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,'"

Comments

Bush Whacked.

[JehCt]

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

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.

Re:Bush Whacked.

[CyricZ]

Please keep in mind that the Democrats are, much like the Republicans, funded by the very corporations and wealthy individuals who gain the most from outsourcing. Voting for them is basically a vote for the status quo.

Re:Bush Whacked.

[Marxist Hacker 42]

And worse yet- there's nothing India wants anymore. Their basic trade theory- trade only what they have in surplus and keep everything else for themselves- serves them very well. I just talked to our dear intern about this- she said the last time she went home to Hydrabad, she thought she had picked out novel and unique gifts- but her relatives already had them all.

Besides- what the hell could we make here to sell to India that China can't make for 1/100th the labor cost?

Re:Bush Whacked.

[guacamole]

Based on this, you're not telling us the whole story. Yes, a relatively small number of people will lose their jobs. At the same time, the vast majority of Americans are benefiting from a higher standard of living due to lover priced consumer goods. Also millions of Chinese and other East Asian poor are benefiting from the jobs created in their export oriented economist. It's a tough world. Can you give me a reason why a textile worker in USA should have a job when there is someone else willing to do this work for 10 times less?

Re:Bush Whacked.

[einhverfr]

As a technology consultant, I welcome competition in my consumer services division from India. Poor quality customer service from Dell, Microsoft, and the like are the bread and butter of how this part of my business makes money :-)

Re:Bush Whacked.

[Mr. Underbridge]

Consumers, which we all are, benefit as well because cheaper labor means a cheaper product. Sucks for the laborer who loses his job, but hey, that's free market capitalism.

Not only that, but people have been making these silly arguments for labor protectionism for years. Specifically, for around 300 years, since the time of Ludd at least. The fact is that the US has one of the highest average incomes on the planet, and we do this by sloughing off the job that don't lead to growth. These jobs are invariably replaced by better jobs. The fact is, that jobs and job markets change. If they didn't, we'd all be subsistence farmers or working in crappy factories, and no one wants that.

I think we can separate a feeling of empathy for the employee from a sense of doing what's best for the country. No form of protectionism has ever been good, labor or otherwise.

Re:Bush Whacked.

[Cyphertube]

Which is one of the reasons we need serious campaign finance reform.

Corporate donations should be out, as should corporate lobbying.

Lobbying should be funded solely with private donations that are capped. If you want to do more yourself, then lobby yourself, but organisations should be limited.

And I'd like to make campaigning limited to local funds. I don't want funds from New England rich boys or Texas oil tycoons funding political ads in my state. If you want to campaign for a federal office (House, Senate, or Presidency) in my state, then you should have to have the funding come from MY STATE. If you can't raise funds here for your advertising, well, too bad.

Imagine what THAT would do to corporations. It would strip their power to screw over the average citizen. Then, perhaps, politicians might actually have to listen to their home base, instead of big oil or big media.

Re:Bush Whacked.

[guitaristx]

Hear, hear!

Outsourcing is promoting even more separation between rich and poor. I thought that the American Dream was centered around doing your job well and getting promoted up through the ranks so you can retire a wealthy man. Apparently, that only applies to the Americans whose paychecks get bigger as business costs get smaller, leaving all of us hourly-wage earners (or salary earners) screwed. I can't get promoted no matter how well I do because there's a Mohandas-Ghandi-sound-alike who produces crap code that meets the immediate need with no regard for the future, who also accepts a third (or less) of what i earn. I write better code than the Indians and Chinese contractors that I work with. Everyone (including my managers) knows this, yet I'm still getting passed up for monetary incentives that I've rightfully earned, because there's always someone that will work cheaper. The American Dream apparently means for me that I work an 8-to-5 plus on-the-side contracting plus pinching pennies just to get by and support my family. Wait, the potential for wealth is there for me how?

So much for the American Dream.

Re:Bush Whacked.

[Anonymous Coward]

Nah, I don't care.

I'm glad that China has become the industrial center of the world.

I'm also glad that engineering and other idea work is going over there and America can concentrate on what it (nowadays) does best: scamming each other out of money in bubble markets.

I'm sure that in the not too distant future, if it ever came to war between our two nations, they'll be willing to sell us the technology we'll need to fight them at reasonable rates.

In fact, I, for one, welcome our new industrialized, technologically advanced Chinese overlords.

Re:Bush Whacked.

[Johnboi Waltune]

It's a tough world. Can you give me a reason why a textile worker in USA should have a job when there is someone else willing to do this work for 10 times less?

"Doing the work for 10 times less" is a fallacy if the cost of living in the other country is also 10 times less. The only people who come out ahead in your scenario are the textile factory owners.

Re:Bush Whacked.

[Vicissidude]

Please keep in mind that the Democrats are, much like the Republicans, funded by the very corporations and wealthy individuals who gain the most from outsourcing. Voting for them is basically a vote for the status quo.

That's a rather deceptive statement. Certainly, Democrats get a good chunk of the corporate funding. However, the vast majority of that funding goes to Republicans.

Re:Bush Whacked.

[Marxist Hacker 42]

We can make products they need over there such as infrastructure building technologies. They haven't the capacity to do it yet.

Bullshit. They're making OUR infrastructure building technologies. They obviously have the capacity, capability, and will- they have *everything* we do already. There's no competitive advantage left for the United States- they can do everything so much cheaper than we can that there is nothing left that is unique to us.

Have more faith and less suspicion and fear of people.

Easy for you to say if you have had less than two weeks laid off in your entire life. Try saying the same after searching for a new job for two years- and watching your children starve while you're doing it.

Re:Bush Whacked.

[smooth wombat]

Corporate donations should be out, as should corporate lobbying.

Interesting you should say that. About ten years ago there was a proposal by a presidential candidate which was titled, 'Can't vote, can't contribute'. Essentially, if you were not able to vote in an election you were not able to contribute.

This would exclude all PACs, corporations, etc from contributing to campaigns since none of them vote. Their members vote but not the entities themselves.

And I'd like to make campaigning limited to local funds.

This was another aspect of the above proposal. There is no reason someone from California should be contributing to a Senate race in another state. If they wanted to contribute money to the candidate they would have to move to the state in question.

In fact, as a classic example of how out-of-state funds can alter a campaign, Cynthia McKinney from Georgia was defeated as the direct result of thousands of dollars that was poured into her opponents campaign because she did not support Israeli policies in the Occupied Territories. Jewish donors from the Northeast responded and altered the outcome of the race.

Of course these changes to campaign finance laws will never happen because that would diminish the influence that business and PACs have. We couldn't have that happen, now could we?

Re:Bush Whacked.

[Swanktastic]

All donations should be required to be anonymous. The only reason to attach your name to a donation is with the 'quid pro quo' expectation that you're getting favors in return for your money. Of course, no politician would ever propose this, because it would absolutely kill donations, which would only be more proof of who works for whom. That, and the media corporations would have an absolute fit. After all, THEY are the primary beneficiary of these insane build-ups in campaign finance war chests.

Re:Bush Whacked.

[ToxikFetus]

The inherent problem with campaign finance restrictions is that they can give the incumbent an enormous advantage. Take, for example, the Vermont rules. In certain cases, the candidates can only allocate a few thousand dollars. How is a challenger supposed to mount an effective public relations campaign with that kind of money? Unless the incumbent royally F's up, most people will stick with what they know.

Re:Bush Whacked.

[DysenteryInTheRanks]

the Democrats are, much like the Republicans ... a vote for the status quo

This is the sort of UTTER BULLSHIT that got GW Bush elected over Al Gore because people were voting for Nader.

If Al Gore were elected, would we be *torturing* people at Abu Gharaib and Guantanamo? Would we be sending citizens of Canada and other allies to countries like Syria and Egypt for torture sessions as part of an "extraordinary rendition" program?

Would the nation's environmental laws be gutted by federal department heads hired from the nation's worst polluters? Would the administration be bullying scientists from FDA, NASA and the Dept of Agriculture (to name but a few) to cover up the deadly side effects of drugs put out by big pharma or to hush up evidence of global warming?

Would the government have exempted million-dollar-plus estates from the estate tax, draining money from social programs? Would it have cut taxes for the wealthiest Americans?

Would THOUSANDS of soldiers have died for want of a $260 armor plate? Would the government be aggressively billing people for busted body army and time in military hospitals?

You might not know JACK SHIT about politics, but don't let that doesn't stop you from trying to corrode the electoral process with total IGNORANCE of the actual behavioral history of Democrat and Republican politicians!

Re:Bush Whacked.

[Kadin2048]

That'd be impossible to implement. What's to stop me from sending a candidate some very odd amount of money -- say, $6328.41 -- (or better yet, do it repeatedly) and then just mention to them, through some sort of side channel, that all of those "41-cent" contributions were from me, and that if he didn't want to see the tap get shut off, he'd better do what I say. He wouldn't necessarily have to believe me, but I could say in advance that I was going to send a check a week late this month, or something else to prove that I'm behind them. It wouldn't be particularly hard.

There's no way you can have anonymity when the people giving the money don't want it.

It would be more practical just to bar donations outright, because at least then the problem is "just" monitoring a politician's finances to see if he's receiving money from an outside source (it's not easy, but it's something that law enforcement is fairly good at), rather than trying to stop the flow of information -- who's sending large amounts of money to whom, which is a relative impossibility.

Re:Bush Whacked.

[fireboy1919]

Corporate donations should be out, as should corporate lobbying.

Corporations will just pay private citizens to make their donations and do their lobbying. This changes nothing. Requiring people to not be affiliated with a corporation in order to influence their representatives means that the corporate employed have fewer rights than the non-corporate employed, which is arguably a violation of equal rights.

"Local funds only" is equally bad. I could easily funnel my money to a local business and have them give it. Its not like the representative wouldn't know where the money really comes from.

Which gets to the only solution that would actually work: the only way to keep corporations from influencing politicians is to remove their incentive to do so.
I see two ways to do this: either you have to pay everybody when you want to contribute, or you have to do so anonymously (so that the politicians don't know who's doing it). Of course, both policies would virtually eliminate honest campaign contributions, which means that either it'll never happen, or people will just give money illegally.

Nobody with that as their election stance would ever go far enough to get on the local news, much less the seat of real power.

Re:Bush Whacked.

[Johnny5000]

All donations should be required to be anonymous

I disagree. We should just carry the current system to it's logical conclusion without wasting any more time:

All donations should come with a patch that is sewn onto the politician's clothing, so they look like NASCAR drivers, and we know who gave them money.

And legislation should be clearly labeled with corporate sponsers, like advertising.

Re:Bush Whacked.

[Descalzo]

But what about the poor? Those in India need the jobs more than we do. What are the odds of any of us starving to death in the USA? Besides, aren't we all brothers anyway?

Or perhaps we should only worry about the American poor.

