Skip to comments.The H-1B swindle
Posted on 10/29/2005 7:25:40 AM PDT by vrwc0915
It appears there is hard evidence to prove that employers are using the H-1B visa program to hire cheap labor; that is, to pay lower wages than the national average for programming jobs.
According to The Bottom of the Pay Scale: Wages for H-1B Computer Programmers F.Y. 2004, a report by Programmers Guild board member John Miano, non-U.S. citizens working in the United States on an H-1B visa are paid significantly less than their American counterparts. How much less? On average, applications for H-1B workers in computer occupations were for wages $13,000 less than Americans in the same occupation and state.
Miano based his report on OES (Occupational Employment Statistics) data from the Bureau of Labor Statistics which estimates wages for the entire country by state and metropolitan area. The reports H-1B wage data came from the U.S. Department of Labors H-1B disclosure Web site.
Miano went out of his way to be balanced, and whenever possible he gave the benefit of the doubt to the employer. For example, he used OES data from 2003 because this is the wage information that would have been available to the employers when filing an LCA (labor condition application).
Miano had some difficulty matching OES job codes with LCA job titles, which employers typically create. Where both the OES and the LCA listed a job as programmer/analyst, Miano took the conservative approach of assuming that the LCA was describing a programmer, a job title that typically earns a lower wage than a systems analyst.
Nonetheless, Mianos report shows that wages paid to H-1B workers in computer programming occupations had a mean salary of $52,312, while the OES mean was $67,700; a difference of $15,388. The report also lists the OES median salary as $65,003, or $12,691 higher than the H-1B median.
When you look at computer job titles by state, California has one of the biggest differentials between OES salaries and H-1B salaries. The average salary for a programmer in California is $73,960, according to the OES. The average salary paid to an H-1B visa worker for the same job is $53,387; a difference of $20,573.
Here are some other interesting national wage comparisons: The mean salary of an H-1B computer scientist is $78,169, versus $90,146 according to the OES. For an H-1B network analyst, the mean salary is $55,358, versus the OES mean salary of $64,799. And for the title system administrator, there was a $17,478 difference in salary between the H-1B mean and the OES mean.
H-1B visa workers were also concentrated at the bottom end of the wage scale, with the majority of H-1B visa workers in the 10-24 percentile range. That means the largest concentration of H-1B workers make less than [the] highest 75 percent of the U.S. wage earners, the report notes.
While it would be difficult to prove that any one particular employer is hiring foreign workers to pay less, the statistics show us that, for whatever reason, this is exactly what is happening on a nationwide basis. Miano says lobbyists will admit that a small number of companies are abusing the H-1B program, but what he has found in this research is that almost everyone is abusing it.
Abuse is by far more common than legitimate use, he says.
First of all lets put things into perspective. Regardless of ones opinion on the merits of the visa program one can not deny that the visa's are in and of themselves a government intervention. After all if it were not for the government granting the visas and setting the quotas there would be no issue hence no whining. So the government is involved like it or not. Also, one can not deny that visa's change the supply and demand ratio. Hence the government is involved with the supply and demand of some professions in this country. To call it whining is interesting use of the term to me.
Regarding the stock prices I submit to you the real culprit is the mega million dollar salaries of the top executives at 95% of the companies. Paying an engineer 100,00 a year to work 60-70 hours a week is not what the problem is or ever was.
No company was forced to pay a java engineer anything. By your own statement saying it is ridiculous to pay someone what the market bears indicates that you favor government intervention to change the market. If so be honest about it - don't submit it falsely as a "shortage" say what it is. It is a way to lower the salaries of engineers in this country by means of government intervention. In actuality it was this whining to the government by the big corporations that resulted in the visas in the first place.
Yes I am arguing for enforcement. The way it is now there is no enforcement so it is abused. If there was better enforcement of the laws and the program was truly used for shortages I do not think anyone would have a problem with the visa program.
No, by itself it is not. One has to complete the sentence: intervention into what?
Actually, form economic perspective, it is the citizenship that constitutes barrier to mobility of labor. The visa program lowers that barrier.
