As to be expected, the chambers of commerce and lobbies representing people in the U.S. on employment visas from other countries are waging war against the White House in an attempt to water down if not outright end President Trump’s immigration bans. The U.S. Chamber of Commerce and two other business associations, as well as attorneys representing H-1B visa holders, have filed lawsuits. What all these groups have in common is they are the contingent beneficiaries of programs that displace Americans in favor of cheap, easily exploitable labor from overseas.
To add insult to injury, the well-monied interests have unleashed a propaganda storm through almost every notable mainstream media outlet seeking to convince Americans that not only is there “NO” labor shortage, but skilled Americans cannot be found to fill the white-collar jobs they seek to outsource and offshore. We know this is rubbish. Although we may have been schooled to never pick a fight with the man who “buys ink by the barrel,” our grassroots efforts are having an impact.
We saw earlier this week senators Lee and Durbin clash in Congress over more attempts to pass versions of S. 386 and other legislation designed to favor foreign workers over American workers. I stated back in January that no immigration legislation would pass in an election year. This week’s floor drama was of course political theatre. Yet in it we got to see the fruits of all our efforts.
Sen. Lee admitted he was catching a lot of flak from not only his constituents but working men and women from across the country for placing the interests of corporations and foreigners over Americans. Perhaps he has come to realize the “sacrifice” he made for the corporatocracy just wasn’t worth it. He has also been called out by Tucker Carlson who referred to him as a shill for Google.
The Tennessee Valley Authority (TVA) campaign we launched last week is going great guns. I’m hearing management is looking for heads and not happy at all that the spotlight is being shined on them night after night through our ads on local broadcast and cable channels.
Additionally, when Americans find out about these displacement schemes, they become enraged. After reading Joe DiStefano’s article in The Philadelphia Inquirer about Vanguard’s decision to outsource 1,300 jobs, I was approached by a person with investments in the company who wrote a letter to the CEO chastising him for departing from the company’s tradition of taking care of its employees and treating them as the integral part they are in the company’s value chain:
Mr. Mortimer J. Buckley
President and Chief Executive Officer
P.O. Box 2600
Valley Forge, PA 19482
Dear Mr. Buckley:
As an investor in Vanguard, I am writing to let you know of my anger over your decision to outsource 1,300 crew members to the Indian consulting firm, Infosys. According to a recent article in a local newspaper, the jobs that will be outsourced include record-keeping, client administration, operation and technology. I am not assuaged by Martha King’s assurances of a seamless transition for several reasons.
Infosys is not only a company headquartered in India, it is an H-1B visa-dependent company whose workforce here in the United States is composed largely of expatriates predominantly from that country. Although many of Vanguard’s workers, like Ms. King, will be “rebadged” as Infosys employees, we know from experience this kind of outsourcing is the steppingstone to ultimately offshoring many of these jobs entirely to India, and the rebadged are then released.
Investors typically applaud cost-saving measures. But a savvy investor looks not just at next quarter or the following year’s 10K. Rather, we sound the alarm when we see how the actions of management can negatively impact the company, the industry and perhaps even the country in the long term.
I am not naïve. I know full well that many companies in your industry have adopted outsourcing and offshoring models. Many companies in the United States view their employees as expensive, undeserving and expendable. But they are being shortsighted. Greed makes them lose sight of how draining jobs can, and does, hurt productivity and innovation in the long term. Our company was founded on the simple premise that there should be no outside owners seeking profits. By outsourcing key functions and jobs to a company with a terrible track record for maximizing its corporate profits through labor arbitrage, you have effectively lost control of your ability to drive innovation and performance.
Jack Bogle, Chairman and CEO from 1975 – 1996, stated that “even one person can make a difference.” There was a time when outsourcing meant moving just low-skill jobs to low-cost countries while retaining high-skilled jobs. This is no longer the case.
Our crew members are both highly skilled and experienced. If Infosys stays true to past practices, it will eventually remove/fire the rebadged Americans once a modicum of knowledge transfer has taken place, give those jobs to lower cost expatriates or offshore entirely for rates that would be far below poverty here in the United States.
In the long run, this “brain drain” will have repercussions as the client service feedback loop we rely on for continual improvement will be broken. Understand, once these skills have been offshored, they will never come back. Over time, there will be fewer and fewer opportunities for Americans to work at Vanguard. Today we know our employees come to work each and every day with the single focus of giving “Vanguard clients the best chance for investment success.” Sooner, rather than later, that will no longer be the case.
Vanguard is far more than an investment company. For investors like myself, workers and management, it is an economic ecosystem. The bottom line, short-term gain that accompanies outsourcing/offshoring will be eclipsed by the long-term damage to the local economies of places like Valley Forge, Charlottesville and Washington when those job opportunities will no longer be available to our local high school and college graduates.
We saw how the nation’s largest financial companies were made vulnerable when, at the start of the Covid-19 pandemic, employees working offshore in India could not even work from home due to intermittent electricity and internet access. Because of Vanguard’s reliance on its native workforce, our clients were spared not only inconvenience but could rest assured that their retirements and investments safe.
In closing, your decision to outsource many of our key functions might seem like a prudent management decision; in the long run, it is not. Companies that outsource/offshore to countries with cheaper labor always experience declines in the quality of their service. I hope you will reconsider this decision.
Imagine if the Vanguard CEO received hundreds of letters just like the above. Or even better, any and every CEO and member of a board of directors receive such letters. Change requires collective action. But effective collective action is in fact tens of thousands working individually in similar fashion to bring about change.
In closing, I’d like to remind everyone to follow us on social media – there’s much happening on a daily basis that can be hard to capture in a weekly newsletter. Be bold, stay strong, and never forget we are all in this together!