one prediction coming true

Discussion in 'Current Events' started by DKSuddeth, Jan 13, 2004.

  1. DKSuddeth
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    DKSuddeth Senior Member

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    I said before, this offshoring thing will turn into a mad scramble for the lowest cost labor around the world and will do nothing but shift from country to country. More of the 'race to the bottom' for us here in the good ole US.

    http://www.msnbc.msn.com/id/3949123/


    Any number of academics attempt to minimize the effects of the offshore outsourcing phenomenon by reassuring us that new jobs will take the place of the hundreds of thousands of programming, call-center, and other jobs shipped out to Asian countries. They frequently point to the U.S. at the start of the 1900s, when about half the population worked in farming. Today, only about 5% of the population farms, with all kinds of jobs having replaced farm labor.

    It's difficult to imagine what the replacement jobs for today's programmers and call-center operators might be, since none of the theoreticians offer specific examples. I recently received a possible peek into the future, though, in getting to know Ryan Kinzy, who, at first glance, seems to be just another high-tech entrepreneur who has thrown his life savings into an enterprise to sell special software designed to help sales people improve their productivity.

    A STARTUP'S PRIORITIES. The future Ryan is creating is a lot different than what the academicians suggest, but the effect could be the same in that the bottom line may well be more jobs as a result of outsourcing high-tech jobs. For now, it is a future in which labor is fungible and national borders nearly meaningless. It is a scenario that may offend lots of Americans who have lost jobs to India, Russia, and the Philippines, but may also provide a ray of hope from the outsourcing phenomenon. So hear me out.

    Ryan launched his company, K3 group, in Austin, Tex. 18 months ago using savings accrued from the good times in high-tech. One important lesson he had learned working in a large high-tech company immediately preceding his own startup was that the benefits of outsourcing of computer programming jobs, as currently practiced by large corporations, are often exaggerated.

    "There were too many headaches in dealing with India," he says, recalling his experience overseeing such work. "We often got spaghetti code that was functional, but couldn't grow. We had no idea if delivery dates would be hit because they would freely give promises, but not results. The time difference was very difficult. The explanation, 'They program while you sleep' doesn't hold water. Too often, a problem would arise and they would respond the next day with, 'Well, we weren't sure what you wanted to do' -- and a whole day was lost, time and again. Before long we were four months behind schedule. It was also very difficult to remotely manage a project unless you had a very strong infrastructure over there of U.S.-style managers. Finally, the rising costs over there make it tougher to justify."

    BANGALORE TORPEDOED. You might think that when Ryan launched his own company, he would have relied on U.S. labor. And that is what he did, at first. He and two other Americans developed the initial product themselves over the first year. He brought in a fourth employee, a sales person, last October. But while Ryan may have accrued skepticism about outsourcing overseas, there was never an ideological opposition to the proposition on his part. In fact, he kept thinking about how neat it could be -- and how much money it could save his cash-strapped startup -- if he could overcome the problems he had experienced in dealing with India.

    This past fall, when it was time to improve and expand K3's product offerings, an associate came up with an alternative to India: outsource to South America. The more Ryan investigated, the more he liked what he saw, and in December he took the plunge, sending work for up to five programmers to young developers in Colombia. Here is how the Colombian option compares to the Indian one:

    Cost. No contest here. The cost for a managed developer in India was $3,200 per month, vs. $1,000 a month in Colombia. [A managed developer is overseen by an onsite manager monitoring progress and quality, so the cost includes part of the manager's salary.] The difference in costs is so vast that it actually allows K3 group to make money in an area not known for profits, says Ryan. "Typically, with enterprise-application software, consulting for customer specific needs just breaks even. The benefit with having a low-cost development outsourcing partner is that we can make money with consulting."

    Quality. Ryan also expects that the days of spaghetti code are over. "You have to get the developers fairly young so they haven't learned bad habits," he says. This means grabbing them a couple years out of school. After a few years working for a company like K3, he says, these developers are typically grabbed by banks and other major companies, but K3 has obtained useful production from them.

