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The Full Outsourcing Discussion
GileadGreene writes "Thomas Friedman of the New York Times recently did an interesting Op-Ed piece about the "silver lining of overseas outsourcing": the growth that it generates in the US job market as Indian companies outsource work that US workers are better at. Apparently total exports from US companies to India have grown from $2.5 billion in 1990 to $4.1 billion in 2002 as well. So maybe this outsourcing thing isn't so bad after all." Ultimately, free trade works out well; I think one of the issues is that white collar jobs are just beginning to feel the pinch, and are acting like manufacturers did in the 1970s and 1980s.
Hemos adds: Ultimately, free trade works out well
then I read this in the article:
"look around this office." All the computers are from Compaq. The basic software is from Microsoft. The phones are from Lucent. The air-conditioning is by Carrier, and even the bottled water is by Coke, because when it comes to drinking water in India, people want a trusted brand. On top of all this, Nagarajan said, 90 percent of the shares in 24/7 are owned by U.S. investors.
OK, so that's how Free Trade works out well: domestic workers are put out of jobs but the big multinationals reap the benefits. Where are the phones from Lucent and the the Carrier air conditioners manufacturered? Where does Coke bottle the water? They don't ship it over from the US. They probably have a filtering and bottling plant down the street.
The 90% of the shares owned by US investors aren't owned by your next door neighbours, they're owned by multimillionaire investment traders. They don't give a shit about the people making them the money, they're just cogs in their money-machine.
Saying Free Trade works out well because faceless corporation make billions is just plain wrong.
Trolling is a art,
The idea that America has an advantage in certain areas always comes up. But what jobs are Americans better at when the definition of doing a job well is increasingly based solely on the cost of labor?
sure.. it's good for the fat cats, but when is life not going to be? the points brought up in the article - All the computers are from Compaq. The basic software is from Microsoft. The phones are from Lucent. The air-conditioning is by Carrier, and even the bottled water is by Coke - wherever the offices are in the world these things will be provided by these companies or such like. The only people whose pockets are getting lined are the Fat Cat's, not Joe Geek who just got pushed out of a job.
tim
I think customer satisfaction is a major issue in outsourcing. I remember a friend complaining non-stop about Dell's customer service being incomprehensible after Dell switched to outsourced call centers.
Seriously though, if we continue (to allow our "representatives") export middle and upper-middle class jobs, we WILL see a depression, and I don't mean like the '80s, I mean a real depression. We're more than halfway there already. It's too bad we keep electing politicians that just sit back and allow the corporate wonks to masturbate them.
"Who are in control, they are not in control of anything - they don't even control themselves!" - Glen Beck
Now, could you please answer just one question? We in the US were told when we shipped all our manufacturing jobs, and most of our dirty work, to the Third World, that all would be OK, because we would retrain to do the work of the mind. Which supposedly has a higher value.
Now that all the work of the hands is gone, we are starting to ship the work of the mind elsewhere. When the work of the hands and the work of the mind is gone, what exactly is left?
Please be precise, specific, and complete in your answer. Thanks.
sPh
I'm a little confused by the article... It states that this is a plus for U.S because all of these outsource sites buy Compaq computers, drink Coca Cola, etc. So, are we to believe those same centers here would not?
It seems that $4.1 billion is not quite as much money as is lost by the people in the US not being able to buy things HERE because they dont have jobs. All that money goes directly to the corporations, and their CEOs when they sell any product. Eventually they'll simply start producing the products in the countries they're selling them to. They can make compaq computers in India if they need to.
In the long run, outsourcing will create some jobs, but it will be a fraction of the jobs that we currently have. Sure, people can retrain and new industries will develop, but the rapid loss of jobs puts a damper on the economy, one which can be tough to bounce back from.
The corporations are not worried about this, because they can still export products to other countries. Everyone else will have trouble.
http://github.com/gbook/nidb
All it is is hiring workers who do the job best, without regards to where the worker is. No big deal. There is nothing wrong with hiring the best worker.
How is this insightful? It's just plain incorrect. It has nothing to do with the best worker, otherwise you'd have call-centers filled with highly paid experts.
