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An Independent Study on Offshoring IT?
vsprintf writes "What are the real effects of offshoring on the U.S. technology sector? Pick your economist on the subject. The Bush administration's Gregory Mankiw says it's all good, and exporting jobs is just a new way to do trade. In Congressional testimony, Ralph Gomory says a little bit is okay, but too much is bad, while Herman Daly says it's just plain bad. The ITAA's paid mouthpiece, Harris Miller, says it must be good because IT workers in India wear Nike tennis shoes. At last, it appears the IEEE-USA has persuaded Congress to pay for an independent study to determine how offshoring really affects U.S. IT."
So IT workers in India are wearing shoes made in Indonesia. How is this good for the US economy, again?
"[Regarding the 'cloud,'] ownership was what made America different than Russia." -- Woz
The only people who will benefit from outsourcing are corporate execs and stockholders.
The rest of us will be left with nothing to do and it won't matter if goods and services are cheaper if you don't have a wage to pay for them.
Meanwhile the Indians etc. will be undercut by the Chinese and they'll be undercut by someone else.
Where does it end?
He basically wrote all these economic books and once he was hired by the Bush administration, he contradicts his writings.
It's all we have left!!!
If it's the same Mankiw whose book was (and still is) used to torture and brainwash countless undergrads then I'm not surprised he said that.
Didn't Bush just promise thousands of new jobs for the American working class if he were re-elected? How can he promise this while his administration is supporting the outsourcing of jobs to other countries?
Either I'm missing something (I hope I am) or this is the most blatant bit of double-speak I've seen in awhile. The sick part is he'll probably still be re-elected anyway. Le sigh.
"He does look a bit Oompa like, even if his Loompa is a bit off-kilter."
There's been discussion before on this subject which affects us here in the UK too.
I maintain the major problem is gradual de-skilling. If potential software engineers simply see that their future jobs are likely to go offshore, they will not go into the profession. Software is still a somewhat apprentice based profession in that you usually require some coding skills before becoming team leaders or designers and then development managers and CIOs or CTOs.
If you are pulling away base support in the profession, then de-skilling will gradually move up the ladder. More jobs,more high-powered jobs will move offshore until wage parity ensues. By then, it's too late, corporates will have followed the skill base. An industry responsible for (a rough guess) 15% of Western economies will have moved elsewhere.
And you can't compare the software industry to manufacturing. Software is not manufactured and, so far as I can see, will not be manufactured for at last 25-30 years. But guess which countries will reap the benefit of writing the code manufacturing software?
Did he inhale?
It's obviously bad. They should be outsourced to Australia, so I can have a cool new job... althought admittedly most of the jobs are helpdesk and programming so on 2nd thoughts...
Corporations don't pay any taxes these days. If this poorly made garbage never enters the US, no US tax will be paid on it.
Blame In-Jinns! Boycott software! Nuke 'em! Do SOMETHING, damnit!!!
I dont live in the US, but the effects are clearly visible (in Europe less, because the outsourcing is since May within the EU, so basically there is not too much outsourcing)
a moderate outsourcing is good for everyone, it opens new markets because it helps to develop. Massively outsourcing, produces huge trade deficits and basically only shifts money.
What currently happens is following development, currently everybody thinks that companies can produce cheaply and sell expensive here. That only works as long as people have money. The long term trend goes towards crash of the monetary system in the west, or at least in the US, with trade deficits which are enourmous. The classical example of this was Argentina in the nineties, basically a classical example of a country which did not produce anything inshore but imported everything. The crash was imminent, and came around 2000-2001.
What currently happens is that some people thing a patent system which basically acts as a highway robbers tool might help. This might delay things but only for a certain period of time. Once the production is gone entirely, the research also will follow and with it the so called IP holders (which shift overtime, since patents run out), unless the current patent system crumbels under its own weight, because of the massive abuse which is currently happening before.
So what would be the solution. Simple, try to keep certain core industries and research in the country, and do moderate outsourcing which opens the doors for the wealth of everybody. But for heavens sake, keep some industries and research in the country or at least in the monetary zone.
Im sure all the studies are taking into consideration how its a good thing for the corporations and few business's that are able to take advantage of the available workers over seas, but is it good for the people (in america)? Anyone who has a job in the US that are in the know about jobs being moved over seas, would say no, in fact the very idea of saying, "moving jobs over seas is good for the econemy" is the same thing as saying we dont care who does our work, as long as its cheap. When it comes right down to it, if it comes down to your company saving a buck and you having a job in most situations, what do you think will happen?
TruePunk | Games
One common thread to anything done by the U.S. government is that big business is preferable over small business is preferable over independent contractors.
After all, how often does the federal government do anything to protect small businesses or individuals from being destroyed by large businesses?
They are more likely to protect the big businesses from being mistreated by small businesses.
For example, the whole patent system is nothing but protection of big business from small businesses and individuals.
When it comes time for important contracts, who gets the contracts, the big business or the small business? From what I see, it doesn't matter at all if the small business has much greater expertise in the matter.
So if the big business can make money by moving some activities overseas, everything is just fine with Congress.
As long as the big corporations and those corporations with friends in Congress make tons of money, nothing else matters.
Of course, there is a bigger issue that everyone ignores.
When we export jobs, we are exporting vital expertise. After those who used to do the work are no longer up to date, we lose the ability to do the work ourselves. We're not there with software development and it will take a while, but it is forseeable that at some point we won't have the expertise we need to handle emergencies.
So what happens when China declares war against us 40 or 50 years from now? What do we do after they cut off our access to the exepertise we will need to win the war?
Include all the manufacturing that we no longer have the capability of doing without a long lead-time, and we're going to be in serious trouble.
Our chances of prevailing against China will be about like Poland's chances against Germany in the early days of World War II.
It looks to me like we're well on our way to losing the next WOrld War.
Well, first you persuade other countries to open up their economies to your imports, claiming this will enable them to step up on the ladder towards geater societal wealth and towards a more skill-based economy.
Then, when they actually do, and start reaping some rewards from it, you start acting like it's the second coming of antichrist.
So what do you suggest? Stop outsourcing, stop manufacturing abroad? Are you also then prepared to accept the trade retaliations from the rest of the world? Some people applauded your steel tariffs as something good. Of course, the US ended up losing a lot more money - and more jobs - total than it saved in that particular sector by postponing an inevitable restructuring.
Trust the Computer. The Computer is your friend.
Outsourcing "IT" is like outsourcing "engineering."
If the question or design is simple then it is simply begs for a commodity-based result -- an answer or drawing. This is not to say that the people working on these problems are simple, it's just an issue of language, culture, and time-zone barriers.
America and the UK have proven themselves to be at the forefront of technology -- constantly improving on older developments; driving in directions yet unforseen. This happens daily, and in every sector of the market -- it is continual. Sure, some of our problems can be outsourced because they are simple to convey. However, much of our software and systems are more dynamic than we often admit. These "little" changes and enhancements are what I believe will be the demarcation point between offshore and traditional IT environments.
I don't think many jobs will be lost to foreign markets, because they will remain needed here. However, I think more jobs will be created in these offshored markets because of increased demand.
Call me naive, but surely there's no such thing as an independent study? After all, someone's paying for it and usually the someone who's paying for it has already got an opinion. I've yet to see an "independent study" which didn't favour the organisation paying for it.
If you look at whole countries, free trade, in services as well as goods, is a good thing. Even if one country is less efficient at doing everything, it still pays for it to trade. This is such an important theory, that economists have come up with a name for it: the theory of comparative advantage.
However, economics, and particularly the classicial sort of economics, is not very good at sorting out what happens to the distribution of income within each economy. And, as several posters have pointed out, the people who have seemed to do most well out of free trade in the past have been the owners of capital (shareholders).
In practice, it's an empirical question. To use a baking analogy, you have to weigh up the bigger pie that free trade produces against the fact that a sizeable section of society is getting slighly less *proportionately*. If the pie grows enough, it doesn't matter, but that's not guaranteed to happen.
The big fallacy in all the economists' arguments for offshoring is right here: "US GDP increases, so that must be good for the US."
But what's really happening is this: incomes of a few CEOs go up from (say) $1M to $2M, while incomes of 10 times as many engineers go down from (say) $100k to $20k. That's a gain in money terms, but it's very bad for 90% of the people affected. So, it's bad for the USA.
I just think there is an ever-growing paranoia in the developed countries about software job offshoring. Hasn't such offshoring of other jobs happened in the past, like say, manufacturing? Aren't most cars and other white goods manufactured in Japan and China? What happened to the workers in that industry some of who would obviously have lost jobs?
More to the issue, I'm not sure what decides the level of outsourcing - "some", "moderate" or "massive". Even when offshoring wasn't happening, a lot of companies prefered "outsourcing" - subcontracting their IT needs and business to specialist companies who had the skills and knowledge to fulfill them, leaving the parent organization free from the usual worries of delivery, quality, acceptance etc. So if the same happens now, it's bad? Because there is growing fear of losing jobs? Surely, the involved professionals would be smart enough to know that economics drives a business, not preferences!
Further, if the products of US-based companies are used/consumed by people elsewhere, from the (less) money earned from US companies, surely the profits are going back to USA. So the article gave an example of Nike. I'm sure more parallels can be drawn without stretching the imagination too far!
Finally, if the cost of building a product, be it software, is relatively less (and so is the cost of maintaining it), then the cost of direct users/consumers would be much lesser. Say, if the Air-traffic control systems cost less to build and operate, it would lead to less fees towards airlines, which means they can cut costs further and offer cheaper tickets.
And contrary to what another poster mentioned, yes, the corporates may follow the skills, but why would they distance themselves from consumers? They have nothing to gain there, if there is a growing resentment against their products/services. And if they decide to not pursue offshoring, they stand to lose considerable market share simply due to the cost-benefits offered by the competitors. So, from their perspective, its a downward spiral.
Outsourcing is happening. Live with it. Some jobs are going elsewhere. Sure. Are those the best jobs? Surely, it gives the professionals in the developed world better jobs (creative as compared to monotonous, boring, trivial).
Maybe this brouhaha is there because IT professionals have a bigger mouthpiece, and a cheaper and far easier means of voicing their concerns.
http://efil.blogspot.com/
It's good because it is symptomatic of the real underlying issue which is that jobs of any sort are no longer necessary in the most advanced economies.
Think about it, on balance the really enormous social result of the various industrial revolutions that took place in and around the nineteenth century was the end of slavery. Slavery ended because it could, not because it should. This is true with so many things that are attributed to good will and heroic characters. That's all mythology.
This struck me the other day when someone was talking in a wide-eyed manner about all the things that would have to be done manually without industrial and agriculural machinery. The person kept using the pronoun "you" saying "you would have to do this by hand and you would have to do that by hand." I spoke up and said, no actually a slave would most likely have done most of the things you're referring to before the age of machinery.
So, if machinery and centralized power ended slavery, then IT probably will end work as we know it and this offshoring issue is really symptomatic of a huge evolution in society that is just beginning. And, of course, in the beginning the resistance will be enormous and it will still be here hundreds of years from now. In evidence I would introduce, among others, the confederate flag issue in the American South.
mix a general lack of decent economic understanding with personal emotions to bake 1 standard slashdot outsourcing post (serves up to 10)
As it is today, people in poor countries see their young children starve to death, or die from lack of medicine, just so people in rich countries don't have to suffer the discomfort of looking for a new job. Outsourcing is part of a re-shuffling of wealth that may be uncomfortable for a while, but in the long run economies around the world will become more similar, so we won't see the extreme cruelties and conflicts of desperation that we see today.
Terrorists can't threaten a country's freedom and democracy. Only lawmakers and voters can do that.
