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Obama Says Offshoring Fears Are Unwarranted
alphadogg writes "The perception that Indian call centers and back office operations cost US jobs is an old stereotype that ignores today's reality that two-way trade between the US and India is helping create jobs and raise the standard of living in both countries, US President Barack Obama told a gathering of business executives in Mumbai on Saturday. President Obama's remarks come after some moves in the US that had Indian outsourcers worried that the US may get protectionist in the wake of job losses in the country. The state of Ohio, for example, banned earlier this year the expenditure of public funds for offshore purposes. US exports to India have quadrupled in recent years, and currently support tens of thousands of manufacturing jobs in the US, he said in a speech that was also streamed live. In addition, there are jobs supported by exports to India of agriculture products, travel and education services. President Obama, who is in India on a three-day visit, said that more than 20 deals worth about $10 billion were announced on the first day of his visit."
The H1-b fraud is what kills it for most Americans that stumble upon offshoring's negative qualities.
You don't go to India for US jobs, especially when you're millions of US jobs in the hole.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
The reality is that those jobs are already in India and aren't coming back.
(Yes, I'm aware of the less than a handful of companies that reversed outsourcing of their call centers after constant complaints from customers about not being able to understand a word out of "Kevin" from Bangalore's mouth. Outsourcing firms are much better with the English these days.)
"Create job abd raise the standard of living in both countries".
This statement is only true if you count the rich getting richer in the US. I fail to see how losing your middle class income job to outsourcing raises your stadard of living.
If I live in a more developed country, why the fuck should I tolerate this? Being a sovereign nation means having the ability to regulate trade up to and including stopping it completely. Since, as you freely admit, foreign trade is utterly screwing us over, that sounds like a pretty good idea right now.
It's ironic that people like you voice dissent at the Indian off shoring situation when you had no problem off shoring our manufacturing jobs to China by lining up at Walmart's feeding trough.
Is President Obama taking into account MY personal costs when I require internet tech support and have to use my cell phone minutes? Not to mention the difficulties of the language barrier when you can hardly understand what they're saying due to their thick accents that further complicates matters and takes up yet more of my valuable time? Does he understand that they can hardly understand me either, so we go back & forth repeating ourselves trying to resolve the issue, taking up yet more time and costing ME more money?? I think not.
What he said about India could have well applied to China more, as the US exports more products to China than to India. But he, and the other politicians, did not say the same things to China. The only reason being that China is now the main competitor and so we have to demonize it and please countries like India and Vietnam, exactly like how we pleased China 30 years ago -- opened up our market without asked for the equivalent level of opening up, established relation with Mao's regime which was a million times more suppressive than the current one, and kicked out Taiwan from th UN, in order to fight against the then biggest competitor -- the Soviet Union. The problem with this strategy is that while we may constraint one competitor, we are creating another new major one for ourselves down the road. And we the common people pay the costs. History repeats itself again and again.
The US trade deficit with India is already over $7B this year through August; heading to top $10B this year. That will be among the highest annual deficits, though Bush/Cheney got deficits as high as $12B+. August 2009 saw the only monthly trade surplus with India in well over 20 years, $34 million; the rest of the months total to something like a quarter $TRILLION more spent on India than India spent on the US. It's obvious that the parallel growth in the US and India leaves the US with less money from our jobs and more money in India for its jobs.
Of course, the corporate profits on all those jobs are not counted in trade stats. The real competition isn't between US labor vs Indian labor. It's between labor in either country, and the corporate owners who run the system, keeping the profits among themselves and their banker partners.
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The question is what happens if you had to hold the H1-b/etc. candidate to the same standards(and qualifications) as the US one? If firms like Patni can't prove that the foreign candidate can meet the same (impossible) standards, they haven't proven that a US citizen can't do it.
Of course, that might mean that the qualifications get skewed to include language proficiencies and such things that US citizens obviously can't do. That could be addressed by having them act in good-faith towards the citizen, and hire them. Then give the hired person a bit more power by allowing them to report attempts to circumvent (e.g. their projects are designed to fail).
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
It's a disaster, it's always been a disaster. Managers get their bonus based on cost savings regardless of how much it wrecks their company in the mid-long term.
