Surprise, surprise. The AP has just put out a puff piece for the software industry touting the supposedly benificent effects of outsourcing on the global economy. As an op-ed it might be acceptable. It is, however, treated as a hard news story, despite the fact that not a single economist, labor leader, or economic or labor historian is consulted. Write the AP and let them know what you think : feedback@ap.org
Here's the piece and my response (not in that order) :
Folks,
I was nothing short of stunned and appalled to find the attached article, which is nothing short of a propaganda piece for the software industry, treated as a hard news story. At the very least, it should have been published as an op-ed, or economists, union officials, and economic and labor historians with opposing views consulted. Indeed, for every neo-liberal "expert" who supports the notion that outsourcing is beneficial to the global economy, there is an economist or economic historian who believes otherwise. Indeed, every previous globalization in modern history, from Spanish-led globalization to Dutch-led globalization to the British-led globalization of the nineteenth and early twentieth century all ultimately failed as the result of a backlash within the country leading the charge. In each case, the country spearheading the push towards an integrated global economy outsourced or allowed to wither on the vine an ever greater percentage of its traditional industries and production capacity, became fixated on the notion that they could be a finance and services based economy, and that new industries would emerge indefinitely to replace job losses in traditional industries. This strategy worked for a time in all three examples, but ultimately failed, leaving a struggling middle and working class angry and resentful, and in the case of the United Dutch Provinces a violent political uprising ensued. In Britian it ultimately led to the dissolution of the liberal party, the creation of the socialist labor party, and major political and economic reforms. There is good reason that a similiar scenario will play out in America, and at the very least the AP should not have allowed such a one-sided story to be published as hard news.
Technology - AP
Experts: Outsourcing Helps World Economy
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By RAMOLA TALWAR BADAM, Associated Press Writer
BOMBAY, India - Outsourcing information technology-related jobs to developing countries such as India will boost competitiveness and slash costs, international software experts and government ministers said Tuesday.
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"We are not going to put up barriers to protect U.K. firms from tough competition from India," British Energy Minister Stephen Timms told some 900 delegates from India, Taiwan, Mauritius, the United States, Canada and Britain participating in a global high-tech conference.
"It's a great business opportunity for U.S. businesses because it makes IT available for a wide swathe of U.S. companies," said Dan Griswold, director of the Center for Trade Policy Studies at the Washington-based Cato Institute.
More jobs in developing countries would build "larger middle classes and create a larger market for U.S. products in the future," Griswold said.
Participants in the three-day conference, which began Tuesday, will discuss global economic growth from outsourcing, the impact of the high-tech industry on the global economy and immigration trends to developed countries.
"We know those Indian companies will benefit the U.K. economy and strengthen it," Timms said.
He also said two Indian information-technology companies, Tata Consultancy Services and Mastek, last week won a British government contract to improve the IT infrastructure of the National Health Service.
"A large part of the work on that contract will be outsourced to India," Timms said.
The British government recognized that Indian industry could "help us in our task of improving and modernizing our public health services," he said.
More than 450 Indian companies operate in Britain, which is India's second-largest trading partner after the United States.
However, Indian software companies have been battling a backlash from the United States and some other countries which fear India is stealing jobs.
India is the leader among several countries which develop software and handle back office work for foreign companies and government agencies at a fraction of the cost in developed countries.
The trend, called offshore outsourcing, has resulted in thousands of skilled jobs moving out of developed countries, including the United States and Britain, to India, the Philippines and other Asian nations.
The U.S. Senate on Jan. 22 passed a bill that would prohibit government contractors from shifting work overseas. Experts say the bill, which awaits presidential approval, would have little impact because less than 2 percent of India's US$10 billion annual software export revenue comes from government-related projects.
The conference in Bombay is organized by the National Association of Software and Service Companies, the Indian software and services export industry.