... and anyone who has a 401K, and anyone who has insurance...
The percentage of people holding EITHER went down massively over the past 3 years... your argument makes no sense.
Why don't you embrace your slashbotness instead of living in a dreamworld?
in such a kind of study is this. Is it possible in the long run that just the US makes money (pieces of paper, no more) while the rest of the world suffers? Is it possible for a single 20 metre tall wave to stay like that in a calm sea around?
An action or transaction that results in monetary gain for the US cannot be construed as 'good'. Hardly anything innovative happens in the US that is of importance for the rest of the world. In fact the US has lagged behind in things like cellphones and bandwidth. And within the US, the patents system seems so messed up, true innovators can hardly be expected to stay motivated.
Money, like blood, needs to circulate. If it accumulates in just one place, it can lead to a heart attack.
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If you keep throwing chairs, one day you'll break windows....
...if the three points below are realized.
1. Free trade of goods. Almost done. Shipping goods from country A to country B is cheap (even if some tariffs are applied).
2. Free movement of workforce. Countries all over the world have a limitation on this. You just can't go to work in an other country. Even in the EU it is not easy (lot of paperwork) to do so. Also, language and cultural differences make a person reluctant to move.
3. Free trade of knowledge. Patents and copyrights restrict the sharing of knowlegde. They should be eliminated entirely.
Big businesses want point 1 to be realized, but do not want point 2 and 3. Until point 2 and 3 become true, outsourcing is most probably bad for everyone.
Government cannot make man richer, but it can make him poorer. - Ludwig von Mises
because IT workers in India wear Nike tennis shoes
I thought digital watches made us happy??
"I did this cuz Linux gives me a woody"
Other IT organizations have also been lobbying this for awhile.
I sat with other Washtech members and tried to beat it in Jay Insley's head (democrat from Boeing, err Everet) that outsourcing was an area of concern, as well as H-1 and L-1 visas.
He tried to tell us that India would buy enough Boeing airplanes (he's head of some India Caucus or something other) and that H-1 visas were needed to help get unique talent like 7' tall Chinese basketball players.
After an hour of listening to us, something must have sunk in, because on NPR he did say he was pushing for a study.
Not the only congresscritter we lobbied, but one I personally shock the hand of.
But whichever effort finally broke the camel's back, I'm glad. Now if enough geeks get busy calling their reps and putting pressure, the study might come to something.
Otherwise, it's just a study. For those of us that already know that the job market is different,a study won't do much but let us know we're not the only ones in this mess. Myself, I now have a higher skilled admin job than I had before, but at less pay. Myself, I don't mind the competition as long as they would get paid as well as I do. Hard to compete with people paid less than half I do.
. This sig unintentionally left blank. I meant to put something here, but I'm busy.
It's the employer's right to do with his property whatever he pleases. How would you like it if there was a law that prevented you from using Linux because it is bad for the economy? (assuming that a study said so)
I am SO tired of fascist and/or communist wankers telling us we should keep entrepreneurs on a tight leesh because what's theirs is actually "ours" (where the "we" is loosey defined)!
It's their business, so it's their choice to offshore it, keep it local or whatever else they choose, much in the same way you can decide to go to McDonald's or to a fancy restaurant, regardless of what other people think it's good for you...
Problem...not everyone can live like the US...if they do...then we all die. There aren't enough resources to go around. 6 billion plus people all can't drive cadilacs. Not that we shouldn't raise the standard of living...but we need population control before that becomes a universal option.
Some people live in the desert and complain that there's no rain
That money can be put to better use in other areas in a company.
/. seem to be Stalinists.
I thought that was self evident, but many people here in
IANAL but write like a drunk one.
While there has been a lot of hue and cry over the IT outsourcing the politicians have conveniently forgotten manufacturing outsourcing which has plagued America for decades. Long before CA was hit by .com burst NC was hit by import of cheap textiles from south-east Asia and Mexico. Thousands of workers were laid off (e.g., pillowtex,lee). The biggest gainers are people like wal-mart/circuit city/best buy who offer dirt cheap stuff because the stuff is 'made in china/Taiwan/thailand'. Tell me how many computer companies manufacture their stuff in usa? Even the darling-of-slashdotters apple makes stuff in china.
IT is a service sector. It requires a strong brick-n-mortar sector for survival. We need to strengthen our manufacturing base first. This would put more money in the pockets of people. They would in turn, demand better service. Cost of source then wouldn't be the paramount factor. American IT folks can gain the edge by providing better service.
The Bush administration's Gregory Mankiw says it's all good, and exporting jobs is just a new way to do trade.
Hmm, I guess the trade deficit must be at an all time low then.
...cos it's always better to have somebody else doing your job aint it?
Now if you're a shareholder of Nike, then it may help you that Indian programmers are wearing Nikes. If you're the CEO of Nike it sure as hell is going to help you.
If you work in a Nike factory overseas it may well help you. But Indian programmers wearing Nikes aint going to help you when you're working in a McJob wishing you could afford to buy a pair of Nikes for your kid.
Never confuse what's good for large corporate shareholders with what's good for you as a jobbing programmer.
This ecconomic strategy was brought to you by the same people that brought you the US National Debt... http://www.brillig.com/debt_clock/
You spend what you EARN. If you don't you end up in debt. It's not rocket science or *gasp* ecconomics. The idea of turning yourself into a service ecconomy is fine if you're Ireland, but if you're a large country you actually have to make and sell stuff to support your ecconomy.
... once Indian work becomes too expensive a magic wall will stop cheap UK and US workers providing those same services.
Smell the coffee folks, what may be working against you now may be your blessing in the future.
Global markets and competition are here to stay. You either get used to it and act in consequence or will be left behind with your unemplyment benefits.
IANAL but write like a drunk one.
I think this would spark off a downward trend.
First, corporations outsource, and locals loss jobs/move to poorly salaried jobs.
They will have less spending power, and hence only able to afford cheap china branded imports etc.
Local businesses still employing expensive americans in manufacturing etc feels the heat since they just can't compete, so either they will go bust or outsource too.
More jobless.
The cycle continues.
Finally, one fine day China can just openly declare "we are going to take over Taiwan, be it by peaceful means or by force!" and when the US president then tries to say something out of his ass, every equipment in the military fails! OMG! Apparently all the military stuff is made in China too!
And USA got PWNED!
Ok ok, seriously that wouldn't really happen, but if outsourcing goes on, a lot of social unrest can arrise in the states..
Online backup with Mozy, sounds like Ozzie, but more!
... Lets get a truly unbiased assessment by sponsoring slashdot's own outsorucing effects study, we would come off looking really trendy, especially if we outsource the work to India.
Only to idiots, are orders laws.
-- Henning von Tresckow
I really like this video of him.
http://www.musicforamerica.org/bushjoke
Two things: 1) Reuters reports that Indian is outsourcing outsourcing. 2) Reuters also report around Aug. 30/31 (but I can't find it now) that CEOs of companies that outsource make more money.
rewriting history since 2109
But the top tax rate should be 60% at least
eat shiat and bark at the moon
Lets say you mandate that US or EU (or whatever your locality is) based companies do not outsource or outsourcing becomes tightly regulated.
If the costs are cheaper elsewhere the companies may find compelling to move operations abroad, thus the original country would lose both the employments places, tax revenue, etc.
The original country may raise tariffs against the products of the prodigal company, but in some situations it may still be cost effective for a company to pack shop and move elsewhere.
Many countries tried these protectionist policies and the only think that happened is that a local industry stagnated unable to compete with foreign producers and hypersensitive to the smallest of competitions of any kind.
Isolation and regulation will not solve any problem, an strong social security network may mitigate the personal consequences of international trade.
IANAL but write like a drunk one.
The politicians who allowed to happen should be hung. I am not recommending any sort of illegal activities, but instead I am saying that we need to indict, try and punish these treasonous politicians. If we fail to offer any deterrents to this sort of treasonous behavior, then it will continue. Why should it not? THe benefits are there for those who do this sort of outsourcing treason. But there is no downside.
eat shiat and bark at the moon
The problem is with how business is done today with the concentration of intellectual property rights in the hands of the corporations. Workers have no basis to compete, even though they were the originators of the most of the intellectual property.
Everyone uses the Luddites as examples of being against progress, but the Luddites are really about who owns and controls the technology. Well, the mill owners won that battle and instead of master craftsmen making a decent living and supporting their families, we ended up with the industrial revolution with horrible working conditions with child labor because adult males weren't nimble enough to work in the new factories, the latter ending up unemployed.
Progress doesn't automatically mean things will get better. They can get worse, a lot worse. Trickle down economics didn't work back then. Today the trickle seems to be in the form of a hemorage of jobs going overseas.
We need to think about a system of empowerment and ownership that allows US workers to compete. The Shrub talked about ownership being to own your own house, but you need a job in order to pay for a house. How about ownership of work or the means to work at least?
I hate to say it, but it might end back home. Basically once the local economy has been so badly undercut, either minimum wage will drop terribly or the resulting depression will mean that your average IT worker will hire off for some Doritos and Udon as a salary...
I'm not entirely joking either... the economy does have a stress point. When reached things will either cycle back to square one or explode....
If offshoring means that products can be made cheaply and more efficiently, why not?
This is called competition and will put pressure on people in the U.S. and Europe to get off their asses and be more competitive.
I come from Ireland, and we have taken many jobs from the U.S., and in turn India will (is?) take them from us!
But sitting back and slapping trade controls etc. isn't a solution, it'll just make things worse for those in poor countries, and in the long run probably not be beneficial - because we won't have pressure to be competitive!
6 billion plus people all can't drive cadilacs.
This is certainly true, and it's an important injustice.
But the extreme cruelties and conflicts of desperation are not from lack of cadillacs. It's from fundamental issues like lack of food, water, medicine, and basic comforts.
As for getting luxuries and additional comfort without destroying our planet, technology may offer solutions, as more and more people put their minds to these problems. Today only the privileged few in rich countries can contribute to this development (I'm exaggerating, but I suppose you understand what I mean). As economy improves in more and more countries, just imagine the potential, when billions of people can contribute, inventing, developing and buying environmentally sound technology.
Terrorists can't threaten a country's freedom and democracy. Only lawmakers and voters can do that.
Yes, but unless the patent laws are fixed, then somehow I think innovation is going to suffer. It's quite hard to come up with something new and incredible when either a concept patent or a component patent makes the idea completely unsalable/unprofitable before it even gets off the ground.
NoNoNoNo You got it wrong, the revolution won't be North vs South. It will westcoast Vs eastcoast!
Emacs is good operating system, but it has one flaw: Its text editor could be better.
It's funny to me that everyone here gripes about big government this and government intruding on me that, but wants strict government controls on who American companies hire to do their IT work. You can't have it both ways, unless you believe the Democratic Party has some kind of magical ring to that effect.
My personal feeling is that capitalism works. Yeah, some poor bastards are gonna get stepped on, but that happens no matter what and I'd rather be rewarded for my own hard work and ingenuity than have some lazy bastard kept in the gene pool by my efforts. Survival of the fittest.
You can go ahead and say I have no heart. It's not true, and more people would learn how to work their asses off for a living if they actually had to like the American Way requires. (Even the economically freest times in American history just required really hard work - the homesteaders may have got 160 acres for $0, but they had to work their asses off to use and keep that quarter-section.)
Bring on the outsourcing. If quality suffers, there will be companies that provide good American quality at a premium like in every other industry. If it doesn't, then we have nothing to bitch about because it frees us up from the slave labor world of IT to do something worthwhile with our lives. I'm back in school and quit my bitching after a year of barely working (well, 70 hours a week but barely paid)--I found a company that despises IT outsourcing, believing having someone on-site is the rule in IT, not the exception--what are you doing about it? Oh yeah, what you always do when life gets you down - bitching on Slashdot. Good solution, genius.