And Toyota and Honda assemble cars in the U.S. Sometimes you just gotta do stuff locally.
You lost me at "tax and spend". We should get past bumper-sticker assertions, especially when they're not even right. I guess "tax less but spend more" isn't as catchy, but it seems to work for the Republicans.
My comments are my own, and do not represent the views of my employer, my spouse, my children, or my cats.
And Toyota and Honda assemble cars in the U.S. Sometimes you just gotta do stuff locally.
And other times it's purely to increase PR.
The rest of the world is evolving rapidly into highly educated, highly industrialized, highly technological countries that resemble the west - in certain parts and certain ways, anyway. The more similar their productivity is, the more similar standards of living they can demand but for a long time a series of favorable conditions and network effects have kept the US in a solid lead. The balance is shifting, but to say that it actually flows from one country to the other is fairly misleading. You could halt trade but it wouldn't halt these countries from modernizing, and they would also retaliate.
The US currently has a very negative trade balance, meaning it imports far more than it exports. If it were to close the borders, the US would hurt the most. Medium to long term that could mean opportunity for domestic industry, but the short term would be a substantial drop in the standard of living as many goods become expensive or even unavailable. There was a time when a trade boycott with the US would be dire but today if you can maintain trade with the EU, Japan, China, India, Taiwan, Russia and so on most countries would do fine. Alternate suppliers of almost everything now exist outside the US.
In short, the US is no longer in a position where they would have anything to gain from going protectionist. They'd be their own little isolated market of 300 million people while the world market - even subtracting the billions that are too poor to really participate - is much larger and would simply outpace the US. That's the nastier parts of the free market, once you've let it loose you might in the end become the victim of it, having to adjust your wages and standard of living to fight for jobs just like everyone else. But if there's one country that has no right to complain, it would be the US...
Live today, because you never know what tomorrow brings
Solution: Why not raise our import tariff rates to match that of our so-called trading partners?
The Christian Right is Neither (Christian nor right). See: Matthew 23, Matthew 25, Ezekiel 16:48-50
He is what he is, another tax-and-spend Democrat ....
I'll take that over the "borrow and spend" Republicans any day. Cash and carry. It's not good - but it's a little better.
And people wonder why I "throw my vote away" on Libertarians.
RIP America
July 4, 1776 - September 11, 2001
He is what he is, another tax-and-spend Democrat with delusions of grandeur like all the rest of the Washington crowd, and we're getting precisely the leadership for which we cast our votes. I did my research, and had a pretty good idea how he was going to turn out, and alas, I was not wrong.
You sure did your research. For the past 30 years every Republican president has increased the debt while every Democrat has decreased it. Damn those tax and spending Democrats and their lowering of the national debt. Here's a clue: stop repeating unfounded talking points.
You didn't say shit for two paragraphs. "Tax and spend Democrat?" You left a little Limbaugh vomit dripping from your cheek. Might want to hit that with some sanitizer.
The bottom line is that Bush was a complete fucking disaster. He lowered taxes and started two intractable wars, despite making campaign promises to avoid nation building, which are going to end up costing our country 3 trillion dollars. He refused to balance the budget after making campaign promises to do just that. He refused to regulate Wall Street, and eliminated the one guy in the Treasury department who had the balls to call him what he was: unquestioning and incurious. He appointed a witless crony to run FEMA with disastrous results. He failed on the economy, he failed on the war on terror, and he failed to uphold the constitution.
When people asked what they could do to help their country, he literally said, "go shopping." This is not leadership. Erasing the very foundations of our personal liberty with the PATRIOT ACT is not leadership. Ordering the torture of prisoners is not leadership. Pretending that the Iraq war would cost 50 billion dollars is not leadership. Not telling your citizens the real truth about war and the costs in honor and treasure and blood is not leadership.
Obama is no saint, but at least his cronies have two brain cells to rub together. He may be another member of the Business Party, but at least he has a slight interest in not pissing on the middle class and telling them that it's just raining.
Bush is a fucking disgrace, probably executed the worst eight years of foreign policy decisions in American history, and none of your historical whitewashing will change that.
