Even brief and temporary curbs on the use of imported contract workers may cause discrimination against “our personnel based on country of birth,” according to a letter sent by Fortune 500 lobbyists to President Donald Trump.
The letter was sent to warn Trump as he pushes forward with plans announced on April 22 to review the various visa programs. The programs provide a growing army of foreign contract workers to Fortune 500 firms, despite the coronavirus crash that is causing mass unemployment among swing-voting U.S. graduates.
The
letter , signed by Google, Facebook, Microsoft, and many other companies, says:
We urge you to avoid outcomes, even for temporary periods, that restrict employment-authorization terms, conditions, or processing of L-1, H-1B, F-1, or H-4 [visa worker] nonimmigrants. Constraints on our human capital are likely to result in unintended consequences and may cause substantial economic uncertainty if we have to recalibrate our personnel based on country of birth.
Immigration reformers scoffed at the lobbyists’ hand-wringing.
“The ‘unintended consequences’ these cheap labor advocates fear if guest worker visas are curtailed are having to hire American workers at livable wages,” said Rosemary Jenks, government relations chief at NumbersUSA. Her group favors a national policy of lower immigration and higher wages
Livable wages are “a consequence we should not only support but demand,” she added.
“Every piece of data the government collects …. [show] there are massive numbers of native-born Americans and legal immigrants already here not working,” said Steven Camarota, research director at the Center for Immigration Studies.
“Those out of work are of every type, from high school dropouts to the most educated. President Trump has an obligation to do everything he can to help out of work Americans get jobs, including significantly reducing the flow of foreign workers into the country,” he said.
Trump’s April 22 announcement is giving Trump another opportunity to fulfill his March 2016
campaign trail promise: “I will end forever the use of the H-1B as a cheap labor program, and institute an absolute requirement to hire American workers first for every visa and immigration program. No exceptions.”
That promise helped Trump win many votes from swing-voting graduates. But Trump and his deputies have ignored that 2016 promise since his Inauguration day promise of “Hire American.”
This failure to curb the huge white-collar labor inflow came as Trump successfully stopped the flood of blue-collar migrants coming over the southern border, despite furious and emotional opposition from allied Democrats, progressives, and business groups. Trump’s border policies successfully pushed up blue-collar salaries, but white-collar salaries stalled as companies imported more foreign contract workers.
The May 21 response from the Fortune 500 companies includes
an appendix that lists a series of economic studies to justify their reliance on imported labor. But most of the studies were conducted before China’s Wuhan virus crashed the U.S. economy and threw millions of swing voting U.S. graduates into the unemployment lines.
Fortune 500 companies use many visa programs to keep an army of roughly 1.3 million white-collar foreign employees in a wide variety of U.S. jobs, including many starter jobs in third-tier subcontractors. These foreign employees accept lower wages and tough conditions in hope of winning the deferred bonus of green cards and citizenship for themselves and their descendants.
Roughly 750,000 foreigners — mostly Indians — are imported via the white-collar H-1B program. Another army of up to 500,000 foreign graduates is imported via U.S. universities under the Optional Practical Training and Curricular Practical Training programs. The J-1, L-1, TN, and H4EAD programs add hundreds of thousands of additional foreign employees.
Also, a growing number of foreign graduates are smuggled into U.S. office parks via fraud in the B-1, OPT, and H-1B programs, but few violators are penalized. “It happens all the time,” said Virkan from Texas, a former H-1B who described how major U.S. companies ignore large-scale fraud in the visa worker subcontracting process. The fraud diverts salaries slated for H-1B and OPT workers to the Indian owners of interlocking subcontracting firms, many of whom are based in Texas, he said. The money is hidden from investigators by passing it through families in India, said Vikram, who is now a citizen.
Amid the inflow, American graduates are increasingly being sidelined as U.S. executives hire and fire blocs of subcontracted visa workers, usually without complaint from the foreign worker or even notice by progressive reporters.