Now, don't read to much into the preceding statement: it is merely a statement of fact and not of my position on this. The citizenship is a barrier for a reason, and should stay that way in principle; exceptions are handled by programs such as H1-B.
Intervention into the supply and demand ratio and therefore the market conditions surrounding the pay scale of certain professions.
Actually, form economic perspective, it is the citizenship that constitutes barrier to mobility of labor. The visa program lowers that barrier.
Citizenship has never been a barrier to mobility of labor. A company is always free to move it's operations to another country and hire whatever labor is desired. It is absolutely ludicrous to say that a company is forced to stay in this country and be bounded by the existing labor pool. If there is a shortage and the workers exist in another country - I say move your operations out of the US. Why does our government need to change this countries immigration laws to satisfy corporations X's labor issues.
They were paid 150k a year because of market demand, or perceived market demand. Either the dipshits that were paying them didn't understand market economics OR the market dictated their value based on limited supply.
Glad to hear that. But we only have your anonymous word on that.
Would you? Judging by how easily you accuse thousands of people, you probably would.
Ready doubts about the credibility of management which is in fact hiring lower paid replacements somehow means that I would do the same as they? That does not follow.
On the other hand, however, You're the one accusing people who want law enforcement...which you now admit ignorance of the lack thereof....of being "whiners," etc.
I further note that you have still not responded to the issue of national defense. How DO you feel about the security implications of hiring Chinese "brainpower"?
Perhaps you would be further interested to know the following:
Good historical point. Seems like the outsourcing trap has a long and illustrious pedigree. The Romans and the Goths...
The Globalists never square their dreams of world governmental institutions with the facts of history.
Thanks for the ping!
Or one can import ChiCom spies, like the ones just rounded up in LA selling our Aegis navy defense systems.
"H1-B's pay income tax in the U.S"
Do they pay the full tax? Do they pay SS?
You did see this part?
At the most recent IFMA Forecast & Outlook Seminar, Technomic revealed that now, unlike last year, when labor was the issue, the cost of food is the top concern among operators. Seven in 10 operators surveyed said costs are rising significantly. Two-thirds had raised menu prices an average of 4 percent in the last six months, and close to half expected another hike of 3 percent in the next six months. As for manufacturers, Technomic reported that a big part of its sales growth has been a result of price increases. Real sales growth has not been robust. Nearly eight out of 10 manufacturers raised prices to distributors by an average of 6 percent and expect additional increases in the future. In fact, prices have risen so rapidly that some distributors say it is hard to keep up with pricing changes in their systems.
Says who...the politicians invested in understating the problem?
I commend this article for a fair grasp on the situation, at Safehaven.com And no, I'm not a gold bug.
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Citizenship has never been a barrier to mobility of labor. A company is always free to move it's operations to another country and hire whatever labor is desired. It is absolutely ludicrous to say that a company is forced to stay in this country
Movement of a company is movement of capital, not labor.
You also put words in my mouth: I never even addressed whether companies are free to move.
If something in my post is not clear to you, ask instead of assuming a fighting posture and throwing words around, whose meaning you do not understand fully. I am glad to have a discussion but have no interest in contests.
Isn't this what I said? Except for using a derogatory word in reference to market participants. Obviously, you don't know that market participants, in the aggregate, are always smart --- smarter than any other economic institution.
This is patently false to the point of absurd: not only did I not do that but stated that I too want propert enforcement.
Since when responding to every post has become part of my job description?
You may want to cool down a bit.
How DO you feel about the security implications of hiring Chinese "brainpower"?
Actually, form economic perspective, it is the citizenship that constitutes barrier to mobility of labor. The visa program lowers that barrier.
You are technically correct - citizenship is a barrier to mobility of labor. My response was addressing the underlying issue that this barrier raises. In my opinion this is a good barrier. If a corporation does not like the labor pool in this country or the labor pool does not meet it's needs then that company is free to move. Why should our government have to change it's immigration policies to satisfy corporation x's labor barriers. Labor barriers that are self induced due to the lack of desire to move out of the USA.