Anyway, if there is job to be done, and someone in India can do it just as well, but cheaper, and he needs the money more, then how can we deny the job to the Indian? What exactly is the problem here?

Re:Bush Whacked.

[Radres]

What about the fact that the government owns the educational system, influences the media, and is doing their level best to keep the population uninformed and ignorant?

Re:Bush Whacked.

[John Courtland]

Why? He/she does not represent you, you are not their constituent, you should have no say. If you would like a bill considered in a specific way, you use the channels available to you, your representative and senators.

Re:Bush Whacked.

[HangingChad]

the Democrats are, much like the Republicans ... a vote for the status quo

This is the sort of UTTER BULLSHIT that got GW Bush elected over Al Gore because people were voting for Nader.

Absolutely correct. I'm so sick of hearing that lame ass excuse. In case anyone forgot, the Republicans took control of both houses of Congress in 1994. Anything passed since then, no matter which president signed it, was Republican born and bred. That includes one of our all time /. favorites, the DMCA.

Stop using that crapass excuse for supporting a lying, corrupt and incompetent party. It does make a difference who you vote for.

Re:Bush Whacked.

[frank_adrian314159]

Voting for them is basically a vote for the status quo.

I'll vote for the match vs. the flame thrower any day. At least with the match I have a chance of controlling the fire.

Do the Democrats who voted for Nader and the Greens really think we're no worse off under the current regime? If they do, I know they're too stupid to run a country.

Stupid Libertarians might think there's no difference, but every body count increase I see from Iraq tells me there's a hell of a difference.

The fact is that Al Gore might have got hit on 9/11 (keyword is might - it's pretty clear that had he been elected, his Attorney General might have been more interested in policing potential terrorists than in covering up nekkid statues), but he would have limited the retaliation to the Taliban in Afghanistan and put qualified people in there to nation build. Right now, because of this administration's stupid adventurism, we not only are in the midst of an escalating civil war in Iraq but, because our troops are occupied there, we are seeing our gains in Afghanistan slipping away.

So to all of you Greens and Libs that "see no difference", just remember that when the next body bag comes home.

P.S. To all of the apologists who say "but the Dems voted to go to Iraq, too," I really don't want to get into a long, long, long pissing match. Let's just say that history will show that the Iraq adventure was prety much all Bush's and the Neocon's thing.

Re:Bush Whacked.

[dubl-u]

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.

Tempting to believe, but wrong.

It sounds like you understand one important part that others fail to get, the principle of Comparative Advantage, which is why trade creates wealth.

But there's more to it. Look, for example, at the computer you typed this on. Although computers were all initially made here, they're now almost all made overseas. By your theory, this would mean that the companies that started that are swimming in dough. But they're not; most of them are gone, the people in that business are struggling, and computer prices are forever reaching new lows. Why? Because it's mainly the consumers that capture the benefits.

A few American factory workers lost. But we all gained much cheaper hardware, a much larger gain.

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.

Yes, and that is indeed a problem.

Adjustments because of trade happen all the time, not just international trade. Amazon and their ecommerce ilk have undoubtedly put out of business many small stores, and countless people who used to take telephone and mail-in catalog orders. I'm sure that Yahoo and Google have decimated the ranks of people who used to answer Directory Assistance calls. The American worker probably has much more cause to hate California than India.

The solution isn't to stop trade and innovation. The solution is to tax the well off to pay for unemployment benefits and retraining. You can't outlaw winning and losing, but you can make sure the winners pay enough so that the losers can be winners again.

Re:Bush Whacked.

[B. Pascal]

Hello all:

The U.S. constitution was written to separate the church (quite a powerful force at the time) and the state. This was done wisely to protect each from the other.

Unfortunately, it seems that now, a new power is upon us: the corporations. With enough resources to influence government policies, it is no wonder that the U.S. government has been promoting policies to enhance profit instead of administering social welfare.

For some odd results, this situation rings a bell from the "Communist's Manifesto", a required reading in my undergrad history class. As much as we hate the actual implementation of communism, I must say the pro-business climate is actually matches the early environmental requirements in Marx's work.

I hope Marx is wrong.

Cheers.

B. Pascal

Re:Bush Whacked.

[Anonymous Coward]

nothing like a $0.25/day child labor to get the economy going!

Hell, those people never even HEARD of health insurance, workspace safety hazard regulations, and retirement payments. A republican dream playground, no less!

Would you sell your soul to satan to get that economy going?

Bottom line: there is a right, and there is a wrong. On this one issue, the Republicans happen to get it wrong.

Re:Bush Whacked.

[stinerman]

I don't think anyone here of a liberal stripe would argue that things wouldn't be better under Gore/Kerry/etc. What CyricZ and like minded /.ers are saying is that on many key issues there is no substantive difference between the Democrats and Republicans.

Examples:

USA PATRIOT Act renewal
Bankruptcy "reform"
Highway Pork Bill

I can come up with more examples if you like.

Notice we are not saying the Republicans and Democrats are the same. We are saying that they are close enough to warrant voting for someone other than them.

Re:Bush Whacked.

[stinerman]

At the same time, the vast majority of Americans are benefiting from a higher standard of living due to lover priced consumer goods.

Really? Are you sure about that? I'm not trying to troll, but you can't be sure about that. If you consulted an economic text, the theory says that you are correct, but we miss the bigger question:

Is the theory correct?

Re:Bush Whacked.

[Eivind]

I hate to break it to you, but the "general population" are peasants with high-school education, if that.

Furthermore they use as almost their sole source of information a few large media-conglomerates that are also controlled by (you guessed it) big business.

It's all well and good to say that the general population should stop acting that way. Do you also have a plan for how to acomplish that ? Because for the last few decades the trend has been in the oposite direction: the people act ever more like that.

Re:Bush Whacked.

[cartman]

And worse yet- there's nothing India wants anymore... what the hell could we make here to sell to India that China can't make for 1/100th the labor cost?

Right now, China and India cannot make CPUs (Intel and AMD), large airplanes (Boeing), pharmaceuticals (Pfizer, Merck, etc), fabrication equipment, large multiway servers (Sun, IBM, HP, Fujitsu), windows-compatible OSes, capital goods of various kinds, or even adequate food to feed their populations, which is why the U.S. is the world's largest agricultural exporter. Note that all the items on that list (except the last one) are much more profitable and pay much higher wages than what China and India export to us.

what the hell could we make here to sell to India that China can't make for 1/100th the labor cost?

If China and India didn't want to buy anything from us at our inflated prices then they would stop exporting to us. They're not just giving us products for free--exports exist to pay for imports. Even when Indians and Chinese buy U.S. assets or debt, it just means they're delaying (and slightly increasing) our exports to them.

Re:Bush Whacked.

[cartman]

You've obviously never looked at the label on the CPUs (I've got both Intel and AMD chips that have "Made in Taiwan" or "Made in China" stamped on them). You also apparently don't know that Boeing has a plant in Bejing that makes wings, tail sections, cockpits, and seats. You don't seem to understand that most of our fabrication equipment now comes from China, that IBM is now owned by Lenovo (a Chinese company), that HP has moved its manufacturing overseas, or that Microsoft now does most of it's coding in Hydrabad. You also apparently missed the news story last week that the United States now exports so much food that we only have a two week supply for our own people. NONE of this is profitable anymore.

I realize this conversation has already gotten silly, but I feel compelled to respond...

Nothing you said was correct. AMD has two fabs--one in Texas and one in Germany. Intel has >20 fabs all around the world but a large number of its fabs are in the US, the vast majority of its employees are in the US, and most of its high-paying jobs are in the US. The vast majority of Boeing manufacturing takes place in the Northwestern United States. HP has moved only a portion of its manufacturing abroad, and almost all of its employees are in the U.S. Microsoft has <10 percent of its programmers abroad. Lenovo bought IBM? BWAHAHAHA apparently you know nothing about those two companies--IBM is vastly larger than Lenovo and is probably larger than any company in China. Lenovo bought the laptop & desktop divisions (not even x86 servers) which was ~2% of IBM's business, and IBM sold it because it was the least profitable part.

You also apparently missed the news story last week that the United States now exports so much food that we only have a two week supply for our own people. NONE of this is profitable anymore.

The US has never stockpiled food for its own people. It has nothing to do with exports--food is perishable and stockpiling it is expensive.

YES all this trade profitable--do you think companies outsource because they anticipate taking a loss from it?

Not as long as OPEC still sells it's oil in dollars or as long as the New York Stock Exchange is still willing to sell American businesses to foreigners- there's plenty they want to buy.

You mean foreigners are willing to export things to us, while importing nothing from us, in order to make use of our paper currency to trade between themselves? If so we should print dollars for export. Apparently, foreigners are willing to give us products for free ("flood our markets") with cars and computers in exchange for little slips of paper that they apparently never intend to redeem...

And what exports would those be? All of your examples except for food are made in China and India.

The United States exports ~$1 trillion in products anually, including (but not limited to) the products I listed. For comparison, all of the countries in the European Union combined (population 460 million) have exports of about ~$1.4 trillion.

Re:Bush Whacked.

[TomRitchford]

I didn't write the parent post. But let me rephrase it as "Bush has never demonstrated the slightest sympathy towards the poor or victims of disaster. It could well be because he's been completely shielded from financial need and from the consequences of his blunders by his rich, influential family."

Does this make it clearer to you?

Outsource him

[chrismcdirty]

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.

Re:Outsource him

[jcgf]

Yeah, but make sure that he has to train his own replacement. No, wait on second thought maybe that wouldn't be a good idea.

Re:Outsource him

[darkmeridian]

Most Indians understand English, and as such are overqualified for Mr. Bush's position.

Good.

[Eightyford]

If you want a free market you have to accept the consequences.

Re:Good.

[AlexMax2742]

In a perfect world.

Unfortuniatly, we're competing with Asia, which doesn't value things such as human rights. As long as we're at an inherant disadvantage because our standard of living is higher, we don't have a chance. Assuming all thing are equal, though, you're right.

Of course, there might be something I'm missing. Feel free to point it out.

Re:Good.

[Anonymous Coward]

Let us know when you spot a free market. As far as I can tell, there's never been one--they exist only in economics texts and right-wing fantasies.

Re: your post--just try importing food, goods, or labor to India. Guess what--the India/US import controls are not reflexively symmetric.

Re:Good.

[eln]

A completely free market inevitably leads to the concentration of wealth in a few hands, because as people become successful they erect barriers to prevent other people from following in their footsteps. We saw this happen before with the plutocratic oligarchy of the early 20th century. Various antitrust legislation and government reform helped to bring things a little more into balance, but now those things have been largely abandoned, and we're headed back to a state where a very few people control the vast majority of the wealth.

100% free capitalism cannot sustain itself over the long term, we've seen that before. This is why the government has a role to play in the economy. There is a vast middle ground between pure capitalism and pure socialism, and neither extreme can produce a sustainable economy.

