Business
Commentary: H-1B visas have always been a scam. Trump's changes won't fix the problem
Among the government programs that produce more confusion than benefits, H-1B visas are right up there.
If you’ve been hearing about H-1B visas, it’s probably because President Trump abruptly changed its rules with a proclamation on Sept. 19.
As is typical of Trump’s shoot-from-the-hip policy-making, the proclamation produced an outbreak of fear and chaos, in this case among holders of the visas. That’s because it seemed at first that the administration was imposing a $100,000 fee not only on applicants for the visas, but on current holders reentering the U.S. from abroad, say from home leave or a business trip.
This is a de facto ban, as few organizations will be able to afford it.
— Robert D. Atkinson, Information Technology and Innovation Foundation
Until the White House clarified that the charge would be a one-time fee for new H-1B applications, not charged annually or for renewals or reentry, holders were advised by some employers not to leave the U.S. for the present; those who were caught off-guard overseas scurried to get home by Sunday, when the fee began.
A Sept. 19 Emirates flight from San Francisco to Dubai had to abort its departure to allow several panicky passengers to debark, according to Bloomberg.
The administration’s subsequent assurances have quelled the panic. But the proclamation has created new befuddlements, including over whether it opens the door to illicit dealings between Trump and companies bidding for the visas, and whether it’s even legal.
As my colleagues Queenie Wong and Nilesh Christopher reported, there are concerns that “a selective application of the fee could be a way the White House can reward its friends and punish its detractors.”
Importantly, there’s room to question whether the proclamation will solve long-standing problems with H-1B visas. So let’s take a look at the program’s malodorous history.
H-1B visas were created in 1990, under President George H.W. Bush, to relieve what high-tech companies asserted was a chronic shortage of U.S.-born workers in the STEM fields (science, technology, engineering and math).
The idea was to give highly-skilled foreign workers in “specialty occupations” the right to three years of U.S. residence renewable for a further three years — an opportunity to obtain permanent residency or even citizenship.
After a few rounds of tweaking, the annual cap on new applications was set at 85,000, including 20,000 holders of advanced degrees from U.S. universities. Higher education and nonprofit research institutions are exempt from the cap.
Things didn’t work out as anticipated. U.S. employers came to see the H-1B visas as tools to replace native-born technicians with cheaper foreign workers. Scandalously, some of the American workers were required as conditions of their severance to train the newcomers to do their jobs.
I documented that practice at Southern California Edison in 2015. The giant utility acknowledged that the outsourcing of workers would cost the jobs of 500 technicians who did the work of installing, maintaining and managing Edison’s computer hardware and software for payroll and billing, dispatching and electrical load management.
Essentially, Edison was replacing domestic IT specialists earning $80,000 to $160,000 with workers provided by two India-based outsourcing firms, Tata Consultancy Services and Infosys, which were paying their recruits $65,000 to $71,000. By the time the outsourcing process was complete, Edison said, its IT expenses would fall by about 20%.
“They told us they could replace one of us with three, four, or five Indian personnel and still save money,” one laid-off Edison worker told me at the time, recounting a group meeting with supervisors. “They said, ‘We can get four Indian guys for cheaper than the price of you.’ You could hear a pin drop in the room.”
Then there’s the University of California, which announced in 2016 that it would lay off 49 career IT staffers and eliminate 48 other IT jobs that were vacant or filled by contract employees. The American workers were ordered to train their own replacements, who were employees of the Indian outsourcing firm HCL Technologies.
Although the visa law specified that hiring foreign workers would not harm American workers, “the H-1B program is most definitely harming American workers, harming them badly, and on a large scale,” Ronil Hira of Howard University, an expert in the visa program, told the Senate Judiciary Committee in 2015. “Most of the H-1B program is now being used to import cheaper foreign guestworkers, replacing American workers, and undercutting their wages.”
The high-tech industry’s dirty little secret, I reported, was that the STEM shortage was a myth. The same companies wringing their hands over the supposed dearth of STEM-qualified workers were simultaneously laying them off by the tens of thousands. Indeed, experts in technology employment consistently found that “the supply of graduates is substantially larger than the demand for them in industry,” one told me. Anyway, a significant portion of H-1B recruits weren’t in jobs demanding unique skills, but workaday technicians.