    Real-time communications. Colombia is essentially in Austin's time zone, "which is very very good," says Ryan. In contrast to dealing with Indian programmers, "We now find out about issues before they become problems." Moreover, Ryan and his colleagues speak with the developers in Colombia using VOIP [voice over Internet protocol]. This means their conversations and conferences are free. "This keeps the costs way down," says Ryan.

    Flexibility. Because K3 doesn't know for sure how its business will go this year, it can't be certain how much programming it will require from its Colombian team. But the Colombians are eager enough for work that K3 group can use anywhere from one to five programmers at any time, based on its needs at the moment.

    The reason K3's approach is so intriguing is that a startup has a different mission in life from that of many large corporations -- to grow rather than to cut costs. To the extent that K3 keeps its costs down, and attracts new customers, it expands, which inevitably creates new jobs. The exact nature of the new jobs isn't entirely clear, especially since, in small companies, many people handle multiple tasks. But one thing we do know from a number of past studies is that young, fast-growing companies create many more jobs than Fortune 500 outfits.

    Sure, some of the new jobs will be in Colombia, or wherever K3 group moves next in its search for low-cost programming labor. That's the beauty of virtual operations and borderless commerce. But some of the new jobs will inevitably be in the U.S.

    Moreover, the K3 model has stimulated Ryan's creativity. He is now thinking of establishing his own outsourcing business -- perhaps in a tropical country, near a beach.
     
  2. rtwngAvngr
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    rtwngAvngr Guest

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    You're right DK. But the U.S. has a a global responsibility; it's not just here for the benefit of fat, lazy, culturally bereft Americans. You're starting to sound like Pat Buchanan.
     
  3. DKSuddeth
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    DKSuddeth Senior Member

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    the US has a responsibility to provide for the economic advantages of peru? australia? madagascar?


    If you truly think that then why aren't you out there cheering for the one world government also?


    If there is ANY global responsibility of the US its ONLY to provide military safety of our allies.
     
  4. DKSuddeth
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    DKSuddeth Senior Member

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    the more I think about this the more I can only believe that you are a troll on these boards.
     
  5. rtwngAvngr
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    rtwngAvngr Guest

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    You and pat buchanan are on the same page here. Don't blame me.

    http://www.wnd.com/news/article.asp?ARTICLE_ID=36355

    ------------------------------------------------------------------------

    ------------------------------------------------------------------------
    Bushite betrayal of working America
    ------------------------------------------------------------------------
    Posted: December 29, 2003
    1:00 a.m. Eastern
    Pat Buchanan

    ©_2003_Creators Syndicate, Inc.


    On Christmas Eve, a story and column in the Washington Post caught the eye. For they tell much about the two Americas we are becoming under George Bush and a Democratic Party that has cut its roots to working America.

    The front-page story by Mike Allen describes a Bush initiative on "immigration reform." Seems that U.S. employers would post jobs and the wages that go with them on a Department of Labor website. If no Americans came forward to take the jobs, the employer would be allowed to bring Mexican temporary workers in legally, give them the jobs, and put them on a fast track to permanent residency and citizenship.

    What would this mean? U.S. companies would offer pay at or near the minimum wage for jobs they had open in, say, construction.

    As few Americans can support a family and kids in school on $5 an hour, many of these jobs would go begging. The employer would then be allowed to go to Mexico, where the minimum wage is about 60 cents an hour, or countries where it is even less, and hire all the hard-working labor he needed at the U.S. minimum wage.

    As there are billions of people on earth who do not earn anything near $5 an hour, what the Bush plan means is throwing open America's borders to millions of workers who will come in and suppress the wages of America's workers.

    Why the U.S. Chamber of Commerce might love this is easy to understand. But what is Bush doing to the working Americans who put him in office? Yet, as one reads further in the story, it appears it is not Bush who is doing this, it is boy-wonder Karl Rove. Bush's guru seized on the idea as part of the campaign's "compassion agenda."