Re:Good.

[tpgp]

Unfortuniatly, we're competing with Asia, which doesn't value things such as human rights. As long as we're at an inherant disadvantage because our standard of living is higher, we don't have a chance. Assuming all thing are equal, though, you're right.

Of course, there might be something I'm missing. Feel free to point it out.

1) Asia is not a country. It has different human rights values depending on where you are.

2) You equate standard of living and human rights - quite incorrectly. (Singapore for instance has a higher standard of living then the US, with less attention to human rights)

Re:Good.

[qwijibo]

Human rights are a commodity. Do you take them into account when you purchase everything you buy? You pay a premium to not purchase Chinese products. Anyone who purchases solely on cost doesn't consider human rights to be a valuable free market commodity that they wish to purchase.

We are at an inherent disadvantage because we have a decadent lifestyle. Every time a person who is living in poverty in the US eats at McDonalds or buys a beer, they're taking advantage of something that is not available to the poor in many other countries. Next time you have ramen for dinner and think "woe is me", know that there are people who would kill you in a heartbeat for your $0.10 dinner.

If my services are a commodity that can be outsourced to a place where the wages are much lower, I'm not providing value to my employer. I'm ok with this arrangement, because it will exist whether I want to believe in it or not. No one is entitled to any particular job. We are a means to an end. If we are not doing something that helps someone generate profit, there will be no money for us to be paid with. It's just a harsh fact of life.

Re:Good.

[Karl Cocknozzle]

who scream the West stands for depravity, loose women and degenerate morals.

...well, I don't know about you, but I enjoy those things... :)

Re:Good.

[spmallick]

" Unfortuniatly, we're competing with Asia, which doesn't value things such as human rights."

Yes I hear you Sir. Asians are responsible for Guantanamo, they maintain secret prisons in Europe, have left Iraq in chaos with 30,000 civilians dead and were responsible for the only weapons of mass destruction ever used in human history.

You would be surprised to know that Asia is a continent. With that knowledge you probably would have not passed that sweeping remark. I dont hold it againts you because someone said "Never Assume Malice When Stupidity Will Suffice".

Grow beyond Fox News :)

Re:Good.

[JavaLord]

The majority seem to want to. In other words, if you want a democracy, you have to accept the consequences.

1. A democracy does not mean you need total free trade. Democratic nations can vote for socialist leaders, or leaders who realize that unlimited free trade is a bad idea if only you are playing by the rules.

2. Our founding fathers were for free trade between the states, but wanted tariffs to protect American workers. They also thought citizens should be armed, believed in small government, and didn't think we should go overseas looking for monsters to slay or be involved in entangling alliances. Then again, what did they know? ;)

3. As I hinted above, free trade isn't really free trade. India has Tariffs. China does as well. The only tariffs we have are to protect us against Canada (DUMB).

The free trade is going only one way, and it's not helping the middle class. This isn't all Bush, Clinton was the same way.

Re:Good.

[spun]

By that logic, why shouldn't the rich want to keep their higher standard of living by outsourcing our jobs? Outsourcing sucks, but so does the poverty that is prevalent in most of the world. Hopefully things will even out and everyone will be better off.

However, if capital and goods are free to move across national borders and people aren't, the rich can simply play one nation off against another, moving to poorer areas when a region gets wealthier. When a nation becomes poor again, they will move back.

Re:Good.

[amliebsch]

Umm...have you checked since the election ended?

http://www.cnn.com/ELECTION/2004/pages/res ults/president/

Re:Good.

[drinkypoo]

The majority of the wealth will always be concentrated in the hands of a small group of people. Even in a utopian society(unless pure communism is your idea of a utopia), there will be people who are willing to work very hard to be better off than most.

While that is true, the inequity would be sharply curbed if you couldn't make money from the labors of others. It would be within an order of magnitude, not six of them or so.

Re:Good.

[qwijibo]

If you couldn't make money from the labors of others, there would be no employees. The only reason to have employees is that they provide more benefit than the expenses incurred. Outsourcing occurs because it's possible to get the same benefit and lower the expenses.

Re:Good.

[Johnny5000]

If I don't want a free market, I still get to accept the consequences.

The majority seem to want to. In other words, if you want a democracy, you have to accept the consequences.


I think the majority want jobs that pay the traditionally high American wages, and cheap consumer goods.

Maybe the two are mutually exclusive, and maybe not. If they are, it will be a tough lesson to learn the hard way.

Re:Good.

[Kismet]

A completely free market inevitably leads to the concentration of wealth in a few hands, because as people become successful they erect barriers to prevent other people from following in their footsteps. We saw this happen before with the plutocratic oligarchy of the early 20th century.

Right. Rich men decided that a truly free market wouldn't always guarantee them a fortune. So they began to tinker with it by shutting out the smaller entrepreneurs who might have produced competition. They craved a leveled and massified population whom they could count on to keep the capital moving in their direction (because the people work for them!). They've intervened on the free market and made it something else instead. You said an oligarchy. I think you're right. I like that term for it, because it reveals the true nature of business today: Businesses are sovereign nations unto themselves. And they have no borders. We aren't mere Americans (etc.), we are citizens of the companies we work for, and we abide by their policies. If possible, our companies care less for our well-being than our government does; the profit must come first (whereas the government was intended for the people).

But your argument now becomes very interesting:

100% free capitalism cannot sustain itself over the long term, we've seen that before. This is why the government has a role to play in the economy. There is a vast middle ground between pure capitalism and pure socialism, and neither extreme can produce a sustainable economy.

Here I say you are wrong. The problem with our "free market" is that it isn't a free market. It's dominated by monopoly and oligarchy, as you said. To fix the problem, we need to free the market again. Government tinkering doesn't make it any more free. Read the proceedings of the 73rd congress, 1934. You'll get a better idea of why government wants to regulate the economy. As it turns out, it's for the exact same reason that wealthy businessmen have for their own meddling. We want businessmen AND politicians out of the economy. There is no role for either of them. We need a FREE market.

A free market is a largely local market sustained by small business. International trade is performed by local entrepreneurs. The same principles of small government ought to apply equally to the business-state. We have to step back and ask ourselves, why are we working for somebody else? That's the root of the problem, and it won't be fixed easily.

If we had a government that could be relied on for its integrity and honesty, I would agree with you that the government should play a role in the economy. If we could have such a government, we might have a chance at a truly free market.

Mr. Bush has reinforced his belief that government serves not the people, but the economy (he will contend that "government serves the people best through the economy. I say: the people are the economy."). Mr. Bush refuses to protect "some Americans" for the sake of a robust bottom line. This was not the Founder's vision for our Republic, and such is a great crime against the people and a violation of our nation's charter.

Re:Good.

[Creedo]

Personally, I think all businesses should be co-ops. It would be a nice solution to the wealth distribution problem if executed properly.
While I do contract Perl work for my main income, I also operate a small town computer repair service. I've grown this side business over the past 3 years into a decent little business. I've taken the time and effort to build a solid reputation, and as a result I have a sizable chunk of the computer repair service in the town and the surrounding area. In fact, my main competitor keeps trying to offer me his business. I don't bother buying it, because I am gradually absorbing his business anyway(he has horrible people and repair skills; he essentially got by for years because he was the only game in town).
I've had several kids asking me for a job. If I were to hire one, I would have to train them, schedule appointments for them, and introduce them to my customers. They could easily go and start their own business. Instead, they want to benefit from my hard work and investment. Which is fine. But I won't give them partial ownership over the business I grew. If we can come to an agreement as to what would be a fair wage for their services, then we can work together. If not, given that we have a free market, they are free to compete with me, or to find other employment.

Mmmm Curry

[Dimentox]

"and that if we can make a product they want". Ok, you hear him well its time we all quit our jobs and become curry spice makers! We will be Ba-Zillion-Airs!.

Re:Mmmm Curry

[AKAImBatman]

Except fast food won't be exported, they'll just set up a McDonald's in India

Which will have to pay franchising fees to McDonald's America, and also purchase raw product from McDonald's Indian Distribution centers which are owned by McDonald's America.

all those fancy plasma TVs aren't made in America

But are paid for and sold by American companies.

so the American working man won't benefit, but the big American companies will..

That depends on how you define the American "working man". "Working man" used to mean factory workers and service personnel. As time goes on, it has been changing to mean corporate workers (many of who can get $$$ bonuses for opening business in new areas) and entrepenuers. As long as the change isn't too sudden (thus leaving a massive number of specialized workers jobless), such change is far from a bad thing. In fact, it generally means more wealth and independence for all.

Umm, I'm not so sure about this

[Calibax]

'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,'

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.

Re:Umm, I'm not so sure about this

[daytrip00]

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.


How about x86 cpus, cell phones, optical equipment (for baliwood), chemical products and consulting. Indians buy all of those things and don't manufacture them domestically.

Re:Umm, I'm not so sure about this

[HiThere]

Lower prices only benefit you if your salary stays constant...and you continue to have one.

Re:Umm, I'm not so sure about this

[Professor_UNIX]

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.

Buy stocks in the companies that are profiting overseas then. An initial investment of $5 or $6 million should be able to keep you going in the market for the rest of your life! Just borrow the money from your parents or a friend and then pay them back with your profits.

Re:Umm, I'm not so sure about this

[mellon]

So the reason why this is true is that there is an economic imbalance; labor in the United States is valued higher than labor in, say, India. Outsourcing levels the playing field a little, but outsourcing is expensive - the only reason it's worth doing is that imbalance - the overhead cost of outsourcing plus the cost of labor in the outsource location is less than the raw cost of labor in the location from which the outsourcing is occurring. One of the results of heavy outsourcing is that the imbalance levels out.

If you're okay with children starving in China, then it's fine to oppose this leveling. But if you actually want the world to be a better place, outsourcing is a good thing. Leveling the labor playing field is a good thing. Why is it that it's better for someone in the U.S. to prosper than someone in India? Think about it.

Historically what we've seen is that changes like this float all boats. Although I am not fond of him in general, Bush is right in saying that increased prosperity elsewhere creates opportunity here. The suck is that the imbalance will take a while to level out, and while that's happening we will experience some economic woes. But if the value of labor were the same in every country in the world, the result would be global prosperity, not global poverty.

I'll get back to you about whether this is okay with me when my job gets outsourced, but at least in the abstract it seems like a good thing.

Re:Umm, I'm not so sure about this

[cyberwench]

If you're okay with children starving in China, then it's fine to oppose this leveling. But if you actually want the world to be a better place, outsourcing is a good thing. Leveling the labor playing field is a good thing. Why is it that it's better for someone in the U.S. to prosper than someone in India? Think about it.

Well, the thing for me is that we are not responsible for making sure the people in China and India are prospering. I'm not fond of protectionism, but realistically we do need to look after our own people. It's not like people in India are saying "Well, sure, this job is good... but what about the kids in the US?" There has to be some effort to make sure that while we are improving things in the rest of the world, that we're not burning ourselves too badly in the process.

