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Comment by koolba | Hacker News Reader

What's the argument against using an auction for H1-B visas rather than a lottery? That'd maximize the tax collected from their salaries and ensure the salaries are on par with the going rate for said workers. Arguably it's in the interests of everyone besides companies trying to get cheaper labor via H1-B visas.

The only counterpoint I've ever heard is "It's not fair for company XYZ in low cost of living Podunk, USA because we can't compete at those high salaries against banks / SV / expensive cities". So what? I doubt they can compete against the ability of TCS or Infosys to game the system and get the lions share of the visas either.

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The objective of the visa is to enable business. It is beneficial to America that business flourishes in America. If a pharma business is viable only if it pays $100k to its researchers and if it is being hamstrung by lack of researchers in America it doesn't matter that a software engineer can charge $200k for his services.

The pharma researchers may argue that this should present an upward price pressure on their salaries but their industry isn't solely driven by salaries alone.

At the higher salary that gets a company enough researchers, the company may become unviable. In addition, if there are only 100 researchers and there are 1000 jobs, rising salaries will still leave 900 jobs unfulfilled.

These are things one doesn't care about if one is a researcher because systemic economic slowdown will take a while to catch up to you because there are more jobs than researchers.

But thinking above that in the long term, it is advantageous to have more researchers since more jobs filled leads to more successful companies which leads to growth.

In truth it's more complicated. There are a large number of unqualified people who carry the credentials claiming they're qualified. For the same title, skill levels vary substantially. This is why people believe good lawyers are far better than average lawyers, that good doctors exist, and that the concept of a good software engineer exists.

This means that while there is apparent supply, there is no real supply. This makes the problem less apparent but no less real.

The government distorts markets for its own reasons and one of them is the long term economic health of the country. The most efficient distribution may be that most companies should be in Africa. The government doesn't want that. It wants companies in the US. It organizes in the long term to allow this.

If that's the long term goal, then the US government is going to have a problem things such as the internet, bitcoin and more technologies open up even more possibilities for foreign workers and freelancers to work from abroad and avoid US taxes all together.

> If a pharma business is viable only if it pays $100k to its researchers and if it is being hamstrung by lack of researchers in America it doesn't matter that a software engineer can charge $200k for his services.

True, but in another sense, more people will train to be software engineers than pharma researchers? educated people are the common resource? Why should anyone train to go into pharma, when they could earn more as sw devs?

> their industry isn't solely driven by salaries alone

what does this mean?

> if there are only 100 researchers and there are 1000 jobs

Are jobs are not equal. Ultimately, there are only 100 jobs willing to pay a higher salary. Consider an auction, there are not really millions of buyers willing to buy an iphone (at $1), there is just one, the rest lost interest once the price point had been hit.

I understand, an industry can still be hamstrung by lack of employees, but

a) Would this be different in the US compared to other countries? If not, all similar industries will be equally slow to progress; No problem for the rare employees living in good times.

b) If the industry is desirable, people will begin to train for it, or be encouraged to train; high salaries will be just one incentive. In the meanwhile, the growth of the fledgling industry can be helped via investment: this investment could help provide aforementioned training, and also help pay for foreign labour at higher cost than than native, so as not to undercut native labour - hence the nonviable industry is subsidised until labour supply catches up.

> it is advantageous to have more researchers since more jobs filled leads to more successful companies which leads to growth

"job creation" theories are dangerous, much like trickle-down economics. It's easy for the wealthy to act in their own interest by promoting flawed justifications of this nature. I agree, certain high-skilled jobs actually fuel certain struggling industries than actually bootstraps industry in a way that makes existing workers more valuable, especially locally (vs nationally); but I can see how this line or argument, which applies to rare cases, can be abused to argue similar effect where it is not the case; Is is also the case that there would be an point where the visas must stop (when the benefit ends), which again it would be easy to manipulate - you'd need strict criteria to make it fair.

The points I've seen and agree with for an argument against an auction is:

- It is a tacit acceptance of the falsehood that there is a skills shortage.

- It ultimately relies on scarcity of visas. There will be a number of visas to auction off and this number will become a political football that is tweaked and tweaked until it is meaningless. What is the point of an auction if there are a million visas being auctioned off?

- It does not address the corporate/education institution partnership loophole.

Ultimately if they are the best and brightest the visas should be given to the employee not the employer and, if the employee wants, they should be put on a fast track to a green card as soon as they start (6 mo-1 year)

> It is a tacit acceptance of the falsehood that there is a skills shortage.

The entire premise of the H1-B program is that there is a skills shortage. It's not specific to IT, it can be used for any field where you cannot find local talent.