It's about hiring someone who can still do a decent job and saving money, with a heavy emphasis on saving money.
Casual Games/Downloads
(start -1 Flamebait rant now)
- Manufacturing in the US (save automotives) is all but dead as those get outsourced to other nations where labor is cheaper
- Information management (programming) is outsourced off to India
- Cultural production is stifled and held in the hands of the Hollywood few
- Creativity production is stifled and bound by the overworked USPTO and overbearing DMCA
When the nation is nothing but accountants, lawyers, and doctors, whose primary role is to redistribute, rather than create, wealth, don't go crying when suddenly people realize you add nothing to the table.
(Well, this explains an awful lot of why US laws are like that. When you create woefully little, you must defend that little with all your might. Think: if the US can actually compete despite their higher costs because they add more value, what'd be the point of the tight-fisted IP laws?)
Doing the Right Thing should not be preempted by making a buck.
However, this example also illustrates a very important caveat to this whole situation: the competition can only be productive if there is an equal baseline established. As a country, we have decided that certain qualities are important to us, such as a clean environment, worker's rights, education, health care, etc. These are national policies, enshrined in institutions from the EPA to the FDA, and thus every state is subject to the same requirements. And it is here that the comparison with international Free Trade breaks down. If companies in India are not subject to the same requirements, if they are not required to care about the environment etc., then it is not really free trade. American companies can't ever hope to compete, burdened by costs they can't control. Instead, we merely subsidize a temporary exploitation of a less developed country. Once India and other countries develop to a similar level, they will likely begin to care about more of the same things, and at that point competition can begin to truly flourish without a need for restrictions. But in the mean time, I don't see how true Free Trade can exist without unfairly undermining important values we hold.
That is as BAD a generalization as any one an American makes.
Owing to hundreds of years of immigration, the US is one of the most diverse nations on Earth, despite the effort of the likes of WalMart and McDonalds to homogenize us.
"does the same job" can be a diffuse and difficult thing to measure. Witness the return of Dell support to America - because Indian workers weren't well-rooted in American culture. The same would happen if the tables were turned. Last I heard, American workers were incredibly productive.
As for overpriced, it goes with the cost of living. But that same cost of living sells lots of products for the very same companies that want to outsource. The article says that Indian companies buy US goods, but do Indian consumers? If an American company shifts an American job to India, does it also shift that purchase of its product? Will an Indian consumer base arise as fast as the American consumer base is destroyed?
The living have better things to do than to continue hating the dead.
Free trade does work out well, but the problem is that it does involve both winners and losers, in the short term. The short-term losers know exactly what to blame: free trade. The winners, by and large, are diffused through the entire economy and over the course of many years: they benefit enormously from free trade, but they don't know it.
For centuries, protectionists have traded on this asymmetry. They point to the real, obvious, and acute problems caused by trade, and deny any theoretical 'ivory-tower' benefits because they are in the unknown future. This is the thinking that resulted in the Smoot-Hawley Act in the US, and similar measures throughout the world, contributing to the profound and lasting slump through all of the 1930's.
Today's protectionists, of course, say that they aren't like that, and that they only want to stop 'bad' trade. But what is 'bad' trade? In the end it still boils down to what it has always been: 'bad' trade is trade that adversely impacts politically powerful groups (such as farmers, steelworkers, perhaps now programmers), regardless of the damage such trade restrictions cause to the economy as a whole.
What was true 200 years ago is still true today: protectionism ends up leaving us all poorer.
You bet! Regulations about chemical safety, for instance, (like methyl-iso-cyanate) are completely unnecessary. Just ask the people of Bhopal.
The living have better things to do than to continue hating the dead.
I don't get conservatives. They espouse the merits of capitalism and the free market(one of their few good ideas), yet when it comes to actually breaking down trade barriers to free the market, they do a 180 to bend over for their base --- few of which actually understand capitalism.
A deep unwavering belief is a sure sign you're missing something...
