, Congress allowed companies to hire over 300,000 foreign workers on H-1B visas because companies claimed they could not find qualified Americans. I am here today to tell you that this claim is not true.
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    There are thousands of unemployed Americans with the skills, drive, and creativity needed to thrive in the current marketplace. I know because I was one. Yet too many of us cannot find jobs because companies are turning to H-1B workers as a first choice before even advertising positions to Americans.

    I would like to close by pointing out that the signers of the Declaration of Independence said that they would mutually pledge to each other their lives, their fortunes, and their sacred honor. The citizens of these United States are asking that the political and business leadership in this country live up to that pledge and not allow the lives and fortunes of their fellow American citizens to be compromised by these worker visa programs.

    Thank you for giving me an opportunity to be heard today and to share my story with you. I hope it will help you better understand the real H-1B program.

    [The prepared statement of Mr. Huber follows:]


    Mr. Chairman and distinguished members of the House Judiciary Committee's Subcommittee on Immigration, Border Security and Claims, my name is David Huber and I am an Information Technology Network Professional who has first-hand experience with the H-1B visa program. I am here, not as an expert on how the H-1B program is supposed to work. I am not an economist who can recite all of the benefits the H-1B program is supposed to be bringing to our country. Rather, I am here today as an American citizen and an engineer whose life has been devastated by that program.
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    Before I get to my experiences with the H-1B program, I want to give you some background about myself. I am a University of Chicago-educated IT professional with more than fifteen years of experience, specializing in high-end, complex networking deployments, and network management/operations. I have been hands-on, directly responsible for about $1.4 Billion in technology investments and business operations. Currently, I am working with a network architecture team on a new computing data center build-out project.

    In order to rise to this level in my chosen profession, I had to make tremendous short-term financial and time-intensive sacrifices to educate myself and prepare myself for the jobs of the future in our American economy that was changing into a knowledge-intensive, high-tech service economy. We all read about these changes and predictions throughout the 1970s and 1980s. I knew that if I wanted to be able to participate in such an economy, I would have to be college-educated, and be prepared to do a lifetime of constant learning.

    So, when I knew my parents didn't have the money to pay for my college, worked many jobs to put myself through college, including working as an UPS dockworker for six years. I went back to college at the University of Chicago, earning a BA in 1988. I worked one to three jobs while pursuing my degree, including several computing jobs at the University. I also worked extensively with pre-Web electronic publishing before moving into networking technologies. My professional training has included Ameritech carrier broadband technologies; Cisco networking; Sun UNIX server technologies; Microsoft server networking; Novell networking; EMC SAN/NAS training; Cisco Voice over Internet Protocol training.

    When I graduated, savvy people thought that working in high tech would be a certain ticket to prosperity. We were told that America needed a limitless supply of talented, innovative high-tech engineers for the emerging high-tech world. And for a while, it did.
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    During the 1990's I held several increasingly difficult and important jobs. In 1999 I was hired as a consultant to work as the lead LAN/WAN network engineer for NASA's X-33 space shuttle project (ground launch network) at Edwards Air Force Base. This was a joint $1 billion Skunkworks/NASA project which I took over and managed, successfully implementing a new IP addressing system to integrate the launch network with NASA's intranet. I am highlighting this to demonstrate that I was, and still am, among the top network engineers in the country. When you discuss America's need for highly-trained, highly-skilled innovative workers and thinkers, I am one of them. Or, at least I was until 2002.

    In early 2002, I approached Bank One (now JP Morgan Chase) about working in Network Operations or Planning in Chicago. After receiving assurances that I was within the salary range for experienced technologists, an HR director in Delaware told me that the job I was interested in paid about 30K less than what I had discussed with his colleague in Ohio. I was totally perplexed by this sudden and unexpected reduction in wages.

    It took me a year to find out why the Bank One job didn't work out. It turns out that the company had filled the position with a non-American worker, hired through a job-shop.

    I have since learned more about Bank One. The Labor Conditions Applications (LCAs) filed by the bank show that they were hiring in mid-2002, just not hiring American citizens. In 2002 Bank One received permission from the Department of Labor to hire 33 H-1B workers, 14 of whom were to work in Chicago where I would have worked. These included Technology Project Managers and Applications Development Analysts—jobs that I was, and am, qualified to do. At about the same time I was offered a job for $30,000 less than market rates, Bank One was telling the U.S. government that they could not find qualified Americans to do the type of work I was already doing.
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    One year later, Bank One got the go ahead from the Department of Labor to hire another 120 H-1B workers, most in technology positions, again in jobs that I am qualified to do. They still had my resume on file.

    In May 2003 I was hired as a network consultant at Commonwealth Edison, the power utility company responsible for the electrical grid covering most of the Chicago metropolitan area. I was hired to manage their communications network, including the systems in their headquarters in downtown Chicago. This was not an entry-level position, but a senior-level systems network management position.

    Three months after being hired, I was replaced. Com Ed brought in three new employees to run their network, replacing myself. I met my replacements and helped train one of them. I do not blame them for what happened.

    From talking to them, I learned that none of them were U.S. citizens. Nor were they employed by Com Ed. Two were from InSource Partners, a job shop located in Houston that specializes in placing foreign technical workers at American firms. One of them confirmed that the three had been hired for about one-third less than my salary.

    In both instances at Bank One and Com Ed those hired were less qualified than I was. They had less experience and had never managed a project before. They also barely spoke English and lacked the temperament and business demeanor necessary for that level of responsibility—not the sort of employees you would expect for jobs demanding creative problem solving and excellent communication skills.
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    Now, I want to be clear here—I do not think their lack of English skills made them bad people. In fact, I feel no ill-will towards any of them. Each just wanted to earn a living and build a life for himself and his family in America—something I understand completely.

    Nevertheless the ability to communicate is an essential part of the work I did—and my replacements could not communicate. This does not disparage them as individuals—after all, my Mandarin is lousy—but it does call into question the decision to replace me with them. When I hear companies complain that they can't find ''qualified'' Americans to fill high-tech jobs, I think of my replacements and wonder exactly what qualifications they are looking for. Mr. John Miano, who is also testifying here today, may have an answer to that question.

    There is another, more troubling aspect to my experience at Com Ed. Two of the three individuals who replaced me were from China. I do not care about their ethnicity. But I do think that it is noteworthy that two of these men were foreign nationals from a country that our military views as a threat.

    This is important because, as a part of my job, I had access to all of the data communication switches that control the electrical grid for the entire Chicago metropolitan area. This access gives one the ability to shut down the entire telecomm/data comm. operations for the power company, and possibly the power grid itself. I have to wonder about the wisdom of replacing American citizens with foreign nations in highly sensitive positions like this. It is very likely that my replacements returned to China after six years, taking with them detailed knowledge about the inner workings of our electrical grid system.
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    Why does Congress think this is a good idea?

    Between the summer of 2002 and January 2006, I had only worked for a total of about 6.5 months. I fully depleted my savings, and was nearly homeless on two or three occasions. On Thanksgiving 2004, I had an apple, baked beans and water for dinner. Since I could no longer afford my Cobra premiums, I am very fortunate I had no medical emergencies to contend with. Otherwise, I truly would have ended up being indigent.

    I am a highly-qualified network administrator with decades of professional experience and skills that are as current as anyone in the country. Yet for nearly three years, I was unemployable. During this period, Congress allowed companies to hire over 300,000 foreign workers on H-1B visas because companies claimed they could not find qualified Americans.

    I am here before you today to tell you that this claim is not true.

    There are thousands of unemployed Americans with the skills, drive and creativity to needed to thrive in the current marketplace. I know, because I was one. Yet too many of us cannot find jobs because companies are turning to H-1B workers as a first choice, before even advertising open positions to American workers. The H-1B program allows companies to hire 85,000 cheap, disposable workers each year before even looking for Americans.

    Companies can do this because current law does not require most H-1B employers to prove they can't find an American before using an H-1B. In fact, the law doesn't even require companies to look. Without a labor market test, companies can, and do, use the program to bypass local labor markets entirely and replace qualified Americans with less qualified foreign workers.
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    H-1B workers are allowed to stay in the United States for up to 6 years—but only if their employers permit them. Since the visas themselves are owned by the sponsoring companies, H-1B workers are often treated as indentured servant, dependent upon their employers' good graces to stay in our country.

    This is not just bad policy, it is also wrong. It is wrong for the Untied States to encourage talented people to come to the U.S. and then deny them access to the freedoms the rest of us enjoy. And it is wrong to force American workers to compete against such a program. The H-1B program tilts the playing field against workers, both American and foreign, in favor of companies.

    As the program functions now, companies have strong incentives to favor H-1B workers over American workers. They can and they do give hiring preference to non-Americans, and even replace qualified American workers with H-1B workers. I know because it happened to me twice.

    I urge Congress to take a hard look at how the H-1B program actually functions. I urge you to look at the types of jobs that are actually being filled with the visas. I urge you to look at the wage levels the Department of Labor routinely approves for H-1B positions. And I urge you to listen to workers like myself who have suffered economically as a result of H-1Bs.

    If you do, you will learn that the visa program is far different than the one described by its supporters. The real H-1B program has more to do with providing companies with cheap labor, and little to do with making America more competitive.
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    I would like to close by pointing out that the signers of the Declaration of Independence said that they would mutually pledge to each other, their lives, their fortunes, and their sacred honor.

    The Citizens of these United States are asking that the political and business leadership in this great country live up to that pledge, and not allow the lives and the fortunes of American Citizens to be compromised by these worker visa programs.

    Thank you for giving me an opportunity to be heard today and to share my story with you. I hope it will help you better understand the real H-1B program.

    Mr. KING. Thank you for your testimony, Mr. Huber.

    And now recognize Dr. Baker for 5 minutes.


    Mr. BAKER. Thank you.

    It is my privilege this morning to make some remarks concerning this very important topic. I was reflecting that last evening, I stayed at the Hilton, and our Vice President was there. And he—I saw his remarks on Fox News, and he spoke about a very humorous situation about some of the sensitive issues we're dealing with in Government.
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    I thought it was an interesting approach because even though this subject is fraught with so many heavy overtures, as was brought out earlier, there is an aspect to it that I think that we must look at in terms of dealing with young people and dealing with students and dealing with those who are disadvantaged. And that is the aspect of how can we get more people in the pipeline? The Congresswoman spoke about this. I want to reiterate this point.

    I am president of a historically Black college in Huntsville, Alabama. We're about 10 miles from Redstone Arsenal and Marshall Space Flight Center-NASA. We have a variety of collaborations with these institutions, these organizations.

    And I have noted that the word ''globalization'' and the whole issue of diversity is often misunderstood, and people have the wrong perception in many circles. It's not a four-letter word. It's a 13-letter word, if one counts the letters in it. And in fact, you will find that it can work to our advantage in so many different ways.

    I'm not speaking specifically to the issue of H-1B, being for it or against it. What I'm doing is bringing another component in, saying that there needs to be a complementary program that goes along with this particular program that is in operation.

    And that is the program is one that deliberately does a number of factors. Number one, without question, society needs to have understanding of not to fear the H-1B. Many people believe that all of our jobs and our well-being is threatened by this program.

    There needs to be a very clear, deliberate plan to educate the public through a variety of ways that this can help us when there is a shortage of jobs. At the same time, there must be controls put in place, as has been brought out earlier.
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    But beside that, there's also the aspect of not simply awareness, but there needs to be some training of our faculty, our staffs, business persons, community persons on how to facilitate the process of getting the underrepresented, those who are disadvantaged into the pipeline so we, in fact, can have people, Americans to fill these positions that right now, in many cases, we're having to go outside for.

    So there is the awareness, the training. There's also the recruiting. We have a number of—a variety of programs in effect right now with the National Science Foundation, with the Department of Defense, NASA, UNCF, SAIC. A variety of corporations and organizations have programs that are attracting students. They're not enough.