    In addition to bringing in millions of workers who would take jobs at a fraction of a living wage for American families, Bush will propose that 10 million aliens, who are in this country illegally, be made legal.

    According to the Post, Rove & Co. "concluded that they needed a response to the large population of undocumented workers for the plan to be credible and for Bush to get credit from Hispanic voters.

    In that last clause lies the motive behind the sellout.

    Rove is pandering to Hispanics, giving militants in the Latino lobbies what they demand – some form of stealth amnesty, where those who broke into this country are made legal residents of the United States and put on the path to citizenship. He is buying votes by selling out the white working class, which, presumably, has nowhere else to go.

    As a sop to those who believe aliens who break our laws should be sent back home, the Bushites promise better border controls. In brief, if you want Bush to enforce America's immigration laws, you must permit him to pardon those who broke these laws. And if you agree, Bush will promise to be more conscientious in doing his presidential duty to defend the borders of the United States.

    How are the Bushites shafting American workers? Let me count the ways. Under Bush's free-trade zealotry, the United States has lost manufacturing jobs for 40 straight months, the longest stretch since the Great Depression. Under Bush, hundreds of thousands of high-tech workers have been brought into the United States to take jobs at wages one-half or a third of those commanded by the U.S. workers they replace.

    Under Bush, the "outsourcing" and "off-shoring" of U.S. jobs has accelerated, with tens of thousands of jobs once held by high-paid white collar and information-technology workers going to Asia.

    Under Bush, millions of legal and illegal immigrants have poured into the country, putting downward pressure on wages.

    Under Bush, the merchandise trade deficit has risen to $550 billion, which represents a massive annual transfer of factories, jobs and technology. China, Japan and East Asia are the lead looters of America's once-awesome manufacturing base. Americans today buy nearly 15 percent of the entire GDP of China. The Chinese buy two-tenths of 1 percent of ours. It's what the Bushites call "free and fair trade."

    What are the consequences for American workers? In a Post column, "Un-American Recovery," Harold Meyerson says it all.

    U.S. corporate profits have been rising for 7 months. In the third quarter of 2003, the economy grew at 8.2 percent, productivity at over 9 percent. Have our workers shared equally in the good times?

    Writes Meyerson: "Since July, the average hourly wage increase for the 85 million Americans who work in non-supervisory jobs in offices and factories is a flat 3 cents. Wages are up just 2.1 percent since November 2002, the slowest wage growth we've experienced in 40 years."

    That's right. According to Meyerson, the wages of Americans have gone up three cents since the economy took off on a tear in July.

    Let it be said: Working America has no powerful voice in politics. Both Democrats and Republicans are open-borders, free-trade zealots, who troll for cash from corporate America and burn their incense at the altars of the global economy.

    America needs a new party.
     
  6. DKSuddeth
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    DKSuddeth Senior Member

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    Ok, I side with Buchanan on this. How do you think he's wrong?

    Suffice it to say, It is not the US's job to raise the economic standards of the 3rd world. If they can participate in it, great, but not at my, or my families, expense which is exactly what most of our executive and legislative branch has been doing.
     
  7. rtwngAvngr
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    rtwngAvngr Guest

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    I think clamping down immigration to keep American wages high, is a form of protectionism, and will, in the long term, make our nation less competitive in the global marketplace. Our items will be too expensive. I understand it's tempting to seek to protect our careers, but ultimately we must bravely face the competitive enviroment future will, and should, be. America should continue to being a glowing beacon of commerce, security, freedom and individual rights, with and open door policy to anyone who want to contribute to that vision.

    :clap1:
     
  8. DKSuddeth
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    DKSuddeth Senior Member

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    Did I just see you support illegal immigrants in this country?
     
  9. rtwngAvngr
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    rtwngAvngr Guest

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    No. We need to have them all go through the proper channels. I could support a one time amnesty for current illegals, and a fastrack into the new worker program, just because we need to get data on people for security purposes. Am I happy that it sort of rewards those who broke U.S. immigration law? NO.
     

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