The visa workers are edging out Americans as they fill up starter jobs, mid-career jobs, and increasingly, in executive jobs — despite the growing list of corporate failures caused by the U.S. executives’ preference for outsourcing their workforces.
The imported contract workers also allow coastal investors and companies to ignore the growing number of trained U.S. graduates in lower-wage heartland states.
This gradual replacement of the U.S. professional class is masked behind a maze of complex contracts and by agency curbs on information — although U.S. graduates are increasingly mobilizing to protect their economic interests — and that of their children.
US unemployment claims approach 40 million
since March
22 May 2020
The United States Department of Labor reported on Thursday that
more than 2.4 million Americans applied for unemployment insurance last week,
bringing the total number of new claims to 38.6 million since mid-March, when
social distancing measures and statewide stay-at-home orders were first
implemented in an effort to slow the spread of the coronavirus.
Even with the push by the Trump administration since then to
reopen the economy and the easing of lockdown orders in all 50 states—despite a
continued rise in COVID-19 infections and deaths—the US marked its ninth
straight week in which more than 2 million workers filed for unemployment.
While this is down from the peak at the end of March when 6.8 million applied
for unemployment insurance, it still dwarfs the worst weeks of the Great
Recession in 2008.
It is expected that the official unemployment rate for May,
which is to be reported by the federal government in the first week of June,
will approach 20 percent, up from 14.7 percent last month. This is a
significant undercount, with millions of unemployed immigrants unable to apply
for benefits, and many other workers who are not currently looking for work and
therefore are not counted as unemployed.
A man looks at signs of a closed store due to
COVID-19 in Niles, Ill., Thursday, May 21, 2020. (AP Photo/Nam Y. Huh)
Fortune magazine estimates
that real unemployment has already hit 22.5 percent, which is nearing the peak
of unemployment reached during the Great Depression in 1933, when the rate rose
above 25 percent. Millions more are expected to apply in the coming weeks,
pushing the numbers beyond those seen during the country’s worst economic
crisis.
But even these figures do not capture the extent of the crisis
now unfolding across the country. Millions have been blocked for weeks from
applying for unemployment compensation because of antiquated computer systems,
and a significant share of those who have applied have been denied any
payments. On top of this there are significant delays in processing applications
in multiple states, including Indiana, Missouri, Wyoming and Hawaii. Meanwhile,
Florida, which has some of the most stringent restrictions, has refused to
extend its paltry three-month limit on payments for the few who manage to
qualify.
Sparked by the pandemic, the greatest economic crisis since the
1930s is already having a devastating impact on the millions who have seen
their jobs suddenly disappear, while millions more will see wages, benefits and
hours dramatically curtailed whenever they are able to return to work.
Optimistic projections that the US economy would quickly bounce back once
stay-at-home orders were lifted are now becoming much gloomier.
A University of Chicago analysis from
earlier this month projects that 42 percent of lost jobs will be permanently
eliminated. At the current record number, this will mean a destruction of 16.2
million jobs, nearly double the number of jobs which were lost during the Great
Recession just over a decade ago.
“I hate to say it, but this is going to take longer and look
grimmer than we thought,” Nicholas Bloom, a Stanford University economist and
one of the co-authors of the study, told the New York Times .
A survey by the Census Bureau carried out at the end of April
and beginning of this month found that 47 percent of adults had lost employment
since March 13 or had someone in their household do so, and 39 percent expected
that they or someone else in the home would lose their job in the next month.
Nearly 11 percent reported that they had not paid their rent or mortgage on
time and more than 21 percent had slight or no confidence that they would do so
next month.
With millions missing their rent or mortgage payments, tens of
thousands of families will be thrown out on the street in the coming weeks and
months, leading to a dramatic rise in homelessness even as the coronavirus
continues to spread. While many states took steps in March to place a
moratorium on evictions, and eviction notices were unable to be filed due to
court closures, those measures are now expiring and courts are reopening.
