Wednesday, December 14, 2005

The Perils of Outsourcing

In an article for the forthcoming issue of The National Interest. Maurice R. "Hank" "Greenberg makes the following point: "We cannot survive as a nation of only service industries, of plumbers and electricians and other day-to-day jobs that cannot be outsourced." Yesterday, Harry Harding, Eurasia Group's director of research and analysis, was talking about the 200-mile radius rule--that if a good or service is offered to you beyond your need to reasonably go out and get it--it can be outsourced--because it doesn't matter to you whether it comes from 201 miles away or 2,001 miles away. Take health care. The person who takes your x-ray needs to be someone who is reasonably geograpically proximate to you--but given advances in telecommunications the person who analyzes the x-ray can be anywhere around the world.

So your doctor, car mechanic, gardener, barrista--these are people who need to be "close" to you--but everyone else is vulnerable. Even me--in theory, an editor can be anywhere in the world as long as you have a good computer and internet connection.

There are, of course, consequences. The first, as Harry pointed out, is that in the United States unions are increasingly focusing their efforts on those jobs and sectors that cannot be outsourced--health care, the universities, government. Interesting to speculate on the future of the labor movement as a result.

The second is that the United States, as Greenberg noted, cannot indefinitely continue its trade imbalance. The United States needs to reconcentrate its entrepreneurial energies and human capital on developing "the next generation" of goods and services. A point also raised by former Energy Secretary James Schlesinger--that the country that can break energy dependence on petroleum will have an immense technological advantage over other states.

Perhaps it is time for the U.S. to reconsider its stand on industrial policy? (See also our previous discussion on Challenging Orthodoxies).

Comments:
Does the government do a better job than the private sector in directing investment? One can argue that the Manhattan Project or Project Apollo were highly inefficient and wasteful but would the private sector have built an A-bomb or gone to the moon? What the private sector was able to do was to spinoff so many other industries and products from the original government investment as to make it worthwhile.

Energy independence is a national security imperative. A government-led effort can produce the spinoffs that will create new U.S.-based industries and give us a new comparative advantage.
 
Iwebresources: Looking for some IT projects.


Interactive Web Resources is an outsourcing company focused on serving the needs of Small Medium & Large size Businesses in the U.K, Australia, U.S, Europe, Canada & English speaking countries.

Interactive Web Resources as your outsourcing partner help's you to increase your profits, reduce business risk and create breakout value with new services and revenue streams.

IT Out sourcing Is Our Business
We are a Delhi based IT out sourcing company. Providing quality IT related services have been our focus ever since May 2004. From web site designing to web support, we deliver cost effective and reliable systems.There is no doubt that IT out sourcing is a most effective way to stretch your budget.

Whether you need any type of IT related services we have what you need at prices you can afford At Interactive Web Resources, our goal is to provide you with courteous, expedient, professional service of the highest caliber. Browse our Web site for more information about Interactive Web Resources. At Interactive Web Resources, the customer always comes first. We serve you Better.

Our Focus
Our focus is to serve the most professionally managed Overseas companies / Leading IT Companies / MNC's and Any type of company, who demands IT related services of highest standard & wants to avail the same with a difference.

We provide professional services in: -
* Data Entry & Copy Writing
* Web Designing & Web Promotions
* Content Writing
* Graphic Designing
* E-Commerce Solutions
* Web Support
* 24/7 Live Support
* You Name A Service & We Render It.

Email: sharad@iwebresources.com
URL: http://www.iwebresources.com
 
Post a Comment



<< Home

This page is powered by Blogger. Isn't yours?