> It ultimately relies on scarcity of visas. There will be a number of visas to auction off and this number will become a political football that is tweaked and tweaked until it is meaningless. What is the point of an auction if there are a million visas being auctioned off?

There's already a number of visas auctioned off. I don't see how the number is any more or less political if it changes to an auction based on salary.

> It does not address the corporate/education institution partnership loophole.

I don't know what you're referring to here. Please explain.

> Ultimately if they are the best and brightest the visas should be given to the employee not the employer and, if the employee wants, they should be put on a fast track to a green card as soon as they start (6 mo-1 year)

The visa already goes to the employee, not the employer. H1-B visa holders can move jobs if the new company is willing to take over the H1-B sponsorship (I think it's just a bunch of paperwork).

> The entire premise of the H1-B program is that there is a skills shortage

And it's a bad program even if that was true, since at best it's a band aid that papers over short-term symptoms without addressing underlying problems, and since it is perennially used in the same industries for the same types of jobs, it's clear that if it is addressing a skills shortage, it's not a transitory, short-term problem for which a short-term patch to cover up symptoms is the appropriate response.

Either no one involved in making policy has noticed this, or "skills shortage" isn't the actual reason for the policy.

Considering things from the point of view of the immigrant, the current h1b system seems to me like the only route to immigration for a person who is not exceptionally skilled or wealthy or connected. So there are definitely people who would like to immigrate who would lose out if it became an auction.

I'm not saying those people should necessarily be a major consideration, but you did say "everyone besides companies trying to get cheaper labor".

> Considering things from the point of view of the immigrant, the current h1b system seems to me like the only route to immigration for a person who is not exceptionally skilled or wealthy or connected. So there are definitely people who would like to immigrate who would lose out if it became an auction.

Sure but the point isn't to provide a side door for immigration, it's supposed to be for filling short falls in labor that cannot be accommodated locally.

> I'm not saying those people should necessarily be a major consideration, but you did say "everyone besides companies trying to get cheaper labor".

That's correct though I was specifically thinking from the perspective of the USA, its citizens/permanent residents, and its corporations (both those trying to get H1-B applicants and those that aren't).

It's not necessarily just immigration. Many young people I know have moved countries for a few years to experience a new culture, climate or whatever whilst working there. Some stay, some don't. The US makes that really hard/impossible, especially if you want to stay. So what? Well, many visa arrangements are reciprocal...

H1 is a non immigrant visa; using for that purpose is fraudulent. Under the law, H1s should have no right to permenant residency unless they return on a proper immigrant visa -- otherwise, its vastly unfair to those that go through the legitimate process.

H1b is a dual intent visa. No crime in having immigration intent while on it.

H1B is dual intent. Meaning that it is absolutely within the law to apply for permanent residency via the normal EB2/EB3 process.

Apropos of anything else, a lot of the definitions are weird.

I came here on a K-1 Fiancee visa. Which was, ostensibly, a "non-immigrant" visa. Though it allowed the ability to live, work. And to remove conditions on permanent residency by submission of a form.

I just wanted to thank you for putting the point of view of an aspiring immigrant into the conversation. Just recently my sister completed a coding bootcamp in NYC and would gladly accept all the 'abuses' associated with being an H1B holder and then some to be able to work as a software developer in the US.

I ask for no special treatment for my sister, just the decency of not using the immense power of the state from preventing her for working for a willing employer. Sort of how we don't ban black people from working as software developers even if they replace white people.

The argument is probably that you'd end up in a situation where the highest-paid fields get all the H1-Bs and the lowest-paid fields get none. Workers in that highest-paid field would still get their salaries undercut and, in those lesser-paid field, there would be problems finding people with the right skills.

I'd favor a policy that looks at the ratio of citizens/green card holders to H1-Bs when determining priority. Want more H1-Bs? Hire more citizens and green card holders. This is similar to what other countries do in mandating that a certain number of locals be employed before you can employ a foreigner.

This both addresses the CoL objection you cited as well as the type of business objection I listed. But it would also destroy the body shops that basically only employ H1-Bs.

> Workers in that highest-paid field would still get their salaries undercut

There are arguments that this isn't the case, though a bit out of my league.

> in those lesser-paid field, there would be problems finding people with the right skills

If a job requires a rare, yet specific skill, then why is it lesser-paid?

I guess an argument could be made that this would only maximize short-term tax revenue, and only tax revenue that is, as you said, collected from income taxes, which might or might not correlate to the guest worker's long-term direct and indirect contributions to the federal budget (and the American economy in general).

> I guess an argument could be made that this would only maximize short-term tax revenue, and only tax revenue that is, as you said, collected from income taxes, which might or might not correlate to the guest worker's long-term direct and indirect contributions to the federal budget (and the American economy in general).