"ultimately there will be one person doing all the work" ... outsourcing taken to its extreme.
That's where it will all end.
Actually the west is moving away from free markets, just as the rest of the world has been perusaded to move towards them, so this is no surprise (examples patent and copyright laws deisgned to protet existing industry stuctures for fear of job losses, high regulatory burdens which criplle start-ups and small firms, heavy government subsidies for certain industries)
You are correct to remind us that capitalism is not a zero-sum game; wealth is created. It is unevenly distributed, but still, most people have gained in the past. If your boss increases his own income by $100k and increases yours by $5k, well, the bottom line for you is a gain of $5k.
Now, that is changing. Today's CEO is greedier than Carnegie or Rockefeller or J. P. Morgan were. To increase his personal income by $1M, today's CEO will destroy the careers of dozens of engineers. They are not being replaced by automation, which increases the productivity of other American workers. They are being replaced by Indians and Chinese. To economists, it's a gain if one man gains $1M while 10 others lose $80K each. In the real world, it's a disaster for our society.
One possible way to attack the problem, without unduly restricting the economic freedom which helps the whole world to progress, would be to recognize what these CEO's are doing. They determine their own salaries, in reality. A CEO who takes home more than 40 times the median salary of employees in his company is basically a thief. "Compensation" in excess of 40 times the median salary in the same company should be regarded as prima facie evidence of theft.
Companies win bids for state contracts by massively underbidding small local companies, and send the labor offshore. They do not pass the savings they get by employing cheaper labor back to the state, the companies pocket those as profits. Only one group of people wins here, and it the companies.
It does matter where people are located. It isn't right that entire towns in the US die because the company headquartered there is allowed to up and move to a place where the labor is cheaper, and where they do not have to abide by stricter labor and environmental laws.
In the US, companies are allowed to exist by the will of the people (they must get incorporation papers from the government, the government [supposedly] is for, by, and of the people. That means that in the US, corporations have a responsibility to the communities that allow them to exist.
I work for a tech firm that does outsourced tech support in the US. Several of our clients are those that outsourced to other countries and have returned to the US for our ability to speak English, and our ability to respond intelligably. I personally don't see anything wrong with the offshore concept but there has to accountability for accuracy, someone on the other end of the line is not enough.
No guarantees on spelling or grammer(from me at least)
Moderation is for monks. -Lazarus Long
If you leave in or near a US city, making "six figures" doesn't mean you're rich; it just means you can afford a house and a car.
Oh, you mean the rabble. (like me) Let them eat cake.
At the meeting, Hira described some of the adverse effects offshoring is having on engineers and other high-tech workers in the United States.
Of course, outsourcing has "adverse effects" on US high-tech workers; we don't need a $2m study to determine that. But if people in India can provide IT services more efficiently than us, they should provide IT services. And that's not something India forced upon us, it's something we have pressed the rest of the world to accept for several decades now.
And it's not like it's anything new: textile workers, steel workers, many parts of the service sector, manufacturing, assembly jobs, etc. have all moved overseas. Why is IT supposed to be special? Slapping together a VisualBasic app or debugging a network requires no more skill than assembling a car or making a suit.
What we have is simply the term "free trade" applied to deals with 3rd world countries where our corporate sponsors can get CHEAP LABOR without bothering to enforce the terms of the deal.
If our president(s) gave a rats ass about the middle class, then they'd get our trading "partners" to enforce the labor laws they ALREADY HAVE and ALREADY AGREED TO ENFORCE.
Why don't they do this? Because doing so would mean higher wages in those countries and increased costs for the corporations that got them elected in the first place.
We all do things to keep our jobs. So why the shock/disbelief when they behave exactly as they are incented to behave? Most politicians, both Republican AND Democrat, simply do things in their own self-interest.
If they can benefit themselves AND the middle class, then they'll do it. But if they hurt their political career (ie lose corporate sponsorhip that pays for all the media relations to convince people of bullshit) then they will probably choose to help their sponsors rather than the middle class.
One way to they do this is by getting the help of the media to portray behavior that hurts the middle class as something very helpful. For example, we don't hear from the media that Halliburton is facing massive lawsuits from people who were hurt by asbestos. What we hear from the media is how all trial lawyers are evil and hurt the middle class. What will most likely happen is that trials with merit (ie company intentionally selling dangerous products that cause infant mortality in order to profit) will get lumped into the same category as a fraudster trying to scam insurance companies.
Who pays? We do.
Who benefits? CEOs of corporations that want more freedom to sell shoddy, harmful products without worrying about being held accountable. "Oh, we can make the baby toy more safe but it'll eat into my $1.5 million Christmas bonus? We'll thank God we no longer have to worry about trial lawyers. Just sell it as-is and recall the product if it gets out of hand."
What will the media say? Victory for the masses because insurance premiums WILL go down. And silence when the premiums stay the same or even goes higher due to more people getting injured (ie more likelyhood of asbestos-like massive injuries).
you see US companies save money by outsourceing they in turn invest that money on R&D, growing thier buisness and/or capital improvments....what does all this mean...MORE JOBS. Becouse if you are spending money for R&D, growth, and/or capital improvements then you are hiring people to do those things. I would say i feel bad for poeple who lost thier job to someone over seas...but why should i care for an american stranger more then an Indian stranger...especialy considering that now the products i buy are cheaper and the job growth and investment rate in the US have grown.
Anyway this makes more sence to me then all those lumber workers in the Pacific NW who lost thier jobs becouse of spotted Owls...which are not being saved anyway becouse it turns out that it wasn't logging causing thier decline, but in fact its another species of owl out compeating them...is this ironic??
Tech workers lose jobs becouse of human competition while loggers lose jobs becouse of owl competition...
ok that isn't ironic, its just a fluke.
stendec@gmail.com
Michael seems to think that only Americans should do programming... it's all he ever posts about.
What I'm personally seeing is that the US/EU companies are firing the junior programmers and keeping the senior architects due to outsourcing to India. The effect of this is to essentially cut out the entire next generation of software architects because they do not get enough experience (and often quit IT totally).
If you were a selfish nationalist , they are selling tomorrow for today. But if you were a Capitalist nation , it makes perfect senseDon't dish it out , if you can't take it applies for Capitalism as well. (think of this as payback for all the agent orange and napalam used in name of Capitali^H^H^HDemocracy)
The real sad part is that actual losers in this nothing to do with the past events which built up to this (and neither will those of the future).-- 250 USD per month and 70 hour weeks does not a sweatshop make.
Quidquid latine dictum sit, altum videtur
...customs and cost of living for the "equal" part in trading. The US had a successful internal market because we had a more similar cost of living and more similar set of laws and rules and regulations within the 50 states that traded across borders. This is NOT the case internationally. A worker (or business) living in say Kansas "competiting" with a worker in say Wisconsin had a much closer set of base lines to deal with than what is promoted now internationally. When it's a highly skewed as it is in cost of living and median currently established labor costs you will get what we are seeing now-massive trade imbalances, rising unemployment, dropping wages and lost benefits. It would only be beneficial trade if it was fair trade, and fair only exists if the laws are more equitable and the cost of living starts out as more equitable when the trade commences in earnest on a very large scale.
(amongst other places, none in the USA)
So how it is good for the US (other than for a few Nike shareholders?)
Oh yeah - trickle down economics... I forgot.
I am very small, utmostly microscopic.
EXACTLY in the same way that an US consumer buying Nike shoes benefits the whole economy.
however, we do have :
the caveat : IDIOTS that do not understand this basic economic rule will not benefit !
the bad news : the above uppercase-tag includes you, all your parent posters and the morons that moderated all of you up.
Just be glad that the forign workers are still working for American companies. Eventually the trained and experienced workers overseas will start to realize that they can start up thier own companies. Im sure having all the profits from their work sent off to American millionaires wont sit well with them.
I started out "life" as an engineer. By the early nineties that was pretty much gone. I don't know if it was outsourcing or what - just companies going out of business or downsizing. I was always good with computers so I focused on that aspect of my career. Frankly, programming seemed to be what I was doing the most of as an engineer anyway. With computer technology on the "outs" in the U.S. there is little for technically-minded people to do. You can spend 100k on college and work at a grocery store, but I would think that is "a bit" of a disappointment. I teach at the college level part time and we are still seeing a continued drop-off in technical courses. I am surprised that I am still teaching this term. Nevertheless, people go to college to try to obtain decent jobs. So students will gravitate toward those areas that have the best pay / interest for them. What I worry about is what I may have to do next. I have a lot of un / under employed colleagues. I know many people who have switched careers (Real Estate, etc.). Seriously, I would consider becoming an automobile mechanic or residential electrician. Let's see, and auto mechanic with a P.E. license or an electrician with a BSEE. With IT salaries falling these are viable options in America. I just think it would be funny that the grease monky who works on your car has a master's degree, makes more money and works less hours than his previous corporate job. The fact is the developing countries can produce perfectly good engineers which means that all engineers have to compete with them. I do not believe that anybody can stop the world economy. I don't believe in "zero-sum" economics, but in the short term there is going to be a lot of pain from the richer / costlier countries. Also, let's hope the Chinese and Russians do a nice job designing our next generation military systems so that we can continue picking on people we don't like...or vote Bush out.
Big corporations, the ones doing the outsourcing, do not provide the bulk of the jobs. For geeks, which to some implies having more intelligence than the common worker, some of you are dumber than the proverbial doorknob.
The primary job creation engine of the economy is the small businessman (or woman). Big corporations get the headlines because they usually affect people in larger numbers at one time. However their numbers are really not that meaningful when you look at the number of people employed in this country. There are 138 MILLION people working in the US.
How many jobs were outsourced? Now, looking back on history shouldn't we consider the 70s the age of outsourcing automobile workers? The 80s textile workers?
As for the job creation. The capital gains tax cuts and similar equalizing of the percentage of income tax benefit the small business greatly. I know, I have four relatives with small businesses who have grosses from as low as 500k to nearly 5 million. Guess what, they have more money and they did exactly what was expected, they hired to grow even bigger.
Now what will stop this? Simple, raising the taxes on the "evil rich". Sorry, the proposed plans will smack down more small businesses than anyone. The ones with the millions and billions have relatively no income and have the means to dodge nearly most forms of taxes.
In the end the only proper way to deal with taxation is by consumption. The rich consume in a very big fashion and the fairtax will accomplish that. http://www.fairtax.org
* Winners compare their achievements to their goals, losers compare theirs to that of others.
This is the basic economic rule!
One of the most effective ways of ending the free exchange of ideas is to posit that they somehow violate the basic tenets of "diversity". Claiming that an idea is racist is one of the most important ones, and is pretty effective at limiting the discussion of immigration, criminal justice, schools, and even offshoring.
The idea is simple -- since offshoring generally involves non-white workers taking the jobs of white workers (when, in fact, it could be entry-level black American workers being replaced by white Russians), opposing offshoring *must* be racist since it implies a desire to prefer whites over some minority group.
Ultimately, jobs which can be exactly and specifically tied to a process / response tree (a flowchart of actions) are easy to outsource.
Programmers who are handed a function spec and expected to return with a function can be outsourced.
Creativity cannot be outsourced effectively. It lives where it lives. There may be creativity in the other country, but that's not outsourcing.
Most outsourced IT fails not due to the failure of the outsource employees, but due to the failure of the inside company project managers. As any consultant can tell you, the vast majority of people who think they know how to manage a project clearly do not. As a result, what gets sent overseas are poorly thought out specifications that don't properly describe the process the project manager intended, which itself never matached the user's need.
