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United States Canada Government Microsoft

Microsoft On US Immigration: It's Our Way Or the Canadian Highway 365

theodp writes Even as it cuts about 14% of its workforce, Microsoft is complaining that the company might be denied some of the "roughly" 1,000 H-1B visas for foreign workers it intends to seek, and made it clear that the company could shift some work to Canada or overseas if it can't get talent on its terms. "If I need to move 400 people to Canada or Northern Ireland or Hyderabad or Shanghai, we can do that," said William Kamela, a senior federal policy lead at Microsoft, who later explained that about 60% of Microsoft's workforce is in the U.S., yet it makes 68% of its profits overseas (where it also stashes its cash out of IRS reach). Kamela made the statements on a panel at a two-day conference on high-skilled immigration policy, where he sat next to Felicia Escobar, special assistant to President Barack Obama on immigration. The day before the conference, Mark Zuckerberg's FWD.us PAC — which counts Bill Gates as a Founder and Steve Ballmer and Microsoft General Counsel Brad Smith as Major Contributors — posted its "MythBusters" video on H-1B visas.
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Microsoft On US Immigration: It's Our Way Or the Canadian Highway

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  • Fine! (Score:5, Interesting)

    by DaMattster ( 977781 ) on Thursday September 25, 2014 @08:50AM (#47992257)
    Let them move jobs overseas. In retaliation, we the people should demand that the government ditch all Microsoft products and go open source!
    • Re:Fine! (Score:5, Interesting)

      by Luckyo ( 1726890 ) on Thursday September 25, 2014 @09:49AM (#47992759)

      Better idea. For every piece of work they shift, their taxes go up to support communities they dump. As in, they are forced to shoulder the real costs of outsourcing, rather than "outsourcing" the cost to the tax payers.

      But in today's system, where corporations are people with human rights and capital has more rights than most people, that's not going to happen.

    • Re: (Score:3, Insightful)

      by Seumas ( 6865 )

      If you don't let me not employ Americans in America, then I'm going to go not employ them outside of America!

      Then why bother capitulating to them?

    • by gnupun ( 752725 )

      In retaliation, we the people should demand that the government ditch all Microsoft products and go open source!

      And how does that solve the problem? Since open source does not pay its developers (in most cases), developers don't get paid whether MS outsources or if open source products are used.

      • Since open source does not pay its developers (in most cases), developers don't get paid whether MS outsources or if open source products are used.

        ...actually, you'd be amazed at the number of OSS devs who do get paid; many are hired by OSS-based companies (e.g. RedHat), but many more are hired by large tech firms who find it in their interest to do so, such as Intel, IBM, HP, Dell (no, seriously!), and etc. Intel still has a sizable OSS dev group, for instance.

    • I don't think we should do that. We should just start moving away from free trade arrangements. Go back to having tariffs likely through a VAT with subsidies for domestic job creation. That way Microsoft can contribute to the economy by providing jobs or they can can contribute by (indirectly) paying tariffs to import their work from overseas.

  • "stashes its cash" (Score:5, Interesting)

    by therealkevinkretz ( 1585825 ) on Thursday September 25, 2014 @08:52AM (#47992277)

    Only the US charges income tax on profits from foreign subsidiaries which have already been taxed abroad. Besides being unfair, such a disincentive to bring the money into the US obviously discourages the spending and employing here that could be done with it.

    • by hherb ( 229558 )

      Australia too charges income tax from money I earn abroad - namely the difference between the obscenely high Australian taxes and the much lesser taxes I pay in most other countries, even if I earned the money while working and living in those other countries

      • Re: (Score:3, Informative)

        by Anonymous Coward

        That's because you claim Australian residency in addition to being an Australian citizen. If you claimed residency overseas they would stop doing this.

        http://en.wikipedia.org/wiki/International_taxation

      • Australia too charges income tax from money I earn abroad - namely the difference between the obscenely high Australian taxes and the much lesser taxes I pay in most other countries, even if I earned the money while working and living in those other countries

        shhhh! You're new to America bashing aren't you?

