What Should a Documentary Filmmaker Ask About Offshoring? 1091
Philadelphia-area development economics and finance student Rachel Anderika and her associate, programmer/filmmaker Krishnan, are making a documentary about the effects of offshore outsourcing. Their "still under construction" Web site, Project Outsourced, gives you more information about their work. They're interviewing economists, bankers, anti-outsourcing advocacy groups, pro-outsourcing CEOs, columnists, and others. Where you come in is helping Rachel and Krishnan come up with good questions to ask. We'll forward 10 - 15 of the highest-moderated ones posted here (within the next 24 hours) to them. Expect summaries (and possibly audio or video clips) of the answers in late May, and news about the finished film this Fall.
Outsourcing on Slashdot: Fair and Balanced? (Score:5, Informative)
V
Valence Technology
VA Software
Veritas
Verizon
Here [cnn.com] is a list of companies that use outsourcing.
Re:Outsourcing on Slashdot: Fair and Balanced? (Score:5, Funny)
Re:Outsourcing on Slashdot: Fair and Balanced? (Score:5, Insightful)
Which is why we should tariff the import of intellectual property. Businesses want their intellectual property protected just as if it were actual physical property (DMCA, copyright law, patent law, etc), but they import intellectual property in the form of code, legal advice, chemical formulas, genetics research, etc, into the country without paying any value-based tariff.
Either it's property or it isn't. If it is, keep your copyright and patent laws, and pay up when you bring this property into the United States just as you would if you brought a truck load of goods. If it isn't, then say goodbye to its legal protection, and finally say hello to inexpensive AIDS medication, "legal" pirate operations for CD and DVD sales, etc.
Re:Outsourcing on Slashdot: Fair and Balanced? (Score:5, Insightful)
Bingo! It's a double standard. IP is now an imported product just like everything else we consume. We as a nation (and I understand that not all Slashdot readers are from the USA) need to look out for and support our "middle class". If this means making it cost more to "outsource" and thus keep more jobs here, it's something we need to do.
Re:Outsourcing on Slashdot: Fair and Balanced? (Score:4, Interesting)
Anyway that really wasn't your point here. If people can't patent things (like AIDS medication) they will not invent it because they will never recoup their R&D costs if it is to be just given away or "legally pirated". Music and drugs are entirely different...
Any two bit idiot can't play music and the cost of creating and producing it is nowhere near to the costs of researing and producing a drug. For every drug that comes to market there are about 10 that do not. The drug companies have to make back their money somehow. Now, that said, sure they may be gouging us in some respects, but still things can not, will not and should not be free. History has proved this economic model fallacious.
-Craig.
Re:Outsourcing on Slashdot: Fair and Balanced? (Score:4, Insightful)
Funny you should phrase it that way... the current music and pharm industries aren't that different after all. For every album that turns a profit, there are dozens that lose big. The record companies make their money on a very small percentatge of their catalog, which get big enough (due to marketing dollars, in large part) to offset the losses they're dealt by the vast majority of their contracts.
The scale is different, but the model is very, very similar.
Incidentally, the reason they're similar is that 50+ years ago, those two bit idiots couldn't get a hold of good equipment and the cost of production was many orders of magnitude out of normal people's reach, similar to pharma now. The music industry has held tight to their model, past it's sensible end point, because computers and cheap electronics have made production costs negligible... well within the reach of average people.
I'm not guaranteeing that in 50 years, we'll all have gene sequencers and personally matched pharma, but, technology has a way of obsolescing business models. At some point, laws need to change to reflect new environments.
People do need to be incentivized to produce... that's a good reason for IP law. But there need to be limits to how much control they have, and for how long, in order for greater society to benefit. The commons always need to be addressed. If the laws benefit the few, to the detriment of the many, then they are unjust, and should be modified.
Re:Outsourcing on Slashdot: Fair and Balanced? (Score:4, Insightful)
If as a customer, I expect companies to try to screw me over, I take full responsibility if a company successfully screws me over, and I don't usually let it happen again.
It's the same thing with my environment, if a company messes up my surrounding envrionment, I take full responsibility for chosing the location I live in and I take full responsibility for moving away and/or making them stop.
Yes, that's the principle. It doesn't scale though. No one has time to investigate all the companies they do business with to the extent required for pure capitalism to work.
Let's see, I've done very little today from a consumption standpoint, what would my list be:
I had two slices of toast and some peanut butter for breakfast.
I took an ibuprofen for my knee.
I took some vitamins for my other parts.
I had a very simple lunch (roasted chicken).
I bought a drip waterer for my garden.
I played ultimate at lunch.
I had a handful of peanuts from the snack cube.
I drank some bottled water.
It seems unlikely that even I, someone who cares, would be able to investigate that many purchases, but it's actually worse than it first appears. Just take my breakfast.
That two slices of toast breaks down to:
A bread company.
The suppliers to the bread company (we'll assume they are all producers and not middlemen for the sake of the simplicity of this example).
the company which supplied the wheat
the company which supplied the butter
the company which supplied the eggs
the company which supplied the yeast
the company which supplied the water
the company which supplied the machinery (ovens, mixers...)
The peanut butter company.
The supplier to the peanut butter company.
The supermarket.
The common lore is that market economies are supposed to be efficient. What is more effecient about every single person doing that kind of leg work than having a legal system which says you must pay a minimum of $n/hr, you must adhere to osha rules, you must not dump your junk in the public's rivers?
Pure capitalism is every bit a nightmare that pure socialism is. I care and I don't think I could keep up with the research necessary to live in that world. What about the 95% that don't care? Consumer Reports, for example, is a fairly reliable organization, but how many people bother to check what they have to say before making a major purchase that effects them directly? Why should we believe that these same people who don't do the homework necessary to protect *themselves* would suddenly, in a pure capitalistic system, do the homework necessary to protect themselves, the workers they do business with and the environment?
We shouldn't.
We built things like osha, epa, fda and others because the business community showed themselves willing to maim, pollute, sell snake oil and a myriad of other reprehensable things if left to their own devices.
We shouldn't go back to that. We tried it, it didn't work.
Ya know, I thought something was strange... (Score:5, Funny)
Re:Outsourcing on Slashdot: Fair and Balanced? (Score:5, Insightful)
Now, if VA is *currently* sending work overseas, I'd be interested in hearing about it from the horse's mouth... horse?
