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Old 11-14-2016, 07:20 PM
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Default Initial analysis of US Presidential and Congressional elections - 10th Nov 2016

Please find the initial analysis of the US Presidential and Congressional elections focusing on our key issues of concern. The focus of the analysis includes President Elect Trump’s :
Views on India, focus on key topics like immigration including high skilled immigration and H-1B visas along with the important role that Senator Jeff Sessions may play within his scheme of things.
Views on trade and remedy on trade disputes.
Congressional results and key people that we may need to focus upon keeping in mind Republican control of both the House and the Senate.
Outlook for 2017 including focus on nature of immigration reforms and what it may look like.
Outlook for Congressional lame duck session and impact on Omnibus including possible action on some of our key concerns.
Possible Trump cabinet.

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Old 11-14-2016, 07:21 PM
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2016 US Presidential & Congressional Elections – Initial Analysis

United States Presidential Election

After one of the most controversial elections in American history, Donald Trump has been elected

as the 45th President of the United States. In the early morning hours of November 9th, Trump

secured 279 electoral college votes over Hillary Clinton’s 228 electoral college votes. 270 votes

are needed to secure the Presidency. Three states – New Hampshire, Michigan and Arizona –

remain too close to call for either candidate. However, the results of these states will not change

the outcome of the election.

By all accounts, Trump’s victory will go down as one of the most stunning upsets in American

history. Trump never held office before and defied all polls and political pundits after a divisive

campaign against Secretary Clinton and the Republican establishment.

Trump’s election ramifications were significant. Republicans minimized losses in the House and

retained outright control of the Senate (even though they are not close to the 60 seats necessary

to overcome a filibuster). As a result, Republicans will control the White House and both

chambers of Congress in 2017.

Trump and his position on key issues

Trump recently stated that the U.S. and India would be “best friends” if he was elected, and “there

won’t be any relationship more important to us.” With that in mind, it will be important to see if

Trump’s campaign rhetoric regarding immigration, high skilled visas and trade will evolve as he

begins to govern and tries to increase business ties with India.

Based on policy positions detailed during his campaign, we believe a Trump Administration will

initially focus on a range of issues, such as immigration, trade, tax reduction (couched as a jobs

bill), repealing Obamacare, and infrastructure spending.

Here are the various positions Trump has taken on key issues of concern to NASSCOM and

member companies:

 Immigration – Trump has campaigned around three core principles: (1) There must be a

wall across the southern border with Mexico; (2) Current U.S. laws must be enforced

before additional laws are contemplated; and (3) Any immigration plan must improve jobs,

wages and security for all Americans.

Trump has stated repeatedly that the influx of foreign workers holds down salaries, keeps

unemployment high, and makes it difficult for poor and working class Americans to earn a

middle class wage.

With regard to high-skilled visas, Trump has been an outspoken critic of the H-1B visa

program and of the way it is used by the IT services industry in particular. Among many

other things, he said -

We graduate two times more Americans with STEM degrees each year than find

STEM jobs, yet as much as two-thirds of entry-level hiring for IT jobs is accomplished

through the H-1B program. More than half of H-1B visas are issued for the program's

lowest allowable wage level, and more than eighty percent for its bottom two. Raising

the prevailing wage paid to H-1Bs will force companies to give these coveted entry-
level jobs to the existing domestic pool of unemployed native and immigrant workers in

the U.S., instead of flying in cheaper workers from overseas. This will improve the

number of black, Hispanic and female workers in Silicon Valley who have been passed

over in favor of the H-1B program. Mark Zuckerberg’s personal Senator, Marco Rubio,

has a bill to triple H-1Bs that would decimate women and minorities.

Too many visas, like the H-1B, have no requirement to hire American workers first. In

the year 2015, with 92 million Americans outside the workforce and incomes collapsing,
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Old 11-14-2016, 07:22 PM
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we need companies to hire from the domestic pool of unemployed. Petitions for

workers should be mailed to the unemployment office, not USCIS.

In March 2016, Trump offered some support for the high skill visa programs only to clarify

his statement the next day by stating he supports high-skilled visas (for Silicon Valley) but

remains opposed to the H-1B program claiming that the program “is neither high-skilled

nor immigration: these are temporary foreign workers, imported from abroad, for the

explicit purpose of substituting for American workers at lower pay. I will end forever the

use of the H-1B as a cheap labor program.”