The Oklahoma County Sheriff announced Tuesday via their Twitter
page that the department would resume enforcing evictions on May 26. Nearly 300
eviction cases were filed in Oklahoma City between Monday and Tuesday. This
process is being repeated in cities and counties across the country. Evictions
are also set to resume in Texas next week, where many families were ineligible
for aid due to the undocumented status of one or another parent. The CARES Act
provision, which blocks evictions from properties with federally subsidized
mortgages, expires on July 25; in Texas this only accounts for one-third of
homes.
Meanwhile, another wave of layoffs and furloughs is expected by
the Congressional Budget Office at the end of June, when the
multi-billion-dollar Payment Protection Program (PPP) expires. Sold as a
bailout which would help small businesses keep workers on their payroll in the course
of necessary shutdowns, the PPP was in fact a boondoggle for large
corporations, their subsidiaries and those with connections to the Trump
administration. Many small business owners have not seen any aid, and many do
not qualify for loan forgiveness.
Amid historic levels of social misery in the working class,
times have never been better for those at the heights of society, with
America’s billionaires adding $434 billion to their total net worth since state
lockdowns began. Financial markets have soared, underwritten by $80 billion per
day from the Federal Reserve.
Amazon CEO Jeff Bezos, who is rescinding a $2-an-hour hazard pay
increase for his warehouse workers at the end of the month, led the pack,
increasing his personal wealth by $34.6 billion since the onset of the
pandemic. Facebook CEO Mark Zuckerberg was close behind, adding $25 billion to
his fortune. Tesla CEO Elon Musk, who reopened his California auto plant in
defiance of state regulators and with the support of President Trump, saw a 48 percent
increase in his wealth to $36 billion in just eight weeks as the stock market
rebounded from its collapse. All told, the nation’s 620 billionaires now
control $3.382 trillion, a 15 percent increase in two months.
US unemployment
claims approach 40 million since March
22 May 2020
The United States Department of Labor reported on Thursday that
more than 2.4 million Americans applied for unemployment insurance last week,
bringing the total number of new claims to 38.6 million since mid-March, when social
distancing measures and statewide stay-at-home orders were first implemented in
an effort to slow the spread of the coronavirus.
Even with the push by the Trump administration since then to
reopen the economy and the easing of lockdown orders in all 50 states—despite a
continued rise in COVID-19 infections and deaths—the US marked its ninth
straight week in which more than 2 million workers filed for unemployment.
While this is down from the peak at the end of March when 6.8 million applied
for unemployment insurance, it still dwarfs the worst weeks of the Great
Recession in 2008.
It is expected that the official unemployment rate for May,
which is to be reported by the federal government in the first week of June,
will approach 20 percent, up from 14.7 percent last month. This is a
significant undercount, with millions of unemployed immigrants unable to apply
for benefits, and many other workers who are not currently looking for work and
therefore are not counted as unemployed.
A man looks at signs of a closed store due to
COVID-19 in Niles, Ill., Thursday, May 21, 2020. (AP Photo/Nam Y. Huh)
Fortune magazine estimates
that real unemployment has already hit 22.5 percent, which is nearing the peak
of unemployment reached during the Great Depression in 1933, when the rate rose
above 25 percent. Millions more are expected to apply in the coming weeks,
pushing the numbers beyond those seen during the country’s worst economic
crisis.
But even these figures do not capture the extent of the crisis
now unfolding across the country. Millions have been blocked for weeks from
applying for unemployment compensation because of antiquated computer systems,
and a significant share of those who have applied have been denied any
payments. On top of this there are significant delays in processing
applications in multiple states, including Indiana, Missouri, Wyoming and
Hawaii. Meanwhile, Florida, which has some of the most stringent restrictions,
has refused to extend its paltry three-month limit on payments for the few who
manage to qualify.
Sparked by the pandemic, the greatest economic crisis since the
1930s is already having a devastating impact on the millions who have seen
their jobs suddenly disappear, while millions more will see wages, benefits and
hours dramatically curtailed whenever they are able to return to work.