When I sit in a meeting with a project manager and an end-user constituency representative, 90% of the time I spend is reconcilliation of the ideas from both -- when they are quite sure they'd already done this "in the spec"
As long as there are bad specs and bad managers to watch over them, there will be jobs for local people with the chops to turn those into functional code.
-AP
The problem with quotes on the internet, is that nobody bothers to check their veracity. -- Abraham Lincoln
the average US citizen is free to benefit from Nike's success directly as a minor shareholder
So does this mean Nike will be passing along the savings to consumers as well? No more $169 for a pair of sneakers?
Naa....
and nike shoes are manufactured where?
An excerpt from http://alum.mit.edu/ne/whatmatters/200408/index.ht ml
Basically, more grist for the mill that the story of 'no significant impact' of outsourcing is incorrect.
(And, alas, the luster is also gone for McKinsey & Co. - now portrayed as just another in-the-pocket lobbyist...)
It's not even close to a free market, and if you insist on calling it that, I'll ask for your detailed proof of it....I see a completely unfree market, not only totally unfree but massively unfair as well, except for a ferw elite connected ones. A free market would mean at a minimum either zero tariffs or exact equal tariffs on import and export, both ways, on all goods and services. It doesn't exist in reality, so don't insist it does in some far off futre that hasn't arrived yet. A free market would have exactly the same regulations and workplace laws, either zero, or the same. And so on.
Actually, I'm a little older than most folks here on slashdot and I started "noticing it" and lobbying against globalisation in the early 70's, all the way to face to faces with congress people. And everything myself and many others warned about has happened. And it will continue to get worse and the really big losers are the US middle class. Some folks are actually sophisticated enough to "notice" the difference between produced wealth and artifically produced credit, and we can point it out. Fort example,no matter how many times the shills call 30 year mortgages (or now interrst only mortgages) better than the ten year ones I remember, it's still a worse deal for the consumer long term. Same with big ticket items like cars. Some of us have noticed that day to day figures and realites don't jibe with what we were promised and told about 25-30 years ago. All we have seen is crappier products on the shelves, an artifically inflated dollar that gives people the illusion they have more but gets them less in the long run because of the higher credit that has been massively pushed on people, and a steady erosion of benefits and pensions, with the projections for them to continually keep getting worse. I've seen first hand and personal what happens to small communities when the largest local employer offshores (leaving upper management intact of course). No, they aren't "better off". I've also been effected by the currently illegal immigrant invasion which is tolerated and encouraged by the billionaires.
It's not a recent phenomenon or interest of mine, and I've been pretty consistent on it. Giving corporate tax breaks to companies to outsource is just wrong. Trading without a quid pro quo tariff structure is wrong. Imposing a million detailed laws and regulations on people, then telling them they have to compete with an area/government that has little or no such laws is wrong.
And besides that, I'm a patriot and nationalist, I think it's a function of government to look out for the most people in it's nation, not the top 1% wealthiest internationalists who happen to have a home and HQ inside the US but are really internationalists and loyal only to their own personal profits at the expense of their neighbors. That's a morals and ethics issue there, so if you disagree we'll have to leave it at that, it's not exactly quantifiable in terms of only dollars.
I think everyone's getting a bit carried away here with all the gloom and doom. really. i think most people will be chuckling at this thread in 10-20 years time.
The US does not get the money.
Current tax laws allow US corporations with foreign operations (multinationals) to allow their overseas branches to retain profits. Even worse, many "US" corporations have moved thier headquarters off-shore to avoid paying Federal income taxes on their aggregate operations. Case in point - Accenture, the progeny of Arthur Andersen, has moved its headquarters to the Carribean, is active in outsourcing work abroad, and has many federal contracts.
I suppose your arguing the theoretical point that increased profits for US corporations == growth in the US economy. Certainly, those who own shares in the outsourcing companies will see a rise in their wealth. But how much of the share value is eventually translated into increased domestic consumption, as opposed to being effectively banked, and then spent overseas, or spent for the good of the corporation? Are we better off when those who actually, really own the corporations - the top 1% of those people in the American economy - earn more money through increased corporate profits or when the average worker earns more money?
The world financial system is also unlikely to allow the US to continue with a grossly inflated dollar. US companies will be in a much poorer financial position is we face a currency crisis similar to what happened to the British pound a decade ago. Ironically, our current desire to import all of our manufactured goods, thus creating a gigantic trade deficit, combined with the Bush administration's penchant for enormous deficits, will inevitably weaken the dollar, making outsourcing less atrractive.
But the damage will be done. The wealthiest Americans will get the money. The middle class will continue its long fall into poverty, and investment will be directed from abroad. This is a disasterous situation, all caused by short term greed. We should care more about who gets the money, rather than which country. If we destroy the US middle class, other countries middle classes will follow the same path. We're looking at the beginnings of dystopia.
/* Dang, I can't type that well. */
"...to each according to his need, and from each according to his ability."
The wealthy of this nation have the vast vast majority of the wealth. We need that money to pay for housing and for education and for healtcare. And also for medical research. It is abundantly clear to me that laissez faire, neoliberal, and supply side economics does NOT work as advertised, and is really just a facade for greed. I say we raise the top tax rates to 70% and take the wealth of America back from the parasitic rich.
eat shiat and bark at the moon
A given firm or person has a given amount of capital with which to run their business.
In all cases, when a firm or person has to pay for a service or item, the cheaper the service or item is, while still providing the necessary quality, the better it is; for it permits than firm or person to undertake a larger amount of work from the same capital.
The more work which can be done from a given capital, the greater the profit; and so, the greater the growth of capital over time.
It is entirely foolish and self-defeating to, if one could, force offshoring back into the US, for doing so would raise the price of the services they offer and so reduce the amount of work which can be undertaken from a given capital, and so reduce the overall rate of growth of that capital, which forms a part of the GDP of the country.
Competition, with the concomitant reduction in prices for items or services, is part of the very core of the efficiency which makes the free market what it is.
And reduction in competition increases prices, which in turn increases the costs, and so reduces the profits, of any dependent industry.
Given the vast range of industries which require software, reducing the cost of software development enhances the overall profitability of all these industries, which in turn provides them with additional capital to undertake an increased amount of work in the future - which means needing to employ more programmers, more workers, buy more services, more software, etc.
--
Toby
I already backed out of one project. Even giving advice seems problematic since you may end up having to do an actual implementation to show how it's done. Plus some concepts are just hard to get across. And not least is the irony implicit in the unemployed giving advice to someone who is totally unqualified to do the job they're got.
Maybe you can specify a tennis show down to a 'T', but even with the assistance of a large consulting company, a large bank foreign-exchange system is different.
Sometimes doing business 10,000 miles away and at the other end of a telephone is too expensive. This is independent of the quality measures proposed.
See my journal, I write things there
Can someone point me to a link on where Kerry stands on this? I'm still undecided as to whom I'm going to vote for.
Thanks!
We decide what goes on in this country, down to the rules and law that decide EVERYTHING. If WE decide that outsourcing should be illegal, and that anyone who participates in it should be skinned alive and then burned at the stake, then that is OUR choice.
It is a government for the people and by the people, according to the constitution.
eat shiat and bark at the moon
"...think of this as payback for all the agent orange and napalam used in name of Capitali^H^H^HDemocracy"
You worthless pcs. of shit.
Some how I don't think that the Service Men/Women who died trying save South Veitnam where thinking about "Captialism" - esp. those who Volunteered.
It truly is the WORST experience, if you happen to connect to someone in India. The last time I called for support (for Vonage), the phone call took probably twice as long as it would have if he knew what I was trying to say (and vice versa). Adding in the frustration of the whole experience (plus the 45 minute wait), and the bad word-of-mouth that I am going to generate for Vonage, I'd say this off-shoring trend will not last too much longer, if I am an example of an average (well... maybe above-average) consumer.
How come they don't bring in 400,000 lawyers or doctors on H1-B? We have been very politically naive and have now been sold up the river by industry, VCs, Harris Miller, the ITAA, the republicans, and others. Also, try becoming a citizen of China, India, or Japan. They are far more protectionist, monoracial, xenophobic, and lets just say it, racist. Why should we open our borders and society more than they do? If you are interested in a thorough analysis of the issues, be sure to look at http://heather.cs.ucdavis.edu/itaa.html -LUH I have only one question for the voters: is the rich person you are working for better off now than they were four years ago?
The requirement for IT to be anywhere is directly relevant to the application. You can get anywhere in the world if they know your application, but sorry, there are many people who lack domain specific knowledge. Yes there are things that are well defined that are possible to do offshore, but take something a little more complicated. Sorry, you have just lost a lot of money.
The management excuse is the same as during the S&L saga as in "Whoops, really?". They simply turn around and say that "everyone else is doing it" having just lost the bank a bundle.
See my journal, I write things there
> Nike CEO makes more profit by making those shoes in Indonesia than if he were doing so in Texas or Scotland etc.
If Nike can make more profit by making the shoes in Indonesia, they *should* make them there. Eventually things will equalize, but that means wages have to drop in the US and raise in Indonesia. Othewise it's just going to be cheaper to produce in Indonesia, so that's where it will happen.
Americans cry a lot about some lost jobs, but the people who are _getting_ those jobs now might well have been unable to afford a few handfuls of rice per week before that. They are no less deserving of the jobs that you are, and if they are willing to do them for a tenth the wages, they *should* be the ones to get them.
The money you make is a result of supply vs demand. When most of the engineers/programmers/etc are employeed throughout the world, the salary will be good, and all developed countries will be fine. When you add in a new country out of nowhere, the supply increases, the demand for any ONE person is lessoned, and thus the salary lowers. This HURTS ALL developed countries. It only helps emerging countries. Is Japan and europe worried about this too?
So what happens when China declares war against us 40 or 50 years from now?
Why should they want to invade, if all knowledge has left the USA because of heavy outsourcing and all that is left are a few hundred million people whose major skill is to ask if one want fries with the order?
Seriously, that is one of the most ridiculous arguments I heard against outsourcing. Brain-drain and loss of skill are serious problems, but before worrying about chinese supertanks and missiles, one should be concerned about being able to keep up with the industry, having jobs for people that aren't rocket scientists etc. first.
I think one thing people overlook is will kill or hurt all jobs for all countries. Not just programming in the US like the media portrays.
Right now, programming, engineering, HR, accounting, and call centers are being outsourced.
When there are no more public accountants in the us, what will these people do for a living.... They will go into a new field. This means all fields will have more workers then they need, and thus all fields of work will face lower wages and less job security.
Next, why would a big corp, after pushing hr, accounting, call centers, and engineering, not just go ahead and move everything to another country? Theres NO reason not too.
When that happens, what other jobs will be lost? Window washers, janitors, vending machine stockers, etc, etc, etc...
All of the argumnts, pro and con, I see posted here assume one thing: that the service they are getting by off-shoring is equivalent. It is not!
The one place where I am affected by off-shoring every day is tech support. I maintain the computers for my company and I maintain the computers for a lot of small businesses on the side. It necessarily involves a lot of hardware installs and, thus, a lot of tech support calls. Did I say calls? When was the lat time you could actually call and get a real voice on the other end? Almost everyone has moved to e-mail based tech support. Many of the web-sites for computer hardware no longer list any phone numbers.
And here's my point. It is becoming increasingly obvious to me that those e-mails are all directed to someone with absolutely no knowledge of the English language. I have started collecting the e-mailed questions I submitted and the nonsensical responses I receive because some of them are hilarious.
A question about signal strength to the manufacturer of a Bluetooth USB adapter was answered with a discussion of the speed of the unit and culminated with: "As the unit is not powered the speed would be too high."
I have given up on all tech support. If I cannot get hardware running myself, in just a few minutes, I return it and try another product.
