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Congressman Jay Inslee (D-Wash.): "U.S. won't stop outsourcing to India"
siliconindia ^ | Wednesday, May 28, 2003 | IANS

Posted on 06/04/2003 10:38:59 AM PDT by Willie Green

For education and discussion only. Not for commercial use.

U.S. companies will continue to outsource jobs to India to cut costs despite a move by some American states to curb flight of government contracts, said Congressman Jay Inslee.

NEW DELHI: "People are worried about job security in the U.S. and therefore it is not terribly surprising to find a few people who will oppose outsourcing to other countries," said Inslee, a member of the Democratic Advisory Group on hi-tech issues.

"Some people may support the promulgation of legislation to ban outsourcing but the majority of U.S. industry and policymakers are not in support of creation of new trade barriers," Inslee, who is on a visit to India, told IANS in an interview.

"I don't think it (a ban on outsourcing) is going to happen. We want to keep our doors open. I believe any effort to restrict market access will adversely impact the U.S. economy. The policy of protectionism will not take us anywhere.

"For any economic growth to occur, a country needs to add more value to its products without increasing the cost and outsourcing to India helps U.S. companies do exactly that," added the Congressman.

The Indian government has reacted sharply against four American states -- New Jersey, Maryland, Connecticut and Washington -- reportedly proposing to ban outsourcing of government contracts to companies outside the U.S.

Commerce Minister Arun Jaitley said the move was against the principle of market access and India was placed on "high moral ground" to take it up at the World Trade Organisation (WTO) negotiations.

The New Jersey Senate had unanimously cleared a bill on December 16 preventing public enterprises in the state from outsourcing work, specifically to India. State Senator Shirley Turner had proposed the bill.

The bill prohibited public enterprises from shifting their call centres abroad for "cheap labour" with a view to creating more jobs for Americans as the unemployment rate in the U.S. had soared.

The bill was taken up for discussion by the Senate Committee in February this year but couldn't be passed and has now been put on hold. It is now likely to be discussed in the Senate next month.

Close on New Jersey's heels, other states like Washington and Connecticut are also reportedly mulling a ban on outsourcing contracts to India.

Inslee, a representative from the First Congressional district of Washington, however said there was no move in his state to introduce a bill that would make outsourcing difficult.

"Ours is a trade-oriented state and we will not take any step that goes against the principle of market access. Our ability to access other markets will diminish if we ourselves block access to the U.S. market. Trade is a two-way street."

India's vast pool of English-speaking and cheaper manpower, educational system and training programmes have helped transform the country into a global outsourcing superpower over the last few years.

India's software exports grew by 29 percent to $7.5 billion in the year to March 31, 2002, with some 60 percent going to the U.S.

The country's rapidly growing business process outsourcing (BPO) industry has virtually turned it into an electronic housekeeper to the world, taking care of a host of routine activities for multinational giants.

More than a quarter of Fortune 500 companies like General Electric, American Express, British Airways, HSBC and Citibank are shifting their back office operations to India.

Inslee, who is a part of the Congressional Caucus on India and Indian Americans, said Indian technology companies and professionals in the U.S. have played a very important role in the American economy.

"Indians in the U.S. have created tremendous intellectual capital and helped in the growth of the knowledge economy."


TOPICS: Business/Economy; Culture/Society; Foreign Affairs; Government; US: Washington
KEYWORDS: globalism; thebusheconomy
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To: TopQuark
Malaysian worker produces only 5 widgets and gets $4/hour

It's closer to $4/day. Offshoring sends American jobs to the Third World, and brings Third World poverty to America.

21 posted on 06/04/2003 3:16:40 PM PDT by Campion
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To: CIBvet
Mr Top Quack feels secure that he'll be able to hold onto his position in the ...

Silly and unfair.

TopQuark (note spelling) says something else: (i) get a pay cut and don't loos the job, and (ii) stop suing everyone in sight and demand a tort reform that makes our jobs costly to employers.

Aaaah, but you want your cake and eat it too. And you want others to pay for it.

Now, sir/madam: there is nothing right about a high school dropout at a Detroit conveyor belt --- which is the slowest in the world due to the powerful unions --- getting $30/hour. Nor is there anything right about the high school graduates unable to read (in contrast to the previous generations) and yet demanding the standard of living that their parents achieved by the end of their lives.

