Posted on 02/19/2004 7:03:48 PM PST by dennisw
Outsource the work of our economic advisers
I read that my first job after college is being outsourced to India. Reuters Ltd., the wire service, is hiring workers halfway around the world to report on American companies' earnings, dividends, oil discoveries — anything that could move a company's stock price. Reuters will now pay Indians a fraction of what it was spending to employ Americans doing my old job.
That's the wave of the future, we are told. Skilled jobs are pulling up anchor and sailing off. Computer-programming jobs have already left by the thousands. Radiologists on other continents are reading our X-rays and CAT scans.
Intel CEO Craig Barnett says that approximately 300 million educated people in India, China and Russia can "do effectively any job that can be done in the United States." Bear in mind, there are only 144 million jobs in America.
I offer no easy plan for slowing the trend. But I'll darn well not celebrate it.
Last week, N. Gregory Mankiw, chairman of the president's Council of Economic Advisers, stated that outsourcing American jobs was good for the country in the long run. A chorus of economists and financial pundits sang hymns to his wisdom.
A noble exception was Barron's columnist Alan Abelson. He noted that Mankiw's comment nearly coincided with a University of Michigan survey showing a sharp drop in consumer sentiment. Consumers see a growing threat to their jobs and may be thinking twice about spending more money. And Mankiw's sunny view of outsourcing only confirms their suspicions that the federal government will do little to ease the pains of globalization.
Abelson then speculates on how outsourcing might apply to the Council of Economic Advisers itself. First off, the three dozen economists who work there earn far more than the $10 an hour paid to their Asian counterparts. Secondly, the Americans don't do a great job. The council had predicted a net gain of 1.7 million jobs for 2003, when, in fact, the United States lost jobs. And the council's estimate of 2.6 million new jobs this year is "ludicrously" optimistic. Why not send the council's research work to Bangalore? After all, Abelson writes, "our putative Indian economists couldn't have done — or possibly do — any worse."
And what would the out-of-work economists do? They could "simply follow their chief's advice and find new jobs ostensibly immune to outsourcing," Abelson says. "Peddling real estate, perhaps, or waiting on tables."
Let me add that some Wall Street firms have already sent financial-analysis work to India. It can be easily done.
Thanks, Alan Abelson, for lampooning those cheerful predictions of an outsourced world. The peppy defenses of outsourcing were getting me down. The worst ones contend that it will free us from the scourge of dull work. Janet Yellen, who headed the council in the Clinton administration, says that outsourcing may hurt "the more standardized part of high tech" work, but Americans will keep the high-end tech jobs.
Daniel Pink, author of an article on outsourcing in Wired magazine, echoes her optimism. Pink was recently on C-Span blowing a lot of Silicon bubble talk about American "dynamism," "big-picture thinking" and "high concept" employment. He noted that only "routine, relatively standardized white-collar work is going overseas."
Well, that would describe about 99 percent of all white-collar jobs. Not to worry. Pink thinks Americans will be left with the fun work. They'll be "software experts who can manage international 24-7 work teams." Yep. We'll all be sitting right there at the controls overseeing global armies of programmers. How Americans get to be the managers goes unexplained.
The problem is, there is no limit to the jobs that can go elsewhere. We can no longer pretend that laid-off factory workers need only take some computer classes and they'll be economically secure. Their skills, it turns out, are shared by about 300 million Indians, Chinese and Russians.
My job at Reuters was crummy in many ways — stressful, deskbound, often boring. But it taught me things. I had arrived knowing nothing about business and left knowing something. "Standardized" white-collar jobs represent more than paychecks. They offer training, as well.
If outsourcing is the future, so be it. But let's not play American workers for the fool. Their future doesn't look good at all.
When you all stop resorting to sophomoric libera; scare tactics tripe as argumemts, maybe the real debate can start
Why this Private corporation cannot be private?
But why is this good for the U.S. isn't this counterproductive? Comparitive advantage determines what gets traded. This is just the market, doing what it does best - allocating resources. Did you happen to catch the part where OPIC indirectly creates 1/4 million jobs and $60 billion in exports?
What if the federal government has to step in for a bailout? After blowing through 4 billion in reserves, it would be pretty safe to assume there would be some sizable political unrest underway - the kind of unrest that's like to bring some form of United States intervention, at the tax payer expense, anyway.
The "buggy whip" argument is pretty old, and not really applicable here. Horse & buggies no longer exist (except in Amish country). Software still exists, and there's a great need for good software developers. I suspect there will be that need for many many years.
That said, I think the free market is the place for the outsourcing/offshoring problem to be worked out. Some day there's got to be a company or two that figure it's best for their long-term bottom line and for the quality of their product to stay American. Security's better, the quality of the project management and code is better, that company would be seen as "patriotic" in a sense....
But for now, people prefer Chinese-made dorm room veneered pressboard to Amish furniture that can be handed down to you great grandchildren....
I hope this won't be construed as a personal attack.
THere's a difference?
I can tell. You seem to prefer fairly tales to truth and facts. So I will not brother you with either other then to say that the economic history of the nation and what you believe are very different.
Great, we'll mark you down as another Republican for Red China.
I don't understand. Are there no high tech jobs for Americans anymore? Is every single high tech job now earmarked for Indians?
I live in reality. Try it sometime.
Your reality is watching American Idol?
And your the economics expert right? Yeowza..
Great, we'll mark you down as another Republican for Red China.
Nope, not red China.
It's not? And what reality do you live in?
I'd want the chinese to get rid of the chicoms.
How's it feel to want? Why don't you send them a letter and complain.
It is that bad. I have a rather large network of people which include technical recruiters and even exectutives. The statements from all of them are pretty bleak.
From the recruiters I get statements that they are on the verge of leaving the industry because of the finacial hit they have taken. One of my friends who is a technical manager at a major supermarket chain has told me his company has stopped hiring Americans for their point of sale technical support staff. They are moving it all to India (that field is my specialty).
Another friend of mine is an exectutive for a mid sized fast food restaurant chain. He told me they are already overstocked with IT people and are in the process of cutting the numbers in half.
A family member of mine is the assistant director of IT for a phone company, and they are moving all IT operations to San Juan, PR.
Then, just searching job boards you can see the difference from even 6 months ago. In Microsoft development (like ASP, VB, etc), there used to be pages of jobs listed each day nationwide, and several in my city. Now it's a trickle, and a heavty portion of those are scams to get applicants to send them money.
People say that unemployment is 5 or 6 percent, but how many people are like me. I did not register with a state agency for unemployment benefits (welfare), and even if I had they would have run out months ago. I would have been considered employed. (I do not count temp office work at 1/3 of my normal salary to be employment, the government does).
These are just some examples. I also have 30 or so aquaintences working for various companies in my field and none of them are hiring. Most are in fear of being caught in the next downsize.
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