It really doesn't matter how much money companies save by off-shoring. Pretty soon they will be saving a whole lot more because they don't need any tech support at all when they go out of business!
Somehow I don't think that the service men/women who died trying to "save" South Vietnam were thinking about "Capitalism" or "Democracy" either. I am sure that most of them were thinking something like "I've got to get out of here".
However I do think that this was exactly the thinking that led the senior brass in Washington to send them there. The Vietnam war (and the Korean war too) was prosecuted because the rise of communism was seen as a threat to the American way of life - in other words a threat to Capitalism.
Unfortunately America preaches capitalism and free market economics all the time but is very two-faced about this kind of stuff. Massive subsidies to domestic industries and sanctions against foreign industries is directly contrary to these ideals.
Interference in the affairs of other nations is rarely welcomed, whether that is done through economic means or with a gun. The US doesn't like it when other nations try to interfere with its own internal affairs. For some reason though they seem to think it's perfectly OK for them to interfere with the affairs of others.
When you behave like that payback is inevitable - another name for this concept is Karma.
One solution is simple.
To be considered a US corporation, the corporation must employ a certain percentage of US employees. Say 90% or so.
When they lose US status, they should have to pay extra taxes to 'import' their products to the US.
The gov uses these taxes to fund new projects, and to give tax breaks to good standing US companies, hence recreating some of the lost jobs.
In other news, Congress has decided to off-shore the independant study to India to save costs.
I think it makes an excellent point. No one has a "right" to a $90K job when a guy in India will be deliriously happen to do the same job for $20K, because his alternative is to make a hundred bucks a month.
Who deserves the jobs is who can do them the best and cheapest. No one "owes" you a job. And if they do, why don't they also "owe" jobs to the family in Indonesia who's starving because they can only afford a handful of rice in a week? What makes you so special to deserve $90K/yr when people like that are not eating and don't have clean drinking water?
Just like you view that $2Mil/yr CEO as being a thief, those people view _you_ as being the thief. And certainly you don't get to keep the job if you aren't willing or able to compete with someone in China who's got a PhD and will be happy to do it for a tenth the price.
The problem here is that you're wrong. As others have mentioned, the "90% of the people" you are talking about is really something like As others have mentioned, the stockholders also benifit, as do the consumers (if the outsourcing is handled well) or their competitors (if it is handled badly).
But even more important, it benifits the economies of the countries to which the jobs are outsourced, and as a consequence benifits many people who just aren't americans but are nonetheless just as real as you are. This is where the real value of outsourcing starts. Every one of these people now has a personal vested interest in seeing the US stay healthy and strong, and interest in peace with the US instead of war....
For the last five decades or so our main export has been weapons and weapons-related aid. Guess what sort of interaction this fosters with the rest of the world?
Free trade (including outsourcing) may disrupt the status quo in complacent markets but it does far more good in the long run for both sides.
-- MarkusQ
P.S. This should not be read as support of GWB, even though it appears we happen to be on the same side of this particular issue. I still think he's a dangerous lunatic and wish they'd found someone to run against him.
Ok... so, I keep hearing people posting saying that "Bush is outsourcing jobs". Hogwash. It's companies that outsource jobs. Not George Bush. Why do they do it? To make more money. It's called capitalism. When I shop for hotdog buns, I buy the cheapest hotdog buns. When I shop for workers, I buy the cheapest workers who can get the job done. You do it. I do it. And businesses do it every day. Capitalism! Competition means lower prices and/or higher quality. You know WHY capitalism used to work? Because people didn't complain about businesses getting away with stuff like this. People would say "Hey, Dell is offshoring a bunch of jobs. I'm not going to buy Dell anymore." Remember the old "Buy American!" commercials? Do you know why they had to tell people to Buy American? Because American-made goods are more expensive. So, instead of telling the government that it needs to pass more legislation to "encourage" businesses to stay on shore, why don't you put capitalism and your right to choose what you buy to work, instead of just complaining and taking the democrats path which is "Please fix this for me!". Government should NOT have that much of a thumb in businesses' pies that they can dictate where they do business. That's what consumers are for. Tell Dell and whatever other companies you hate that you disapprove of their practices by buying from their competitors and recommending that others do the same. Oh, what, the competitors' goods are more expensive or of lesser quality? Surprise surprise. But laws and hefty changes aren't going to help that. You have to show companies that you want their businesses in the U.S, and that is your duty, not the government's.
> Problem...not everyone can live like the US...if they do...then we all die.
Right! That is why at the same time standards of living raise in the developing world, they must fall in the US and Europe. The US standard of consumption is unsustainable on a worldwide scale, at least until technology improvements make it so, which will not happen for a long time yet.
Outsourcing is a simple matter of economics - you cannot stop it any more than you can stop the wind from blowing. In the end, yes, you are unhappy because you cannot buy that Porsche, and you might have to live on $20K/yr instead of $80K. But at the same time, a family in Indonesia can now afford to **eat**, and that is more important than your shiny new Porsche.
It's not about an Indian company starting up and competing for contracts...it's about Your AMERICAN bosses taking the profits of YOUR hard work, inventiveness, and loyalty and cashing in for a quick buck for people in some petty dictatorship they don't have to pay a fair wage.
In most cases companies are spending MORE money on outsorcing and reaping far short of the returns they're supposed to...It's so bad the US SEC is trying to regulate outside countries business practices! What SHOULD be happening is to let the overseas investments hang...just like the US workers have been hung out....but that won't happen...we just send in the army to invade.... That's the REAL reason we hate Cuba so much. They were on their way to american business takeover like hawaii when the commies took over and took their country back from american business by force!! That's also why terrorism is such a big deal...because we can't REALLY lock down the country because we expect all the forigners to be trained here...and we have to protect all those american business men overseas selling our jobs from the locals that don't want them either!!!
And where did you learn that? From "studies" bought and paid for by the megacorporations and the wealthy? Gee, now they wouldn't have a motive to lie, would they?
eat shiat and bark at the moon
These "Benidict Arnold" corporations, in exporting good paying jobs to other countries, will do themselves in in the long run.
These megacorps want to get away without paying US wages, while at the same time, being dependent on a US consumer-supported MARKET to sustain their product.
Dell and HP, for example, aren't selling their expensive services and products to India. They are selling them to the USA and Europe.
Therefore, outsourcers depend on EVERYONE ELSE NOT outsourcing middle-class jobs, or else their market will ultimately collapse.
It's not just the corps that are betraying the American worker. Corporations will do anything allowed by law to make a buck. I don't have a problem with that, if business didn't make money, NONE of us would have jobs.
The traitor here is our government which does NOTHING to stop this practice, nor to even discourage it. Both parties are responsible. Both parties are beholden to the corps.
John Kerry gave some lip service to stopping outsourcing, but when you look at where his fortune comes from (his wife), mainly from OFFSHORING Heinz plants, one must wonder how serious he is about it.
The problem of outsourcing, like the IP cartels (MPAA/RIAA) are enemies that we can't vote out of power because BOTH parties are under their spell.
My solution to outsourcing is very simple.
Give all American businesses a tax credit equal to the salaries of all American citizens they employ inside the USA, minus the salary of all non-US citizens employed outside the USA.
This will allow outsourcers to play by the existing rules, while giving businesses who employ Americans a tax advantage over them.
There really won't be a loss in tax revenue, as all corporate taxes are illusory (all taxes get passed on to the customer), and it will help it, as it will encourage employers to employ more people and to pay higher wages.
Corporatism != Free Market
"The claim here is that IT outsourcing is beneficial to the US as a whole, because the IT engineers in Bangalore wear Nike tenis shoes."
Oh my yes. You see, the Nike executive will make money off of the sale no matter who buys them or where they are made.
The Nike executive will then hire additional personal servants where he has established his domicile (usually the US or Bahamas).
Sure, you'll work for a pittance, and you'll be easily replacable, but think of the joy of serving a Nike executive.
Mod parent up +5 Insightful.
Though there really is nothing more amusing than a truckload of nerds getting their panties all bunched up over the fear that they will somday no longer be able to afford hundreds of dollars worth of anime pr0n each month.
"I hate to advocate drugs, alcohol, violence or insanity but they've always worked for me" - HST
The best thing america can do is make this the best place in the world to do business.
That means competitive and attractive tax rates, unobtrusive and easy to understand regulations, along with highly educated and productive employees.
Throw in things like having some of the best capital markets and banking in the world, along with unmatched goods distrubtion no matter sea,air,or land and things look good.
The answer does not lie in government intervention to protect one type of worker.
If the govt had stepped in to save 10,000 typewriter mfg jobs in the 1960's and put taxes or other restrictions to slow down the computer takeover....sure those 10,000 jobs might have been saved but it might have caused hundreds of thousands of new jobs to be lost by some other coutry(japan?) getting a head start on that market.
While govt intervention sounds good to those people affected, more often than not, anytime the govt interfears with the free market there are unseen disasterous results.
-- Given enough time and money, Microsoft will eventualy invent UNIX.
This should have been modded down as a troll, not up.
What's wrong with you people? This is such obvious flame bait.
Just don't forget the next steps.
A strong MIDDLE CLASS is needed to keep the economy of this country going.
When you have the ultra rich not paying taxes AND lobbying to pay FEWER taxes, then you have wealth concentrating in the upper levels.
Since there is a finite amount of wealth at any given time, this weakens the middle class (because the lower class doesn't have that much to lose anyway).
Over time, you see the population splitting into a few rich and lots and lots of poor. This is not good for the economy of the country.
"Do you have a retirement plan? If so, then you're a shareholder."
I raided mine to keep food on the table, and roof overhead.
"As international trade barriers fall, wealth everywhere increases."
But they haven't fallen. That's part of the problem.
The interesting thing about these vague pronouncements about China wanting to attack us is that if repeated often enough, people will think China really does want to destroy the United States.
But China is no longer Communist. It is a despotic government, to be sure, but it has no real ideological axe to grind with the US, particularly given that we have shown no interest in truly affecting their internal politics.
So aside from vague notions of "the biggest two powers must clash" can you give me any other reason to explain why any prosperous country would risk major war with another prosperous nation? The potential devastation in such an encounter is tremendous, and even a despotic leadership like China's knows better than to risk such a war.
Read the EFF's Fair Use FAQ
I am a systems and network administrator. It'd be awfully hard to outsource MY job, as there will always have to be someone at the site to diagnose, repair, design, and impliment systems and networks.
But technology will get me as well. If they ever invented the "transporter" you can be DAMN sure some US megacorp will buy (bribe) Congress to allow them to import foreign slave labor on demand.
Fortunately that's at least a century (if not more) away. At the rate we are bleeding away the tech industry with nothing else to replace it, our economy and thus, technology will be long gone by then.
High tech is the LAST wave in the industrial revolution. Thanks to greedy corps, and wacko green-nuts, we outsourced the factories 20-30 years ago. Our economic resurgance of the 80's and 90's were DIRECTLY related to the growth of the tech industry that replaced dirty industry.
Bleed those jobs away from this country, and it's over.
Corporatism != Free Market
"If Nike does better, all US-based employees of Nike, from execs down to janitors, benefit."
... well, most people won't live long enough to see the benefit.
Only if there is some mechanism in place to distribute the increased profits.
From what I've read, there is not. So not "all US-based employees of Nike" would benefit.
"Also, since anybody can buy shares in Nike, the average US citizen is free to benefit from Nike's success directly as a minor shareholder."
