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Thread: ironic ain't it - 'outsourcers' now being outsourced !

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    Default ironic ain't it - 'outsourcers' now being outsourced !

    "Indian bank workers angered by outsourcing
    By Amy Yee in New Delhi
    Published: July 29 2006 03:00 | Last updated: July 29 2006 03:00
    Half a million bank workers in India, home to one of the world's most robust outsourcing industries, walked off their jobs yesterday to protest against moves to outsource their own work to private domestic companies.

    The one-day strike was a response to "continuing attacks on the banking industry and bank employees' jobs and job security", said the All India Bank Officers' Association, one of three unions organising the protest.

    The unions say outsourcing in India's banking industry would threaten 250,000 jobs.

    India's software and business process outsourcing industry is one of the country's biggest engines of growth. Companies such as Infosys, Tata Consultancy Services and Wipro together generate billions of dollars a year from multinational companies shifting work overseas to cut costs.

    But union leaders say their complaint is different from that of workers in rich countries who have lost jobs to India.

    "We are an impoverished nation," said R.J. Sridharan, general secretary of AIBOA. "India is a labour-oriented country so we need more jobs that are secure. Developed countries have fewer hands to work."

    The Reserve Bank of India, the country's central bank, has proposed letting banks hire outside agencies for tasks such as processing loan and credit card applications, supervision of loans and data processing.

    "The world over, banks are increasingly using outsourcing as a means of both reducing cost and accessing specialist expertise," said an RBI circular that offered guidelines on outsourcing financial services.

    Mr Sridharan said outsourcing "absolutely does not lead to more efficiency. It creates complications in rendering good customer service."

    He claimed that India's banks were trying to outsource jobs with a view to offset low-cost lending to corporate sectors.

    Organisers of the strike are also demanding curbs on sales of stakes in state-run banks, limits on foreign direct investment, and better pensions."


    IMHO this is evidence of a global 'race to the bottom', where economic growth will continue to migrate to wherever in the world offers the cheapest slave labor, the most lenient environmental / workplace / benefits requirements etc. I can hear the corporate boardroom conversations now ... " how dare those Indian / Chinese workers now expect a $2 an hour in pay rate - and what's this s#!t about them expecting pensions ? ... call Vietnam ... call Bangladesh .... if we moved our workload from the USA to China / India once, we can certainly move it again !"
    .

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    Amazing.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    ^^^ what will REALLY be amazing is the predictions that the Chinese economy is on the verge of crashing and burning in the next couple of years ... because the Chinese gov't is withdrawing its export subsidies, energy subsidies etc. - because the Chinese Banks are starting to build a very tall pile of delinquent business loans - because Chinese wage rates are approaching 'non-competitive' levels of $2 an hour in coastal cities where 'outsourced' goods are typically manufactured - because China's artifically low currency exchange rate is being forced upwards - because capital is taking flight on fears the Chinese gov't will reneg on promises made etc.

    The following is a bit dated, but really summarizes the risk factors well ...



    (snip)"While the positive side seems to have a long list, the list of the dark side is even longer. Basically, I divided China’s economic problems into two categories: macro-economic problems and socio-economic problems.

    For macro-economic problems, there are issues of government budget, national income account, banking and financial market, and state enterprises. For socio-economic problems, there are issues of unemployment, income and wealth distribution, farmers and agriculture, mass corruption, declining social morals, failing education, huge environment and ecology problems.

