26 April 2005

A state of denial exists among policymakers and outsourcing’s corporate champions about the adverse effects

Outsourcing is a greater threat than terrorism.
In what might be an underestimate, a University of California study concludes that 14 million white-collar jobs are vulnerable to being outsourced offshore. These are not only call-center operators, customer service and back-office jobs, but also information technology, accounting, architecture, advanced engineering design, news reporting, stock analysis, and medical and legal services.

The authors note that these are the jobs of the American Dream, the jobs of upward mobility that generate the bulk of the tax revenues that fund our education, health, infrastructure, and social security systems.

The loss of these jobs "is fool’s gold for companies." Corporate America’s short-term mentality, stemming from bonuses tied to quarterly results, is causing US companies to lose not only their best employees—their human capital—but also the consumers who buy their products.

Employees displaced by foreigners and left unemployed or in lower paid work have a reduced presence in the consumer market. They provide fewer retirement savings for new investment.

17 April 2005

The economic tsunami planned by the Bush administration is probably only months away

In just 5 short years the national debt has increased by nearly 3 trillion dollars while the dollar has fallen a whopping 38%.
The Bush administration is mainly comprised of internationalists. That doesn't mean that they "hate America"; simply that they are committed to bringing America into line with the "new world order" and an economic regime that has been approved by corporate and financial elites alike. Their patriotism extends no further than the garish tri-colored flag on their lapel. The catastrophe that middle class Americans face is what these elites breezily refer to as "shock therapy"; a sudden jolt, followed by fundamental changes to the system. In the near future we can expect tax reform, fiscal discipline, deregulation, free capital flows, lowered tariffs, reduced public services, and privatization. In other words, a society entirely designed to service the needs of corporations.

There are a number of signs that the economy is close to meltdown-stage. Even with cheap energy, low interest rates and $450 billion in borrowed revenue pumped into the system each year, the economy is still barely treading water. This has a lot to due with the colossal shifting of wealth brought on by the tax cuts. Supply-side, trickle-down theories have been widely discredited and Bush's tax cuts have done nothing to stimulate the economy as promised. Now, with oil tilting towards $60 per barrel, the economic landscape is changing quickly, and shock-waves are already being felt throughout the country.

The Iraq war has contributed considerably to our current dilemma. The conflict has taken nearly one million barrels of Iraqi oil per day off line.(The exact amount that the administration is trying to replace by pressuring OPEC) In other words, the astronomical prices at the pump are the direct result of Bush's war. The media has failed to report on the negative affects the war has had on oil production, just as they have obscured the incredibly successful insurgent strategy of destroying pipelines. This isn't a storyline that plays well to the American public, who expected that Iraq would be paying for its own reconstruction by now. Instead, the resistance is striking back at the empire's Achilles heel (America's need for massive amounts of cheap oil) and its having a damaging affect on the US economy.

12 April 2005

The real culprit behind these higher oil prices is the Bush Administration

Thanks to massive deficits, and tax give-aways to the rich and corporations, to its war spending, and to its failure to combat unpredecedented and even larger trade deficits.
Increasingly, concern is being expressed by treasury officials and economists about the negative impact soaring oil prices and related gas prices could have on the overall economy. Politicians-especially Republicans-- are also fretting, since the thousands of extra dollars consumers are now spending on electricity, home heating and gasoline have, for all but the wealthiest taxpayers, more than cancelled out any minimal benefits they saw from the president's tax cuts.

Oil is a commodity and it is priced in dollars. If dollars decline in value, then the price of oil will rise in inverse proportion.

nd this situation is likely to get only worse. Some Wall Street oil industry analysts are now predicting that oil could, before too long, hit $100 a barrel. What they are saying really is that the dollar is likely to fall in value by 50 percent.

Adjusted for inflation, gasoline prices are still a far cry from the peak price paid in 1981. Nevertheless, demand for gasoline is highly inelastic, and thus more money out of the family budget is earmarked for fillup time. And compounding the matter, worker wages are not keeping pace with prices.

For the first time in 14 years, the American workforce has in effect gotten an across-the-board pay cut.

The growth in wages in 2004 and the first two months of this year trailed inflation, compounding the squeeze from higher housing, energy and other costs.

Meanwhile, corporate profits hit record highs as companies got more productivity out of workers while keeping pay increases down.

All this means less money for eating out, hobbies, vacations, which in turn snowballs into woes for small business, retailers and any purveyors of goods and services.