    As Mr. Anderson brought out earlier, we have so many of our students who are not choosing the science, technology, math, engineering area, and we need to redirect this workforce—these people toward the workforce needs in that area. So we've got to recruit creative programs that offer scholarships, that offer incentives for students to be a part of this would be a great asset I know from the perspective of an educator.

    And then there is the aspect of accountability. Any program that's started must have clear factors that make people accountable. And of course, that would have to do that as well.

    And finally, I would say that somehow in the message we have, it's got to be communicated that with the H-1B and the other programs, that we're not competing against foreigners or immigrants. At my school, we have a variety of our faculty and staff are from other countries, and our student body, we have more than 40 countries represented on our campus. And so, we celebrate the diversity. We celebrate the globalization there.
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    But yet, at the same time, we have to understand the needs of people in our own home country and how we have to develop workers to be ready to fill these positions. So there's got to be this message of collaboration and cooperation that's sent out as well.

    In conclusion, I believe that this program, these elements I have just described—this Committee supporting it, this Committee backing something like this, putting the word out—that we need to do more in terms of preparing our young people, directing them to these important areas.

    I end by simply sharing a story I heard some time ago. It was about a man who lived in Nigeria, West Africa. His name was Modupe. He lived on a high mountain, and in the valley below Modupe, there was a village of people who he loved very deeply. He once had been a part of them, but he moved by himself after his wife had died, and he lived there.

    Through this valley, they had a river flowing. And this river would flow there, and the people supported themselves by this river. They farmed from it. They washed their clothes in it. They drank from it.

    One day, Modupe, when he was on this mountain, he looked down, and he saw that the dam that was holding, controlling this river was about to burst. It had been a heavy rain. And he realized that I've got to do something to help these people, but he didn't know how. He didn't have time to communicate with them.

    Then an idea came to him, and he rushed quickly, and he went and he set his house on fire. And when Modupe set his house on fire, the people in the village, they looked up there. And they saw him, and they said, ''There our friend is. We must help our friend.''
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    And they set the alarm, and all of the women, boys and girls, and men rushed to the top of the mountain to help their friend Modupe, whose house was burning. When they got there, they realized what had happened. They looked down. They saw the damn had burst, and the whole village was destroyed. And they began to cry, and they felt so bad about it.

    And then they realized that something marvelous had happened. Modupe said to them, ''Don't worry. Because what has happened is by helping someone else, you have, in fact, saved your friend.''

    I believe that if we can direct workers and move people in this area, we will, in fact, strengthen, help, and even help to save our country and its workforce.

    Thank you very much.

    [The prepared statement of Mr. Baker follows:]


    Good Morning, my name is Delbert W. Baker. Thank you to Congresswoman Sheila Jackson Lee for the opportunity to speak to this committee.


    I am the President of Oakwood College, an Historically Black liberal arts College, located approximately ten miles from NASA-Marshall Space Flight Center and the Redstone Arsenal in Huntsville, Alabama. Established in 1896, Oakwood College has the distinction of being one of the top ten institutions in the country that sends minority students to graduate from medical school. Enrolling approximately 1,800 students, Oakwood College is one of the thirty-nine colleges in The College Fund/UNCF and one of the 120 member colleges of NAFEO—the National Association for Equal Opportunity in Higher Education.
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    Oakwood College has a history of success with a student population that matriculates and persists to graduation. The College has been able to accomplish this due to a variety of factors, one of which has been the support that it has received from programs that are designed to increase student participation in fields that have minority under-representation. These programs have been supported by organizations like CSEMS, the Computer Science, Engineering and Mathematics Scholarships programs sponsored through the National Science Foundation (NSF) and Department of Labor (DOL).


    Today I am appearing to give testimony from a unique perspective. My objective is to make comments about the H-1B program, and how support of H-1B should not obviate efforts to adequately prepare U.S. students and particularly under-represented minorities, women, persons who are physically challenged and those who are economically and socially disadvantaged to successfully take their place in the American workforce. More specifically, the intent of my comments is to reason that because of the reality of H-1B program, government and businesses should redouble efforts to assist those under-represented U.S. citizens who are seeking to, or potentially can, rise to fill positions currently targeted by the H-1B program. This objective can best be facilitated by establishing a complementary empowering program.

    Research supports the fact that despite gains made in past years, under-represented Americans, referred to earlier, remain seriously disadvantaged in their pursuit of careers in the areas of science, math, engineering, and technology. These groups still remain conspicuously absent in businesses, and corporate settings where science, engineering, and mathematical skills are required. With vision and the proper support, this reality can be reversed.
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    I am an educator. My role is to prepare students for the workplace, to prepare an educated workforce to meet the demands of a technologically complex and knowledge-based economy. However, I am also acutely aware of the immediate need that the U.S. has for highly trained, specialized workers that the H-1B Visa program was established to meet. The objectives of the program have been widely articulated: the need to supply educated, specialized guest workers, while protecting American jobs; the need to protect the rights of guest workers, while utilizing them on a short-term and limited basis; the need to get necessary jobs done, while not displacing or adversely affecting the wages or working conditions of U.S. workers.


    There is an equal rationale for prevailing principles to govern and safeguard the U.S. approach to the H-1B program. These principles encompass, but are not limited to:

    1) A deliberate communication to the American worker that H-1B legislation does not lessen concern for the American worker. The government should avoid the perception that all government and industry want to do is fill jobs and produce goods and services in order to keep a competitive economic edge. H-1B legislation and enactments must communicate to all Americans that America will diligently invest in the development, maintenance, and enhancement of all sectors of the American workforce.

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    2) Protections for H-1B workers that ensure their dignity and civil rights will be preserved. These protections must certainly include measures to prevent exploitation, hiring H-1B workers at prevailing wage standards, whistle-blower protection for those who expose illegal or immoral practices, and measures to detect and avoid visa fraud.

    3) A unifying operating principle that views H-1B workers and permanent American workers as partners and not competitive enemies.


    With that said, I move to the major reason for my testimony. The perspective that I bring is Janusian—a term that has become popular in educational circles. In Roman mythology, Janus was the god of gates, doors, beginnings, and endings. He was depicted with two faces looking in opposite directions. Thus, Janusian thinking says one can simultaneously keep in mind that which may seem like opposing perspectives. We are Janusian in our thinking when we can, function in the context of and use paradoxical conditions to solve vexing problems and construct important paradigms and innovative solutions.

    The H-1B dilemma requires Janusian thinking. While there is a need for a viable, reasoned H-1B program, our government leaders must equally ensure that everything possible is being done to adequately prepare American citizens to be strategic and productive workers for the future. These balancing concerns must be assiduously pursued by legislators, educators, government and public servants, and the American public in order to ensure a prepared U.S. workforce for the future, so that American labor will not continue to be dependent on essential professionals by necessity or lack of preparation.
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    One of the best ways to ensure that we are prepared for future labor demands and complexities of a global economy is through proper attention to education. I support educational initiatives for all students, but we must assiduously promote and protect programs that prepare minority students in technology, science, math, and engineering.

    Fortunately, there are models and precedence for this approach. As I stated in my introduction, the programs that have been implemented at Oakwood College have helped us prepare minority students. Programs sponsored by the Government can and do work.


    This is borne out by programs, grants, and contracts with federal agencies such as: the Department of Defense (Enhancing Math and Science Education; Expanding Research Opportunities for Undergraduate Students), the National Institutes of Health (RISE-I-CARE = Research Initiative for Scientific Enhancement-Improving Curriculum by Academic and Research); National Science Foundation (ACER = Active Chemical Education through Research); MGE = Minority Graduate Education Program and Title III Funds, and in collaboration with NASA (MISE = Minorities in Science and Engineering; PAIR = Partnership Award for the Integration of Research); UNCF Special Programs (SEEDS = Strategies for Ecology Development and Sustainability). More than 100 students in the STEM (science, technology, engineering, and math) programs have benefited from these entities; and our graduates in the natural sciences are pursuing and obtaining non-medical M.S. and Ph.D. degrees. These programs are complimented by private industries like SAIC (Cost Plus Award Fee Subcontract to NASA).

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    These programs work. Many of the successes and positive outcomes can be directly linked to Congressional programs and presidential actions, like the one taken by President Bush in 2002 when he signed the Presidents' Executive Order 13256 . . . ''regarding the needs of Historically Black Colleges and Universities in the areas of infrastructure, academic programs, and faculty and institutional development . . . , strengthening fiscal stability and financial management, and improving institutional infrastructure, including the use of technology, to ensure the long-term viability and enhancement of these institutions.''


    Here is a specific recommendation for your consideration. This recommendation provides a foundation, a platform for broader, more creative and comprehensive initiatives.

    The recommendation is that the government earmark funds to establish a pilot program to compliment the H-1B program. This foundational program would include but not be limited to the following five components: AWARENESS, TRAINING, RECRUITMENT, ACCOUNTABILITY, COOPERATION (ATRAC):

    1) AWARENESS: That a plan be developed and implemented to educate the general public, our K-12 system, and our institutions of higher learning on the need to aggressively prepare students to assume careers in science, math, engineering and technology. These programs must be laser-focused and insistent. Special efforts must be well-placed to encourage women, under- represented ethnic minorities, persons who are physically challenged and Americans who are socially and economically disadvantaged.
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 We are missing the valuable contributions that these groups can make to our national economy and landscape by allowing their numbers to continue to be miniscule in professional graduate education, research, and in business management.

    I have no doubt that such a public awareness campaign for education can be effective if it is undertaken with persistence. Through public relations efforts in America we have begun to see changes in the way our citizens eat, exercise, and watch their weight. We have initiated the Amber alert system that mobilizes communities when a child is lost or abducted. We have the Homeland Security Advisory System, color-coded to inform society of the potential threat conditions. The public has become aware of a vast, and heretofore unrecognized, need for ethics in business and politics through a public, informal education received at the hand of legal interventions and court trials. Equally, we must develop strategies that educate the public about the benefits and necessity of preparing students in vital areas where current preparation is lacking.

    2) TRAINING: That oversight organizations begin and/or continue to provide or increase funding for programs that train educators and institutions which actively prepare students for targeted professions. Many HBCUs and other minority-serving institutions are struggling to attract, recruit, and retain students with uncultivated skill and talent. Professors, administrators, staff, and institutional researchers must have on-going training in best practices, benchmarking strategies and future trends if they are to be expected to meet current issues and address new challenges.

    Programs like the ones that are currently in place in the National Science Foundation and Department of Labor must be expanded and include ''train the trainer'' components. These programs must be accessible to all institutions, particularly minority-serving institutions. While programs to train faculty in colleges and universities are vital, we must not fail to adopt the forward thinking that includes training for K-12 teachers so that the seeds for career possibilities in technical areas can be planted in students' minds as early as possible.
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    3) RECRUIT: Well constructed, intentional programs should be developed in all appropriate agencies to attract and recruit under-represented students. As referenced above, the Presidents' Executive Order as implemented through the White House's initiative for Historically Black Colleges and Universities is a good model on how this might be implemented. Conventional wisdom most certainly includes scholarship and grant opportunities to promising students. Scholarship programs provide a compelling incentive to students and their value cannot be minimized.

    However, the challenge, in our education partnership, is to devise new ways to motivate students in critical areas. The programs of the last 30 years—Youth Motivation Task Force (YMTF), Black Executive Exchange Program (BEEP), INROADS (that emphasizes Selection, Education and Training, and Performance)—have recently been complimented by the US Dream Academy and MiFuturo to be more representative of the full diversity of the under-represented segments of our society in a highly technological global village. The goals of the above initiatives and what I am advocating in relation to H-1Bcan share in common some of the same content objectives:

1. Practical experiences in self-esteem and character building.

2. Integrating culturally diverse mentors and role models into the education equation.

3. Peer tutoring.

4. Increased technology literacy.
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5. Career coaching and access to post undergraduate providers offering internships, entry level positions, and graduate education.