My comment above is actually wrong. Citizenship is not a barrier to mobility of labor. People in this country are free to move about. So from a perspective of the citizen there is no such barrier and therefore from a perspective of the government there should be no need to change the immigration laws - H-1B included.
This is my opinion as well.
If a corporation does not like the labor pool in this country or the labor pool does not meet it's needs then that company is free to move.
I completely agree with this statement as it is worded.
The problem addressed by H1-B is not this one, however: it deals with a sort of an intermediate situation, where the company prefers to stay in the U.S. but lacks very few individuals. If a company wants to hire a German manager to reside in the U.S. but direct marketing campaigns in Germany and Switzerland, say. The company likes 10,000 American workers in its plants. What is it to do? Certainly not move the entire company to Germany, right? Whom does it benefit if we don't allow that German manager to come and work in the U.S.? Nobody (and actually increases the costs of goods, for which we all pay). The same situation occurs em masse in major universities. Talent is spread around the world, and universities want the best. If the candidate happens to be Italian, why not hire him/her?
Situations such as this is what H1-B is designed for. The German manager and the Italian professor are allowed to work. YOu never hear about the success of this program, however: all you hear is whining from programmers. It is true that some abuses may exist in that sector (and should be dealt with accordingly) but that does not reflect neither on the objective nor success of the program.
No, they are not: they are free to leave but not get jobs oversees. Americans need permits to work in the EU.
Moreover, it's not the mobility of Americans we were discussing, were we? A foreigner (non-citizen) is NOT free to come to this country (even as a tourist in the case of many countries) and work here. The lack of American citizenship is a barrier to his/her entry into our labor force.
So I think your original comment is correct.
Perhaps that is the way it is supposed to work - but in reality that is not how it is being used. If you look at the h-1b database you will find that many companies hire thousands of H-1B workers and often times they layoff the American worker. Many cities and towns have been inundated with foreign workers and our population has grown beyond the infrastructure capacity of most towns. I think your view on what the H-1B program is and how it is being used is not reflective of what is really going on. My point is that our government has no business changing the immigration policies of this country for the benefit of a corporation especially when the laws surrounding it are not enforced or even modestly monitored.
I look at our government as a body that represents the citizens of this country. So because we are talking about a governments program (the H-1B program) I think it is rational to discuss it in terms of the citizens of this country. The lack of American citizenship as it relates to the issue of labor shortages is not a barrier that is of any concern to the American citizen. So why is it that our government should be making laws that have no benefit for the citizens for whom they represent. Since when is our government supposed to be addressing the issues of foreigners?
The "market participants" ie the hiring managers were willing to pay 150k. Either they had a ligitimate use for the skill hired and were willing to pay the current market rate OR they had no idea what the market rate was.
Frankly we should all be proud of any kid, with nothing more than a high school diploma, that can negotiate such a salary. If the hiring manager was snowballed by such an individual then he would in fact be a dipshit.
No. It's the undeniable reasonable interpretation of your previous policy positions. You only belatedly shifted gears when you realized that your position was untenable. You feel badly about importing Chinese "brainpower". You should. They are invariably totally unregenerate foaming-at-the-mouth communist propaganda stooges...evidently fresh out of the PLA: Here's an example of one at the University of Minnesota...How Communist China Entered the Korean War.
Furthermore, there is a growing bipartisan consensus that the industrial economic boosting of China is in fact dangerous to our national security. The connection is undeniable. Note the 2005 Annual Report of the U.S.China Economic and Security Review Commission released yesterday. Here is Roger Robinson's overview in their press release:
Statement of Vice Chairman Roger W. Robinson, Jr.
Release of 2005 Annual Report to Congress of the U.S.-China Economic and Security Review Commission
Press Conference to Announce USCC 2005 Annual Report
November 9, 2005
There is another barrier that is apparently pretty porous. Intellectual property enforcement. How many TRILLIONS of dollars have been lost to the Western economies (particularly the U.S., the primary target of Chinese exports) by the intellectual property scoff-laws of the Communist and Asian countries? It is literally incalculable. One thing is for sure...if the Chinese were paying the patent and copyright royalties they truly owed, there would be a hell of a dent made in the annual trade deficit. And how many times have we been told by the apologists for China that they were adopting the Western protections? That they would become real members of the WTO, and not an over-sized parasitical leech?
