What Should a Documentary Filmmaker Ask About Offshoring?

Philadelphia-area development economics and finance student Rachel Anderika and her associate, programmer/filmmaker Krishnan, are making a documentary about the effects of offshore outsourcing. Their "still under construction" Web site, Project Outsourced, gives you more information about their work. They're interviewing economists, bankers, anti-outsourcing advocacy groups, pro-outsourcing CEOs, columnists, and others. Where you come in is helping Rachel and Krishnan come up with good questions to ask. We'll forward 10 - 15 of the highest-moderated ones posted here (within the next 24 hours) to them. Expect summaries (and possibly audio or video clips) of the answers in late May, and news about the finished film this Fall.

Comments

What field next

[onyxruby]

The one question I have never been able to get a straight answer on. What field should the millions of displaced American IT workers get trained in?

It is always sais that people should be responsbile and learn new skills and train in a new field. When the farm economy shifted to manufacturing, people learned factory work. When manufacturing started to be offshored people were advised to get into IT. What field should people start to train in? Bush talks about training displaced workers, but I haven't heard anything about what their supposed to train in. What is the next new economy, retail?

Re:What field next

[cluckshot]

The parent here is a fool lost in the smokescreen the "Outsourcing" crowd puts out. Nurses don't earn that kind of money in the first place except in extremely high priced regions like San Francisco. Second the industry is outsourcing. You see I am an RN who left the profession because of outsourcing and the criminally bad management of the industry. I retrained as Software Engineer.

The "Shortage" of Nurses is entirely smoke and mirrors put out to justify what currently is UNLIMITED H-2 visas being issued by the BICS for NURSES. They even took 3 years as work in any medical field as equal to 1 year of College for RN. Thus you could have someone soon caring for you who knows nothing about nursing except cleaning beds. But Ignorant fools like the parent of this post will not learn until it is they themselves who get no care or are hurt. By then they will be too weak and too broke to be able to fuss.

I personally watched in Nashville Tn while the heads of Columbia HCA were arrested for RICO Violations in a "No Knock Raid" on their HQ near Centennial Park. I have seen their actions first hand and know how illegal they are. The claims of Nursing Shortages and High Wages are put out by people those kind of people.

Re:What field next

[seichert]

Anecdote : I know one guy, at my local gun club, who lost his job to 2 people in India and 1 in Mexico. It was literally cheaper to hire 3 people than to keep paying him to do this particular IT job. He had a life long interest in automotive electrical systems and decided to pursue a 2 year degree from a local community college. His reasoning : 1) You can't outsource car repair to India, 2) There is high demand for a person with skills in this area, 3) He really loves doing it. I also read another article recently about demand for automotive technicians being quite high and supply being quite low. The article suggested that this situation was the result of a generation of parents not wanting their kids to grow up to become "grease monkeys". These parents did not realize that automotive technicians are really computer technicians (as most modern vehicles are computer controlled) and can earn a comparable salary to an I/T person. There are many great good paying careers outside of I/T. If you think that your days as an I/T person are over then it would be worth it to look around.

Re:What field next

[cluckshot]

The most rational set of questions to ask start with the most imporant ones to Investors.

[1] How many dollars of dividends has your company been able to pay to their shareholders as a result of "Outsourcing?"

[2] How much has your compensation risen including all factors since you began "Outsourcing?"

[3] How many dollars of payroll did you save as a result of "Outsourcing?" Be sure to include any Executive Raises as countervailing factors.

[4] Have you had any of your Intellectual Capital Stolen as a result of "Outsourcing." This is probably the biggest and worst part but it never gets talk.

[5] What Liability does my company incurr if data handled in "Outsourced" facilities is diverted to ILLEGAL Purposes such as Identity theft?

[6] What legal devices do we have to deal with employees who misuse data we "Outsource" the processing and service of.

[7] If the data or programming serviced is "Outsourced" what does it do to National Security. This is a common problem with Defense Contractors now. Most outsourcing functionally becomes Industrial Spying for the company Hired to service in the other country.

[8] Does outsourcing this service cause the development of competition which may destroy the operation?

After the issues of Company profitablity are discussed then get down to the other issues.

[1] Are you Receiving assistance to be in business from State or Local Governments such as Industrial Development Bonds etc?

