Domestic Policy, Immigration

Protecting American Workers

The Justice Department just struck a blow for Americans by suing Facebook for abusing the H-1B visa and labor certification process to favor temporary immigrant tech workers.  The action is part of a Trump Administration initiative called Protecting American Workers and addresses a problem with one of the biggest loopholes in the immigration law – the “adjustment of status” rules that allow employers to convert a  temporary H-1B visa worker into a permanent resident.  In order to do so, the employer must file a proceeding with the Department of Labor to obtain a permanent labor certification (called PERM for short) to prove that there are no minimally qualified and available American workers qualified for the job.  The rules require the job to be posted at the employer’s workplace and publicly advertised before the filing of a PERM application. 

The Justice Department’s complaint alleges that Facebook created a process designed to prevent American workers from discovering an open position it wished to fill with the temporary worker and applying for it. For example, it failed to post the position on its public website or accept applications on-line in violation of its own human resource procedures.  It then used the contrived absence of applications to justify hiring the temporary worker instead.  The scheme affected over 2,600 high-paid technical positions with an average salary of $156,000.  The government is seeking not only an end to this gaming of the system, but also civil penalties and back pay for those Americans victimized by it.

As I mentioned in my previous post Immigration – The New Slavery, Big Tech has long been exploiting the H-1B visa system and immigration laws to keep their wages down with the acquiescence of the federal government.  The system cruelly betrays the American Dream by allowing companies like Facebook to import foreign workers to undercut the wage level necessary for Americans to afford the education to win those jobs and support a family. 

Democrats have long relied on big contributions from Big Tech.  The fate of this suit and the Protecting American Workers program will be an important test of President-elect Biden’s pro-worker rhetoric.  Will Biden continue to aggressively pursue these abuses or cave in to big business by ending the program to the detriment of American workers?  The answer will indicate whether this will be the presidency of the American worker or just the globalist elites.        

2020 Election, Antitrust & Trade Regulation, Domestic Policy, Immigration, International Trade, Politics

An American Nationalist Voting Index – The Square Deal

This is part of a series examining the issues in the presidential election. To see other articles in the series, click on the “2020 Elections” link on the Home page

Score

Biden -.5   Trump +2

Roosevelt’s commitment to the working man was born of two incidents of violence in his life that challenged his fundamentally conservative impulses. The first was the assassination of President William McKinley by an anarchist, which led to Roosevelt’s succession to the presidency. The anarchists were the Antifa/Islamic terrorists of their time and arose out of the economic inequality and discontent that were byproducts of the Industrial Revolution. The second was his service with the Rough Riders in the Spanish-American war.  TR saw bravery in both poor cowboys and privileged Northeastern elite in the charge up San Juan Hill and believed their government owed them a “square deal” for that bravery, which he defined as follows:

But when I say am for the square deal, I mean not merely that I stand for fair play under the present rules of the game, but that I stand for having those rules changed so as to work for a more substantial equality of opportunity and of reward for equally good service.

At the same time, he expected the average worker to respond by contributing to his family, community and country, not simply demanding a handout from the government.

In today’s economy, we need to change the rules on economic concentration, trade and immigration to give American workers a real chance to achieve the American Dream of stable and independent financial security. Biden and Trump have verifiable records with successes and failures on these issues.  

Antitrust Law

The abuses of Big Tech have revived interest in antitrust policy and exposed its deficiencies in today’s world economy.  The problem lies in the fact we are still trying to regulate these 21st century monopolies using 19th century laws.  We learned in the 2008 financial crisis that allowing companies to become “too big to fail” created a new form of monopoly rents by allowing elites to privatize profits while socializing their risk of loss.  Meanwhile, Big Tech was finding new ways to leverage customer data to monopolize the Internet advertising and product sales market.  

The Trump Administration’s challenge to the ATT-Time Warner merger attempted to build a case against bigness itself by attacking vertical mergers.  Unfortunately, the DC Circuit Court of Appeals upheld the merger on the grounds it created useful efficiencies, which completely misses the point. They also recently filed a lawsuit against Google over their use of their monopoly power over Internet searches to raise advertising prices. However, Trump failed to pursue modernization of the antitrust laws themselves. Despite this failure, these two innovative suits earn Trump a + .5.

The Obama Administration also had an active antitrust docket and challenged several mergers with limited success.  The losses in both the Obama and Trump Administrations emphasize the need for a modernization of the rules. The Democratic House just released a comprehensive report on Big Tech’s abuses of their market power that could serve as a start for a re-tooling of the statutes. All of this suggests Biden should be given a +.5 on the issue  as well.

Trade

Protecting America and its workers from unfair international trade practices has been an area where the Trump Administration has shined.  They understand the importance of a strong manufacturing sector and have not subjugated American policy to the slow and sometimes hostile mechanisms of the World Trade Organization.  Alan Tonelson of RealityChek has pointed out that the tariffs against China and others have not prevented the manufacturing sector form succeeding during the pandemic without a loss of jobs (see his post from October 19). At the same time, the administration preserved the strategically important partnership between the US, Canada, & Mexico by concluding the U.S.- Mexico-Canada Agreement. Trump deserves a +1 for these achievements.

Biden’s record and positions are almost the polar opposite. He wants to return to the multilateral approach, ignoring America’s unique great power interest in preserving its internal economic strength.  However, he has also said he would relax the Chinese tariffs gradually and only upon concessions from the Chinese. Biden says he would prioritize developing an international coalition to challenge Chinese state capitalism as well.  The latter positions reduce his negative score to a -.5. 