6. Community Assistance and Service Learning.

7. Leadership.

    Of course, the best educational culture provides learning that can be applied and in real time. Hence, modern techniques, ranging from interactive web portals to mentors to onsite learning centers will make it possible to fill the gap, develop competency, and respond to student needs more selectively.

    I advocate that we evolve learning communities which collaborate in the delivery of relevant, innovative cutting-edge curricula and community partnership. We must deploy intrusive strategy that seeks to customize educational offering to meet the unique needs of a diverse student population, high tech society, and future workforce.

    4) ACCOUNTABILITY: The programs and plans, to be effective, must be specific, measurable, and have accountability imbedded. With intentional oversight and with the appropriate bodies to insure that they are accomplishing their intended objectives, this complementing program could also serve to deflect criticism of the H-1B program. More importantly it would intentionally be investing in the future potential of our citizens, be a deterrent to crime and ''drop-outism,'' and develop workers for the targeted areas.

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    5) COOPERATION AND COLLABORATION: The final point of this proposed H-1B program is a values-based PR component. The H-1B program will be best served if it operates in a context of cooperation and collaboration. The current H-1B program need not be surrounded with suspicion and whispers of conspiracy. Establishing a ATRAC pilot program would help to allay suspicion by assisting U.S. citizens who will be impacted by the H-1B program. It would allow the H-1B platform to move from a reactive position to a proactive one.


    All aspects of the ATRAC program would send the message that historically disadvantaged and under-represented groups are in cooperation and collaboration rather than in competition with the benefactors of the H-1B program. Everyone benefits. It provides a firm foundation for citizens and immigrants to work together for a stronger America and a stronger global community.

    In conclusion, this ATRAC approach could facilitate a win-win situation. I appeal to this Committee to seriously consider endorsing this type of programmatic approach that will ensure the future of under-represented American workers while simultaneously utilizing the H-1B Program to meet current needs.

    Thank you for the opportunity to testify and for your consideration of this approach. I trust these ideals will be useable.

    Mr. KING. Thank you, Dr. Baker.

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    And I will recognize myself for 5 minutes and start with you on that—on that subject.

    I just look back in about 1959, when Sputnik went up and America went into a panic. And most of us students that were sitting in a classroom at that time—and I was in about sixth grade—whether we knew it or not, we were going down the path of science and math and physics and chemistry.

    And today, it'd be computer technology and some of the other IT if this happened. We went into a national mobilization because we realized that we were maybe behind in the science and technology.

    And you talked about educating foreign students as well as American students and trying to find a balance between that.

    Mr. BAKER. That's correct.

    Mr. KING. That's the most difficult question that we have to address here. In fact, it is the central question for this hearing and for this Committee and for the Congress as a whole.

    But I—I'd pose this question to you, and that is, you're educating foreign students as well.

    Mr. BAKER. That's correct.
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    Mr. KING. Some of them will stay in this country. Some of them will go back to their home country. What happens to the second generation of those engineers and those scientists and those technology majors when they go back to their home country? Do they become educators and professors there?

    Mr. BAKER. Well, that's an excellent question, Mr. Chairman.

    We actually encourage the foreign students who come to Oakwood to, in fact, return to their home country. We're concerned about the ''brain drain'' and the fact that they're leaving, in many cases, the Caribbean, Africa, South America. So we encourage them to go back.

    We have very little control over that. America is very appealing. Too many of them, often they don't want to go back. But at least this is something we stress.

    And I put in the record this Janusian concept, the idea that the god Janus looked two directions at one time. This is a real dilemma, and it's something that we all struggle with. That they are appealed—they see so much in the U.S. that they want to come here for, but yet, at the same time, we encourage them to go back and help. And that, ultimately, it becomes a personal decision.

    Mr. KING. But as this number of students, foreign students that we're educating on H-1B visas and as those numbers increase and those percentages go up from half to two-thirds and maybe higher than that, as Mr. Anderson testified as well, and if they go back to their home country and they become educators, don't they establish universities there, and they educate that there?
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    The next generation of those students won't have a need to come to the United States to pick up that education. It will be there in their home country. Now that's a good thing for that country because it projects American values and technology and lifts their economy.

    But what do we do if we're left here, and we're not educating our American workers? I guess I'd submit this, that using your analogy and your story, we may be building our village in a flood plain here by educating foreign workers, sending them back to their home country, and not educating American citizens that are here in their place instead.

    And that's my concern. Would you comment on that?

    Mr. BAKER. Well, I think that's a very good point. I think that there's no question about it. We've got to educate our own people as well. I don't think we should be exclusive.

    And like, when someone knew I was coming here, they knew that I was coming to this hearing, and one of our faculty approached me and said, you know, ''Dr. Baker, we're really concerned that''—they asked me to make a simple message. I didn't put this in the record. But they said, ''Would you help them to make it so that it's not so bureaucratic?''

    It's so difficult. They say we, in fact, can help to train workers, train your people, Americans, as well as people who go back to their country. So there is a need for us to stay here as well.

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    I do believe, though, that there is a need, Mr. Chairman, for them to go back and to help their own people, to build and to establish and move on from there.

    Mr. KING. At the time, find a balance.

    Mr. Anderson, how would you answer that question? You've asked for 195,000 H-1B visas. Is that—is that number something that's been empirically arrived at by a study across America here, or is it a political number? And would you be willing to support a higher number or a lower number in subsequent years?

    Mr. ANDERSON. I mean, that's a good question. I mean, basically, as Congressman Smith knows—he's been very involved in this issue—I mean, a lot of these numbers that have been picked have been basically political compromise numbers.

    The reason I mention 195,000 is that's something that was shown to be acceptable not very long ago, and it basically worked for its purpose because it was able to pass the Congress, but also there were plenty—there were enough visas there that you didn't see these long hiring delays. And so, you didn't have the situation where, literally—as I point out in the testimony—people cannot be hired unless they're on—hired on an H-1B visa.

    And so, you have the situation where if someone is graduating from a college campus, except in some circumstances, they basically are not going to be hired—be able to be hired—in the United States.

    Mr. KING. But Mr. Anderson, how would you answer the question of if the United States has moved our numbers of our—in our science and technology educational fields up to where, as your testimony, 50 percent to two-thirds of these students are foreign students, and if a significant percentage of those leave—we were able to educate American students here to meet the technology demands in 1959. And we went to the Moon 10 years later.
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    Now, what's the reason why we can't educate American students to fill these roles now? And this supply and demand question that's out there that Mr. Miano testified to and also Mr. Huber testified to, a $30,000 reduction in those wages, wouldn't you hire an engineer for a third less if you can?

    And those kind of questions, how does supply and demand work into this equation if we're going to continue to bring in cheap labor? And I'll let you answer the question, and then we're out of time.

    Mr. ANDERSON. Sure. Well, I think that the basic issue is we really don't have a fixed number of jobs. I mean, I think that one of the reasons why we aren't finding enough Americans in these fields is that you've seen an expanding economy, particularly in these fields.

    I mean, Marc Andreessen, the founder of Netscape, talks about how in 1993, he could tell you that there were about 200 people working on jobs related to the Internet. And about 10 years later, there are about 2 million. So some of this concern about having enough Americans to fill these jobs is, in some cases, a story of that we've had an expanding economy and expanding in these fields.

    Mr. KING. Thank you, Mr. Anderson.

    And I yield back the balance of my time and recognize Mr. Berman for 5 minutes.
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    Mr. BERMAN. It seems like there's sort of three separate strains here. One is, Mr. Anderson, a lot of impressive leaders in different kinds of technology industries. Others are saying we are getting strangled by the cap on H-1B. We are being forced to outsource and look elsewhere and lose in the competition for creative and innovative people because of the cap on H-1B.

    Dr. Baker is saying why don't we fix part of this problem by incentivizing more people to go into the sciences and math and the computer sciences so we can provide these wonderful opportunities for people who are in this country, growing in this country, being educated in this country? There are—there is opportunities out there, and we don't do enough to drive, through policies at the local and Federal level, people into that area.

    And then you have, in a sense, Mr. Miano and Mr. Huber, from personal experience, saying there are people out there. These people you're hearing from, Stuart Anderson, the business leaders clamoring for the increase in the cap, they are really imitating what has gone on in the context of employers of relatively low-skilled workers.

    They're looking for ways to cut their costs and maximize their profits by treating this as a—as a wage-cutting, benefit-limiting method of getting the same kind of help they could otherwise get through the normal marketplace by sort of creating this force channel of imported labor, who will allow them to do what they want to do cheaper and thereby sort of alter the market in that context.

    I'd like to hear Stuart Anderson respond sort of to—to that point of Mr. Miano's and Mr. Huber's testimony.
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    Mr. ANDERSON. Sure. Well, I mean, as was pointed out in the opening statements that, you know, the law requires that an employer has to pay the higher of the prevailing wage or the actual wage paid to other individuals.

    There was a compromise struck in 1998——

    Mr. BERMAN. But Mr. Miano says that ain't happening.

    Mr. ANDERSON. Right. Well, let me—I can talk about it, his study. I mean, I think there's basically two problems with Mr. Miano's study, and I'm sure he did the study in good faith.

    But first of all, he looked at prevailing wage data, which was publicly available at the Department of Labor, but that's not necessarily what companies pay. Companies pay the higher of that or the actual wage paid to other people with the same qualifications and education at their workplace. And that information is filed with the immigration service.

    And we looked at—we asked a law firm to do—just to test this proposition and to do a sample of 100 cases and found that it was about 22 percent higher.

    Mr. BERMAN. So you mean the Department of Labor statistics don't actually reflect——

    Mr. ANDERSON. No, they don't reflect what someone pays. That's the bare minimum. You have to pay the higher of the prevailing wage or the actual wage.
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    And then what Mr. Miano does is compare computer programmers——

    Mr. BERMAN. Wait, wait, wait, wait. The prevailing wage or actual wage?

    Mr. ANDERSON. Or the actual wage that you paid other people like at your firm who have a similar education. For example, if you have a lawyer with 10 years experience that you're hiring, you have to—you have to also, you know, pay them the same as you're paying a lawyer that has 10 years at your firm.

    And so, that's the second problem on the study is he compares the computer programmers that are newly hired to the average wage of all computer programmers in the United States, and the statistic actually includes bonuses, for example. And you know, to compare it to all new hires, it would be no more fair than, say, comparing—I mean, I look at the congressional staff. A lot of friendly faces. Been here a long time.

    If you were to compare newly hired congressional staff to the average wage of all congressional legislative staff in the Congress, you would basically come to the conclusion that Members of Congress are somehow exploiting all their workers because the salary for newly hired people on legislative staff is much less than the average wage for all congressional staff.

    Now I know none of the workers here feel they are exploited, but—but the point is, you know, it's no more fair to blame Members of Congress that they don't pay as much for every single new hire as they pay—you know, as it would be to blame all technology companies that every new hire doesn't get paid.
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    Again, the main point is, is that you cannot hire anyone today directly on a green card. You know, it takes—it's 5 years.

    Mr. BERMAN. Although let me—can I just interject one thought here? In a weird way, this whole fight about H-1B is a funny kind of fight. Isn't the real answer to fix the underlying regular immigration system, the distribution of visas and all of that, rather than continue to rely on these temporary programs for essentially permanent positions?

    Mr. ANDERSON. I mean, I think you would still—even if you completely fixed the green card thing, you'd still want to have some number of H-1Bs, you know, for people who come in for projects and people who may not be a good fit for staying here.

    But I completely agree and I know that there's others who agree that it would be a good idea if you had enough employment-based green cards and a process where someone could get hired in, say, 30 to 60 days. They get hired on a green card. It would be an incredible competitive advantage for U.S. companies that they could hire people directly on a green card.

    But the reality is that, you know, no one can start—you know, it's a 5-year wait, and no one can, you know, get hired today. And they say, you know, ''Come back on March 30, 2011, and Mary will show you around the office.'' It just doesn't work that way. So, in reality, companies have to face with what they're faced with.