Trump has acknowledged that as an employer, he used the H-1B program to hire foreign

workers. While it was a lawful option, Trump has stated that he “shouldn’t be allowed to

use it” and because of this experience, he knows how unfair the program is for American

workers.

It’s also important to note that Trump’s key advisor on immigration issues and one of his

most loyal campaign surrogates was Senator Jeff Sessions. Sessions is a fierce critic of

high skilled immigration and has called for very drastic reductions and new restrictions.

Among other things, Sessions is currently the chairman of the Senate immigration

subcommittee. Sessions was one of the key individuals singled out and thanked by Trump

during his acceptance speech. The expectation is that Session could be rewarded with a

Cabinet position (perhaps Department of Defense or the Department of Homeland
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Old 11-14-2016, 07:22 PM
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Security) or a top White House position, any of which would ensure his strong influence

with President Trump.

 Trade - Trump campaigned heavily on renegotiating trade agreements to better reflect

American interests to preserve and create American jobs, increase American wages and

reduce America’s trade deficit. Trump outlines his plan for trade policy in seven points. (1)

withdraw the United States from the Trans-Pacific Partnership; (2) appoint the toughest

and smartest trade negotiators to fight on behalf of American workers; (3) direct the

secretary of commerce to identify every violation of trade agreements a foreign country is

currently using to harm the American worker and then use every tool under American and

international law to end this harm; (4) renegotiate United States deal in NAFTA to benefit

American workers. If those partners do not agree to renegotiation then, Trump will then

submit under Article 2205 of the NAFTA Agreement that America will withdraw from the

deal; (5) instruct his treasury secretary to label China a currency manipulator; (6) Trump

will instruct the U.S. Trade Representative to bring trade cases against China, both in this

country and at the World Trade Organization. China’s unfair subsidy behavior is prohibited

by the terms of its entrance to the WTO and he intends to enforce those rules and

regulations. He basically intends to enforce the agreements from all countries; and (7) if

China does not stop its illegal activities, Trump will use every lawful presidential power to

remedy trade disputes, including the application of tariffs consistent with Section 201 and

301 of the Trade Act of 1974, and Section 232 of the Trade Expansion Act of 1962.

Congressional Results

Republicans will continue to maintain control of the House of Representatives and the Senate in

the 115th Congress. Like the Presidential race, many political pundits were predicting much closer

contests in both houses of Congress.

In the House of Representatives, Republican’s lost 6 seats and will maintain control with 235

seats versus Democrat’s 191 seats. It’s likely that Paul Ryan (R-WI) will continue as Speaker,

particularly given that he has credited Trump with saving the Republican’s congressional

majorities and has pledged to work with him. Below are a few key races important to NASSCOM:

 Rep. Bera (D-CA): Re-elected with 53%

 Rep. Issa (R-CA): Re-elected with 52%

Reps. Issa and Goodlatte will remain the point people for the Republicans on high skill

immigration. Issa may be inclined to continue with his push to change the exempt wage level and

possibly add in additional ideas given SCE, the criticism of his legislation and now the noise

around layoffs at UCSF. The possibility of Issa and Lofgren working together, though, probably

died when she attacked him and his staff over their work on H-1Bs during the campaign.

In the Senate, Republicans maintain control with 51 seats, with two Senate contests (New

Hampshire and Louisiana) still undecided. It is expected that Senator Grassley will continue as

Senate Judiciary Committee Chairman and Senator Durbin, Sessions, and others will continue to

be active on our issues.

If Sessions gets selected for a senior position in the Administration, Senate Republicans will need

to select a new Chairman of the immigration subcommittee. Committee selections will be made

in early 2017. One viable candidate is Senator Purdue from Georgia. Purdue has been better

than many of his colleagues on high skill immigration and always willing to listen. He has said

positive things about the sector before reversing himself in the very same hearing on high skill

visas. Regardless, the expectation is that Chairman Grassley would still control the activity on

high skill immigration under the full committee’s and its subcommittee’s jurisdiction.

