Slashdot Mirror
President Defends Global Outsourcing
mytrip wrote to mention a New York Times article discussing President Bush's trip to the Indian subcontinent. There, he urged Americans to welcome global competition for their jobs. From the article: "Mr. Bush, reiterating a theme of his trip, strongly defended the outsourcing of American jobs to India as the reality of a global economy, and said that the United States should instead focus on India as a vital new market for American goods ... 'The classic opportunity for our American farmers and entrepreneurs and small businesses to understand is there is a 300 million-person market of middle class citizens here in India, and that if we can make a product they want, that it becomes viable,'"
How many of you are making more money because of all the people in China, India, and other cheap-labor locales, who buy stuff that you produce? To vote, Click here
Now, how many of you know somebody who lost their job because of overseas competition? To vote, Click here
Based on that unscientific survey, I'd say that George Bush is talking smack. The only people who really benefit from offshoring are the business owners who can costs by firing American workers and replacing them with cheap overseas labor. There may be more wealth, but it's all concentrated in a few hands.
Bush can't understand what's it's like for an ordinary family to suffer the devastation of unemployment because he's never lived through it.
Perhaps we should offer someone in India the job of American President for 1/10 of the salary he makes. Then we'll see how much he supports it.
It's like sex, except I'm having it!
If you want a free market you have to accept the consequences.
Religion for nerds. Stuff that really matters
What becomes viable? Almost any manufactured product the Indian middle class want can be made in India less expensively than the US can make it. If the Indians can't do it, the Chinese will do it for them.
I can envisage US companies making products in Asia for sale in Asia, with the profits coming back to the US companies. The only people in the US who will benefit are the owners of the companies who do are successful doing this.
It looks to me like Bush is one more pushing the "increased business profits are good for my friends" line. I'm not sure how the average US citizen will benefit from this strategy.
VA Software in Fremont, Calif., a provider of software, information and community support to IT managers and development professionals, keeps core, business-critical work at home, according to Colin Bodell, CTO. "Work that benefits from close proximity to our customers stays in the U.S. Work that can be done anywhere is typically sent to India," he says.
Bottom line: Slashdot's parent company and President Bush are on the same boat on this one. Editors shouldn't ignore or forget that.
Just lately here in Ontario (Canada), a bunch of manufacturing jobs disappeared. I am unaffected by it, since I work as a software developer. When the local politicians spin it as opportunity to grow towards more of a service workforce from a manufacturing one, I listen and agree... but when the bubble burst for dot-coms, I couldn't care less what they said, I was worried about my future employment.
Long story short, those unaffected by outsourcing directly will agree with Bush's view that there is a market to sell other goods (that are not already outsourced to India), and that is good for the country. Those affected by the outsourcing won't give a shit about a new market, and only care about their lost job/income/life.
---
Programming is like sex... Make one mistake and support it the rest of your life.
Too many people will either object because its Bush or object because they feel entitled to their job.
The fact is the world doesn't care. We either compete to win or we lose. If all you are willing to do is bitch about Bush or your employer (or usually the case - portraying yourself as victim even though it happened to someone else) then your going to lose.
The world economy is such fun. It doesn't care what you think and it don't care what you think your entitled to. Accept it and then deal with.
* Winners compare their achievements to their goals, losers compare theirs to that of others.
For the industry many Slashdotters, including myself, work in, the situation has changed since the 1990's.
1990's - Indian programmers programmed for major US corporations in the US.
2000's - Indian programmers program for major US corporations in India.
The evolution of the internet made this possible and will also make this impossible to stop.
The reality is that as the economy becomes global, Americans are going to loose money. Americans have been profiting off other countries poverty for so long that we have come to expect a certain level of (undeserved) wealth. As the global economy starts to balance out, the United States economy has nowhere to go but down.
Why would a chinese or indian buy an American product when they can buy something made in their own country by people making one tenth what our workers make?
Globalization works great for the rich people. It forces their entire workforce to take pay and benefit cuts in order to eek out a living. At the same time, the people who sit on the top of the pile are getting tax cuts and crying about how unfair it is that they be asked to contribute anything to the society that made them rich in the first place.