    Mr. KING. The gentleman's time is expired.
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    I recognize the gentleman from Texas, Mr. Smith.

    Mr. SMITH. Thank you, Mr. Chairman.

    It seems to me that it's pretty obvious that all of our witnesses today either oppose the H-1B program as it's currently configured or support a cap, in the case of Mr. Anderson.

    What I'd like to get at is that it seems to me that no one supports unlimited H-1Bs. There is more than a tacit recognition, there's actually an overt recognition that we, at some point, would do a disservice to our—to American students and others whom we would try to encourage to become experts and skilled and technically proficient workers.

    And therefore, it seems to me that the goal, if we have an H-1B program—and obviously, at some level we do as well—whether it's 65,000 or 195,000—we would want to have a program that did not adversely impact the future of American workers.

    And my question goes—and this—my questions goes or is really based upon a conversation I had in my office recently with someone from a high-tech company who is a very, very strong advocate of H-1B workers. And this individual was willing to say that because I feel both that we need H-1B workers currently, but because in the future I hope we will have more homegrown technically skilled workers, that if we had a program, I'd be willing to accept the premise that we ought to have a temporary program in hopes that we would have our homegrown talent and perhaps even have a sliding cap that would decrease over time, again, so that we would not shut out homegrown American workers.
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    If you do have a permanent program with a relatively high level, you're basically never providing the incentive for American students to become those highly skilled workers.

    And so, maybe, Mr. Anderson, I'll start with you. Would you support that kind of a concept? And I realize by stipulating that we have an H-1B program, that might not be something that's supported by some of the other witnesses.

    But if we did have an H-1B program and in order to provide an incentive, increase the demand for homegrown talent, wouldn't it make sense to have an H-1B program that is temporary for a certain number of years, and that perhaps went down after a certain number of years so that we wouldn't eliminate the incentive for American workers?

    Mr. ANDERSON. Sure. I think—you know, and something that you've tried to do is try to achieve the balance, and I think we had the increased regulation that took place in the '98 bill and the increased—the money for scholarships that was pointed out in the testimony about, 40,000 scholarships have been created.

    I mean, the only problem with trying to pick a number and then have it go down over the years is that's somewhat what we've seen in the most recent years, and the problem is that it's turned out because of demand and the economy, it's turned out to not—you know, to not be enough.

    I do think there is adequate incentive for people to go into some of these exciting fields now. I mean, I do think there are a lot of Americans going into these fields. I just think the demand, because of the——
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    Mr. SMITH. But if you had, say, a high permanent level, then you—it seems to me—are building in sort of a built-in subsidy or a built-in disincentive if you have that for the foreseeable future, then you're alleviating the demand to that extent. And I don't know under a free market system whether that is really providing an incentive for American students to take up the sciences or the computer sciences and so forth.

    So I do think that there's a case to be made that if you have an H-1B program, it maybe should come down over a number of years or it would not be permanent so that we continue to provide the economic incentive for students to focus on those particular types of professions and also to let the wages increase so that we do attract students in those particular categories.

    Did you want to respond, Dr. Baker?

    Mr. BAKER. Yes. Yes. I do want to make it very clear that I don't oppose H-1B. And I even would go as far as to say that your sliding approach to the cap has much merit to it.

    I think the concern is the safeguards with it. Is it being abused, and how can it be safeguarded so it's not taken advantage of?

    Mr. SMITH. Yes.

    Mr. BAKER. So those two points are clear.
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    The other point, though, you mention about homegrown. That's absolutely true. That's what we really need to do. This program should support our efforts to develop people to fill these positions.

    And that's why I brought up, the item perhaps was before you came in, and that is the issue of having a complementary program to help develop the people, especially the underrepresented, those who are disadvantaged, who badly need to be prepared for these positions.

    Mr. SMITH. I did read that in your testimony.

    Mr. Chairman, let me just make a final point—our new Chairman, let me make a final point.

    Mr. GOHMERT [presiding]. The Chair yields an additional minute. Without objection.

    Mr. SMITH. Thank you.

    And that is that the attestations that we have in some of our immigration laws, including attestations that apply to H-1B dependent companies, and those two attestations are typically that you have to advertise for an American worker first and that you cannot fire an American worker and replace the American worker with a foreign worker. My concern about those is it's—they are both unenforced and perhaps unenforceable and do not work.

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    So we will have to come up with better types of safeguards for American workers as we proceed to discuss either this type of immigration, the H-1B, or other forms of immigration visas as well.

    Thank you, Mr. Chairman.

    Mr. GOHMERT. Thank you, Mr. Smith.

    The Chair will yield to the gentleman from California.

    Mr. BERMAN. Mr. Chairman, can I just in a regular order ask unanimous consent to put into the record a letter to Chairman Hostettler and Ranking Member Sheila Jackson Lee from Microsoft, Jack Krumholtz, regarding this issue?

    As you might imagine, he thinks the 65,000 H-1B cap is—is arbitrarily low and hurtful to both his company and to the overall technology economy.

    Mr. GOHMERT. Without objection, the letter will be entered as part of the record.

    [The letter from Mr. Krumholtz follows in the Appendix]

    Mr. GOHMERT. The Chair recognizes the gentleman from Virginia, Mr. Goodlatte.

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    Mr. GOODLATTE. Well, thank you, Mr. Chairman. And I'd like to thank you and Chairman Hostettler for holding this hearing on this important subject.

    It's important to note that this hearing is about legal immigration, not illegal immigration. And I have concerns about many of our Nation's legal immigration laws.

    In fact, I have introduced legislation to eliminate the visa lottery program through which 50,000 aliens are chosen at random to come and live permanently in the United States based on pure luck. The visa lottery program threatens national security, results in the unfair administration of our Nation's immigration laws, and encourages a cottage industry for fraudulent opportunists.

    Traditionally, our laws dealing with immigration and foreign workers entering the U.S. have focused on ensuring that those who come into our country have existing connections with family members lawfully residing in the United States or with U.S. employers.

    These types of relationships help ensure that immigrants entering our country have a stake in continuing America's success and have needed skills to contribute to our Nation's economy. Programs such as the visa lottery program ignore these types of connections and, thus, present unnecessary risks to our Nation.

    On the other hand, the H-1B visas bring workers into our country who businesses believe will better our workforce and economy. In addition, these workers have a stake in America's success.

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    I believe that U.S. businesses should have access to the best and brightest workers in the world. U.S. workers have consistently been the best and brightest, and we are working to ensure that U.S. policies continue to encourage top-notch graduate and post graduate degrees in math and science so that the U.S. continues to produce the most talented graduates in the world.

    However, highly skilled talent is not limited to the U.S. Many students from around the globe come to the U.S. to get advanced degrees in math, science, and other specialty occupations. Our Nation's businesses should be able to choose from the very best.

    While we should ensure that the most talented, high-skilled workers are available to U.S. businesses, it's equally important that we ensure that businesses do not abuse the process to artificially reduce wage rates or to displace talented American workers.

    Another issue that Congress must grapple with is the amount of H-1B visas we should allow. When contemplating the cap issue, we must consider the demand for these workers in the U.S., the effect on the U.S. high-skilled workforce, the competition from other countries to bring the most talented workers within their borders, and many other factors.

    If there is a demand for highly skilled workers that cannot be met by the U.S. workforce, I would be supportive of efforts to ensure that U.S. businesses have access to the most talented pool of workers from around the world.

    Earlier this week, the Senate Judiciary Committee voted to increase the H-1B visa cap from 65,000 to 115,000, beginning in 2007. The provision would also raise the cap in any fiscal year when the limit is reached.
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    This hearing today is both timely and appropriate. I would welcome my comments being reviewed and commented upon by any members of the panel, and I'll open it up for anybody who wants to respond.

    Mr. MIANO. I'd like to respond.

    Mr. GOODLATTE. Mr. Miano?

    Mr. MIANO. I'd just like to—if the state of the H-1B program is such that employer, as in my local area, could summon all its IT workers to an offsite meeting, tell them you're fired, and be replaced by H-1B workers. That's the sort of thing that we're seeing in the industry. It happened in a number of companies just in my area with hundreds of people being involved.

    And we don't have even the basic—basic level of protection where an employer can't just openly fire Americans and bring in replacements through a third party. I mean, that's where we—you know, we want to start at that high level first——

    Mr. GOODLATTE. Anyone want to respond to that? Mr. Anderson?

    Mr. ANDERSON. Yes. It's just completely untrue. Basically, the law—the law on if someone has what's called, you know, an H-1B dependent company that it's going to replace Americans, basically, specifically prevents that. There's a whole—there's a whole body of—let me give you an example.
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    This is—this is the reg that the Department of Labor sent up, just from the 1998 law, and these are the books that the various companies have to use just to try to comply with the law. It's a very highly regulated system.

    In addition, for companies that aren't H-1B dependent, there's a provision that if you—you cannot lay off an American and then—and then hire an H-1B worker that is—you know, that is underpaid. You get—I think it's about a $35,000 fine per violation, and you also end up getting debarred from——

    Mr. GOODLATTE. Let me ask Mr. Miano, have you had any experience with workers being displaced, as you describe them, and going through this process?

    Mr. MIANO. Absolutely. And under oath, I say I've seen it firsthand, personally.

    Mr. GOODLATTE. Would you submit to the Committee the information so that we can have the benefit of that as we——

    Mr. MIANO. It's in my written statement, sir.

    Mr. GOODLATTE. Okay. Specific?

    Mr. MIANO. Specific.

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    Mr. GOODLATTE. All right. Let me ask you this question to all of the members of the panel. Is there evidence of a high rate of unemployment amongst highly skilled American workers as a result of what Mr. Miano describes? Dr. Baker?

    Mr. BAKER. I would say in the underrepresented areas and with minorities, I wouldn't say that they're unemployed, but they're not trained. And there's very little effort in so many circles to get them to a point where they can be qualified to fill these positions you're referring to.

    Mr. ANDERSON. I mean, the overall unemployment rate is pretty low, as you know, in the country, 4.8 percent. I believe the unemployment rate for professionals generally is about a little over 2 percent. It may vary from different occupations.

    But keep in mind, we haven't had—no one has been allowed to be hired on a new H-1B visa for most of the last 3 years, except for—the last 3 fiscal years, except for these open windows, when the Government has been accepting applications and some of the exemptions.

    So for large—I mean, you know, for large months at a time, no one has been able to be hired on a new H-1B, you know, a new person coming and working on——

    Mr. GOODLATTE. Mr. Anderson, let me ask you conversely, if I might—I need to ask one more question.

    Mr. GOHMERT. The Chair will yield an additional minute.
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    Mr. GOODLATTE. I thank you, Mr. Chairman.

    Is there evidence of significant out-migration of high-tech businesses in the country because of the inability to hire the type of workers that they need to sustain those businesses in the United States?

    Mr. ANDERSON. Well, I think you are seeing more—more resources placed outside the country, and I think you've seen a number of companies have—they've basically said that they, you know, would like to be able to hire more in the U.S.

    And if you don't give people a choice on some of the key people they identify that they want—I mean, I know a company that's doing network—network security, and they couldn't get the person in under the timeframe when the cap got hit. And so they hired the person in the UK, and he was heading a team. And so the other people who were going to work with him that would have worked with him in the U.S., instead are working with him in the UK.

    Mr. GOODLATTE. Thank you very much.

    I apologize, Mr. Chairman.

    Mr. GOHMERT. The Chair recognizes the gentlelady from California for 5 minutes. Ms. Waters?

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    Ms. WATERS. Thank you very much, Mr. Chairman.

    I guess I really don't need 5 minutes. I just wanted to get in here and hear what's being said about the need to increase or to have additional H-1B visas.

    I am not supportive of in any way expanding or increasing these visas. I am only about getting the unemployed in America hired. I am about filling jobs with people who are overlooked.