        So if Microsoft moves to Canada, does that mean they'll at least say "sorry" every time they do something bad?

    • You may have a good point, but you'd need to provide more of an explanation. Given that it's been a known loophole for companies to shuffle money and profits to offshore "subsidiaries" or "parent companies" in low-tax countries, why should we ignore it and open that loophole up? I'm not very familiar with the situation, and I'd need a better explanation before I believed you that this is unfair, or a real problem.

      See, there are a bunch of idiots out there who think in terms of, "Whenever we tax rich peop

      • by gtall ( 79522 )

        No one is arguing that. What the right wing argues is that the rich people are investing their money and not stuffing it in their mattress. So the theory is that if you whack them, they won't invest as much. I have yet to see a real analysis that proves or disproves this. Personally, I'm doubtful the effect of their investment with untaxed dollars amounts to all that much if you subtract out the investment government would make with those same dollars and if you subtract the amount rich people invest outsid

        • No one is arguing that.

          Oh no, there are people arguing that. It's true that there are some people in the right wing pointing out that rich people invest money, but there are an awful lot within the right wing who, when you figure out what they're actually arguing, it boils down to "If you tax rich people, they no longer have an incentive to be rich, and they will stop driving economic growth with their magical rich-people super-powers. I can't explain how any of this works, but I will tell you that rich people have magical rich

    • The foreign subsidiary being a P.O. box in a country that doesn't tax them.

      It's a corruption. They get loopholes that allow them to get out of taxes as long as their money stays overseas, but then every 10 years or so we have a "tax holiday".

      They belong in jail.

    • by gtall ( 79522 )

      Yes, but it sounds like if MS could bring all their cash home, the jobs they'd like to create would go to H1Bs. So what is precisely the difference except that H1Bs must spend some of their dough to live in America.

      Big American companies seem to want it both ways. Be protected by American laws, bring foreign-earned cash back to America to hire foreign H1Bs.

  • by Iamthecheese ( 1264298 ) on Thursday September 25, 2014 @08:56AM (#47992301)
    The only reason politicians pretend to listen to arguments like Microsoft is making is the money passing under the table. The only reason Microsoft needs to argue this point at all is to present the pretense that politicians are uninformed, as opposed to corrupt.
  • Cake and eat it too (Score:5, Interesting)

    by sinij ( 911942 ) on Thursday September 25, 2014 @08:58AM (#47992311)
    Corporations want infrastructure, rule of the law, and educated workforce that comes with doing business in US while paying third-world wages and hiding income in tax shelters. You can't have it both ways.

    I also highly doubt that Canada, for example, going to look any more favorable on work visas. If they move to Canada, they will have to hire Canadians (or people eligible for NAFTA visas). That won't be 25K/year PhDs from India.
    • by Shados ( 741919 )

      You're right, it won't, but it will still be 10, 20, or even 50% cheaper depending on where they open office.

      That said, a lot of the H1B visas they get ARE to hire Canadians, at the same salary they hire Americans.

      Those Waterloo undergrads that go to in Boston/NYC/SF don't work for cheap, and they prefer H1Bs to TN status.

    • Canada is much more business friendly than the US, believe it or not. The corporate tax rate is even lower :)
      • by s.petry ( 762400 ) on Thursday September 25, 2014 @09:42AM (#47992689)

        If you incorrectly believe that _everyone_ pays the US 35% corporate tax sure, the US has the highest corporate tax rate. You would have to be extremely ignorant or gullible to believe that anyone pays the base rate. 70,000 pages of tax code are currently ensuring that anyone that can afford an a loophole has a loophole.

        If we had any legitimacy in the Government, I would expect the Government to be asking why Microsoft just terminated 18,000 employees (including no-competes preventing their hire at MS or anywhere else) and is now requesting 1,000 more foreign workers.

        For those that claim that H1Bs have nothing to do with wages, I'd ask the same exact question.

        • If we had any legitimacy in the Government, I would expect the Government to be asking why Microsoft just terminated 18,000 employees (including no-competes preventing their hire at MS or anywhere else) and is now requesting 1,000 more foreign workers.