You're a little confused about stock. Stock costs a lot (relatively) to buy, but pays out small dividends (relatively) if at all. If it costs you $100 to get $1 (but that $1 will be every year), then it will take you 100 years
The question is are we economically vulnerable? If you consider that 2/3 of the GDP is from consumer spending then the middle class is the top economic priority. On the face of it cutting middle class wages is killing the goose that laid the golden egg. Folks argue that shoe manufacturing, electronics and other industries have moved offshore and we've survived. How to judge?
So if you take into account record deficits, a shrinking middle-class, record consumer debts in both secured and unsecured loans then deflating the middle class with offshoring doesn't make any sense. If offshoring were having any positive effect in the overall scheme of things then big picture numbers like real-wages for tech workers here would tell. For example, if off-shoring resulted in higher wages for tech workers that kept their jobs here because they wer e higher skilled, then that would be a plus. But that has not happened. Offshoring has resulted in lower wages for tech workers in the US regardless of their education or experience.
Lowering middle class wages in an economy that relies for 2/3 of its size on consumer spending is always shooting yourself in the foot because you end up with wage deflation. The question is are we vulerable to some kind collapse?
I would say from what I'm reading about macro-economics the news is mostly bad. We should stop off-shoring until the economy stabilizes.
Just my opinion of course!
P.S. Watch out for the spin. Economists will tell you that home-ownership is at an all time high. What they are also telling you is that secured debt is at an all time high and that we are living on second-mortgage borrowed time and money.
I'll believe in the benifits of outsoucing as soon as they start outsourcing CEO's. Currently some of them make over 400 times what the average worker makes. Think of all the money a company could save! Think of how much this would benifit the US economy! All of the arguments made about how IT workers make too much and if they deserve the jobs they spent years learning how to do, and years keeping up with all the advances apply equally to ALL workers, management included. Let's let blind adherence to capitalism is all good turn us ALL into poor burger flippers. Then capitalism, globalization, and free trade will have achieved what communism couldn't and turn the US into a third world country.
Which is why I posted this link. Note the dates.
I've been out of work so no taxes from me from last year. I've also drastically cut my spending so bad for businesses too. From following my past employment, the savings from letting me go went for pay raises & bonuses to the guys in charge so no businesses savings but a money shift(investors are such suckers). Whether top management has upped their US spending habits and taxes to offset my sans-spending would determine whether it's a net loss/gain.
"As others have mentioned, the stockholders also benifit, as do the consumers (if the outsourcing is handled well) or their competitors (if it is handled badly)."
But 90% of US citizens do NOT own much stock. So the "stockholders" are, in reality, the same executives making the big salaries.
The "consumers", well, the depends upon whether they can make enough money to purchase the products.
The "competitors", since they also sell a similar product, they face the same problem the "consumers" face.
"But even more important, it benifits the economies of the countries to which the jobs are outsourced, and as a consequence benifits many people who just aren't americans but are nonetheless just as real as you are."
Check that. Look at the environmental protections and the employee protections of those countries. In most cases, the reason it is cheaper to send the work over seas is because they have fewer protections. Abusing your people is one way to achieve prosperity. But it is just a race to the bottom to see who can inflict the most abuse.
Instead, why not require that any country that we outsource to have the SAME level of protections that we do?
"Every one of these people now has a personal vested interest in seeing the US stay healthy and strong, and interest in peace with the US instead of war...."
Right..... and the last time we went to war with a country we were outsourcing to was......?
They do NOT have a "personal vested interest" in the US. Just in the CORPORATIONS.
"Free trade (including outsourcing) may disrupt the status quo in complacent markets but it does far more good in the long run for both sides."
Incorrect. Handled badly (as it currently is), it will result in many countries with toxic waste dumps and increased cancer amongst their populations. Their people will still be poor, but their officials will be wealthy.
Someone with $10 MILLION spends his money a lot differently than ... ...
500 people with $20,000 each.
It's the effect on our country's economy and our tax system.
The benefits of trade are greater than the costs of trade, but the benefits are diffuse and the costs/pain are concentrated.
----- Question authority, but not ours. Hate the man, but we're not him.
The kind who got the IT jobs without going through the education I did.
I still have my job and they're gone. They're gone because they do not know their jobs.
That's the flaw in your concept. You cannot just get the education sufficient to your job today. Who is supposed to know what you'll need to know or what you'll need to do?
"I hear your arguments, but I feel you've missed the big point. American jobs are expensive. Indian ones aren't. The American Dream, capitalism, demands the jobs go abroad. You can't have it both ways."
Again, if all other factors were equal, you'd be correct. But they aren't equal.
If they WERE equal, you'd see the entire corporation moving to India.
There seem to be two dominant positions on Slashdot, and although I'm not one of these people who fails to see that Slashdot is made up with a variety of people who have a lot of different views, I think that in this case those two dominant positions are largely held simultaneously by a large percentage. Which positions do I refer to?
Here's the problem with holding those two views. Both corporate outsourcing and corporate use of open source reduce the value of an IT position. In fact, open source may even be a stronger reducer, because it's pitting the professional programmer against free instead of a low-paid Indian.
Now, personally, I don't think either open source or outsourcing are a terribly big deal. I think that in the long run, both are going to increase the world's standard of living, as they result in cheaper and more abundant software. Sure, there will be some highly (over)paid Western engineers who will suffer at the hands of Schumpeter's creative destruction, but in the end we will adapt and the world will be better off as a whole.
On the other hand, those who think holding opposing views about the value of outsourcing and open source are reconcilable, might want to think long and hard about where they really want to stand on the issue.
"If English was good enough for Jesus, it's good enough for everyone else."
Hi! A nice soundbite. But in reality life is a whole lot more complicated. Take for example education.
Education:
The Pilgrims started the notion of free publication education way back when (1600s). Part of the Protestant movement was learn to read the Bible for you own salvation. The Catholics believed you needed a priest to interpret between you and God. The Prostestants believed you were best served praying to God directly, but to interpret God you needed to read the Bible and go to the weekly sermons. To this day we still have a the notion of free public education. Many economists have tied our American brand of captilism to our socialism brand of education. The point is that the Puritans weren't trying to create the best business envirnment, they were trying create the best *living* environment. We have, and we've always had, socilized education as a result.
Flash forward to the 1960s. In the 1960s our education at the University level made a dramitic shift. Instead of four years of specialized education, liberal education was introduced for the first two years. Engineers were told they needed to learn to write and commmunicate in English. Before this revolution engineers would only take math and engineering courses. Ironically, it may be the two years of liberal, non-technical education will save many tech jobs ... because guess what? Indian people while taking remedial English classes do not take college level English. Liberal communication classes will become even more important to future tech workers here in the U.S. Now why did Universities across the country liberlize? Ultimately to make better citizens, make a better country to live in.
My point is simply this. We need to continue our tradition of making this the best place in the world to live. That will create the best business environment as a matter of course.
Environment:
Take all of our environmental laws. Initially seen bad for business, but imagine our health-care costs if we hadn't taken the steps we did to protect air and water? Children who live near coal burning power plants on the Eastern seaboard are 5 times more likely to get asthma. Is it a better business environment to have unhealthy workers? For this reason standard healthcare should be socialized similar to the education system where basic is free, university level is paid for.
Conclusion: Some people argue that socialized anything is bad for business. Obviously this is just not the case. Government intervention to educate workers throughout all our history has made us what we are. Our public works for education and environment utlimately benefit business because the create the best place to live and the best place to live is the best business environment.
So, in my opinion creating the best place on Earth to live is the proper persepctive, not just the best business environment. The best business environment is too short sighted.
#1. All of the "benefits" it cites are based upon PREDICTIONS.
#2. Those PREDICTIONS are NOT based upon previously off-shored industries.
#3. Those PREDICTIONS are based off of COMPLETELY DIFFERENT SITUATIONS. "As with agriculture a century ago, productivity gains have outstripped demand, so fewer and fewer workers are needed for manufacturing." That's the switch from an agricultural-based economy to an industrial-based economy.
#4. "Similarly, most current predictions are not as ominous as they first sound once the numbers are unpacked. Most jobs will remain unaffected altogether: close to 90 percent of jobs in the United States require geographic proximity. Such jobs include everything from retail and restaurants to marketing and personal care -- services that have to be produced and consumed locally, so outsourcing them overseas is not an option."
So we'll end up a nation of burger-flippers and butlers. Coincidently, those are the LOWEST paying jobs out there.
Yet, despite all of the EASILY SEEN FLAWS in that article, people keep trotting it out as if it were some valued bit of insight.
It's 100% pure CRAP.
The corporations are multinational. They can go anywhere. When the US becomes a has been and doesn't even have a market to sell to, then it will be abandoned.
Yep, the small businesses hire the most people, overall.
"How many jobs were outsourced? Now, looking back on history shouldn't we consider the 70s the age of outsourcing automobile workers? The 80s textile workers?"
YES! But this has been discussed before. Talk to people in the "rust belt" now.
"As for the job creation. The capital gains tax cuts and similar equalizing of the percentage of income tax benefit the small business greatly."
How? Most small businesses do NOT see much benefit from capital gains cuts. That is mostly on UNEARNED income.
You see, there are, basically, TWO types of income:
Earned - via labour
Unearned - via investments
The small businesses focus almost exclusively on the EARNED income. They make things and sell them. They provide a service for a fee.
Big businesses and rich individuals benefit from the UNEARNED portion. Stock dividends, income from selling stock, etc.
"Now what will stop this? Simple, raising the taxes on the "evil rich"."
Hardly. All that needs to be done is to focus the tax structure a bit more fairly (by "fairly", I mean "for the greatest number"). Since the majority of US citizens do NOT see much benefit from reducing taxes on UNEARNED income, then we do NOT reduce taxes on unearned income.
Since the majority of US citizens WOULD see a benefit from reducing taxes on EARNED income, then we reduce taxes on EARNED income.
"The ones with the millions and billions have relatively no income and have the means to dodge nearly most forms of taxes."
So you've fallen for the old right-wing trick, eh?
The key is to identify and remove the tax loop-holes. Then the taxes are re-structured to provide the greatest incentive for the greatest number.
The stuff you've been reading is biased. The "small businesses" you hear about include Bush and Cheney because they receive income from properties. And the "small business" rules have been setup to include that.
"Unfortunately America preaches capitalism and free market economics all the time but is very two-faced about this kind of stuff. Massive subsidies to domestic industries and sanctions against foreign industries is directly contrary to these ideals."
Yes, and the amazing thing is...we're not alone in doing this. Note that no one in this discussion is chastizing those countries. Now who's being two-faced?
Agreed. There is never a zero probability of anything where international affairs is concerned. But the parent made the assumption that war with China was a *given* not a remote possibility. There's a huge difference between the two perspectives.
Read the EFF's Fair Use FAQ
Perhaps we do not read the same economics journals, but perhaps you have heard of Paul Krugman and J. K. Gailbraith?
The pro-outsourcing arguments are as deficient as the anti-minimum-wage arguments, and for the same reason. They both assume that labor markets have the same dynamics as commodity markets. Although often persuasive on the surface, in practice, when people are making a higher wage, they are less inclined to quit, which saves training expenses, and they are more likely to work harder, increasing the value of their work. There is strong evidence that the net labor cost does not increase after reasonable increases in the minimum wage, and rock-solid evidence against increased unemployment. For example:
Telling someone that outsourcing his job will save him money is pathetic and absurd on its face."About companies keeping their inventions secret, you imply that knowledge is scarce. This is not the case, knowledge is abundant. That's the reason for the patent system, to make knowledge atrificially scarce (for the benefit of the powerful)."
Leave it to the "I hate copyrights" group to insert their agenda in an otherwise reasonable post.
Here let's test your "knowledge is abundant" argument. There's a story ahead of this one about a new application of microdots. How come you didn't discover this yourself? All you had to do was go out to the "tree of knowledge" in the backyard and pick some.
