Sunday, July 17, 2005

Recent Outsourcing Horror Visions

I'm hardly the first person to gripe about this, but there's an unsettling trend in America to send work offshore. The proponents of this practice defend it by saying that manufacturing and industrial jobs also went overseas but didn't compromise American supremacy.

Well, they're half right. There are some responses to this trend in the July 2005 Software Development magazine's feedback section (registration required). Michael Wheelen's letter succinctly identifies the entrapment of the American IT worker. An excerpt:

"We as American workers are stuck. Until cost and pricing stabilize around the globe, our economy will suffer the most because we have the highest cost of living."


"The global economy is here to stay, but let's replace the old dogs with young dogs - people who understand the new technology and can manage it to everyone's benefit; young blood can create a win-win for corporate America and the public. For example, why not let the corporations outsource, but when the end product returns to America, fix the profit to a certain percentage of cost?"
Great letter, but of course what Wheelen is asking for isn't going to happen. In particular, with software, there's no tangible product to tie a profit to, and as IT veterans know, no software truly has a finite cost - as long as it's alive and being used and maintained, the true total cost grows with the life of the software. The old dogs have a little too much power too, and it always seems the young dogs that finally do replace them have learned their tricks from the ones that went before.

In the same issue, another letter, American Decline, from Thomas Ronayne serves a chilling image. He wrote:

"American companies are run by fools interested only in short-term results, and the offshore community is ready, eager and willing to
step in and take over. Because the relationship between government and industry in the United States is adversarial (compared with that in, say, Japan and Korea), we've seen the steel industry more or less vanish, the automobile industry get into deep trouble and the electronics industry disappear...we're on the rapid road to becoming a client of other countries that are willing to invest in their future. If we had to fight a war with Asia, we wouldn't be able to produce the basic materials we'd need to do so."
I hope that's a touch more sensationalist than reality would have. I'd read not long ago about how the steel industry in Philadelphia is making a bit of a comeback because after demand outpaced supply in other countries, the US was able to compensate at a competitive rate. Economic equilibrium is the key to making globalization less painful. Still, I can see the US being stupid enough to get to a point someday where the native industrial capacity could be completely gone, or enough diminished that if a wily agent of chaos could organize our allies to turn on us, there would be no foundation to support a future generation's "Rosie the Riveter."

But in the previous generations of offshoring, and in Ronayne's vision, the jobs being sent away from North American borders were largely physical jobs not involving soft skills. And if you look at the industrial offshoring efforts, not all of the work even left North American borders, moving to Mexico and Canada (ah, how arrogant we are to assume that America or North America always means "the USA").

But the know-how is still in the US! If there were a disaster, or a war with large scale scope, I'm optimistic that our engineers and surveyors and construction workers could find a way to adjust and still get the work we needed done at home to support a war effort. And North America is still a gifted geographical wonder, with natural resources galore, and still bordered by large bodies of water. You can compromise your opponent's industrial capacity and maybe even its economy, but no one gets a free pass from Mother Nature. Invading the US wouldn't be the cakewalk that Ronayne thinks it would be.

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