Optimistic projections that the US economy would quickly bounce back once
stay-at-home orders were lifted are now becoming much gloomier.
A University of Chicago analysis from
earlier this month projects that 42 percent of lost jobs will be permanently
eliminated. At the current record number, this will mean a destruction of 16.2
million jobs, nearly double the number of jobs which were lost during the Great
Recession just over a decade ago.
“I hate to say it, but this is going to take longer and look
grimmer than we thought,” Nicholas Bloom, a Stanford University economist and
one of the co-authors of the study, told the New York Times .
A survey by the Census Bureau carried out at the end of April
and beginning of this month found that 47 percent of adults had lost employment
since March 13 or had someone in their household do so, and 39 percent expected
that they or someone else in the home would lose their job in the next month.
Nearly 11 percent reported that they had not paid their rent or mortgage on
time and more than 21 percent had slight or no confidence that they would do so
next month.
With millions missing their rent or mortgage payments, tens of
thousands of families will be thrown out on the street in the coming weeks and
months, leading to a dramatic rise in homelessness even as the coronavirus
continues to spread. While many states took steps in March to place a
moratorium on evictions, and eviction notices were unable to be filed due to
court closures, those measures are now expiring and courts are reopening.
The Oklahoma County Sheriff announced Tuesday via their Twitter
page that the department would resume enforcing evictions on May 26. Nearly 300
eviction cases were filed in Oklahoma City between Monday and Tuesday. This
process is being repeated in cities and counties across the country. Evictions
are also set to resume in Texas next week, where many families were ineligible
for aid due to the undocumented status of one or another parent. The CARES Act
provision, which blocks evictions from properties with federally subsidized
mortgages, expires on July 25; in Texas this only accounts for one-third of
homes.
Meanwhile, another wave of layoffs and furloughs is expected by
the Congressional Budget Office at the end of June, when the
multi-billion-dollar Payment Protection Program (PPP) expires. Sold as a
bailout which would help small businesses keep workers on their payroll in the
course of necessary shutdowns, the PPP was in fact a boondoggle for large
corporations, their subsidiaries and those with connections to the Trump
administration. Many small business owners have not seen any aid, and many do
not qualify for loan forgiveness.
Amid historic levels of social misery in the working class,
times have never been better for those at the heights of society, with
America’s billionaires adding $434 billion to their total net worth since state
lockdowns began. Financial markets have soared, underwritten by $80 billion per
day from the Federal Reserve.
Amazon CEO Jeff Bezos, who is rescinding a $2-an-hour hazard pay
increase for his warehouse workers at the end of the month, led the pack,
increasing his personal wealth by $34.6 billion since the onset of the
pandemic. Facebook CEO Mark Zuckerberg was close behind, adding $25 billion to
his fortune. Tesla CEO Elon Musk, who reopened his California auto plant in
defiance of state regulators and with the support of President Trump, saw a 48
percent increase in his wealth to $36 billion in just eight weeks as the stock
market rebounded from its collapse. All told, the nation’s 620 billionaires now
control $3.382 trillion, a 15 percent increase in two months.
Further details emerge on the extent of the mid-March financial crisis
By Nick
Beams
22 May 2020
An article in the Wall Street Journal (WSJ)
earlier this week provided further details on how close financial markets came
to a meltdown in the middle of March.
Entitled
“The Day Coronavirus Nearly Broke the Financial Markets,” the article recorded
how markets in financial assets, usually regarded as being almost as good as
cash, froze when “there were almost no buyers.”
“The
financial system has endured numerous credit crunches and market crashes, and
the memories of 1987 and 2008 crises set a high bar for marker dysfunction. But
long-time investors … say mid-March of this year was far more severe in a short
period. Moreover, the stresses to the financial system were broader than many
had seen,” it said.