    Moreover, there are two more problems above these problems: one is that government official statistics are not reliable; the second one is that after the “reform and open” policy over the past 25 years the Chinese Communist Party (CCP) has not changed as a political system. The CCP has not changed its nature in the slightest way at all."(snip)

    The latter refers to the Chinese Gov'ts ongoing use of state power to supress public discontent / demonstrations / riots by Chinese 'working class' citizens, despite the Chinese Gov't having invested billions to implement the so-called 'Golden Shield' to try and keep their citizens (and also foreign investors) in the dark.
    Last edited by Melonie; 07-29-2006 at 08:56 AM.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    Seems some indian outsources are dumping companies (like Dell) because there isn't enough money! Good commentary here too:

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    And of course the internet's favorite comic:

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    Banned Melonie's Avatar
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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    Seems some indian outsources are dumping companies (like Dell) because there isn't enough money!
    ... but this also means that Dell (and other companies whose 'low bids' were similarly turned away) will now be looking towards Thailand, Vietnam etc. where English speaking slave labor is even cheaper ! As your comic link so aptly illustrates, the actual 'service' being performed by most of these outsourced call centers has nothing whatosever to do with actually solving problems, but merely providing an English speaking voice to keep American callers occupied until their warrantee runs out. !


    PS more opinion on impending Chinese Economic Doom at ...
    Last edited by Melonie; 07-29-2006 at 11:38 AM.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    This is the process. The Indians and Chinese are not immune. The will lose low-end jobs as living standards rise.

    The textile manufacturing that moved from the US south to China, Pakistan, Mexico, etc in the last 20 years didn't originate in the US South -- it moved there in the 1920s from New England, because wages got too high up north. Low-value added manufacturing has been moving within China for over a decade, away from the high wage areas around Guanghou, Shanghai and Beijing.

    Melonie, I think one of the more interesting things in China in the next 24-36 months is going to arise from the volatility of investment spending. I may be a year out of date, but I think last year something like 45% of Chinese GDP was investment spending, much of which was driven by low money costs created by Chinese monetary policy. At some point there has to be a contraction -- not all that money is going to be invested wisely -- which will threaten a weak banking system. Could be more exciting than we want it to be.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    P.S. -- I have to object to the "slave labor" description. They may not be just like us, but the workers I have seen in those countries are just as decent and ambitious and striving as Americans. The want good things for themselves and their children just like we do. Sure there is lots of oppression in some of these places, especially of women, but not infrequently the chance to work for a Western firm is the opportunity to get out of oppression, not the consequence of oppression.

    You and I wouldn't want to live in a factory dormitory, and the movement to force companies to improve working standards is a good one, but I think the analogy to slavery is badly misplaced.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    But union leaders say their complaint is different from that of workers in rich countries who have lost jobs to India.

    "We are an impoverished nation," said R.J. Sridharan, general secretary of AIBOA. "India is a labour-oriented country so we need more jobs that are secure. Developed countries have fewer hands to work."
    Are they fucken kidding??? Yeah, it's ALWAYS different when it's YOUR job that's being threatened Exactly WTF do they think those of us HERE are doing who've lost our jobs to THEM??

    But on a less heated note - that's the cycle as mentioned above. They will have to adjust to the changing job market the same as we have. I wonder where those jobs will go once places like Vietnam and Thailand have become "too expensive" for the greedmeisters

    Quote Originally Posted by pheno View Post
    When you lead a nontraditional life don't try to measure it with traditional milestones.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    Quote Originally Posted by casaubon1
    P.S. -- I have to object to the "slave labor" description. They may not be just like us, but the workers I have seen in those countries are just as decent and ambitious and striving as Americans. The want good things for themselves and their children just like we do. Sure there is lots of oppression in some of these places, especially of women, but not infrequently the chance to work for a Western firm is the opportunity to get out of oppression, not the consequence of oppression.

    You and I wouldn't want to live in a factory dormitory, and the movement to force companies to improve working standards is a good one, but I think the analogy to slavery is badly misplaced.
    It's called slave labour not becuase of any perceived difference between them and us. It's called that because it's so much cheaper than the local options - a large western company can get workers from certain eastern areas for pennies on the dollar, not to mention the less desirable working conditions offered to those same workers. People in impoverished areas will work for peanuts and, for a while, take nearly all the abuses the company wants to dish out. That's not much of a stretch from what it would've been like to be a slave.