Testimony, Jason Berman, RIAA/IFPI, U.S.-China Economic and Security Review Commission
February 4, 2005
Mr. Chairman and Members of the Commission, thank you for the opportunity to appear before you today to discuss the long-standing issue of how to assess China's intellectual property regime and, most importantly, its current enforcement policy, and to explore possible strategies for positively impacting both China's WTO compliance and its bilateral obligations with the United States.
If I had to characterize the last decade in terms of these issues, the first point I would make is that while there has been significant progress in dealing with the production for export, that local enforcement issues have remained relatively constant. There has been some progress, most notably improvement in the legal structure itself, but this has done little to expand the commercial opportunities for US record companies in China . Enforcement remains a serious problem and, as a result, China continues to be a marketplace dominated by pirated recordings despite a sporadic increase in the number of raids undertaken and the hundreds of millions of discs seized. Secondly, there continues to be a number of market access barriers that prevent timely entry for many U.S. and other foreign recordings-again, despite an increase in the number of titles that are officially sanctioned for release.
I will return to my conclusions in greater detail but I want to address directly the questions raised by the Commission's letter of invitation.
What is the overall assessment of compliance with WTO's IPR rules? What, if any, changes have occurred over the past year and what are the prospects for the future?
There has been some improvement, particularly with long-awaited issuance of the new Judicial Interpretations governing criminal actions, but a definite verdict over whether this will have meaningful results will have to await actual implementation-the real litmus test is effective enforcement and it is one China has historically failed to meet.
As you know, the TRIPS Agreement is basically divided into two parts: the substantive standards (e.g. what rules must be in a copyright law) and effective enforcement. For the most part, China is now in compliance with the standards test. However, it is not in compliance on a number of counts in regard to effective enforcement.
For example, the enforcement section of TRIPS sets out a general set of obligations, beginning with the following from Article 41: "members shall ensure that enforcement prodecures…are available under their law so as to permit effective actions against any infringement" covered by this Agreement, including expeditious remedies which constitute a deterrent to further infringements." China's failure, in terms of effective enforcement, centers on its historic and continued reluctance to apply the necessary measures to deter piracy. Simply put, episodic raids and seizures, no matter how successful, will not result in any notable declines in pirate production. Pirates, without facing serious penalties, will simply view raids and seizures as a cost of doing business-and piracy is a very profitable business.
Another and related example, is China's failure to comply with Article 61, which specifically requires criminal penalties "in cases of willful trademark, counterfeiting or copyright piracy on a commercial scale." As I noted earlier, China has enacted the necessary laws-the appropriate remedies are on the books. Yet, with very, very rare exceptions, there have been extremely few prosecutions and convictions for copyright piracy. China has persisted in defining "commercial scale" in such a way as to make it highly unlikely any pirate with common sense will be caught in its net as a punishable criminal offense. Even with the recent Judicial Interpretations, the thresholds for a criminal prosecution are likely to continue to prove difficult to meet. Thresholds may be an appropriate test in determining the level of punishment, but they are inappropriate test in determining whether a criminal offense has been committed.
Moreover, China requires that its criminal code remedies are only available in those instances where the pirate is making a profit. Ironic, isn't it, that the concern is the pirate's profitability and not the fate of the legitimate business. In addition, the profit test is actually more difficult to meet than the commercial scale requirement. For example, someone intentionally posting online a single copy of a copyrighted recording, without authorization, will cause serious economic harm on a commercial scale if that recording is downloaded over and over again. It would not, however, meet the for profit test.
At the April, 2004, meeting of the U.S. -China Joint Commission on Commerce and Trade (JCCT), made several commitments to improve IPR enforcement. What are the concrete results to date?
First and foremost, China committed to significantly reduce the level of piracy. Again, the commitment was to significantly reduce piracy. To date, that has not happened.
While there has been some reduction in the overall level of piracy, it is far from a significant reduction. The legitimate market, while it has improved in the last year, is still under siege. Piracy is down from an astounding 90% to about 85%--progress, yes, but a significant reduction, no.