Traders work on the floor of the New York
Stock Exchange. (AP Photo/Richard Drew)
In
testimony and interviews, US Federal Reserve chair Jerome Powell has been at
pains to emphasise that regulatory mechanisms and policies introduced after the
2008 crisis have strengthened the financial system.
In his
interview on the CBS “60 Minutes” program last Sunday, for instance, Powell
downplayed the threat of unemployment reaching levels not seen since the Great
Depression. In the 1930s, he said, the financial system had “really failed,”
but that today “our financial system is strong [and] has been able to withstand
this. And we spent ten years strengthening it after the last crisis. So that’s
a big difference.”
In his interview
on the CBS “60 Minutes” program last Sunday, for example, when asked about the
prospect of US unemployment rising to levels not seen since the Great
Depression, Powell stated that at that time the financial system “really
failed.”
He
claimed that in contrast to the 1930s, “Here, our financial system is strong
[and] has been able to withstand this. And we spent ten years strengthening it
after the last crisis. So that’s a big difference.”
In fact,
Powell’s reassurances are contradicted by the Fed’s own Financial Stability
Report issued last Friday. Focusing on the mid-March crisis, it noted: “While
the financial regulatory reforms adopted have substantially increased the
resilience of the financial sector, the financial system nonetheless amplified the
shock, and financial sector vulnerabilities are likely to be significant in the
near term.”
The
events in mid-March revealed what has actually taken place. While the Fed has
taken limited measures to try to curb some of the riskier activities of the banks
that sparked the 2008 crash, the dangers have simply been shifted to other
areas of the financial system.
The
speculation of the banks may have been curtailed somewhat, but it is now being
carried out by hedge funds and other financial operators. They are financed
with ultra-cheap money provided by the Fed through its low-interest rate regime
and market operations, such as quantitative easing and, more recently, its
massive interventions into the overnight repo market.
The WSJ
report, based on interviews with Wall Street operatives, provided some insights
into how the financial system “amplified” the shock of the pandemic.
Ronald
O’Hanley, CEO of the investor services and banking holding company State
Street, recounted the situation that confronted him on the morning of Monday,
March 16. On Sunday evening, before markets opened, the Fed had announced it
was cutting its base rate to zero and was planning to buy $700 billion in
bonds, but with no effect.
According
to the report, a senior deputy told O’Hanley that “corporate treasurers and
pension managers, panicked by the growing economic damage from the COVID-19
pandemic, were pulling billions of dollars from certain money-market funds.
This was forcing the funds to try to sell some of the bonds they held. But
there were almost no buyers. Everybody was suddenly desperate for cash.”
The
article noted that rather than take comfort from the Fed’s extraordinary Sunday
evening actions, “many companies, governments, bankers and investors viewed the
decision as reason to prepare for the worst possible outcome from the
coronavirus pandemic.” The result was that a “downdraft in bonds was now a
rout.”
It
extended into what had been regarded as the most secure areas of the financial
system.
The WSJ
article continued: “Companies and pension managers have long-relied on
money-market funds that invest in short-term corporate and municipal debt
holdings considered safe and liquid enough to be classified as ‘cash
equivalents.’ … But that Monday, investors no longer believed certain money
funds were cash-like at all. As they pulled their money out, managers struggled
to sell bonds to meet redemptions.”
So severe
was the crisis that Prudential, one of the largest insurance companies in the
world, was “also struggling with normally safe securities.”
The
article provided a striking example of how, when a fundamentally dysfunctional
and rotting system seeks to undertake a reform, it generally only exacerbates
its underlying crisis. This phenomenon has been long-known in the field of
politics, but the events of mid-March show it applies in finance as well.
On the
Monday morning when the crisis broke, Vikram Rao, the head of the debt-trading
desk at the investment firm Capital Group, contacted senior bank executives for
an explanation as to why they were not trading and was met with the same
answer.
“There
was no room to buy bonds and other assets and still remain in compliance with
tougher guidelines imposed by regulators after the previous financial crisis.