What you are saying is correct, but unless you own enough stock to live off dividends, that doesn't do 90% of the people any good. Who cares if the stock I own is doing great, IF I DON'T HAVE A FRICKIN JOB AND CAN'T PAY MY BILLS............... That is the boat that increasing numbers of Americans find themselves in. It's great if my investment is doing well because all the big multinationals have shipped jobs and manufacturing and accounting overseas, but my investment alone won't provide me a living....
This is a concept the young replublican, right wing, econ-nazis' need to learn to deal with, or as Dlyan said these times will be a changin'
So Long and Thanks for all the Fish.
Drill baby drill - on Mars
It isn't as though the number of manufacturing jobs in the US has shrunk, or real manufacturing wages have fallen, since the 1980s. No, that has not happened at-all.
I don't doubt that free trade will generate a great deal of wealth. The question is - who will get it? In the example of the Coca Cola-brand bottled water sold in the Indian corporate park - how much of that wealth ends up in the hands of white collar workers?
Obviously - those who have power will use it to secure for themselves a share of that wealth. Duh.
This is not even about workers in India and the United States "competing" with eachother.
Let's take an instructive look at the case of caterpillar. Caterpillar (they make tractors) maintains factories both in the United States, and in Germany, and in third world countries. They have, in fact, more factories than they need to build enough tractors to meet demand.
So, when American workers went on strike, they simply increased production in their German (and Mexican, IIRC) factories. The German workers make slightly more than their american counterparts would-have but that doesn't enter into it. With the additional power provided by their international organization, caterpillar was able to break the strike.
So, yes, free trade does generate wealth. But, as with other aspects of trade and commerce (slashdotters are most familiar with the effects of intellectual property law) it will also tend to concentrate existing wealth in the hands of those with the power to take advantage of it.
Pretending, in the case of so-called "free trade" for which ample data is now available, that this is a net benefit for the relatively powerless general population is utterly facetious.
To put it another way - there are all sorts of events, dependent on free trade, might generate wealth for the general population. However, that has no input into the process by which events are made to occur. Events are made to occur because they benefit a particular group of individuals, powerful enough to actualize them. This may or may not have some benefits (lower commodity prices, in this case) for the general population which may or may not outweigh the costs (lower wages, lower employment level) to the general population. Theory can take us this far and from here we should rely on the evidenciary record.
I think it is abundantly clear from the past ten years that the movement of jobs overseas harms the general population more that it benefits the general population.
The good and new comes from no quarter where it is looked for, and is always something different from what is expected.
Look I used to be a tried and true replublican till I saw my friends jobs being outsourced overseas, and the suffering they went through. Then I was laid off and out of work for 9 months ( which is apparently minimal from what some folks have told me), found a new job that pays 20,000 less a year, thats a pinch, being out of work for 2+ years and having to take an $9.00 job is a punch. Basically Bush and the Fox-News crowd don't care, they have thier millions and could care less if the rest of us starve.
Then in the name of religion, they use issues like Gays, abortion, prayer in public schools... ( all issues they have used since Reagan and done extactly nothing about in the last 20 yrs) to suck in the voters from the religious right, that they would otherwise never get, to vote for them and continue looting the US, and throw the evangelicals a bone every now and then.
I have had enough, I plan to use the Reagan formula 'Are you better off than you were 4 years ago???' No, bye bye Repubs... it's that easy.
I don't care if there is Gay marrige, cats and dogs living together, whatever as long as I can provide for my family. Thats the bottom line, the rest of it is window dressing.
So Long and Thanks for all the Fish.
I read Tom's comments on how he saw Pepsi and other companies expanding into South Asian markets and I think he missed at least one important point. How can he compare Pepsi's (and other low-tech companies and functions) expansion into South Asia to technology jobs outsourcing? It seems a little under-educated. Here's what I mean.
For Pepsi to move into India probably required the construction of new manufacturing and distribution facilities. Production continued in Pepsi's traditional markets and probably had little impact on peoples jobs in places such as the US. There was probably little or no job "outsourcing" required to add carmel coloring and sugar to filtered water and CO2. Pepsi's overall headcount probably increased and the net effect on the US economy was job stability (unless or until the colored fizzy sugar water is imported from overseas).
