Outsource the work of our economic advisers

seattle times ^ | February 19, 2004 | Froma Harrop

[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.

[Luis Gonzalez]

"The flip side of freedom is others are free to take action against your freedom."

I own a multi-State corporation, and you're advocating taking action against my freedom.

"The only think I want to have happen is for public opinion to be turned against the people who outsource jobs to other companies."

No, the true way would be to get the public to stop buying the cheaper product supplied by outsourcing. But you can't do that, so you want the Federal government to do it for you...and you call that "conservatism".

Don't piss on my leg and tell me it's raining.

[edeal]

For you Luis, I would support almost anything. What corporation do you own so all of us here can avoid it.

English is probably not your first language so I will not mention again that you once again put words into my mouth, because otherwise that would demonstrate that you are just a troll who is just trying to cuase trouble in the forum.

So obviously you are having trouble with the language. In any event I am proud of you that you are able to communicate this well. Many immigrants do not take the time to learn any English, and you have worked very hard at it. However, I would recommend you look up the following word.

hypocrisy - The practice of professing beliefs, feelings, or virtues that one does not hold or possess; falseness. see: Luis and his "free trade" stance that it is ok to embargo Cuba because he supports getting back at Castro and also supports embargoing China except for American companies that want to outsource engineering there.

Here, is it used in a sentence so you can get some context which often aids in understanding. "Luis, it is blatant hypocrisy that you support trade restrictions when it satisifies your personal hatred for others, but oppose it when it helps people that you have utter contempt for, like most American workers."

Welcome to America. I hope your days here are filled with happiness, even though the tone of all of your posts demonstrate you are not.

[edeal]

Did Bush downsize your job?

In a manor he did in his support of the H1-B worker program. The year me an a good protion of our office was closed, the management (all from England), hired another office full of people. Nothing too strange about that, except every single one of them were English or Chinese.

After they got up to speed, strangely layoffs starting happening. 3 here, 3 there, 2 here. Wow, 8 people hired, 8 people fired, only none of the English and Chinese nationals were fired.

Out of a company of 28 people in the USA, currently 15 of them are not US citizens. Wierd that.

Another interesting thing was that the 8 who were let go, were 8 of the top 10 salaried people, none were managers (well I was a partial one, but none of the "big 4").

I do not understand the reason to have a program to bring foreign nationals who are forbidden from becoming American citizens into this country to fill high skill and professional jobs when the country is in a recession.

In any event, I am actually proud of you Luis, you are actually making points this tiem instead of insulting people with poorly written one line quips with no bearing on reality.

[ninenot]

Sorry--like most of America, I use a wired mouse, wired keyboard, and dialup.

There are costs, ridiculous costs, and completely WASTED costs.

[Luis Gonzalez]

I've been making points all along, you can shove your condescending attitude, and begin using the spell checker.

[ninenot]

The concerns expressed by a number of people on these threads are not "cry/whine" concerns.

I am sure you understand that the gross statistics are precisely that: gross. They tend to have all sorts of interesting little underlying statistics which are germane to particular SIC code sectors or geographic areas.

For example, the State of Wisconsin's Legislative Fiscal bureau released a letter stating that Wisconsin would likely see a shortfall of $32MM at its budget year-end in mid-2005.

Sales tax revenue is approximately on track as forecast--and corporate income tax revenue is actually higher than forecast. So what's the deal?

WAAAAAY down in the fine print, you learn that Personal Income Tax revenue will be $221 MILLION (yup, two hundred twenty-one million) short in the biennium.

That means that not only are a lot of people unemployed--but that those people USED to pay a fair amount of income taxes.

Now it so happens that Wisconsin's unemployment rate is only around 6.0%--higher than the national average, but not significantly so. We've had as little as 3.5% unemp, and up to 8%, (back in the days of Carter.)

What's significant about that combination of numbers is this: the people who are unemployed NOW are people who typically paid a large chunk of taxes. These are not the $14-$18K/year clerks in a grocery store; these are the $30K-$100K blue- and white-collar people with 20 years' experience doing whatever...

