Paul Craig Roberts

Jobs Offshoring and Work Visas Are Means of Enriching Corporate Executives with “Performance bonuses” for Replacing American Labor with Lower Paid Foreign Labor, thus Reducing Aggregate Demand in the US

From The Failure of Laissez Faire Capitalism and Economic Dissolution the West (Clarity Press, 2013)

“The U.S. Chamber of Commerce and immigration advocates, such as the American Immigration Lawyers Association, immediately went to work to defeat or to water down the amendment. Senator Grassley’s attempt to prevent American corporations from replacing American workers with foreigners on H-1B work visas in the midst of the most serious economic crisis since the Great Depression was met with outrage from the U.S. Chamber of Commerce, a business lobby determined to protect the multi-million dollar bonuses paid to American CEOs for reducing labor costs by replacing their American employees with foreign employees.”

“On January 23, 2009, Senator Grassley wrote to Microsoft CEO Steve Ballmer:

“I am concerned that Microsoft will be retaining foreign guest workers rather than similarly qualified American employees when it implements its layoff plan. As you know, I want to make sure employers recruit qualified American workers first before hiring foreign guest workers. For example, I cosponsored legislation to overhaul the H-1B and L-1 visa programs to give priority to American workers and to crack down on unscrupulous employers who deprive qualified Americans of high-skilled jobs. Fraud and abuse is rampant in these programs, and we need more transparency to protect the integrity of our immigration system.

“Last year, Microsoft was here on Capitol Hill advocating for more H-1B visas. The purpose of the H-1B visa program is to assist companies in their employment needs where there is not a sufficient American workforce to meet their technology expertise requirements. However, H-1B and other work visa programs were never intended to replace qualified American workers. Certainly, these work visa programs were never intended to allow a company to retain foreign guest workers rather than similarly qualified American workers, when that company cuts jobs during an economic downturn.

“It is imperative that in implementing its layoff plan, Microsoft ensures that American workers have priority in keeping their jobs over foreign workers on visa programs.

“My point is that during a layoff, companies should not be retaining H-1B or other work visa program employees over qualified American workers. Our immigration policy is not intended to harm the American workforce. I encourage Microsoft to ensure that Americans are given priority in job retention. Microsoft has a moral obligation to protect these American workers by putting them first during these difficult economic times.”

In the Senate John McCain was the spokesman for the corporate interests who put their performance bonuses ahead of the economic welfare of the American work force. McCain declared Senator Grassley’s effort to protect American workers to be “protectionism” and harmful to America. McCain said that protecting American jobs would cause a second Great Depression. The only depression it would cause would be in the performance bonuses of corporate executives. The protection of American incomes would actually boost aggregate demand and GDP.

US Chamber of Commerce Thomas Donohue said it was “economic patriotism” to put foreigners first. President Obama appointed corporate apologists for moving American jobs offshore to his National Economic Council. The American work force has a long history of being put last.

Microsoft and the rest of the unpatriotic American corporate world ignored Senator Grassley and put their bonuses ahead of the welfare of the American work force. Americans with mortgage payments, car payments, kids in school, were pushed into unemployment so that corporate executives and boards could claim performance bonuses–the largest component of their pay–for laying off Americans and replacing then with lower cost foreigners on work visas, thus lowering labor costs and raising profits. They did the same thing by offshoring their manufacturing. These unAmerican practice continues today. Indeed, the work visas have been endorsed by Elon Musk and President Trump.

I can remember when conservatives and libertarians saw the conflict as government vs. business and lined up with business against a government associated in their minds with dystopian novels of tyranny. They did not understand that government was something that the corporations used to advance their interests.

The notion has been successfully lobbied into the minds of the members of the House and Senate that the United States is incapable of producing enough trained people to staff US industry. I think that this is a disinformation success that even exceeds the Israel Lobby’s success.

The United States has about 6,000 universities and colleges, of which about 4,000 are degree-granting institutions. Does anyone really believe that the United States cannot produce an educated work force?

Does anyone really believe that Harvard, Princeton, Yale, Columbia, Cornell, University of Pennsylvania, Stanford, University of California, MIT, Georgia Tech, Cal Tech and the other giants of education cannot produce the engineers and scientists that the American economy needs?

The notion that the United States, still acknowledged worldwide as the premier nation despite its decline, is incapable of producing a work force sufficient for its economy and must rely on India, China, and other countries is absurd. Yet this absurd notion was instilled in the members of the US Congress, in the presstitute media, in Elon Musk and President Trump.

What are we going to do about this?

In 2013 I published a book, The Failure of Laissez Faire Capitalism and Economic Dissolution of the West. The book was published in translation in a number of foreign countries in addition to the US.

In the US nothing has been done about this problem. Indeed, Musk and Trump see as a virtue what is undermining the US economy.

For years the booming stock market and growth in billionaires has rested on profits from corporations cutting labor costs, which means laying off American workers. Americans are replaced by foreigners on H-1b and L-1 work visas and by having their jobs outsourced to Asia and Mexico. They are replaced by robotics and AI. So where does the consumer income come from to drive the economy? It comes from rising indebtedness. Many Americans live on their credit card, paying the minimum due, thus building their debt.

We are left with the picture that the American economy is based on consumer debt, and not on any real economic foundation.

Stock prices are based on Federal Reserve money creation and on artificial profits from replacing US labor with cheaper foreign labor. Is the American economy a house of cards surviving on the dollar’s role as reserve currency?

A reader whose career was stolen from him by foreign labor asks if Americans get reparations for the discrimination they have suffered by being excluded from the US job market: https://www.paulcraigroberts.org/2025/02/21/reparations-for-white-males-for-50-years-of-discrimination/

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Jobs Offshoring and Work Visas Are Means of Enriching Corporate Executives with “Performance bonuses”
https://www.paulcraigroberts.org/2025/02/21/jobs-offshoring-and-work-visas-are-means-of-enriching-corporate-executives-with-performance-bonuses/