          You can ask the question but the answer is simple. (whether the answer is actually honest or not is a different issue) What Microsoft would say is that those 18,000 workers didn't have the skill sets needed by the company going forward. If you fire an accountant you cannot replace him with an engineer. Not all people and jobs are interchangeable. I personally have had to fire people and hire different people precisely for this reasons. Even if they are lying through their teeth, this answer provides

        • by Chrisq ( 894406 )

          If you incorrectly believe that _everyone_ pays the US 35% corporate tax sure, the US has the highest corporate tax rate. You would have to be extremely ignorant or gullible to believe that anyone pays the base rate.

          A lot of people do. They are the hard working local stores, builders, mom & pop hotels, and so on. Its only the big guys get exemptions.

    • by sjbe ( 173966 ) on Thursday September 25, 2014 @09:27AM (#47992539)

      Corporations want infrastructure, rule of the law, and educated workforce that comes with doing business in US while paying third-world wages and hiding income in tax shelters. You can't have it both ways.

      So far they very clearly have been able to have it both ways. Sad but true.

      Now let's be fair that Microsoft in general is not paying "third world wages". You only have to look at their financial statements to prove that. They generally pay their employees fairly well. That said, I think they are being more than a little disingenuous in claiming they need workers from overseas when they have net profit margins well in excess of 20%. Microsoft's problems aren't with their costs but with their revenue streams and no amount of cheap overseas talent is going to solve that problem.

    • by m00sh ( 2538182 )

      Corporations want infrastructure, rule of the law, and educated workforce that comes with doing business in US while paying third-world wages and hiding income in tax shelters. You can't have it both ways.

      By the same argument, we want high wages through government intervention and artificial barriers to labor just by the virtue of the luck of being born on the right side of the line. At the same time, we want to buy the cheapest parts and gadgets manufactured in China so we can consume more even though it costs the manufacturing sector in the US.

      We also want it both ways as well. Everybody wants it both ways.

      The goal is to find the balance that is best for everyone.

    • Corporations want infrastructure, rule of the law, and educated workforce that comes with doing business in US

      What, you think Canada doesn't have an educated workforce?

  • by gcnaddict ( 841664 ) on Thursday September 25, 2014 @08:59AM (#47992317)
    so please let us hire more overseas. Please?

    Pretty Please?
  • by slashmydots ( 2189826 ) on Thursday September 25, 2014 @09:12AM (#47992417)
    It has nothing to do with training or intelligence and everything to do with money spent on wages.
  • by Luthair ( 847766 ) on Thursday September 25, 2014 @09:19AM (#47992465)
    All these tech companies simply need to open a few satellite offices. Inherently some people don't want to be in San Fransisco, Redmond, etc. if you can't find the talent you need perhaps you aren't in the right area?
    • This!

      Despite NE Ohio's obvious downside (namely, the weather), I would never leave the area for a job in SF making $150k / year. That's a fine salary - more than I'm making now - but would diminish my standard of living as compared to NEOH. Answer? Open an office in Solon or Beachwood or on the west side in Westlake or Rocky River (but please, not Cleveland proper - what a dreadful city that is). Paying $100-$150k / year would allow a family to live quite nicely in those areas.

    • Exactly! Why should I give up my nice house in Atlanta (not to mention my friends and family) for the "privilege" of living in some overpriced hovel in California? After adjusting for cost-of-living, I'm paid better than I would be at a comparable job there.

    • by Rich0 ( 548339 )

      All these tech companies simply need to open a few satellite offices. Inherently some people don't want to be in San Fransisco, Redmond, etc. if you can't find the talent you need perhaps you aren't in the right area?

      Agree. Either that or let people work remotely. I bet there are a lot of people who simply don't like living in big cities/etc who would be able to contribute, and at far less cost.