THAT'S why the numbers are significant. And if you've had 20 plus-years of experience and are a MALE, God help you--no one else will.

[Luis Gonzalez]

hypocrisy - The practice of putting words in other people's mouths while complaining that people are putting words in your mouth.

I can pinpoint every time you've complained that you're owed a job, it's the reason why you "dropped" your support for Bush...because you can't get a job, but I bet that you can't show me where I've said that I want to "get back at Castro", nor where I have supported outsourcing jobs to China.

My actual statement was that free trade can only be between free peoples. But, being the socialist that you are, you don't see the Chinese or Cubans as lacking freedom.

I oppose trade with Cuba because, and I will repeat myself, free trade can only happen between free peoples.

[endthematrix]

I saw that too. Right off the bat he tried for Lou's throat and in the end it was his tail between his legs. Ha! Lou Dobbs Tonight

[ninenot]

Are you trying to convince the people in this forum that the U.S. in 1776 could have imported goods from Europe at a cheaper price than goods produced in the "colonies"?

You are perhaps the ONLY individual on these boards who could mis-read a post that thoroughly, adding to the impression that you're a troll or a paid staffer of the RNC.

The United States established tariffs: 1) to finance the Federal Government; and 2) to provide an accomodating stance for the establishment and growth of the US economy.

Nothing else.

[edeal]

Since you took the time to actually write a non troll post, I wanted to get back to my reply on this one since the explanation to your first reply was so long.

Corporations are not the principles behind the free market. The corporation is a construct that is one of the ways to facilitate it. I suppose I will temper what I said, as I have had more time to think on the subject since we have been discussing it and of course since you have been trolling it.

My issue is not with the corporation, it is with the large mega cap corporations, that live off of government favor at the expense of true free market types. (Basically your heros).

Believe it or not SOME government is good. Laws against murder interfer with "freedom". So do laws against owning large scale nuclear devices. I support such laws, of course you probably don't if they protect people on your ever growing enemies list.

Other parts of these laws are the right for the government to create an army to defend us against outside invaders. I also support SOME regulatory oversight as long as it has grounds in the Constitution.

In truth I wish we lived in a society that where we can all be naked anarchist, where there was no need for government and everyone respected the rights of others. You know what? People who have no respect for their fellow man and therefore will use any angle to defraud others make this impossible. (People who post trolls to newsgroups and call people they don't know communists, lazy or stupid might be a good example of someone with this character flaw).

Also many people are just incompetent. Probably 40 percent of the country at some level. We can have these people suffer like the lazy communists they are, as you propose. Or, we can prevent society from falling apart and sacrifice some freedom. It is a question of purity or survival of the entity that protects our rights.

You know all governments are a social contract which require that we give up some freedom in exchange for order and the ability to avoid the law of the jungle.

As long as an individual is not interferring with the basic rights of another, i.e. murder and mayhem and other notorious acts, they should be left alone. In a private single owner business or partnership, this is a perfect relationship.

A corporation is different. A corporation gets special status to act an "unnatural" person. A corporation is basically a social commune for a common economic purpose. In that situation the corporation is more or less a seperate entity from the individual and has special rights. (I.e. Government largess).

The owners of a corporation are not held liable beyond the investment they put into the corporation. Wow, what a sweet deal. You mean I can do all kinds of ilegal and unethical things under the cloak of a corporation and not be personally responsible? You bet yuh. Are there some limits to that? Yeah, but civily there are almost no limits.

This is a special status that is not given to owners of small business or even large business run as a single owner or partnership. This is a form of welfare. I therefore have little problem with modest regulation of the corporate environment. if you want to live off welfare, it is only fare.

I am for personal responsibility, not communal responsibility. You want full laissez-faire free market rights, but your good name behind your company. You want to hide behind the protect that the corporation gives you and receive special treatment under law, accept some regulation.

[edeal]

I think Luis is probably an importer (he said he owns a multi-state corporation and keeps harping on importing cheap goods from other countries, just not Cuba cause he has an axe to grind with them) and is looking out for himself and not really reacting to strongly held beliefs. If he was an engineer or programmer, he would be on the other side.