22 posted on 06/04/2003 3:21:49 PM PDT by TopQuark
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To: pwatson
The Richardson Telecom here in Richardson Texas has now lost something like 200,000 engineering, management and manufacturing jobs permanently in 2 years.

These 200,000 jobs, from the companies you list, were worldwide losses, not exclusively from the Dallas area.

How much fiber can be put in the ground? With market saturation, how many cell phones can Ericsson and Nokia build? The replacement market will take off again when number portability is approved, by the FCC.

Of course, that will force a further shake-out in the market as plans get more competitive.

23 posted on 06/04/2003 3:22:42 PM PDT by sinkspur
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To: Willie Green
Perhaps we should stop all free trade, and unionize, so we can all enjoy socialism together.
24 posted on 06/04/2003 3:25:56 PM PDT by MonroeDNA (Unions and Marxists say, " Workers of the world unite!")
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To: TopQuark
get a pay cut and don't loos the job

You don't understand. When a company offshores jobs, they typically don't give people the option of taking a pay cut. They simply lay them off. Typically entire groups or offices are wiped out. There's no discussion or negotiation involved. One minute you're employed, and the next, you aren't.

25 posted on 06/04/2003 3:26:12 PM PDT by Campion
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To: Campion
How much do you make? More than 10k per year? YEs.

Why aren't you "overpaid"? because my job is not being moved elsewhere.

Indian IT workers work for 8 to 10k per year. Know any Americans who support families on 8 to 10k per year without welfare?

That computation is incorrect (see an example in the previous post). You are not overpaid if you get more money than an Indian worker does --- you are more productive than he is. But if you are three times more productive and he makes $10,000 per year, then you should get $30,000 --- but not $40,000. If the latter is the case, the job moves overseas.

26 posted on 06/04/2003 3:26:55 PM PDT by TopQuark
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To: Campion
It's closer to $4/day. That's irrelevant.
27 posted on 06/04/2003 3:27:27 PM PDT by TopQuark
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To: Campion
When a company offshores jobs, they typically don't give people the option of taking a pay cut. They simply lay them off.

Yes.

This is because (i) offering a paycut is unacceptable in our culture, and (ii) insurance is too expensive.

I have been suggesting for some time different ways of instituting a pay cut, and I begin to see that happening. One large company in Midwest has asked ALL of the employees in a particular department to reapply for their jobs, while concurrently advertising these openings to the outside. I gurantee you that in the end: (i) the department will be smaller, (ii) average pay will be smaller as well, (iii) teh jobs will stay in the U.S.

28 posted on 06/04/2003 3:31:26 PM PDT by TopQuark
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To: TopQuark
because my job is not being moved elsewhere.

That doesn't mean you aren't overpaid. That means your job isn't being moved elsewhere ... yet.

You are not overpaid if you get more money than an Indian worker does --- you are more productive than he is.

This falsely assumes that management can measure productivity. In IT, they typically can't (or won't).

All management looks at is headcount and cost. The assumption is made that an Indian engineer is equivalent to an American engineer, only at 10% of the cost.

At this rate, there won't be an American software industry left in 25 years, or at any rate not one staffed by Americans. My kids already know that they would be foolish to follow Dad's career path. (I hope they all become lawyers and executives, so they can be the shafters rather than the shaftees.)

How well do you think America can be defended with smart weapons imported from India and China?

29 posted on 06/04/2003 3:34:12 PM PDT by Campion
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To: TopQuark
That's irrelevant.

Not if you're trying to compete with it.

30 posted on 06/04/2003 3:35:49 PM PDT by Campion
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To: Campion
This falsely assumes that management can measure productivity. In IT, they typically can't (or won't).

You are absolutely correct that any particular management team cannot do that. Even if it could, the process is way too expensive. But collectively management of the sector know that --- that's what economics is about. People can be silly individually but the market is wise.

In the case of IT, however, even the individual managers see the differences because the disparities have become so huge. If the American contract programmer (consultant, as they prefer to call themselves) say "I'll do it by 10 June" and submits a cost itemization listing his services at $75/hour, and an Indian team says "We'll do it by 20 June" and itemizes costs at $10/hour, the manager's response is, "I can live with 10 days of delay." That is one act of measuring productivity.

31 posted on 06/04/2003 3:47:07 PM PDT by TopQuark
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To: Willie Green
When people are getting overpaid (like the LA longshoremen, who make an AVERAGE of $120,000 a year--union, of course), us entrepeneurs will go where we get better work, for lower pay.

That's called, uh, capitalism. Don't like it? Move.

