"A child's learning is the funtion more of the characteristics of his classmates than those of the teacher." James Coleman, 1972

Thursday, April 19, 2007

Working to Raise Test Scores While America is Exported

While the Congress deliberates over the Business Roundtable's and the Aspen Institute's Great Domestic Diversion, NCLB, American corporations continue their off-shoring of American jobs, both service jobs and highly-skilled professional jobs. And while the U. S. Chamber of Commerce polishes its plans to transform American high schools into science and math camps, Boeing and Cisco continue to funnel science and engineering jobs to cheap labor markets overseas:

Boeing now employs hundreds of Indians for aircraft engineering, writing software for next-generation cockpits and systems to prevent aircraft collisions. Investment banks like Morgan Stanley are hiring Indians to analyze American stocks and to write reports for institutional investors, jobs formerly done by Americans earning six-figure salaries on Wall Street.

Eli Lilly is doing major pharmaceutical research in India. Cisco Systems, the leading maker of communications equipment, will have 20 percent of its top talent in India within five years, and global-consulting giant Accenture will have more employees in India than in the United States by the end of this year.

IBM reduced its American work force by 31,000 while increasing its Indian staff to 52,000. Citigroup, which already has 22,000 employees in India, plans to eliminate 26,000 jobs in the U.S. and increase its Asian work force by another 10,000 where the pay is lower.

Follow the money, of course, explains this massive shift in jobs. It's cheaper to hire and produce in India than in the United States.

The unhappy results of these policies are now apparent; they richly benefit the corporations but are devastating to the American middle class. Outsourcing reduces good American jobs, our standard of living, our national security, and our world leadership.
At the same time, Bill Gates argues for throwing open the door to import skilled workers in order to train foreign nationals who will return to their home countries to run the operations that he plans to export:

Corporations whine that H-1Bs are needed because of a shortage of Americans with skills, but major studies at the University of California Davis and Duke University conclusively prove we have thousands of unemployed or underemployed Americans with all the needed technical skills. Nobel economist Milton Friedman accurately labeled H-1Bs a government "subsidy" to enable employers to get workers at a lower wage.

The best way to deal with the demand for a limited number of H-1Bs would be to auction them off, so then we would find out if they are really needed and how much they are worth. An auction would enable taxpayers to get some return on the H-1B subsidy instead of the current system that allows corporations to influence congressmen with campaign contributions and pay high-priced lobbyists to get legislation to increase the number.

Contrary to corporate propaganda, H-1Bs are not an alternative to outsourcing skilled jobs but a vehicle to promote outsourcing. H-1Bs enable corporations to bring in foreigners, train them in American ways, and then send them back to guide outsourced plants in Asia.
Who can we blame for all this? Well, of course, it is the fault of the teachers and children in our public schools. And who has the solution? Well, of course it is a corporate solution, which, if unchecked, will eventually lead us to online corporate schools manned and womaned by disembodied voices located somewhere in a foreign country lecturing on the virtues of American democracy.

Here is a clip from a most interesting piece on Princeton economist, Alan Blinder, with links to his important article that appeared in Foreign Affairs last year. Which jobs are likely to be safe from export? The ones that physically cannot be exported by corporate bosses who don't give a damn about the consequences, a fact that places a new educational premium on auto mechanics as compared to, say, computer graphics. It also gives added added credence to Lester Thurow's mostly forgotten dictum that for America to survive, we have to make things.

From Finance Mentor:

At Princeton, he began to reassess some of his views on trade. Visiting the yearly business gabfest in Davos, Switzerland, in January 2004, he heard executives talk excitedly about moving jobs overseas that not long ago seemed anchored in the U.S. ...

. . . .

[H]e'd begun to wonder if the technology that allowed English-speaking workers in India to do the jobs of American workers at lower wages was "a good thing" for many Americans. At a Princeton dinner, a Wall Street executive told Mr. Blinder how pleased her company was with the securities analysts it had hired in India. From New York Times' columnist Thomas Friedman's 2005 book, "The World is Flat," he found anecdotes about competition to U.S. workers "in walks of life I didn't know about." ...

At the urging of former Clinton Treasury Secretary Robert Rubin, Mr. Blinder wrote an essay, "Offshoring: The Next Industrial Revolution?" published last year in Foreign Affairs. "The old assumption that if you cannot put it in a box, you cannot trade it is hopelessly obsolete," he wrote. "The cheap and easy flow of information around the globe...will require vast and unsettling adjustments in the way Americans and residents of other developed countries work, live and educate their children." (Read that full article.)

In that paper, he made a "guesstimate" that between 42 million and 56 million jobs were "potentially offshorable." Since then he has been refining those estimates, by painstakingly ranking 817 occupations, as described by the Bureau of Labor Statistics, to identify how likely each is to go overseas. From that, he derives his latest estimate that between 30 million and 40 million jobs are vulnerable.

He says the most important divide is not, as commonly argued, between jobs that require a lot of education and those that don't. It's not simply that skilled jobs stay in the US and lesser-skilled jobs go to India or China. The important distinction is between services that must be done in the U.S. and those that can -- or will someday -- be delivered electronically with little degradation in quality. The more personal work of divorce lawyers isn't likely to go overseas, for instance, while some of the work of tax lawyers could be. Civil engineers, who have to be on site, could be in great demand in the U.S.; computer engineers might not be. ...

Diana Farrell, head of the McKinsey Global Institute, a pro-globalization think-tank arm of the consulting firm that has done its own analysis of vulnerable jobs, calls Mr. Blinder "an alarmist" and frets about the impact he is having on politicians, particularly the Democrats who see resistance to free trade as a political winner. She insists many jobs that could go overseas won't actually go.

Ms. Farrell says Mr. Blinder's work doesn't take into account the realities of business which make exporting of some jobs impractical or which create offsetting gains elsewhere in the U.S. economy. ...

Mr. Blinder says there's an urgent need to retool America's education system so it trains young people for jobs likely to remain in the U.S. Just telling them to go to college to compete in the global economy is insufficient. A college diploma, he warns, "may lose its exalted 'silver bullet' status." It isn't how many years one spends in school that will matter, he says, it's choosing to learn the skills for jobs that cannot easily be delivered electronically from afar.

Similarly, he says any changes to the tax code should encourage employers to create jobs that are harder to perform overseas. While Mr. Gomory, the former IBM chief scientist, suggests tax breaks for companies that create "high value-added jobs," Mr. Blinder says the focus should be on jobs with person-to-person contact, regardless of pay and skill levels -- from child day-care providers to physicians.

Mostly he wants to shock politicians, policy makers and other economists into realizing how big a change is coming and what new sectors it will reach. "This is something factory workers have understood for a generation," he says. "It's now coming down on the heads of highly education, politically vocal people, and they're not going to take it."

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