Re:Outsourcing on Slashdot: Fair and Balanced? (Score:5, Insightful)
So if VA were to start off assembling computers themselves, decide they can't compete financially with companies that are buying assembled computers from Taiwan, so they close their assembly line and buy from Taiwan, then that's bad.
However, if they never employed anyone to assemble computers in the U.S. at all, then that's OK?
How about this: they keep assembling computers in the U.S., and go out of business because everyone is buying from vendors who "outsourced" to Taiwan?
Re:Outsourcing on Slashdot: Fair and Balanced? (Score:4, Interesting)
When toxic computer components are exported and dumped in third world countries, do you protest "American computers" being sent abroad? Firecrackers are produced by 4-10 year old kids in India under horrible conditions. Do you protest the offshoring of the manufacturing of these "American firecrackers"?
Yet when it comes to IT (and previously electronics), these jobs are "American". The comfy, well paying ones. Your God given right.
Free markets work both ways. Regardless of whether the global market is really free, whatever America gets, you're only getting what you asked for.
Re:Outsourcing on Slashdot: Fair and Balanced? (Score:5, Insightful)
The real issue is gross domestic salary. Is the buying power of American consumers at large at least remaining steady or is it in rapid decline?
What is the social impact of retraining highly experienced specialists that may have spent 10 or 20 years developing their skills? What is the economic impact when those people suddenly can't continue the level of consumption they had previously?
What do we do when the tradesmen and laborers that those professionals allowed to be employed are also on the unemployment line?
Practice of outsourcing (not a question) (Score:5, Funny)
Re:Practice of outsourcing (not a question) (Score:5, Informative)
It seems that this outsourcing thing can and does work both ways, no?
(err, cue massive down-modding by disgruntled outsourced IT workers...)
Re:Practice of outsourcing (not a question) (Score:3, Informative)
For the japanese it is much less expensive to produce a car here. They use very strict processes that have cause for little waste, high quality (so they don't have nearly as many bad parts made and don't have to do the same amount of testing) and they don't use unions.
Re:Practice of outsourcing (not a question) (Score:5, Insightful)
The problem, the way I see it, is that there's a difference between first-world countries (Europe, Japan, US) trading with each other, and us trading with third-world countries.
If we buy Japanese or European products, we can feel safe that we're buying from companies that compete on a level playing field with our own: the cost of living is roughly comparable, and environmental and labor laws are fairly similar. Companies in Japan or Europe aren't able to lower their prices by simply hiring sweatshop workers or dumping toxins in the nearest river; they have to do things properly and keep themselves efficient.
But when stuff gets outsourced to third-world countries, these protections are absent, which allows companies there to keep their costs extremely low. How can an American manufacturer compete against one that can pay their workers pennies a day, and dump their waste wherever they please?
Productivity (Score:5, Insightful)
The way American companies compete against foreign companies is the same way we have for centuries - innovation and productivity. Even though Ford could build a car plant in Mongolia and pay 1% of UAW wages, they'd lose their shirt. Shipping costs to consumers and from suppliers, lack of a trained labor force, etcetera would cost them much more than they'd save.
Now, making plastic toys? Yeah, that's in China now, for the reasons you cite. But how is that a bad thing? Have you SEEN the toys you can buy for $20 now? Unbelievable! What do you think it'd cost to build, say, a Hoberman Sphere with US labor? How many fewer would get sold at that price. Not a lot of US jobs saved, but Hoberman is a lot poorer. And he lives in the USA.
As for environmental protections, we certainly need better global environmental controls. But trade isn't the problem or the solution there. Even if we had complete trade barriers, greenhouse gasses don't know borders.
Re:Productivity (Score:4, Insightful)
Well, probably not.
People who can't do highly skilled jobs will do unskilled jobs. Pump gas, work on a farm, sort recycling. Or train them. Life as an unskilled laborer in a 21st century first world nation isn't great, but it's a lot better than as an unskilled laborer in the 3rd world.
Now, as a society, we need to be working hard at reducing the number of people we have who can't do skilled jobs. And that's working to some degree - how many US Citizens are doing migrant farm labor these days? Probably our biggest failure as a nation is not fully funding schools and enrichment programs in poor areas. Even if conservatives want to blame the poor for being poor, it certainly isn't their kids fault.
But anyway, unskilled labor has been around forever, and most of the jobs they did a long time ago have gone away, and new jobs always show up. Most unskilled workers were farm labor a century ago.
Re:Practice of outsourcing (not a question) (Score:5, Interesting)
There is a difference between having a factory in an other country to serve that country and exporting most/all of that factories output to the USA.
Hell, it can't continue much longer due to how our income tax system is setup. If you make less than a certin amount you pay NO income tax, and most of the new 'service' jobs pay less than that amount.
Re:Practice of outsourcing (not a question) (Score:5, Informative)
Re:Practice of outsourcing (not a question) (Score:3, Informative)
Re:Practice of outsourcing (not a question) (Score:5, Insightful)
But look at somewhere like El Salvador. If you ship a car plant there, we get cheaper prices on labor. But we don't get the subsequent increase in revenues because El Salvador doesn't represent a good market for American cars. So the net effect is to push down wages at home and ship our investment capital overseas. The benefit that gets touted is usually prices, but the truth is that most goods maintain price levels because they were within the public's buying envelope anyways. It's only the high end luxury goods that get their prices lowered.
This is why bilateral, negotiated trade is the way to go. It doesn't make sense to have the same trade policy with every country.
Lower prices! (Score:5, Insightful)
Yes, moving a car factory to El Salvador will cost some US jobs in the short term. But no, there will be a price drop (or a price/performance improvement) in cars available in the USA. There is the idea floating around that outsourcing means that companies just keep the profits, and that money just vanishes from the economies somehow. However, in a competitive market like cars, some company is always willing to trade lower profits for increased market share. This can take the form of selling the same car for less, or more car for the same price. But this puts pressure on everyone else to lower prices.
For example, compare how much car you can get for 1/4th of the median family income today compared to a few decades ago. A 2004 Civic is a vastly better car than anything one could buy in 1972.
And look at how much better US made cars got in the decade after the Japanese import boom started. While it might have been painful for the workers in Detroit, for the vastly greater number of US car drivers, imports and outsourcing have been a HUGE gain.