Solution: Why not raise our import tariff rates to match that of our so-called trading partners?
Because, obviously, that would be Communism.
25% Funny, 25% Insightful, 25% Informative, 25% Troll
> IBM alone has hired 80,000 people in India in the last 8 years.
You say that like it's a bad thing. It isn't.
Those 80,000 people are no less deserving of jobs than you are. This comes as a surprise to most Americans, but they are also human beings. Many of them probably have a big step up in life because of these jobs.
America is not a competitive country, and it makes little sense to staff new jobs there. Labour is horribly expensive, there are stifling regulations and red tape, and the populace is increasingly uneducated in advanced math and science. Really, the only rational decision for the CEO of a multi-national company like IBM is to shift their focus outside of the USA. No one is "entitled" to a job. If you can reach a mutually acceptable agreement for employment, then great! If not, IBM doesn't *owe* you, even though that's what most Americans appear to think.
This is not a bad thing. It puts food on the tables of 80,000 people in India. That's a *good* thing.
While I understand your position, the statement "We aren't a group of chump manufacturing people" highlights the problems with many people's thinking. For decades we off-shored manufacturing jobs, and the general sentiment from college educated white collar workers was "Sorry, that's the way a dynamic economy works, you need to upgrade your skills." Thus, given that this way of doing business is now biting you in the ass, I'm surprised that you still think you are so different from "chump manufacturing people".
The problem with our economy is that we are growing the classes of people who are fundamentally unemployable. While it's nice to say you need more training, the fact is that many people will never have the skills to be a software architect or a Hollywood director or a Wall Street banker. For millions of minimum wage people, blue collar workers, and growing number of white collar workers like paralegals, programmers, etc., capitalism is not working (and that doesn't mean I think any of the other ...ism bugaboos are the answer)
Solution: Why not raise our import tariff rates to match that of our so-called trading partners?
Because the politicians (and make no mistake, I'm talking both major parties in the U.S.) are bought and paid for by the multinational corporations. They have absolutely no consideration for the trade deficit, or the standard of living for citizens, as long as they can profit from the situation.
Unfortunately, meaningful economic changes will not occur in the U.S. until there is a large shift in the way voters choose elected officials which allows outside independent candidates without connections to lobbyists to succeed at the ballot box.
Explain to me the effective differences in terms of actual fiscal policy between modern Democrats and Republicans.
When the GOP demonizes "tax and spend" as the other party's problem, they mean "spend on domestic social programs" and deliberately exclude US military spending. I think that's a pretty accurate summary, actually.
When you include US military spending as part of "spend", you will find that the GOP is worse on "tax and spend" than the Dems. They started a war that costs the US $1B a day, that has lasted 8 years, and provided no way to pay for it. That is a more egregious "tax and spend" program than any social program the Dems have initiated, "Obamacare" included.
If the GOP proposes a balanced budget that included the military budget and preserving Social Security, they'd be worth listening too. I expect that if they fail to produce an actual budget like that, they will again be voted out in 2012.
OTOH, if they do produce such a budget, Christ, I'll vote for them myself.
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Why do companies think they deserve to sell the same product to Americans for 10 times the price it sells for in the third world?
Because they can. Stop paying them their asking price.
You lost me at "tax and spend". We should get past bumper-sticker assertions, especially when they're not even right. I guess "tax less but spend more" isn't as catchy, but it seems to work for the Republicans.
Fine. How about "borrow and spend"? Because that's what he's doing. Is that an improvement over "tax and spend"? The reality is he's doing both.
"He" who? George Bush? George H. W. Bush? Ronald Reagan? Each of these Presidents tripled, doubled, and quadrupled the national debt while in office, and each pretended to run on a platform of fiscal responsibility. The only one who hasn't in the past thirty years is Clinton and, to be fair, that really only happened because he got lucky with the economy.
Right now Obama is running up the debt because that's what you do in a recession. Now, will he turn around in two years or so and put the brakes on spending? Maybe he'll try, but I doubt the "fiscally responsible" Republicans will let him, unless the Tea Partiers break ranks and actually let taxes rise and spending fall like they were elected to.