In other words, capital rules intended to make the financial system safer were,
at least in this instance, draining liquidity from the markets,” the WSJ report
stated.
The
crisis had a major impact on investors who had leveraged their activities with
large amounts of debt—one of the chief means of accumulating financial profit
in a low-interest rate regime.
According
to the WSJ article: “The slump in mortgage bonds was so vast it crushed a group
of investors that had borrowed from banks to juice their returns: real-estate
investment funds.”
The Fed’s
actions, have, at least temporarily, quelled the storm. But it has only done so
by essentially becoming the backstop for all areas of the financial
market—Treasury bonds, municipal debt, credit card and student loan debt, the
repo market and corporate bonds, including those that have fallen from
investment-grade to junk status.
And, as
Powell made clear in his “60 Minutes” interview, the Fed plans to go even
further if it considers that to be necessary.
“Well,
there’s a lot more we can do,” he said. “I will say that we’re not out of
ammunition by a long shot. No, there’s really no limit to what we can do with
these lending programs that we have. So there’s a lot more we can do to support
the economy, and we’re committed to doing everything we can as long as we need
to.”
The claim
the Fed is supporting the “economy” is a fiction. It functions not for the
economy of millions of working people, but as the agency of Wall Street, ready
to pull out all stops so that the siphoning of wealth to the financial
oligarchy, which it has already promoted, can continue.
An
indication of what “more” could involve is provided in the minutes of the Fed’s
April 28–29 meeting.
There was
a discussion on whether the Fed should organise its purchases of Treasury
securities to cap the yield on short and medium-term bonds. This is a policy
employed by the Bank of Japan that has also recently been adopted by the
Reserve Bank of Australia.
No
immediate decision was reached, but the issue is certain to be raised again.
Over the next few months, the US Treasury will issue new bonds to finance the
operation of the CARES Act that has provided trillions of dollars to prop up
corporations while providing only limited relief to workers.
By
itself, the issuing of new debt would lead to a fall in the prices of bonds
because of the increase in their supply, leading to a rise of their yields (the
two move in opposite directions) and promoting a general rise in interest
rates—something the Fed wants to avoid at all costs in the interests of Wall
Street.
The only
way the Fed can counter this upward pressure is to intervene in the market to
buy bonds, thereby keeping their yield down. This would formalise what is
already de facto taking place, where one arm of the capitalist state, the US
Treasury, issues debt while another arm, the Fed, buys it.
This
would further heighten the mountain of fictitious capital which, as the events
of mid-March so graphically revealed, has no intrinsic value and is worth
essentially zero.
The
ruling class cannot restore stability to the financial system by the endless
creation of still more money at the press of a computer button. Real value must
be pumped into financial assets through the further intensification of the
exploitation of the working class and a deepening evisceration of social
programs.
Financial
crises are presented in the media and elsewhere as being about numbers. But
behind the economic and financial data are the interests of two irreconcilably
opposed social classes—the working class, the mass of society, and the ruling
corporate and financial oligarchy whose interests are defended by the state of
which the Fed is a crucial component.
As 2008
demonstrated, what emerges from a financial crisis is a deepening class
polarisation. That will certainly be the outcome of the mid-March events. A
massive social confrontation, already developing long before the pandemic
arrived on the scene, is looming in which the working class will be confronted
with the necessity to fight for political power in order to take the levers of
the economy and financial system into its own hands.
US billionaires
increase wealth by $280 billion since March, as millions are unable to get
unemployment benefits
“Never allow a crisis to go to waste,”
said Rahm Emanuel, former investment banker, Chicago mayor and White House
chief of staff to President Barack Obama, in response to the 2008 financial
crisis. Emanuel and Obama led the reorganization of class relations in the
United States, cutting social services, education, health and pensions, and
accelerating a shift to temporary and low-paid work. As a result they created
the largest stock market boom in history.