The thing about free trade is that the pain is concentrated, but the benefits are diffuse. But the aggregate benefits always (and yes, I mean ALWAYS - I don't know of a single counterexample in the last few thousand years) outweigh the aggregate losses.
The wage differential between the USA and India is a reflection of our greater wealth and productivity, not a threat to our wealth and productivity.
Re:Lower prices! (Score:4, Insightful)
But there will (Score:4, Insightful)
Let's say Volvo sells 100.000 cars a year for $30k that they spend $25k to manufacture. That brings in $500M. They could lower the price to 29k and sell 120.000 cars and make $480M, or they could raise the price to $31k, sell 80.000 cars and make $480M. Clearly they picked the selling price $30k to maximize their profit.
Now let's say they figure out a way to make the cars for $23k. Selling 100.000 cars will now bring in $700M. But selling 120.000 cars for $29k will make $720M. So they lower the price. It's really quite simple if you look at it the right way.
The common misunderstanding here is that people think Volvo won't pass on their savings since they're greedy bastards. In actual fact, they will pass on their savings because they are greedy bastards, and will make more profit doing so!
No, there won't be a price drop. Prices are established by the market, not arbitrarily set by the manufacturer. A Ford Focus will cost as much as people are willing to pay for it, given demand and supply. Moving the plant to El Salvador changes neither supply nor demand. You aren't opening a new consumer base, and you aren't getting yourself a way to fulfill previously unfilled demand. It only lowers the price of making the good, thus increasing the profit margin.
Put in those terms, prices for a single manufacturers goods are arbitrarily set by it. How much it will sell at that price is determined by the market. That is how lowering costs does increase supply at a certain price.
Real Question (Score:5, Interesting)
Q1: If the severe oppression underlying working conditions for the vast majority of Indians was removed, would outsourcing of "high-end" jobs to India cease to be profitable?
Q2: How does the current practice of outsourcing of "high-end" jobs to India help Indians in the ongoing struggle to remove the severe oppression there?
Examples of oppression and their supporting infrastructure:
1) Forced and *uncompensated* displacement of people from rural areas into the cities because of emminent domain siezure by authorities. (Official Indian government figures put the number of people affected by this at around 40Million since 1947. Activists estimate the number is much much higher.)
2) Ubiquitious child labor in the houshold cleaning, and other related service sectors. No real enforcement against it.
3) Child slavery and bonded labor (think "indentured servitude" from your history classes, but much worse.) affecting millions in rural areas. Sporadic enforcement against it.
4) Open physical and verbal brutality of authorities (police, guards, and even employers) towards the poor to keep them obedient and compliant. Personal Note: once on a trip to India, I saw a policeman beat a little beggar kid about 3 hours after my plane touched down. I see examples of stuff like this on every trip to India. I have even heard many well-to-do folks talk openly about how "this is all those kind of people can understand."
5) Right to education for everyone exists on paper only. Many areas have no functioning public school or that school has been "captured" by a subsection of the community with others excluded by overt and implicit discrimination.
6) No democracy within political parties. The voter has no say as to whom will run for a seat on behalf of any given party. (e.g. No caucuses or primaries of any kind.) Rules *preventing* elected members of parliament from voting their conscience on issues affecting their locality.
7) No freedom of information act or sunshine laws. (Even Ashcroft has to obey at least some FOI requests.) Example of a resulting state secret: How much money was spent on the goverment support of parochial (Christian and Muslim) schools as compared to the money spent on public schools open to all?
8) No right to a speedy trial by a jury of peers. Say what you will about the OJ case, etc., participation in jury trials is a powerful way in which the public gets some control over their own destiny by being a part of the justice system. It is a lot harder to corrupt 12 randomly chosen jurors with other jobs than it is to get at one judge who you can count on for repeat business.
What field next (Score:5, Interesting)
It is always sais that people should be responsbile and learn new skills and train in a new field. When the farm economy shifted to manufacturing, people learned factory work. When manufacturing started to be offshored people were advised to get into IT. What field should people start to train in? Bush talks about training displaced workers, but I haven't heard anything about what their supposed to train in. What is the next new economy, retail?
Re:What field next (Score:5, Funny)
Re:What field next (Score:4, Funny)
Or maybe just fertilizer.
Re:What field next (Score:3, Insightful)
How can a nation exist with only management? (Score:5, Interesting)
Re:How can a nation exist with only management? (Score:4, Insightful)
20 years later: All the major US IT companies are entirely managed from outsource companies, with only Board and stockholders in the US.
Then all the rich IT workers in Singapore will buy up the companies in hostile takeovers as aging American stockholders liquidate at a bargain, kick out the Board, install their fellows in leadership...and we will have finally exported wholesale a trillion+ dollar industry in record time. The Roman Empire took several hundred years to pull that off.
And this is...a good thing? Looks like giving away the farm. Well at least the Singaporians won't contribute to the Republican Party so then maybe we'll elect...oh wait, I suppose they will contribute illegally, or by proxy. Never mind. We really have given away the farm.
Re:What field next (Score:5, Interesting)
Re:What field next (Score:4, Funny)
The following is a true story:
Guy gets his current model year Toyota 4Runner with 60k miles up to a shop, and says he wants a new engine. The mechanic looks at him like he's grown a third head, and asks who told him that he needed a new engine. The customer refers the mechanic to the Toyota dealer.
Mechaic calls the dealer and starts trying to figure out what exactly happened. Dealer mechaic says that due to a lack of maitenence, the warranty won't cover it.
Mechaic talks to the customer. Apparently, the customer *NEVER CHANGED THE OIL* in the vehicle. Removing the oil pan drain plug confirmed this, as the oil was mostly gelatonous (sp?) black sludge. It's kind of hard for a regular oil pump to move stuff the consistancy of jello.
Re:What field next (Score:5, Insightful)
Most economists/capitalists used to say that the market will sort this sort of thing out. Their highly simplified models of humans tell them that when labor markets shift and jobs go overseas, unemployed workers can simply retrain. However real people aren't always retrainable. Sometimes the 52 year old factory worker can't go out and learn something new. Also, most jobs with a similar skillset might become filled rather quickly. For instance, many people suggest unemployed IT workers should start a local IT support business. That may work for a while, but soon that market is saturated.