Now let's take a look at our favorite industry, computer technology. IBM, Microsoft, HP, Motorola, municipal governments, and many other groups are moving (notice I did not say expanding) jobs to India. The jobs here in the US are replaced by (perhaps several) jobs in South Asia. The net effect on the US economy is job loss.
I think this gets to the nub of why Tom is wrong. Just like with textile, steel, glass, and automobile manufacturing, jobs lost to overseas labor remain jobs lost. BushCo likes to talk about the "freeing up" of the US economy to "do other things". Nice theory. In practice the gap between the have's and the have-not's (investors/boardmembers/managers and labor) in this country is ever widening.
We keep talking about how a crisis came in the 1970s and 1980s as manufacturing jobs were destroyed in the United States, as if it were in the past tense.
r oit
But, last time I checked, all the previous centers of manufacturing that were once booming cities are still teetering impoverished ghost towns.
A small list of the casualties of the last big free trade expansion:
Akron
Boston
Buffalo
Chicago
Cleveland
Det
Erie
New York City
Philadelphia
Shall we add to the list these IT cities?
Austin
San Diego
Phoenix
Redmond
Maybe we should just trash all of our cities?
This is my sig.
Think about it. If the entire employment of the US is outsourced (other than politicians, lawyers, doctors, nurses, hair dressers, and food preparation workers), there isn't going to be much of a market for stocks among the peons.
Yes, do as you say _think_ about it! But try to take it a step further. The scenario you've described is not that likely to happen, for a simple reason and that is: India won't be cheap forever! The Indian programmers will eventually start demanding better healthcare, education for the kids etc. Whether they pay for it themselves or the government taxes their income more does not really matter. The point is that it will evolve in some stable state, where the Indians will be as expensive as Americans. Want an example: Check out what's happening in Eastern Europe skilled workforce used to be dirt cheap there and is still probably cheaper than most Europe and e.g. in Prague the difference is becoming rather negligible.
Of course this might involve loss of income in America. But given the current situation, where couple of hundred million Americans consume rather bug share of worlds wealth, now that can't last forever can it?
The problem you're facing is to decide between being selfish and saying "all high paid jobs belong to us". Or being reasonable and saying, well acually the Indians deserve their share as well. Look up older Slashdot coverage of the topic to see that they're not working in sweatshops and that it's the Indians who benefit in the first place.
Of course you can resort to protectionism like you have with US and EU agricultural industry. Thirld world farmers can't export their cheap goods, because ours are far too subsidised. Furthermore EU and US dumps their produce in their market, below the production value, thus driving locals out of bussiness. See http://kickaas.typepad.com/ to get an idea of the outcome of protectionism.
If you really are old enough to have remembered Goldwater, then you're old enough to have heard these tired arguments every five years every time ANY industry goes overseas. You're also old enough to (supposedly) have some historical context on this. Will all jobs go overseas? Well, over 50 years, almost ALL tech jobs will. I guarantee it. Hell, all the "tech" jobs from 1950 have. Is there anything wrong with that? No, because they're replaced by whatever becomes high tech.
Looked at another way, if the US maintains a static labor market, we will become irrelevant and reduced to 2nd-world status quickly. Would you want to have the same sort of jobs available to Americans now that existed 50 years ago? Of course not, because bolt-turning jobs don't pay well, because anyone in the world can do that now. Unless the US keeps innovating, there's nothing to sustain the high salaries commanded by US labor. Unfortunately, we haven't figured out a totally painless way of getting rid of jobs that become less-needed as we innovate, but getting rid of certain jobs has to happen. Don't worry, assuming the US economy stays healthy over the long term, they WILL be replaced. This has occurred in a healthy manner for 100 years. Note that the total loss of manufacturing jobs that has occurred over the last 50 years has had NO ill effect upon the US economy or unemployment. Do you have any reason to suspect this one is different as you claim? Or is it just because the white collar nature of these jobs hits too close to home?