  • by sjbe ( 173966 ) on Thursday September 25, 2014 @09:21AM (#47992483)

    who later explained that about 60% of Microsoft's workforce is in the U.S., yet it makes 68% of its profits overseas

    Which is pretty much irrelevant when it comes to software. There is no need at all in software to match development costs to geographic locations. It's one of the beautiful things about being in that industry. That's why you can have a development team in India for a product that isn't even sold there and it still makes sense. It's not a tangible good you export.

    Now if they cannot get the right talent for the right price domestically then sure they might have to look elsewhere but frankly I doubt that is really the core problem for Microsoft. If they are having trouble getting good talent I think it has a lot more to do with the fact that people are well aware they have a pretty toxic corporate culture where everyone has to have their knives out at all times and so much of the best talent decides to work elsewhere. Microsoft is just not an attractive place to work compared with Apple or Google or some of the other top IT firms.

    It's also a little disingenuous to claim you need cheaper talent when you have net profit margins well above 20%. Microsoft's problems are not rooted in their cost structure but in their revenue streams. Their problems are that their key revenue streams (Windows and Office) are tied to tightly to the PC market and they haven't been able to translate them very well to the mobile market. They spent so many years trying to maximize their monopoly on the PC they they found it difficult to acknowledge that mobile devices have different requirements and to relax their grip so that they could grow. Microsoft saw the opportunity in mobile 10-15 years ago but kept trying to cram a PC into a mobile device with predictably bad results.

    • who later explained that about 60% of Microsoft's workforce is in the U.S., yet it makes 68% of its profits overseas

      Which is pretty much irrelevant when it comes to software. There is no need at all in software to match development costs to geographic locations.

      But it's relevant to the protectionist arguments people use.

      People essentially claim that hiring workers outside the US is dishonest because they're an American company making money from the US. But most of their business (or at least their profit) comes from outside the US, if Microsofts' worker distribution matched its profit distribution (which may not be highly related to revenue distribution) then only about 30% of the workforce would be in the US. The current state of the company structure means that

      • That being said it kinda dodges the question of why they need more HB1s after laying off a ton of people whom presumably had the necessary qualifications.

        You cannot presume that. While it's certainly possible that some of them did have the necessary qualifications, it is also quite possible (likely even) that most did not. If you fire an engineer you cannot replace them with an accountant or even necessarily a different engineer with a different skill set. Even if they did have the qualifications that does not mean they were available and willing to work in the jobs that Microsoft had available. To make up an example, if they fire some guy in Finland fro

    • There is no need at all in software to match development costs to geographic locations.

      Not completely true. There is value in having developers who are from the countries where you sell your products because their understanding of the local culture and context can help them to design and build products better suited to the customer base. But assuming you address that issue (or just don't care about it), yeah, dev shops can be anywhere and everywhere.

    • by Rich0 ( 548339 ) on Thursday September 25, 2014 @10:24AM (#47993119) Homepage

      That's why you can have a development team in India for a product that isn't even sold there and it still makes sense. It's not a tangible good you export.

      This is the thing I don't like. Companies play both sides of the fence.

      If I start selling copies of Win8, I'll be put in jail because I'm stealing MS's property.

      If MS sells a copy of Win8 in the US, they have to pay a licensing fee to MS Caymans for the rights to sell Win8 in the US, so the US company doesn't make much profit but they'll happily report that profit in the Caymans at a 0% tax rate.

      On the other hand, when they want to install Win8 on 10M computers and the code was written in India, well, they just FTP that over with no tariffs because it is an intangible good that has no legal value for customs purposes.

      If MS had to pay duty on 10M copies of Windows (at full retail cost) to have a 3rd party install copies on 10M computers, then I bet they'd rethink their development model.

  • [William Kamela] later explained that about 60% of Microsoft's workforce is in the U.S., yet it makes 68% of its profits overseas

    Those figures don't compare well, at least not to justify moving Microsoft out of US. The US is one country versus about 200 others; the latters' population is more than 200 times that of the US.

    The only conclusion I can make from that figures is that it is very likely that the US is the single country Microsoft makes more profit from.