    I am about asking industries that are importing workers and going abroad to do it to just look to the neighboring State oftentimes or across the country. They can find workers. I have a lot of statistics about African-American workers that are twice as likely to be unemployed in the computer and technology industries that have been given to me.

    And so, I don't have a lot to add. I'm—I'm not going to support any increase for anybody anytime, any place, anywhere, anytime soon.

    Thank you very much.

    Mr. GOHMERT. All right. The gentlelady yields back.

    Ms. WATERS. I yield back the balance of my time.

    Mr. GOHMERT. Thank you, Ms. Waters.

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    Gentlemen, we certainly appreciate your testimony. I'd just like to echo the initial comments of Mr. Goodlatte. I think the Diversity Visa Lottery Program is something that has got to go. It's an abdication of Federal responsibility that we let people get a visa by drawing at a lottery.

    So I've appreciated Mr. Goodlatte's efforts in that regard, and hopefully, they will come to fruition so that we can get rid of that program, and your testimony here today will assist in taking a hard look at what we do with H-1B.

    At this time, anybody to my right have any additional questions?

    [No response.]

    Mr. GOHMERT. Hearing none, at this time, the Chair wishes once again to thank all the participants today, and I remind the Members of the Committee that all Members have 5 legislative days to make additions to the record.

    Hearing nothing further, at this time, we are adjourned.

    [Whereupon, at 10:09 a.m., the Subcommittee was adjourned.]


Material Submitted for the Hearing Record

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    I will start by saying that I support the H-1B program. Without it, American employers would not be able to hire enough highly educated professionals for the ''specialty occupations.'' A ''specialty occupation'' is employment requiring the theoretical and practical application of a body of highly specialized knowledge. This includes doctors, engineers, professors and researchers in a wide variety of fields, accountants, medical personnel, and computer scientists.

    Besides using the H-1B program to obtain foreign professionals who have skills and knowledge that are in short supply in this country, U.S. businesses use the program to alleviate temporary shortages of U.S. professionals in specific occupations and to acquire special expertise in overseas economic trends and issues. This helps U.S. businesses to compete in global markets.

    An American employer who wants to bring an H-1B employee to the United States must, among other requirements, attest that he will pay the H-1B employee the greater of the actual compensation paid to other employees in the same job, or the prevailing compensation for that occupation; that he will provide working conditions for the nonimmigrant that will not cause the working conditions of the other employees to adversely be affected; and that there is no applicable strike or lockout.

    The employer also must provide a copy of the attestation to the representative of the employee bargaining unit or, if there is no bargaining representative, must post the attestation in conspicuous locations at the work site. Additional attestation requirements for recruitment and layoff protections are imposed on firms that are ''H-1B dependent.'' A company is considered ''H-1B dependent'' if 15% or more of its employees are H-1B workers.
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    The subject of this hearing is the cap for H-1B visas. The Immigration Act of 1990 set a numerical limit of 65,000 on the number of H-1B visas that can be issued annually. In FY2004, the 65,000 limit was reached in mid-February. On October 1, 2004, the United States Citizenship and Immigration Services (USCIS) Bureau announced that it had already reached the FY2005 cap. The FY2006 cap was reached in August 2005, which was even earlier.

    I know that the American companies can be more aggressive in recruiting American employees, particularly at the minority college campuses. I also think that more can be done to retrain American workers who are being phased out of the high-tech industry when new technology is developed. But these measures in themselves are not likely to eliminate the need for raising the H-1B cap.

    The cap is preventing U.S. businesses from meeting their speciality occupation needs, and their needs are likely to increase. The Department of Labor has estimated that between 2002 and 2012 there will be two million job openings in the U.S. in the fields of computer science, mathematics, engineering, and the physical sciences.

    I view an increase in the cap as a short-term solution to a long- term problem, which is to find a way to produce enough American workers for these occupations. A good first step towards a long- term solution would be to develop a coordinated strategy to expand the education pipeline for American students who are preparing for careers in speciality occupations.

    Foreign students represent half of the U.S. graduate school enrollments in engineering, math, and computer science. It is not surprising, therefore, that U.S. employers frequently turn to H-1B professionals when they recruit post-graduates from U.S. universities.
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    I would like to double the number of American students who earn baccalaureate and advanced degrees in the fields of science, technology, engineering, and math through increased investment in America's math and science education programs.

    While we are working on a long-term solution, the availability of a sufficient number of H-1B visas is necessary to keep American companies competitive in the world market. If we fail to meet that need, American companies may lose out to foreign competition, which could have devastating consequences for the U.S. economy.








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    Chairman Hostettler, Representative Sheila Jackson Lee and members of the Committee:

    Thank you for the opportunity to present the views of our organization on the matter of the H-1B visa program. The Department for Professional Employees, AFL-CIO is a consortium of 22 national unions representing nearly 4 million professional and technical employees in both the public and private sectors.
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    Today under U.S. immigration law there is a near alphabet's soup of professional visas under which foreign professional and technical workers can come to our shores. The H-1B, L-1, TN, I, O, P and other such visas all have one thing in common—each operate under different standards, limitations and rules of accountability and no interconnectivity exists between any of them.

    Given the adverse impact that most of these programs are having on U.S professionals—many of whom are either unemployed or underemployed—as well as on the non-immigrant workers themselves, now is the time for Congress to develop a more comprehensive, coordinated federal policy in this regard.

    What is particularly baffling about these programs, especially H-1B, is that none of them correlate to the realities of the U.S. labor market. There exists no nexus between the current rates of occupational unemployment among professional and technical workers—which as of the end of 2005 is 40% higher than in 2000—and the fact that, according to some estimates, the total professional guest worker population is probably close to 750,000 when former H-1Bs who are illegally out of status are included. Programs like H-1B in effect force well qualified, American professionals to compete against foreign workers here in the U.S. for domestic jobs. In our opinion, there's something seriously wrong with that picture.

    As members of the Committee will recollect, H-1B was initially designed to address small, ''spot'' labor shortages of minimum duration. Our affiliated organizations have no problem with that basic concept. But we vehemently object to how this program has over time contorted into something completely contrary to its original intent and that now victimizes large numbers of highly skilled, American professionals.
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    As Congress contemplates major changes in immigration law enforcement and perhaps new guest worker initiatives, now is the time to be asking tough questions and to consider real reforms in H-1B. Chief among them are:

 What is the total number of guest workers that should be allowed into the U.S. under all such programs in periods of high and low unemployment?

 To what extent should there be some uniformity across all programs with regard to worker protections, employer eligibility, visa duration and fees, guest worker qualifications and credentials, enforcement and penalty protocols, etc?

 Should U.S.-based employers each be limited in the total number of temporary foreign workers that they can have on the payroll from all guest worker programs?

 Are these programs contributing to the off-shoring of American jobs?

 What impact, if any, are they having on the national need to attract the best and the brightest American students into critical undergraduate and graduate disciplines?

 Can multiple U.S. government agencies be reasonably expected to manage, control and enforce the few standards that apply to H-1B when the entirety of the nation's immigration policy is a train wreck?

    A failure to dig deeply, to ascertain and fix existing problems within current programs will risk repeating the policy failures that now plague immigration law and perpetuate abuses that hurt American workers. We sincerely hope that this Committee will address these overarching issues before any consideration is given to raising the annual limits—''caps''—on H-1B visas.
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    What follows is a brief summary of what we consider to be some of the more blatant abuses that have evolved under H-1B along with some suggestions for reform.


    Background: At the hearing on 3/31/06, IT professional David Huber spoke eloquently about how an American company replaced him with H-1B workers and how difficult it has been for him to find other IT work. Sona Shah, a young well educated, highly skilled, Indian-American tech worker, told a similar story at 2004 hearings before the House International Relations Committee about her former company—a body shop where misuse of all kinds of visas was a daily exploit. Other statements will be submitted to the subcommittee by professionals recounting similar experiences. Often the indignity of losing they're job is compounded by the demand of the employer that the U.S. worker(s) train their replacements, sometimes as a pre-condition to receiving their severance pay or getting a good reference.

    This victimization of American workers is being played out everyday as domestic corporations shed their American workers here in the U.S. to hire lower cost visa workers. It should be a fundamental principle of immigration law that no professional worker in this country should ever have to live in fear of losing their livelihoods because federal law allowed a foreign guest worker to come here and take it away from them. Ironclad protections to guarantee that outcome are long overdue.


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 The 90 day, no layoff protections that now exist in law but only for so-called ''H-1B impacted'' companies (defined as having 15% or more of their workforce as H-1B visa holders) should instead be applied to all companies.

 The 90 day standard should be extended to 180 days and applied before and after the hiring of an H-1B visa worker.

 Improved safeguards should be coupled with stiff penalties including civil fines and debarment for violations;

 Finally, any worker—U.S. or foreign—aggrieved by violations of any H-1B protections should be given a private right of action to sue an employer for such law breaking activity.


    Background: Under current law, the annual statutory cap on H-1B visas is 65,000. However, a previously approved exemption for educational institutions, non-profits and other entities allows another 27,500 foreign workers on average to come in to the U.S. At the end of 2004 a Senate Committee initiated exemption—adopted as part of the Omnibus Appropriations bill—created still another cap loophole by adding on another 20,000 annual allotment for U.S. educated foreign workers with advanced degrees. In addition, since the ''temporary'' H-1B visa is good for up to 6 years, according to government data some 125,000 existing visa holders renew annually. As a result, under current law over 230,000 foreign professionals get new or renewed guest worker visas—and American jobs—each year!
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    There is absolutely no economic justification for expanding the H-1B program at this time. Unemployment among professionals in H-1B occupations remains high. For example, in Information Technology—the largest single business user of these visas—according to BLS data, joblessness for computer scientists/systems analysts, programmers, and software engineers is at 45%, 133%, and 115% higher respectively than in 2000—the year before the tech bust. Thus claims of labor shortages in key computer occupations are bogus particularly when weighed against wage data. If the laws of supply and demand are to be believed, then alleged shortages would produce significant wage hikes as employers bid up the price for scarce labor. In fact, real wages for computer scientists/systems analysts declined by nearly 7.5% from 2000–04 while income for IT workers in the other two categories barely grew above the rate of inflation. None of these wage improvements are indicative of a labor shortage.

    Finally it is worth pointing out that industry apologists for off-shore outsourcing have long proclaimed that one of the benefits of globalization would be the creation of high end, high skilled technical and professional jobs for workers in the U.S. These same industries now seek to contract the number of these very same high end job opportunities that should otherwise be available to highly skilled American workers by vastly expanding the H-1B visa program.


 Set a ''Hard Cap'' on the H-1B program with no annual adjustment and eliminate all exemptions. Exemptions make a mockery of any annual numerical cap and should be eliminated.
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    Background: Twice in the last five years—once in FY 2000 and again in FY 2005—the INS/DHS over issued by a substantial amount the number of visas permitted under law. In 2000 the excess was some 23,000—an astounding 20% over the then annual cap of 115,000. And what was Congress' response to a federal agency unable to enforce an elemental standard in immigration law—they forgave the violation by sanctioning it in new statutory language and then proceeded to increase the cap from 115,000 to 195,000 with a new exemption. The inability of government to first enforce a fundamental legal requirement in the H-1B program coupled with Congress' eagerness to simply look the other way and ignore the transgression sent an unmistakable message to the private sector about compliance, oversight and enforcement. Then just last year, according to a Department of Homeland Security, OIG report requested by Chairman Hostettler and Senator Grassley and entitled USCIS of H-1B Petitions Exceeded 65,000 Cap in fy 2005, the over-issuance was 7,000 visas or nearly 11% more than permitted by the 65,000 cap. In its review the OIG cited these contributing factors:

 CIS officials at all levels in Washington, DC and at the service centers were aware of and attempted to comply with the statutory limit on the number of persons granted H-1B status.

 However, CIS had neither the technology nor an operational methodology to ensure compliance with the precise statutory ceiling.

