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To: Myrddin; harpseal
Although the paper focused on Personal Computing industry, here's a relevant summary from a paper delivered during the first of this year on use of IT and Internet in this outsourcing that you two are discussing:

"The changes taking place in the computer industry value network raise important questions for national policy makers concerned with jobs, trade and technological competitiveness in their countries.

Using IT, the Internet and e-commerce, computer makers have been able to move production to low-cost locations while still retaining the high levels of coordination across the supply chain required by demand-driven production.

Partly as a result, the U.S. balance of trade in computer hardware fell from a small surplus in 1991 to a deficit of nearly $29 billion in 1998, and hardware production jobs in the U.S. have declined.

While U.S. consumers enjoy the benefits of cheap computers, and U.S. companies rely on offshore production to survive in a highly competitive market, the loss of U.S. jobs is an issue for policy makers.

Interestingly, even relatively low-cost locations such as Taiwan, Mexico and Malaysia are losing employment to even cheaper locations such as China. These changes are certainly not driven by the use of IT or the Internet, but the process is at least facilitated by those technologies. Policymakers need to be aware of these global transformations and their potential impacts on jobs and economic activity.

Whereas in the past, these transformations were limited to production work, there is evidence that U.S. companies are shifting knowledge work such as software programming and call center services offshore as well. They are using IT to support outsourcing to places such as India, China and the Philippines, with a potential loss of knowledge jobs in the U.S."

FROM

"The Role of Information Technology in Transformation of the Personal Computer Industry"

by Kenneth L. Kraemer and Jason Dedrick

Paper prepared for Transforming Enterprise, The First International Conference on the Social and Economic Implications of Information Technology, U.S. Department of Commerce, Main Auditorium, January 27-28, 2003.

336 posted on 08/07/2003 6:36:35 PM PDT by bwteim (bwteim = Begin With The End In Mind)
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To: bwteim
I really do not have a problem with the internet or the means of communication we now have and I strongly advise against any controls on that as they would in the end be counter productive. If we wish to limit the importation of software a rational tariff structure based on wage differentials and productivity differentials should be imposed. As I stated IT is a strategic industry and should be treated as such as should several ebngineering disciplines. Radiology reports used in the USA should be prepared by physicians liscensed in the USA.

These are really not difficult concepts levying imposts and duties is one of thepowers specifically granted to Conbgress in Article I of the US Constitution. The US Constitution is the Supreme Law f the land remember.

Why on earth would anyone wish to limit technology when that technology is the key to boosting productivity everywhere.

What I propose is stopping government subsidies and currency controls a temporary limited tariff to maintain or IT industry. manufacturing and other tariffs to maintain a certain level of industry and to use as bargaining chips to lower tariffs levied by other nations on American exports, balance foreign subsidies, and as bargaining chips to remove foreign non-tariff barriers.

343 posted on 08/07/2003 7:19:38 PM PDT by harpseal (Stay well - Stay safe - Stay armed - Yorktown)
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To: bwteim
Thanks for the reference. That supports my contention that IT and the internet are the enabling technologies that make outsourcing possible. One still needs a skilled set of workers who will labor for low compensation to close the loop. Indian workers are able to operate comfortably on 10% of U.S. income. I think the only way China will undercut them is via government subsidy. You can bet that will happen. It is less expensive than most military programs.
351 posted on 08/07/2003 7:35:30 PM PDT by Myrddin
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