if you transfer an H1-B, you are no longer cheap.
The only people who care about hiring the best and the "top 10%" is in the valley. The rest of America is fine with B through D... the reason being you selling to untechnical corporate project managers.
It's better but overall it sounds like the same thing to me.
I've negotiated fairly strongly for my past H1B jobs: again, the strong job market allows this. If the market was weak, then there would be a danger that an employer would have control over whether I could stay resident, and this would provide them with strong leverage. I would be surprised if this was an intended part of the H1B program though: I've certainly never seen anything indicate that it is.
The sort of thing happening to the workers in the article is a form of indentured servitude, which is widely regarded as slavery. I don't believe it is ethical to hold this sort of power over an individual, and IMO, those employers should face jail time. I find it hard to believe a this would be designed into the H2B program.
If you're on a H1B visa, you really need to figure out a plan to a Green Card ASAP, unless you're not planning to stay long term.
You're right about the green card, however even if you can get the employer support you need, it takes years and further restricts your employment options in the meantime.
That's to prevent the exact scenario you mentioned: a company hires cheap foreign labor under the H1B program, displacing qualified local labor.
Of course it's all toothless bullshit, so that's exactly how it works, in practice.