[2] Do you meet the US EEOC requirements in the employement of all of the Outsourced employees? (Age Sex etc discrimination) Most Outsourcing actually is a masquerade for some form of racism or sexism.

[3] Do you deal with the US Government directly or as a subcontractor? If so how do you expect the government to be able to pay your contract if everyone avoids paying US Taxes by "Outsourcing"?

[4] Do you expect the United States Government to protect your operations using if need be Military Forces to make sure your trade is safe? If so how do you expect to have it paid for when you avoid paying the taxes which support it by "Outsourcing?"

[5] Can you point to any nation which has benefitted by lowering wages and reducing its standard of living?

[6] Do you like trading in the lucrative market in the USA? If so how do you think that it will remain lucrative with you and others "Outsourcing."

[7] Are you as an American Incorporated Company benefiting by US Laws, Currency and infrastructure? If so how do you expect this to be maintained if you continue "Outsourcing."

Then you can come down to the issues such as the effects on Citizens generally. These include:

[1] Do you believe that United States Citizens have any rights in their own land that arise from Citizenship? If so what are they? If so how do your actions affect these rights?

[2] What value do you believe should be placed on loyalty to your fellow countrymen?

[3] How important is the USA to world safety and prosperity with regards to the cost of lives and treasure from US Taxpayers taken to pay for these actions and conditions?

The whole set of issues here address the matter indirectly but they completely attack the reasoning behind the "Outsourcing" game.

Do overseas workers cause more problems than...

[Xystance]

Very simply, do overseas workers cause more problems than they create? When it comes to programming, coordinating projects between two centers in different facilities in a single country is hard enough. Adding culture and language differences to the mix while not being able to have direct and on-site meetings to architect a complex program, is that a recipe for disaster? With overseas call centers, do you keep enough future customers due to deficiencies in customer support to make it financially viable to continue offshoring support? How do you cooordinate high-level management objectives with an office across the world?

I will probably lose karma for this

[realdpk]

(but who cares)

My question is .. has the standard of living, for those working for American companies, increased at all? Or are the jobs just barely paying the bills like any other job might?

Economy..

[DarkBlackFox]

Is outsourcing seen in the public eye as helping or destroying an economy? I mean, on the one hand, we're loosing jobs locally, but on the other hand it's creating thousands of jobs in 3rd world countries. I heard someone say before every one job here is worth three jobs offshore, for the same amount of money. I guess the question is, are companies benefiting by getting more bang for the buck out of employees helping the economy locally, if not the job market, while at the same time helping the economies of other countries by creating jobs? A penny saved is a penny earned, potentially spent locally.

Effect on the economy?

[neurojab]

What effect do you feel the outsourcing of professional jobs has on the economy? When manufacturing moves offshore, it's easy to say we'll all be employed with "knowledge jobs", but what happens when the knowledge jobs move offshore? Doesn't this equate to leaving our own highly skilled individuals unemployed/underemployed while we're pumping money into a foriegn economy via payroll? If we oursource our professional jobs, where will stateside consumers get the money to purchase the (now cheaper?) products? Is a "service only" economic model sustainable for the United States?

Local effects

[Elwood P Dowd]

What are the positive and negative effects on the offshore locations?

Are these positive and negative effects distributing themselves evenly through these societies, or is it effecting and effected by existing class and social structures?

I have two actually...

[Maestro4k]

The first one I hope they're planning on asking the appropriate person(s) already.

1. What effect has losing a job to out-sourcing had on you personally, including all aspects -- mental, physical, financially, etc. (This one obviously needs to be asked to someone (or many someones) who have lost a job because it got outsourced.
2. Who is supposed to pay for tech workers retraining themselves in new fields? I see so many companies/organizations saying that US tech workers even enjoy retraining for new fields, but they never mention how a newly unemployed (thanks to outsourcing) person is supposed to PAY for that retraining.

Personally I would LOVE to see the people who go on about US tech workers just need to retrain for a new field asked #2. I doubt you'll find many (if any) that will answer on the record though.

Is the fiscal argument real?

[delcielo]

To the CEOs of the outsourcing companies:

Is the outsourcing really cheaper when the total costs are figured, or is this move a way to show shareholders that you're doing some cutting in the down economy?

Two Questions - one from each "side"?