Again, this shows that Bush and his ilk have no connection with the citizens of this country.
-All that is gold does not glitter - Tolkien
www.ra
It's not about trading what one has in surplus. The theory is that one trades in the goods in which one has a comparative advantage. That is, you trade in the goods that cost you the least to produce.
A surplus of a particular good will end up being eliminated by market forces. If the supply exceeds the demand, then the price will lower until there is no more surplus.
Cyric Zndovzny at your service.
1) We would not be making the products. They would. We will be changing bedpans, learning to be lawyers, or teaching snot nosed brats how to change bed pans. The only Americans in the value stream are the owners.
2) A global economy only means more money for shareholders, not joe blow. If his job needs to go overseas, he's pumping gas to whoever is left that can afford a car.
3) What the fuck do we care about India (or China)? They don't pay our taxes. They aren't getting shot at in Iraq. That they don't like Pakistan is really the only useful thing about them. They didn't vote for Dubya, hell not even half of us did.
4) Their workers cannot compete fairly against american workers, owing largely to property values in the US. Ever try to buy a small house near San Jose? 50 year mortgage ring a bell?
5) US dollars invested overseas are not ending up in american hands. They're ending up in India. How is that good for us?
6) Why should US children bother to learn math or science? There will be no jobs utilizing those skills. Instead they should be learning history, deceit and bed pan frisbee.
7) Who is going to be left to build and design missiles, aircraft, tanks, and navy ships if our unskilled factory jobs are done elsewhere, and all our highly skilled design jobs are done elsewhere? Oh that's right, we have a great track record of peace lately.
8) The only thing keeping the investors in the US is the relative safety, uncorrupt government (by comparison), and generally complacent populace. If they start getting hungry they will get angry, and have no problem shooting your ass.
how the often libertarian gestalt of Slashdot suddenly advocates government-sponsored trade protectionism as soon as the topic of *computer-related* jobs comes up. Farm subsidies are economically inefficient, and they distort the true price of food. The same thing is true of the oil industry. Why can't the government get smart and start allowing non-distorted prices for gasoline?! Obviously the government is in the hands of special interests. Ah, but then the subject of outsourcing comes up, and the tech industry is under threat and in need of assistance!
There's clear hypocrisy at play here. We want competition and open markets, we want global cooperation in open source software development, we just don't want to give up top dog status in areas that directly affect our jobs.
Made in China is fine and programming in India is fine, as long as the price of laptops keeps dropping. When a product is even a few dollars more expensive than average, Slashdotters are more than willing to scream and yell about it. Well, lower prices are the result of global markets. More buyers, more sources of cheap production.
We'd rather get cheap, well-made goods and donate to aid organizations than truly allow developing economies to compete with us.
Read the EFF's Fair Use FAQ
Ya' know, I'm starting to think that Bush finally figured out that he no longer has to worry about getting reelected. When controversial stuff like the Dubai port deal and Indian nuclear power come out on the news, he hardly even defends his position any more. He just does whatever he feels like.
The mask is off. Now we get to meet the real Dubya.
Have you ever wondered How to Take Over
On the surface, this seems logical, and is often the first argument made by proponents of this emerging 'global economy'. Bush's own reference to tapping the growing indian 'middle class' play on this very argument.
However, do a little googling on 'indian middle class' and you'll find that the US equivilent wage to lead a nice middle class life in India is placed somwhere (depending on the year and on the study) between $6,000 and $15,000 per year.
I'm no isolationist, but there is a serious catch here that noone on either side of the issue is directly addressing - I live in a place where it takes at least $40,000 to 50,000 to lead a nice middle class life. What can I possibly produce that would generate that income from a market in India? As other posters here have already alluded to, the indian middle class will get a much better deal from Indian (or Chinese, etc) produced goods.
In the end, U.S. workers can't compete until the cost of living differences, as well as the differences in currency valuation flatten out. Globalization will innevitably lead to this flattening, but the upheaval in the US, with its relatively high costs and current currency valuations, will be severe, I expect the ranks of the working poor to swell massively, with consequences that, so far, I have yet to hear any politician (or economist) deal with honestly.