One important aspect of this is that China committed to revise the judicial interpretation governing application of its criminal code so that criminal prosecutions would occur for copyright piracy. It is true that this promise, at least in theory, has been fulfilled. Whether the thresholds are sufficiently low to prove effective and how they will be implemented in criminal prosecutions is still an open question.
Other JCCT commitments included:
To increase penalties for IPR violations by taking the following actions by the end of the year:
increase the scope of IPR violations subject to criminal investigation and criminal penalties;
apply criminal sanctions to the import, export, storage and distribution of pirate product;
apply criminal sanctions to online piracy;
Some of these were addressed by the recently published "Judicial Interpretations." The Interpretations have a number of useful elements and if China has the political will to apply them conscientiously and strictly, then China might be able to meet these commitments. Given China's history, a healthy dose of skepticism is merited until things actually change. While it is very likely that Vice Premier Wu Yi, who is responsible for IPR and led the Chinese JCCT delegation, is serious about bringing about a reduction in piracy, the police still seem to regard IPR violations as not really a criminal activity that merits their attention in a serious way.
Conduct a major crackdown on pirates to demonstrate China's intentions by mounting a nationwide enforcement campaign to stop the production of pirate Product and punish violators.
It is clear that a one year campaign was launched last September and that this effort has resulted in noticeable increases in the number of raids and product seizures. However, the usual remedies are being applied-product is seized and modest administrative fines are levied. This is not effective enforcement and it will not result in a significant reduction in piracy.
Improve the protection of electronic date by ratifying the WIPO Internet Treaties as quickly as possible. To date, while there have been some promising public announcements about China's intention to ratify the Treaties, there has been no demonstrable progress on this, and this legal issue must be viewed against a background that has witnessed a proliferation of sites offering unauthorized recordings.
Increase customs enforcement actions against imports and exports of pirate products and provide easier remedies for rights holders to secure effective enforcement at the border. Again, there is no indication that is underway.
What should the U.S. be doing to ensure compliance? Has technical assistance been provided? Is there a particular problem area that could be the subject of a WTO dispute case?
Who should the U.S. be cooperating with in terms of trading partners?
To ensure compliance the U.S. Government is conducting a Special 301 "out-of-cycle review" at this time. The results of this review are expected in mid March. Options available to the U.S. include initiating a WTO dispute case; placing China on one of the Special 301 lists (priority foreign country, priority watch list, watch list); impose some form of trade sanction that is consistent with our WTO obligations. These options are not mutually exclusive.
The U.S. and its IPR industries have been providing a considerable amount of technical assistance. The international recording industry, for example, has been conducting extensive training of Chinese judges. The U.S. Government has also been training police, prosecutors, and judges and this is likely to increase in 2005. On a related point, our own ability as an industry to assist in the process of fighting piracy is severely restricted in most provinces in China-in contrast to other countries where our investigative resources are welcomed. It is only very recently, for example, that in some jurisdictions the local enforcement authorities have permitted IFPI anti-piracy personnel to accompany them on raids.
In regard to a possible WTO dispute case, I would refer back to the issue of deterrent penalties-a WTO requirement. Currently, China does not provide deterrent penalties, not because it requires legislative changes to its legal system but because it seems to lack the political will to do so.
We should be reaching out to the European Commission and to Japan, where there seems to have been has recently a renewed interest in fighting piracy. In truth, the U.S. has attempted to involve both in its efforts to seek improvements in China's IPR regime-mostly to no avail when it has become clear that some form of pressure is what it takes to prompt China to respond affirmatively. However, I would not abandon the effort, particularly in regard to any potential WTO actions. Both the EU and Japan were invited to and participated in this year's Roundtable in Beijing. It is interesting to note that the EU representative pointed out that 67% of the counterfeit good stopped at the borders were from China.
In December, at the EU-China Summit, a Customs Cooperation agreement was signed and it also appears as if copyright enforcement was raised by the EU as an issue to be addressed. In January of this year, the EU and Japan held a joint meeting on The Information Society and, again, IPR and its enforcement was a major issue in regard to China.