I think in the end there is a real unavoidable cost for outsourcing and it would be great to hear an economist admit it instead of simply glossing over it with tales of the invisible hand. Then we can consider what measures society/government can take to bridge the gap between economic theory and reality.
I'm not against outsourcing, however I think there needs to be a great deal of focus on retraining, extending unemployment compensation, incentives for early retirement... whatever a more detailed study than I'm willing to undertake would prove effective in helping the newly unemployed.
Re:What field next (Score:5, Funny)
The death industry.
The systematic selection of troublesome individuals, their removal from their community, and the necessary legal and moral stategies for justifing the selection and elimination of this individual.
With the population rapidly expanding at a far faster rate than ability of current political and economic systems to absorb these new young people, the death industry will be the fastest growing new industry of the twenty-first century.
There will be many new opportunities for lawyers to devise legal justification for murder, new openings for religious leaders to develop theologies endowing God's grace on murder (built opon the initial explorations in this field by Wahabi'ists of Saudi Arabia to justify the mass murder of Americans and Israelis through terrorism), new positions for technicians to design and maintain the machines of murder, and scientific and academic positions for modifying the crude 20th century weapons of mass destruction into the focused depopulation engines of tomorrow.
If you find yourself bothered by the reminants of morality and conscience when transistioning to your new career, you'll find the recent development of powerful psychoactive drugs designed to neutralize this area of brain chemistry most helpful.
Re:What field next (Score:4, Insightful)
Pyramid Schemes. I will be happy to train you in the lucrative field of scamming people out of their money for $2000 + 10% of what you eventually collect from the trainees you go out and recruit for yourself (and 10% of your 10% take from them, and so on and so on...) If you are at a loss as to who to recruit, start with everybody you've ever known. Once they stop talking to you and begin to specifically dis-invite you from parties, turn to spam. Bothering people in coffee shops is good, too. It can't fail!!!11!1!
Or you could teach English in Japan. It hardly pays anything, and the hours are insane, but rumor has it that American men are considered very sexy over there... even the geeky ones! It's a nerd paradise, where grown-ups play video games, everybody has cell phones, and there's no shame in loving bad J-pop music and anime! Woo-hoo!
Or you could just stay in the IT industry and wait another month or two. Seriously now, the company I work at is already hiring a bunch of new people, and I hear from the people on my "job network" that the situation is similar all over the place right now.
Re:What field next (Score:5, Interesting)
The most rational set of questions to ask start with the most imporant ones to Investors.
[1] How many dollars of dividends has your company been able to pay to their shareholders as a result of "Outsourcing?"
[2] How much has your compensation risen including all factors since you began "Outsourcing?"
[3] How many dollars of payroll did you save as a result of "Outsourcing?" Be sure to include any Executive Raises as countervailing factors.
[4] Have you had any of your Intellectual Capital Stolen as a result of "Outsourcing." This is probably the biggest and worst part but it never gets talk.
[5] What Liability does my company incurr if data handled in "Outsourced" facilities is diverted to ILLEGAL Purposes such as Identity theft?
[6] What legal devices do we have to deal with employees who misuse data we "Outsource" the processing and service of.
[7] If the data or programming serviced is "Outsourced" what does it do to National Security. This is a common problem with Defense Contractors now. Most outsourcing functionally becomes Industrial Spying for the company Hired to service in the other country.
[8] Does outsourcing this service cause the development of competition which may destroy the operation?
After the issues of Company profitablity are discussed then get down to the other issues.
[1] Are you Receiving assistance to be in business from State or Local Governments such as Industrial Development Bonds etc?
[2] Do you meet the US EEOC requirements in the employement of all of the Outsourced employees? (Age Sex etc discrimination) Most Outsourcing actually is a masquerade for some form of racism or sexism.
[3] Do you deal with the US Government directly or as a subcontractor? If so how do you expect the government to be able to pay your contract if everyone avoids paying US Taxes by "Outsourcing"?
[4] Do you expect the United States Government to protect your operations using if need be Military Forces to make sure your trade is safe? If so how do you expect to have it paid for when you avoid paying the taxes which support it by "Outsourcing?"
[5] Can you point to any nation which has benefitted by lowering wages and reducing its standard of living?
[6] Do you like trading in the lucrative market in the USA? If so how do you think that it will remain lucrative with you and others "Outsourcing."
[7] Are you as an American Incorporated Company benefiting by US Laws, Currency and infrastructure? If so how do you expect this to be maintained if you continue "Outsourcing."
Then you can come down to the issues such as the effects on Citizens generally. These include:
[1] Do you believe that United States Citizens have any rights in their own land that arise from Citizenship? If so what are they? If so how do your actions affect these rights?
[2] What value do you believe should be placed on loyalty to your fellow countrymen?
[3] How important is the USA to world safety and prosperity with regards to the cost of lives and treasure from US Taxpayers taken to pay for these actions and conditions?
The whole set of issues here address the matter indirectly but they completely attack the reasoning behind the "Outsourcing" game.
Re:What field next (Score:5, Insightful)
Nurses get all the shit, all the repsonsibility, and none of the respect. The hospitals try to keep the number of RNs to a minimum, giving nurses up to 15 patients at a time.
My wife is an RN, and she's told me horror stories about this sort of shit.
If the hospitals could outsource nursing care, they would. Actually, they do. It's called "registry nurses".
Re:What field next (Score:5, Insightful)
I don't know if my friend is still working for a registry. I know she started looking to get a regular job as soon as she realized how messed up the system was. I don't see how registrys can keep treating their nurses that way and hope to retain employees.
The situation with nurses seems ripe for unionizing--high demand for workers and poor treatment of employees.
Re:What field next (Score:5, Interesting)
The parent here is a fool lost in the smokescreen the "Outsourcing" crowd puts out. Nurses don't earn that kind of money in the first place except in extremely high priced regions like San Francisco. Second the industry is outsourcing. You see I am an RN who left the profession because of outsourcing and the criminally bad management of the industry. I retrained as Software Engineer.
The "Shortage" of Nurses is entirely smoke and mirrors put out to justify what currently is UNLIMITED H-2 visas being issued by the BICS for NURSES. They even took 3 years as work in any medical field as equal to 1 year of College for RN. Thus you could have someone soon caring for you who knows nothing about nursing except cleaning beds. But Ignorant fools like the parent of this post will not learn until it is they themselves who get no care or are hurt. By then they will be too weak and too broke to be able to fuss.I personally watched in Nashville Tn while the heads of Columbia HCA were arrested for RICO Violations in a "No Knock Raid" on their HQ near Centennial Park. I have seen their actions first hand and know how illegal they are. The claims of Nursing Shortages and High Wages are put out by people those kind of people.
