Donald Trump Zig-Zags on ‘Hire American’ Promise

In this Thursday, June 21, 2018 photo, a job applicant looks at job listings for the River
AP/Lynne Sladky
Neil Munro

President Donald Trump told reporters he wants technology companies to import and hire more foreign graduates for prestigious white-collar jobs sought by American graduates.

But Trump also used the same press conference to celebrate the rising blue-collar wages caused by his “Hire American” policies in his expanding economy. Those policies are pressuring companies to hire Americans instead of imported visa-workers or cheap illegal migrants.

The zig-zag policy comes as the rising blue-collar wages boost Trump’s Midwest ratings for 2020, while the stalled white-collar salaries hurt his suburban ratings in 2018 and 2020.

If Trump allows Microsoft, Facebook, Amazon, Google, Intel, and other leading-edge companies to hire even more foreign graduates, they will hire fewer American graduates and pay them less before the 2020 election.

“It is contradictory that Trump wants to raise wages for American and also bring in more workers who will cut salaries,” an American technology professional told Breitbart News. “It is political suicide … because the tech workers believed [in 2016] he was the only one who stood up for them,” said the professional, who fears he will be blackballed by major companies’ subcontractors if his identity is revealed.

In the 2016 campaign, Trump promised to reform the H-1B program. Since then, business-first appointees in his administration have blocked proposed reforms by the U.S. Citizenship and Immigration Services division of the Department of Homeland Security.

Companies use various visa worker programs to keep roughly 1.5 million non-immigrant foreign graduates in the United States. Many of those foreign workers are employed by small contracting firms to fill a series of short-term contracts, so minimizing the major companies’ payroll costs.

Trump’s showed his zig-zag policy in the January 4 press conference just after the Bureau of Labor Statistics announced that wages rose by 0.4 percent in January, setting the stage for a 4 percent rise in wages throughout 2019. Trump praised the wage growth and the resulting return of sidelined Americans to the job market:

One of the things that is so beautiful to watch is 3.2 percent wage growth. That hasn’t happened in so long for our country. That’s an incredible thing. That means people are actually getting more money, taking home more money, and that’s something that is really nice to see. A lot of you have been following me when we were on a thing called the campaign — that was an exciting campaign, a great campaign — and I used to talk about wages going down, not going up, but going down for years. Nineteen years. And now they went up 3.2 percent and yet there’s no inflation because other things are going down, like the price of your gasoline at the tank. It is low and that doesn’t happen by luck. I worked hard on that. That’s like a tax cut for people. So a lot of good things are happening. Labor participation rate increased to 63.1 [percent]. That’s an incredible number also.

 

But Trump also then reversed himself and said companies should be allowed to hire the foreign graduates from U.S. universities:

We need people. We have to have people because we have all these companies coming in. We need great people. But we want them to come in on a merit basis. They have to come in on a merit basis. They can’t come in the way they’ve been coming in for years. I get calls from the great tech companies and they’re saying we don’t allow people at the top of their class at the best schools in the country, we don’t allow them to stay in our country. So they end up going back to China and Japan and so many other countries all over the world, and we don’t keep them. They get educated at our finest schools and then we don’t allow them to – through a various set of circumstances — to have any guarantees of staying. So we lose out on great minds. We can’t do that. We have companies, if we don’t change that, and we’re working on that and we discussed that with the Democrats and I think they agree. We’re working on that. But we don’t want to lose our great companies because we have a ridiculous policy that we won’t accept smart people. So call it politically correct or not, but we have to let these great, brilliant companies have the smartest people in the world.

The 2013 “Gang of Eight” amnesty included a stealth provision which allowed companies to hire an unlimited number of foreign graduates of U.S. universities. If that plan had been implemented, U.S. employers and universities would have permanently flooded the white-collar labor market with millions of very cheap foreign graduates.

Roughly 1.5 million foreign visa-workers hold college-graduates jobs in the United States via the various H-1B, OPT, CPT, L-1, J-1, E-3, H4EAD, TN, and O-1 visa programs. Companies are allowed to hire these foreign workers no matter how many young Americans are applying for the same jobs.

Despite corporate claims, the vast majority of these foreign workers are lower-skill graduates performing starter jobs that could help Americans launch their careers. In fact, the huge H-1B and OPT programs have created an army of staffing contractors which is used by many Americans companies to lock many American graduates out of starter jobs in software, science, and engineering.