    Quote Originally Posted by pheno View Post
    When you lead a nontraditional life don't try to measure it with traditional milestones.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    ^^^ Agreed.

    The labor is not being paid a fair portion of the value they are creating. The customers aren't getting such a deal either. The middle men in are pocketing the difference.

    Getting people in a bad spot to make something for 50 cents only to sell it at 100% to 200 % mark up - that is fucked up. Helping to raise other nations my ass.

    Race to the bottom.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    Doesn't sound like this is going to be an open minded discussion. When when you can show me that US GDP per capita has declined as a result of all this, give me a call.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    Maybe you should investigate how GDP is really distributed amongst the citizens. Hopefully you will find it eye opening and a context to see how things are.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    Quote Originally Posted by Bridgette
    I wonder where those jobs will go once places like Vietnam and Thailand have become "too expensive" for the greedmeisters
    Probably to a robot in Vietnam and Thailand. To create further savings, they'll even have repair robots in place of maintenence people to fix the worker robots when they break down.

    Soon after, the greedmeisters will replace even themselves with robots with human like AI which will completely remove humanity from the process. Before long, all that fictionalized crap from "I Robot" and "the Terminator" movies will start becoming reality.

    Of course, I could be wrong. Maybe the worker robots will organize a union before the worse case scenario hits.
    Former SCJ now in rehab.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    OK, that is one on which I will reengage. You are right. This issue is distribution. The question is not whether these trends themselves are good -- the transfer of low-end economic activity to India, China, etc. has raised average income in both the US and in those countries.

    It also has harmed specific businesses and lots of individuals -- without question. But just as we did not freeze the development of computer technology at the stage of punched cards to protect the jobs of keypunch operators, I respectfully think the better view is that we cannot let those who are harmed force upon us a policy that is bad for the country as a whole. We can, and should, try to soften the impact on them, though.

    But my main point was to object to the demonizing of the workers overseas, calling them slaves, or whatever. This is a very unfortunate byproduct of the political debate. We see a lot of focus on this site about not perpetuating stereotypes of dancers. We should extend the same understanding to some very decent people overseas, many of whom are smart, ambitous and grabbing at the best opportunity their country has offered them in generations. Sure they will work for less, but that is because they don't have our opportunities.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    Dood. What are you talking about with this "demonizing" the overseas workers nonsense?? We are not calling them slaves to demean them. Your comprehension is lacking here. The "slave labour" term is demonizing the companies in this topic, if anything. No one here is blaming the WORKERS for this. Duh! If anyone is to blame it's the greedy corporations who seek out the cheapest labour they can find.

    Quote Originally Posted by pheno View Post
    When you lead a nontraditional life don't try to measure it with traditional milestones.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    We should extend the same understanding to some very decent people overseas, many of whom are smart, ambitous and grabbing at the best opportunity their country has offered them in generations. Sure they will work for less, but that is because they don't have our opportunities.
    I'll agree with this wholeheartedly, at least in terms of the basic goals of 'average people' overseas. However, in terms of 'certain people' i.e. local 'upper class' business owners and managers, it is arguable that the degree of profit 'non-sharing', worker 'exploitation' etc. is on the same level as America was 100 years ago.

    However, in truth, overseas workers now do have an opportunity that the US no longer has ... the opportunity for 'average people' to provide a higher standard of living for the next generation than the previous generation enjoyed.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    Incomes are not going up for everyone! That is a globalist lie!