Re:Umm, I'm not so sure about this

[demachina]

"If you're okay with children starving in China, then it's fine to oppose this leveling."

I'm not exactly sure why, because India and China failed to control unsustainable population growth, that the rest of the world needs to destroy their economies and economic well being to insure they are well fed. Economics is in reality a form of warfare. Sometimes a rising tide raises all boats but most of the time there are economic winners and losers. The U.S. was the big winner in the 20th century. It is poised to be a big loser in this one, at least for the vast majority of its people, while its top 1% will probably continue to do very well. In this brand of warfare there really is no reason why U.S. workers should aid and abet their own destruction to insure the "Chinese" are well fad.

This isn't really about insuring China and India are well fed anyway.

The bottomline at work here is there is a global economic elite, less than 1% of the world populations who are rich and getting richer. In the last 30 years many powerful communist party members in China abandoned socialism, for Fascism, and are entering the ranks of this elite along side the long established rich in the U.S. and Europe.

This elite embraces and loves globalization. They have the capital and the ability to invest it anywhere in the world where it will yield the greatest return on their investment. By contrast working people have limited resource and they can't just invest in the new economic hotspot in the world like China. If their nations economy craters they get to starve.

Its a basic axiom of capitalism that labor cost is one of the basic factors in profitability. In the past trade and physical barriers allowed labor costs to diverge in different regions. The U.S., Japan and Western Europe could have high wage rates and a good standard of living because they weren't competing head to head with people making a few cents an hour in Asia. A key barrier that allowed this was that it was expensive to ship goods between nations both because of tarriffs and the cost of hand loading and unloading ships using longshoremen. The WTO has dismantled the tarriffs, at least in to the West, though they still seem to thrive in places like China blocking Western good going there. Shipping costs plunged thanks to container shipping. Communications costs disappeared thanks to fiber optics and computer networks.

What we see today and what Bush is really saying is, that multinational corporations, and wealthy capitalists embrace globalization. It is great for them. In particular its causing a dramatic drop in labor costs to them and capitalism thrives on low cost labor.

The thing they continually gloss over is that this means that in nations where labor costs are high, those workers are mostly doomed unless they have or can acquire skills that justify a premium salary. They will either hit unemployment or their will be constant downward pressure on their incomes. People now in the middle class will be pushed in to poverty. In fact this is already happening in the U.S. The number of people living below the poverty line is increasing dramatically in recent years. The U.S. economy still appears prosperous because most of its big companies are globalized so they are still making lots of money, so the DOW and Nasdaq do just fine, as they slowly dispose of their expensive U.S. work forces and reap big gains from low cost foreign labor. Unfortunately their U.S. work forces are being quietly destroyed in the process.

Its really easy to see where this ends. The U.S. is going to end up where it was at the beginning of the 20th century. There will be a small number of very wealthy people, doing very well, and a huge body of desperately poor workers, barely making enough to survive, working in dismal working conditions if they can get work at all.

The ruling elite which really is George W.'s only constituency will still be very comfortable and very happy. They have money and they can keep making money

Re:Umm, I'm not so sure about this

[Vicissidude]

You've never heard of one family, one child?

You're ignoring their history up until that point.

Re:Umm, I'm not so sure about this

[demachina]

"So if you want less population growth, what's happening in Asia right now is good news, not bad news."

There isn't anything good about whats happening in Asia now unless you are profiting from it. Industrializing 2+ billion people, giving them cars, freeways and modern amenities is going to drain the planet of resources and destroy the environment barring major breakthroughs in things like steel and energy production. Sure maybe as they urbanize they will reproduce less but the gains from lower population growth are "out there" while the turmoil that will come from this massive industrialization of so many people is going to hammer the world in the near term which is all that matters to me.

The U.S. pushed this affluent industrialized life style excess to its limits in the last century with a much smaller population. If India and China do it, which they are, the results are going to be cataclysmic.

As for me being happy about China controlling their population, well its pretty much already too late for my lifetime.

"Don't get too attached to your preconceptions about the power elite and class war. As long as you frame it that way, you're perpetuating the problem, not solving it."

I have no clue what you are trying to say here. This is such a vague statement its not something that can be countered. I suspect you are doing what most people do when the subject of class warfare comes up. Deny it and make out like the person that raised it is a crackpot. It is the beauty of modern class warfare that the ruling elite has managed to con workers to such an extent that workers deny it exists or is happening or they suffer because of it. In effect working people have unilaterally disarmed and the rich are laughing all the way to the bank. They can sucker dumb workers in to voting for people like George W. and his faux Republican friends using wedge issues and fear mongering, and then George W. and friends screw them coming and going economically which at the end of they is the one issue that really matters.

If you want to see understand the Bush administrations attitude towards workers you need to look no further than Elaine Chow, the Labor secretary. Her family are relatively recent emigres from China, and they made their fortune on container shipping from China to the U.S. She is a poster child for making money by outsourcing American jobs to China. She is openly contemptuous of American workers and she is the LABOR SECRETARY.

Editors Shouldn't Bitch, Their Own Company Does It

[Anonymous Coward]

Here's one article on it.

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.

There is a point in this...

[halivar]

While I don't like outsourcing from a consumer perspective (spend four hours on the phone with a Dell "technician" that can't speak English), I think there is a point to be made in the fact that we don't try nearly as hard to sell our crap overseas as foreigners do selling their crap to us. Outsourcing wouldn't be such an issue if we weren't the only people buying our stuff.

Re:There is a point in this...

[iSwitched]

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.

Re:There is a point in this...

[Forbman]

I think we do, but there are lots of barriers to it. If we try to sell our stuff, we're percieved as trying to put local businesses out of business. Or, because of economies of scale, our stuff is cheaper than their stuff. Or the whole "cultural imperialism" aspect of it, too.

Try exporting US lamb to New Zealand... It's only slightly more pointless than trying to raise US lamb for US markets.

Australia, Canada get to keep their Wheat Boards, subsidizing their wheat exports while creating monopolies in their countries that can lockout US wheat exports to their countries. US had similar things, but they've all been bitch-slapped by the WTO.

Soybean production is moving from the US to Argentina and Brazil. OK, so they have about 3x the available land to raise soybeans than the US has...

Easy to swallow

[Quasar1999]

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.

Re:Easy to swallow

[jmichaelg]

Those affected by the outsourcing won't give a shit about a new market, and only care about their lost job/income/life.

Not true. Some of us take the hit and find something else.

I've seen it from both sides. I've lost a couple of jobs to outsourcing. I also grew up in Mexico in the 50's where protectionism was absurd. American goods which were better made than Mexican counterparts, cost 2-3 times as much only because of tariffs Mexico imposed on those goods. The only people who benefited from that were the sloppy local producers.

Expecting the world to stand still so you can continue a comfortable lifestyle isn't realistic. Sure, you can vote for a pandering politician who'll swear to protect your job. But that's like voting for someone who never did any work in his life so you don't have to work either - not a formula for a better economy.

Time to realize the world doesn't care.

[Shivetya]

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.

Re:Time to realize the world doesn't care.

[MobyDisk]

War is the great equalizer. What the world should fear is that some big country might go to war rather than lose control.

Re:Time to realize the world doesn't care.

[qwijibo]

Are you saying there are moral objections to outsourcing labor? The companies are trying to get something done at the best price. The people who aren't providing enough value to the company to justify their salary are not entitled to the company's money any more than the company is entitled to their customers' and investors' money.

I think it's unfortunate that a lot of jobs are leaving the US. I also think there will be some serious long term problems that come from people not having opportunities to work in some heavily outsourced fields. At some point, we will run out of experts if there is no way to develop that experience over time because learning is not cost effective.

Outsourcing to call centers that don't speak the language well enough causes a backlash. There are already some companies that have moved their call centers back to the US. There are also training programs to teach people to speak with more recognizable accents. Ie, in India, there are people who specialize in speaking with an American, British, or Australian accent to communicate more effectively with the customers in those countries. If you're not able to communicate with your vendors, you need to complain to them. The people with the big checkbooks can refuse to renew service contracts if the service being provided is worthless. That affects the bottom line more than the cost difference between phone support in the US vs India.

...but first, they need a job to pay for it....

[xxxJonBoyxxx]

"...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..."

...but first, they need a job to pay for it, and that's where my fellow Americans can help today. God bless.

not much of market

[acvh]

per capita GDP is $3100. per capita GDP in US is $41,800. not much of a trade.

Bush's globalization focus is disturbing to me. It is reducing the US economy to one of consumption, while production is leaving the country. Couple that with increasing federal spending, and debt, and increasing personal spending, and debt, and the US will be an economic hostage to those who buy US debt securities.

Gas stations on the Garden State Parkway are now run by Lukoil, a Russian oil company. More and more of America's cash is leaving the country - our affluence is being purchased at the expense of our future.

Remember, everyone can do everything!

[zzyzx]

Your job gets outsourced? Don't worry. Just upgrade your skills. Eventually everyone will be a CEO!

That's the usual refrain here when outsourcing debates start. In addition to the fact that we can't all be the best and ok but not amazing programmers have to do something for a living, if we don't have the entry level jobs here, who will learn the skills to let them design programs?

Indians have programmed for years.

[wayward_son]

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.

Re:Indians have programmed for years.

[maelstrom]

2010's - Indian programmers program for Indian corporations in India
2020's - Indian programmers program for major Indian corporations in India
2030's - US programmers program for major Indian corporations in the US

Re:Indians have programmed for years.

[LukePieStalker]

1990's - Indian programmers programmed for major US corporations in the US.

2000's - Indian programmers program for major US corporations in India.

2010's - Indian programmers program for major Indian corporations in India.

2020's - Major Indian corporations outsource work to U.S. programmers because wages are so much lower here.

the reality is...

[solipsist0x01]

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.

Re:the reality is...

[lgw]

Perhaps this is true, but it's a very pessimistic way of looking at it. We are helping less-deveoped countries to become as wealthy as we are. Doing so does cost us somehting. But the result is not that every country is poor. When "all American jobs went to Japan", the long term result was that Japan became about as rich as the US, Japan stopped being a cheap labor market, and Japanese cars are built in factories in the US now.

Why will India be any different? People wil whine and complain, and 50 years form now India will be just as wealthy as the US, and Indian companies will have call centers in the US. I don't seem to be any poorer for the decades of manufacturing "moving to Japan", I just have a far better car than I otherwise would, and that car is built in a factory in the US, despite being a "Japanese" car.

Re:the reality is...

[HardCase]

You're singing the same tired refrain that we've been hearing for the past 30 years.