Since 2020, the top employer of H-1B visa holders has been Amazon, with a total of 43,375 workers over that period — followed closely by the Indian outsource companies Infosys and Tata. In the current fiscal year, Amazon reigns, with more than 14,000 H-1B holders, followed by Tata, Microsoft, Meta Platforms, Apple and Google. I asked Amazon why it needs so many foreign workers and what work they do, but didn’t receive a reply.
The Indian outsourcing firms have dominated the H-1B system since at least 2009. For years their role has stoked controversy, in part because their employment practices have come under question.
In court, government prosecutors and civil plaintiffs have alleged that Infosys and Tata were exploiting the guest workers they brought to the U.S. Infosys settled federal fraud charges with a $34-million payment in 2013, the largest penalty in an immigration case at that time. The company denied the allegations.
That same year, Tata settled a class action lawsuit with a $29.8-million payment. The plaintiffs alleged that workers imported by Tata were forced to sign over their federal and state tax refunds to Tata, among other claims. The company didn’t admit wrongdoing.
Over the years, the H-1B program has made for political controversy, though Congress hasn’t taken a firm hand in correcting its issues. Conservatives and progressives alike have found reason to complain that it undermines domestic employment. Near the end of his first term, Trump shut down H-1B issuance entirely, along with some other specialty visa programs, but his initiative was blocked in federal court.
But the program remains enormously popular in the high-tech world, which has long agitated for an expansion. Its fans include Elon Musk, who tweeted in December that “the reason I’m in America along with so many critical people who built SpaceX, Tesla and hundreds of other companies that made America strong is because of H-1B.” He underscored his position with a burst of profanity, but he did promise to “go to war on this issue,” although he acknowledged that some fixing is in order.
That brings us to the issues with Trump’s proclamation. Its shortcomings resemble those that prompted federal Judge Jeffrey S. White of Oakland to overturn Trump’s ban in 2020 in a case brought by the National Assn. of Manufacturers and the U.S. Chamber of Commerce, among others.
White ruled that the authority to change the terms of the visas belonged to Congress, not the president, and that the administration hadn’t evaluated the effect of the ban on the domestic economy, as federal law required. The case was rendered moot when Trump’s ban was reversed by President Biden. I asked the White House if it was concerned that this proclamation could also be blocked in court, but got no reply.
A bigger question concerns the ramifications of the $100,000 fee. “H-1B visa fees of this magnitude will strongly discourage the hiring of the most talented members of the global labor force,” says University of Chicago economist Steven Durlauf. Instead, the policy will create incentives to move high-tech and scientific activity to other countries, effectively offshoring economic activity that should occur in the U.S., he says.
The fee is so high that only the biggest and richest employers will be able to pay it, locking out small start-ups that have tried to use H-1B visas to build their professional teams. The proclamation doesn’t make clear whether universities and research institutions will be exempt from the fee. Even financially well-endowed universities would find it hard to justify paying $100,000 to import a faculty member from abroad.
“This is a de facto ban, as few organizations will be able to afford it,” says Robert Atkinson, president of the Information Technology and Innovation Foundation, a high-tech think tank.
The White House says it intends to replace the current system, a random lottery apportioning available H-1B slots among all applicants, with one favoring applications to fill the highest-paid slots.
The proclamation states that H-1B abuses “present a national security threat by discouraging Americans from pursuing careers in science and technology, risking American leadership in these fields.” Never mind that students considering careers in scientific and technical fields are being profoundly discouraged by Trump’s freezes on research funding across the scientific landscape.
So the bottom line is that, as is usual, Trump’s H-1B policy works at cross-purposes with his other initiatives. For decades, the H-1B program has been ripe for fixing. If only the Trump White House took the time to craft a sensible repair.
A rule intended to prevent rent gouging in the wake of the Eaton and Palisades fires has lapsed in Los Angeles County, possibly exposing some renters to hikes.