Immigration

Trump’s’ actions to restrict illegal immigration have been divisive, haphazard and often poorly justified on ethnic nationalist grounds. However, they have changed the dynamic and started to limit the use of immigrant workers to compete with Americans (see my post “Immigration – The New Slavery).  However, Trump failed to seize the opportunity to pass comprehensive immigration legislation when he had a Republican Congress.  Because of this failure, he deserves only a +.5 on the issue.

Biden and the Democrats have understandably concentrated on the necessity of legalizing immigrants that have been here for years. They then oppose any real future controls on immigration and would expand the number of HIVB-style visas, thus allowing big companies to use foreign workers to continue to pay substandard wages.    As a result, they deserve a -.5 on this issue.  

Conclusion  

Many other changes in the rules of the game are necessary to give American workers the economic opportunities they deserve.  Mere income redistribution is not enough.   Americans simply want their government to give them a fair chance to compete and contribute; in short, the square deal that TR believed in and for which he fought.

Domestic Policy, Immigration

Immigration – The New Slavery

19th-century New York City tenement dwellers escaping the heat

If I could I would have the kind of restriction which would not allow any immigrant to come here unless I was content that his grandchildren would be fellow-citizens of my grandchildren. They will not be so if he lives in a boarding house at $2.50 per month with ten other boarders and contracts tuberculosis and contributes to the next generation a body of citizens inferior not only morally and spiritually but also physically.”

Speech to the National Americanization Committee, February 1, 1916

This quotation from Theodore Roosevelt came only 50 years after the end of the Civil War – a war fought to end America’s original sin of African–American slavery.  It echoes Abraham Lincoln’s famous quote “As I would not be a slave, so I would not be a master”.  Lincoln and TR knew the temporary benefits of exploitation of an underclass weakened the nation in the long run, both morally and economically.

Yet our current lax immigration system shows we have still not learned this lesson. By failing to effectively enforce the immigration laws for the last 30 years, the federal government has created a new and perpetually renewing socioeconomic underclass.  We essentially have a de facto policy of importing foreigners to perform work for wages below the likely prevailing wage for Americans and with no practical recourse for violations of basic laws governing wages and working conditions.  It is a system that smacks of slavery and betrays our values as Americans. 

This exploitation is not confined to low-wage blue-collar jobs. The H1B visa program has been abused by high-tech and other industries to keep the wages of IT technical workers down by bringing in cheaper workers from Asia and elsewhere and then discriminating against those workers after they are hired.  This often leaves them with high student debt or other expenses and no way to pay it off without postponing for years such basic goals as a family and home ownership.   

The conventional justification for this policy is that companies cannot find Americans who will work at these supposedly low class, inferior jobs. Many who make these arguments claim to be advocates of free market economics. They conveniently overlook the most basic rule of supply-and- demand economics; i.e, that while changes in personal preference can change the equilibrium point on the supply-demand curve, there is always a price at which supply will meet the demand.  In short, as a Federal Reserve Board President pointed out, they can solve the problem by paying more.  Instead, they believe certain jobs have an inherent value that is lower than what the market will bear and it is the government’s job to reduce their wages to this assumed inherent value.  The result has made it more difficult for all workers at the lower end of the labor spectrum to climb the ladder of success and achieve the American dream. 

The recent influx of Central Americans has provided a new source of laborers and a new rationalization for allowing their entry – their potential status as refugees.  Advocates of refugee status for Central Americans ask us to sympathize with them because of the unrest and high murder and crime rates in those countries.  Here are the 2017 homicide rates in Guatemala, Honduras and El Salvador compared to the same statistic for the deadliest American cities during the same period:

2017 US Major City Murder Rates vs. Central America (per 100,000)

  • El Salvador 81.2
  • St. Louis 66.1
  • Honduras 59
  • Baltimore 55.8
  • Detroit 39.8
  • New Orleans. 39.5
  • Baton Rouge 38.3
  • Guatemala  27.3

Sources: Pew Research Center; Council on Foreign Relations

Thus, the advocates of granting refugee status are offering to “shelter” these immigrants by settling them in a country with crime rates that are often worse than the countries they are fleeing from.  Their sympathy for crime victims seems to end at the other side of the American border.

Our high national debt and urgent domestic needs means redistributive taxation cannot solve this inequity.  First, the 11 million immigrants who have lived and worked in the shadows with our implicit consent need to be given legal status and an eventual opportunity for citizenship. We then must say “never again” to such exploitation by adopting strict new limits on immigration and effective enforcement mechanisms. Annual immigration limits should be enacted that are inversely related to the unemployment rate.  The higher the unemployment rate, the lower the immigration limit. Employers should be required to use the E-verify system to insure their workers are here legally. Far from creating more paperwork, it simply would require companies continue to report the social security numbers of new hires as they currently do for withholding tax purposes.

The border needs to be secured, but the best way is with an adequately funded Border Patrol that has sufficient resources to interdict both illegal immigrants and drug smugglers (see this article by a retired agent about the current reality).   We also need more immigration judges and facilities that are flexible enough to quickly adjudicate immigration issues. 

In the end, the most effective and humane way to prevent illegal immigration is to help Mexico and our Central American neighbors control the violence and create more economic opportunity in their countries.  Mexico has begged us for years to stop the exportation of American guns arming the drug gangs against the military. We should set an example of border control and do so. President Trump has failed to fund Obama Administration programs to fight violence and rebuild civil society in Central America.  We should fully fund and expand those programs if we are serious about protecting their citizens and encouraging them to stay in and develop their home countries.

Ending this new slavery will not be easy. Our economy has been built on this exploitation for decades. However, end it we must if we are to be true to our values and secure an opportunity for the American Dream for all Americans.