Posted on 02/14/2004 1:43:10 AM PST by sarcasm
WASHINGTON: The chairman of multinational Hewlett-Packard has deplored the current outcry against outsourcing to countries like India, China and Russia saying more jobs should be created in the sectors where the US has and will continue to have competitive advantage.
Carly Fiorina, the HP chairman, shocked critics of outsourcing recently by saying: “There is no job that is America’s god-given anymore,” and on Friday, in an article on the Wall Street Journal , she explained why she said that.
She recalled that 19 years ago, a group of leaders from American business, labour, government and academics – the President’s Commission on Industrial Competitveness – in a report had argued that America’s ability to compete in world markets was eroding in the face of emerging industries and “low-wage workers” in Japan and other Pacific Rim nations.
Rejecting arguments for protectionism, the Commission called on public and private sectors to invest in the worldwide economy by promoting research and development in new technology, improving education and training and lowering deficits to improve the cost of capital for business.
That strategy was pursued in the Eighties and the Nineties, creating more than 35 million new jobs and producing the longest period of economic expansion in American history, including a whole new IT sector, where jobs pay, on average, 75 per cent higher than other jobs, she said.
That commission’s message, says Fiorina, seems more relevant today.
"Once again" she says, "our leadership is being challenged – not by Japan, but by emerging nations like India, Russia and China. What makes this challenge different is that these nations not only share rich educational heritage, but they are investing heavily in innovation and R&D to help drive the next generation of growth.
"Not only do our competitors have increasingly knowledgeable work forces, but they can compete for jobs that were once the sole province of the developed world. There is much outcry... but not much constructive action.
"Now, more than ever, other nations are developing the skills to compete for jobs that would historically have been done by Americans... But we should work to keep America what it has always been: the world's most resourceful, productive and innovative country," she adds.
Agreeing that any job lost to foreign countries is particularly painful when the US economy is failing to produce net job gains, she said, "Yet spending our time building walls around America will do nothing to help us compete for the millions of new jobs being created.
"Instead, we must focus on developing next-generation industries and next-generation talent – in fields like biotechnology, nanotechnology and digital media distribution – that will create long-term growth and jobs here at home, while raising all of our living standards in the process."
That, she says, is why eight member companies of the IT industry's think tank, the Computer Systems Policy Project, have invested $80 billion in R&D, capital expenditure, education and employee training in the last three years.
Media supports Mankiw’s views
Meanwhile, a prominent US daily on Friday endorsed the views of key economic advisor to US President George W Bush, N Gregory Mankiw, that there is no difference between free trade in goods and free trade in services such as outsourcing of certain jobs to countries like India.
"Is there nothing to be welcomed about workers in poor countries getting decent jobs?" the Washington Post asked.
Chairman of President Bush's Council of Economic Advisors Prof Mankiw, said the Post , "was brave enough to speak the truth about the shift in service jobs to places such as India”. “The upshot? He's assailed from both sides of the aisle in Congress".
US President George W Bush, the daily noted, sought to limit the political fallout on Thursday, saying, "We need to act to make sure there are more jobs at home and people are more likely to retain a job."
Mankiw's offence "was to say that the normal rules of trade apply to services as well as manufacturing... it makes sense to buy call-centre services or software programming from India if they are the best on the market”, the paper said.
"Not only is Mr Mankiw right, but to argue otherwise is elitist and offensive. It would suggest it is okay for blue-collar workers to lose jobs to foreign competition but not okay for white-collar folk to face the same pressure."
People may feel, said the paper, that the new "offshoring" of service jobs is different because it appears unlimited. Until now, the loss of US manufacturing jobs attached to trade has been offset by gains in service jobs, which demand some proximity to the customer and have therefore not been tradable.
Now that fibre-optic cable links the United States to cheap, educated, English-speaking labour in India and elsewhere, old assumptions about what is tradable have to be rethought.
"The dislocation will create real pain to displaced workers, as Mr Mankiw acknowledged; programmes to retrain them should be expanded. But the US economy will not run out of jobs as a result of some service activities being tradable. After all, technology has been eliminating back-office administrative jobs for a decade, yet unemployment sank to record lows during the 1990s. Why believe that the next phase of US cost-cutting will produce a different outcome?"
LOL, now that's one way of looking at it I guess.
What Carly has yet to learn, and what America has yet to re-discover (but may very well soon) is that politics is simply violence in slow motion.
It is not whether a job is an American's "God given" right that is to consider, but rather when, through legislation, Americans place their collective foot on the throat of Carly's company and extract the jobs (or cold hard cash) on which they insist.
Keeping more cash at home will help, Mr. President.
So as the divine rights of the kings were overthrown in the name of the people, now the divine rights of the people will be overthrown in the name of the owners of the capital. Very wise indeed!
I guess it isnt Carly Fiorina's "God given right" to expect anything for HP either...tax breaks....or Americans purchasing HP products...
Weren't a lot of those IT jobs created by Y2K? We saw what happened to those jobs after 2000 arrived.
The best thing we could do to "keep jobs in America" would be:
1) Have meaningful tort reform. Make it possible for companies to take risks and be inventive.
2) Lower all EPA and other environmental regulations that suck more than $100 BILLION out of the U.S. business coffers each year. That would employ a hell of a lot of people.
3) Privatize health care and get it back in a "for pay" system so that businesses don't have to pay 35% MORE for each employee on top of the salary.
4) End all "social security contributions" and privatize Social Security so that an employee costs an American business less.
There are many other reforms that would dramatically reduce the cost on American businesses to employ people---and these are exactly the costs that do not exist in India or Mexico. Until we get rid of these government drags on hiring, there will be a continued "exporting" of job.
Speaking of Carly, does anyone know HER "G-d given right" Perks and Parachutes???
I'll listen to Steve Jobs [the $1.00 a year Apple CEO] before I'll take the word of the Mighty One who drove Lucent into the ground!!!
Oh, you can get data on faux "high wage" union-type jobs in France, but that's why they have an unemployment rate of 8-11%. So it's not a given that until Mexicans make $50,000 a year we will export jobs. It's never worked that way in our history. But there is a tipping point, where the returns to capital are sufficiently high to employ lower skilled, less-talented or less educated people because the costs of hiring Americans are simply too high.
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