Posted on 09/08/2004 3:36:00 PM PDT by Destro
Posted on Sun, Aug. 22, 2004
Business books: 'Exporting America: Why Corporate Greed Is Shipping American Jobs Overseas'
"Exporting America: Why Corporate Greed Is Shipping American Jobs Overseas," by Lou Dobbs (Warner Business Books, 208 pages, $19.95)
Look out, Silicon Valley! Bangalore, India, is gaining on you. Some folks in India even believe that their country's version of Silicon Valley has already surpassed its California counterpart as a center for high-tech employment.
In his new book, "Exporting America," CNN's Lou Dobbs shows how strongly that belief is held in India with a headline from the Jan. 6, 2004, issue of The Times of India: "Silicon Valley Falls to Bangalore."
The story under that headline, Dobbs writes, bragged that Bangalore has 150,000 information-technology engineers compared with 130,000 in Silicon Valley. Dobbs believes that that story can't be written off as merely nationalistic exaggeration.
"India is only one of the many countries benefiting from the exporting of American jobs. But it has also been one of the most aggressive in pursuing professional-level jobs, from medical technicians to software programs. American companies have been all too happy to answer India's siren call of educated English-speakers willing to work at some of the world's lowest wages," Dobbs writes.
General Electric's Capital International Services, Dobbs points out, was one of the pioneers of outsourcing domestic operations to India. The company, Dobbs writes, employs 1,300 at its four centers in India and says it saves about $400million annually by not having Americans do those jobs.
"The people there write software; they review invoices and insurance claims; they do market analysis. CIS also offers its services to other American companies looking for outsourced resources," Dobbs writes.
Although India lags behind other Asian countries in manufacturing, it has a leg up, according to Dobbs, in the service sector and is a magnet for some of America's highest-paying jobs.
"There are programmers all over the world, but the Indian Institutes of Technology (known as IITs) are turning out thousands of these programmers a year. They are men and women who are well-educated, speak impeccable English, and are thrilled to make $10,000 a year," Dobbs writes.
GE, as Dobbs makes clear in abundant detail, is only one of many companies outsourcing high-tech and professional jobs to India and other parts of the world where wage expectations are lower. Among the others spotlighted by Dobbs for outsourcing jobs to India, the Philippines, Romania, Ireland, Poland and other countries are IBM, SAS Institute, Intel, Microsoft, Perot Systems, Apple, Computer Associates, Dell, Hewlett-Packard, Oracle and Sun Microsystems.
Early in the book Dobbs delivers a broadside against the general trend of shipping jobs offshore. He says it is undermining the American middle class, putting Americans out of work, forcing Americans to work harder and longer for less pay, devastating some communities and depriving governments at all levels of the tax revenue for upgrading public education and providing other essential goods and services.
Dobbs, whose views on shipping jobs offshore have been under continual attack by advocacy groups and consultants for multinational corporations, takes the view that corporations who send jobs offshore are firing their own customers, because American workers will eventually find themselves unable to purchase the goods and services being exported back to America by American companies.
"India can provide our software; China can provide our toys; Sri Lanka can make our clothes; Japan make our cars. But at some point we have to ask, what will we export? At what will Americans work? And for what kind of wages? No one I've asked in government, business or academia has been able to answer those questions," Dobbs writes.
- Cecil Johnson,
Knight Ridder Tribune
I get concerned about that too. If we are a nation of serfs making our livings giving massages and toenail manicures to the tiny minority of elites, and we depend on foreign countries for our scientific and technical work, why shouldn't the US become ripe for an invasion within a generation?
HUH? I'm not running for anything. I certainly hope you aren't.
But that's a good thing, right?
One reason: last time I looked, China was a *totalitarian, communist dictatorship.* Chinese grad students have family at home (parents, aunts, uncles, sometimes wives and one or two children.) If they *don't* go home, guess who winds up in the lagoi.
Many Indians do stay here, if they can get the visa/residency worked out.
"Things change, but the US hasn't lost anything yet. It is only if we allow our country to drift into the socialist/communist mindset do we end up like old Europe."
What do you think has been happening to the US since the Great Society? It slowed down a little after Reagan was elected and a little more after the 94 lections, but now more and more citizens have less and less to loose, and have less and less hope for the future. Now hopfully they will see Kerry isint any better on trade/immigration issues than Bush is, but still, do you think a majority of American voters will continue to accept a falling standard of living?
