I'm having trouble understanding how 1 company paying 1 salary for 1 position makes money for the 8-12 people described in the process above.

One Western salary can be enough to pay for a whole boiler room's worth of salaries in a third-world country.

1 company, taking up multiple positions (5-10) in multiple companies (3-5) as regular full time employees (us salary) and work is spread across lowly paid workers. and its not 8-12 people involved, that would be just 1 position. there would be about 20-50 people in these "smbs"

because the people above are just for the interview.. And they are shared across multiple jobs, so it is not just 1 position..

They apply to multiple jobs at multiple companies..

One team handle interview process to make sure they get the job, once they get the job another set of people handle the actual work.. And then the interview team also handle any instance the person need to be seen or talked to..

Each job pay a few of those guys and the company keep the rest.. If they land enough jobs they can easily pay for all that..

Those people are only for the initial interview.

Also, the purchasing power disparity in different regions is humongous. For what a typical L5 might get paid in Silicon Valley, you can afford a team of 5-10 in India, and India isn’t even ‘low cost’ anymore.

You clearly do not understand how rich Americans are. $10k USD is massive amounts of money in these enabling countries

You assume they care about the people and underestimate the desperation of those employees. This is slave labor and it's what US developers are up against. This is why under Trump we've seen 100k layoffs in Tech this year.

yes, its a regular freelancer project to begin with for all these actors