This week's big news was that over 85,000 new H-1B visas got used up in 2 days. Here are my thoughts about why that might have happened and why any new bill needs to have provisions to keep this from happening:
I know two programmers who came here on H-1B visas. One came back in January and the other one came in the first week of March. Both are still in the process of doing phone or in-person interviews. So, there never was a job for which they were hired, nor is there such a job shortage -- even at the cheap rates at which they will eventually be hired -- that they could find jobs quickly.
Allowing middlemen to secure blocks of visas (note that this happens with H-1B as well -- not just L-1) thus creates an artificial shortage. For instance, if a legitimate US employer wants to now apply for an H-1B visa, they will find that there are no visas available for a whole year. So, the intent of the H-1B visa has been circumvented in legitimate cases. And it contributes to the general feeling that the number of available visas is insufficient.
Also, this practice places the middlemen in the driver's seat as a) they get to dictate the terms of how the visa holders in their stable will be farmed out and b) employers must deal with them if they want to hire cheap. Especially when combined with the fact that, at least in some cases, the middlemen don't even bear the cost of paying for the H-1B visas, the current H-1B program is a sort of entitlement program for the middlemen. I have known instances where a programmer was sub-contracted 3 levels deep and each middleman took a cut of the hourly wage. The programmer who does the actual work gets very little money. Thus the system facilitates the exploitation of the hapless H-1B visa holder.
Another scenario is where I met a man who is here on an L-1 visa through an Indian outsourcer (P) and is working at a large local multi-national (MNC). This visa / job should rightly appear in the LCA database and elsewhere as used up by the MNC, not the outsourcer P. This has two detrimental effects:
a) So long as outfits like P are allowed to engage in this practice, American programmers do not have even a shot at those jobs.
b) The MNC is shielded from the negative PR that would result if the extent of their H-1B visa usage were to become widely known.
I understand the new Durbin-Grassley bill has provisions that address many of the abuses of the H-1B program. I am not familiar enough with the anti-outplacement ones to know whether the above types of practices would be curtailed by the bill.