Tuesday, August 16, 2005

Off Point with Offshoring

Thousands of high quality, high paying, high tech American jobs have gone overseas in recent years, with no end in sight. Hyman’s solution? Stick your head in the sand and hope the problem goes away.

In his
recent commentary on the offshoring of American jobs, Hyman points out the costs associated for companies moving jobs overseas and suggests that the savings really aren't that great ( a mere ten percent).

Hyman cribs his statistics and ideas from Forrester Research, offering little of his own thought. (Hyman’s passivity in this commentary is in large measure responsible for this commentary’s 0.79 Hyman Index, the lowest on record.) His only contribution is to ask whether companies will consider offshoring jobs worth it given these hidden costs.

Well, yes they will, Mark. At least there’s little to indicate that this trend is going to stop anytime soon.

And if offshoring is acknowledged to be a problem (as Hyman seems willing to do), then perhaps we should look for some actual solutions rather than simply hoping that corporations will suddenly decide to give up a practice that’s saving them ten percent per exported job.

At a time when even voicing the slightest criticism of Bush administration foreign policy is seen as tantamount to treason, is it not unreasonable to suggest that the government take active steps to secure American jobs? If a news anchor reporting on the latest roadside bomb in Iraq is seen as “seeming to support the terrorists,” what are we to make of companies that ship American jobs overseas? Isn’t this a matter of our economic national security? (In fact, one author,
Ashutosh Sheshabalaya, has suggested that offshoring is contributing to the decline of America as a superpower and the rise of India in its place.)

Hyman is silent on this matter, but others aren’t. Jeffrey E. Garten, dean of the Yale School of Management, wrote an
op-ed for Business Week on what offshoring means for the American economy. Hardly a flaming liberal, Garten’s pragmatic analysis is that while it might be impossible (and unproductive) to try to save current jobs as they exist, we need policies that will help American workers more easily make the transitions that will certainly be forced on them. Among these are affordable and portable health coverage for all workers, secure and movable pensions, increased unemployment benefits, and tax breaks for education. Moreover, Garten notes that Washington needs to press for foreign countries to hold their industries to higher labor and environmental standards. All of these are, in Garten’s words, not luxuries, but necessary components to assure the long term economic health of the American workforce.

Of course, none of these things are being done by the Bush administration or being championed by Hyman. On the contrary, Bush has been aggressively anti-worker in his presidency, and has turned a blind eye to the treatment of workers and the environment by foreign companies (and American ones, too, for that matter) in the name of free trade.

Perhaps it’s a bit naïve to think that an executive at Sinclair Broadcasting would actively seek solutions to offshoring. After all, Sinclair has pioneered the domestic equivalent of “offshoring” by taking the local out of local news. How many hometown journalists have had their jobs “offshored” to Baltimore in the name of cutting costs?

On the other hand, maybe there’s a silver lining to this. Might Sinclair offshore just one more job? “The Point with Munindra Bhatia” has a nice ring to it.

And that’s The Counterpoint.

Hyman Index: 0.79


At 4:11 AM, Anonymous Anonymous said...

Regarding the book Rising Elephant, the entire final chapter is dedicated to what the US government and US workers need to do to cope with the Indian challenge. Unfortunately, the mainstream media has not given enough coverage to the book which does not banalize the problem (like Lou Dobbs), but puts it in a historical, economic and political context, and the frames and assesses the contours of possible solutions accordingly.



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