If I live in a more developed country, why the fuck should I tolerate this? Being a sovereign nation means having the ability to regulate trade up to and including stopping it completely. Since, as you freely admit, foreign trade is utterly screwing us over, that sounds like a pretty good idea right now.
Because if you had to post on Slashdot using only domestically developed CPUs on domestic motherboards with domestic memory chips running domestic software communicating over domestic networking systems, speaking domestically developed languages and sharing domestically developed ideas, and so on and so forth, you'd be roasting wild squirrel over a cave fire and grunting.
Human beings advance together or not at all.
That doesn't get rid of the fraud, killing the entire program and regulations will.
What you suggest only leads to more disposable & desperate workers.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
That still doesn't fix the lack of jobs for US citizens. It only encourages more fraud, and the $20k becomes a hostage ransom.
The only solutions that work are ones that put US citizens first and foremost, even at the expense of business.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
You're just making the qualifications overkill so you can create a "lack of qualified workers" out of thin air.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
It encourages companies to move U.S. jobs overseas. I have seen first hand the decisions being made due to this terrible law.
> Train the US citizens first
Americans do not want training. You can see this by poking your nose into any science, math, or engineering graduate program in the nation.
When hiring is at will, they don't have to give you an excuse for not hiring you.
Unless you can prove discrimination, you'll just have to accept that US companies are bags of sleaze that will happily screw you over to save their own pockets.
they deserve jobs India can do for a cheaper price?
Because they don't do them as well.
Obviously people in India have the same capacity as people in the United States, but they have social, communication, political and economic challenges that prevent them from performing acceptably. Their education system encourages rote learning over problem solving, and cramming is common.
It often takes as many developers to create specifications for offshore developers as it would take to code it in the first place.
No it doesn't but your worry DOES show the real problem the US has.
There is some believe working in the US that makes it value to top. The interesting jobs, the well paying jobs. But that is not what the economy, the boring local economy, runs on. It runs on truck drivers, factory workers, construction, repair. This is what keeps that majority of the population employed. Silicon Valley, Redmon, Wall Street do not.
Obama, and he is hardly the first, seems so pleased with 10 billion in orders. But how much of that money flows straight back out again because to produce those orders the US needs foreign goods? And those 10 billion are petty cash for the US. Meanwhile far more money is lost with outsourced call centers year in year out.
And no, outsourcing a call center will NOT cost the country a fortune, just a local community. A local community that can't then tax the local salaries and use those taxes to fund local education, local road maintenance etc etc. Outsourcing is not about a cripling injury that instantly kills the economy. This is a slow bleed that isn't stopped.
The call center goes, the local catering van can't break even anymore. The locals find far lower paying jobs and make ends meet by buying cheap Chinese imports instead of higher quality American goods. More and more American business got to cut costs to be able to meet the lower prices. They do so by outsourcing production to China and yet more Americans have just a bit less to spend.
It ain't complex to see, but if you believe in Wall Street as a religion then this can't be. This is not how the market, the magic fairy market, is supposed to work. Obama, and democrats and republicans with him, is saying "let them eat cake". The famous saying that started the revolution showing that the ruling elite didn't have a clue about what was really happening. It is after all not in Washington or Redmond or Wall Street that the job cuts are hurting the most. Oh, they might have a bad year, but not decade after decade in which a factory town turns into a ghost town. How many of the powers that be come from Detroit?
Yet the simple people, like the poster above think H1-b is the issue. Yeah right. The US has 300+ million citizens, and how many immigrants on these things? They are irrelevant. This is just the Redmond, Silicon Valley etc job. The get a lot of attention, but they don't keep the heartland working. Producing.
Scream at the immigrant worker while another factory is shipped lock stock and barrel abroad including every single job. SethStorm is like a frenchmen who reacts to "let them eat cake" with: "But I don't like cake."
But you don't have bread let alone cake.
IT has done this a lot. Thinking that they would be save from the export of jobs and then it turned out those dirty filthy foreigners could not just knock out cheap goods but cheap code. Boohoo, now our jobs are going...
Well, you didn't protest when every item in Walmart came from China, who is now supposed to care the next version of Windows comes from China?