Year Real GDP (billions of 2000 dollars)
1970 $3771.9
1971 $3898.6
1972 $4105.0
1973 $4341.5
1974 $4319.6
1975 $4311.2
1976 $4540.9
1977 $4750.5
1978 $5015.0
1979 $5173.4
1980 $5161.7
1981 $5291.7
1982 $5189.3
1983 $5423.8
1984 $5813.6
1985 $6053.7
1986 $6263.6
1987 $6475.1
1988 $6742.7
1989 $6981.4
1990 $7112.5
1991 $7100.5
1992 $7336.6
1993 $7532.7
1994 $7835.5
1995 $8031.7
1996 $8328.9
1997 $8703.5
1998 $9066.9
1999 $9470.3
2000 $9817.0
2001 $9890.7
2002 $10048.8
2003 $10320.6
2004 $10755.7


Detect a trend?

Re:the reality is...

[bstarrfield]

GDP is a pretty damn poor measure of economic peformance. GDP is a measure of aggregate economic activity, with no description of how that economic activity (income) is spread out amongst the population. Not to mention that it doesn't show how income is produced - is a service job at Wal-Mart as good for our economy as a job at GM producing cares? There are far more problems with using GDP as your golden measure.

What has effectively happened in our economy- and you probably know this considering you spat out a trend from 1970 to 2004 is that real income per person has remained fairly flat. In other words, the economy has grown but the normal worker has not seen the benefits. Go read Krugman over at the NY Times. Or better yet, read the source material Where did the productivity go? which describes what's happened to our economy.

You should damn well listen to the refrain and understand the numbers - something is going seriously wrong in America. The middle class is falling apart under increasing costs (college, health care, no pensions) while the absolute top has received nearly all of the benefits of outsourcing, increased productivity, and the last thirty years of economic growth.

Re:the reality is...

[rob_squared]

Nevermind the thousands of people who depended on those jobs in the 1980s for cars are all basically poor now, and that we seemed to have some rather poor economic situations in the us afterwards...

Re:the reality is...

[AFCArchvile]

1980's : Ooooh, the Japanese cars are coming, they will take over our whole country .... we are doomed!

All 10 of the top 10 best cars in Consumer Reports' 2006 Cars issue are Japanese-made.

1990's : NAFTA, oh my God, Mexicans will take over all our manufacturing jobs ... we are doomed!

Just today, US-based auto parts maker Dana filed for bankruptcy protection. This is a bombshell event, in addition to the ongoing malaise at GM and Ford. Billions of dollars in losses for the year ($1 billion of losses for GM in Q4'05 alone).

2000-01 : Outsourcing software, call centres ... Indians running amok, taking over all our service jobs .. we are doomed!

Just wait. There will be something to fill in this space soon.

Re:the reality is...

[dubl-u]

You should damn well listen to the refrain and understand the numbers - something is going seriously wrong in America. The middle class is falling apart under increasing costs (college, health care, no pensions) while the absolute top has received nearly all of the benefits of outsourcing, increased productivity, and the last thirty years of economic growth.

Which has exactly nothing to do with whether or not trade is a good idea. The numbers demonstrate that trade makes societies richer. Whether that makes individuals richer is up to the society.

And that's whatkills me about the various anti-trade movements. They are wasting all their political capital to make society poorer, rather ways to divert the increase in wealth to help the poor.

Re:the reality is...

[RexRhino]

The amount of goods and services that a person can afford per hour of labor has been steadily increasing. Your average middle class worker now can afford more food, more housing, more automobile, and certainly more consumer electronics than he ever could.

Confirm this for yourself. Find out what the average wage was 30 years ago or 40 years ago. Look in an old catalog, and look at what someone could purchase with their wages then, and compare it with average wages and what they can afford to purchase now. Aside from things like big screen TVs and computers that obviously we can afford more of now, we can now afford more clothes, more lawnmowers, more washing machines, more sofas, etc. We can afford to eat out more, purchase more pre-packaged/advertized food products. People can now afford better housing. People can pretty much afford much more of everything.

You do understand that cheaper goods = higher income, right? There is no difference if a shirt cost $10, and you make $10 an hour, or if a shirt cost $5, and you make $5 an hour, right?

Americans today are the wealthiest people in the world, living in the most wealthy period of history. This is undenyably the truth.

There is something to be said about the so called gap between the "rich" and "poor", but a better way to describe it would be the gap between the "Richest", and the "rich". It is true that the richest group of people have seen their real consumption increase much faster than the middle class or poor. And unlike a lot of people, I would fully agree with you that disparity between the rich and the richest is undesirable. It would be much better to see income increase evenly amoung all people.

But this disparity doesn't have much to do with foriegn trade. It has more to do with the minimum capital required to do buisness in the United States. 50 years ago, lets say you wanted to open a buisness, let say a small factory that machines parts. Such a buisness would be fairly easy for a middle class person to start. But not so today. The cost of OSHA compliance, compliance with local/state/country/federal enviornmental laws and hiring the experts, lawyers, to ensure compliance, insuring that you comply with all the non-enviornment local/state/country/federal laws, ensuring that you meet all the conditions that your workplace is handicapped accessible, making sure you are not only in full compliance with the 75,000 pages of tax laws, but that you can prove to the IRS you are in full compliance... making sure you are an "equal oportunity employer" (this wouldn't be so bad if it was simply banning discrimination, but it is thousands of pages of rules and regulations that can be quite counter-inuitive, and you are going to have to hire a lawyer to deal with them), and lets not forget the cost of liability insurance, because people in America love to deal with them.

Basicly, you are talking a cost of several million dollars to start a significant buisness in the U.S. ... Yeah, there are exceptions, you CAN probably start a little web design buisness, or open a video or music shop, or a resteraunt for less money... or possibly even a super highly specialized item... but you are NOT going to be manufacturing a consumer product in the U.S. for less than a couple million - and that leaves out the vast majority of Americans from opening a buisness. That means less competition for big buisness., etc.

Why would they buy American?

[rben]

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.

Re:Why would they buy American?

[Mr. Flibble]

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.

Has it occured to you that by the very act of being able to post to slashdot, you are in fact, (compared to the rest of the worlds population) one of the rich people?

Comparative advantage, not surplus.

[CyricZ]

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.

Re:Comparative advantage, not surplus.

[CyricZ]

No, not everything can be made cheaper somewhere else.

Suppose it takes China 10 h to produce a computer, and 2 h to produce a car . It takes America 2 h to produce a computer, and 1 h to produce a car. America has an absolute advantage over China, as they can produce more computers and cars in a fixed amount of time.

In the US, 1 computer costs 2 cars. In China, 1 computer costs 5 cars. In the US, 1 car costs 0.5 computers. In China, 1 car costs only 0.2 computers. As we can see, China gives up fewer computers for each car produced than the US does.

Thus, even though the US can produce both goods faster, and can hence produce more goods in a fixed period of time, it still costs them more to produce a car (in terms of computers). Thus China should focus on producing cars, while the US manufactures computers, because they each have a comparative advantage in that area.

Now, that's very basic trade economics. It doesn't necessarily apply well to the real world, but such examples do show us that one country can never produce everything for less than another nation. Even if both nations have the same productivity, the result is that neither has a comparative advantage nor an absolute advantage over the other.

Re:Comparative advantage, not surplus.

[Marxist Hacker 42]

No, not everything can be made cheaper somewhere else.

You're wrong about that.

Suppose it takes China 10 h to produce a computer, and 2 h to produce a car . It takes America 2 h to produce a computer, and 1 h to produce a car. America has an absolute advantage over China, as they can produce more computers and cars in a fixed amount of time.

But since China's minimum wage is 1/100th of ours- they pay only the eqivalent of .1 hour to produce a computer, and .02 hours to produce a car. It's still cheaper to do both in China- NO abosolute advantage for America at all.

In the US, 1 computer costs 2 cars. In China, 1 computer costs 5 cars. In the US, 1 car costs 0.5 computers. In China, 1 car costs only 0.2 computers. As we can see, China gives up fewer computers for each car produced than the US does.

But- here's the big one- China has a billion workers to feed. They have a virtually unlimited supply of labor. So they can make all the computers and cars THEY need, PLUS enough for export to swamp the markets of the United States and Europe with computers and cars, and drive the native manufacturers in the US and Europe out of business entirely, of both computers and cars.

Thus, even though the US can produce both goods faster, and can hence produce more goods in a fixed period of time, it still costs them more to produce a car (in terms of computers). Thus China should focus on producing cars, while the US manufactures computers, because they each have a comparative advantage in that area.

But since China has a relatively unlimited supply of workers, they can just bring more factories online and outproduce the United States in both cars and computers- thus utterly destroying the US market with cheaper goods.

Now, that's very basic trade economics.

It's also complete bullshit at this point, since China's wages are 1/100th of ours and they have no shortage of labor.

It doesn't necessarily apply well to the real world, but such examples do show us that one country can never produce everything for less than another nation.

It actually shows no such thing, because it has a severe lack of input data.

Even if both nations have the same productivity, the result is that neither has a comparative advantage nor an absolute advantage over the other.

Productivity means NOTHING when you have a billion starving workers to feed- you can always overcome productivity with sheer numbers. Ricardo was an idiot and if he were alive today I'd shoot him just for proposing such a dangerous piece of sheer propaganda and lies.

Re:Comparative advantage, not surplus.

[Marxist Hacker 42]

This is a very good point. Even if each item is cheaper to make in India, when considered seperately, that doesn't mean that India can produce all items cheaper, if it tries to do everything.

Does it matter? They've got 29% unemployment, and 1/10th our minimum wage. That's a hell of a lot of worker dollars to soak up before productivity means anything at all- and when you throw in the fact that they could be trading with China, which adds another billion workers and 1/100th our minimum wage, our productivity doesn't mean squat unless it's 100x better than the entire rest of the world in at least one item.

In any case, India is a cheap labor market, but it has poor infrastructure, so it doesn't scale very well. It's going to take 50 years to build good roads, good power, and good communications infrastructure out to the far corners of India, just as it did here, and by that time India will no longer be a cheap labor market.

The point isn't that. The point is- they can do all of that with native labor importing nothing, so it means nothing as far as trade is concerned.

Also, while we're still losing manufacturing jobs to China, for example, China is losing manufacturing jobs far faster to robots. Eventually, all manufacturing will be highly automated and there won't really be any manufacturing jobs anywhere. That's just the continuation of the industrial revolution to its inevitable conclusion, and that will benefit everyone to judge from history.

Either that, or it will be feudalism all over again- the robots will benefit the top 1% of society and everybody else will simply starve to death.

Re:Comparative advantage, not surplus.

[jaoswald]

Perhaps you've heard of this guy named David Ricardo?

Even if, as you claim, EVERYTHING can be made cheaper in India than in the U.S., trade is still MUTUALLY beneficial. Unless everything is made cheaper in India in *exactly* the same ratio, there will be benefits to specialization and trade.

Re:Comparative advantage, not surplus.

