[biztech-discussion] Offshoring Issues

  • From: Al Weinrub <Allen.Weinrub@xxxxxxx>
  • To: biztech-discussion@xxxxxxxxxxxxx
  • Date: Thu, 29 Apr 2004 22:55:52 -0700


The following is a perspective on the issues that we need to address in 
any NWU offshoring strategy. I culled these issues from various postings 
here, in articles, and other materials I have read. I think that is 
important to agree on the issues we need address as part of our strategy 

For the moment, however, what do you think of the perspective below? Are 
there other important issues? What is the relative importance or 
priority of these issues? Where is our opposition most vulnerable?

If we can agree on the issues to highlight and their relative priority, 
we will be better able to talk about how to take up offshoring in the union.

Sorry for the length. What do you think?

(SF Bay Area)



In organizing around the offshore outsourcing issue, namely in building 
opposition to the unfettered offshoring of technical and writing jobs to 
foreign countries, there are two general groups of people we need to reach:

- Our primary constituency--the folks we are trying most directly to 
organize and mobilize. These are members of the NWU, technical and other 
writers, and other high-tech workers. These are the folks with whom the 
NWU has the most affinity on this issue and who are most directly 
impacted by the loss of jobs.

- Our support constituency--the folks with whom we are trying to build 
political opposition to offshoring, the general public, other 
organizations, political leaders, and institutions.

The issues faced by these two groups are somewhat different and 
therefore these groups need to be addressed differently.


In reaching out to our primary constituency--people who have lost their 
jobs or are likely to lose their jobs, or who will be negatively 
impacted by the loss of jobs in their professions--we need to address 
the following concerns:

- Direct loss of jobs-loss of income and erosion of standard of living.

- Inability to find work in offshored professions--the jobs are going 
away permanently, so those who lose their jobs will face extended 
unemployment, and eventually will be forced into lower-paying, 
less-rewarding occupations.

- Dropping wage and work standards for those who remain employed-a 
surplus labor pool will drive down wages and benefits, accentuating a 
trend begun with the bursting of the dot com bubble a few years ago.

- A worsening job market in the offshored professions will force many to 
change careers, putting pressure on related jobs. Many tech writers, for 
example, will attempt to do other kinds of writing. This will be a slow 
and painful process for those whose jobs are offshored and will create a 
lot of job competition for those in related fields.

In addressing the above concerns, we need to undercut the standard 
economic arguments that justify offshoring and highlight the inequity of 
offshoring people who do the actual work in order to increase the pay of 
CEOs. We can use the soaring rise in CEO and other executive pay to 
expose the ingenuousness of the "competition" and "profitability" 
justifications for offshoring. (If cost and competition were really such 
crucial matters of corporate survival, why not offshore the CEO 
positions?) Also we need to address the hypocrisy of the 
"upgrade-your-skills" and "be-more-competitive" arguments of the 
pro-offshoring lobby. The jobs they told us to train for so our jobs 
wouldn't be offshored are now being offshored.


In reaching out to the general public, however, the above concerns are 
not paramount. In the U.S. economy, people are routinely forced to 
change jobs or careers due to economic conditions, and few will 
sympathize with technical workers in particular because of their 
relatively high salaries compared to blue collar workers. In addition, 
unionized workers and other blue collar workers are aware of 
white-collar workers' general disdain for unions and unionized workers.

In reaching out to the general public, we need to address a different 
set of concerns:

- Indirect loss of jobs and economic downturn. The flight of jobs can 
have a devastating impact on all sectors of the economy in much the same 
way that layoffs and recessions in the past have a big multiplier effect 
on many indirectly related jobs. Money is taken out of circulation and 
many economic sectors are impacted. This is especially true when there 
is no expansion of other parts of the economy to employ the unemployed. 
In past decades, you could argue that the expansion of the high-tech 
sector absorbed the impact of offshoring in the manufacturing 
industries. However, in the current situation there is no expanding 
sector (not even the Iraq invasion is creating significant numbers of 
new jobs). In addition, the speed of offshoring will be much quicker 
than the offshoring of the past (there is no need to build factories 
abroad and the labor pool is already trained), making its impact much 
harder to absorb. Hence, the impact of high-tech offshoring will be more 
far-reaching and more permanent than offshoring in the past.

- National security. High-tech offshoring is all about information 
processing, and the processing of information has become a crucial 
aspect of our society--whether it be related to military systems, 
economic infrastructure systems (such as the electrical power grid, 
transportation, communications, and so forth), business information 
systems (such as bank or corporate records or technology secrets), or 
vital services. The regulation and security of such information systems 
that exists within the United States does not exist in foreign 
countries-especially those to which most of the offshoring is 
going-making the U.S. and its citizens vulnerable to theft, electronic 
sabotage, infiltration, disruption of emergency systems, and other risks.

- Personal security. The pervasiveness of electronic records (such as 
medical records, life insurance, and individual financial records) makes 
them susceptible to invasion of privacy and the proliferation of private 
information. Even within the U.S., despite legal prohibitions against 
the invasion of privacy and prosecution of offenders, identity theft and 
illegal use of private data is rampant. Sending the processing of this 
data to countries which have minimal personal privacy laws and which do 
not prosecute illegal uses of personal information is inviting abuse. 
Abuse of medical records has already been reported in the press 
involving contractors who contract to contractors who contract to other 
contractors. No safeguards and a huge black market in the sale of 
personal information.

- Relinquishing technological leadership. By offshoring the development 
of new technologies to foreign high-tech workers, the U.S. is 
relinquishing its technological competitiveness. With foreign markets 
far surpassing the U.S. in size, the development of new technologies and 
new technical standards in foreign countries means that in the 
not-to-distant future, the U.S. will relinquish its technological 
leadership. Since this leadership has been a driving force of the U.S. 
economy, taking a back seat in technological development will have a 
significant negative impact on U.S. economic growth. In the same way 
that manufacturing industry has shifted abroad over past decades, 
information processing is currently shifting abroad, to be closely 
followed by the shifting of technological innovation abroad. Especially 
so, since the U.S. educational system is in shambles, compared to the 
production of high-tech professionals in many foreign countries.

- Public tax money is subsidizing and rewarding the offshoring of jobs. 
One aspect of this is tax credits, another is direct government subsidy 
(corporate welfare) of offending companies, a third is foreign-aid for 
infrastructure improvements to countries that are low-wage havens. (one 
reason that India can now take high-tech jobs is that American taxpayers 
are paying to upgrade the Indian telecommunications network.)

- Offshoring is being hidden from consumers. Consumers have a right to 
know who is doing the work they are paying for and who they are dealing 
with. This is a fundamental principle of ethical business practice and 
we see it every day when we are told over the phone that "this call may 
be recorded." Nevertheless the complex labyrinth of offshoring 
contractual relationships leaves makes offshoring invisible to consumers.

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