And don't you worry, the decline will be so slow and the average American so attached to his large house and larger car that he will bend over backwards to keep up with payments rather then protest. Because if you strike or protest, you miss a payment and then that SUV is gone.
American citizens have managed to enslave themselves to Wall Street thoroughly. Willing slaves with guns. If you wrote this down in a book of fiction, nobody would believe it.
MMO Quests are like orgasms:
You may solo them, I prefer them in a group.
America is hardly the place where prices are the highest. In Norway or Denmark it's around 50% higher.
Correct, Obama is not the politician the American people hoped for, but he is what a pragmatist would expect. He could not get elected without owing several very powerful (wealthy) individuals and corporations no matter how much individuals gave to the campaign. He can not change a power structure that has developed and entrenched itself since 1776, at least not in two years. What he has done is concentrate on the one goal he had above all others, health care reform. This by itself raises the standard of living in the US for middle class Americans who make up the bulk of the source of both tax dollars and GDP. However, with the complexities of Washington and the perversely unyielding stance of the Republicans the White House has not achieved what the people who supported him expected Obama to achieve. Thus we had the backlash in the mid-terms. More of a throwing out of the incumbents over disappointment rather than enthusiasm for Grand Old Party candidates (in a two party system who else do you vote for when voting someone out?).
It seems that a new party needs to be created, Democrats being ineffectual even when owning both houses, and the Republicans denying any help to the people (failing to pass unemployment extensions as an example) and screaming small government and less spending while doing neither. The Tea Party seems to instinctively know this, however, judging by the members, they certainly did not seem to plan it in a planned,
sober or thoughtful way. America can use a third party but it will have to one that does not preach what seems to be thinly veiled anarchy (by the government, not the people) with a mind set bent on starting world war three. The TP are feeding off of the opportunity that the average American distrusts and fears the government. In Washington state the people voted down I-1098, which would have created a tax rate of 5 percent on annual income exceeding $200,000 for individuals and $400,000 for couples, and a 9 percent rate on income that tops $500,000 for individuals and $1 million for couples and cut the state portion of personal property taxes by 20 percent, about a 4 percent reduction in the annual overall property tax bill. Also, I-1098 also would have exempted an 118,000 businesses from the business-and-occupation tax on gross receipts. All of the money was to be spent on education (70%) and healthcare directly benefiting the poor and middel class. I-1098 lost with more than 65 percent of voters rejecting it, losing in every county. Obviously it was not only the people earning more than $200,000 that voted against it. My brother-in-law lives in Whatcom county Washington and I asked him why hew voted against the initiative. He said that if the state started to tax the rich they would not stop and soon he and everyone else would have to pay more income tax no matter how little they earned. He, like the majority, does not trust the government and the system in place is not working as anyone/everyone wants. But, it is stable and works to a degree that the standard of living in the USA has gone from thirteenth place in the United nations Human Development Index (HDI) list in 2009 to fourth (although in the Inequality-adjusted Human Development Index the USA places 12th) in 2010.
This leads us back to offshoring:
Since FDR reduced government controls of business in order to stimulate the economy in the thirties there has been less and less direct government control of the economy which, of course, led to the banking collapse of 2008-2009. This also caused more and more businesses to be able to move operations offshore or over border. Many large Manufacturing companies like GM increased profits (or be more competitive - depending on who you ask) by moving operations to Mexico. Oregon based Nike does not produce a single shoe in the US. Almost the entire US agricultural business is completely dependent on Mexican labor. IBM, Intel, Microsoft, and other IT firms have made large investments in India and other countries.
The American economy is no longer based
Nobody deserves anything except for a chance to compete. The problem is that some people don't understand why "India can do for a cheaper price".
1. Cost of living. It is very expensive to live in US. Does mister Obama think it is a good idea to lower our cost of living to India's rate? I hope not, because it means average Americans will have to live as an average Indian or even worse. Actually much worse.