Re:What field next (Score:4, Insightful)
Summary (Score:4, Insightful)
*For ENTIRELY unrelated reasons, obviously. No hypocrisy here at all
Documentary perspective (Score:5, Insightful)
So, here is the deal: Documentaries are often about perspective but ideally, they are about finding the truth and revealing that truth to your viewer. Political perspectives are going to be difficult to get, but contact someone like Robert Reich who could place you in touch with a variety of folks in and out of the political scene.
bob@RobertReich.org
Robert Reich
P.O. Box 381483
Cambridge, MA 02238
(617) 547-2206
Fax: (617) 498-0048
Try the Bureau of Labor Statistics (Score:3, Informative)
The best factual source for these numbers is directly from the Bureau of Labor Statistics [bls.gov] of the US Department of Labor [dol.gov].
Their March 2004 Report [bls.gov] is online, as well as archives of past reports.
Do NOT rely on any "statistics" from politically motivated people or organizations such as Robert Reich, or even any Republicans. Anybody can manipulate and cherry pick numbers to make them fit their political agenda. Use the BLS numbers only!
Unfortunately since almost all documentaries seem to be created for po
Re:Documentary perspective (Score:4, Insightful)
How about instead we just ask how it's helping or hurting people. The well-being of the corporation is irrelevant, since a corporation is a means not an end, or at least that's the way it should be. The purpose of the corporation should be to improve the lives of people, and should corporations fail to achieve that, they should be reformed or abolished. If corporations are hurting but the overall lot of humanity is improving, then so be it. I can certainly live with that.
The biggest question... (Score:5, Insightful)
Re:The biggest question... (Score:5, Insightful)
But Walmart is still giving people what they want - it is obvious that lower prices are more important than the perceived threat to their communities, or they wouldn't shop there. I answered the question: what responsibility does the company have to the consumers in the nation to which it supplies goods? And let me tell, a new "Super" Walmart opened recently in my community, and while I haven't perused the parking lot, I need to pass by it. It has significantly altered traffic patterns (to their detriment), and I see all manner of cars going into the parking lot: from old beater Ford Fiesta's to Lexus SUVs. People ARE CHEAP.
It's usually a catch 22: companies can outsource overseas and give the consumers the lower prices that the consumers are demanding, or they can keep higher prices and perhaps advertise that the items are 100% locally made.
Let's be honest, if they do the latter they will lose money and eventually go out of business because competitors are charging less. The consumers demand the cheapest prices. It's been shown time and again.
Let's look at the airlines, for example: how many people pay for first class? How many airlines have cut food service? How many have reduced row spacing to cram in more people? We all complain about it, but then we get the absolute cheapest price we can. When most people get a ticket, what is their first question? Is it "how much legroom on your planes?" Please.
People, in general, are just not being realistic. They want low prices, but they want to keep the higher paying jobs here. They want more room and better service on the plane, but they only buy the cheapest ticket they can find. They want Walmart prices, but then complain that Walmart is ruining their community. Too bad... pick one and suffer the consequences. We already have; the American consumer has spoken, and he wants the cheap price even if he's treated like crap to get it.
This may not represent you, it's certainly doesn't represent me (there's a number of stores I will not shop at for these reasons and more), but it IS the majority of American consumers. They demanded Walmart, they got it, and they should stop whining about it.
Do overseas workers cause more problems than... (Score:5, Interesting)
Re:Do overseas workers cause more problems than... (Score:3, Interesting)
Well, if you want to know this ask, IBM, GM, Ford, M$ and hundreds more that are international companies and do this all the time. This isn't an outsourcing issue. Many compnaies have been doing this for years so to add another location isn't tough for them.
"With overseas call centers, do you keep enough future customers due to deficiencies in customer support to make it financially viable to continue offshoring
Ask the other side's arguments. (Score:5, Insightful)
For example, ask the anti-outsourcing advocates what the cost in non-visible jobs is by engaging in protectionism of the highly visible tech jobs lost to outsourcing.
Then ask the pro-outsourcing folks a question like how will the economy absorb the displaced workers resulting from outsourcing.
This will make each side actually defend their position instead of using you as a sounding platform for their agenda.
Just one question (Score:3, Funny)
Dear Krishnan,
Where will the film be produced?
while you're over there doing research and such... (Score:4, Funny)
can you find me a job?
I will probably lose karma for this (Score:5, Interesting)
My question is
Re:I will probably lose karma for this (Score:3, Interesting)
Economy.. (Score:5, Interesting)
Several questions here... (Score:4, Insightful)
Since NAFTA's initial rush, there are reports of manufacturing jobs coming BACK from Mexico. That "giant sucking sound" that Perot used to describe maquilladora companies running for the Mexican border never really materialized in the volume he thought it would. Also, several of those factories are coming back, as they get better productivity from USians.
One function of outsourcing is that the labor is cheaper, which shows up quickly on the company balance sheet. If revenue is stable, and costs go down, profit goes up. What doesn't show up quickly is ineffeciency. e.g. Time lost due to cultural differences, time spent rewriting poor code, the cost of having to negotiate every change request, and so on. While these costs exist for locally sourced companies, I'd argue they're probably lower.
It's not strictly the price of the labor that's at issue, it's performance per dollar spent. Given the economic mess, it's all about the price of the labor right now, but the efficiency argument will start creeping back in over time.
The multiplier is the key here. Does the money just go back into company coffers, or is it actually distributed?
If it's held as cash by the company, then its effect is negligible, except for the value of the company's equity. It's not used to buy things in the local market, which contributes to the bottom line (and profits, and eventually more purchases) of the various merchants, and so on.
If it's distributed as dividends, is that money used to buy goods in the local market, or reinvested? I would suggest that the supplyside economic model can be criticized here, as dividends paid to stockholders at large might tend to be reinvested (sometimes automatically, sometimes not), and the economic multiplier for that cash is very, very small.
If it had actually been used to pay a local programmer, who was using it to live, then the majority of the money is probably circulating freely, having been spent with merchants.