All else being equal, I'd wager that the long term tax revenue collected from a guest worker with a higher starting salary will be more than one lower starting salary.

Tax revenue is a function of the worker's salary. Higher starting salaries will lead to higher salaries down the road.

something something democracy.

The country is run (roughly) on something resembling democracy and equality. If, instead, the ethos changes to "more power to people who pay more", we give up any pretence at democracy. We might as well just advertise that politicians are for sale.

Which the mostly are right now, but at least they have to pay lip service to the people. Once that's gone, the culture of the country will change enormously. And not for the better.

See William Shirer's "Collapse of the Third Republic" for what happens to countries in this situation. It's less well known than "The rise and fall of the third reich", but I found it a lot more informative.

https://en.wikipedia.org/wiki/The_Collapse_of_the_Third_Repu...

> something something democracy.

> The country is run (roughly) on something resembling democracy and equality. If, instead, the ethos changes to "more power to people who pay more", we give up any pretence at democracy. We might as well just advertise that politicians are for sale.

What's not democratic about optimizing need based upon projected tax revenue? Are we discriminating against "poor companies"? Would you classify companies that allow their employees to work remotely doing the same? (ex: I'm sure Google can pay more for a remote employee than any local company in Podunk USA).

I personally have no horse in the H1-B race. I don't employ any nor do I intend to apply for visas. The vast majority of citizens and permanent residents in the USA are in that group as well. It's in their interests to raise the price of said foreign labor. I'd say that's very democratic and keeping the price of it artificially low is short changing democracy.

> What's not democratic about optimizing need based upon projected tax revenue? Are we discriminating against "poor companies"? Would you classify companies that allow their employees to work remotely doing the same?

The unstated assumption in your questions seems to be that optimizing for revenue should be the #1 (or a high) priority for a government.

If so, why not just cut all social programs? They're expensive, and the poor people can find jobs, right?

My leaning is more towards the idea that governments should optimize for something else. Perhaps "the greater good", however the citizens decide that. Money is always an issue, but optimizing for tax revenue is a little to inhuman for me to be comfortable with it.

> It's in their interests to raise the price of said foreign labor.

... to artificially raise the price of foreign labor. Many companies now are trying to artificially lower the price of foreign labor, through lobbying, etc.

And the foreign labor market is in no way free. When I worked in the Bay area, it was well known that many H1B holders were paid low salaries, and treated like crap. Because they wanted to stay in the country, and were willing to accept hardship in order to do so.

That artificially lowered the labor cost, and lowered salaries. If they were paid the same as local talent, the artificial low cost would go away, and more local talent would be hired.

>> What's not democratic about optimizing need based upon projected tax revenue? Are we discriminating against "poor companies"? Would you classify companies that allow their employees to work remotely doing the same?

> The unstated assumption in your questions seems to be that optimizing for revenue should be the #1 (or a high) priority for a government.

> If so, why not just cut all social programs? They're expensive, and the poor people can find jobs, right?

Social programs aren't revenue, they're an expense.

> My leaning is more towards the idea that governments should optimize for something else. Perhaps "the greater good", however the citizens decide that.

The beauty of using something objective like salary or even a pure auction where the USA sells the via to the highest bidder is that it's objective and consistent. "Greater good" is a feel good (no pun intended) term that has no objective meaning. It may make you feel better that you've provided a job to a third-world immigrant but that doesn't mean it's objectively a good thing for the USA. And at the end of the day the foreign policy of the USA is for its own interests (which may align with global ones but not at the expense of USA ones).

> Money is always an issue, but optimizing for tax revenue is a little to inhuman for me to be comfortable with it.

If you don't pick something objective where at least the government can get a fair share of the money, you'll end up with outsourcing firms gaming the system. It's the immigration equivalent of "this is why we can't have nice things".

>> It's in their interests to raise the price of said foreign labor.

> ... to artificially raise the price of foreign labor. Many companies now are trying to artificially lower the price of foreign labor, through lobbying, etc.

It's not artificial at all. It's the price of providing that same service locally which is what the H1-B's salary is supposed to be anyway.

If the foreign labor wants to provide that service remotely, more power to them. Let them do so. But if it's done in SF, or NY, or anywhere in the USA, the prevailing labor rate is what should be paid. The point isn't to provide cheap labor to firms. It's to fill gaps in the labor market (or at least that was supposed to be the point).

> And the foreign labor market is in no way free. When I worked in the Bay area, it was well known that many H1B holders were paid low salaries, and treated like crap. Because they wanted to stay in the country, and were willing to accept hardship in order to do so.

