Statement by Rep. Lamar Smith (R-TX).
Hearing: House Subcommittee on Immigrations and Claims.
Re: H1B visas.

Date: August 5, 1999.
Source: House Judiciary Committee.


AUGUST 5, 1999

No one publicly questions whether immigration should serve national interests such as maintaining America's world-leading status in technology fields.

Few question the fact that skilled workers from foreign countries, many of them educated in the U.S., can help us maintain our international technological edge.

There is another side to this public policy equation: The American high-tech workforce is growing rapidly. And we should never pit Americans against foreign workers.

We do know there is a growing demand for temporary skilled worker visas. All else is open to discussion. The American Competitiveness and Workforce Improvement Act of 1998 increased the annual 65,000 quota for foreign professional workers under the H-1B temporary visa program to 115,000 in 1999 and 2000 and 107,500 in 2001. It is rare for Congress to revisit a significant issue such as increasing the overall number of foreign workers admitted to the U.S. less than a year after enacting major legislation. But something funny happened since the Congressional debate last year.

Even after almost doubling the number of H1-b visas, the INS reported that the new cap of 115,000 visas would be reached well before the end of fiscal year 1999. In fact, we reached the cap earlier with 115,000 visas than we did the year before when 65,000 visas were available. One of the purposes of today's hearing is to evaluate why, contrary to expectations, so many H-1B petitions were submitted since the passage of the bill. A related question is whether established users of the H-1B program have increased the number of aliens they petition for, or whether there is a new universe of users.

Some say that the increased demand is caused by an ongoing and worsening shortage of information technology workers and that in fact the high demand for H-1B visas is proof in and of itself of a shortage.

Others respond that there is no such shortage and that the high demand is merely reflective of a preference for foreign workers and their perceived advantages over American workers. I am disappointed that none of five information technology companies asked to provide witnesses for today's hearing was willing to do so, especially since they are so outspoken on the subject.

Another possible reason the cap has been reached could be called the "bubble." After the 65,000 cap was reached on May 11, 1998, the INS kept receiving petitions, and kept approving them with the stipulation that the petitioned-for aliens could not start work until the beginning of the next fiscal year on October 1, 1998. In all, the INS approved 19,431 petition before October 1.

These aliens were counted against the 1999 quota, not the 1998 quota. So an argument can be made that before fiscal year 1999 even started, the 115,000 quota approved by Congress for this year had in effect been reduced to 95,569. Without this reduction, we might have finished the fiscal year without coming up against the cap.

I should point out that there will be another bubble that will develop between now and the end of September, one that might be even larger than last year's.

A last possible reason for the cap being reached is visa fraud. Every H-1B visa that is obtained through fraud means one less for legitimate employers. Unfortunately, fraud seems to be prevalent, as was shown at a hearing held before this Subcommittee on May 5.

William R. Yates, Acting Deputy Associate INS Commissioner for Services, reported that through the first five months of this fiscal year, service-wide presentations of fraud cases for prosecution had "already exceeded mid-year goals."

Nancy Sambaiew, Deputy Assistant Secretary of State for Visa Services, spoke of the vulnerability of the H-1B process to fraud and the need to target anti-fraud efforts "up front before the petition is approved."

This strategy was employed by INS and State when they undertook a review of more than 3,000 pending petitions at the U.S. Consulate at Chennai, India, the city that provides the most IT foreign workers. The results were astounding -- Chennai's anti-fraud unit was able to verify the authenticity of only 45% of the petitions -- 21% were found to be outright fraudulent. On May 26, I wrote to INS Commissioner Doris Meissner and specified steps that she should take to reduce the loss of H-1B numbers to fraud. I have yet to receive a reply.

A point often overlooked in the H-1B debate is that it affects more than high-tech workers. A large share of H-1B visas is used by physical and occupational therapists, and we must consider the impact of any increase on these professions.

I have confidence that today's hearing will provide the Subcommittee with valuable information on the H-1B program. Armed with this information, and more insight into the state of the information technology job market, we can make a judicious decision as to the ultimate question that I would guess is on the mind of many in the audience today, which is whether or not Congress should again raise the annual quota of H-1B visas.

We should remember, though, that H1-b is just the tip of the workforce iceberg. We're talking about approximately 100,000 visas per year, while ignoring the fact that we admit almost one million legal immigrants every year with no regard to skill or education level.

Approximately 35 percent of legal immigrants, who will be our major source of new workers during the next century, lack a high school education. But 90 percent of new jobs will require more than a high school diploma.

We will debate H1-b visas. But we cannot address looming workforce problems if we turn a blind eye to immigration policies that do not serve national interests.