[prestidigital]

1. What are the hidden costs associated with offshore outsourcing? We hear a lot about drastically lower labor costs. But there are also costs associated with cultural and geographic distance, lack of interpersonal interaction, and trust issues, and more. These should be balanced against labor cost savings. So what are these costs and how much impact do they have?
2. Is it really "offshore outsourcing" when the company that gets the job is a global company with offices and personnel located in the U.S.? Even jobs that are awarded to U.S. companies often involve the use of offsite workers located in or shipped in from other states. How much difference does it really make to an in-state worker who loses his job to an out-of-state worker compared to an out-of-country worker?

How is it different than Robotics?

[PseudononymousCoward]

Ok, so lets say I have a piece of software on the computer sitting under my desk that automagically writes programs. I write detailed design specs, then run a shell script, say ./program.sh . A week or two later, I have a written program. Would anybody object to the creation of such a program? No, of course not.

But if, instead of DELL writing programs, it's 5 guys in Bangalore, and my computer simply acts as a communications point, then suddenly we're getting out the pitchforks and torches? Why the difference? I ask my Economics classes this every course, and I've yet to hear a reasonable answer...it all comes back to "but those are PEOPLE", as if them being Intels, or AMDs, or chickens would make it more acceptable.

Remember the scare about robots in the 1980's? Remember the chicken littles running around warning of the disappearance of jobs in America, as we were all replaced by robots? It's happening again.

PC.

And what about NEXT quarter?

[BadDoggie]

Most outsourcing is done through intermediaries and the outsourced workers themselevs are classified as "contractors". These people realise the disposable nature of their positions and are themselves worried about their jobs disappearing to even cheaper countries such as the Philippines. There is no job security and no loyalty to the company. There is no incentive to work harder or find ways to help the company. There is only the desire to get as much out of the employer as possible, in the shortest time possible, and to find a new employer while still being paid by the old one.

Considering this, can the short-term financial gains really offset the long-term benefits a loyal and motivated workforce provide?

Re:Practice of outsourcing (not a question)

[DAldredge]

A large portion of the cars made at the Honda plants in the USA are made for the US Market. Also, it is/was due to Reagans tarrifs that they located here in the first place.

There is a difference between having a factory in an other country to serve that country and exporting most/all of that factories output to the USA.

Hell, it can't continue much longer due to how our income tax system is setup. If you make less than a certin amount you pay NO income tax, and most of the new 'service' jobs pay less than that amount.

What KIND of jobs?

[rburgess3]

The question I would like most answered is this:

Yes, IT jobs seem to be outsourced to foriegn countries, but specifically what sectors of IT, and for what purpose? Not for what gain, as that is fairly obvious - saving money - but what is the function that these outsourced jobs fill? For call centers, this is fairly obvious, but what about for programming? What kind of programming is being done off-shore? What kind of programming cannot for saftey reasons, intellectual property reasons and other reasons be moved out of the US?

Similarly for other sectors of the IT field - what are the limits, and why?

Real Reasons?

[ChuckDivine]

I'm on record for saying that working 100, 80, even 60 hours per week regularly is dysfunctional and counterproductive. There are other management fads that are likewise dysfunctional and counterproductive.

To what extent is outsourcing being driven by staff resistance to management demands? What kinds of demands are being resisted?

This question can be put to both the pro and anti sides.

Is it worth customer irritation?

[somethinghollow]

I recently had the task of setting up a printer to work with Quark Xpress. They offer no free support. My employer paid the support cost, and I was put on the phone with a man with a thick Indian accent. It was so bad that I had to ask him to repeat himself at least once every time he spoke. I guess my argument is that people hired to interface with other people should be able to communicate well. It was such a pain in the ass to translate his accent that I decided I would avoid purchasing Quark or recomending Quark (ignoring that some alternatives may be better products). I've heard that Dell computers heard similar complaints to the ones I am making, and brought their tech support back.

I guess my question is: Is it worth the savings to piss your customers off, esp. when they are paying top dollar for good tech support on a per-call basis? On another front, Have these companies had good results overcoming the language barriar (that, according to a programmer friend of mine, ends up causing more problems for a project, resulting in more time cleaning up the mess that misunderstanding brings than executing the project)?

Supply and Demand, indigenous development

[danharan]

Apparently rates in India are going up with demand, which is entirely logical from a market perspective.

If instead of reducing outsourcing we tried to send more work to India, is it conceivable that we could bring up their salaries to a point where they would no longer compete on price?

