H1B dilemma

There has been a huge debate going on about the H1B visas and the topic does bring up complex issues with no easy resolution.

One the one side, those for the visas claim that the H1B visas allow companies, especially the tech companies, to bring in highly talented people with skills that they can’t find in the US. That one makes sense to me because you do want the best to be in the US rather than creating competition elsewhere.

The other side though has two parts (to me): the more racists part that simply does not want any immigration, legal or otherwise. And then the other part where the claim is that companies can find American workers with the desired skills, but they just want to bring in vulnerable people, specifically Indians, as “indentured servants” who will work long hours at lower pay. I can see some validity to that claim.

Why?

Breaking the social contract between business and workers

Well, for about 30 years Americans had watched companies first outsource manufacturing jobs overseas and then later tech jobs because the wage levels are extremely cheap. Supposedly same talent at lower pay. It is not a huge jump to think that H1B visas is just a cover for bringing in cheap labor.

For thirty, forty years, Americans have endured the outsourcing, the thumb on the minimum wage, and the general shrinking of benefits while their productive output soared. There used to be a connection between rising productivity and rising wages, but that connection has been severed.

All of the productive gains basically went into the investors’/shareholders’/senior executives’ pockets. Those investors and shareholders really didn’t do anything to earn those gains: they just contributed money, possibly once, and then just sat back and watch the stock price rise as workers get laid off, time and time again.

Who are the shareholders?

By the way, who are the shareholders? In theory they could be regular people like you and me investing in the stock market and thus are part of the class of people who have received the productive gains.

You buy that?

For the longest time I couldn’t get an answer to that question: who were participating in the stock market. Until one day, I read an article that included an image of the breakout:

The top 10% owned 93% of the stocks.

So, yeah, those gains should be split between the two rather than get channeled to just one pocket.

Anyway, the viewpoint of those saying that the H1B visas is just a front to keep wages low by using vulnerable people is very understandable and could be true.

It’s hard to tell though.

Tone deaf responses of tech bros

Compounding the issue of this debate are the responses and behavior of the two tech bro billionaires. They kind of come across as tone deaf and very insulting.

One of them said that Americans venerate jocks over the math wizards. I can kind of see where he is coming from because the movies, way back when, did glorify the football hero and the cheerleaders, like those were the people we should aspire to. Even where I live, schools and families just glorified the football players.

Plus, sometime during George W. Bush (the son), there was a lot of anti-intellectualism in the US, with George Bush leading the way.

But you have to think from their standpoint: most of us are average people, some with no hope of doing grand things intellectually. They have to find their glory elsewhere.

And saying that American culture is poor and venerates the jocks in a very haughty sounding way will just rub Americans wrong.

The other tech bro came across as very insulting. I got the impression that he thought Americans were stupid. As a matter of fact, they both seemed to think very highly of Indians. I got the impression that they viewed that there were more smart Indians than Americans.

Some statistics on IQ

If my impression is correct and they do find Indians to be smarter, then let’s do some statistics. First, let’s look at population:

US population as of 2023: 334,900,000 (334.9 million)
India’s population: 1,429,000,000 (1.429 billion)

India’s population is a 4-fold increase over the US’s population! As a matter of fact, I think it was sometime in the last decade that China had a greater population than India but as of 2023, India’s population is just a touch more than China’s. The Indians have been busy!

Since we are talking about intelligence, let’s do some statistics on IQ, assuming normal distribution of IQ scores. Historically, it has been said that college students typically have IQ of 115 or greater. According to the IQ normal distribution that I’ve found, 115 and greater represented about 16% of the population. The 130 to 145 range (genius range) is about 2%, so 115 to 130 is 14%.

The link is
IQ distribution in the United States (and more) | by Mike Sage | Medium

14% of the Indian population makes 200 million. That is 60% of the US population, which includes children. The smart people of India just about wipes out our population in terms of number of people. Yeah, India will look like they have a lot more smart people, just by the larger population number.

And you know there are not enough good jobs for everyone.

So, who is right in this debate?

I have no idea. If the tech bros truly cannot find the talented people in the US, then I can see reaching out to India to bring in some very talented tech people because we rather have them here rather than over there competing against us.

But, if the tech bros are just reaching into India because they can get really talented people for a lot less, I understand the idea that Americans should be considered first if they have the same skillset and talents.

I wish someone economist would come up with an economic reason why focusing on shareholders alone is a bad idea for the long-term health of companies and society. We need to destroy of the Milton Friedman doctrine of profit maximization for shareholders.