Slashdot Mirror
Paul Samuelson Challenges Outsourcing
Noryungi writes "Paul A. Samuelson, Nobel Laureate in Economics, a professor at MIT challenges the outsourcing of jobs (retinal scan login required) to India and China. Choice quote: To put things in simplified terms, he explained in the interview, being able to purchase groceries 20 percent cheaper at Wal-Mart does not necessarily make up for the wage losses."
The western world as a whole is sadly losing more and more of it's technilogical, educational, economincal, and advantages by succumbing to the short-sighted benefits of outsourcing.
What does America produce anymore? What does any other Western country produce? Food? Consumers? It is Very depressing watching this trend. It's more depressing watching my father-in-law, a damn hard working family man lose his job just because he's getting older to some unskilled person outside of my country.
I could go on, but I'm not trying to start a flame..
"It's not stealing if you don't get caught!"
I was reading the english translation of a Japanese business plan (Orient Watch Compant), and the Japanese word for 'outsourcing' was translated into English as "Hollowing-out."
It's an interesting viewpoint: The English word 'outsourcing' imploys that it's just a business transaction - while the Japanese translator used a phrase that has connotations of taking out the core of a business and discarding it.
Perhaps - there's some truth in that idea.
Moneyed corporations, non-working 'poor' and criminal prisoners are turning productive citizens into tax-slaves.
They've been saying this in California for awhile
Let's not forget that Dell brought back one of its call centers from India due to excessive customer complaints. I've also read that the lower cost of labor overseas is often outweighed by lack of individual action, time zone differences and culturally-caused communication problems. I've heard from several people in ATSI (a telecommunications association) that some clients came back after getting really poor results from offshoring.
Simply put, offshoring is not as clear-cut as everyone makes it out to be once you take in a lot of intangebles. I don't worry too much about it because, sooner or later, the inflation in wages will make offshoring too expensive to consider. It's already made India much less attractive as the one-time costs are taking longer to recoup.
There is a difference between "insightful" and "inciteful" other than spelling.
In their paper, Mr. Bhagwati and his co-authors write that such an assessment of the education systems of India and China "almost borders on the ludicrous." In an interview, Mr. Bhagwati said, "You have a lot of people, but that doesn't mean they are qualified.
The problem is that management doesn't seem to care if they're qualified or not. If they can save a buck (or many bucks in this case) they seem to overlook the qualifications.
Some of the jobs being offshored would have lots of requirements stated in explicit detail if advertised here in the US (such that it would be virtually impossible to find anyone who has all of the required skills) , but when they're sent to India those requirements tend to get overlooked... "You've got a BSCS from Bangalore Uni - you're hired!"
The thinking on management's part seems to be that they can make up for lack of technical skills by throwing more (cheap by US standards) bodies at the problem.
Eventually they'll realize that this doesn't work (and anecdotal evidence suggests that this is already beginning to happen).
Why not allow people to move whereever they want, and force the corporations to stay inside national borders? Wouldn't this be a more sensible approach to "globalization"? Instead we allow corporations to move wherever they want, and lock people up inside borders.
Is the idea of a person even a concept in your theory of economics? Or, in your theory, are people invisible, with the focus on profits, raw materials in one end, and manufactured goods on the other side? It's something to think about, when a theory allows for certain things to remain invisible, it tells you a lot about what the creator of that theory thinks is important. That's why our economy is said to be in a "recovery" while most people continue to do worse. Our economists don't have a concept for people in their theory, the measurement is of profits. So, if profits are up, but lots of people are starving, then it's still a recovery. This should give you insight into what classical economics is all about. It's a theory designed to decrease one's understanding of what is really going on.
Take a look at how they view corporate workplaces. According to them, raw materials go in, and consumable goods come out. They fail to notice that people go in, and people come out. People come in energized, they go out, exhausted. They might come in with two arms, and come out, perhaps with one. Economies transform people, and mold and shape them. They might come in humble, and ready to help the world, and go out the other side, a jaded, arrogant CEO. The problem is, if our concept of economic institutions doesn't measure the effects of those institutions on people, the air, the envionrment, etc., then our theory will hide all of the negative effects of corporations. Not to mention, that if we fail to take into account all of the effects of our production institutions, then prices will be grossly distored.
What exactly does a globalized economy mean, when people aren't allowed to usurp barriers that corporations can pass through like thin air? Can we call that a globalized economy?
Any place where the price of real estate consistently outpaces income is setting itself up for cost disadvantages. This has long been true in the coastal metro areas of the USA, and is now happening in non-metro areas, such as San Luis Obispo.
In 1969, my parents sold a nearly new 3 bedroom house in rural New York state and bought a new 4 bedroom house in a San Diego, CA, suburb for the same price. In both cases he could, as a high school graduate of no academic distinction who held a factory foreman's job, obtain a loan of about 2.5 times his gross pay. His commute to work was about 1/2 hour.
In 2002, in the Bay Area, with a tech masters degree, I'm limited in choice to a one bedroom condo with an 80 minute commute. Homes are available, but only to those with astonishing credit who are willing to live with the fear that comes with a 2% down payment and 'creative' financing.
Spiraling land values should be regarded as a crime, because they force startups to locate away from research universities.
The clearance system sounds logical. It is not. It is completely arbitrary. -- John Bolton
Actually, getting people to sit there and be bored for 8 hours a day without rebelling is a tough task. It generally takes about 12 years to get a human being to behave in this way.
I know you aren't being serious. But, setting that aside for a moment, if I really were effective, more would be happening than merely getting flamed on slashdot. There's plenty of history that shows what happens to people when they are too effective, as in Martin Luther King, Malcom X, etc. Part of the solution to this is of course realizing that we need to avoid the cult of personality that gives one leader all the power. That's why people like Chomsky can't stand being given all the credit when he gives a lecture. The only reason people like Noam can do what he does, is because large groups of people support his work, and he has repeated that fact over and over. Understanding this is part of how we fight the illusion that we need great leaders (or the US military for that matter) to come save us.
Also, the majority of people are already discontent. There's a reason you get slow service at your local McDonald's. They know they're getting screwed. They just haven't figured out what to do about it, yet.