On the Democratic side, Chuck Schumer is expected to be selected by the Senate Democrats as

the Minority Leader. If this happens, he will be replaced as the Ranking Member on the

immigration subcommittee. His likely replacements all have criticized the sector. One possibly is

Diane Feinstein of California who has been critical of the sector previously, is the reason why
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Old 11-14-2016, 07:22 PM
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USTR is prohibited from negotiating on visas, and who could be encouraged by the stories of

layoffs at UCSF to seek new restrictions.

There could also be some key changes at a staff level with some agency detailees leaving their

committee positions and some Republican staffers possibly being tapped for influential positions

dealing with immigration in the Trump Administration.

Outlook for Next Year

Trump’s campaign rhetoric all, but guarantees, that his administration will address border security,

immigration reform and changes to U.S. trade policy in 2017. It is important to remember that bills

currently pending before Congress expire at the end of this session and all bills need to be

reintroduced next year.

The immigration reforms sought will be very different than what we’ve seen in recent years. The

ideas that prevented legislation from advancing related to the undocumented and possibly

providing a potential path to citizenship are off the table. Plus, Republicans control both the White

House and Congress. In a post-election interview, Senate Majority Leader McConnell said that

border security proposals would be one of the first issues addressed. The focus will now be on

border security, enforcement, US worker protections, and prioritizing the foreign nationals that the

governing party feels would most benefit the US. High skill visas and proposals related to the use

of high skill visas by the sector would come under these latter categories.

At this time, all legislation options are on the table to advance to push immigration reform next

year. Depending on the details of the package and Congressional support, we may see

comprehensive legislation or a series of smaller, discrete bills. In either case, the sector should

presume that it will be targeted again next year and that the risk profile for something to move has

likely increased.

Further, while some Republicans have approached immigration reform cautiously out of concern

of a potential backlash from the electorate, the percentage of Latinos that supported Trump

despite all of his harsh rhetoric on immigration could reduce this concern. If so, elected officials

may come to believe that they can stake out harsh positions without suffering consequences on

Election Day (and may even be able to see some gains).

The sector will also need to watch who takes the key positions in the Administration. As noted

earlier in this memo, Jeff Sessions is one potential key player. Others include Rudy Giuliani,

Victoria Lipnic and Arizona’s Maricopa County Sheriff Joe Arpaio, who lost reelection last night.

While Trump will seek legislative reforms, there are many things that he could attempt to do under

the Administration’s unilateral authority as well. These could deal with adjudicatory criteria,

definitions, wage formulas, investigations and enforcement actions and more. It simply is too soon

to have any clear vision on this.

One thing that we can say with certainty is that Trump is unique and that no one can say with any

specificity or certainty exactly what his specific proposals will look like and how his rhetoric may

change when confronted with the realities of Washington.

Outlook for Congressional Lame Duck Session (2016)

The expectation before the election was that Congress and the Administration would work out the

details for a year-long omnibus appropriations act in December. The industry’s concern has been

the small chance that Rep. Issa’s proposal to increase the exempt wage level might be included

and the greater risk that Chairman Grassley’s request to include language making clear that the

50:50 fees must be collected on extensions would be granted. NASSCOM, select companies

and the Government of India have all been pushing back hard to prevent the inclusion of either

provision. The outcome of these efforts are yet to be determined.

The significant possible change in this dynamic is that yesterday’s sweep has given Republican’s

reason to resist agreeing to an omnibus bill that contains policy riders favorable to the Obama

Administration. Instead, Congressional Republicans may simply push for a “clean” Continuing

Resolution that would keep most funding levels consistent and not contain extraneous policy

riders (including those focused on the sector). We will be watching developments on year-end

funding with great interest and will keep you informed of relevant developments.

Possible Trump Cabinet

The Trump campaign has not publically discussed any potential cabinet nominees to date.

Among those individuals currently being mentioned for a Trump Administration are:

● Secretary of State – Newt Gingrich; Sen. Bob Corker; John Bolton

● Attorney General - Chris Christie; Pam Bondi; Rudy Giuliani

● Treasury Secretary - Steven Mnuchin

● Interior Secretary - Forrest Lucas; Robert Grady; Donald Trump, Jr; Sarah Palin; Jan

Brewer; Mary Fallin; Rep. Cynthia Lummis; Harold Hamm
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