If the Corps continue to gut the middle class, say hello to a social democracy, and goodbye to a free republic.
well unless you are running off money at the copy machine, or are able to go to your employer and ask for an instant raise to cover your increased gasoline costs - it is certainly reducing your disposable income level. for many americans, they maintain that level by going deeper into credit card debt.
sustained $2+ gasoline will change american's buying habits for SUVs/light trucks/minivans. and since that is the only profitable area for US carmakers, watch what happens to sales and profits at GM and Ford going into 2005 if gasoline stays at $2+.
Not the best wording I will admit. What I meant to say is no one owes the tax cutting, economically conservative politician their vote. This matter on outsourcing will come to a head sooner or later.
I was obviously using agriculture as an example for the sake of argument. So you got me. Make it snowmobiles.
who pays for their US college educations? are they returning home with $100K in debt, or are they getting assistance from their own governments, companies who sponsor them, even our government through grants to higher education, etc, etc.
in any case, its temporary. India already is cranking out natively educated IT graduates at a healthly clip.
But think of all those high-paying jobs in the oil services industry the U.S. will create if it enforces a mandatory minimum price of $3.00 per gallon. Isn't that the concept behind a tariff?
The same assistance is available to "Americans," yet they are not attending our engineering schools at the same rate as other "minorities." And many of those "minorities" are staying here and taking those jobs that "Americans" claim are too expensive to get. Do you think it might be because "Americans," when they graduate from high school, cannot find India on a map, or think it's a state between Illinois and Ohio? Has Lou Dobbs ever weighed-in on this issue?
Harley Davidson was saved by tariffs. and even today, the US has a tariff on imported light trucks, which is one reason why Mercedes and Nissan build theirs in Alabama and Texas.
I guarantee you, that if car makers made a big move to build assembly plants in China for all their cars, to bring them back to the US - you would see tariffs on those imported autos. Because the auto manufacturing industry is one of the few with enough political clout to make it happen.
It's simple. Most of them identify with multi-million dollar corporate executives and at the same time hate the great unwashed scum that comprise working Americans. The fact that most are unsuited for such positions by temperment, training or experience is irrelevent. They live vicariously through the corporate board room.
If we dilute that sector - the more people who move down the income scale, or who hold jobs where their compensation is provided in whole or in part by government (municipal workers, education, health care) - the more Democratic voters we create.
It won't matter in November. Bush will win on the terror issue alone. His lead, while not dominant, will prove to be insurmountable.
The dilution you speak of will have no effect come election day. But George W. Bush will effectively answer to no one come January 20, 2005. If and when the offshoring stampede picks up in earnest during a Bush lame-duck second term, it could very well pave the way for Hillary in '08 with an American version of the European cradle-to-grave socialism now in place in those countries.
No it won't. Never has. We had a little dance with that in the early '70's when people were inconvenience by having to wait in line for gas. Now THAT set some people off. It wasn't the price that pissed them off it was the lines. You're from somewhere like California with 2.00$ a gallon gas aren't you? I hope you understand that almost 40% of you gas dollar goes to extroadinary regulation by California. Do you know that California must use separate pipelines from the rest of the world because of the difference in fuel construction? And Californians wonder why Enron peeled their skulls back.
Generally, for the coolest, newest technology, my experience has been that you find it first in Akihabara (Tokyo's "Electric Town"), not in the U.S. However, it isn't usually all that cheap, unlike the versions that eventually show up in the U.S.
You clearly don't understand business. One of those "smart Indians" could be paid a salary equal to the old CEO and they still wouldn't be able to do the job -- you apparently don't understand what it is they actually do for the company. CEOs aren't really hired for their intelligence or arguably even their vision, and for better or worse, many of those CEOs who command 8-figure salaries and such give better than that in ROI. Not all of them, but many of them.
We've hired top-shelf MegaCorp CEOs to run companies that I've built. Worth every penny more often than not. At the end of the day a business is all about ROI because without it you have no business, and the more assets you can bring into the picture with positive ROI for the company (be it quality CEOs, IP, or whatever) the better it is for the company.
Aside from all this, the outsourcing bogeyman is greatly overblown. Only very small portions of high-tech business can be outsourced with any benefit, and the industry has a lot of experience with it to know what works and what doesn't. Things will no more be outsourced now than they were ten years ago. It is just a current fixation in the media. Most of the jobs that were outsourced have been being outsourced for ages and are the crappy jobs in high-tech. The good (and high-paying) jobs aren't going anywhere.
I remember back in the 70s it was MITI who was going to take over the world.
Weak argument. MITI only proves my point. MITI supercharged Japans economy for 2 decades +. It was only when they went to a floating yen and freed some trade barriers that they lost their momentum.
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