Sen. Grassley vs The Wall Street Journal
Sen. Grassley vs The Wall Street Journal
Date: Tuesday, November 13, 2007 12:27 AM
<<<<< JOB DESTRUCTION NEWSLETTER No. 1782 -- 11/12/2007 >>>>>
Sen. Grassley and the Wall Street Journal had an interesting debate earlier
this month. The imbroglio erupted soon after Senators Chuck Grassley
(R-Iowa) and Bernie Sanders (I-VT) tried to amend the Labor, Health and Human
Services, and Education Appropriations bill with a $3,500 visa fee increase
for H-1B visas. The Wall Street Journal strongly criticized the two senators,
and even went as far as calling them "liberal protectionists."
Grassley didn't take the WSJ attack lying down. He fired back at the WSJ with
an op-ed just six days later. In it, he said that the WSJ's cavalier attitude
was a "smack in the face to the American worker." Grassley's op-ed was quite
unprecedented and it was quite a shock that the WSJ published it.
The $3,500 fee was to be used to fund a scholarship program for U.S.
students pursuing tech and science-related degrees. However well intentioned,
the senators were trying to solve a problem that never existed in the first
place. The two senators are stuck in the paradigm that there is a shortage of
science and technology students when we are actually producing more graduates
than the market is creating jobs. Having said that, I still enjoyed seeing the
amendment because it stuck a finger in the eyes of the cheap labor lobby. A
fee of $3,500 is nothing compared to the wages employers save by hiring H-1Bs,
but that didn't stop the corporate shills at the WSJ from screaming bloody
murder. They would probably complain if the visa fee was raised by one cent.
This story could have been an epic confrontation but instead had an anti-
climatic ending. Soon after Grassley's op-ed was published the Senate axed the
amendment, and the controversy died.
By reading the articles below, you can piece the story together. The WSJ
removes articles after seven days so links aren't provided.
Articles included
The Grassley Visa Tax
Wall Street Journal, November 2, 2007
Investing in America, Making Things Worse
Wall Street Journal, November 8, 2007, by Sen. Chuck Grassley (R., Iowa)
http://www.informationweek.com/news/showArticle.jhtml?articleID=202803623
Congress Axes Amendment To Triple H-1B Visa Fees
http://www.informationweek.com/news/showArticle.jhtml?articleID=202601183
Senate Bill Could Triple H-1B Visa Fees Paid By Employers
+++++++++++++++++++++++++++++++++++++++++++++++++++
02 Nov 2007, 03:33 PM EDT
The Grassley Visa Tax
November 2, 2007; Page A12
Wall Street Journal
Congress has failed to pass immigration reform, so industries that depend
on foreign workers have already been left in the lurch. But Senator Chuck
Grassley now wants to make things worse.
Last week Mr. Grassley, the Iowa Republican, slipped an amendment into a
spending bill that would tax businesses that hire skilled immigrants an
additional $3,500 per visa to a total of $5,000 each. According to the
National Foundation for American Policy, this represents a $3.1 billion tax
increase over five years on some of America's fastest growing companies.
Companies employing foreign professionals who are here on H-1B visas
already pay $1,500 per individual. The fee was originally set at $500 in
1998, but at least past increases have also included a rise in the number
of available visas. When Mr. Grassley floated this tax back in April, it
would have been part of a Senate bill that lifted the H-1B visa cap by
50,000 and put in place an escalator provision that allowed market demand
to determine future increases.
But the Grassley Tax proposed last week includes no such trade-off, leaving
the H-1B visa cap of 65,000 per year intact. The need to increase this
arbitrary quota, if not eliminate it, is clear. This year, the U.S.
Citizenship and Immigration Services received approximately 120,000
applications for H-1Bs on the first day they were available.
In addition to the hiring fee, current law already requires H-1B
professionals to be paid the higher of the prevailing wage or actual wage
paid to Americans in similar positions. So it's not as if U.S. businesses
pursue foreign engineers, computer scientists and the like because they're
cheaper to employ. Nor are these foreign workers overrunning the country
and displacing Americans. In 2006, new H-1B professionals comprised 0.07
percent of the labor force.
Citing anecdotal evidence -- "People have called our office," a spokeswoman
tells us -- Senator Grassley says the fee increase is necessary to combat
abuse and fraud. But the back wages owed to H-1B hires amounted to just
$4.6 million in 2006, down from $5.2 million the previous year. In a $12
trillion economy, those numbers are infinitesimal. Department of Labor
investigations reveal that some 90% of violations are paperwork offenses
and good-faith misunderstandings.
The Senator also maintains that his tax increase is needed to fund more
federal programs for high-achieving U.S-born students, who are notoriously
underrepresented in math and science. Leaving aside the dubious notion that
the federal government doesn't spend enough money on education, the
high-tech industry has already shelled out more than $2 billion to fund
scholarships over the past decade. And that's not counting their other
philanthropic efforts, nor the state and local taxes these companies pay to
support public education.
Mr. Grassley's justifications notwithstanding, the reality is that these
skilled foreign nationals help U.S. companies compete globally and keep
jobs and innovation inside the U.S. This is especially important when other
countries are opening their doors to this human capital. The European
Union, which says it's facing a shortage of some 20 million skilled workers
over the next two decades, has announced plans to streamline its
immigration process to attract foreign talent.
So while even European bureaucrats are wising up to the importance of
attracting global talent to keep an economy competitive, a Republican
Senator is joining liberal protectionists to move the U.S. in the opposite
direction. Go figure. If Congress can't see its way to fix our broken
immigration system, the least it can do is not drive more jobs offshore.