 Faced with the certainty of issuing either too few or too many approvals, it had been CIS' explicit practice to avoid approving too few.
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 The CIS' ''business process,'' of taking all petitions submitted before an announced cut-off date, guarantees that an inexact number of petitions will be approved.

 The structure of DHS handicaps counting efforts; a complex adjudication process makes the count fluctuate;

 A complex counting process makes the cap a moving target; and, an unexpected influx of petitions in mid-September 2004 swamped the cap counting process.

    In other words DHS can't count! And until the agency can guarantee to the Congress that it can and thereby enforce the law, there should be no increases in the H-1B yearly visa cap.


    Background: A problem common to all of the professional guest worker programs including H-1B is the renew-ability of the visa. This issue was a major point of controversy regarding the misnamed ''temporary entry'' provisions of the trade agreements whose one year visa can be renewed forever. Initially H-1B visas were good for only 3 years. Now these guest workers can stay in the U.S. for at least six years (two, three year renewable visa terms) or longer if their paperwork to transition them to green card status is in the DOL pipeline. A program of six years duration does not anyone's definition of ''temporary'' and the program should be more limited.

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 Restrict H-1B visas to one, three year (non-renewable) term.


    Background: At the hearing on 3/31, Rep. Lamar Smith, the former chairman of the subcommittee and an author of many past pro-worker reform suggestions, expressed hi view that employer attestations are ''unenforced and unenforceable.'' We concur.

    A law which relies on something akin to ''scout's honor'' for enforcement of the requirements that employers must make a ''good faith'' effort to recruit U.S. workers and not layoff Americans before applying for an H-1B visa is absurd. A decade ago, in a Department of Labor OIG Audit of ETA's Foreign Labor Programs Final Report'' No. 06–96–002–03, US Department of Labor, 5/26/96(No. 06–96–002–0), found that, more often than not, employers:

''specifically tailor advertised job requirements to aliens' qualifications. The jobs' education and experience requirements were based on the aliens' qualifications, not on the skills required to perform the work'' and that ''The special requirements identified on the application appear to be customized to fit the alien's qualifications rather than represent actual job requirements. This appears to be restrictive criteria to eliminate qualified U.S. workers.''


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 Eliminate and replace attestation process.

6. Prevailing Wage Determination

    Background: Although the H-1B program does have a prevailing wage requirement, it is ineffective because employers can fabricate a wage by supplying their own wage data instead of relying upon government wage information. The so-called ''prevailing wage determination process'', which is not subject to DOL rate setting and may or may not be based on a bona fide locally calculated wage rates, again provides employers with the ability to in effect set their own rates and pay far lower than the actual prevailing wage for a given professional occupation.

    Several government reviews again have identified this area as one wide open for fraud and abuse. The DoL's OIG audit referred to earlier found that:

''There is no certainty that U.S. workers' wages are protected by the LCA [Labor Condition Application] program's requirement that employers pay aliens the higher of the prevailing wage or actual wage paid to their employees who are similarly employed.''

''For 75% of all cases where the non-immigrant worked for the petitioning employer, the employer did not adequately document that the wage level specified on the LCA was the correct wage. In their review of LCAs, the DOL regional Certifying Officers do not verify or question if a public file [on the method of determining the wage and the impact of the wage rate on similar workers] actually exists. 8 U.S.C. 1182(n)(1) does not give them the authority to do so. ''The Labor Condition Application Program is being manipulated beyond its intent of providing employers the best and brightest in the international labor market while protecting the wage levels of U.S. workers.''
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''Even where the employer adequately documented the wage paid, 19% of the aliens were paid less than the wage specified on the LCA.''

    Four years later, The U.S. General Accounting Office in its May 2000 report H1B Foreign Workers, Better Controls Needed to Help Employers and Protect Workers found wage chiseling in over 4 out of 5 cases it investigated:

''WHD (DoL's Wage and Hour Division) is significantly more likely to find violations in H-1bB (back wage) complaints than in complaint cases under other (wage and hour) laws. . .over the last four and a half years, 83% of the closed H-1B investigations found violations—compared to about 40 to 60 percent under other labor laws''

    Requiring the payment of a real and enforceable prevailing wage to H-1B workers would discourage those who would try to use the program as a back door to cheap labor.


 Employers petitioning for H-1B workers must pay the higher of:

 the locally determined prevailing wage level for the occupational classification in the area of employment;

 the median average wage for all workers in the occupational classification in the area of employment; or
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 the median wage for skill level two in the occupational classification found in the most recent Occupational Employment Statistics survey;

 In order to better keep track of H-1B workers and insure that they are paid the appropriate pay, employers should be required to file a copy of the workers' yearly W-2 form with the DOL/INS.

 Penalties—Subject employers who violate prevailing wage requirements to both double back pay awards common in other labor laws to aggrieved foreign workerscoupled with employer debarment from the program. These kinds of punitive remedies will make employers think twice about using H-1B for purposes of worker exploitation.

7. Fraud

    Background: Falsified immigration documents, bogus credentials, sham employer attestations, phony applications, forged petitions on behalf of unknowing employers, wage chiseling and other scams are just some of the litany of illegalities uncovered by investigators at four federal agencies. According to the Semiannual Report of the Office of Inspector General (OIG) to the Congress'' April-September 30, 2000:

''The OIG [DOL Office of Inspector General] continues to identify fraud in the labor certification program, particularly in the H-1B temporary work visa program. These cases involve fraudulent petitions that are filed with DOL on behalf of fictitious companies and corporations; individuals who file petitions using the names of legitimate companies and corporations without their knowledge or permission; and increasing numbers of immigration attorneys and labor brokers who collect fees and file fraudulent applications on behalf of aliens. Based on prior investigative and audit work that found programmatic weaknesses and vulnerabilities in the program, the OIG remains concerned about the potential for increased fraud in this area.''
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''The OIG has averaged 14 indictments and 11 convictions per year for labor certification fraud over the prior [1996] five-year period.''

    And in the DoL's 1996 OIG audit:

''Some aliens are themselves the petitioning employer, thereby filing petitions on their own behalf.''

    Many of these abuses have been traced to outsourcing companies, a.k.a. ''body shops'' who bring in foreign workers by the tens of thousands and then subcontract them out to other businesses. We doubt that the Congress envisioned the likes of Tata Consultancy Services, Wipro Technologies, and Infosys Technologies—all Indian owned firms—when it created this program. These firms are now among the biggest users of H-1B supplying Indian IT talent to a who's who of the fortune 500 corporations. Some of these firms and others like them have had a troubled history under the H-1B program. In fact, prior legislation relating to H-1B has specifically addressed abusive practices by them such as benching.


 Ban ''body shop'' access to the program—Congress should apply the same restrictive language it adopted in 2004 to the L-1 visa program and prohibit access to this program by anyone other than the primary employer.

 Require employers to file electronically with the DOL key information about each H-1B hire—name, country of origin, academic degree, job title, start date, salary level. The DOL shall then make such data available on the Internet.
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    Background: H-1Bs are supposed to be highly skilled professionals with the requisite academic degree. But even this standard is undercut by language that allows a vague degree equivalency, such as work experience, to suffice. In addition there is no system in place to verify that those with degrees have valid credentials or that they are equivalent to a U.S. degree.

    As far back as 1999, the accusations that H-1B applicants falsify job experience and education were exposed. In testimony on May 5th of that year before the Subcommittee during hearings on Nonimmigrant Visa Abuse:

 Jacquelyn Williams-Bridgers, State Dept. Inspector General, stated that attempts to falsify, alter, or counterfeit U.S. visas or passports and attempting to obtain false documents to obtain visas is a ''constant problem both within the U.S. and overseas.''

 Jill Esposito, State Dept. Post Liaison Division, Visa Office, Bureau of Consular Affairs, backed up Yates' statement that documents are routinely falsified. She said that, although many foreign workers in the U.S. on nonimmigrant visas are here legally and properly, there are ''thousands of marginally qualified applicants (who) are also entering the United States in the H-1B and L-1 categories.''

    Ms. Esposito also detailed a year-long joint INS and Department of State initiative which focused on the American Consulate in Chennai, India, which issued more than 20,000 H-1B visas in Fiscal Year 1998—more than any overseas post. The investigation found that 45 percent of the 3,247 work experience claims made to the INS were fraudulent.
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 Current law allows H-1B applicants to have a college degree or the ''equivalent''. This sets a highly subjective standard that is most difficult to apply and often abused. Work experience should not be a substitute for the required academic credentials. This vaguely-worded equivalency standard should be eliminated.

 At present there is no procedure in place for checking on the validity of a college degree cited to support an H-1B petition. The Secretary of State through its consular offices that issue the visas (or another appropriate federal agency) should determine whether such a degree has been granted by a bona fide institution of higher education (authenticity) and is equivalent to college degrees obtained in the U.S.

 To assure that H-1B visas are mainly allocated for use by the most highly skilled and educated, a ''carve out'' beginning at 40% and increasing to at least 50% of the total number of visas should be reserved for ''guest workers'' possessing a master degree or higher.



    According to the DoL's own Inspector General as well as the GAO, federal enforcement mechanisms are woefully inadequate to compel employer compliance with even the weak safeguards that exist under the H-1B program that are supposedly designed to protect American workers. Penalties for violations and outright fraud are too meager to induce compliance.
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    In this regard, the 2000 GAO study referenced earlier in this statement included the following findings:

''Labor's [U.S. Department of Labor] limited legal authority to enforce the program's requirements and weakness in INS' program administration leave the program vulnerable to abuse. Under the law, in certifying employers' initial requests for H-1B workers, Labor is limited to ensuring that the employer's application form has no obvious errors or omissions. It does not have the authority to verify whether information provided by employers on labor conditions, such as wages is correct.''

''There is not sufficient assurance that INS reviews are adequate for detecting program noncompliance or abuse.''

''However, as the program currently operates, the goals of preventing abuse of the program are not being achieved. Limited by law, Labor's review of the LCA [labor certification application] is perfunctory and adds little assurance that the labor conditions employers' attest to actually exist. Expanding Labor's authority to question information on the LCA would provide additional assurance that labor conditions are being met''


 To protect American and visa employees who discover abuses, whistle-blower safeguards should be implemented so that either can report employer misconduct to the appropriate federal agency without fear of reprisal.

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 Department of Labor (DoL) enforcement authority should be beefed up to monitor L-1 usage through random surveys and compliance audits, investigate and adjudicate complaints and impose penalties where warranted. Automatic audits for employers with over certain number of guest workers should be mandated and DOL investigations of suspected misconduct should be allowed without the necessity of having to have a complaint as justification.

 Strict timelines be imposed for the response, processing and administrative adjudication of complaints by DoL; Administrative and /enforcement functions should be centralized in one federal agency—DoL.

 Disallow employers from forum shopping, e.g. appealing an adverse DOL decision on the LCA to the INS.

 To allow for careful review of H-1B applications, the practice of submitting blanket petitions for multiple workers should be eliminated;

 Civil penalties should also be applied for misrepresentation or fraud related to the information submitted on the visa application;

 Congress should mandate appropriate data collection protocols and timelines for reports by the relevant federal agencies to assist Congress with its oversight of this program.


    Finally, there is one last issue that the Committee should be cognizant of, and that is the likelihood that visa programs like H-1B are directly contributing to the outsourcing of U.S. professional and technical jobs overseas. This matter has been the focus of several hearings in the House Small Business Committee and we commend Chairman Manzullo for his past efforts in this regard.
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    Every day in newspapers around the nation we read more articles about how U.S. firms are now exporting white collar jobs. The reason I raise it in the context of this review is that there is a connecting thread. And that is Tata Consultancy Services, Wipro Technologies, and Infosys Technologies—the Indian- owned firms I mentioned earlier.