Face it, this isn't a liberal/conservative issue anyway. The US is staring at its onrushing demise just like the USSR was a few years ago. In both cases it will be due to corruption and selfishness.
That's too ridiculous to even be speculative. The USSR collapsed because its centralized economy fundamentally didn't work, and because Reagan tricked them into a military spending spree - which gave us a bunch of debt but killed them. Put it this way - if you're so certain, how about a rough year for the US's USSR-style demise?
The Cato Institute thinks the following:
"The large majority of America's nonfarm workers, about 85 percent, are employed in service-providing industries, construction, and government--sectors where import competition is minimal. To those workers, imports are an unambiguous blessing that spurs innovation, expands consumer choice, and raises real wages." Full Paper Here
Moreover, this breifing goes on to argue employment grows in proportion to imports . There's a fairly rational reason for this, if we can all stop foaming at the mouth long enough to actually think rationally: when employment grows we (consumers) have more cash to spend on goods and services. Since imports are a relatively fixed percentage of the overall economy, whenever the overall economy grows, so must imports. Why am I discussing imports if the argument is over services? Well, services are imported and exported just like goods. So, let's understand the real numbers, here:
The United States had a $64.8 billion trade (BEG ITAL) surplus in services in 2002, despite economic stagnation in Europe and Japan. Services accounted for 30 percent of all U.S. exports and 43 percent ($3.1 billion) of U.S. exports to India. Full Article Here
But, if half of our exports to India are in the form of services why are so many technical jobs going to India? Actually, there's no real evidence that's happening at all. There are two basic erroneous arguments made by the media today supporting the assumptions in this question. First, is the post hoc mistake: because the US economy is losing jobs and because after that happened India started gaining technology jobs, then India must be responsible for losses in American technology jobs. Actually, poor investments by venture capitalists and fund managers caused the loss in US jobs. The fact those losses occured coincidentally with India's technology boom is completely irrelevant.
Second, is the hasty generalization mistake: Bob Smith has just lost his job because his company opened a software development office in India, therefore all American technology jobs must be moving overseas. There just isn't enough evidence to support the generalization made by reporters. We may suspect that India is taking some portion of American jobs, but news reports by well-intentioned NPR and New York Times reporters aren't evidence that its hurting our economy.
All this panic and paranoia about jobs moving overseas doesn't even make sense when we consider the real economics of it. The "entire employment of the US" can't possibly be outsourced. Even if your argument wasn't a textbook example of the slippery slope fallacy, you'd still be wrong on an economic basis. If the USA loses a sufficient number of jobs, i.e. unemployment rises, the consumers will have less capital with which to buy foreign-made products. Domestic workers who are out of work will be willing to work for less, thus driving down the cost of locally made goods. When the cost of local goods and services drops below the cost of foreign made goods and services, then jobs will start to flow back into the USA. Adam Smith's invisible hand at work.
During the Clinton Administration monetary policy for the dollar kept our currency strong, which helped keep prices for foreign made consumer goods low. This was a good thing during that time because Asia and Europe were both in the midst of deep recessions and American consumer spending helped to bolster those economies through that trying time. The Bush Administration has since let the US Dollar sag in relation to other currencies. This has helped decrease the price of American goods and services abroad
"He wrested the world's whereabouts from the heavens And locked the secret in a pocketwatch." - Dava Sobel
India is already starting to hemmorage jobs to China and Malaysia, which are cheaper.
Any way you cut it, the data all point to a race to the bottom.
Finding God in a Dog
"our unemployment rate has been dropping steadily for the la[s]t 8 months"
1) That statistic offers no insight into how many former professionals or blue collar workers with good paying industrial jobs are now flipping burgers, cleaning rest rooms, or operating cash registers, having already forfeited their homes. Hey, a job is a job, right?
2) That statistic does not count those who are no longer interacting with the unemployment department because their benefits have run out, and they have despaired of ever finding suitable jobs again.
He says that indian companies are buying computers and that this is a net gain of sales.