We can get into issues with the WalMartization of the planet here, but let's not.
Again, this is arguable. Sure, we're helping them in the short term, but we've all heard stories of how the Indian outsources are getting undercut by the Czechs, or the Philipinos, or the Malaysians, or whomever.
I'm not sure, but I think this is the core of the globalist "race to the bottom" argument. If you assume that the company only cares about workers/$, then it would be logical for the jobs to drift towards the cheapest labor. Problem is, the cheapest country for labor changes periodically, and suddenly you have several countries vying for the lowest price. Does this unstable economic injection actually help their economy in the long run? Tough call.
What kind of car do the complainers drive? (Score:4, Insightful)
I am so sick of people whining "outsourcing sent my job to India" then walking out the door to climb into their Toyota. I'm sorry that your job has been outsourced, I am. But don't you realize that your decisions sent others to the same fate--where was your sense of moral outrage then?
Re:What kind of car do the complainers drive? (Score:3, Informative)
Just nit-picking here, but for a while, Toyotas have been made in Mexico, and within the past year or so have moved their base of operations into the US.
Nissan is also locally made, in Texas and Mexico. Next time, try ranting with Honda, Daihatsu, or some other obscure company that makes bad cars
Re:What kind of car do the complainers drive? (Score:3, Insightful)
(An oddity I noticed.. The Big Three only go so far as say "US/Canadi
Re:What kind of car do the complainers drive? (Score:4, Insightful)
While most registered voters don't actually take to the polls on Election Day, your purchasing activity on a daily basis is an incredibly powerful statement of your personal preferences. Corporations spend billions of dollars annually trying to better understand these preferences and more profitably satisfy them. What people fail to realize in this whole debate is that "fault" (I prefer to think of it as causality) lies not with the PHB or the low-paid outsourcer, but rather with the Almighty Consumer, which sends a clear message to the marketplace: Price Matters Above All Else.
If "Buy American" campaigns actually resulted in people changing their spending habits, you'd see offshoring initiatives dry up. But they don't - given the choice, consumers have consistently gone for lower prices instead.
Effect on the economy? (Score:5, Interesting)
question about staying ahead (Score:5, Insightful)
At the rate we are going with outsourcing jobs and having decreasing technical educational levels (studies have shown drops in math in science all the way through college) by the time i am old we will not be tha major world power anymore. Other countries will have taken that from us.
Local effects (Score:4, Interesting)
Are these positive and negative effects distributing themselves evenly through these societies, or is it effecting and effected by existing class and social structures?
Information security (Score:5, Insightful)
How will my SSN and other personal information be secured from workers who have zero responsibility to secure it, from a legal perspective?
Where does the money go? (Score:4, Insightful)
Isn't offshoring just a way to make the rich richer without regard for the American working class?
Isn't it evidence that the wealthy have no regard for those who must do work to stay alive?
Isn't it an utter repudiation of the widely held belief that concentration of capital is good for all of us?
Isn't it a strong reminder that the only thing that keeps capitalism alive is tolerance of the working man for the profligacy of the non-working class?
I'm no socialist, but I know a revolt when I see one coming. The rich in this country will be lucky if they aren't killed, cooked, and eaten before it's done.
Re:Where does the money go? (Score:5, Insightful)
1. America invests more in European nations and Canada than third world nations. So they aren't discriminately trying to destroy the 'working class', but trying to see who is willing to do the best job at the lowest price.
Finally aren't all those Indians 'working class' as well? What about their life? Or is geocentrism clouding that obvious reality?
2. Don't the poor have this same ideal, they just suck it? This is simply idiotic bigotry against rich people. Some people are rich because they earned it, and some people aren't. Similarly, some poor people are poor because they deserve it, and some aren't. Get over it.
3. Capitalism is good for all of us in the sense that every other economic system has been terrible. Capitalism is not perfect, it's simply better than the alternatives.
4. WRONG. If you were to exile all 'rich' people in American to other countries we'd all be much worse off. People aren't poor because rich people are 'exploiting' them.
Stop foisting blame upon others and take responsibility, and maybe a few economics classes while you're at it.
Re:Where does the money go? (Score:3, Interesting)
2. Most of the poor don't suck at anything. But concentration of property rights and social contacts creates a higher hurdle for attaining wealth than many of the current wealthy families had.
3. Capitalism is good when it is regulated. Unfettered capitalism is like a car with a turbocharger, no brakes, and an eternal downhill slope. It tears itself to pieces every
I have two actually... (Score:4, Interesting)
- What effect has losing a job to out-sourcing had on you personally, including all aspects -- mental, physical, financially, etc. (This one obviously needs to be asked to someone (or many someones) who have lost a job because it got outsourced.
- Who is supposed to pay for tech workers retraining themselves in new fields? I see so many companies/organizations saying that US tech workers even enjoy retraining for new fields, but they never mention how a newly unemployed (thanks to outsourcing) person is supposed to PAY for that retraining.
Personally I would LOVE to see the people who go on about US tech workers just need to retrain for a new field asked #2. I doubt you'll find many (if any) that will answer on the record though.Is the fiscal argument real? (Score:5, Interesting)
Is the outsourcing really cheaper when the total costs are figured, or is this move a way to show shareholders that you're doing some cutting in the down economy?
Two Questions - one from each "side"? (Score:5, Interesting)
Future of Indian outsourcing (Score:3, Interesting)
How do you think the rising salaries in India are going to affect the current outsourcing trend?
How is it different than Robotics? (Score:4, Interesting)
But if, instead of DELL writing programs, it's 5 guys in Bangalore, and my computer simply acts as a communications point, then suddenly we're getting out the pitchforks and torches? Why the difference? I ask my Economics classes this every course, and I've yet to hear a reasonable answer...it all comes back to "but those are PEOPLE", as if them being Intels, or AMDs, or chickens would make it more acceptable.
Remember the scare about robots in the 1980's? Remember the chicken littles running around warning of the disappearance of jobs in America, as we were all replaced by robots? It's happening again.
PC.
Re:How is it different than Robotics? (Score:3, Informative)
And what about NEXT quarter? (Score:5, Interesting)
Considering this, can the short-term financial gains really offset the long-term benefits a loyal and motivated workforce provide?
Impact on housing and automobile markets (Score:3, Insightful)
White man should see this coming. (Score:3, Insightful)
Now, Indians take away precious, precious income from white man in return.