Today, this catchphrase is once again on the
lips of the ruling
class. The largest financial and corporate
powerholders are seeking to use the global
health emergency to expand their wealth and
increase the exploitation of the working class.
The billionaires in the United States have
increased their wealth by $282 billion since the mid-March stock decline,
according to a new report by the Institute for Policy Studies. While more than
one fifth of the American population is now unemployed, and millions are
deprived of basic needs and confront an uncertain future, the fortunes of the
ultra-rich have not only recovered, they are improving substantially.
Jeff
Bezos and his girlfriend (AP Photo/Rafiq Maqbool, File)
Jeff Bezos’s fortune increased by $25 billion
between January 1 and April 15. Never in
history has any individual made so much
wealth so quickly. As the report noted, “this
is
larger than the Gross Domestic Product of
Honduras, which was $23.9 billion in 2018.”
Eight billionaires, so-called “pandemic
profiteers,” have increased their wealth, each, by over $1 billion during this
time: Jeff Bezos (Amazon), MacKenzie Bezos (Amazon), Eric Yuan (Zoom), Steve
Ballmer (Microsoft), John Albert Sobrato (Silicon Valley real estate), Elon
Musk, Joshua Harris (Apollo, financial asset management) and Rocco Comisso
(Mediacom, cable and internet).
Why, when 200,000 have died around the world
and millions more lives are in jeopardy, are the ultra-rich profiting so
fabulously?
First, the bailout package crafted and voted on
unanimously by Republicans and Democrats has funneled wealth to the richest
banks and corporations, while leaving peanuts for the working population.
The $2.2 trillion CARES Act gives only $550
billion to direct payments and extended unemployment, which most people have
yet to receive. Of the remaining more than $1.7 trillion, $500 billion goes
directly to bailing out major corporations. While $377 billion ostensibly goes
to small businesses, most have not seen a penny, as the banks pocketed $10
billion in fees and larger companies largely consumed the available funds.
The CARES Act also contains within it an
additional $173 billion in tax breaks to super-wealthy individuals and
companies. For example, it allows households earning at least $500,000 a year
to reduce their taxes by substantially increasing deductions from business
losses and applying them to taxable money earned on the stock market.
All of this is on top of trillions being
funneled
into the financial markets and corporate
coffers by the Federal Reserve.
Meanwhile, a study from the Pew Research Center
finds that while over 10 million people applied for unemployment in March, only
29 percent of jobless Americans received any benefits that month. The report
says that unemployed workers “face a hodgepodge of different state rules
governing how they can qualify for benefits, how much they’ll get and how long
they can collect them.”
Real unemployment has grown past 20 percent of
the population. Over 26.5 million jobs have been lost, adding to the 7.1
million people who were already unemployed prior to the crisis.
Even when workers receive these benefits, they
come, ultimately, at the expense of state and federal debt. Like in 2008, when
state after state and city after city faced a budget crisis, so too, with COVID-19,
will fiscal problems emerge. Who will pay when budgets are exceeded? As in
Detroit, Michigan and Stockton, California in the aftermath of the 2008
financial crisis, the ruling class will once again say, “There is no money” for
basic social services such as education and clean water. Meanwhile, trillions
are funneled to the ultra-wealthy.
A second reason the pandemic has been a bonanza
for the ultra-rich is that it has intensified corporate consolidation,
part-time and temporary work, and digital and physical automation.
Bloomberg writes: “Big
Business Has All the Advantages in the Pandemic.” While most small businesses
are on the rocks--deprived by larger firms of the small funding that was
theoretically given to them in the CARES Act--many large corporations, such as
Amazon, are carrying out a massive hiring spree. Walmart plans to hire 150,000
people by May; Amazon, 100,000; and Dollar Store, 25,000.
Because larger firms are more likely to have
the capital not only to weather the crisis, but to dominate internet-based
commerce, they will come out of the crisis with even greater domination of
their market. In particularly hard-hit industries, such as the oil and gas
sector, the giant companies like Chevron and ExxonMobil see the crisis as an
opportunity to purchase their smaller competitors.