"That naive cube! How long must I suffer this!" --Sheldon J. Plankton
Almost anything we make can be made cheaper in China or even India.
And as time goes by, more manufacturing will be moved there.
This isn't about DIFFERENT products. There aren't any different products. I can outfit an entire house at WalMart and almost all of their stuff is imported from China. So any country that would be a consumer of our products would be smarter to just get those same products from China. We do.
I'm in favour of a global economy, but not in the way it is being done.
Right now, we're in a race to the bottom because we aren't putting any barriers on countries without the same worker protections or environmental protections that we have.
Rather than dragging us down, we need to bring them up.
Published on Monday, February 27, 2006 by CommonDreams.org
When Americans No Longer Own America
by Thom Hartmann
The Dubai Ports World deal is waking Americans up to a painful reality: So-called "conservatives" and "flat world" globalists have bankrupted our nation for their own bag of silver, and in the process are selling off America.
Through a combination of the "Fast Track" authority pushed for by Reagan and GHW Bush, sweetheart trade deals involving "most favored nation status" for dictatorships like China, and Clinton pushing us into NAFTA and the WTO (via GATT), we've abandoned the principles of tariff-based trade that built American industry and kept us strong for over 200 years.
The old concept was that if there was a dollar's worth of labor in a pair of shoes made in the USA, and somebody wanted to import shoes from China where there may only be ten cents worth of labor in those shoes, we'd level the playing field for labor by putting a 90-cent import tariff on each pair of shoes. Companies could choose to make their products here or overseas, but the ultimate cost of labor would be the same.
Then came the flat-worlders, led by misguided true believers and promoted by multinational corporations. Do away with those tariffs, they said, because they "restrain trade." Let everything in, and tax nothing. The result has been an explosion of cheap goods coming into our nation, and the loss of millions of good manufacturing jobs and thousands of manufacturing companies. Entire industry sectors have been wiped out.
These policies have kneecapped the American middle class. Our nation's largest employer has gone from being the unionized General Motors to the poverty-wages Wal-Mart. Americans have gone from having a net savings rate around 10 percent in the 1970s to a minus .5 percent in 2005 - meaning that they're going into debt or selling off their assets just to maintain their lifestyle.
At the same time, federal policy has been to do the same thing at a national level. Because our so-called "free trade" policies have left us with an over $700 billion annual trade deficit, other countries are sitting on huge piles of the dollars we gave them to buy their stuff (via Wal-Mart and other "low cost" retailers). But we no longer manufacture anything they want to buy with those dollars.
So instead of buying our manufactured goods, they are doing what we used to do with Third World nations - they are buying us, the USA, chunk by chunk. In particular, they want to buy things in America that will continue to produce profits, and then to take those profits overseas where they're invested to make other nations strong. The "things" they're buying are, by and large, corporations, utilities, and natural resources.
Back in the pre-Reagan days, American companies made profits that were distributed among Americans. They used their profits to build more factories, or diversify into other businesses. The profits stayed in America.
Today, foreigners awash with our consumer dollars are on a two-decades-long buying spree. The UK's BP bought Amoco for $48 billion - now Amoco's profits go to England. Deutsche Telekom bought VoiceStream Wireless, so their profits go to Germany, which is where most of the profits from Random House, Allied Signal, Chrysler, Doubleday, Cyprus Amax's US Coal Mining Operations, GTE/Sylvania, and Westinghouse's Power Generation profits go as well. Ralston Purina's profits go to Switzerland, along with Gerber's; TransAmerica's profits go to The Netherlands, while John Hancock Insurance's profits go to Canada. Even American Bankers Insurance Group is owned now by Fortis AG in Belgium.
Foreign companies are buying up our water systems, our power generating systems, our mines, and our few remaining factories. All because "flat world" so-called "free trade" p
"Speaking the Truth in times of universal deceit is a revolutionary act." -- George Orwell
I'm deeply suspicious of the idea of intellectual property as a source of economic growth.
