Gates Warns of Software Replacing People; Greenspan Says H-1Bs Fix Inequity 516
dcblogs writes "Bill Gates and Alan Greenspan, in separate forums, offered outlooks and prescriptions for fixing jobs and income. Gates is concerned that graduates of U.S. secondary schools may not be able stay ahead of software automation. 'These things are coming fast,' said Gates, in an interview with the American Enterprise Institute 'Twenty years from now labor demand for a lots of skill sets will be substantially lower, and I don't think people have that in their mental model.' Meanwhile, former Federal Reserve Chair Alan Greenspan believes one way to attack income inequity is to raise the H-1B cap. If the program were expanded, income wouldn't necessarily go down much, but it would go down enough to make an impact. Income inequality is a relative concept, he argued. People who are absolutely at the top of the scale in 1925, for instance, would be getting food stamps today, said Greenspan. 'You don't have to necessarily bring up the bottom if you bring the top down.'"
I have been on an H1-B for the last 9 years (Score:5, Informative)
And that Greenspan and Gates are telling you about H1-B's is only half the story.
The other half of the story is that there aren't enough Green cards to give out for the H1-B's that are in line for them. So you end up with H1-B workers in essentially indentured servitude to their employer with no bargaining power driving down wages for everyone else.
Increasing Green cards for existing H1-B workers currently in the US will help the US economy a lot more than creating more indentured servitude.
A little background: The number of Green cards is set by Congress. In 1999 congress increased the number of H1-B's to 190,000 but left the number of employment based Green cards at 135,000. The rule of thumb is that you need 2.2 Green cards for every H1-B issued to satisfy demand (because H1-B workers normally come with spouses and kids). To satisfy demand, they should have increased Green cards to 400,000 when they increased the H1-B numbers to 190,000 - but they didn't.
This created a huge backlog of people waiting for their Green cards - including me. I am 31 years old, I did some math, I will be 62 by the time I get mine at the current rate.
The corporations LOVE the idea of creating more H1-B's but you don't hear a peep about increasing the number of Green Cards. They claim that increasing H1-B's will increase innovation and so on - but without a commensurate increase in Green cards, that is complete nonsense. Someone who has been stuck at the same job for decades can hardly innovate.
FYI: Congress is trying to increase the number of H1-B's without increasing the number again (to the magic 195,000 again) http://beta.congress.gov/bill/113th-congress/house-bill/2131 . Call your Congressman/Senator and tell him/her to vote against the bill unless it includes a commensurate increase in H1-B's. The Bill is HR-2131. http://beta.congress.gov/bill/113th-congress/house-bill/2131
Re:Greenspan's right (Score:5, Informative)
I guess you haven’t looked anywhere in the direction of Rincon Hill in the past few years. Or been to South Beach, or Mission Bay, or looked at Lennar’s plans for the Candlestick area. I look forward to all this luxury development increasing the housing supply and driving down rents. I’ll just be over here not holding my breath.
Re:Is lifting H1-Bs going to push down CEO pay???? (Score:4, Informative)
You have a very nonstandard definition of “rich” if it encompasses the entire top quintile. (Of modern industrial/post-industrial civilizations — we’re not talking about compared to Haiti.)
Re:Greenspan's right (Score:4, Informative)
Here's a better idea Mr. Greenspam. How about we make your pay equal to everybody elses? (My insulting consulting invoice is issued by the way)
You'd pay him that much?
Even after his tragicomic “Those of us who have looked to the self-interest of lending institutions to protect shareholders’ equity, myself included, are in a state of shocked disbelief"; but, not to worry, “Whatever regulatory changes are made, they will pale in comparison to the change already evident in today’s markets...Those markets for an indefinite future will be far more restrained than would any currently contemplated new regulatory regime.” performance?
(I guess, horribly enough, the fact that the events of the day did move him to concede that the 'free markets just full of rational actors!' model...might have a few weak spots... actually makes him a better empiricist than more than a few other economists in that camp.)
Re:Need for long-term view of society (Score:4, Informative)
No one in the United States has problems with food, clothing, or shelter.