    These firms are not just brokerage houses for H-1B, L-1 and other visas. They are among the primary culprits involved in the heist of hundreds of thousands of U.S. jobs and tens of millions in payroll. It goes something like this: First they contract with an U.S. based firm to perform a tech related service like software development or maintenance. Then they bring in the Indian guest workers by the thousands to do the work here at bargain basement rates. As committee members may already know, India is by far the largest user H-1B and L-1 visas. Once the team of temporary workers has the knowledge, and technical skills—sometimes after being trained by U.S. workers—as much of the work that is technically feasible to off-shore is then carted back to India. There, the same Indian firms that stoke the visa pipeline are facilitating the creation high tech centers that employ hundreds of Indian nationals to do the work formally done by American professionals.

    An earlier study by Forrester Research estimates that if current trends continue over the next 15 years the U.S. will lose 3.3 million high end service jobs and $136 billion in wages. Other recent studies predict the same or higher levels of jobs and salary losses. In one key segment of the tech industry, Jon Piot CEO of Impact Innovations Group in Dallas says that ''software development in the U. S. will be extinct. . .with gradual job losses much like the U.S. textile industry experienced during the last quarter of the 20th century.'' Today major U.S. firms from many sectors are falling all over themselves to climb on the outsourcing bandwagon.
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    As they used to say in one of this nation's' greatest technology initiatives, the space program—''Houston we've got a problem''. And I would suggest it's a big one. Only this time it's not those textile, steel, machine tool and other manufacturing jobs; many of them are long gone. Now it's the high tech, high end, high paying jobs that are headed out of town. These are the same jobs that we were smugly assured by free trade advocates the U.S. would retain as our manufacturing base was exported. The question for federal legislators is to what extent are the professional guest worker programs contributing to the outsourcing tidal wave. I would suggest that it is significant.

    In conclusion, professional and technical workers in this nation have made enormous personal sacrifices to gain the education and training necessary to compete for the knowledge jobs in the so-called new American economy. They deserve better than to be victimized by immigration programs like H-1B. Congress can make a long, overdue start in cleaning up the guest worker visa mess by implementing badly-needed reforms. At a time when so many American professionals are out of work, from our perspective public policy inaction to clean up the H-1B visa mess is not an option. Until that is achieved there should be no increase in the H-1B annual visa limits.




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    April 5, 2006

    Honorable John N. Hostettler, Chairman
    Immigration, Border Security and Claims Subcommittee
    United States House of Representatives
    B-370B Rayburn House Office Building
    Washington, DC 20515-6217

    Re: Subcommittee Hearing on H-1B Worker Visas

    Dear Chairman Hostettler:

    We appreciate the Subcommittee's March 30th hearing addressing the critical issue of whether Congress should raise the H-1B cap. While we are disappointed that the Subcommittee did not opt to hear from U.S. employers concerning this important matter, we are pleased to submit these comments for the record.

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    The American Council on International Personnel (ACIP) represents over 200 multinational employers, ranging from leading U.S. high-tech, manufacturing, healthcare and service companies to some of the nation's premier research and academic institutions. ACIP members rely on the H-1B program to maintain a competitive workforce. Over half of the H-1B visas go to professionals holding advanced degrees, primarily from U.S. universities. Thus, American employers recruiting at American universities are competitively disadvantaged by the unavailability of H-1B visas. The visa is used by a wide array of professionals including, physicians, teachers, scientific researchers, engineers, architects, lawyers, accountants, marketing experts, and many others who provide direct services to Americans and create new American jobs and products.

    The existing H-1B quotas do not support American competitiveness and innovation. In 2005, foreign nationals earned more than 40 percent of the master's degrees and 60 percent of the PhDs in engineering awarded by American universities. We are delighted that already this year 2.1 million jobs have been created and that U.S. unemployment stands at 4.9%—full employment. The U.S. Department of Labor estimates that between 2002 and 2012 there will be 2 million more job openings in America alone in the fields of computer science, mathematics, engineering and the physical sciences. Worldwide competition for this talent is fierce yet American employers are hamstrung in their efforts to recruit and retain scientific and engineering talent.

    On August 10, 2005 the H-1B cap was exhausted nearly two months prior to the beginning of fiscal year 2006 (FY06). Additionally, in January 2006, the H-1B FY06 advanced degree cap exemption was also prematurely exhausted. Both cap exhaustions leave a variety of business sectors, medical facilities and educational institutions unable to hire new H-1B workers until October 1, 2006, an unfortunate result in an innovative market. The best talent will continue to be lost to our competitors year in and year out until our quotas reflect market demands. U.S. employers need predictability to remain competitive in today's global economy, one that could be provided through a market-based H-1B cap.
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    We disagree with certain critics of reform who argue that the global flow of talented students and employees only hurt America's homegrown workforce and lower U.S. worker wages. Quite the contrary, these innovative foreign nationals fill jobs that currently would remain unfilled and additionally create new American jobs. We believe that in the worldwide economy companies will move to where the skilled and educated workers are if not given the option to bring that talent here and pay them the higher of the actual or prevailing wage. In fact, if it were about cheap wages as critics argue, why would any American employers use the H-1B program at all? They would not; instead they would send all work overseas. But, of course, quite the opposite is true as American employers continue to exhaust the cap early each fiscal year and struggle to recruit the workers they need to keep jobs at home.

    America's ability to attract and retain the best foreign talent is increasingly at risk. In addition to the H-1B cap, foreign professionals face years long processing delays and unavailability of green cards. Visa retrogression has forced thousands of foreign professionals from countries around the world to wait up to five years to get a green card. Most of these professionals have already been in America for upwards of a decade and this unavailability forces them to put their lives on hold even longer. These backlogs unfortunately result in U.S. employers losing many foreign professionals to competition abroad.

    ACIP encourages the Subcommittee to consider legislation that includes the following solutions to keep America and U.S. employers on the cutting edge of innovation: (1) a market-based cap for H-1B visas; (2) exemptions from the employment-based immigrant visa caps for workers needed for their knowledge or contributions to innovation in fields like science, technology, engineering and mathematics; and (3) a direct path to green card for advanced degree graduates of American universities.
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    We look forward to working with the Subcommittee, the full Committee and the entire U.S. House of Representatives as we proceed on immigration reform this year.


    Lynn Shotwell
    Executive Director
    American Council on International Personnel



    April 6, 2006

    Honorable John N. Hostettler, Chairman
    Immigration, Border Security and Claims Subcommittee
    United States House of Representatives
    B-370B Rayburn House Office Building
    Washington, DC 20515-6217

    Re: March 30, 2006 Subcommittee Hearing on H-1B Visas

    Dear Chairman Hostettler:
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    On behalf of Compete America, a coalition of more than 200 corporations, universities, research institutions and trade associations concerned about legal, employment-based immigration, I would like to thank you for addressing the important issue of H-1B visas in the Subcommittee's March 30th 2006 hearing. Our membership is committed to ensuring that the United States has the highly educated workforce necessary to ensure continued innovation, job creation and leadership in a worldwide economy, and the H-1B visa program is critical to achieving this goal. Because none of our members were able to participate in the Subcommittee's hearing, we would like to add our comments to the official hearing record.

    The title of the hearing ''Should Congress Raise the H-1B Cap?'' asks a very important and timely question given the attention focused on immigration reform in both houses of Congress. We believe, however, that to fully address the issues facing U.S. employers and their insufficient access to highly educated foreign talent, the Subcommittee must also look at the problems with the employment based (EB) visa or ''green card'' system. We urge the Subcommittee to schedule a follow-up hearing to specifically address the issues facing U.S. employers and tens of thousands of valued U.S. employees now caught in the woefully inadequate EB visa system.

    Compete America members believe now is the time to fix both the outdated and counterproductive H-1B and EB visa programs. The current system for legal immigration hurts U.S. competitiveness by making it too hard for highly educated, sought after foreign professionals to come to the United States to live and work.

    H-1B shortages are well documented, and the backlogs in the green card system are only getting worse, forcing thousands of valued foreign-born professionals - including researchers, scientists, teachers and engineers - into legal and professional limbo for years.
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    America benefits from the contributions of highly educated foreign nationals, whether they are here on temporary H-1B visas, or as permanent residents. Both the H-1B and EB visa programs have been responsible for bringing much needed foreign talent to live and work in the United States, and most importantly, to make significant contributions to our economy and our global competitiveness.

H-1B Visas

    H-1B visas give employers access to highly educated foreign professionals who work in the United States temporarily to fill a specialty occupation. Under current law the program is capped at 65,000, down from 195,000 in FY 2003. The FY2006 cap was exhausted on August 10, 2005, nearly two months prior to the beginning of the new fiscal year. This marked the seventh time since 1997 that the H-1B cap has been reached before the end of the fiscal year and the second year in a row that it has been reached on or before the start of the fiscal year. (August 1997, May 1998, June 1999, March 2000, February 2004, October 2005, August 2005).

    With no access to H-1B talent, a variety of business sectors, medical facilities and educational institutions are being adversely impacted. U.S. employers need predictability - something the current system does not provide.

    Nevertheless, the H-1B visa remains an important tool, especially for hiring foreign nationals who receive their advanced degrees from U.S. universities.

    In many critical disciplines, particularly in math, science and engineering, 50% or more of the post-graduate degrees at U.S. universities are awarded to foreign nationals. For example, in electrical engineering, 55% of master's and 68% of PhD graduates of U.S. programs in 2005 were foreign students.
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    In FY 2005, Congress recognized the growing problem and added an additional 20,000 H-1B visas as a set-aside for foreign graduates of U.S. universities receiving their Master's or PhD. In January 2006, only four months into the fiscal year, this cap was also reached.

    The numbers Congress has allotted for H-1B visas are clearly inadequate to meet the demand - and it is clearly a counterproductive system that trains foreign scientists and engineers and then sends them home to compete against American businesses.

    We were gratified that President Bush has acknowledged the problem facing U.S. employers and has called for the H-1B cap to be raised. We hope the Congress will do so this year.

EB Visas

    Employment-based (EB) green cards are provided to foreign nationals who are seeking permanent residence and are sponsored by employers to work in the United States. EB green card holders are well-educated job creators who must pass strict labor market tests in order to be eligible for admission. The annual EB green card cap of 140,000 is allocated equally among all countries and covers five worker preferences.

    The 140,000 number, however, is misleading. Unlike H-1B numbers, spouses and dependents are counted against the EB visa cap - greatly reducing the number available to highly educated workers.
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    A further complication is the individual country quotas mandated by the system. For professionals born in high-demand countries, such as India and China, the wait can span up to five additional years beyond the normal adjudication process of two to three years, even if the overall visa limit is not reached.

    Because of the tremendous backlogs in the processing of EB green card applications, tens of thousands of highly trained and sought-after professionals must wait far too long for processing - with no assurance of outcome. Many simply abandon their efforts and return home or move to more welcoming countries - including Canada, Australia and the EU - that are direct economic competitors of the United States.

    This is just a glimpse into the quagmire we call the green card system.

    Both the H-1B and EB visa programs have been responsible for bringing much needed foreign talent to live and work in the United States, and most importantly, to make significant contributions to the U.S. economy and U.S. global competitiveness. Compete America members believe that any immigration reform legislation must include the following:

 a market-based cap on H-1B visas;

 exemptions from EB caps for an expanded group of workers that are needed for their knowledge or contributions to innovation in fields like science, technology, engineering and mathematics (STEM);

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 an easing of visa requirements for prospective foreign students seeking to pursue advanced degree study in the U.S.; and

 a direct path to green cards for advanced degree graduates of U.S. universities.

    U.S. employers need the ability to employ the highly educated workers they need to stay competitive and keep jobs here in the United States. Unlike ever before, the United States is in a fierce worldwide competition for top talent. As our competitors have stepped up efforts to attract these workers, the current U.S. immigration system is preventing U.S. businesses, universities, medical institutions and research centers from hiring much-needed highly educated foreign-born talent.

    If America is serious about remaining the world's innovation and technology leader, we must fix a broken system preventing the legal employment of highly educated and sought after foreign professionals.