What goes around comes around, as white man says.
What KIND of jobs? (Score:3, Interesting)
Yes, IT jobs seem to be outsourced to foriegn countries, but specifically what sectors of IT, and for what purpose? Not for what gain, as that is fairly obvious - saving money - but what is the function that these outsourced jobs fill? For call centers, this is fairly obvious, but what about for programming? What kind of programming is being done off-shore? What kind of programming cannot for saftey reasons, intellectual property reasons and other reasons be moved out of the US?
Similarly for other sectors of the IT field - what are the limits, and why?
Real Reasons? (Score:5, Interesting)
I'm on record for saying that working 100, 80, even 60 hours per week regularly is dysfunctional and counterproductive. There are other management fads that are likewise dysfunctional and counterproductive.
To what extent is outsourcing being driven by staff resistance to management demands? What kinds of demands are being resisted?
This question can be put to both the pro and anti sides.
Paying the price for getting rich. (Score:3, Insightful)
The people of the rich countries hve been happy to eat cheap (though artificially expensive!) food for years.
The short term costs to the newly jobless are high but in a world ecnomony eventually the disparity between one country and another should shrink, unless the disparity is kept open artificially.
Seems not many are complaining that their cheap laptops are built from cheap labour, or cheap shoes. Take a look at the balance of trade for the countries of the world. The US and UK are net importers. China and Taiwan are net exporters. One should consider the long term consequences of this pattern.
We have exploited the disparity for a long long time.
When the pony comes home, pay up, pay up, pay up.
Is it worth customer irritation? (Score:4, Interesting)
I guess my question is: Is it worth the savings to piss your customers off, esp. when they are paying top dollar for good tech support on a per-call basis? On another front, Have these companies had good results overcoming the language barriar (that, according to a programmer friend of mine, ends up causing more problems for a project, resulting in more time cleaning up the mess that misunderstanding brings than executing the project)?
Supply and Demand, indigenous development (Score:4, Interesting)
If instead of reducing outsourcing we tried to send more work to India, is it conceivable that we could bring up their salaries to a point where they would no longer compete on price?
Also, can we expect some of those Indian programmers and companies to do more work on fulfilling their own software needs, and stop chasing outsourcing work?
I applaud your objectivity and your humility (Score:4, Interesting)
I also like the fact that you don't claim to have all the answers in advance. So many reporters and filmakers are too arrogant to ask for assistance. A truly awesome idea to ask everyone you can about this before filming. Nothing pisses me off more than some 60 Minutes piece that (invariably) fails to interview the other side.
Agenda-based "reporters" rarely find the truth. You might find that outsourcing is terrible, but you appear to be objective and thorough, i.e., the opposite of Michael Moore.
My golden question: Ask the labor unions to explain how they can reconcile their push for high wages and benefits which are completely non-competitive with foreign workers, and then have the audacity to complain about outsourcing, rather than take some of the blame (how's that for a leading question?).
I'd also ask the managers of large pension and mutual funds how outsourcing affects their stockholders, and ask them to describe who, exactly, those stockholders are. The answer might surprise most people.
Good luck!
Spread of US Culture? (Score:4, Interesting)
I've read in stories about call centers / tech support outsourced to other countries that the employees are often coached on how to pass as Americans.
They work on their accents to appear more American, learn about American sports teams and pop culture in order to be able to make smalltalk about it and appear authentically American, etc.
I'm curious to know the effects this has locally and what the opinions of it are. Do any of the employees have problems with this deceptive practice? Do they feel that it's making some kind of statement about the (theoretical) superiority of American culture that they're forced to learn about it and utilize their knowledge of it instead of that of the culture they grew up with? Are there ever, for example, new baseball fans created by an offshore call center worker's exposure to the sport for his/her job, or is this almost always purely business for them? Does this happen in other industries? Do more traditional members of the local societies object to the poisoning of their children with this American culture?
I think there are a lot of interesting questions to be asked there. It's not involved in any way with the causes or primary effects of outsourcing, but from the perspective of social psychology alone the answers should be fascinating.
competitive pressure (Score:3, Interesting)
- What is the exact nature of the competitive pressure compelling CEOs to outsource labor?
- (Everyone else is doing it.)
- So these other companies that "did it first" and thereby decreased their costs, passed this on to the consumer in the form of reduced prices?
- (That's how the market works.)
- Uh, huh. Ok, given that the inflation rate has remained pretty much constant, if not growing slightly, during this period of outsourcing, is it fair to say that the trend of outsourcing is, in fact, not driven by market forces?
- (Well, uh, the market is very complex...)
- If a group of companies collectively decide to engage in behavior to the detriment of their consumers (prices haven't dropped) and employees (who are out of work), and this behavior is not market driven, can you explain it in the context of antitrust law?
No further questions, your honor.Why? (Score:5, Insightful)
Re:Why? (Score:5, Insightful)
where are the H1-B CEOs?
which US companies have relocated their CEOs to foreign countries, rather than just their head office?
When we know the answers to these questions, we will...
What is the government's obligation to citizens (Score:5, Interesting)
The one I'm most interested in is this: what obligation does the government have to its citizens? Should it do whatever it can to facilitate profits for businesses? Should it do whatever it can to maintain/attain a high standard of living for all its citizens. Most communities form out of self-interest. They gain more by being together than apart, and often hard compromises are necessary where individuals must give up something for the common good that they've agreed to support. My feeling is that citizens, government and business have all lost any sense of this commonality of interest. So the first question I would ask is: who gains by offshoring and is that gain for the common good or for a specialized good. My feeling is that it's really for a specialized good, large corporations, but I may be wrong. But I do think this is the most important question to ask.
Debt to Employees (Score:4, Interesting)
Where does it stop? (Score:3, Interesting)
PS: I know this is not one question, but they all closely related.
Some suggested locations to film (Score:5, Funny)
What about failures? (Score:4, Informative)
American companies outsourcing to be competitive (Score:3, Funny)
Outsourcing alternatives? (Score:5, Insightful)
2. Many unemployed and about-to-be-unemployed US engineers would be happy to work for less money (within reason)in order to keep their jobs, however when this is suggested to companies the companies usually choose to go with outsourcing. If an engineer is willing to take a 30 - 40% pay cut to save his/her job, why isn't this offer taken seriously by most companies?
