Many of the emerging markets are not only a source of labor and a good place to outsource, but they're becoming a market were this companies want to sell their products too. The best example of this is China, it's a market that buys in huge numbers and those numbers grow every year [and they grow at a faster pace than developed nations]. If the US enforces protectionism, either at the labor market and at the capital market level, it'll make it's companies less competitive when trying to sell abroad. In the long run it would hurt US companies, they would lose leadership and that would bring much bigger problems to the US than outsourcing can ever bring. It was protectionism in the labor market that made outsourcing such a good business in the first place.
You keep repeating yourself, and spew hollow rhetoric from economists who have been refuted many times. You come off sounding like a career academic who has never been in the real world. Japan has LOTS of tariffs. This country has been trying to break into their markets for decades. Funny thing, Japan is the per capita RICHEST country in the world, with a fantastically low unemployment rate. They are the leader in technological innovations. They only export manufacturing, they aren't stupid or greedy enough to destroy their country by outsourcing their middle class. The problem in America is that Americans don't seem to give a crap if they destroy their country. As long as they make a buck, screw everyone else. As someone pointed out, once China doesn't depend on USA for exports anymore, they plan to put export tariffs on foreign firms. There goes your free trade argument, right out the window. America is getting screwed. Only the ultrarich benefit from this. And why should Americans give a flying f*ck if Chinese have jobs.
. February 2, 2008 SouthAmerica: Quoting from the article: âBlinder warns the pain may just be starting. He estimates that eventually up to 40 million service jobs in the U.S. could face competition from workers in India and other low-wage nations. That's more than a quarter of the 140 million employed in the U.S. today. Many of the newly vulnerable will be in skilled fields, such as accounting or researchâjobs U.S. companies will be able to move offshore in ever greater numbers. "It will be a messy process of adjustment, with a lot of victims along the way," Blinder says.â ********* Business Week â February 11, 2008 âEconomists Rethink Free Tradeâ It's no wholesale repudiation, to be sure, but something momentous is happening as doubts begin to creep in By Jane Sasseen Many ordinary Americans have long been suspicious of free trade, seeing it as a destroyer of good-paying jobs. American economists, though, have told a different story. For them, free trade has been the great unmitigated good, the force that drives a country to shed unproductive industries, focus on what it does best, and create new, higher-skilled jobs that offer better pay than those that are lost. This support of free trade by the academic Establishment is a big reason why Presidents, be they Democrat or Republican, have for years pursued a free-trade agenda. The experts they consult have always told them that free trade was the best route to ever higher living standards. But something momentous is happening inside the church of free trade: Doubts are creeping in. We're not talking wholesale, dramatic repudiation of the theory. Economists are, however, noting that their ideas can't explain the disturbing stagnation in income that much of the middle class is experiencing. They also fear a protectionist backlash unless more is done to help those who are losing out. "Previously, you just had extremists making extravagant claims against trade," says Gary C. Hufbauer, a senior fellow at the Peterson Institute for International Economics. "Now there are broader questions being raised that would not have been asked 10 or 15 years ago." So the next President may be consulting on trade with experts who feel a lot less confident of the old certainties than they did just a few years ago. From Alan S. Blinder, a former vice-chairman of the Federal Reserve and member of the Council of Economic Advisers in the Clinton Administration, to Dartmouth's Matthew J. Slaughter, an international economist who served on President George W. Bush's CEA, many in the profession are reevaluating the impact of globalization. They have studied the growth of low-wage work abroad and seen how high-speed telecommunications make it possible to handle more jobs offshore. Now they fear these factors are more menacing than they first thought. GAINS ONLY FOR A TINY SLICE No one is suggesting that trade is bad for the U.S. overall. According to estimates by the Peterson Institute and others, trade and investment liberalization over the past decades have added $500 billion to $1 trillion to annual income in the U.S. Yet concern is rising that the gains from free trade may increasingly be going to a small group at the top. For the vast majority of Americans, Dartmouth's Slaughter points out, income growth has all but disappeared in recent years. And it's not just the low-skilled who are getting slammed. Inflation-adjusted earnings have fallen in every educational category other than the 4% who hold doctorates or professional degrees. Such numbers, Slaughter argues, suggest the share of Americans who aren't included in the gains from trade may be very big. "[That's] a very important change from earlier generations, and it should give pause to people who say they know what's going on," he says. Blinder warns the pain may just be starting. He estimates that eventually up to 40 million service jobs in the U.S. could face competition from workers in India and other low-wage nations. That's more than a quarter of the 140 million employed in the U.S. today. Many of the newly vulnerable will be in skilled fields, such as accounting or researchâjobs