[lgw]

Does it matter? They've got 29% unemployment, and 1/10th our minimum wage. That's a hell of a lot of worker dollars to soak up before productivity means anything at all- and when you throw in the fact that they could be trading with China, which adds another billion workers and 1/100th our minimum wage, our productivity doesn't mean squat unless it's 100x better than the entire rest of the world in at least one item.

And yet, manufacturing capacity (if not jobs) is returning to the US from China every year - robots work cheaper than people. America has one huge advantage over India and China right now: we have infrastructure. We have reliable power, good safe roads, good telecom infrastructure, and universities capable of graduating world-class engineers in every corner of the country. China and India have this in a few cities. We still have a real advantage in producing goods that require more than just cheap mindless labor.

A factory with high-tech automation, reliable power, and reliable delivery of raw materials is going to outproduce a sweat-shop eventually, it's just a matter of technology. I know my company, for example, might want to move all of its engineering work to India ASAP, but it simply can't: India doesn't have the infrastructure available to it yet. Not enough power and telecom to move big test labs there, not enough engineers graduating every year to move design there at what we want to pay.

Right now, India simply can't produce *enough*. Any one item, sure, that's cheap, but the entire capacity of the country gets consumed pretty quickly and then what? It takes generations to grow infrastructure.

Either that, or it will be feudalism all over again- the robots will benefit the top 1% of society and everybody else will simply starve to death.

Marx predicted this exact thing. He's been wrong for over 100 years in a row, so pardon my optimism. Growing up, my family was damn poor, but we could afford shoes for everyone, more than one chair, "silverware" (not silver, of course) for everyone to eat with, and a car. There's wasn't a single working-class family who could afford any of these things at the start of the industrial revolution. Just about every manufacturing job that existed 100 years ago is gone today, and yet everyone is better off. Ain't technology grand?

Re:Comparative advantage, not surplus.

[OldAndSlow]

Have you ever taken a hard look at Ricardo's model? Especially at the assumptions? He assumes that there is no cost to switching from growing grapes to growing apples. He assumes that there is no cost in retraining grape growers to be apple growers.

That may have been a valid simplification in the early 1800s, but it isn't today. A semiconductor fab plant can cost in the neighborhood of a billion dollars. A degree in computer science from a name school can easily run $200,000 (tuition, room, board, books, etc, plus 4 years lost wages).

Ricardo build a model of comparative advantage; don't assume it is a law.

As a thought experiment, consider the quote "the United States should instead focus on India as a vital new market for American goods ..." and estimate how many of those American goods are actually going to be manufactured in China.

Re:Comparative advantage, not surplus.

[cartman]

Median income has nothing to do with minimum wage for basic industrial tasks. Also, PPP is a very tainted figure for this. The cost of a company to make something does not depend on the purchasing power of the wages they pay. The non-PPP figures are the only ones that matter for someone that wishes to determine the cost of doing business. PPP only matters when they want to buy something, not make something.

My original quote claimed that the 100x figure is incorrect both for PPP and non-PPP adjusted figures.

And the non-PPP numbers for median are about 40,000 vs 1300 (I'll let you guess which is which). That's over 30 times. It may not be exactly 100 times, but it is only 1/3 the 100, but is 5 times your difference, so he's more right than your PPP numbers.

No. The raw median wage in China is almost $2,000 and the figure for the U.S. is ~$33,000. That's ~16x. None of his figures were closer, since the figures he cited were completely incorrect and the figure I cited was correct (whether it was PPP-adjusted or not).

True, the unadjusted wage is used to determine whether outsourcing will be profitable. But it's the unadjusted wage of the potential workers in that foreign-owned factory, and not the median wage for the country, which matters. In fact, the PPP-adjusted figure probably understates the case.

Bear in mind that the median wage you cited was for China as a whole, which is very deceptive since there are tremendous wage differentials between different regions in China. Almost all of the the factories producing goods for export are along the coastline where Chinese wages are almost 3x higher than in the mainland (regulations in China prevent labor mobility). It's those workers, the coastal workers in the industrialized areas, that Americans are competing against--not peasants on collectivized farms.

Note that Chinese laborers in foreign-owned factories typically make >$1/hour (NON-PPP adjusted) which is nowhere near 100x as much as an equivalent American unskilled laborer.

Furthermore, programmers in India often make the equivalent of >$20,000/yr (NON-PPP adjusted) which is nowhere near 1/100th what an American programmer makes--more like 1/4th.

Again, we must compare American wages to the wages of those Indians he'll be competing against. Obviously a programmer isn't going to have his job outsourced to an Indian gravel-maker who works by hand, or an Indian farmer who uses a hand-plow. The American programmer won't have his job outsourced to the 99.9% of Indians who can't even program a computer, to say nothing of the >40% of Indians who aren't even literate.

Equivalent laborers in China or India earn more than 1/15th what their American counterparts earn, in raw (unadjusted) terms.

Actually, as I think about it, the US has a much greater percentage of wealth distributed through investments and other non-work activities. It could very well creep up to the 100x figure mentioned, just using the globally published and accepted figures, though I don't have enough time to run through them all and first glance shows you to be way off from the reality of the free labor in China.

No. I'm quoting median wage statistics and not per-capita GDP, therefore no adjustment is required for investments. (Not to mention, median income wouldn't much be affected by investments anyway). The median wage for a Chinese laborer along the coast who works in foreign-owned companies is closer to 1/10th what an equivalent worker makes in the U.S.

though I don't have enough time to run through them all and first glance shows you to be way off from the reality of the free labor in China.

No. Labor is not free anywhere, even in Bangladesh. Even if a laberor were property (i.e. a slave), still his labor wouldn't be free insofar as the slaveowner would have to pay for his sustenance and the sustenance of his pro

He's an idiot, but he's right this time

[realmolo]

At some point, in order for OUR economy to grow, we have to bring the rest of the world up to speed. Most of the world lives in poverty. That has to change.

Of course, until everyone is up to speed, shoving jobs to third-world countries means that developed countries are going to see a LONG period of economic depression. And, of course, the corporations and their CEOs are STILL going to get richer, becaues their labor costs will plummet at the same time their sales increase.

Still, it has to happen eventually. It's just gonna suck for the U.S. and Europe.

A few problems

[Anonymous Coward]

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.

I find it intriguing...

[Infonaut]

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.

Bush just doesn't get it

[pammon]

I remember during one of the Bush / Kerry debates, the question was posed "What do you say to someone who lost his job due to offshoring?" Bush's answer was "We're going to give you a scholarship to send you to a community college, so you can get an education." What a terrible answer - as if the problem with these people is that they don't have enough education! That really drove home the point for me. Bush doesn't understand this problem at all.

(Kerry, FWIW, talked about eliminating some of the tax incentives that encourage companies to offshore. At least he understood the problem and had an appropriate, if timid, response.)

Ya' know, I'm starting to think...

[swelke]

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.

A software guy speaks up.

[HellYeahAutomaton]

I have been programming software in C++ and Java for over 10 years now professionally. I love to write code, it is my passion and I'll be damned if I let ANYONE take away my dream of writing code for the rest of my life.

I lost my job to outsourcing. I was out of work for nearly a year.

It was hell, it was torment, and it was impossible to find work...until I outsourced my job search.

I was at wit's end until I was inspired by My Outsourced Life and I did something about it and landed a great job thanks to my friend "Steven" in India.

Sure, Bush's attitude is cocky because I strongly suspect he thinks that we are "better than" India; but the important thing to take out of this is : outsourcing is not going away, and you can either exploit it or let it ruin you.

The cocky part is the American spirit, for overcoming adversity in the worst of times, with hard work, ingenuity and creativity. Dedication to excellence in the work you do will keep you going, and if you want something badly enough you will find a way to get it.

Re:Editors Shouldn't Bitch, Their Own Company Does

[PygmySurfer]

Because everyone agrees 100% with everything their employer says and does, right?

What do we have to sell?

[khasim]

...I think there is a point to be made in the fact that we don't try nearly as hard to sell our crap overseas as foreigners do selling their crap to us. Outsourcing wouldn't be such an issue if we weren't the only people buying our stuff.

But what do we have to sell?

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.

When Americans No Longer Own America

[Philip K Dickhead]

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

Re:When Americans No Longer Own America

[cyber-vandal]

Superbly sums up a lot of what I think about the current world order. For those that will undoubtedly cuss me and the guy above as clueless, I want to be proved clueless, I want to be proved wrong, I want to be proved as just a paranoid nutcase, I truly, truly want to the world to become a better place due to globalisation. The thing is I don't believe it will; making your customers poorer is a suicidal business strategy for all but the likes of Walmart.

Re:When Americans No Longer Own America

[Vicissidude]

Well, I guess the solution is to nationalize the industry, the communists taught us that was a brilliant idea...

No, you're presenting a false dichotomy. The solution is to conduct fair trade instead of free trade and to not sell our national security interests to foreign governments OR companies.

Fact of life: Joe Consumer doesn't care that his jeans aren't made in America, he just cares for the $10 savings he got because they aren't.

Joe Consumer won't be caring about buying any clothing at all if his good paying job fires him in order to hire Apu.

Re:When Americans No Longer Own America

[cartman]

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.

If foreigners have exported products to us and don't buy anything from us in return, then they've given us free products.

Exports exist to pay for imports. Foreigners export products to the U.S. because they wish to buy capital-intensive American products. Foreigners do not export products because they wish to give us things for free.

Even when foreigners buy debt (instead of our products), that means only that our exports of products to them are delayed. And when foreigners buy American companies, that means they're investing in our economy rather than their own.

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.

As many European and Japanese companies have been bought by American firms. For example, Volvo, Saab, Mazda, Jaguar, Lambourghini, Maserati, and other car manufacturers are now owned by U.S. companies--and that's limiting our attention just to car companies.

Just because a company is owned by a Swiss firm doesn't mean its profits go to Switzerland.

So what if Europeans are investing here. Phrased another way, there has been a massive capital flight from Europe to America. Investment is leaving Europe at a rapid pace and setting up shop in the U.S!

Is it really such a problem if foreigners would rather invest in our economy than in theirs?

Re:When Americans No Longer Own America

[kgskgs]

Let me start with saying that I sypathize with every person that lost his/her job. That is hard. That sucks and if ever I could do anything about it, I would.

Also I appreciate open mind shown in USA. Most fair and impartial country on this earth. Perhaps I would not get such a fair audience anywhere else in the world.

Now let me tell you the other side of story.

There was a soft drink company called Thumbs Up in India. When the economy opened and Cocacola arrived, they tried to buy the company. When the company refused, Coca cola just baught all their products and sent to warehouse, and kept them off market shelves for a while, so people would forget them. Result? Evantually the Indian cold drink company gave in. Coca cola changed the taste of that product. It sucks now. Now it's all Coca cola.