Market Access Restrictions
Before I close, there is a very important related topic that I would like to address. This is China's refusal to permit U.S. record companies to participate fully in the Chinese economy. This is what we call denial of "market access."
U.S. record companies' possess great expertise the world over in developing and recording new artists, and distributing, promoting, and advertising their recordings so that the public is aware of them. U.S. record companies must be permitted to undertake the full range of the services they are skilled at providing. Today China severely limits the ability of American record companies to engage in developing, recording and distributing the music of Chinese performers, and in fully participating in developing the Chinese marketplace..
This is done in a number of ways:
(1) Chinese government censors are required to review the content of foreign-produced sound recordings before their release, but domestically-produced Chinese sound recordings are NOT censored. Of course, pirated product is not censored either. China should terminate this discriminatory process between imported and domestically-produced product.
(2) Censorship offices are understaffed, causing long delays in approving new recordings. In recent months, we have seen some improvement and a new recording takes an average of two weeks to be approved which still gives the pirates a crucial headstart. The best result would be for censorship to be industry-administered, as in other countries. If this is not possible, steps must be taken to expedite the process so that legitimate music can be promptly marketed, preventing pirates from getting there first.
Producing and publishing sound recordings in China:
U.S. record companies are skilled at and desirous of developing, creating, producing, distributing and promoting sound recordings by Chinese artists, for the Chinese market and for export from China. However, onerous Chinese restrictions prevent this from occurring. For example, for a sound recording to be brought to market, it must be released through an approved "publishing" company. Currently only state-owned firms are approved to publish sound recordings. China should end this discrimination and approve foreign-owned record publishing companies.
Further, production companies (even wholly-owned Chinese ones) may not engage in replicating, distributing or retailing sound recordings. This needlessly cripples the process of producing and marketing legitimate product in an integrated manner. China should permit the integrated publishing, production and marketing of sound recordings and allow such companies to have foreign investors.
U.S. record companies may market non-Chinese sound recordings only by (1) licensing a Chinese company to produce the recordings in China or (2) importing finished sound recording carriers (CDs) through the China National Publications Import and Export Control (CNPIEC). China should permit U.S. companies to produce, publish and market their own recordings in China and to import directly finished products.
Distributing sound recordings:
Foreign sound recording companies may own no more than 49% of a joint venture with a Chinese company. However, the recently concluded "Closer Economic Partnership Agreement (CEPA) between China and Hong Kong permits Hong Kong companies to own up to 70% of joint ventures with Chinese companies engaged in distributing audiovisual products. China should grant at least MFN status to U.S. record producers per the terms of the CEPA.
You got a link for that report? I want to post it in a few places where key decisionmakers will see it.
Let's just refute a small point from your gold bug source.
BUT, you also know that as of year end 2004, the actual homeownership rate in the US stood at a record 69.2%. In other words, just less than 31% of the US population was actually renting as opposed to owning residential property. So, when the CPI calculation is being made, 23.4% of the entire CPI number is picking up the "housing cost inflation" experience of only 31% of the total US population. The housing cost inflation experience of the other 69% is largely being ignored. C'mon, does this make sense?
The BLS definition: The Consumer Price Index (CPI) is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.
How is the CPI market basket determined?
The CPI market basket is developed from detailed expenditure information provided by families and individuals on what they actually bought.
So, seeing as 69.2% is the American homeownership rate, 69.2% of American household are not directly impacted by a rise in the value of their home. The value could double overnight but mortgage payments would not change. Because this 69.2% of the population has already bought an increase in price does not impact them. Only new, first time buyers or buyers of new construction are impacted by these price increases.
So, what % of the population buys a house for the first time each year? 0.5%? 1.0%? So, does it make more sense to calculate CPI based on the 31% of the population who rents or on the 1.0% (maybe) who buys for the first time?
Thanks for the ping!
My stance has not changed since I last posted that which is linked to above. I still think that you are imbalanced - and not just philosophically. If this bothers you then perhaps you can go whine to the moderator again.
Whine yourself. You can't stand debate. Pickled in your own bile.
