Outsourcing Our Nation

English 101

11 March 2004

As the 2004 Presidential election draws near, questions pertaining to the mission to Mars, elusive weapons of mass destruction, and fallacies concerning military service swarm around the candidates. However, as many of us know, a candidate’s campaign lives or dies depending on his plan for the economy. This year a new economic challenge has arose. All other issues have been smothered by the cries of nearly two million factory, mill, and information technology workers. Because of outsourcing, the question tipping everyone’s tongue is “Where did my job go?”

Also referred to as offshoring, outsourcing is the practice of subcontracting manufacturing work to outside and especially foreign or non-union companies. Based on the economic practice of comparative advantage–country X producing a good or service at a lower opportunity cost than country Y, United States corporations find cheap labor in countries such as India and the Philippines (Buchanan). With belief in President George W. Bush’s repeated promise of job creation fading fast, unemployed workers across the nation have agreed: The United States government should take an active role in protecting their jobs from outsourcing.

With the creation of technological advances, including new ways to conduct business and trade, a problem has been created. The United States is currently consuming more than it is producing in goods and services by a margin of a million dollars a minute (Nash 15). For

decades, the world has been a large source of goods and energy for the United States; however, international labor has come to be relied upon as well (Dobbs 40). Through outsourcing, companies have been able to obtain large amounts of inexpensive labor at the cost of laying off two million Americans. Displacement from outsourcing has affected factory workers most severely. In the 60\'s and 70\'s, “blue collar workers could earn white-collar incomes. Organized into powerful unions, industrial workers secured regular wage increases and improved benefit packages” (Lindstrom). Now in 2004, industrial work has become increasingly outsourced. Beginning in the 1980\'s, Mexican maquiladoras (mills) were popular because of their outsourcing potential. Because a good produced by low wage workers is less expensive than a good produced by unionized workers, these imported goods prevent domestic producers from staying competitive (Nash 15). Even further crippling domestic industries, since the United States lifted quotas on Chinese exports, textile industries have been forced to lay off 37,000 workers (Forney 42).

At first only affecting blue collar workers across the nation, the real spark of the heated political issue is the extreme loss of white-collar jobs as well (Will). The 1990\'s was a decade of herding workers to the field of technology. It was “easy street” for those who could quickly learn the programmers’ lingo or how to manage corporate computer networks. But for programmers like Vince Kosmac of Orlando, Florida, there was no salvation in technology. Vince is among thousands of programmers and information technology (IT) workers who have lost their jobs to outsourcing (Thottam 31).

Though IT services outsourced account for less than 1/20th of one percent of gross domestic production, this is sure to be a growing trend. Since 2000, United States businesses have spread information technology jobs to countries like India, China, Ireland, Israel, and the Phillippines (Gongloff). When calling Dell for quick help on a malfunctioning PC, the customer service representative answering all of your questions is most likely an outsourced IT worker in Bangalore or New Delhi (Thottam 36).

1930\'s legislation increased domestic working conditions, wages, and workers rights for Americans. However, in the 1990\'s, the roar for better conditions for outsourced workers in developing countries challenged companies like Disney, Levi Strauss, Liz Clairborne, Mattel, Nike, and Reebok (Vogel). Now in 2004, working conditions have improved, but there is little increase in wages as well. The average salary for a software programmer in the United States is $66,100. The average salary for an Indian software programmer is $10,000 (Thottam 39). For an American project manager, yearly income is between $13,600-$17,100. For a Filipino project manager, yearly income is roughly $700-1,150 (Gongloff). The differences in salaries are beyond substantial, they are enormous. But businesses barely blink an eye as their profits continue to grow.

Many companies are claiming that the mass amount of outsourced labor is due