U.S. companies will be able to move offshore in ever greater numbers. "It will be a messy process of adjustment, with a lot of victims along the way," Blinder says. The rumble of academic debate is already having an effect on the Presidential campaign. In an interview with the Financial Times late last year, Hillary Clinton agreed with economist Paul A. Samuelson's argument that traditional notions of comparative advantage may no longer apply. "The question of whether spreading globalization and information technology are strengthening or hollowing out our middle class may be the most paramount economic issue of our time," her chief economic adviser, Gene Sperling, recently wrote. Barack Obama's adviser, the University of Chicago's Austan D. Goolsbee, is not convinced free trade is the culprit behind the squeeze on incomes. But he believes many U.S. workers aren't sharing in the gains from open markets and fears a political blowback unless something is done. A CALL TO ACTION What to do? Blinder argues for a big expansion of unemployment insurance and a major overhaul of the poorly performing Trade Adjustment Assistance program (TAA), which retrains manufacturing workers whose jobs disappeared. More vocational training and wage insurance, which would partially reimburse displaced workers who take new jobs at lower pay, also figure in his proposals. Both Clinton and Obamaâand even Republican Senator John McCainâhave similar ideas. That's not enough, says Slaughter. He sees a need for some form of income redistribution to spread the gains from free trade to more workers. In a controversial article Slaughter co-wrote last summer for Foreign Affairs, he proposed "A New Deal for Globalization" in which payroll taxes for all workers earning below the national median income level would be eliminated. Slaughter has talked with campaign advisers in both parties. So far, he has no takers. But it's one more sign of how far the trade debate has moved. Sasseen is Washington bureau chief for BusinessWeek. Source: http://www.businessweek.com/magazin...l_news&chan=top+news_top+news+index_investing .
To limit the outsource of services is going to become a much harder task as the internet evolves and broadband becomes available in most of the third world.
God what a bunch of whiners ... Protectionism is bad. The american public somehow doesnt seem to understand it nowadays. Since when is America the land of the weak? What made this country great was people who never gave up. I remember people of this country getting around road blocks again and again. New industries have been invented in this country because people of this country didnt believe in giving up. (Case in point, the computer/software industry) I agree with someone else who posted that creative jobs will never get outsourced. They cant as creative work is expensive and as long as you have a niche, you can charge whatever you want for it. I also find it dissappointing that everyone who has lost a job blames the greedy CEO. Well the America that I knew would build a competing business or replace the CEO ... Or is that just a dream now as all I hear is everyone complaining how some took their job away ... PS: If I was to get fired tommorow, I can think of 5 different things which I start and thrive in. It wont be easy but I didnt get this far in life by taking the easy road ...
Don't get the wrong idea. I'm not "whining". I made 6 times more than my BEST year working last year, and it wasn't my best year investing/trading, either. I have adjusted and adapted from IT wiz by necessity to investor/trader, and unlike many folks, I have no difficulty taking on anything interesting if I can make a good buck at it. In order to expect to be paid, anyone in a job should expect to need to produce significant enough results that the company makes good profit for taking the risk of having them as employees. I guess it just bugs me that the same people that will BEG you to come in at 3 am or work 30 hrs straight to bail them out are so quick to have you train or babysit your replacement from India. What he missed there was that it isn't just IT jobs moving overseas, and as competitive cost pressures increase, more and more functions and departments will see their ranks decimated or annihilated by the shift, until there is nothing left here but the brand name and the top level corporate staff. And thus we become less focused on "labor or employees" and more focused on "return on capital". The focus has changed to where the ex IT guys like myself, as investors and shareholders, now demand profit levels that might cost his job next. There is no way to limit the outsourcing except by survival of the fittest, IMO.
I own a medical staffing firm and have hired 40 contractors over the past 4 months, all Americans. Not one of them has acquired any clients. Thank goodness they are on commission with no salary, so I lost nothing. I acquire about 3 new clients/week. My guess is that most Americans are just lazy and expect a free handout. Several of them ask me for my list of clients. If they think I'll just hand over my list of clients to them on a silver platter, they are living in fantasy land. If I wanted to find hard workers that are loyal and would work for less, I bet I can find them in India or China.
there is a 'life n death' mentality in South Asian schools, the poorest kids have a chance to compete with the richest kids, though the rich kids are almost guaranteed positions through family bribes... this is in stark constrast, to american high schools, where the news of the day will be Britney's escapades.. when your family sacrifices life n limb to send you to school, they expect you to perform and not choose dead n fields to specialize in...as a good percentage of the american kids do. so the asian kids are competing for life the ability to raise their family out of poverty... the darwinian dynamics are hard to ignore.