The executive order that blocked rent increases was issued by Gov. Gavin Newsom amid the devastating wildfires last year. Under the order, landlords couldn’t increase rents by more than 10% above their prefire levels.
The rule, which was supposed to be temporary and was repeatedly extended, ended Friday after a vote to extend it again failed to garner enough votes. Supervisor Lindsey Horvath, whose district includes Pacific Palisades, sounded the alarm in a motion to extend price protections that failed to pass at the Board of Supervisors’ May 19 meeting.
“These price gouging protections continue to be necessary as construction and rebuilding continue, and as thousands of people remain displaced,” the motion said. “Families which signed short-term leases could face drastic price increases of 50% or more without further price gouging protection.”
Los Angeles County is home to more than 1 million rental properties, though not all of them needed protection from the new rule. There are already stricter rent increase caps for many residences, depending on the location, type and age of the building. Despite the rent control in the region, the people of Los Angeles pay among the highest rents in the country.
It is uncertain whether renters will face rapidly rising rents now that the protection has lapsed. But some real estate experts and policymakers said there was no need for the temporary rule that was part of the governor’s state of emergency.
Supervisors Kathryn Barger, Janice Hahn and Holly Mitchell abstained from voting on the motion to extend the protection, while Supervisors Hilda Solis and Horvath supported it.
“I abstained because I did not see sufficient evidence to justify extending this emergency ordinance, nor did I see evidence to eliminate it entirely,” Hahn said.
Barger’s office said she supported allowing the protections to sunset while waiting to see whether new information emerged.
“Market data already shows countywide rents are only about 2% above pre-emergency levels and rental inventory has grown,” Barger representative Helen E. Chavez Garcia said. “The Supervisor is also mindful of the burden these ongoing protections place on small property owners throughout the county.”
Mitchell did not immediately respond to a request for comment.
There haven’t been steep rent hikes in neighborhoods within three miles of the Palisades fire, according to a Times analysis of data from Zillow, the property listing company.
In ZIP Codes within three miles of the Palisades fire, rent increased 4.8% from December 2024 to April 2025. In areas around the Eaton fire, which destroyed swaths of Altadena, rent jumped 5.2% in the same period.
In L.A. County, ZIP Codes farther from the fires saw only about a 2% increase.
A landlords representative, Jesus Rojas of the Apartment Owners Assn. of Greater Los Angeles, told the supervisors during public comment at the meeting that the county’s rent-gouging rules have “long outlived the emergency they were intended to address” and are now being “wrongfully used to harm thousands of rental housing providers throughout the county.”
“There is no proof that multifamily rental housing providers are hugely increasing rents for impacted homeowners,” Rojas said.
Indeed, there are strong signs that the property market in the Los Angeles area has at last begun to cool.
L.A. metro-area rent prices recently fell to a four-year low, with the median rent slipping to $2,167 in December.
Meanwhile, condominium sales had their slowest start of the year in decades. Condo sales in Los Angeles have plummeted to a 20-year low, with fewer than 2,000 units sold in January and February — the worst start to the year since 2005.
Newsom defended the price-gouging protections shortly after they went into effect.
“In the days following the Los Angeles firestorms, we worked quickly to protect Los Angeles survivors from any form of exploitation,” he said in February 2025. “The state has the tools in place to not only block price gouging during this emergency, but also to prosecute bad actors.”
The Los Angeles County Department of Consumer and Business Affairs said it received more than 2,000 complaints after the fires, alleging that retailers and landlords were taking advantage of people put in hardship by their losses, and sent out more than 2,000 cease-and-desist letters to businesses and landlords for alleged price gouging, said Morine Merritt, who oversees department investigations into consumer and real estate fraud.
“Close to 90% of the complaints that we received involved allegations of rent increases,” Merritt said in an interview. Now that the fire-related protections have expired, existing laws and “regular market conditions determine price increases for goods and services, including rents,” she said.
Crackdowns on fire-related rent gouging have been rare, said Chelsea Kirk of the activist organization the Rent Brigade, which analyzed L.A. County’s rental market in the year after the fires. It reported 18,360 potential examples of price gouging in listings but said that few lawsuits had been filed by authorities so far.