India can afford to hire only the best and brightest, for less money out of my pocket, and you get fantastic service. Here, we all know our home-raised IT support can be pretty lame. Just ask Dilbert.

Is South Florida, local hired IT support for a small business is a joke, and you pay through the nose for morons. Our lame-o guy has to reboot our server every-other-day, because he is too stupid to understand backups. I can't wait until we can outsource our IT support. That moron can go wash cars, or someting his IQ can handle.

Nice find BTW, a dem who supports free trade. Man bites dog. You and I both know that it's mainly Republicans who support free trade, with dems and buchannanites opposing.

See tagline.
32 posted on 06/04/2003 3:48:55 PM PDT by MonroeDNA (Unions and Marxists say, " Workers of the world unite!")
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To: grb
"Just how would you be subsidizing someone? "

We all subsidize overpaid workers, when we pay more for them, and get less, than we would elsewhere.

Or should my standard of living go down (less money to spend), because I should support the higher paid guy, who does less?

That is called socialism.

Marxism, actually.

33 posted on 06/04/2003 3:54:35 PM PDT by MonroeDNA (Unions and Marxists say, " Workers of the world unite!")
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To: MonroeDNA
Well said. Am I the only one wondering why the self-described conservatives on this board are either ingorant of the essense of capitalism or hate it openly?

I guess, nowadays, if one dislikes something like immigration, he feels that he is conservative.

34 posted on 06/04/2003 3:56:51 PM PDT by TopQuark
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To: TopQuark
People can be silly individually but the market is wise.

But the market doesn't act in a vacuum. How competitive do you think Americans can be when the government forces up the cost of hiring Americans every day, while encouraging offshoring in the name of "free trade"?

And, long term, don't you realize that these "overpaid" people whose unemployment you seem to applaud are your customers, too? Or, at least, they were your customers ... when they could afford to be.

I still want to know how you're going to defend the US with smart weapons built around software imported from Indian and Chinese software sweatshops.

35 posted on 06/04/2003 3:57:10 PM PDT by Campion
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To: Campion
I am sorry: I've done my best and cannot do any better. You do not seem to indicate either knowledge or even concern for basic economics and ingore the specifics I offer. You are welcome to retain your opinion, of course, but it is ill-founded.
36 posted on 06/04/2003 4:00:48 PM PDT by TopQuark
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To: MonroeDNA
That's called, uh, capitalism. Don't like it? Move.

See my post #35. It's capitalism, perhaps, but a capitalism overlaid with government rules, regulations, taxes, and litigation threats. All of those drive up the price of American labor, and make foreign labor more attractive.

And if you think that's cool, you're the one who isn't a conservative.

37 posted on 06/04/2003 4:00:57 PM PDT by Campion
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To: TopQuark
You do not seem to indicate either knowledge or even concern for basic economics

I've lived it, brother. You haven't.

38 posted on 06/04/2003 4:02:13 PM PDT by Campion
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To: Willie Green
Let's see....

A website called, of all things,

unionvoice.org

http://www.unionvoice.org/campaign/offshoring

states:

Take Action!
Tell Congress to Study IT Offshoring

Even if you've managed to make it through the tech implosion without losing your job, the next body blow may be just around the corner. It is increasingly likely that the job you have now may not even exist in this country in the very near future. Recent reports indicate that U.S. employers will move about 3.3 million white-collar service jobs and $136 billion in wages overseas in the next 15 years. IT giants such as Microsoft, HP and IBM are leading the way.

The results are clear for U.S. technology workers — increased job insecurity, lower wages and fewer benefits. Tell your elected officials it is imperative that the U.S. Congress launch an immediate study of this disturbing trend.




FR is being infiltrated by unionist/marxist creatures.

Everyone: click the article.
39 posted on 06/04/2003 4:03:30 PM PDT by MonroeDNA (Unions and Marxists say, " Workers of the world unite!")
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To: Campion
I've lived it, brother. You haven't.

You have not a clue of what I have lived through, but I am not going to compare misfortunes.

Most importantly, you do not understand the value of education: it's biggest gift is that you acquires something that you did NOT live through. Anyone can learn from his own experience, but education enrices you with the experiocen of the millions that live concurrently with you and have preceded you.

See, if education were required for someone to become a software "engineer," you would've known that without me saying so.

Buy a book. And make sure it's not on Java.

40 posted on 06/04/2003 4:06:13 PM PDT by TopQuark
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