[Luis Gonzalez]

"The United States established tariffs: 1) to finance the Federal Government; and 2) to provide an accomodating stance for the establishment and growth of the US economy."

tar·iff
(click to hear the word) (trf)
n.

1. 1. A list or system of duties imposed by a government on imported or exported goods.
   2. A duty or duties so imposed.

"No nation has ever gotten rich by forcing its citizens to pay more for domestic goods and services that could have been procured more cheaply abroad." -- Bruce Bartlett

Incorrect, USA 1776-193x -- You.

Now, go ahead and give us your version of American history...you know, the one where the Founders FORCED US citizens to pay more for DOMESTIC GOODS (you know...the ones they did NOT impose tariffs on).

I'm no troll...you just can't read.

[Luis Gonzalez]

"just not Cuba cause he has an axe to grind with them"

You're a liar.

"...and is looking out for himself and not really reacting to strongly held beliefs."

Only YOU have strongly held beliefs...right?

Go back and finish the bottle.

[HiTech RedNeck]

I'm a troll, foldy rol,
I'm a troll, foldy rol,
I'm a troll, foldy rol,
And I'll send your job to China.

[Texasforever]

Jerk.

Poor Laz.

[edeal]

In case you haven't figured it out, I was having liberties at your expense because of the strongly negative attitude that you show people on this board (when they even a slightly different belief). Early on, you interjected yourself as an insulting troll and showed little respect for other posters. Respect is something that must be earned.

I too believe that free trade can only be between free people. However you state that outsourcing is OK. The only countries this is really happening are backwater unfree countries like China and India.

India has a system not unlike South African apartied that is still practice today. If you are not from one of the acceptable classes you are more likely living in a dirt hut on the river than going to the USA to be educated at government expense.

Why can India afford to educate some and not others? Lets get some quotes about India from the CIA factbook.

"Overpopulation severely handicaps the economy and about a quarter of the population is too poor to be able to afford an adequate diet."

"Government controls have been reduced on imports and foreign investment, and privatization of domestic output has proceeded slowly."

"India has large numbers of well-educated people skilled in the English language; India is a major exporter of software services and software workers; the information technology sector leads the strong growth pattern."

"Deep-rooted problems remain, notably conflicts among political and cultural groups. "

"Labor force - by occupation:
agriculture 60%, services 23%, industry 17% (1999) "

"Exports - partners:
US 22.5%, UK 5.1%, UAE 5.1%, Hong Kong 4.5%, Germany 4.3%, China 4.1% (2002) "

"Imports - partners:
US 7.1%, Belgium 6.7%, China 4.6%, Singapore 4.6%, UK 4.6% (2002) "

"Illicit drugs:
world's largest producer of licit opium for the pharmaceutical trade, but an undetermined quantity of opium is diverted to illicit international drug markets; transit point for illicit narcotics produced in neighboring countries; illicit producer of methaqualone; vulnerable to narcotics money laundering through the hawala system "

And how about an interesting one from China

"Exports - partners:
US 21.5%, Hong Kong 18%, Japan 14.9%, South Korea 4.8% (2002) "

"Imports - partners:
Japan 18.1%, Taiwan 10.5%, South Korea 9.7%, US 9.2%, Germany 5.6% (2002) "


India has the ability to do things so cheaply because they have an large number of "serfs" to do the work for the elite, who can live like kings on a fraction of the salary we can here. Also notice that one of the issues from the source book is that India is a protectionist country that defends its markets against free trade. WHAT ??!!! Impossible! They are free marketeers of the highest calibre, certified by Luis, how can this possibly be?

We are getting it up the behind by our politicians and these Nations. They don't practice free trade, yet we are suppose to give them every advantage in the world. Brilliant.

[Texasforever]

Can you say anything in 100 words or less?

[edeal]

Good job there, I think you missed the American Idol auditions by a month or two though.

[HiTech RedNeck]

Spamnation!

[HiTech RedNeck]

I.e., spamn you.