> That artificially lowered the labor cost, and lowered salaries. If they were paid the same as local talent, the artificial low cost would go away, and more local talent would be hired.

Well duh. That's what I'm trying to say!!

> Social programs aren't revenue, they're an expense.

That's nit-picking. Social programs are negative revenue. If you want to maximize income, you can increase income, or decrease expenses. This is grade 5 math.

> "Greater good" is a feel good (no pun intended) term that has no objective meaning.

"Greater good" can be define to mean that it matches societies preference. i.e. long life, healthy life, whatever.

If only the constitution defined greater good.. perhaps something about "life, liberty, and the pursuit of happiness"?

>> Social programs aren't revenue, they're an expense.

> That's nit-picking. Social programs are negative revenue.

No it's not nit-picking, it's basic accounting. If you want to maximize income, you can increase income, or decrease expenses.

Revenue impacts your top line gross. Expense impacts your bottom line net. Income != Revenue.

To use an extreme example, if I have $1M of expense and zero revenue, no matter how much expense I cut I'm not going to turn a profit as you can't go below zero. Conversely, if I have $0 of expense and $1M of revenue, I can continue to increase income by raising revenue.

> This is grade 5 math.

No it's Accounting 101.

> "Greater good" can be define to mean that it matches societies preference. i.e. long life, healthy life, whatever.

> If only the constitution defined greater good.. perhaps something about "life, liberty, and the pursuit of happiness"?

It's not an objective measure though.

> To use an extreme example, if I have $1M of expense and zero revenue, no matter how much expense I cut I'm not going to turn a profit as you can't go below zero. Conversely, if I have $0 of expense and $1M of revenue, I can continue to increase income by raising revenue

Show me a government with zero revenue, or a government with zero expenses, and I'll believe you.

Until then, it's still nit-picking.

At the scale of governments, expenses == -revenue

America is not a democracy. It is a representative republic.

Meaningless distinction based off the differing meanings of 'democracy'. It's a constitutional representative democracy that is also a republic.

I don't even agree that a move like this takes power from the people but the democracy/republic distinction wasn't even relevant.

In the labor market I'd say we gave in to "more power to people who pay more" [1] quite some time ago, and rightly so.

1. Like e.g. employees, all other things equal, tend to work for the employer that pays better. That gives more power to employers that can pay more.

In a free labor market. The labor market inside the country is mostly free. People can move to where the jobs are.

The labor market for foreigners isn't free. There are restrictions in place to prevent foreign immigration.

If it's cheaper to import someone from India rather than Montana, is that OK? If so, why? If not, why not?

> If it's cheaper to import someone from India rather than Montana, is that OK? If so, why? If not, why not?

As I understand the reasoning behind the H1B visa program:

If it's just cheaper, then it's not ok, essentially because workers in Montana should be protected from wage competition. But if it's unlikely that someone in Montana could / wants to do the job, then it's ok, because then there is no competitive situation and the interest of the business / economy to fill a position takes precedence.

Isn't a good way to ensure that to just raise the bar in terms of wage? If a business has to pay $150k/y for a H1B worker (because otherwise they won't get the visa) then they'd probably prefer a comparable candidate from Montana for $140k/y. If they still hire the H1B it's because nobody in Montana wants to / can do the job for $140k/y, so no wage competition (except of course if someone in Montana does want to do the job for $160k/y - but in that case they're perhaps not in desperate need of "protectionistic intervention" from their government).

So to me it seems an "auction" allocation strategy for H1B visas would strike a pretty good balance, raising the wage bar when demand for visas go up (and lowering it if/when demand goes down).

Most countries today will give you citizenship if you pay enough.

Source please. From my experience, this is not even close to true. You might gain a residence visa that after several years might yield citizenship, and even this is not available in many countries.

Ok democracy. Let's put H1 policy to a vote.

Democracy has nothing to do with equality of outcomes: it's about the representation of the citizens.

Why can't I easily get an oil exploration license but some multi-national can? I can't afford millions of dollars. But with a license, I'd have a scarce resource and could easily raise money to drill.

Why aren't radio frequency spectrums allocated by a lottery system? Why is surplus federal equipment sold at auction and not just sold to the first person that shows up?

Pricing is an excellent regulatory mechanism. It works -- until the system is gamed by the well-connected.

Making third Reich comparisons, even tangentially, seems like an unnecessary Godwin.

> Making third Reich comparisons, even tangentially, seems like an unnecessary Godwin.

Insults like this are unethical, especially when you didn't bother reading the link I posted.

The reference was to France, not to Nazi Germany.

I've seen rather a lot more of this on HN recently. People who automatically assume that the comments they're replying to hide some kind of nefarious evil intent.

Stop it. It's anti-social and abusive.

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