The same thing happened to many many Indian companies. At many places, American companies did not need to play games. American products were far superior than their Indian counterparts. Obviously people switched to American goods. GM and Ford, losing here, are having time of their life in India. Because old Indian cars sucked compared to GM and Ford offerings.

Many Indian companies were closed, Indians lost jobs as well.

But evantually things stabilized, and bingo, actually turned upwards. Call centers, software outsourcing, people started seeing benefits.

And now people in USA are complaining. Perhaps many of the jobs lost did not belong to USA. They were just borrowed from India. I know I sound like Satan to your ears, but you should see the whole picture.

People in India switched to USA companies because for almost same price, they offered better quality. Now companies in USA are switching to Indian labour, because it costs much less for the same skill level.

Just a list of few Indian companies went bankrupt or got kicked in 1990s- Premier Automobiles, Murphy Television, Thumbs up cold drink. Can't remember more of the top of my head. But there are a lot.

Military equipment producers, OIL companies and such are having time of their lives in USA. Why not ask them to share their profits before blaming Outsourcing?

Dude, this is just other side of capitalism. Face it. You can't just have benefits of something and but not face disadvantages.

And I have strong faith in future of USA. This country thrives on innovation. Evantually Americans will figure the way out and in the process bring a whole new era. The same thing happened at times of Japanese auto makers, at times of South Asian electronics manufactures, the same thing will happen about cheap Chinese goods and about Indian call centers.

And don't throw that list of non USA companies owning USA companies. 53% rubber products? You guys fucking own GPS.

Re:IP

[gunnk]

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).

Useless to Argue

[tabdelgawad]

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!)

Outsourcing isn't bad, guys

[bigmattyh]

Outsourcing is not evil. It's not even a losing situation for those of us in the US. The fact is that outsourcing is the natural result of the constant shifting in how countries maximize their resources. India is a natural choice for American companies -- like Dell -- to outsource tech jobs, because there are plenty of people there who can 1) speak English, 2) do the work, and 3) do it for less money. Okay, so now you're saying, "Yeah, well, who cares about companies cutting their expenses? All that money goes into the pockets of the CEOs who are already ridiculously rich." Well, yes and no. But mostly no. Labor is always the most expensive item on a budget -- and that's why when times get tough, you see super-companies like GM and Ford and Boeing announcing thousands of layoffs. The overall cost of labor affects the bottom line -- especially in the highly competitive tech world, where the price of hardware is always coming down, but the cost of labor is constant or rising. Why do companies like Dell want to reduce their expenses? In Dell's case, it allows them to price their computers at a point that is much less than their competitors'. They sell more machines. If they don't have to pay their tech support $20/hour, they can move silicon at a faster rate, plain and simple, and the company can grow. If the company doesn't grow, plain and simple: it will die. And suddenly, you will have a lot more than a few tech support guys and engineers out of jobs; you'll have the sales staffs and accountants out of work, as well as the guy who runs the convenience store across the street from Dell HQ in Round Rock. The local Starbucks will have to cut back an employee or two. Guys, it's just a fact of the world economy. Some people will do the same work for cheaper. That genie's not going back in the bottle, and Bush is right: the alternative would be worse.

This form isn't part of a proper global economy.

[ShyGuy91284]

I agree jobs being done overseas is part of a global economy. But the current state of outsourcing is fundamentally no different to a company in the US then clothing makers having their clothes made in sweatshops overseas. Moral issues aside, that's ok, because we have moved from being a manufacturing based economy to an information based economy. But with them starting to move information based jobs overseas, what can we do now other then find jobs that might be under our ability? For outsourcing to be ok as part of a global economy, it would be done on the basis of skills. Country foo has better programmers then us? They should get our jobs then. It's as simple as that for a global economy. I have no idea about the quality India's IT skills, but I'm assuming they are no different then those of someone in America who worked hard to get their skills. And at least in the area of tech support, outsourcing is clearly hurting the quality of service. It seems that if I call tech support for anything, I can clearly tell if it has been outsourced due to poor email grammar or not being able to understand them. True, some may have been outsourced and I haven't noticed, but if someone can't effectively communicate with customers, someone else should have the job. And I have had no problem understanding professors with accents when others have complained, so you know it must be bad.

Re:Outsourcing complainers on Slashdot are hypocri

[lordbad]

Not all would change from that platform, but if it's a big country or corporation changing. You would find it hard to believe the account management people might lose their jobs as a direct effect? Or the indirect effect of lost revenues cutting workforce?

Sure it woulnd't happen every time directly, but lost of revenue is loss of revenue.

This is just ignorance.

[geezusfreeek]

I'm actually surprised at the number of negative comments this has generated. There are three main reasons I see for this:

• You don't like Bush, so the mere fact that he said it makes it bad.
• You don't know jack about economics.
• You are a programmer living in the U.S.

Firstly, Bush is promoting world economics, not just U.S. economics. Secondly, everybody always looks at politics and thinks "How does this benefit me?", but the fact is, most things the government does will not benefit you specifically. In the long run, you will benefit, but the effects will not be so easily traceable back to that policy you disagreed with so long ago. Promoting world economics promotes U.S. economics.

Outsourcing lowers the value of programming in the U.S. since it could be more cheaply acquired by outsourcing; it's true. Now, look past that. This lowers the number of demanded programmers in the U.S. (and the pay of those who do score programming jobs). Costs for software development is lowered, and the need for cheaper software is met. People who can't find jobs programming go on to find other kinds of jobs, those that are more profitable. Whenever a job is more profitable, that's because there is an unsatisfied need in the economy for that product or service. Overall, people will enjoy cheaper and more readily available products in every field, not just software.

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?

Re:This is just ignorance.

[Hee-Man]

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!

Re:This is just ignorance.

[Maxo-Texas]

I agree with a lot of what you are saying.

Two points.
1) It's not just programmers any more. It is -any- high paying job that requires a very expensive education to qualify for. Radiologists, para-legals, programmers, even lawyers. I.e. There is no job safe except upper level management, government jobs (especially with security considerations) and work that must be physically performed here. In other words, a huge swath of jobs are being shipped overseas with very few jobs left to replace them.

2) The same corporations shipping things overseas are having laws passed that create artificial monopolies so the prices of their products sell for between 10 and 20 times more in the US as they do in other countries.

It would be one thing if all the products we were purchasing were dropping to a 10th of the price, so that we could afford to make less (and thus compete with outsourcing better). But our high costs are being locked in while the very businesses that are doing this are taking advantage of labor that costs a fraction of what ours does- in part because they are paying a 10th of the prices we are.

It's a really nasty mix. I can only see it ending very badly when we pass below some crucial tipping point and basically collapse economically down to the levels of the other countries and can't buy the products at the artificially inflated prices.

And at that point, there will be no market for products made in these other countries. Essentially these companies are getting rich by mining america's wealth built up over the last fifty years.

Hunger in the US

[spun]

Here's a link to a USDA report on hunger in the US. Unfortunatly, it is on the rise. 11.9% of US households suffer from food insecurity, while 3.9% suffer from hunger. That's about 11 million people. But go on thinking everyone here is fat and happy, if that helps you sleep easier at night.

The media consists of corporations.

[CyricZ]

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.

Re:Not accurate.

[ObsessiveMathsFreak]

Go ahead, change the numbers around all you want. As long as you stick with possible values (ie. non-negative values), the facts remain the same. Namely that fact that one nation cannot always be the best at producing everything.

Yes it can. One nation can be the best at producing everything. It's 100% possible in theory. In practive however, of course the French will always make better cream coffee than Americans.

However, when it comes to mass produced goods like cars, computers, software, clothes, etc, etc, etc... China can and is best at producing these goods at the lowest price.

Economists love to fudge this stuff, but the reality is a lot of them are simply bullshitting and/or don't really know how things are going to turn out. Cheaper goods from China may or may not make things better for Americans, or for Chinese people for that matter.

The weightless economy is an ivory tower concept, that is consistently held up as an aspirational one. But bottom line, countries with a relatively high manufacturing and exports boom. Countries without don't. America is currently without, and seems most likely to continue withou for some time. All because some economist says that goods produced in sweatshops by serfs living a totalitatrian state should be allowed to freely compete with citizens in a prosperous democracy.

Jobs go to China for one reason and one reason only. It's cheaper.

It tells me something different ...

[Bearpaw]

Take a look at how fat people are in "poverty" neighborhoods, and that will tell you something.

It tells me something different than it tells you.

"How fat people are" in the US is a piss-poor measure of their poverty level ... except, perhaps, in the opposite direction that you're assuming. Due mostly to warping effect of agribusiness corporations and their reps in Congress have on the market, it's cheaper to be fat and malnourished in the US than it is to be slim and healthy.

Re:What about "informational" ads on TV?

[geoffspear]

You'd have to repeal the First Amendment to ban political speech.

I'd love to see all of the money taken out of politics, but in this case the cure is a lot worse than the disease.

Parity

[Cheeko]

I know this is going to get lost in the sea of posts, but here goes. I AM a tech worker with a college degree. I see people around me losing jobs to outsourcing every day. I personally hate the idea. At the same time I've made a point of studying the economic theory behind much of this.

The common thread I keep seeing intoned over and over in threads here is all the doom and gloom, that everything can be done cheaper elsewhere and jobs will go and go never to return. To some extent this is true, jobs will leave. Things ARE cheaper in India. However what people neglect is how market conditions change in the target countries. In India for instance, the demand for that cheap labor is so high, that already you are seeing a substantial increase in wages over even 10 years ago (its still very small compared to US salaries, but it IS rising). This is generating that middle class spoken of in the article. At the same time these same engineers are creating a consumer class and discovering a sense of entitlement. Doesn't all this sound familiar, oh yeah, its what happened in the US over a span of 50-60 years or so. The general concept behind globalization isn't that the US economy and work for is destroyed and impoverished, but rather one of the world economy reaching parity. 10-15 years from now, the overall cost of labor will be comparable, or close to comparable between india and the US most likely. Companies won't offshore to india, it will instead be to china, or russsia, or some country in africa. The point to the theory is the that haves and the have nots will come closer together in a global economy. Workers in India will eventually earn the same rights and standards of employment as the US and Europe. At the same time Europe and the US will learn how to make its workers cost less to companies. And while all this is going on, new economic powers will be rising in the way india is now. The process in it ultimate form would have many many nations all competing on even footing, but before that can happen the process of realocation of resources needs to happen. Its painful, but its not the end of the world. Sure people will lose jobs, but we as people will adapt and move on. As has been mentioned we AREN'T entitled to anything by right, we work hard, we do jobs, we earn money. The US unemployment rate for all the doom and gloom is still one of the best in the world. There will always be people who suffer do to economics, and whenever thos people are concentrated in one sector they will complain loudly (look at the manufacturing sector of the past), but those same people always make do and move on.

s/give you scholarship/remove existing subsidies/

[bigtrike]

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.