2. In most cases the comparison is not apples to apples. At least in IT it is very often efforts are counted in man/hours. Is 1 US man/hour=1 Indian man/hour? When confronted, the management would say something like you can hire N workers in India for the price of 1 worker in US. Are they going to produce the same quality product? Is there an extra cost of managing those "extra" workers? Is there an extra cost of having all those people spread all over the world? Where are the loyalties lie for those offshore workers? Do they work for the benefit of the company or the outsourcing company?Is there a cost of lost business when deliverable schedules are blown and the quality of the delivered product is horrible?
The freshly minted MBAs are taught about the pros of the outsourcing but very few even more seasoned MBAs actually think about cons. It is always thought as a no loss strategy. The reality is much more complicated than the case studies, some of which are produced by paid shills.
Because we have a set of standards and/or morals that dictate that our workers get certain rights/priveleges/etc. Such as, we don't think it's right to force people to work their fingers to bone for $0.10/hr. Instead, people believe in something called a minimum wage.
Now, don't get me wrong, I'm not necessarily saying I support/believe/defend the minimum wage, I'm just pointing out that so far, the majority of our (read "USA") society has dictated that we have some sort of minimum wage.
We'd be foolish to think of the issue as so simple as just pure economics.
Why do companies think they deserve to sell the same product to Americans for 10 times the price it sells for in the third world?
If you could sell it for 9 times, you'd win the market, so go do it if you are so smart!
The truth is that most imports are incredibly cheaper than the cost of the same goods produced in the US. They have enabled us to live with a far higher quality at the same income level.
When hiring is at will, they don't have to give you an excuse for not hiring you.
Yes, but this is not hiring at will. They're documenting that they tried and failed to hire U.S. citizens, in order to meet the administrative requirements for hiring H1-Bs. If you can prove it's not bona fide employee search, then you can prove they're breaking the law.
It's not easy to prove, but something like that Cohen & Grigsby video, or similarly incriminating emails, could prove it.
Even when they are caught red-handed, I'm not sure what happens next. I don't think you can force the employer to hire you. I imagine the INS might be able to fine the employer (though not as much as the damages for downloading music). If it's fraud they might be able to send the employer to jail, but there's a very high evidence standard to convict someone of a crime.
They might be prosecuted by an honest federal attorney, and tried before an honest judge. Stranger things have happened.
Well, maybe not.
The ICE is busy deporting Mexican college students who have been in this country since they were 5 years old.
Of course, that might mean that the qualifications get skewed to include language proficiencies and such things that US citizens obviously can't do.
Horseshit. ENGLISH is the DEFAULT language of international business. Everything else is a regional pretender that is marginal at best.
Inflated or for that matter deliberately impossible requirements. I've seen job ads that were packed with enough requirements that no one was likely to fulfill them, including one that demanded "experienced with FrameMaker 7.7". Adobe never issued a 7.7, they went from version 7.2 to 8. I called the shop to ask them about this.The recruiter insisted that 7.7 was absolutely necessary and mandatory and the client used it and specified it. Clearly this was a phony screening excuse in operation. I've also seen ads requiring 6 or 7 years of experience with Web technologies that have existed for only 2 years. All too often see such ads from Indian-run agencies so I expect there's a hidden agenda to bar all but the desired pre-selected candidates.
6-7 years of experience in technologies that are only 2-3 years old.
10+ years of experience with operating systems that are less than 5 old.
Version-number-specific job requirements for a version of a software package that never shipped or never even existed (e.g. requiring experience on version 8.5 when the company skipped straight from 8.3.4 to 9.0).
Every goddamn "certification" known to mankind, including several not offered in the US or that are no longer issued.
All this, and more, can be found on the "job requirements" of any company claiming they "need H1-B's" because they "can't find qualified Americans." Microsoft makes a daily practice of it, for instance.
Ok companies can search the globe for the cheapest possible labor and tax benefits.
Can I do the same?
Can I pay $1500 a month rent, pay $1,200 for student loans + other expenses for $6/hr? Indians get free eduction, health care, and much lower rents. I can't move to India because the Indian government actually cares about protecting jobs for its citizens unlike my own. Now tell me how that is fair? It is not.
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Why can't IBM employees and Americans move to India and work there?
I'd like to buy homeland for our 10 million people. http://twitter.com/mahadiga