Knowledge isn't scarce, but that's only part of the story. The other part is that "discovered knowledge" is scarce. That's the part that patents and copyright were meant to facilitate.
You can rally against "big business" all you want. That's not going to either make them smaller, nor make your flawed argument correct.
They have the highest quality of life in the world, and they do just what I suggested. I am not suggesting anything radical, just do what Sweden, Denmark, et al, do.
eat shiat and bark at the moon
"But it is not a zero-sum game, even if you insist on pretending it is."
... strength/weakness ... they are all measured by comparing one instance with another instance.
...
At any instant, it is. Growth/decay
"The growth of the economy depends on said wealth being redeployed."
Again, the ECONOMY can grow in that more wealth is being generated
But that still does not mean that the MIDDLE CLASS will prosper. And without a strong middle class, the economy will fail.
"Not on it being collected by government agencies and directed to soup kitchens."
But the government is one of the primary tools for re-deployment. The government collects taxes and pays for defense / education / welfare / etc.
Therefore, WHERE the government collects taxes from is VERY IMPORTANT in the economy.
You make some good points...and I like your ideas.
The question is, why mod parent as flamebait?
-- Given enough time and money, Microsoft will eventualy invent UNIX.
"The stock purchaser collects the dividend, but retains the value of the stock itself."
And the value of the stock itself is dependant upon the market's perception of the value of that stock.
"Then, after collecting some dividends, if the company has done well in investing the purchaser's money, the value of the share of stock increases and the purchaser can sell the share for a profit if desired."
Again, the value of the stock is dependant upon the market's perception of it.
But, back to the main point, investing $100 for $1 of annual income (whether you can still sell the stock for the original $100) is NOT a viable option for most people to live on.
They will STILL need a job (again, because MOST people cannot live on their stock dividends) until they can retire and live off of their investments.
But they will NOT have that job because it has been OFF SHORED.
We got those things in the US after we industrialized, because that's when we could afford them. If we'd insisted on having that stuff first, we never could have industrialized at all. This pattern has repeated itself again and again as nations have industrialized. The USSR may be an exception, but is Stalin an example anybody wants to follow?
You're all fools anyway for talking like there's any solution to this. It's like protesting against gravity. If somebody in India can sell an equivalent product for less money, the only thing US law can do is prevent them from selling it in the US. If we seal off the US and refuse to let anybody here buy software from third-world countries, how will that stop Europeans from buying it, or Asians? It won't. It can't. There is nothing you can do.
Opening markets should be accompanied with freedom of movement and balancing social systems.
Once again, how do you plan to enforce it? Anyhow, what do you mean, "should"? Did you hear this from God? From Buddha? Or what?
The thing that makes me nervous about you people is the way you start with "it might be nice", upgrade it to "should" and then to "must", and then decide that if something must be done, then it also must be possible -- and the next thing you know, we've got something like the Cultural Revolution on our hands and millions of dead bodies all over the landscape. When some fool announces that pi "should" be equal to 3.0, I can't even bring myself to laugh any more. It's just not funny.
"It might be abuse to migrate someone from US-standard-of-living (call it 10) to the outsource-worker-standard (call it 4), but what we are talking about is taking people who often are living well below the poverty line (1-2 on the same scale) and raising their livel of income to something that (while we might find it beneith our dignity to accept) is still far above what they could otherwise expect."
So, it's okay to exploit people if they see some slight benefit from the exploitation?
Well then. Thailand's sex tourism industry would be a "good thing" in your view. After all, those girls and boys get to eat and wear nice clothes (part of the time). That's definately a couple of steps up from living in complete poverty.
"I supose you might think it less cruel to just let people starve instead of helping them earn enough money to buy food and clothing (but not iced-coffee-drinks and laptop computers). But I think it's a step in the right direction."
While I believe that it is a transparent attempt to justify your greed. There is no reason (aside from PROFIT) why the US corporations could not provide the same level of worker and environmental protections in those countries that are required here.
"Because this is argument is just a protectionist strawman?"
Hardly. The reason the labour is cheaper over there is because they start of at a lower standard of living (as you noted) AND THEY DO NOT GAIN OUR PROTECTIONS.
I'm all for "free trade" as long as both sides have the same levels of protection.
Otherwise, you end up with the same situation as Thailand's sex tourism industry. Justified exploitation because the victim's lives are slightly better from a materialistic point of view.
Free trade requires equal protections.
will seriously decrease the popularity of outsourcing. Once a phone call to the Help Desk yields not even a dialtone, U.S. software developers will once again command high wages (that is, until enough Chinese programmers learn English, whereupon the cycle will repeat).
Kid, you're dead wrong in so many ways about so many things, it ain't even funny.
you do $90k worth of work for 10 years...then the company takes the profits from YOUR work and builds the NEW office overseas...
You SELL the company your work for US$90k per year. They turn around and sell it to somebody else, but that's none of your damn business, because you SOLD them the work. It's theirs now.
If you want to retain ownership of your code, if you want to own the profits, you'll have to go into business for yourself, float the risk (or find investors), do the bookkeeping and paperwork, find customers, sell them the product, and so on. Too lazy for all that? Not clever enough to run a business? Right! That's why you work for somebody else. That lack of energy and ability is the only reason you can't start your own damn company and run it exactly as you please (until it goes into receivership, anyway).
The company probably didn't build an office overseas. They probably contracted with an Indian-owned company in Bangalore which takes care of its own office space.
Even if they did build an office overseas, they could very easily borrow the money.
India's a democracy, the world's largest. Not a perfectly ideal, flawless democracy, but above average.
Considering cost of living, a fair wage in Bangalore is not the same as a fair wage in San Jose. The tech boom in India is having a dramatically positive effect on standards of living, and that's a fact.
In most cases companies are spending MORE money on outsorcing and reaping far short of the returns they're supposed to...
If that's the case, it won't continue. You're bitching about how they're doing this only to maximize profits, and now you say that they're actually losing money on the deal -- well, if their only motive is to make more money, and they end up making less money this way, why the fuck would they go on doing it?
I suspect you're just whistling in the dark there, but time will tell. Offshoring does in fact have some problems: It's hard to coordinate a team spread out over two hemispheres. On the other hand, Indian tech workers generally speak English considerably better than the average native English speaker on Slashdot, so they've got that in their favor.
So do you think we should stop companies from using new technology, computers, robotics, and other machines that replace workers? I mean, jobs are not just outsourced to other countries. They are outsourced to machines. Maybe we should go back to living on the farm and working the land by hand. There would be more equaly payed jobs for everyone.
Hi!
My guess is is that the moderator only read your sig. I personally am not a moderator on slashdot.
Just for the record, I want to see more skilled and better paying jobs in the US. 90% of the population working in a "service industry" (hey, prostitution is a "service industry") is bad for that 90% and for the USofA.
Yep, my salary is "grossly inflated" by their standards. But I'd still prefer that our government get itself straightened out and realize that having MORE skilled people in the middle middle class would be a "good thing" (tm).
"Perhaps that's so in your perfect world."
Ummm, that "perfect world" is the one we live in. Whether you realize it or not. The US government collects a LOT of money in taxes and spends a LOT MORE money.
If that doesn't meat the definition of "re-deployment" then I think you have a problem with your definitions.
"I view government meddling in the economy as an unfortunate side effect at best."
Whatever. The government needs money to operate (pay the military / fund education / social security / welfare / etc) so WHERE that money is collected will ALWAYS result in "meddling in the economy".
OH NOES! The label! It does not fit me!
This is the problem with America's party politics. You're stuck with some bullshit label. What are you if you're socially liberal and fiscally conservative? Fucked, according to stupid shits like you who can't find the mental capacity to comprehend things that aren't easily labelled for your drooling pleasure.
So yeah. Give me my porn and freedoms, and quit fucking with my job.
By the way, you stupid little fuck, didn't you know that the libertarians don't have a stance on personal anything? The entire party exists only to appease corporate whores, and they could care less about censorship and copyright controls, as long as the companies kept on raking in the dough.
There may be creativity in the other country, but that's not outsourcing.
So wait, if my company fires its entire R&D staff and hires people in another country, thats not outsourcing because
A) its "creative"
B) Instead of calling it R&D its now D&R
C) The little fairy told me so
D) Oh wait, it IS outsourcing!
The current administration gets its outsourcing numbers from voluntary reports from companies who do so. And there are companies that cut entire departments, only to later create entirely new divisons that have the exact same purpose, but with a different title so its clearly not outsourcing. Just how much underreporting is going on, considering the current backlash against the behavior?
If I have been able to see further than others, it is because I bought a pair of binoculars.
Ignoring your whole "think of the children!" rant (and, frankly, while I'm not at all in favour of it as an industry, if my choices were starvation and prostitution I know which one I'd pick) you are still twisting things badly. For example: My greed? I'm a worker in the very industry (IT) that everyone is screaming about offshoring. And guess what? I can't command the outragous sallery I was getting six years ago, but I'm willing to put up with a drop in income because in the long run I think everyone (not just Americans like me) will be better off. I support offshoring even though it has a negiative impact on me personally.
How exactly is this "greed"?
For your other point, it actually costs more to offshore, all other things being equal. The only reason it happens is that "all other things" aren't equal. Requiring that they be equal is an underhanded way of saying "offshoring should be prohibited" without being honest about your goals.
-- MarkusQ
I'm not saying "almost all economists" lightly. Surveys show that over 90% of economists favor free trade, and few see any distinction between offshore outsourcing and other international trade.
I don't know what J. K. Galbraith has said about outsourcing.
Forgive me if I didn't make this clear.
If your company "hires creative people" in the other country who do not work directly for your company but for a firm based there who allocates them as needed to your company, clearly that's outsourcing. I say its not likely to be very successfull for the reasons I've given.
If your company hires a company to provide a creative solution in another country, that's no different from hiring a similar company here - simply harder to manage. I don't call that outsourcing in the same sense, no.
What you CAN'T do well with outsourcing, is pay a remote firm who has people hired as "body count" to perform an essentially creative task. It will fail.
The problem with quotes on the internet, is that nobody bothers to check their veracity. -- Abraham Lincoln
We can globalize the social structures...
What if the government of, say, Zambia doesn't feel like taking orders from you? Exporting our laws means exporting our political system. That's called "occupation". You're talking about the US, Canada, Europe, and Japan seizing control of every other government on Earth, by force. "For their own good". Yes, of course. It's always "for their own good", isn't it? "Lesser breeds without the Law", and all that? Let's "help" all those poor benighted children who can't even run their own economies to Znork's standards. Let's help 'em good and proper. The survivors will thank us, I'm sure.
You think the mess in Iraq is a nightmare? Try doing the same with all of Africa, central Asia, East Asia, Indonesia, all of South and Central America... Yeah, right. No, wait, I left South Korea and Taiwan off the "first world" list, not to mention Australia and New Zealand. Maybe that'll tip the balance!
Pi. Does. Not. Equal. Three. Point. Zero.
It's a fact.
"Ignoring your whole "think of the children!" rant (and, frankly, while I'm not at all in favour of it as an industry, if my choices were starvation and prostitution I know which one I'd pick) you are still twisting things badly. For example:"
... as long as the corporations operate with the same level of worker and environmental protections as are required here.
It's a valid example. It meets all of your statements AND it is a documented fact.
The issue is NOT "starvation" vs prostitution.
The issue is development vs exploitation.
"How exactly is this "greed"?"
DUH! Because it places the profits above the welfare of the worker. That's "greed".
"For your other point, it actually costs more to offshore, all other things being equal."
Ummmmm, maybe you MISSED THE PART WHERE I SAID THE OTHER STUFF IS NOT EQUAL.