    Thank you for this opportunity to present our views. I have attached a March 27, 2006 editorial from the Wall Street Journal that offers an excellent summary of the issue. I would ask that it also be included in the hearing record. Compete America looks forward to working with you and the Subcommittee to as the debate on immigration reform continues.


    Sandra J. Boyd
    Chair, Compete America
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    April 4, 2006

    The Honorable John N. Hostettler
    House Judiciary Subcommittee on Immigration
    B-370B Rayburn House Office Building
    U.S. House of Representatives
    Washington, DC 20515-6217

    Honorable Hostettler:

    I would like to take this opportunity to thank you personally for holding this hearing concerning the H-1B Visa Program and its impact on the American Technical Experts, like myself, in addition to the long term effects upon the country. I greatly appreciate the courtesy you have extended to us by allowing the opportunity for American Workers to offer comments for the hearing record. Thank you.

    Please note this is just a brief synopsis of my experience with guest workers in this country on an H-1B Visa. I have much more to share, but due to content restrictions, I have limited my testimony to only a few.

    Please do not hesitate to contact me directly concerning my experiences. I would be more than happy to share additional information with you.

    I hereby swear that the testimony you are about to receive is true and accurate.
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    Ms. Toni L. Chester
    Sr. Software Engineer
    102 Bradford Lane, Bloomsbury, NJ 08804
    212-259-7138 (daytime)

    Attachment: My experience with the H-1B Visa Program

    My name is Toni L. Chester. I am a forty two (42) year old female American technical worker with one son who I have raised alone. I have over seventeen (17) years of technical industry experience. My academic background entails a Bachelor of Science degree in Applied Mathematics, a Bachelor of Science degree in Statistics; I am four courses shy of a Bachelor of Science Degree in Computer Science. My academic focus was on engineering and computer science in addition to my specified majors. Today, I share my story, on behalf of hundreds of thousands of American Technical Workers.

    At the age of nine (9), I was so engrossed and in love with Mathematics that I purchased my first algebra books at a flea market in Massachusetts. My love of math continued in High School where I excelled pursing an advanced program of study.

    In my senior year, I had planned to go to college and become a Mathematics Professor. I was pulled aside by my physics teacher. He introduced me to the discipline of engineering. He encouraged me to pursue a career and education in Engineering. After all, it was the future of this country.
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    From here, I went to college and obtained my degrees. I had my son. I went to work.

    I worked in the engineering discipline for seven and one half years. During this time, I became much more heavily involved with computers and programming. Although my academic background contained extensive work in the programming disciplines, I had not had the opportunity to fully utilize the skills. With my background in programming, I quickly moved from Steam Turbine Engineering to Software Development, a field in which I excelled.

    I was quickly given increasing responsibility, frequently being named team lead for my assignments. I worked primarily as a contract employee for many leading companies including AT&T, Pricewaterhouse Coopers, Lucent Technologies, Ernst & Young.

    My first experience with the H-1B Visa program occurred at AT&T in Piscattaway, New Jersey. The development team I was on, was comprised of two American developers and three H-1B contract developers. Through conversation with my teammates, I learned that Noel Desouza, Ramkumar (Ram) and Subramanian (Subu) were in the United States through the H-1B guest worker program. Ram and Subu were young men lacking experience. Noel was a few years older, male and experienced. They all made significantly less than me. Through various discussions, I learned that Ram and Subu were paid around $40,000 annually whereas Noel was paid a bit higher. At the time, my salary was $65,000 per year with benefits. Subu barely spoke English and assignments had to be dictated down to the algorithm (step-by-step instruction) level. This took time and energy. Another programmer could complete the work in the time that it took to provide the instruction to him. Subu and Ram were soon replaced for nonperformance and failing to report to work. The replacements, Sagar and Kalyan, were once again young, male H-1B visa holders in their 20s. Our team spent a great amount of time together. We often discussed our backgrounds and how my teammates had come to work in the United States. There were no Americans considered for the positions. I am aware that no Americans were considered for the positions because I was among the team of developers conducting the interviews.
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    Many times, I was put in a position to mentor or train my H-1B peers. At the time, I had no idea that they were in my country to be my replacements. Nor did I realize that the program afforded corporations a means to rapidly escalate the off-shore outsourcing process. The H-1B Visa program is the CATALYST to off-shore outsourcing. Workers are brought to the United States, trained by their American peers, taught project details. The Americans are terminated and the jobs are lost. In the summer of 2003, I read an article concerning my area of expertise and how the positions had been moved primarily to India.

    I was terminated from my contract assignment on the Agere Systems spin project while two young, male, h-1B guest workers from India, Permjit Ghotra and Vic, more than 10 years my junior were retained. This decision was based on the recommendations of an employee, Charanjit Momi. The customer of my services had no input into the decision. The only remaining female, the only remaining American on the team was discharged. At the time, I had just turned 38 years old, I had significantly more experience than my peers and I was the only United States citizen. My skills were not inferior, as I was leading most of the effort. I was often contacted by Vic to assist in his job. When I learned that my contract was ending, I was told to be professional and to train my peer in the work I was doing. My last day was August 31, 2001.

    I was aware that both men were here on an H-1B Visa due to conversations between us. Permjit had returned to India during the course of the project. At that time, he was required to renew his visa, and was thus detained. During this time, he did not communicate with us, so I proceeded with the work alone, having no knowledge of the status of his tasks. Vic joined the IBM team in the Spring of 2001. There were no American workers considered for position. Through conversation, I learned that Vic had been on an assignment in California prior to his arrival in Pennsylvania. He had not been in the country very long. We spoke quite frequently because I was his source of transportation for his visits to the Berkeley Heights, NJ location of Agere Systems.
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    Permjit and I were brought on this project to migrate computer applications from Lucent Technologies to enable Agere Systems to move forward toward their IPO. I joined the project first. Second came Permjit, a young man with whom I had worked in the past. We had the mission to complete the work quickly and without flaw. Upon his return, the project had to move quickly. We had limited time to migrate all the code and the data contained within the Lucent application. As this computer system addressed the Intellectual Property of the corporation, the data migration had to be completed with diligence to allow for the physical separation of the two companies.

    In the meantime, my direct management changed. I was not introduced to the new manager, nor was he introduced to me. Permjit was introduced to the new manager by Charanjit Momi. He was engaged immediately. I was told that the new manager was too busy and didn't have time to meet with me. Several months later, I introduced myself. That was all the contact I had with him until weeks before my contract was terminated. On the afternoon of Monday, August 20, 2001, I was phoned by my consulting firm. I learned in that conversation that my contract would end on August 31, 2001. The H-1B guest worker, Permjit Ghotra, was being retained.

    In the coming weeks, I would learn that jobs were not so easily found. This was the first time in my life that I filed for unemployment.

    At the end of September, 2001, I landed an opportunity that took me back years in my experience. I was no longer using my current skills. Although I knew from the interview that the fit was not good, I had no choice. I could not decline the job by law. If an offer is made, I had a legal obligation to accept it. This position lasted just over a month. In November 2001, I began my long term unemployment. I didn't even have a chance to fight for a job. By January 2002, I was submitting as many resumes as possible regardless of the location. Many positions were only available for a window of two hours. There were so many resume submissions that they could not address all the candidates. Through conversations with local recruiters, I later learned that for every position posted there was a minimum of a thousand resumes presented.
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    Times were rough. I had quickly depleted my available funds. Unemployment paid only a fraction of my mortgage. I could not pay my bills. In July 2002, my unemployment compensation was exhausted. I had obtained one extension. I had only worked three days since November 2001. Afterwards, I ended up living on my tax return. In September, I landed a six week opportunity. The money was low, but it was better than nothing. I was now making significantly less than before, had no opportunity for overtime, had no vacation, holiday or sick pay. I had to commute 75–80 miles each way. The project goals were unrealistic. The company was Accenture.

    After completing the assignment, I opened a new unemployment claim. Over the duration of my unemployment, I had seen one particular job, through Crimson Precision, pop up frequently. Each time, I submitted my resume and received no response. Finally, in November 2002, I learned that the project had gone awry and that the existing development team was being replaced. The assignment was with Pricewaterhouse Coopers. I heard nothing more. Just days before Christmas 2002, I saw the job again. I contacted the company. I passed the technical interview, was hired, started the following day. I learned that three foreign guest had to be terminated for failure to produce. My role was technical writer, with an hourly rate $25/hour less than my previous assignments. I quickly escalated to the lead developer position. I was not offered monetary compensation for the change in position. The assignment was in Manhattan. My commute was 85–90 miles each direction and took hours. I completed the application in 10 months, mostly alone. The project had run several months prior to my arrival. During this time I was unemployed despite being more than qualified to do the job. Once I was given the opportunity I proved I was more than up to the challenge. My employer just didn't think to offer it to me until they had exhausted their supply of H-1Bs.

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    After completing this assignment in September 2003, I was again unemployed. This time, I changed my approach. I sought out Indian based consulting firms. I recalled that Indotronics had supplied the H-1B guest workers to AT&T. Thus, I sent my resume to the Indian branch of Indotronics. I was contacted quickly by recruiters across the country. Discussions began. I was advised of an opportunity at Lucent Technologies in Murray Hill, NJ. The hourly rate for the position was between $28 and $30/ hour. The contract was offered through IBM INDIA. The rates were as is, no benefits. Previously, I had been paid $70–75 /hour with benefits for a similar position at the same client. I thanked them for contacting me and graciously declined.

    My income has dropped dramatically. I have no vacation, no sick pay, no holiday pay, no medical insurance. When afforded an opportunity, I must work every day to barely make ends meet, which they frequently don't.

    We have had no Christmas in years: Thanksgiving is just another day. There is nothing to celebrate, no money for a celebration. In October 2002, my cable was disconnected. We have had no television since October 2002.

    This situation has adversely impacted my son's life. My son is a vibrant, young, intelligent minority who wishes to someday pursue the field of Electrical Engineering. He graduated from high school in June 2005 with honors. He passed both the AP Exam in Calculus and the AP Exam in Chemistry. Today, he sits at home waiting for his chance. He did not attend college this year because of my financial woes.

    In the spring of 2002, while unemployed, having no prospects in site, I had a long talk with my son. The reality had struck, my education and experience was worthless. I told my son that a college education was not a viable avenue or path to pursue. This discussion was very devastating for me. I had to come to the conclusion that my career was over and that my educational and career achievements had no value, at least not in my country. At the time, he was 14 years old.
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    Today, I am forced to live my life in 3 day, 3 week, 2 month, 3 month or 6 month intervals. Nothing is long term. Nothing pays as it had a few years back. In order to survive, I must work every business day that is available to me. I don't get vacation or sick time. My commute is long and tedious. I pay the employers portion of Social Security.

    Every day, I live in fear. I can no longer answer my phone. I'm afraid to pay my bills. Survival is all that I know today. I have no idea how long an assignment will last, thus I have to hoard money in preparation for another long term stay in the unemployment chain. This is the life of an American Technical Worker.

    For the past four and a half months I have been unemployed. The last assignment paid $30/hour less than my going rate; the company, ISI, was in the midst of off-shore outsourcing to India.

    The H-1B program is being used to displace American Technical workers from their opportunities. The H-1B program, in many cases, brings young, less experienced, foreign, predominantly male workers into the country. The American workers are told to train their replacements, then dismissed. I know, because I have done it. I frequently see opportunities listed on job boards seeking only H-1B Visa holders. I have contacted the firms. I have been told that there are no jobs. I have contacted the firms about the FREE training they presumably offer. Most times, they don't respond. When I ask to be offered the training opportunities available, they never call back.

    Five years ago I was one of the most qualified, most skilled and most sought after IT professionals in the country. I have an excellent education in mathematics, statistics and computer programming. My work history is spotless. Yet I am unemployable. I hear that American businesses want hundreds of thousands of H-1B workers next year to fill jobs ''no American can do.'' I am here. I can do these jobs.
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    Nobody calls. Today, I have a homeless plan.