Business Technology: Outsourcing Debate Enters Political Arena - InformationWeek
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Bob Evans
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Business Technology: Outsourcing Debate Enters Political Arena

Well, it's official: The offshore-outsourcing debate has become political. Will this be a beneficial development for a white-hot topic that is already poorly understood and clouded on both sides by overly emotional perspectives?

First we'll hear from Democratic presidential candidate John Kerry, who last week sought to capitalize on the offshore issue by proposing to eliminate certain tax breaks for U.S. companies that move jobs overseas.

Kerry put it this way: "We're going to end the days when our government encourages big business to turn its back on America's workers. We need to end an administration that lets companies like Halliburton ship their old boss to the White House and get special treatment while they ship American jobs overseas." In a global economy where competitive standards are rapidly escalating, is this good policy? The question isn't rhetorical; also last week, candidate Joe Lieberman proposed that insurance companies shouldn't be allowed, by government fiat, to make more than 2% profit. Will these types of policies make U.S. companies more competitive in the 21st century, and thereby enable those companies to create more jobs, more opportunities, more upward mobility?

I feel the need to reiterate a position I've stated unequivocally over the past several months: that the hearts of all Americans go out to the tens of thousands of workers who've lost their jobs due to industry upheavals that have resulted in, among other things, offshore outsourcing. If protectionism would solve the problem and lead to things like "full employment," I'd be all for it. If government-mandated limits on what level of profit businesses can make would make those companies more competitive and successful and lead to higher employment, I'd bang the drum loudly. No matter how painful it is to see the impact on some American workers as the global economy unfolds, we cannot attempt to create a future that's a frozen image of a past that's just not compatible with today's round-the-clock, round-the-world economy.

Pushing against the proposed protectionist policies, a computer-industry trade group called the Computer Systems Policy Project last week trotted out Hewlett-Packard CEO Carly Fiorina and Intel CEO Craig Barrett to offer blunt talk on the repercussions that face this country as we evaluate these choices. (See Tech Companies Defend Moving U.S. Jobs Overseas, Jan. 7)

"There is no job that is America's God-given right," Fiorina said. "We have to compete for jobs." Echoing that perspective, Barrett said the United States has to face up to reality of global competition for high-tech employment. "It had been assumed we had a lock on white-collar jobs and high-tech jobs. That is no longer the case."

What's the right approach? Here are a couple of ideas: First, if Congress decides in this election year that this is just too juicy a plum to resist, then instead of trying to punish private enterprises for doing what's in their own self-interest, how about offering incentives to U.S. companies for retraining workers to fill jobs that otherwise would have gone to another country? Second, don't succumb to the prevailing myth that there's no employment future in technology in the United States--give incentives to universities and to students to marry the technical degrees they're pursuing with a business degree, or finance, or marketing, or operations, or a foreign language.

This country's future is incredibly bright as long as we rely on the drive, talent, and innovation of American workers and students and not on legislative barriers whose only doomed purpose is to preserve the past and forestall the future.

Bob Evans
Editor in Chief

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