Trump Takes First Step in ‘Buy America, Hire America’ Agenda

By Joe Guzzardi
April 19, 2017

President Donald Trump’s “Buy American, Hire American” campaign is off to a promising start. At a scheduled event at Snap-On, the tool manufacturer in Kenosha, Wis., President Trump promoted his new executive order that assigns the Departments of Homeland Security, State and Labor to draft H-1B visa reforms.
 
The order’s goal, as President Trump emphasized, is to ensure that the 85,000 employment-based H-1B visas (65,000 from the general pool of foreign nationals and 20,000 from the advanced degree exception category) are issued to truly skilled overseas workers, and aren’t used as a vehicle – often fraud-ridden – to displace American engineers or deny them employment opportunities.
 
The H-1B has been a thorn in U.S. IT engineers’ sides since 1990 when Congress created it. For 25 years, Silicon Valley, many in Congress and immigration lawyers have insisted, without evidence, that the H-1B is essential because an acute shortage of qualified Americans forces employers to import labor.
 
Another key talking point that H-1B proponents advance is that more immigration translates into more innovation, and boosts entrepreneurship. However, a look at Census Bureau and Bureau of Labor statistics data contradicts that theory. During the last three decades, the foreign-born share of the U.S. population hit a record 13.7 percent in 2015, while the rate of new business creation declined 35 percent.
 
Despite rhetoric about the essential role the H-1B visa holder plays in today’s America, 13 of the 15 top H-1B visa applications filed with the Department of Labor are global outsourcing companies who pay lower than the prevailing wage, evidence that employers make no serious effort to hire Americans.
 
A wealth of research done during the last few years, some of it by Democrats and liberal-leaning think tanks, found that no IT shortage exists and that the H-1B depresses wages and displaces Americans. Ray Marshall, Secretary of Labor during the Carter administration and author of “Value Added Immigration,” called the H-1B “one of the best con jobs ever done on the American public and political systems.” Marshall further said that no shortage of college-educated workers exists, and that employers pay below the market rate for H-1Bs. In his book’s preface, Marshall criticized the federal government for its failure to develop a guiding national economic policy to regulate the flow of immigrant workers.
 
The Economic Policy Institute, which promotes policies to improve low- and middle-class American workers’ lives, has written extensively on the H-1B, and reaches the same finding each time: H-1Bs have no positive effect on wages or on innovation, and make American workers disposable.
 
Similar research from the U.S. Government Accountability Office, the Treasury Department’s Office of Tax Analysis, University of Notre Dame, the University of California, Berkeley, and the Los Angeles Times arrived at the same disturbing conclusion. Studies can’t analyze the emotional impact on workers of losing their jobs, and having to train an H-1B replacement, insultingly called “knowledge transfer,” to receive their severance pay.
 
President Trump is right to tighten the too-lax H-1B standards. He was elected because of his platform to put Americans first. But if the President wants to make his promise to protect Americans workers a reality, a better solution is to put the dozens of employment-based visas on a temporary moratorium. Wage-earning Americans’ best friend is a tight labor market.
 

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Joe Guzzardi is a Senior Writing Fellow with Californians for Population Stabilization. Contact him at [email protected] and follow him on Twitter @joeguzzardi19.