+++++++++++++++++++++++++++++++++++++++++++++++++++
Investing in America, Making Things Worse
Wall Street Journal
November 8, 2007; Page A21
Sen. Chuck Grassley (R., Iowa)
Washington
I'm startled to learn that The Wall Street Journal seriously believes that
an investment in American students will make things worse for U.S.
businesses ("The Grassley Visa Tax," editorial, Nov. 2).
Your editorial asserts that the number of foreign workers on H-1B visas is
so minimal that we shouldn't care if Americans are in fact displaced. I
challenge the Journal to wave their labor force figures in the face of one
of the hi-tech workers who have had to train their own replacement who is
an H-1B visa holder. That's a smack in the face to the American worker and
hardly an issue to take lightly.
I am committed to an effort to include additional H-1B reforms and increase
the visa supply along with an increased investment to educate Americans.
But, I strongly disagree that the only solution is to increase our reliance
on foreign workers by raising the annual cap. Reforms to the program must
be a top priority. Big business cannot continue to ignore the home-grown
American talent who should be getting at least a good portion of these
jobs.
+++++++++++++++++++++++++++++++++++++++++++++++++++
http://www.informationweek.com/news/showArticle.jhtml?articleID=202803623
Congress Axes Amendment To Triple H-1B Visa Fees
The additional $3,500 that employers would've been charged for each H-1B
visa had been earmarked to fund scholarship programs for U.S. students.
By Marianne Kolbasuk McGee, InformationWeek
Nov. 7, 2007
Looks like Congress will remove from a spending bill a controversial
amendment that would've more than tripled fees paid by employers for each
H-1B visa applicant and created a new scholarship program for U.S. students
pursuing tech-related degrees.
U.S. House of Representatives and Senate conferees hammering out
compromises for a $150-billion-plus appropriations bill have dropped from
its final conference report an amendment that would've hiked H-1B visas
fees to $5,000 from the current $1,500.
H-1B visas are the most common visa sought by employers to bring foreign
technology professionals into the U.S. to work temporarily.
The additional $3,500 that employers would've been charged for each H-1B
visa had been earmarked to fund scholarship programs for U.S. students,
including the proposed merit-based American Competitiveness Scholarship.
That new scholarship program would've enabled the National Science
Institute to award qualified American students with scholarships of up to
$15,000 annually to pursue degrees in computer science, mathematics,
engineering, nursing and medicine.
The dropped Grassley-Sanders Amendment, co-sponsored by Senators Chuck
Grassley (R-Iowa) and Bernie Sanders (I-Vt.), had been passed by the Senate
twice before -- in May as part of Congress' ill-fated comprehensive
immigration reform bill, and just last month as part of its version of the
labor, health and human services and education appropriations bill.
Raising the cap on H-1B visas -- along with many other assorted proposals,
including H-1B anti-abuse, anti-fraud provisions, and changes in green-card
processes and policies, were all part of controversial and comprehensive
immigration reform legislation that Congress had been considering earlier
this year.
+++++++++++++++++++++++++++++++++++++++++++++++++++
http://www.informationweek.com/news/showArticle.jhtml?articleID=202601183
Senate Bill Could Triple H-1B Visa Fees Paid By Employers
The amendment, passed Tuesday, would tag on an additional $3,500 per visa
to be earmarked for U.S. scholarships.
By Marianne Kolbasuk McGee, InformationWeek
Oct. 24, 2007
The fees paid by employers for each H-1B visa applicant they seek to hire
could soon more than triple. The additional fees are earmarked for a new
scholarship program for U.S. students pursuing tech and science-related
degrees.
The U.S. Senate Tuesday passed an amendment to raise H-1B visa fees to
$5,000 from $1,500 currently. The amendment was tagged onto a $152 billion
spending bill that was also approved by the Senate last night.
The same Grassley-Sanders Amendment, co-sponsored by Senators Chuck
Grassley (R-Iowa) and Bernie Sanders (I-Vt.), had been passed by the Senate
once before -- in May as part of Congress' ill-fated comprehensive
immigration reform bill.
But now with the comprehensive immigration reform bill dead, the
Grassley-Sanders H-1B fee legislation was reintroduced and approved by the
Senate as an amendment to the Labor, Health and Human Services, and
Education Appropriations bill. That bill is now in conference for
negotiations between the House of Representatives and Senate.
If the spending bill is passed by Congress and signed into law by President
Bush with the Grassley-Sanders amendment still intact, employers would pay
about $3,500 more in government fees than they do now for each H-1B visa
petition.
The bill does not raise the H-1B visa cap, which currently stands at 85,000
annually, which includes 20,000 exemptions for foreign students earning
advanced degrees from U.S. schools.
The amendment calls for $3,000 of the fees for each H-1B visa to fund a new
merit-based American Competitiveness Scholarship program for U.S. students
seeking associate, bachelor's, or graduate degrees in computer science,
engineering, mathematics, nursing, and medicine.
The program would enable the National Science Institute to award qualified
individuals with scholarships of up to $15,000 annually.
In addition to the American Competitiveness Scholarship, $500 in fees for
each visa will fund another scholarship program, the Jacob Javitz Gifted
and Talented Program.
Currently, portions of the $1,500 in fees that are paid by employers for
each visa are earmarked for training programs for U.S. workers.
A spokesman for Sen. Sanders says that if companies want to hire foreign
workers for jobs in which they claim there are talent shortages, those
companies "should pay to help U.S. students fill those shortages in the
longer term."
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