The Financial Times likewise
writes that “Covid-19 will only increase automation anxiety” as companies
“pandemic-proof their operations.” Capitalism has a natural tendency toward
automation, which in the long term breeds economic crises and joblessness. Mark
Muro, a senior fellow at the Brookings Institution, says COVID-19 will spur a
“surge of labour-replacing technology,” as automated cashiers, cars, logistic
robots and automated assembly lines replace workers. Again, the largest
companies will emerge on top because they are the ones that can afford this
automated overhaul.
Capitalism’s fundamental trajectory—toward
increasing automation, temporary and part-time work, corporate consolidation,
ever increasing inequality and financial bubbles—will intensify. The result, in
turn, will be an ever more staggering concentration of wealth in the hands of
the few.
The socialist response to the COVID-19 crisis
demands that this mass of wealth be confiscated. The major companies which
dominate our lives cannot be run for the private profit of a handful of
billionaires who seek to squeeze the working class, literally, to death. They
must be placed under the social and democratic control of the working class.
By David North
The whole process should be tightened up and made more expensive, if not suspended for the rest of the year. My point is that the system is currently designed in such a way that the layoffs of U.S. workers can be expected if both H-1B workers and U.S. workers are employed in the same firm.
Unemployment is up for all healthcare workers, including physicians
Legal or not, many immigrants certainly do work as healthcare professionals in the United States. That should not be surprising in a nation where 17 percent of the labor force is foreign-born. It is also not surprising that immigrants are overrepresented among doctors, given that we have selected for them through the H-1B and J-1 visas.
It does
not follow, however, that we would have a terrible shortage of doctors in the absence of past immigration. For one thing, lower immigration would mean a smaller population, and smaller populations need fewer doctors. More to the point, no
"shortage" of any workers should develop under a properly functioning labor market. With 280 million native-born individuals and a vast system of higher education, there is no reason that Americans would not have been able to meet the demand for doctors that immigrants gradually filled over the past decades.
Of course, the labor market takes time to adjust. A sudden pandemic could generate a spike in demand for doctors without an immediate supply response. That is the premise of the proposed
Healthcare Workforce Resilience Act (S.3599), which would grant permanent residency to 25,000 nurses and 15,000 doctors, plus their families. It's a solution in search of a problem, however, because
the spike in demand for healthcare workers has not materialized . On the contrary, demand appears to have fallen.
The table below shows that unemployment rates for healthcare workers have increased since February, which is the last month before Covid-19 hit. This trend is the opposite of what we would expect if there were a dire need for more workers.
Employment Trends for Healthcare Workers
Total Employed
Unemployment Rate
Sample Size
Health Care Occupation February April February April February April
Physicians 605,222 528,123 0.4% 1.4% 224 167
Registered Nurses 3,180,835 3,075,449 0.9% 4.3% 1,228 1,036
Licensed Practical/
Vocational Nurses 741,816 636,117 2.0% 2.4% 261 189
Nursing Assistants 1,501,753 1,367,440 3.1% 7.8% 542 473
Medical Assistants 624,489 516,140 1.7% 13.6% 212 168
Source: Current Population Survey.
Occupations limited to sample sizes of at least 100.
At 1.4 percent, the unemployment rate for physicians is still low, but it's
up from 0.4 percent, implying no shortage. Registered nurses have an unemployment rate of 4.3 percent, up from 0.9 percent. The less-skilled healthcare occupations have been hit even harder, with the unemployment rate for medical assistants rising from 1.7 percent to 13.6 percent. The
decline in demand for health services unrelated to Covid-19 is the likely cause.
Under the Healthcare Workforce Resilience Act, it is unclear which jobs the new doctors and nurses would fill. Even if demand increases in the near future, the Americans who recently lost their jobs would be the obvious source of workers to draw from.
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