8 April 2005

We can take our ship anywhere we want

Forget outsourcing, these enterprising minds are planning a slave ship for computer programmers, parked in international waters, to avoid dealing with immigration visa issues.
Take a used cruise ship, plant it in international waters three miles off the coast of El Segundo, near Los Angeles, people it with 600 of the brightest software engineers they can find around the world (both men and women), and run a 24-hour-a-day programming shop, thereby avoiding H-1B visa hassles while still exploiting offshore labor cost arbitrage and completing development projects in half the time they’d take onshore or offshore.

“As more people have run the [offshore] gauntlet and found the joys of traveling to India coach class and having three weeks of stuff on their desk when they come back, [they discover] it’s much more disruptive than they ever imagined it would be,” explains Mr. Green.

Naturally, most of the "hires" will be from India. A prison boat, floating off the coast of California to supplant American professional workers.

5 April 2005

A country that permits its manufacturing and its technical and scientific professions to wither away is a country on a path to the Third World

Former Reagan administration staffer Paul Craig Roberts takes another monthly view of the Bureau of Labor Statistics (BLS) numbers and it's not good news, at least for the American worker, or for our nation's economic future.
In March the US economy created a paltry 111,000 private sector jobs, half the expected amount. Following a well-established pattern, US job growth was concentrated in domestic services: waitresses and bartenders, construction, administrative and waste services, and health care and social assistance.

In the 21st century the US economy has ceased to create jobs in knowledge industries or information technology (IT). It has been a long time since any jobs were created in export and import-competitive sectors.

The Bureau of Labor Statistics forecasts no change in the new pattern of US payroll job growth. Outsourcing and offshore production have reduced the need for American engineers, scientists, designers, accountants, stock analysts, and other professional skills.  A college degree is no longer a ticket to upward mobility for Americans.

Nandan Nilekani is CEO of Infosys, an Indian software development firm.  In an interview with New Scientist, he noted that outsourcing is causing American students to "stop studying technical subjects. They are already becoming wary of going into a field which will be ‘Bangalored’ tomorrow."

4 April 2005

Workers in the United States have been taking a beating for the past thirty years

With the exception of the period from 1995 to 2000, the best compendium and analysis of U.S. labor market statistics tell us that workers have fared poorly in recent times. The affect of unemployment rate, unions, and disparity of income between rich and poor are also examined. Also, the myth that we're entering a period where high skill be necessary for most jobs is debunked:
Nearly 30 million persons labor as teaching assistants, food preparers and servers, counter attendants, cashiers, counter and rental clerks, bookkeepers, customer service reps, stock clerks and order fillers, secretaries, general office clerks, assemblers, sorters, helpers, truck drivers, packers and packagers, and laborers. The Bureau of Labor Statistics estimates that the ten occupations with the largest job growth between 2000 and 2010 will be food preparation and service workers, customer service representatives, registered nurses, retail salespersons, computer support specialists, cashiers, general office clerks, security guards, computer software engineers, and waiters and waitresses. Of these, nurses and software engineers are the only obviously “good” jobs, and even these are rapidly being rationalized or outsourced by cost-conscious managers.

Oh, the IT worker, that's all a bunch of nonsense

Writer/NY Times columnist Thomas Friedman flaunts his ignorance once again.
Show me a qualified software engineer today anywhere in America who is looking for a job and can't find one. Some of them may have had to move a little horizontally. But show me one person who really has qualifications, is an IT knowledge worker, and just cannot find a job. I don't believe that.

I am a qualified software engineer today, with a college degree in Computer Science, in America who is looking for a job and thus far, unable to secure one. I am fluent in a range of computer languages from the mainframe dinosaur likes of COBOL, CLIST, to the modern dialects of C, Java, Perl, PHP, Python, HTML. Experienced in network communications and relational databases.

And I am not alone, many of my colleagues and peers have been affected by the new model of outsourcing and the importing of non immigrant visa workers. Within a few minutes drive of my house, I tally thousands of jobs lost to outsourcing or supplanted by non immigrant visa workers who have replaced American engineers and programmers. I know this from firsthand experience, because I've had to train my offshore replacements.

I don't believe I am "entitled to a job". I do think that targeting an entire profession for extinction is a grave mistake. Then some foolishly wonder why our youth choose not to pursue careers in computer science or engineering. Duh, it's not a difficult riddle — lowered earnings prospects and career duration variablility due to this phenomenon have most definitely pushed prospective students away.

It is astonishing to read and listen to those who advocate the full scale shredding of an occupation, while not considering that if all fields (and just about all jobs potentially could fit into this new paradigm, even if they can't be moved offshored, a job certainly can be manned by a guest worker immigrant, willing to work for less or agreeable to lesser work conditions due to the non-competitive arrangement they will work under).