Again, here's what I specifically stated:
"Hardly. The reason the labour is cheaper over there is because they start of at a lower standard of living (as you noted) AND THEY DO NOT GAIN OUR PROTECTIONS."
Did you miss that again? Maybe you need it one more time?
"Hardly. The reason the labour is cheaper over there is because they start of at a lower standard of living (as you noted) AND THEY DO NOT GAIN OUR PROTECTIONS."
"The only reason it happens is that "all other things" aren't equal."
Well, it's good to see that I finally got that through you head.
"Requiring that they be equal is an underhanded way of saying "offshoring should be prohibited" without being honest about your goals."
What was that I said about "greed"?
When the PROFIT motive outweighs the PROTECTIONS, it is greed.
You don't seem to agree with that, but it keeps coming back to that.
Off-shoring is just fine
I didn't say it should be illegal.
If those protections are a good idea here, why not there? Your "point" is that it would COST MORE if it was required (hmmm, "cost more", but it isn't about greed).
The protections we have add to the cost of employing us. If business is allowed to move production to avoid those protections, then it is the same race-to-the-bottom that everyone else has been pointing out.
Which gets back to my example of Thailand's sex tourism industry. By your "logic", that's a fine example of "helping" the local girls and boys.
I say that is pure exploitation and claiming that their lives are slightly better in a material fashion is nothing more than attempts at justifying your greed.
Otherwise, we'd be operating under the same protections there as we do here.
what happens if china declares war?
if what you said about moving expertise does happen, america will be paying china enough money so that by creating a conflict w/ america, china will have in effect shot itself in the foot (econmically speaking).
do you think the saudi arabian government (not the tiny radical groups) will begin a war with the US and risk losing all the oil based income we're providing. look at it this way... if we didn't trade with any nations at all then they wouldn't have any reason NOT to go to war with us outside just being nice. however, if we're putting money in their pockets they're likely to be a little friendly (at least enough so that we keep on trading).
Wired magazine had an interesting article about outsourcing I read on a flight a while back from a IT training course. The article is titled "The new face of the Silicon Age" and it addresses what some analysts say is needed to overcome outsourcing from the U.S.
Their approach seems to be along the lines of the workers in the U.S. being the designers with the the outsourced workers building off the designs. This isn't always a good approach for obvious reasons, but the overall tone suggests that there is a push for more of a creative aspect for US workers and less detail and end product development being done here.
Being in the IT industry myself, I find this a bit disturbing. Most engineers employed in IT focus on architecture of designs, but then the detailed work and support of their designs becomes the real task. Once you pull together an idea, making it happen and supporting it is where the real work comes in. Is it a good idea to focus solely on the first step. Once you loose touch of the detail and support aspects, it's only a matter of time before you loose all of it. After all it's very conceded for engineers in the US to try and think they are the only ones who can create great things as the wired article mentioned seems to imply.
root 10956 5164 0 Oct 22 - 0:23 sendmail: rejecting connections: load average: 70 (isn't sendmail just too kind)
Up until this point, the software industry has been making what economists call "abnormal profits". In general, those profits have been pretty good for the economy, and really good for the software developers who have been able to see a large chunk of those abnormal profits, due to their relative scarcity. Unfortunately, abnormal profits are unsustainable. Eventually, someone will notice that you're making a lot of money and decide to get their own piece of the action. Then someone else will notice, and someone else, and so on. As more people enter the market, the profits go down. That's the case with the software industry. The abnormal profits are coming to an end, but the software developers continue to expect to make their chunk of those high profit margins. That, coupled with the fact that way too many people have entered the software development field, looking for unsustainable margins, means that there is going to be high unemployment in the field for a while.
The deflation of the current abnormal profits is exacerbated by high availability of cheap outsourcing labor, and the unwillingness of software developers to compromise on their high salaries. In time, though, things are going to settle down, and we may find that outsourcing was not a bad thing, but instead a spark that will trigger an even greater period of Western technology output, as the Western labor force shifts into new fields. Of course, we may fail to make the shift and slip into irrelevance, but I don't think that's too likely. There are too many great (and incredibly well-educated) minds in the west to sit back and stop innovating. The new innovations will occur, and those innovations will create new opportunities in the west, while India and others use the advantages they are getting from outsourcing to cultivate their own minds, which will eventually lead to a surge in native innovation out of those countries, which will complement the innovation of the West and improve us all. In the meantime, they will begin outsourcing the jobs that their improving economy will be come unable to sustain, to other countries that are now reaching a fledgling state that can support those jobs, while using them to improve...repeat ad nauseum.
Of course, the more trade barriers we remove, the faster this will all occur---much of it we could see in our lifetime. Additionally, widespread democracy will add to much to the opportunity available.
Far from seeing this time as a dark time teetering on the edge of the abyss, I think that we are right now poised on the edge of a new golden age of globalism---if we can get over the rough spots without panicking.
"If English was good enough for Jesus, it's good enough for everyone else."
I'm willing to admit that Krugman was probably in favor of outsourcing in the 1998 time-frame, when job creation was fast outpacing labor force growth, leading to potentially inflationary pressure on salaries.
No, because, for example, that would be completely impractical and totally ignored.
However, every community has the right to regulate its labor market. If you want the benefit of living here, then you may have to give up the right to unlimited use of foreign labor.
My teenage daughter might want to employ a Swedish band for her slumber party entertainment, but even if she could afford to hire them, as long as it's my house, I have the right to say no.
workers move into U.S., and they will work on a fraction of your salary.
If they're paying for food and rent in the US, it'll have to be a rather large fraction of your salary.
The thing folks don't "get" here is that "cheap" workers in Bangalore aren't living in Manhattan at Bangalore salaries. They're living in Bangalore.
As jobs and money move more freely across borders, we're going to find that places like Bangalore will become more affluent, so the "arbitrage" of outsourcing, which works because dollars are worth a lot more in Bangalore than in the US, won't work as well -- because that difference in the value of dollars will decrease (the scarcity value of dollars will diminish as dollars become more common; some people call this "inflation"). The cost of living in Bangalore will rise. If the US becomes poorer either as a result of all this or for some other reason, the cost of living in the US will drop (when the folks in India have enough of our dollars, the scarcity value of your dollars at home will increase: the same piece of green paper will buy more stuff). When the two values of the dollar meet, there will (obviously) be no benefit to be derived from outsourcing. By then, of course, we may all be living in caves and therefore unable to do the work, but that seems like an alarmist scenario.
Hey, young dudes, tell me in 10 years what you think about offshoring...when the Engineering & IT Proffession have been reduced to domestic serfdom! Mod it to "Flamebait" if you are so compelled - just remember what I said. AMF!
... as soon as she mentions that the Swedish band cost peanuts in comparison with the alternatives, you will immediately agree without any more complaints.
Not that your analogy holds any water, economic imperatives do not have morals and impose its reality on dumb goverments that try their hand at protectionism.
IANAL but write like a drunk one.
Telling someone that outsourcing his job will save him money is pathetic and absurd on its face.
+1 Best summary. :)
It would be impractical the same way paying more for local labor is impracticle. I was not discussing wheter the US had the right to do it. They do have the right. But is it really advantagous??? Probably not more advantagous than forbiding the use of technology. Yes it would make more jobs, but it would make life harder for anyone.
It's not good. It's not bad. Deal with it.
What I spoke of here is called the "multiplier effect", which is a Keynesian concept. John Maynard Keynes's work is what all modern liberal economic theory (since the Great Depression) is based on. He also came up with tax-and-spend economics, and argued that the multiplier effect combined with tax-and-spend policy would do a lot of good.
Wikipedia has a very informative section on Keynesian economics here: http://en.wikipedia.org/wiki/Keynesian_economics
Because their taxes pay our welfare cheques! Hooray!
In the last 100 years, how many billion trillions has the USA spent protecting foreign governments? And many millions of lives has the USA lost?
And what does the USA get for a thank you? Another obnoxious "fuck off!" From another USA hating idiot.
I say, next time the USA should not interfer. The USA has nukes up the wah-zoo. Next time some 3rd-world sh!t-port tries to directly screw with the USA, just push a button - problem solved.
As for protecting Korea, Israel, Germany, Japan, etc. Forget it. The USA has it's own problems. They just hate the USA for it's "interference" anyway.
The USA is *not* causing those starving children. It's their own idiotic and immoral governments.
No country in the history of mankind has accumulated as much wealth and power as the USA, and used it as benevolently. If you want to dispute this, name the country that has done better.
I'm not saying the USA is always unselfish. But don't blame the USA for corrupt 3rd world governments. Essecially when, in cases where the USA does something to change those governements, you start screaming and crying about the USA interfering.
Yes, that is the motto of communism.
But, you have not seen communism in Soviet Russia, nor in China. You saw the dictatorship of the proletariat hijacked to become a straight-up dictatorship.
Please do not assume the above is a defence of communism. I do not believe that communism works well with the current revision of humanity.
emt 377 emt 4
This is Congressional testimony from the Dept of Professional Employees... Technology companies are laying off American workers from high-paying desirable jobs while they add thousands of jobs overseas. Corporations are shifting jobs in call centers, accounting, engineering, computer, and financial services offshore, among others. Some local and state governments have even begun to outsource administrative jobs, which is an outrageous misuse of taxpayers' dollars. The use of cheaper foreign labor has already had a negative impact on U.S. wages in certain sectors. According to Sharon Marsh Roberts, chair of the government relations committee of the Independent Computer Consultants Association, outsourcing has forced down hourly rates by 10 percent to 40 percent for many U.S. computer consultants . If an advanced degree, years of experience, and excellent work habits are not enough to land a job, and the U.S. comparative advantage in services and high tech has seriously eroded, what does the future of work look like for the United States? http://www.rescueamericanjobs.org/articles/index.p hp?info=offshore-outsourcing-erodes-comparative-ad vantage
[I am a s/w engg. in bangalore and I don't wear nike shoes.]
Outsourcing is way of life in india since generations, whether its getting ur car daily washed,utensils cleaned,shoes polished,your dog taken for a walk or your clothes ironed. And most people don't find anything wrong about it here in India, as I would rather spend my time doing something creative or innovative when people are there to pick up after me, and get paid for it. I don't have much praise for the kind of work outsourced to india; maybe only 10-15% are creative r&d stuff, but most are routine maintenance work(code monkeying).
So, instead of complaining, I would rather recommenend my american counterparts to invest more of their time,energy and finance into innovative ideas,as it has always been with America, while code monkeys in India pick up after you.
Tell my brother-in-law how good the offshore move was for him and his family when they have lost their house, car and various other things. His response is the title.
~. Tank you
Hasn't anyone considered that this is a new form of 'Dumping'? Instead of flooding the market place with cheap tires, memory, electronics, etc.; the Market Place is now flooded with Millions, and I mean MILLIONS of Employees. So as a voting tax payer I'm suppose to eat this and roll over? I don't think so.
It's good if workers can also follow the jobs overseas. Currently the work can go overseas but the workers have to stay in this one country.
Amen, sibling!
What right do those CEO's have to those salaries?
emt 377 emt 4
"Government does not need money for social programs. It should not be dispensing social programs. It is not good at it. The market place can do the same thing more efficiently and can serve needs better and faster."
If that were so then why is it not happening?
"Government is needed to provide a common defense (not an active offense). Government should not interfere with the internal politics of other nations. Government need not enter military alliances and treaties."
It is easier and cheaper to build mutual defense alliances than to pay for your own huge army. Again, taxes must be collected to pay for that army and how those taxes are collect will be "meddling".
"Government need not mandate education. Education is best controlled by local communities and by parents, not by whoever gains political power."
Again, if that were so then why is it not happening? Nothing prevents parents from educating their children. But few seem to do so.