However, if the call center was in the US, the US company handling it would still have to buy computers, software, drinks, etc. I don't see how an Indian company buying these instead of an American company really makes any difference to the bottom line of the selling companies. He is claiming that these sales would not have been made, but the call center would HAVE to buy what it needs to run no matter if it's American or Indian. So his entire basic premise seems to be wrong.
Evan Reynolds evanthx@hotmail.com
Two peanuts crossed the street. One was assaulted.
Here's a hint, look under Employment Situation:
Jan 94: 121,971,000 employed. 65,286,000 not in workforce.
Jan 04: 138,566,000 employed. 75,298,000 not in workforce.
"Liberal cry-baby" ad hominem aside, it is of course the ratio of these numbers that we are interested in, not the absolute figures. By your measure, China and India have the strongest employment figures, because they have hundreds of millions more people working! The drop between the '94 and '04 figures you quote is a few tenths of a percent. No impending doom, to be sure, but hardly cause for celebration, or triumphalist chest-beating, come to that.
While there are significantly more people not in the workforce, I submit to you that most of those are retired! (baby boomers getting older, that sort of thing)
While that's partly true, most of the uptake in the "not in workforce" category is due to the increasing number of folks who are unemployed and have given up looking for work. Actually, this is discussed explicitly in the text of the report whose numbers you cite, so I presume you have read it. Anyone who had not actively looked for employment in the four weeks preceding the survey were counted as out of the workforce, but no longer considered technically unemployed either...
This is a concept the young liberalcrat, left wing, econ-morons need to deal with, or they'll get left behind
That's not much of an argument.
Mouser
Assume the following:
If one aims at a bruto salary of $60000 year, that's 60000 / 0.6 = $1000000 (1 Million bucks )
If the taxes are the same on income and over selling of shares, it results in the same netto income.
So, you have to be a millionair already in order to earn from you stock portfolio the equivalent to a $60000 year salary.
And that's not even taking the higher risk in the stock portfolio into account (let's just say that you would party during half of the 90s and starve during half of the 00s)
I do agree that standards of working conditions should be part of any trade deal though.
Drill baby drill - on Mars
"Are you going to bellyache about it and hope your low-grade tech skills will somehow merit $80k again? Or are you going to find those spaces where outsourcing won't or can't go and pursue ruthlessly?"
Could you please repeat that about low-grade tech skills to all of my recently laid-off friends with Masters of CompSci degrees and patents pending? The statistics have shown for years that a PhD would price you out of the market. These people are as highly educated as the market will bear.
My team has to fight every week from getting Architecture and System Design from going to India. We're the cream of the crop on this project and management will only pay lip service about how some customers will want Architecture and Design to stay onshore. The reality is that every project where the customer does not make this demand, everything but QA and Business Analysis (both entry level jobs) will be offshored. Quality be damned. You can afford mistakes when they cost 20% as much. Expect another Dot Boom-Bust cycle in India due to the capital flowing in at such a high-rate.
I'm seeing this now. It is fact, there is no part of IT that is safe. There is no white collar job that is safe. No level of education or productivity is going to save your job. As for persuing these new growth markets, where the fuck are they? There are no margins anywhere anymore. The international free trade has made the system way too efficient. We've tweaked the engine as much as we can and it's running pretty hot.
If there were areas that needed efficiency added, those areas would have good margins. Where are the good margins? If you own a patent (pharmi, software, chemical) you can make good margins on your patent. If you have a copyright on popular work (TW, RIAA members, Disney, Fox, Viacom) you can make a margin on that. If you have a government mandated industry (auto/home/health insurance) you can make a margin. If you do gov contracting (esp Defense) you can make a 20% margin.
Retail electronics (consumer audio/video) are losing margins b/c of convergence and compitition from PC makers. The Economist had an article about Retail Banks overextending their risk in order to get better returns and worrying a lot of analyists in the meantime. Financial services in general are getting squeezed due to the Internet, now everyone has near-perfect information in real-time. I could go on all day listing industries whose margins have dried up in the past 15 years. Due to the lack of standardized environmental and labor regulations in most of the world, it's a free for all race to the bottom. World standards of living will not rise fast enough for this to stabilize for at least another 100 years. The US is only trying to employ about 210 million people out of 300 mil. The world needs to educate and employ about 3.5 billion people out of 6 billion.