  • the H-1B video is BS: The jobs created by letting those guys in is mostly support economy as in stores/home care/restaurants the foreign workers spend the money. In essence they want the locally trained STEM guys to get those jobs instead. They have never demonstrated that there is such a need for locally trained STEM guys because if they do they'll put money into it to encourage people to take the training and jobs. I wonder why those company never seem to need locally trained STEM people. Is it beca
  • Mythbust this! (Score:5, Informative)

    by PlanetX 00 ( 623339 ) on Thursday September 25, 2014 @10:09AM (#47992983)
    It is all about keeping wages down: Microsoft cuts 2,100 jobs in its latest round of layoffs (http://www.engadget.com/2014/09/18/microsoft-layoffs-round-2/) Intel to cut over 5,000 jobs (http://money.cnn.com/2014/01/17/technology/intel-jobs/) Cisco plans 6,000 layoffs in restructuring plan (http://www.bizjournals.com/sanjose/news/2014/08/13/cisco-plans-6-000-layoffs-in-restructuring-plan.html?page=all) https://www.youtube.com/watch?... [youtube.com]
  • Most large tech businesses are following this strategy.They are just responding to our illogical tax and immigration policies. The US can compete, or try to be a self-sufficient island. Like it or not: Workers compete for jobs. Businesses compete for customers. Governments compete for businesses. All three compete for capital.
    • by jbolden ( 176878 )

      Self sufficient island sounds good. Especially since I suspect Europe, Japan and a nice chunk of the 3rd world would join a less corporate driven island.

  • by Virtucon ( 127420 ) on Thursday September 25, 2014 @10:18AM (#47993057)

    Come on Microsoft, stop the horseshit and just hire workers from within the US. You fucksticks have had it your way too long.

    http://www.youtube.com/watch?v... [youtube.com]

  • by Kagato ( 116051 ) on Thursday September 25, 2014 @10:35AM (#47993225)

    I'm fine with H1B sponsorship, so long as a company can show they put an equal about of time, money and resources into college hire and training programs. When I first started programming it was very common for me to see programming interns and college hires. I consult with many mid and large companies, and I haven't seen a programming intern in 7 years. I've seen two college hires in that time as well. At some point in the 2000s some bone headed bean counter figured they could pay an H1B about the same as a college hire. If that's the case, hire the "experienced" resource. The problem is that created a devastating hole in Junior level programmers for almost a decade. Now companies are finally starting to hire college folks again they want to increase the H1B levels again, and repeat the cycle over again.

  • It's not on display in their current business. Windows 8.1, Office, xbox, windows phone, where? Also, let's not forget that they are busy laying off many/most of the former Nokia engineers in Finland that actually had to design, build, and compete in a competitive world market and replacing them with...who?
  • by DarthVain ( 724186 ) on Thursday September 25, 2014 @11:19AM (#47993657)

    Canada would welcome the jobs. One could also argue that at least moving the jobs to Canada would have a larger net positive impact on the US economy anyway due to our trade relations. Not to mention if you are a unemployed US tech worker, a move to Canada for work isn't that big a deal either.

  • by Eravnrekaree ( 467752 ) on Thursday September 25, 2014 @11:54AM (#47994001)

    This ought to be an outrage and insult to American citizens who are being kicked out on the street by having their jobs stolen from them so that Bill Gates can add to his billions dollar fortune. Studies have shown that there is a surplus of American workers, which means we have a lot of people in this country who cannot find work becuase the work is being stolen by foreign immigrants, illegal aliens, H1B visa holders, and so on. The H1B visa program is a scam designed to enrich the 1%. That Obama is involved with this shows what Obama really is, a traitor who hates the United States, and who does everything he can to undermine our citizens. It is time to completely abolish the H1B program, and stop all immigration. This will as well create the press and necessity we need to fix our own countries problems, such as improving our education system, and promoting family values, such as marriage, so that we do raise healthy (mentally and otherwise) workforce. You cannot have a country without borders. Ultimately I fear what drives companies such as Microsoft is that they are globalists that want to eventually dissolve the United States and as well destroy it as a unique entity.

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