If the U.S. were to dominate the world economy via intellectual property (but not in any other way), why would other countries continuing paying us for knowledge which once in the wild can be reproduced again and again at no cost?
Right now countries will respect our IP "ownership", but that's because they can't sell their products here if they don't. With the U.S. still the largest economy on the planet, you don't want to be shut out. However, once the rest of the world develops robust middle-class markets the cost of paying the US again and again for ideas is going to lose its appeal. Intellectual property (especially in the form of patents) is a "I got here first, so you can't do this without my permission" model. It's a fiction that only works as long as everyone playing agrees to believe in it (unlike, say, a rock, which is there whether you believe in it or not).
Life is short: void the warranty.
When it comes to outsourcing discussions, Slashdot is at its populist worst. No one wants to explain why it's ok to buy PC hardware from Taiwan, but not PC software from India (outsourcing is simply importing a service, and there's no meaningful difference between it and importing goods). And no one wants to explain why, despite all the wailing and gnashing of teeth about outsourcing, unemployment numbers look like they do here:
http://data.bls.gov/cgi-bin/surveymost?bls
(select the 4th item and have them draw a graph for you!)
Imposing Libertarian views on everyone online since 1992.
We must remember that the media itself consists of corporations. Just take the case of NBC. It's owned by General Electric. General Electric is also well-known for their manufacturing of military products.
We all know that war is often very profitable for both those who manufacture the supplies consumed during conflict, as well as for those who report on said conflict. Therefore it seems unlikely that those who are benefitting the most from a rather pro-war administration (if not an entire system) will stand against it.
Such an initiative would require the corporate mass media of the US to in turn speak out against itself. Again, it's doubtful that it would do it, at least to the extent where real change may happen.
Cyric Zndovzny at your service.
The scholarship thing is quite amusing. In order to fund more tax cuts, student loan interest subsidies have been drastically slashed. I know a bunch of people will probably jump on me saying that we shouldn't be subsidizing these things in the first place. Please don't bother unless you're willing to give up your mortgage deduction handouts and communist public highway system.
Why should our economy be locked into these few things like software development when diverting our resources into more needy areas would be a greater benefit?
The US economy is current diverting resources to needy areas such as government bureaucracy, the retail and service sectors, housing construction and the armed forces. Thank goodness we're not locked into software development and manufacturing!
Outsourcing is international trade. Two companies, one in America, one in India, exchange money for software.
If outsourcing is to a company's advantage then they will try to do it. That's a given. The only way to prevent outsourcing is to put up massive and draconian trade barriers.
Unfortunately, such trade barriers would impoverish the American people and cripple the American economy. An enormous amount of America's (and indeed the world's) wealth is due to international trade. It's one of the few points that most economists agree on.
So do you want to lose your job from outsourcing or from a crippled economy?
"Americans" working for an average salary in the 5 digit range should welcome the competition, because it's "the reality of a global economy," but Halliburton, working for an average contract in the 10 digit range, doesn't need the competition and should instead receive no-bid contracts. I wonder why that is? Is Halliburton participating in the economy of some other globe we don't know about?
Slashdot? Oh, I just read it for the articles.
Top and middle management travel so frequently that it would make almost no practical difference in results if we outsourced them. It would, however, make an enormous difference to the profitability of corporations and shareholder returns. Imagine how desirable it would be to save $150 million golden parachute and reinvest in R&D or employee retention? And so many foreign students have come and earned MBAs in U.S. business schools that there is absolutely no argument there that foreign CEOs couldn't do as good a job as American CEOs. Aha! the American CEO might say, 'but business is about communication and bold action, and that's something that people from protectionist economies and repressive societies just can't match.' Uh-huh. The average foreign student scores higher on any test of English than any American does. And bold action? Apparently they've never seen Chinese grandmas trying to get on a Beijing bus.
In short, what's good for the goose is good for the gander. The single best way to cut U.S. corporate labor costs is to outsource the top of the pyramid.
Do what you can, with what you have, where you are.