Is this like Ahmadinejad saying there are no homosexuals in Iran?
Because the 600,000+ [wikipedia.org] homeless people in the United States certainly have a problem with shelter.
Re:Fuck that (Score:5, Informative)
You can read a transcript of Greenspan's comments (with obvious errors) here:
The relevant portion starts at 00:39:11 and it's just a hot mess.
So my view is to recognize that what is causing this low rate of growth in average hourly earnings is basically so proud of -- slow productivity.
This is, quite frankly, shocking for him to say.
Wage growth has only slightly outpaced inflation despite decades of massive productivity increases.
He comes back to immigration at 00:47:53
I thought maybe TFS and TFA mischaracterized Greenspan's comments.
Nope. He's advocating depressing wages for white collar workers instead of raising wages for low income earners.
The only redeeming quality of Greenspan's testimony is it shows that the housing crisis shined a spotlight into his ideological blind spot.
Now he's advocating for stronger fraud controls and higher capital reserves/better collateral requirements in the banking system.
So in his ideal world, the banks won't screw you, but you'll have no money to put in the bank because your wages are depressed by H1B workers.
Re:How? (Score:4, Informative)
No one will read this, but that's ok.
Ironically, either people will ignore you, or offer some stupid counterpoint about how you can't do that.
I got out of college (where I didn't have loans, but went part time with a night job fo many years) and quickly made an exciting job at a call center for $8 an hour.
I live(d) within my means, and after taking pay cuts even more to try and get ahead in a career. I had roomates, split rent, car pooled, etc. I had and have nothing but shit cars my life. I shop and Walmart and mostly Goodwill or army surplus stores for clothes.
I didn't get a mortgage for a home. I got two full time jobs, one W2 and one 1099, and balanced between them. Within two years I bought a small home for cash. I then bought another small home, because I could rent out the existing one, and I live cheap. Now I have a free home, and one providing rental income, so I'm profiting on it as an additional income stream.
Now work doesn't matter. It was a lot of stress having two jobs, and I had to kiss a lot of ass to balance it, but now I can live on one. I take extra jobs now and then (above my full time one) to gravy a bit more on my assets. I have few bills, so I'm maxing out my savings. Since the beginning I maxed anything I could save and lived on the smallest amount I could. i never went the management track so I wasn't locked into one company.
Now I have hundreds of thousands in the bank and tax free investments and I lost plenty in the real-estate bust before that. However I have no debt, I have assets. My held liabiilities (real estate) is offest by rental income.
I've helped some coworkers in the philosophy of getting out of debt, and now, like a crazy cult, we meet at lunch and they're excited about how soon they'll pay off a second mortgage, or a car, and things like that. They actually LIKE the idea of doing math and setting budgets, and seeing how a $20 here and there in expenses can cause large changes to their debt levels.
As a counter point, people used to tell me that I'm living life not to its potential, not having fun, I might die any moment, or I'll retire early and not be healthy enough. I am constantly abused by friends telling me to spend money (above the triple minimum wage I've set myself at) because I'm...what...not keeping up with the Jones' or something?
I remember being mocked, because in 2007 I was talking to my boss about buying a home and I was looking at some double wides on an acre, or a cheap 2/1 outside of town, and being told I was "stupid" because I should get a mortgage for as much house as I could max out on my credit. I guess I disappointed him.
Re:How? (Score:4, Informative)
All good, except....
> don't borrow money... not for a house
That depends - a home is a *secured* loan. You can always 'give it back' and rent. A *humble* home is better than renting for decades.
> You don't need to drink, to ..., to have a spouse or to have children.
No. (Almost all) people *need* a spouse. For love, for the work of life. On the purely economic side, its efficient to have 2 (or 1.5) incomes to pay one mortgage, two people to share household goods, groceries, cooking, cleaning...
> ... you *wlll* have money unless your health significantly fails.
Your health will (almost certainly) fail if you strike it out without a spouse.
Re:Living in 1925 kinda sucked (Score:5, Informative)
The rich earned 25% more in 2013 than 2012. Can you imagine if middle-class workers took home 25% more pay one year over another instead?