Also, can we expect some of those Indian programmers and companies to do more work on fulfilling their own software needs, and stop chasing outsourcing work?

I applaud your objectivity and your humility

[unassimilatible]

Unlike Lou Dobbs, who has made outsourcing his nightly crusade, and who shouts down anyone who disagress, you seem to want to approach this with some intellectual honesty, rather than an agenda.

I also like the fact that you don't claim to have all the answers in advance. So many reporters and filmakers are too arrogant to ask for assistance. A truly awesome idea to ask everyone you can about this before filming. Nothing pisses me off more than some 60 Minutes piece that (invariably) fails to interview the other side.

Agenda-based "reporters" rarely find the truth. You might find that outsourcing is terrible, but you appear to be objective and thorough, i.e., the opposite of Michael Moore.

My golden question: Ask the labor unions to explain how they can reconcile their push for high wages and benefits which are completely non-competitive with foreign workers, and then have the audacity to complain about outsourcing, rather than take some of the blame (how's that for a leading question?).

I'd also ask the managers of large pension and mutual funds how outsourcing affects their stockholders, and ask them to describe who, exactly, those stockholders are. The answer might surprise most people.

Good luck!

Spread of US Culture?

[Mongoose Disciple]

Something I've been curious about...

I've read in stories about call centers / tech support outsourced to other countries that the employees are often coached on how to pass as Americans.

They work on their accents to appear more American, learn about American sports teams and pop culture in order to be able to make smalltalk about it and appear authentically American, etc.

I'm curious to know the effects this has locally and what the opinions of it are. Do any of the employees have problems with this deceptive practice? Do they feel that it's making some kind of statement about the (theoretical) superiority of American culture that they're forced to learn about it and utilize their knowledge of it instead of that of the culture they grew up with? Are there ever, for example, new baseball fans created by an offshore call center worker's exposure to the sport for his/her job, or is this almost always purely business for them? Does this happen in other industries? Do more traditional members of the local societies object to the poisoning of their children with this American culture?

I think there are a lot of interesting questions to be asked there. It's not involved in any way with the causes or primary effects of outsourcing, but from the perspective of social psychology alone the answers should be fascinating.

What is the government's obligation to citizens

[pileated]

There are a number of perspectives anyone can take on all of this, some purely economic, more purely political and all sorts of odd mixtures.

The one I'm most interested in is this: what obligation does the government have to its citizens? Should it do whatever it can to facilitate profits for businesses? Should it do whatever it can to maintain/attain a high standard of living for all its citizens. Most communities form out of self-interest. They gain more by being together than apart, and often hard compromises are necessary where individuals must give up something for the common good that they've agreed to support. My feeling is that citizens, government and business have all lost any sense of this commonality of interest. So the first question I would ask is: who gains by offshoring and is that gain for the common good or for a specialized good. My feeling is that it's really for a specialized good, large corporations, but I may be wrong. But I do think this is the most important question to ask.

Debt to Employees

[Perl-Pusher]

I would like to know why when employees put 10+ years into a company, and through those employees efforts and creativity the company has prospered, that the company feels no debt to them? And does a company feel like it can despose of them like yesterdays garbage so that the CEO can get a big fat salary?

How can a nation exist with only management?

[gr8_phk]

I've heard MBA students spouting something about how all the "work" will be outsourced and people in the US will just "manage" everything. I fail to see how this is a viable model for a country. The foreigners will learn management too, and then those US managers that don't know anything about day to day operations in Singapore will be next to go. How can anyone claim a nation of upper managers is viable with a straight face?

Real Question

[Anonymous Coward]

They should comment on the so called "cost of living advantage:"

Q1: If the severe oppression underlying working conditions for the vast majority of Indians was removed, would outsourcing of "high-end" jobs to India cease to be profitable?

Q2: How does the current practice of outsourcing of "high-end" jobs to India help Indians in the ongoing struggle to remove the severe oppression there?

Examples of oppression and their supporting infrastructure:

1) Forced and *uncompensated* displacement of people from rural areas into the cities because of emminent domain siezure by authorities. (Official Indian government figures put the number of people affected by this at around 40Million since 1947. Activists estimate the number is much much higher.)

2) Ubiquitious child labor in the houshold cleaning, and other related service sectors. No real enforcement against it.