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    Quote Originally Posted by Melonie
    I'll agree with this wholeheartedly, at least in terms of the basic goals of 'average people' overseas. However, in terms of 'certain people' i.e. local 'upper class' business owners and managers, it is arguable that the degree of profit 'non-sharing', worker 'exploitation' etc. is on the same level as America was 100 years ago.
    And I agree with this point also. The biggest problem on factory conditions is locally owned operations at the bottom of the production chain -- small foundries, machine shops and the like. Frequently lousy worker safety and environmental conditions, totally aside from pay. The other end of the spectrum are Western-owned factories, where, with some exceptions, conditions are quite good, holding to Western rather than local standards, in part because of the effective PR campaigns in the US and Europe to point out deficiencies. In between are the leading locally-owned operations -- they are getting a lot better fast in places like China.
    It is important to keep the pressure on suppliers to move up to Western standards -- those buyers with the most exposure to public criticism -- e.g. big retail chains -- have been the most active in pushing local suppliers to move up.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    Quote Originally Posted by Bridgette
    Dood. What are you talking about with this "demonizing" the overseas workers nonsense?? We are not calling them slaves to demean them. Your comprehension is lacking here.
    If you don't think calling someone a "slave" is demeaning, that is your view. I have a strong hunch you have never met a single one of them.

    Hop on a plane and go to a call center in India. Talk to them. (They speak English, by the way.) You will meet young people buying apartments and surfing the web in internet cafes. Sure, there are nasty conditions in all sorts of places -- West Virginia coal mines come to mind as well as small foundries outside of Shanghai. But my point is don't just assume you know what is going on and draw a broad conclusion -- there are a lot of things happening, not all of them bad.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    Quote Originally Posted by Deogol
    Incomes are not going up for everyone! That is a globalist lie!
    And the best for last. All night long, when you are asleep, canny Vietnamese are scheming to lower world standards and take your job. Worry about it.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    Incomes are not going up for everyone! That is a globalist lie!
    This is certainly the case when factory wages in China have increased from $100 a month to $200 a month, whereas factory wages in the USA have gone from $18/hour to zero, with a substitute job offering $12/hour. This is exactly my point re future living standards increasing in China etc. while the USA is destined for a major decline.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    Melonie, thanks for maintaining a civil tone in this. I gather that for some reason SW is a hotbed of the antiglobalist movement, and as an internationalist I don't think it is going to be worth much more time on this topic from my end. I spend too much time on this issue in my day job as it is.
    I have a lot of respect for the time you put into this part of the site, though, so one last response. The IMF data I have on world mfrg wages only goes through 2003, but it shows the US mfg wage rising steadily for the time period I have (the decade 1994-2003) -- an average increase of 3% per year in the hourly wage. So even in the mfg sector, we are not seeing an actual decline in U.S. average wages. And of course, the real engine of US growth has been outside the manufacturing sector.

    Those are index numbers, but the absolute data for 2004 compiled by NAM also contradict the point. They show average full compensation for U.S. manufacturing workers (including benefits) at an annual level of $64,850 in 2004. Spreading that over a 2000 hour year, you get an hourly amount of slightly over $32.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    FFS man. You're missing the forest for the trees, so to speak. Using the term "slave labour" is not meant to demean the workers - it's a demonization of the money-grubbing corps. Why can you just not see the difference??? We all know there's a lot more going on. Caus dear, you're really starting to sound like an awful big know-it-all.

    Quote Originally Posted by pheno View Post
    When you lead a nontraditional life don't try to measure it with traditional milestones.

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    Default Re: ironic ain't it - 'outsourcers' now being outsourced !

    So even in the mfg sector, we are not seeing an actual decline in U.S. average wages.
    I hate to resort to semantics, but it does make a difference in what is actually being measured. Your statistics accurately indicate that, for those US manufacturing workers who still have jobs, their annual wages are still rising (albeit arguably slower than the true US$ inflation rate). What your statistics do NOT illustrate is a direct comparison of current pay rates for say 1 million US manufacturing workers who existed in say 2000. Six years later, the 700,000 or so who still have jobs in the US manufacturing sector are marginally better off ... however the 300,000 who were forced out of the US manufacturing sector due to downsizing, outsourcing, corporate bankruptcy etc. are nowhere near as well off with the earnings from their 'replacement' jobs. Thus if you average the current earnings of those 1,000,000 original US manufacturing workers today, the downside washes out the upside by a large margin.

    Admittedly I'm pulling numbers out of the air here to illustrate the point ...

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