Worse, these foreign workers — most of whom are employed as contractors by little-known foreign-0wned staffing companies — usually accept lower wages than Americans because they hope to be paid by winning the hugely valuable deferred bonus of green cards from the U.S. government. Americans cannot get that federal bonus because they are already citizens.

Many of the foreign workers are mid-tier graduates doing work that can be easily accomplished by experienced U.S. graduates.

Only a small percentage of the visa workers are elite people who cannot be replaced even if U.S. companies tried to hire similar American experts away from other Americans companies.

Some of these elite workers are imported via the 0-1 visa program which has no cap. The O-1 visa rules say:

The O-1 nonimmigrant visa is for the individual who possesses extraordinary ability in the sciences, arts, education, business, or athletics …

…

To qualify for an O-1 visa, the beneficiary must demonstrate extraordinary ability by sustained national or international acclaim and must be coming temporarily to the United States to continue work in the area of extraordinary ability.

Extraordinary ability in the fields of science, education, business or athletics means a level of expertise indicating that the person is one of the small percentage who has risen to the very top of the field of endeavor.

The companies’ demand to hire the best foreign graduates is belied by their mass hiring of lower-skill and mid-tier foreign graduates, said the U.S. professional. If the best-ranked foreign graduates “are really that good, they can meet the O-1 requirements,” he said, adding “they are not the best and brightest … [because companies] want the indentured workforce and the cheap labor.”

In 2016 testimony to the Senate, Howard University professor Ron Hira testified that:

41 percent of the [H-1B] workers approved [in 2015] by the government were at wage Level 1 [which is defined as] a basic understanding of the occupation. These employees perform routine tasks that require limited, if any, exercise of judgment …

Level I wages are typically 40% below the average wage.

Almost another forty percent of approved H-1B applications were at second lowest wage level, Level II, which is typically 20% below the average wage for Americans in those occupations.

So, nearly 4-in-5 H-1B applications were approved by the U.S. Department of Labor for the lowest two wage levels, providing large discounts to employers.

The companies’ massive use of H-1B workers can be tracked at H1Bfacts.com, MyVisaJobs.com, and at some government sites. For example, Google sought to hire 4,875 H-1B workers in 2018, sponsored 764 other foreign employees for green cards, and employed 1,501 foreign OPT workers in 2017, even as top managers developed plans to block conservatives’ use of the Internet.

The 1.5 million foreign workers are heavily used by major technology companies and many software companies, banks, insurance companies, universities, consulting companies, accountancy, and engineering firms. The employers are concentrated in California, Texas, and New York, but are also used through the country. For example, many visa workers are being used by banks and insurance companies in Connecticut and North Carolina, even as middle-aged U.S. workers are being fired.

Executives at brand-name companies, including the fiercely-anti-Trump executives at the information technology companies, are pleading with Trump to let them import more workers, and are fighting against plans to eliminate the H4EAD visa-worker program for 100,000 spouses of visa workers.

Their pleas come as rising salaries eat into corporate profits and stock values.  In January, the Bureau of Labor Statistics reported that salaries for information workers rose by 5.7 percent from December 2017 to December 2018. That rate was much higher than the 3.2 percent rise for all workers.

These visa worker programs are little recognized by most voters but are very unpopular among white-c0llar professionals who have seen their colleges get replaces by foreign workers. That unpopularity helped defeat Kansas GOP Rep. Kevin Yoder in November after he alienated college graduate voters in his suburban district by supporting a back-door “country caps” expansion of the visa worker programs.

Nationwide, the U.S. establishment’s economic policy of using legal migration to boost economic growth shifts wealth from young people towards older people by flooding the market with cheap white-collar and blue-collar foreign labor. That flood of outside labor spikes profits and Wall Street values by cutting salaries for manual and skilled labor of blue-collar and white-collar employees.

The cheap labor policy widens wealth gaps, reduces high tech investment, increases state and local tax burdens, hurts kids’ schools and college education, pushes Americans away from high tech careers, and sidelines at least five million marginalized Americans and their families, including many who are now struggling with fentanyl addictions.

Immigration also steers investment and wealth away from towns in Heartland states because coastal investors can more easily hire and supervise the large immigrant populations who prefer to live in coastal cities. In turn, that investment flow drives up coastal real estate prices, pricing poor U.S. Latinos and blacks out of prosperous cities, such as Berkeley and Oakland.

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