The Reality of Outsourcing

Townhall.com ^ | Bruce Bartlett

[supercat]

Can you explain the consequence of priority inversion in a real time operating system?

A low-priority task holds a resource needed by a high-priority task, and so the high-priority task can't execute until all intermediate-priority tasks have been serviced.

How about a quick exposition on the merits of FSK, PSK or QAM?

The latter allow more data to be exchanged in a given bandwidth, but are more complex and more sensitive to frequency-dependent timing distortions.

Would you choose CSMA/CD or token passing for best deterministic response?

Token passing.

How did Shannon improve upon Nyquist's sampling theory?

Did he clarify the exact way in which frequencies above f/2 fold back, or had Nyquist already done that?

[navyblue]

This should be an obvious question but I have not seen anyone ask this yet.

When they outsource all the jobs they can and bring in guest workers for all the jobs they cannot, who the hell is going to be paying the taxes to support this government?

I asked this question of a political science professor today and his answer was that nobody has the answer to that.

That being the case, what the hell are they doing this for if they don't know the consequences of their actions?

[Myrddin]

I see someone reading the thread has done more than figure out how to "work a PC". The element I was seeking on Shannon's behalf was the impact of signal to noise ratio on the carrying capacity of a channel.

[LibertyAndJusticeForAll]

It is mostly because of the Internet and the fact that IT people know how to use it that they are getting attention disproportionate to their numbers.

Bruce Bartlett on the unfair advantage that unemployed IT types have over other unemployed Americans. The nerve. ;)

[WilliamofCarmichael]

RE: "Writers on this topic keep spewing this comment. They fail to observe that the outsourced jobs are in the new industries. None of them has managed to point to what "new" industries are prepared to employ the 4,000 to 6,000 people who get dumped on the street each day. They were not making buggy whips. They were employed at the forefront of technology. Most have 4 year degrees and many years of experience."

That's an excellent point.

Many losing their jobs, I might add, are refugees from factory offshoring who retrained for the promise of better jobs. Now combine the quote from above with a post from another thread. To wit,

"The offshoring model in fact is the opposite of free trade. It is not trade at all but labor arbitrage. Unlike real arbitrage, the act of exploiting the wage differences is not ending the arbitrage opportunity. US companies create captive offshore centers in which the local employees are used to fulfill demand in the US while their wages are kept isolated from that same world demand."

See also the writings of Stephen Roach.

This ain't your great-grandfather's Ricardo. This is about a glut of readily available cheap labor worldwide and IMO is more akin to 19th century capitalism instead of comparative advantages among free trading countries. Fine.

There's also the those pesky "capitalists" depending upon tax supported Ex-IM Bank, OPIC, special programs, etc. Not so fine, IMO. But it's a riot hearing free traders complain about government "interfering" with capitalism when their pocketbooks are threatened. "Capitalism" has come to mean always having government money there if and when a capitalist needs it? Hands off! everybody else?

RE: "Few of the rockets that put the satellites into orbit were privately financed by the companies that now exploit them."

That's another taxpayer service, all the risks and R&D that built the rockets and facilities. BTW, I thought most of what makes cross-border IT-enabled services possible was the cheap underseas bandwidth.

[calawah98]

I just heard on the local news, out of Seattle, that if you have your income tax prepared by an accountant, ask the accountant if they send your income tax return to a company over seas, such as India to be prepared? India was the only country mentioned, but that does not mean they are sent to an other country, another plus for out sourcing. Your identity could be stolen, is what the news reporter said.
This seams to be the normal way any more for your taxes to be done.

[Myrddin]

BTW, I thought most of what makes cross-border IT-enabled services possible was the cheap underseas bandwidth.

Yes. The undersea cables were placed before we figured out the world of satellites. Network routing rules prohibit a voice path from traversing both forward and reverse paths via satellite because of the huge delay introduced.

I'm a former Bell System employee and very familiar with the helps and hindrances that government introduced into the telecom industry from the earliest days. Anyone who doubts the ability of government to lay taxes and tariffs on telecom need look no further than the monthly bill. I get my wireless activity in excruciating detail...along with some general taxes. The excruciating detail that you see in the billing records is evidence of the fine granularity of modern billing systems. It would be simple to impose targeted tariffs. Custom programming of the operational support systems was my specialty before I left PacBell.

[phil_will1]

"it seems to me that income tax rates in this country play a major role in the outsourcing of services and production."

My sense is that our tax system is a major problem with respect to the flow of goods and is therefore significant in our lack of competitiveness internationally in the manufacturing and agricultural areas. Although that system also tends to inflate the cost of labor here, and may therefore also contribute to the outsourcing trend, I would think it isn't as significant a factor there. The biggest factor, it would seem, is that there are huge pools of educated workers who will gladly work for a fraction of what their US counterparts would require.