3. (related to 2) It's quite clear that if we want to continue working in the engineering fields in America that we'll either have to become much more productive (2 - 3X) or we'll have to accept much lower wages (or a combination of the two). By some measurements we're already much more productive than our overseas counterparts by virtue of the fact that we have more experience with real projects, so it all comes down to money. What can American engineers do to lower their cost of living in order to try to compete with 3rd world salaries?
4. Most offshoring advocates say that we need to just be patient as we await the 'Next big thing (TM)' that will be invented in America (they have a lot of faith). Any idea what the 'Next bit thing' will be and what do we do in the meantime?
5. (related to 4) In the software arena, most of the offshoring advocates say that US developers need to 'move up the foodchain' into project management. Given that you never need anywhere near as many managers as you do managees, what how will most US developers 'move up the food chain'? (perhaps they'll become hunters)
6. (related to 5) What if you'd much rather develop code than manage projects?
7. For outsourcing advocates: Why not make the argument that we should outsource every possible US job to cheaper, lower labor-cost countries and then bring in 'guest-workers' to fill the positions that can't practically be outsourced? It seems that the outsourcing advocates would find this a favorable plan since there would be so much potential money savings. If money savings is the primary economic motivator then this seems like a logical plan, however, what do we do with the millions of US workers that would be put out of work in this scenario?
Commentary: The outsourcing advocates take a very narrow view of economics. To them cost-cutting is the primary motivation for doing anything - "if it'll save a buck, then do it" is their motto. However, it isn't clear that the money savings from outsourcing white collar jobs are actually going to be able to counter-ballance the economic devestation brought on by widespread offshoring. So what if US corporations suddenly become wildly profitable (for a quarter or two) while millions of workers are put out of work. Eventually those millions of unemployed workers won't have the money to buy the products of the wildly profitable corporations and profits will go down. I'd rather see corporations break even while providing good jobs to millions, than see them be wildly profitable but providing no jobs to US workers. Oh, and if millions are unemployed, who is going to pay the taxes to support the schools that we supposedly need to train workers for the 'jobs of the future'?
What jobs are there beyond "knowledge"? (Score:5, Insightful)
During the 1980s, blue-collar manufacturing workers whose jobs were offshored were told to retrain in some other area, particularly knowledge jobs. Some did, most others moved into other blue-collar jobs such as construction, automobile repair, and other such jobs which aren't so easily offshorable.
Today, the message from economists and CEOs is the same: retrain in some other field. We know that jobs in programming, software-engineering, and most other fields of engineering (electrical, mechanical, chemical, etc.) are being offshored.
So what exactly does one retrain in? Let's look at the options:
* Biotech -- is there any reason that new biotech jobs can't be created overseas instead?
* Nanotech -- is there any reason that new nanotech jobs can't be created overseas instead?
* Medicine -- oooh, wait, radiology is already being offshored [cbsnews.com], and so are surgical jobs [worldnetdaily.com]
Note that those are all technology-oriented jobs which do not require one's presence. What technology-oriented jobs require one's presence then?
* Auto mechanic -- for the few geeks who can tolerate working outdoors, with their hands, getting dirty, etc.
* IT technician -- the basically blue-collar guys who schlep computers around, run cables, and replace bad hardware
* Nuclear engineer -- because It Is Stupid to not have people on-site to prevent a nuclear plant from going boom in the event of an emergency
So, can the hundreds of thousands of software geeks who have had their jobs offshored retrain to be auto mechanics? Even if they wanted to, I doubt they could, and as cars become increasingly-reliable, demand for those jobs will decrease. IT technicians? We have a glut of them as it is. Nuclear engineers? This nation is too scared of nuclear power (thanks to Chernobyl and Three-Mile Island) for there to be much of a market for nuclear power.
So, what do we do? Just what jobs are there beyond "knowledge" jobs? If you assume that international trade (and preferably free trade) is a good thing -- as I do, due to comparative advantage -- then you must admit that many of these jobs can go overseas now thanks to the Internet's ability to send data worldwide at dirt-cheap prices.
Now, the standard economist's response to that is that "new jobs will be created as a result of trade." On the face of things, this is true.
But return to the fact that the Internet makes all jobs which deal primarily with information (instead of people) offshorable. Given that fact, what reason is there that the new jobs -- which WILL be created, just as economists tell you -- won't be created overseas, but will be created here in America? Again, is there any reason the new jobs -- which we can reasonably expect to see in biotech and nanotech -- won't simply skip the step of being created in America and instead get created in India first?
I wrote an email to one of my economics professors asking that question (and many others) recently. His response? "Gee, you know that's what interests me about economics so much - why do these things happen?" But he never really answered the question.
If a college professor in Econ. doesn't know the answer, who does?
Question 2: Education.
Often the advice to unemployed IT geeks is to retrain. Retraining requires education. Education requires years of time and money.
Simple question: Where does an unemployed IT geek *get* that money to retrain with, given the rapidly-rising costs of a college education?
Moreover, how can America -- which largely does not subsidize post-secondary education -- compete with foreign nations which do subsidize post-secondary education?
So long as this educational barrier-
Analyst on CNBC (Score:4, Insightful)
He said, paraphrasing, "America, which for the last fifty years or so has been consuming vastly greater amounts of resources than they produce, has had an artificially high standard of living. Its going to be painful until the American lifestyle comes more in line with the rest of the world."
Just thought I would relate that observation. It seemed appropriate when the topic of outsourcing and offshoring comes up. You can take it as either playing devil's advocate, or something to get you motivated to ensure that it doesn't happen.
Questions for outsourcing opponents (Score:4, Interesting)
2. Do people in India or China have less right to make a living and feed their families than Americans do?
3. In a business, does management have a duty to artificially maintain relatively high wages in the US for equivalent work? Is that a higher duty than their duty to the shareholders?
4. What duty do the workers owe management in return?
5. Would you support relaxed regulations and tax cuts to help bring the cost of US labor down closer to that of foreign labor?
6. Which world leader is more just: George Bush or Fidel Castro. (This is just to determine who you're talking to.)
India has a high education level (Score:5, Insightful)
Africa doesn't have the education levels, yet. But when they do, we'll be there.
Re:India has a high education level (Score:4, Insightful)
Re:Customers (Score:3, Interesting)