Last week, Rent Brigade announced what it said was the first private civil lawsuit brought by a family that claimed to be rent-gouged in the aftermath of the wildfires. Plaintiffs Randall and Candy Renick, whose Altadena home was damaged, said they were charged nearly three times the maximum permitted rate for nearly 10 months. They seek restitution of $96,000 plus civil penalties and attorneys’ fees.
The rental market has probably stabilized since the fires, Kirk said, but other families may still be “locked into illegal rents” that they agreed to pay when they were in a rush to find housing after they were displaced.
Dear Mr. Pelley:
I meant what I said in my letter last week to the 60 Minutes team: joining 60 Minutes is the honor of my career and I am grateful to be working alongside the people who have contributed to the most important television journalism brand this country has ever produced. While I’m new to 60 Minutes, I’ve devoted my career to investigative journalism and storytelling. I started this job excited to collaborate and to benefit from the wisdom and experience of the 60 Minutes veterans, with you among them. For that reason, one of the first things I did in my new role was call you to talk and invite you to dinner. It is a profound disappointment that you rejected that overture and chose ambush instead. Yesterday, you hijacked my first meeting with staff to disparage me, my qualifications, and my intentions with remarkable incivility and contempt. I welcome a diversity of viewpoints and respectful debate among the team, but this was nothing of the sort. Yesterday’s performative display of hostility enacted in front of the staff instead of in a civil, private conversation-demonstrated that you have no interest in contributing to the future success of the show, or approaching my new tenure with a mind open to collaboration and progress. I am here to deliver first-in-class news programming, not to make headlines about newsroom drama. I am eager to work alongside those who share this goal.
Despite yesterday’s misconduct, I had hoped that in sitting down with you today we could find a path forward together. You made clear that you are not interested in such a path.
Your antipathy to the future of the show has come through loud and clear. And I have heard you. I therefore write on behalf of CBS News, Inc. (“CBS”) to inform you that your employment with CBS is terminated for cause effective immediately. Enclosed is your formal termination letter.
Sincerely,
Nick Bilton
Executive Producer, 60 Minutes
The co-founder of Aspiration, Joseph Sanberg, was sentenced to 14 years in prison on Monday after defrauding investors and lenders of over $248 million.
The startup, an eco-friendly digital banking company boasting fossil fuel-free investments, carbon offsets for gas purchases, and a debit card with cash-back benefits for shopping at clean companies, was founded by Sanberg and Andrei Cherny. Cherny left the company in 2022 and has not been charged.
Sanberg, an Orange County native, pleaded guilty to wire fraud in October after being arrested in March last year. Aspiration subsequently filed for bankruptcy and liquidated all of its assets by July.
Sanberg and venture capitalist Ibrahim AlHusseini, who also faces charges, together forged a series of bank statements in order to obtain loans. From 2020 to 2021, the pair forged AlHusseini’s bank statements to show millions of dollars in assets in order to obtain millions of dollars from lenders.
Additionally, they forged a letter from their audit committee stating that $250 million in funds were available, when in reality Aspiration had less than $1 million. The amount of loans defrauded exceeded $248 million.
In 2021, Sanberg artificially inflated Aspiration’s 2021 revenue by $44 million by recruiting 27 fake customers to sign letters of intent pledging tens of thousands of dollars per month for tree planting services. Sanberg himself funded the contracts and used the inflated revenue numbers to obtain more loans.
The charges sparked an NBA investigation into salary cap allegations due to Aspiration’s connections with Clippers owner Steve Ballmer.
Ballmer personally invested $60 million in Aspiration, all of which was lost. He is now the target of a civil lawsuit alleging his participation in the scheme. Ballmer denies the allegations.
The team announced a $300-million sponsorship deal with Aspiration, and Clippers player Kawhi Leonard signed a four-year, $28-million marketing contract with the company, which reportedly performed no duties. The issue has raised concerns about how players are circumventing the NBA’s salary cap.
The team lost the $300-million sponsorship deal and an additional $20 million paid for carbon offset purchases.
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