[phil_will1]

"A politician in New Jersey is trying to pass a law that all companies that outsource IT jobs cannot get State contracts."

I read somewhere that something like a dozen states are trying that. The problem, however, is that only about 2% of the outsourcing that is going on is governmental.

[Lazamataz]

How'z it feel... geeks?

Pretty good, now that I just trashed your credit rating. ;^)

[Per-Ling]

Ahhhh... the "company computer guy."

[The Red Zone]

Last week, Council of Economic Advisers Chairman N. Gregory Mankiw ran into a buzz saw.

Probably made in China too.

[phil_will1]

"When they outsource all the jobs they can and bring in guest workers for all the jobs they cannot, who the hell is going to be paying the taxes to support this government?"

You are right, that is the big question - or one of them.

Lou Dobbs of CNN, as many of you know, has been all over this story. He had Carla Hills on the other night; I believe that she is a former labor secretary. She cited some study that said that 20 MM new jobs would be created in the US over the next decade. My question to her would be what kind of jobs? We all know that not all jobs are created equal.

I would hope this becomes THE issue of this campaign. We should be asking tough questions of every single candidate for elective office - either party. I personally don't think protectionism works in the long run - as evidenced by the President's recent steel tariffs. They solved one problem and created others. However, I am sincerely concerned about how the US will be able to maintain a standard of living for the next generation that is at least comparable to what we have known. I certainly don't have all the answers and it sure doesn't look like our elected leaders do either.

BTW, I know that Fundamental Tax Reform (FTR) is a big part of the solution with respect to the flow of goods, but thats another post, if not another thread.

[RushLake]

I don't think you're wrong at all. We have a canadian democrat governor in Michigan who can't get it thru her thick head that the way to economic prosperity is not to tax, regulate, and litigate the hell out of manufacturing and business.

I think it goes further. I just retired from the domestic auto industry. Even in spite of Jacque Nasser's divide and conquer diversity initiatives, we could not find enough talented American engineers when we hired. We had to turn to engineers who came here from India and the Middleeast. Meanwhile in the USA, we have high schools that produce kids ready to become environmentalists, diversity consultants, and democratic party campaign operatives. Additionally, just from the domestic auto industry perspective, we could not, and they still cannot get those "quality" union people who are hired to come to work full time, and who receive expensive full time health care benefits to come to work everyday prepared to work. The benefits still get paid at the full time rate, and part time or sick/lame/lazy employees get put on the job in the absence of the qualified qualilty union employee. Companies owe an obligation to stock holders, and they will look for a way to make good on those obligations.

[phil_will1]

"Anyone who doubts the ability of government to lay taxes and tariffs on telecom need look no further than the monthly bill....It would be simple to impose targeted tariffs."

As I said in my post above, I'm no protectionist, but I must say that this idea has some appeal to me. I think that we should demand that our elected representatives study it. My biggest questions are
(1) How high would the tariff have to be to offset the huge labor cost differential? My sense is that it would have to be enormous - much larger than the base it is being levied on. Is that really practical?
(2) What are the unintended consequences? They are always there when you start taking protectionist measures. It may be that the unintended consequences are justifiable, but I would rather know what they are, rather than getting blindsided.

I have to say that this is the first time I have heard a proposal about actually doing something about the outsourcing trend. It may be that we could set a rate that would not be so high as to completely reverse the trend, but would change the equation enough to slow the hemorraging and bring in much needed revenue.

[FreedomPoster]

>>BTW, I thought most of what makes cross-border IT-enabled services possible was the cheap underseas bandwidth.

Exactly correct. Undersea cables are where the big bandwidth happens.

A great (and very lengthy) Wired magazine article on the history of undersea cables is here:
http://www.wired.com/wired/archive/4.12/ffglass.html?pg=1

[FreedomPoster]

I can assure you it is far from normal. Most taxes are still done in the U.S., though some offshoring of tax preparation is occurring.

Identity theft due to confidential personal financial information being available to offshore employees is a real issue. I expect we'll see some big stories on this in 2004.

[phil_will1]

"Most taxes are still done in the U.S., though some offshoring of tax preparation is occurring."

I seem to recall that one of the Big 5 was doing some of that a year or so ago. It also seems to me that they decided to terminate the practice when they received some bad publicity about it.

As an aside, our tax system is so complicated that even Americans who have grown up with it don't understand it - even if they are CPAs or work for the IRS. OTH, if you are going to have your taxes done by someone who doesn't understand the system, what difference does it make if they are foreign?

[FreedomPoster]

FYI, we're down to the Final Four, with the demise of Andersen. It's hard to keep up.

[phil_will1]

"FYI, we're down to the Final Four, with the demise of Andersen. It's hard to keep up."

Yes, it is. I worked for Price Waterhouse when it was still the Big 8. God, I feel old! LOL