United States Holding Workers from India to Ransom
I want you to think about these numbers for a moment. According to the Central Intelligence Agency (CIA) estimates the GDP of the United States is $14.26 trillion (2009). For the same period India’s GDP was $1.16 trillion. American defense spending was approximately $663 billion for 2009 which is more than half of India’s GDP.
Numbers like these are important to know if you are from India or China. Although both these countries are growing fast (8% to 12% every year) there is still a huge gap between the size of the American economy and that of the Indian and Chinese economies. We have to grow at our current rates for the next couple of decades to be in the same ball park as the United States. This is highly unlikely because economic growth is cyclical. But you might think that a country that rich as the United States might be able to pay for everything. Think again.
But we know that a nation ceases to have the influence and power that it once had long before it ceases to be a superpower (empire is the old word). The GDP of the United Kingdom is twice that of India. But anyone who followed British Prime Minister David Cameron’s visit to India last week would realize that Britain needs India, investments from India and access to Indian markets a lot more than the other way around.
The United States has made serious financial, foreign policy and military decisions in the past ten years that will have severe long term impact on its status as a superpower. It is fighting two wars that it cannot afford to pay and is conducting internal polices that are mostly designed to placate the current population and push the tough decisions that have to be made to future generations.
The United States senate has voted to improve security along its border with Mexico by adding 1200 additional agents and unmanned aerial vehicles. This is estimated to cost approximately $600 million. To pay for this the senate has come up with a novel idea. It has decided to increase the fees for H1-B and L-1 applicants who want to work in the United States by $2000 (the total cost for such an application including the legal fee would be around $6500 per applicant).
It is debatable whether any nation that has a very long border with another nation can completely seal that border. The US-Mexico border, just like the India-Pakistan and India-China borders, does not make a lot of sense to people who live along the border regions. Fortifying the border and treating it like a war zone is not something that the “leader of the free world” should be doing. But that is another topic.
During tough economic times blaming the immigrant will always be a successful strategy. If Americans do want to get tough on the immigrant (across the border from Mexico or from India or China) then the America that I believe in should be able to clearly articulate the cost of doing so to its citizens. If we cannot pay for it then we have to wait till the economic situation improves (we cannot have a security system installed in our house if we cannot pay the mortgage).
The H1-B program is practically over. Even if an American company wants to hire someone from India or China on H1-B, the State Department in most cases is refusing to grant them visas to travel to the United States. The new fee structure will pretty much also kill the L-1 program (individuals on L-1 visas normally stay in the US for about 3 to 6 months and leave. During this period they are still paid locally in their home countries and get a stipend for expenses during their stay in the US).
Democrat Chuck Schumer and Claire McCaskill are the architects of this bill. Senator Schumer said “All we’re saying is, you’re going to have to pay more for those visas”. I think it is a lot more complicated than that. Businesses rarely absorb increase in costs. It is normally passed on to the American consumer (who stopped caring a long time ago). But the question to the American public is this. Are we going to pay for our own border security by collecting fees from workers from poor countries like India or are we willing to pay it from our own pocket? We will have to pay when these workers stop coming?
In 2007 fifty six million foreign tourists visited the United States (the vast majority of them are from Western Europe and Canada). They spent over $122.7 billion. It is interesting to note that Chuck Schumer and Claire McCaskill decided to tax the 65,000 or so visitors to this country (who are mostly from poorer nations) rather than make small increases to tourist visa fees from the 56 million or so tourists who visit this country from other wealthy nations.
Chuck Schumer’s real intentions were revealed when he said that “The emergency funds will be paid for by assessing fees on foreign companies known as chop shops that outsource good, high-paying American technology jobs to lower wage, temporary immigrant workers from other countries. These are companies, such as Infosys, but it will not affect the high-tech companies, such as Intel or Microsoft, that play by the rules and recruit workers in America“. It is shocking to hear an American senator use words like chop shop to describe competition. This is what recession has done to the American psyche.
There is a message being sent here. America does not fear competition from Western Europe and Canada anymore (citizens from Western Europe and Canada can work in the United States without paying any fees). But India and China although poor worries America. This bill clearly sends a message that foreign workers and companies from India are not welcome. Human capital is not the treasured commodity that it once was. For the first time in a long time there is a fear of competition and a move towards protectionism. We along with our government want to live in a dream and not face realities or make the tough decisions. Is this the beginning of the end of the American empire?
“And the end of the fight is a tombstone white with the name of the late deceased, and the epitaph drear: ”A Fool lies here who tried to hustle the East.” – Rudyard Kipling
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- India Should Not Buy F-16s and F/A-18s from the United States
- United States in an Education Arms Race with India
- United States Installs another “Leader”
- Indian Workers Exploited in Saudi Arabia
Category: News & Government
You’re right. There seems to be a lot of introspection in the US right now – and blaming immigrants is easy. They don’t have a voice, and they’re easy to identify.
The US has also been showing a desire to cut down on “job loss” due to migration of jobs overseas. Of course, this will raise prices for US consumers. But lots of people feel that this is necessary to cut down the dizzying national debt…
Bhagwad,
Suddenly immigration is a hot button issue again. The economy definitely has something to do with it. The statement issued by the senators should be a warning to the Indian community in the US. Most of us blindly vote for the democrats. Maybe it is time to rethink that strategy.