Won't they just create tons of shell companies then to get around the caps?
They can't get around this as there are tax records of who being paid by whom. This would force company to hire American, reduce fraud, and still being favorable to the big boys paying the lobbying fees. Win win for all who matters (not specifically the regular folks, if they do, it is accidental...)
The entire premise of the H1-B program is when there is a shortage of qualified/available domestic labor. Turning around and tying hiring in the program to having 9x as many domestic employees seems like it's so counter to that notion that not even the government would create such an inanely contradictory policy.