3) Child slavery and bonded labor (think "indentured servitude" from your history classes, but much worse.) affecting millions in rural areas. Sporadic enforcement against it.

4) Open physical and verbal brutality of authorities (police, guards, and even employers) towards the poor to keep them obedient and compliant. Personal Note: once on a trip to India, I saw a policeman beat a little beggar kid about 3 hours after my plane touched down. I see examples of stuff like this on every trip to India. I have even heard many well-to-do folks talk openly about how "this is all those kind of people can understand."

5) Right to education for everyone exists on paper only. Many areas have no functioning public school or that school has been "captured" by a subsection of the community with others excluded by overt and implicit discrimination.

6) No democracy within political parties. The voter has no say as to whom will run for a seat on behalf of any given party. (e.g. No caucuses or primaries of any kind.) Rules *preventing* elected members of parliament from voting their conscience on issues affecting their locality.

7) No freedom of information act or sunshine laws. (Even Ashcroft has to obey at least some FOI requests.) Example of a resulting state secret: How much money was spent on the goverment support of parochial (Christian and Muslim) schools as compared to the money spent on public schools open to all?

8) No right to a speedy trial by a jury of peers. Say what you will about the OJ case, etc., participation in jury trials is a powerful way in which the public gets some control over their own destiny by being a part of the justice system. It is a lot harder to corrupt 12 randomly chosen jurors with other jobs than it is to get at one judge who you can count on for repeat business.

Re:Outsourcing on Slashdot: Fair and Balanced?

[spirality]

What's wrong with free markets?

Anyway that really wasn't your point here. If people can't patent things (like AIDS medication) they will not invent it because they will never recoup their R&D costs if it is to be just given away or "legally pirated". Music and drugs are entirely different...

Any two bit idiot can't play music and the cost of creating and producing it is nowhere near to the costs of researing and producing a drug. For every drug that comes to market there are about 10 that do not. The drug companies have to make back their money somehow. Now, that said, sure they may be gouging us in some respects, but still things can not, will not and should not be free. History has proved this economic model fallacious.

-Craig.

Isn't the power of corporations the cause of this?

[freecell_wizard]

I'd like to see some honest discussion of the deeper problem, which is that corporations are artificial constructs that operate outside the control of individual nations or investors/board members, and do not have as their goal the betterment of society or the individual. Rather they exist specifically to concentrate as much wealth as possible in the hands of as few people as possible. It's therefore not surprising that these creations move labor to where the cost is lower.

Also, it's inarguable, if not well-known, that neoclassical economics is fatally flawed and does not apply to the current world economy. So most of the pundits and economists arguing about how great NAFTA etc. are for everyone have no idea what they are talking about, despite their training. Neoclassical economics is based on many false assumptions, and "proofs" of the benefits of unbridled international capitalism are therefore wrong. Letting corporations do whatever they want is just as bad as letting the pre-breakup Soviet government do whatever it wanted.

For that matter, I'm curious: Why are people so deeply distrustful of "big government", but willing to accept an unlimited amount of abuse from private industry? It's just the same problem with a different name.

Cheers,

freecell_wizard

Questions for outsourcing opponents

[Kohath]

1. If outsourcing from California to India is "greedy" or otherwise morally wrong in some way, then what about outsourcing from California to, say, Alabama?

2. Do people in India or China have less right to make a living and feed their families than Americans do?

3. In a business, does management have a duty to artificially maintain relatively high wages in the US for equivalent work? Is that a higher duty than their duty to the shareholders?

4. What duty do the workers owe management in return?

5. Would you support relaxed regulations and tax cuts to help bring the cost of US labor down closer to that of foreign labor?

6. Which world leader is more just: George Bush or Fidel Castro. (This is just to determine who you're talking to.)

Re:Outsourcing on Slashdot: Fair and Balanced?

[arvindn]

I like your attitude.

When toxic computer components are exported and dumped in third world countries, do you protest "American computers" being sent abroad? Firecrackers are produced by 4-10 year old kids in India under horrible conditions. Do you protest the offshoring of the manufacturing of these "American firecrackers"?

Yet when it comes to IT (and previously electronics), these jobs are "American". The comfy, well paying ones. Your God given right.

Free markets work both ways. Regardless of whether the global market is really free, whatever America gets, you're only getting what you asked for.