Same argument can be made for food, Todd. You bought food last month, hence you don't need anymore the rest of the year....right?
Not even close. How many houses did you buy this year? How many trips to the grocery store did you make?
Coming right up.
The general web site is at www.uscc.gov
Your frequency rate is not going to impact the argument. Everyone within a market, active, or inactive, is conscious of price pressures.
It's not frequency but % of needs purchased. If you bought 100% of your housing (or food) needs 10 years ago, increased prices in the last 10 years won't impact you. Are you saying you buy groceries at the same frequency as you buy houses?
Everyone within a market, active, or inactive, is conscious of price pressures.
Please explain how this impacts CPI. Less than 3000 words if you can. Thanks.
Numerous ways it affects inflation (which is no longer measured by the CPI anyways) and is manifested. From hoarding "investing" to "bubble" psychology.
Any rate, getting back to your argument on frequency or as you try to frame it, %, you make a hypothetical claim of what, 1% transition among "first time" home buyers...as if they are the only ones? You have to square your number then with even the lame CPI assumption which does seem to weight the housing sector vastly higher as a component of the cost of living.
You're confused again. You said:
"Everyone within a market, active, or inactive, is conscious of price pressures"
How is an "inactive" market participant hurt by a rise in the price of the good he is "inactive" in?
Any rate, getting back to your argument on frequency or as you try to frame it, %, you make a hypothetical claim of what, 1% transition among "first time" home buyers...as if they are the only ones?
Please explain how non first-time/ new construction buyers are impacted by higher housing prices. Explain how my argument is less accurate than your data dump.
You have to square your number then with even the lame CPI assumption which does seem to weight the housing sector vastly higher as a component of the cost of living.
Vastly higher than what?
The lack of American citizenship as it relates to the issue of labor shortages is not a barrier that is of any concern to the American citizen. So why is it that our government should be... Regarding: making laws that have no benefit for the citizens for whom they represent. Since when is our government supposed to be addressing the issues of foreigners?
As I mentioned earlier, benefits from employing the best talent are accruing to the citizens of THIS country. The best foreign-born minds that serve on faculties of OUR universities educates and mentor thousand of OUR youth --- each of them, that is. The atomic bomb that allowed us to save hundreds of thousands of American lives and subsequently defended us against Russia was built almost entirely by foreigners. It was also a foreigner, Albert Einstein, that convinces the president to build it. I can give a myriad of examples.
The problem is, you know those examples, too, but chose to disregard them entirely in your evaluation of the program. In any of your posts or thoughts, have you ever even acknowledged the all this talent you see in the classrooms, on TV, on the R&D departments of corporations, musicians, all those Canadian comedians and actors --- all these people that bring us countless benefits work here because they receive a permit (a visa, H1-B or another) to do so?
Since the presence of such benefits is incontrovertible and you not only do not give them proper weight but discard them entirely, your evaluation of the H1-B program is faulty. And you are not alone: I have never seen a discussion on FR that would not concentrate entirely on the negatives and abuses. Upon comparison of benefits and costs one can come up with an opinion, but to omit benefits entirely is simply wrong. That's all I tried to point out originally. Questions what should cannot be answered before one learns what is.
I guess, there is a simple misunderstanding here. I was not talking about one of two kids making obnoxiously high salaries --- I was talking about average salaries (classified by experience level) in the industry.
It was the market demand and limited supply that drove salaries that high.
Who was paying those salaries? It's a mistake to think (as socialist always do) that it was corporations. Corporations are merely pipelines: it was consumers (all of Americans) and shareholders (more than one half of all Americans) that paid that extra salary. Has a single sole complained that it is unfair for a 20-year-old kid who cannot even read well be paid $150,000 by some retiree and consumers? Nobody even mentioned that. Neither did I: I don't know any forces that work better than the market; I programmers get high salaries --- well then, it's unavoidable; let them have a party. But now the market forces have taken care of the shortage: the supply is up, the salaries are down. Now those people are whining.
I hope it's clear now that I was not talking about some kid that lives on my block.