The only solution is a legal structure that promotes fair trade so that societies can adjust to the new circumstances brought about by increased trade. This includes the US. The main street of the American economy has gone from a dirt road to an 8 lane highway, we need some traffic lights.
Those that decry regulation talk about how everything will equal out in the long run and that the opposition are just chiken littles have their head in the sand. My favorite quote from Keynes is "The market can remain irrational longer than you can remain solvent". We need the middle class to remain solvent long enough, so we can capitalize most efficiently on the new economic structure that will come out of this new trade.
We are not going to be able to magically create growth and innovation by handing the rich bigger bags of money. They'll invest it in what is safe, we should be subsidizing minimum amounts of manufacturing and tech work for national security reasons, while also creating a more progressive income and capital gains tax system. Bush's tax cuts, due to lack of Fed funding have caused sales tax to go up 30%, on average, nationally. Sales tax is regressive,
Arrogance is Confidence which lacks integrity. -- me
> The scenario you've described is not that likely to happen, for a simple reason and that is: India won't be cheap forever! The Indian programmers will eventually start demanding better healthcare, education for the kids etc.
Yes, but India may well be cheap for a very long time. And then there's China. The point is that the potential pool of underemployed labor in the 3rd world is huge,. This pain's going to go on for quite some time before any equilibrium is reached.
>The problem you're facing is to decide between being selfish and saying "all high paid jobs belong to us".
Who said those jobs are "high paid"? Maybe they were reasonably high paid in the US, but these jobs are going to India specifically because they are not high paid there. Just because they're better for Indians than the alternatives doesn't make them high paid. And if Indian pay gets too high, that's when the jobs go to China.
It would seem reasonable to at least attempt to establish a minimum global standard of living to mitigate the race to the bottom. Otherwise, outsourcing becomes slave labor by another name (no health benefits, no job security, no wage leverage). How much difference does it make that the slaves' choices are so limited that they are willing slaves.
Posted from my Android phone. Oh, I can change this? There, that's better...
People are always threatened by free trade, since the benefits are diffuse, but the pain concentrated.
So, here's a thought experiment:
Explain why you think outsourcing to India is bad, or evil, or should be illegal.
And then explain why the same isn't true of outsourcing to say, South Carolina.
South Carolina has lower environmental and labor standards that the rest of the us. Lower wages.
You really want every state to make their own cars? Furniture? Grow their own oranges? Wouldn't that make more jobs everywhere.
In fact, couldn't we cure suburban blight by preventing cities from importing products from their suburbs?
Now, how is that a better alternative?
And how's that meaningfully different than what's happening in India.
And yes, I am a liberal Democrat who works in the technology industry. The job that might get exported is my own. But I've also worked on a job where engineering was in India, and product management was in the US. That particular product was something that wouldn't have been worth doing at US labor rates. In many cases, this isn't a matter of exporting jobs, but creating jobs that didn't exist before, or couldn't have had as much labor behind them.
Another way to think of it: How much extra are you willing to spend on products in order to have them done in the USA. Are you willing to have your support contracts 4x higher to have an American answer them. Are you willing to pay 4x more for clothes? $400 Nikes?
Me neither.
Moreso, I'd rather have Africa get richer exporting food, Pakistan richer exporting clothes, and then get to pay even less for those goods. Ever wonder how much each of us is paying in tax dollars per American farmer?
Note that, if your income stays still, and you pay twice as much for everything, you just had a 50% pay cut. Anyone think outsourcing would get as bad as that? Nope.
As David Ricardo proved a couple of centuries ago, the strongest economy is one where everyone does what they're best at. Trying to pick winners and losers just drags everyone down.
The problem with our economy today isn't outsourcing and free trade. It's the most bolluxed up, politicized, fundamentally ignorant economics team in the history of the country. I would have been hard pressed to find a way to have spent MORE money with LESS economic stimulus than the the Bush economic "plan."
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