Who's in and who's out

Every once in a while, a new word enters the popular American lexicon and enjoys its richly—deserved 15 minutes of fame, before receding into the dark recesses of the public consciousness, never to make an appearance again. We are fortunate to be graced with just such a word now: Outsourcing.

Outsourcing refers, of course, to the exporting of American jobs to overseas workers, with the strong negative implication that somehow, foreign workers are 'stealing' good jobs from the US (or worse yet, evil Big Corporations are doing it on purpose, with the full blessings of the Bush administration), hurting our economy and the average Joe.

The entire subject of outsourcing has certainly received a lot of publicity lately, mostly because it's been picked up as an opportunistic political talking point by Democratic demagogues looking to score some quick points with the barely aware American electorate. There's certainly nothing wrong with politicians trying to make a dramatic splash on an emotionally—charged issue during an election year. It's the American way, and more often than not, the public will filter out most of the nonsense on their own.

But, as always, the quick sound bite on TV and the reality are two entirely different things. Consider the following:

Outsourcing is nothing new. It's been going on for decades, and it's a natural occurrence in any living, dynamic economy. At some point, it's just not economically feasible for companies to do certain things here at top dollar. Shoes, sneakers, TV sets, toys, light fixtures, etc. are now 'outsourced' to foreign factories at a fraction of the cost. This is certainly nothing new. The American consumer—you—derive the benefit of these lower—cost goods and services, and thus have more money to spend on other things.

What IS new is that the latest industries to do this are highly visible—such as the IT and insurance industries. Many customer support and software programming functions are now handled in India instead of being done domestically. This recent development has been pounced on as an example of the current administration's callous attitude towards the struggle of the American worker.

In fact, the 200K jobs outsourced to India represent just a small fraction of the 10 million people employed here in the US IT industry. Shedding high—cost, low skill jobs enables companies to remain competitive in a competitive world, and retain or INCREASE their domestic labor force. GE argues that its overseas expansion 'has helped keep GE competitive and growing, and, in many cases, helped to create and preserve jobs in the United States.'

But the other side of this story that never seems to make its way through the haze of political rhetoric and media bias is the fact that positive effects of IN—sourcing have more than offset any negative consequences of outsourcing. Think of the foreign companies that have manufacturing, sales, and service operations here in the US: Toyota, Honda, Nissan, BMW, and Mercedes all manufacture cars here using American workers. Sony, Panasonic, Hitachi, Toshiba, Samsung all have tremendous sales and service organizations here. There are dozens upon dozens of other examples. In all, a very significant 6.4 million US workers (out of a highest—in—history 130 million paid U.S. work force) are employed by foreign companies as a result of insourcing. That's 5%, which means 1 OUT OF EVERY 20 workers here in the US is an insourced worker. Funny, you never seem to hear John Kerry mention that side of the story. And you never seem to hear Peter Jennings or NPR bring it up either. They pretend to get all hot and bothered about outsourcing, but they never present the entire picture.

That's unfortunate. Most peoples' attention spans today are so short that they can only comprehend the simplest, shortest bits of serious information. And those simple, quick bits are usually incomplete and therefore dangerously misleading. The quick—hit artists, like Kerry, count on this so they can score a fast goal or two before their audience tires and changes the channel.

Every once in a while, a new word enters the popular American lexicon and enjoys its richly—deserved 15 minutes of fame, before receding into the dark recesses of the public consciousness, never to make an appearance again. We are fortunate to be graced with just such a word now: Outsourcing.

Outsourcing refers, of course, to the exporting of American jobs to overseas workers, with the strong negative implication that somehow, foreign workers are 'stealing' good jobs from the US (or worse yet, evil Big Corporations are doing it on purpose, with the full blessings of the Bush administration), hurting our economy and the average Joe.

The entire subject of outsourcing has certainly received a lot of publicity lately, mostly because it's been picked up as an opportunistic political talking point by Democratic demagogues looking to score some quick points with the barely aware American electorate. There's certainly nothing wrong with politicians trying to make a dramatic splash on an emotionally—charged issue during an election year. It's the American way, and more often than not, the public will filter out most of the nonsense on their own.

But, as always, the quick sound bite on TV and the reality are two entirely different things. Consider the following:

Outsourcing is nothing new. It's been going on for decades, and it's a natural occurrence in any living, dynamic economy. At some point, it's just not economically feasible for companies to do certain things here at top dollar. Shoes, sneakers, TV sets, toys, light fixtures, etc. are now 'outsourced' to foreign factories at a fraction of the cost. This is certainly nothing new. The American consumer—you—derive the benefit of these lower—cost goods and services, and thus have more money to spend on other things.

What IS new is that the latest industries to do this are highly visible—such as the IT and insurance industries. Many customer support and software programming functions are now handled in India instead of being done domestically. This recent development has been pounced on as an example of the current administration's callous attitude towards the struggle of the American worker.

In fact, the 200K jobs outsourced to India represent just a small fraction of the 10 million people employed here in the US IT industry. Shedding high—cost, low skill jobs enables companies to remain competitive in a competitive world, and retain or INCREASE their domestic labor force. GE argues that its overseas expansion 'has helped keep GE competitive and growing, and, in many cases, helped to create and preserve jobs in the United States.'

But the other side of this story that never seems to make its way through the haze of political rhetoric and media bias is the fact that positive effects of IN—sourcing have more than offset any negative consequences of outsourcing. Think of the foreign companies that have manufacturing, sales, and service operations here in the US: Toyota, Honda, Nissan, BMW, and Mercedes all manufacture cars here using American workers. Sony, Panasonic, Hitachi, Toshiba, Samsung all have tremendous sales and service organizations here. There are dozens upon dozens of other examples. In all, a very significant 6.4 million US workers (out of a highest—in—history 130 million paid U.S. work force) are employed by foreign companies as a result of insourcing. That's 5%, which means 1 OUT OF EVERY 20 workers here in the US is an insourced worker. Funny, you never seem to hear John Kerry mention that side of the story. And you never seem to hear Peter Jennings or NPR bring it up either. They pretend to get all hot and bothered about outsourcing, but they never present the entire picture.

That's unfortunate. Most peoples' attention spans today are so short that they can only comprehend the simplest, shortest bits of serious information. And those simple, quick bits are usually incomplete and therefore dangerously misleading. The quick—hit artists, like Kerry, count on this so they can score a fast goal or two before their audience tires and changes the channel.