Unfettered Trade Leads to Oliver Twist's World

[Anonymous Coward]

If you don't believe me that an unfettered free market leads to conditions similar to the world of Charles Dickens, compare the conditions that Dickens writes about in Oliver Twist to the conditions in countries where sweat shops are prevalent. People in those factories work horendously long hours under terrible conditions. And if they raise their voices, they lose their livlihood. They have little or no power to influence the conditions of their lives. They are simply a resource that is to be consumed by a giant machine called a corporation. It's all about power. The ability of the powerful to force others work for almost nothing. It is the antithesis of democracy.

In the early twentieth century, there was pressure to control the private interests who exploited people for their own gain. Democratically elected governments took power from the private sector. They raised taxes on corporations. To prevent corporations from fleeing to friendlier shores, the flow of money across borders was restricted, and tariff barriers were raised. What followed was a period of unprecedented prosperity in North America and Europe. Money that would have gone to building extravagant mansions for the extremely rich instead went into building roads and hospitals and fire stations. Corporations were prevented from acting badly by powerful governments, who in effect acted as police forces on corporations.

Today there is a move backwards to the mean conditions of the 1800's. Money may now flow freely across borders, and so corporations may flee governments that dare to restrict their activities. Democratic governments are under relentless pressure to lower taxes on corporations, tipping the balance of power away from the public interest and towards the private sector. And so we see the reappearance of Dickensonian sweat shops around the world, in the places where governments are powerless, or in collusion with the private interests. It is in these sweat shops that we see the nature of the corporate machines laid bare. There is no concern for ethics or morality. There is only profit.

I am not arguing against trade. I am arguing for regulated trade, in which democratic governments actually have the power to penalize those in the private sector who act badly. There must be a force to act in the Public Interest in our society, and that force is a well funded democratically elected government.

I agree with him on this issue

[jocknerd]

I think the man should be impeached for all his lies, but at least on this issue, I agree with him. Globalization is a reality. Adapt or get left behind. Read Tom Friedman's book, http://www.amazon.com/gp/product/0374292884/qid=11 41416047/sr=2-1/ref=pd_bbs_b_2_1/102-0508254-23673 29?s=books&v=glance&n=283155The World is Flat: A Brief History of the Twenty-First Century

Futility

[rumblin'rabbit]

Quite apart from any moral questions about outsourcing is the fact that opposing it is futile.

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?

Lyndon Johnson and Brown and Root

[maynard]

Brown and Root was a small construction company in southeast Texas formed in 1914 by Herman Brown with his brother-in-law Dan Root. Mr. Brown was a conservative and staunch opponent of the New Deal when he befriended a congressional staffer by the name of Lyndon Johnson in the early thirties. Johnson was ambition and wanted up the ladder from a staff position to an elected official. Herman Brown made that happen. With a lot of money. In exchange, once Lyndon won a seat in congress, he arranged for Brown and Root to build a number of public projects such as the Marshall Ford Dam, and the Naval Air Station at Corpus Christi.

Lyndon wasn't much for house debate, nor was he a skilled lawyer, so writing and pushing through legislation was particularly difficult for him. Which for a congressman is a pretty serious drawback. But Lyndon was a big - physically imposing - man. And he had access to a lot of money through his connections at Brown and Root. So pretty soon Lyndon was passing contributions around to various Democratic congressmen in threatened races throughout the country. Because of this Lyndon grew very powerful in a very short time - powerful enough to attempt a run for Senate only two years after having won election as a congressman. He lost that first bid, but within a few election cycles large numbers of congressmen owed their seats to his arranged donations. Lyndon had the choice of committee seats at his disposal, and quickly became close friends with then congressional leader Sam Rayburn.

But Lyndon still wasn't satisfied. He wanted to be a Senator. So off to his friends at Brown and Root asking to finance a new election bid for Senate. This time he won, but only because he cheated. Didn't matter. Once again he climbed the ladder from junior Senator from Texas in 1948 to minority leader in a single six year term (the Democrats lost the senate majority during the election of '52). He did this through funneling corporate contributions, much of which came from Brown and Root.

Of course, we all know how Lyndon Johnson wound up as President. He was chosen to be JFKs vice presidential nominee in order to shore up the southern vote. Nobody expected him to have any power in that position. But JFK was assassinated in Dallas Texas on Nov 22nd, 1963 and soon thereafter Johnson assumed the Presidency.

Who was there right behind him scoring military contracts left and right? Brown and Root. Soon to be named Kellog, Brown and Root. And then soon thereafter to be purchased by Halliburton.

We all know who Halliburton is, don't we? History sure is a strange thing...

See the works of Robert Caro for a detailed history of Johnson and his connection with corporate financing. He was arguably one of the founders of this whole cross state campaign financing fiasco.

Re:Bush just doesn't get it - Maybe you don't?

[faraway]

Maybe you just don't get it? Job outsourcing has happened and will happen always in a market economy - hell any economy. You are not owed a job by the government or by any business. I grew up in a totalitarian communist regime, and coming from that background, the free market is a gift from Heaven. Outsourcing aside, your job, and only job, is to figure out what the market wants and supply it - if that means re-education if you lose your job to an outsider (and in most cases it does), then that is what you have to do. Either your company outsources its jobs, or another somewhere else will, because if they can produce something cheaper for which there is a demand, they're the ones that will get the business, while we'll be stuck with useless artificially inflated and OVERPRICED goods that we can do nothing with but sell within our local economy - hence no exports. The developing world (which most of the world is) is looking to buy cheap goods because that's all they can afford. As in the industrial revolution and the aftermath where industrial jobs were outsourced to other countries, science, technology, and invention replaced those jobs with new jobs that created demand for a new set of goods, and a new job market. Stay ahead and informed or get left behind. This does not mean you have to cheat to get to the top.

If you can catch five rabbits a day with your spear and someone else in another tribe has a bow and arrow and can catch thirty a day and trade them at a lower cost than you to your tribe, it's your responsibility to figure out a way to catch more rabbits at a lower expense - it is NOT your Village Chief's responsibility to outlaw the extra meat to protect your inefficient use of time and resources. It's time for you to find a way to get more rabbits - afterall, the benefits are crucial to all. If you're smart and watch the trends, you'll always be a step ahead.

One thing that we have fallen a behind on in the US, which is in part due to the conservative nasty policies of the Bush administration is Science and Technology. That's the only thing that will keep us competitive on the global market. For example, when a foreign entity develops breakthrough cures to all types of illnesses from research on stem cells which is really being hampered here in the US by conservative sectarian BS, they'll have a wonderful lucrative business and a monopoly on the business. Maybe when the technology becomes established and they've developed newer technologies, they'll outsource some of their lesser jobs to us - because we were too busy whining about losing some job to an Indian programmer who could do the same job much cheaper.

Whiny Americans. Stop bitching and create new things to help all of us.

My job is under threat of being outsourced, my boss brought it up at a meeting recently. I suppose it's time for me to do something that distinguishes me from the potential cheaper employees or get left behind. Imagine that - I have to work to stay ahead.

Marius

OT: I Apologize

[Whatsmynickname]

Using this political forum, I simply want to apologize to all you left wing nuts and say "you were right". I give up trying to defend anything Bush has to say anymore personally or on-line (not that I've done it here recently).

Between the destabilization / chaos going on in Iraq as the Bush admin. clearly didn't plan or forsee what was going to happen after Saddam, and now the absolute, irrevocable proof that Bush does lie and cover up (in this case, Katrina), it's getting REALLY HARD to get behind the president on anything these days... It just makes the Bush admin look like a bunch of inept, CYA idiots whose guiding principal is cronyism. When Bush opens his mouth, most non-koolaid drinking conservatives should now wonder just what agenda does he have.

BUT, I'm STILL not voting Democratic because (A) they are just as bad as the Republicans, and (B) they very much want to take away the right to persue my hobbies with all the strength they can muster (ie, off-road vehicle driving).

Lets save USA and NOT OUTSOURCE everything

[JavaManJim]

May I suggest that all slashdotters consider this thought? Especially any economists. Read the concept, note it down, then re-read your notes before you go to bed. Upon awakening see if any new ideas have surfaced and respond. OK, here goes.

The USA should safeguard its people from troubles anywhere in the world. Therefore I suggest that the USA should keep and nourish in the USA some minimum, perhaps of 20-30%, of the industries that are outsourced. This would not be entirely cost efficient because its not as purely efficient an economy that eternally chases the lowest price. Take for example if a considerable amount of international steelmaking capacity goes away, then we should have sufficient capacity to supply the minimum level. Another example might be like maintaining a mimimum level of heating in the winter to kind of survive - like 45 degrees. Here we are not looking for comfort but survival. Flu vaccine is another area that would need to be supported. In the 1970's we had (I believe) 24-26 companies that manufactured flu vaccines. Now we have four which is barely enough today to supply and protect from seasonal type A viruses. I guess Malcom Gladwell's "Tipping Point" might provide another perspective of how to picture the minimum level needed.

This would also turn the 'just in time manufacturing' on its head because a minimum amount of raw materials and goods would have to be kept in the pipeline. Of course employment and many areas of the economy would be affected.

Here is an off topic suggestion is to make slashdot more like the better blogs are with insightful and thought out comments rather than what we typically see. Perhaps rather than react to stories (i.e. current mode), slashdot could request think pieces on various ideas then we could comment on these.

Thanks,
Jim Burke

Let me get this straight...

[terrahertz]

"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?

But how can I send it?

[silicon dad]

Last time I tried to send a chip to India, duties, taxes, & paperwork came to 100x the product value. Big companies can game this, but I'm just a start-up.

Outsource Everyone

[Phoenix666]

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.

Ruined in the first sentence

[snowwrestler]

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.

Where do they keep this silver? In what financial instruments is it invested?

Money does not just disappear when a person sells something for a fat profit. They invest that money in other instruments, in effect simply transferring their ownership from one set of companies to another. Foreign-based companies may own and operate in America more and more, but more and more the wealth of America is invested in foreign-based companies because that is where the growth is. So who owns who?

Not entirely true

[willisbueller]

Lamborghini - Owned by Audi (not American)
Maserati - Owned fully by Fiat (not American)
Just thought I'd point it out. The American Big 2 (as the 'third' is now owned by Germans) are also dying a slow painful death.

/Anyone else seen the 2006 Challenger concept? moly. Go Germans!

Back to the rest of your post. There hasn't been a massive capital flight from Europe (or anywhere for that matter) to the States, in fact it has been quite the opposite, hence the dollar dropping against everyone else so rapidly. I'm not sure how anyone can justify this deficit as ok. It is short-sighted suicide. Unless of course this Iraq war seriously pays off and keeps up swimming in oil for longer than the rest of the world. But from how pissed off the locals are (in Iraq) I don't think it's going to provide us with much.