But you simply cannot argue with conspiracy-theorist: it's much easier to assume a conspiracy --- the government, in cahout with tens of thousand of economists around the world, is falsifying the inflation data --- than to study the issue. I guess playing a detective in uncovering that evil conspiracy gives to Paul Ross the meaning of life. He will not listen to the facts, even when you present them so well.
I realize that. The gold bug post of Paul's that I responded to claimed they weren't included properly because CPI uses "owner equivalent rent" rather than housing prices, I guess, and that therefore CPI was vastly understated. My point was that a 10% rise in housing prices can't be said to be equal to a 10% jump in CPI (or 42% of 10%) because most people who own homes have owned them for a while.
I guess playing a detective in uncovering that evil conspiracy gives to Paul Ross the meaning of life. He will not listen to the facts, even when you present them so well.
Paul is tame compared to most of the tin foilers. His problems are his data dumps, 30 pages of trash we're supposed to slog thru, and his use of big words he obviously doesn't understand which add nothing to the discussion.
Thanks, I understand better now what you were trying to do.
P.S. Sorry I screwed up the terminology when referring to owner-equivalent rent (my memory did not serve me well, obviously).
And that point fails. First, you disregard the impacts on those actively buying houses...as if there is nothing to see there. Then you ignore the fact that at some point, everyone needs to change housing. Adding on rooms. Fixing things (windows, roofs, siding, sidewalks, driveways, garage floors, heating and A/C plants, flooring) Moving. Etc. And if the production cost has gone through the roof, well, that is only the problem of those people buying houses. But the impact of a "bubble" is far beyond that narrow segment. So again, your logic is flawed right at the conceptual level. And you have shown no actual competing data. Remember, the truism that no man is an island? Your febrile attempt to say the opposite is Wrong.
And how is it that your own data dumps are not totally irrelevant...particularly since they lack relevant or pertinent data? Mine are at least relevant, hence you merely attempt to disparage them...and never do actually or honestly "slog through them." Biassed to the end, Todd. Your nit-picking never has won a single issue.
And BTW, vis-a-vis language: You alone are responsible for your own personal insecurity with an impoverished and anemic vocabulary.
So you claim a 10% rise in housing prices translates into what % jump in CPI?
First, you disregard the impacts on those actively buying houses...as if there is nothing to see there.
What % are actively buying houses? What is the impact on them?
Then you ignore the fact that at some point, everyone needs to change housing.
If I don't change houses for 10 years, housing inflation does not impact me until 2015.
Adding on rooms. Fixing things (windows, roofs, siding, sidewalks, driveways, garage floors, heating and A/C plants, flooring) Moving. Etc.
My point about housing said nothing about repairs. Obviously if repairs are more expensive that impacts CPI.
And if the production cost has gone through the roof, well, that is only the problem of those people buying new houses
That's what I said.
And you have shown no actual competing data.
Look to your own data dump. In post #212, the BLS numbers are superior to the goldbug numbers. Does BLS count as competing data?
And how is it that your own data dumps are not totally irrelevant.
I don't think I've ever dumped more than a page in any post. You regularly dump pages and pages with no indication of what you think the relevant portion might be. Formatting is your friend.
Your misunderstanding of money supply was far from a nit, BTW. How's that dollar debauchment working for you lately?
Actually, it is happening as you type. Bought any houses lately?
Anyways, keeping in mind that many Euro countries are manipulating their currency downward is a frantic effort to prop up their jobs as well, while the U.S. pushes the other way at times. Hence, you need to look to other measures that have been less subjected to governmental manipulation ( U.S. interest rates, for example ) to gain a better sense of the relative vectors of change over time.
As you know from previous discussion, I am a gold skeptic, rather than a gold bug, as it declined from the high of like $830 an ounce in a speculative burst in 1980. But the last five years have been pretty telling.
Okay, now all commodity prices can be subject to individual variables such as supply, like foreign disruptions in mining, or demand, speculative bubbles. Etc. But check out the ongoing inflation in the value of U.S. farmland Todd...this despite the anemia of US agricultural farm income
Or of Dollar Decline against more stable currencies.
Canada's for example:
Spin, Todd, Spin.