Jeremy wrote:
] According to the election-year bluster of politicians and
] pundits, the outsourcing of American jobs to other countries
] has become a problem of epic proportion.
]
] Fortunately, this alarmism is misguided.
]
] Outsourcing actually brings far more benefits than costs, both
] now and in the long run. If its critics succeed in provoking a
] new wave of American protectionism, the consequences will be
] disastrous -- for the U.S. economy and for the American
] workers they claim to defend.
]
]
] This article appears in the May/June 2004 issue of Foreign
] Affairs.

Drezner pinpoints why there is such a strong backlash:

When it comes to trade policy, there are two iron laws of politics. The first is that the benefits of trade diffuse across the economy, but the costs of trade are concentrated.

Jeremy wrote:
] According to the election-year bluster of politicians and
] pundits, the outsourcing of American jobs to other countries
] has become a problem of epic proportion.
]
] Fortunately, this alarmism is misguided.

This article brought to mind the famous observation that "there are lies, there are damn lies, and then there are statistics."

You see, I understand the value of offshore outsourcing. I honestly think its a great idea. However, there is a REAL problem with employment in the IT/Engineering industry. Its not a misguided "perception." People aren't confused. I have yet to find one single commentator who is willing to directly tackle the problem in the course of defending offshoring. I had high hopes for an article published in such an esteemed journal, but no, unfortunately this author pretends to address the issue by dancing around it with misleading statistics, and incorrect accusations (such as the whopper that everyone is comparing present employment figures with 2000).

So if we're going to play the statistics game, let me throw one into the ring:

"Offshoring, or the outsourcing of high-wage jobs from the United States to
lower-wage countries, is contributing to unprecedented unemployment rates
for U.S. electrical and electronics engineers (EEs) and other information
technology professionals. The EE joblessness rate rose by 47.6 percent in
2003 to a record 6.2 percent, compared to 4.2 percent in 2002. The 2003
unemployment rate for computer scientists and systems analysts reached an
all-time high of 5.2 percent." - IEEE-USA

If you cannot take this on directly and discuss the implications of it in the face of offshoring, then you cannot defend offshoring. By refusing to address this issue directly commentators are doing themselves a disservice. You cannot convince someone who is unemployed that there is no jobs problem. By claiming that the problem doesn't exist you are arguing that the world is square. You're going to loose every time.

Decius wrote:
] You see, I understand the value of offshore outsourcing.
] I honestly think it's a great idea. However, there is a
] REAL problem with employment in the IT/Engineering industry.
]
] If you cannot take this on directly and discuss the
] implications of it in the face of offshoring, then you
] cannot defend offshoring.

To paraphrase Homer Simpson: "Statistics. Is there anything they can't do?"

You appear to be refuting the thesis of the article on the basis of an exception in a specific industry. I do not believe your argument (that a real problem exists in IT/EE) is incompatible with Drezner's overall assessment that offshore outsourcing does not affect most jobs.

A point that Drezner raises in his article, and that you do not directly address in your response, is that employment trends have as much to do with the large-scale structural shifts brought about by technological development as with the labor policies of big business.

As I've stated before, my view is that the source of the problem, as well as the solution, is education. The boom years produced a pool of 'engineering' and 'computer science' 'professionals' who viewed the learning process as one of accumulating a collection of key facts and demonstrating an ability to regurgitate them on cue. (By no means does that imply everyone is in that pool. EE/CS readers should not reflexively take offense. But if the shoe fits ...)

Just as Bruce Schneier says about security: engineering is a process, not a product. Going forward, "IT/Engineering" must be part of the service sector, not the manufacturing sector. Evidence of the problem can be found in the simple fact that people are still referring to it as an Industry.

Despite the stigma of statistics, I would be interested in seeing some data that shows the unemployment rate as a function of grade point average in college, both overall and by industry/specialty.

Jeremy wrote:
] To paraphrase Homer Simpson: "Statistics. Is there anything they can't do?"

Show truth before its too late to do anything with it but look and go, "ahhhh!"

] Despite the stigma of statistics, I would be interested in
] seeing some data that shows the unemployment rate as a
] function of grade point average in college, both overall and
] by industry/specialty.

As would I. I didn't exactly have the greatest GPA when I was in kolledge, mostly due to the massive slide in my grades that occurred once building Skyfire started. From what I've read elsewhere, the dropout and school return rates among the entrepreneur crowd both tend to be high. Things like learning disabilities are hard to take into account too.

Jeremy wrote:
] You appear to be refuting the thesis of the article on the
] basis of an exception in a specific industry. I do not
] believe your argument (that a real problem exists in IT/EE) is
] incompatible with Drezner's overall assessment that offshore
] outsourcing does not affect most jobs.

I'm not sure I buy the idea that 90% of jobs cannot be offshored, but no I'm not specifically disputing that here.

Since you asked...
People basically need:
1. Things.
2. Information/Entertainment.
3. Healthcare.
4. Security.

Everything else is related to one of those four categories. You can outsource all of 1 with the exception of buildings/realestate and infrastructure like sewer systems, and all of 2, although the "art" piece is likely to remain here for a while. Seems like more the 90% of what people do. But what do I know?

] A point that Drezner raises in his article, and that you do
] not directly address in your response, is that employment
] trends have as much to do with the large-scale structural
] shifts brought about by technological development as with the
] labor policies of big business.

I don't dispute that there are other factors. Offshoring did not create the current environment. Offshoring is being used to prolong it. As the economy takes off companies in the tech industry are hiring in Asia to increase capacity instead of hiring in the United States. Over the long term this poses a threat to the idea that the US is a technology leader. Thats the whole reason for this debate. No new R&D is being done in the U.S. Its all being done in India. That is the fundamental subject at hand when "offshoring" is being discussed. This author, like everyone else on his side of the table that I have yet read, argues that we're not really moving R&D offshore. He is wrong about that, as a matter of fact, and this discussion cannot proceed until we're all on the same page with that.

] As I've stated before, my view is that the source of the
] problem, as well as the solution, is education.

I don't agree with this. We're not offshoring jobs because the people over there are smarter. We had that problem in 2000. Its a skills mismatch and what it looks like is monster.com is overflowing with job opportunities while there is a slew of people who can't seem to find work. Meanwhile we're sending stuff overseas and bringing people in from overseas. An education problem is apparent when you have too many jobs and you can't find the right people to fill them. We have the opposite problem. We have too many people and we don't have jobs for them.

We're exporting jobs because the people over there are just as smart, but also cheaper.

Domestically, the problem is that we have a lot of smart people with nothing to do. Producing more smart people, or smarter people, isn't going to solve the problem, its going to exacerbate it. You're increasing the supply of things you already have too much of.

You cannot increase the price of apples by making more apples.

Of course, the markets work their magic quite accurately. We're not training more science/engineering people. We're training less. Enrollments in university Computer Science programs are down 15% this year from last year. I'm not talking about ITT tech or the local Cisco Certification factory here. I'm talking about MIT/Stanford/Berkeley...

Decius wrote:
] If you cannot take this on directly and discuss the
] implications of it in the face of offshoring, then you cannot
] defend offshoring. By refusing to address this issue directly
] commentators are doing themselves a disservice. You cannot
] convince someone who is unemployed that there is no jobs
] problem. By claiming that the problem does exist you are
] arguing that the world is square. You're going to loose every
] time.

[ Or maybe you're arguing that the world is round, but either way, your point is correct... the issue of joblessness must be addressed, and the benefits of offshoring proven, not presumed. -k]