Offshoring. The very name strikes fear into the tech community. We have to protect those jobs! Keep them from going overseas! Taxes! Tariffs! Quotas! Whatever it takes, do something to stop it!
The emotional response, yes, but unfortunately the wrong one. because if you do that, then this becomes impossible:
Kathy Brittain White has a dream. She figures if U.S. CIOs will ship programming jobs to India to save money, maybe they'll ship them to rural Arkansas instead. So White's company, Rural Sourcing, is setting up outsourcing centers in places in the U.S. where the cost of living is low -- not as low as in Bangalore, but low enough to compete with the total cost of offshoring.
Because that's the other side of the offshoring equation, the one big media ignores and big labor tries to hide. While third world labor is cheaper than US labor, often by orders of magnitude, it's nowhere near as efficient as US labor. The United States has one of (I'm pretty sure it's the) most efficient labor forces in the world. We're expensive, but we get the job done right, the first time, and almost faster than you can complete the specification. It doesn't much matter if you only pay Haji $3 a day to make your widgets when it takes him two days to make one that's any good. Far better to pay Jane $18 an hour and have her turn out fifty perfect ones in a day.
Companies are often wooed by the siren song of cheap labor only to find their ship foundering on the rocks of terrible quality control, uneven and unreliable infrastructure, rapacious government officials, unstable regimes, horrible customer service, and endless export and treaty problems. These are the hidden costs of outsourcing, and they can be huge, even ruinous. We don't hear about them much because "new widget factory opens in Pacoima" is nowhere near as sexy a headline as "little brown people steal jobs from the US." Even worse, the fact that the new widget factory probably won't be a union shop means a tightly organized force will be actively working against anyone ever hearing about the possibility.
In this particular case, not only do I think it will work, I think it will work well. Tech sector jobs in places like Virginia, California, and Washington state are located in places with spectacular costs of living. I can buy a house twice as big as mine for half the price in Arkansas, and that's only the beginning. From cars to crackers and asparagus to zucchini, nearly everything is cheaper in the South.
It won't just be people moving there either. A strong work ethic and a deep suspicion of organized labor equal a work force that will be and stay at the top of the heap in productivity and efficiency. And these aren't McJobs either... they're good, well-paying, solid work for anyone with the brains and the will to learn them.
I always wondered what, if anything, would become of the sad little shuttered factories that dot my old home town of Dumas, Arkansas (pop. 5800) like dried tree stumps in an empty field. I couldn't be more thrilled if, fifteen years from now, they were replaced by clean, efficient tech centers.
None of this would be possible without free markets and free trade. The rich upper-middle-class "haves" would ensure no government program would ever threaten their cushy jobs, no matter how many "have-not" lower-class single mothers would be helped out of trailer parks half way across the country. Companies having no incentive to take the risk or pay the expense of training a new work force would never even dream of moving anywhere else. Without the ability to charge a price she considered fair Ms. White would have no reason to even think of a program like this, and no government official in Washington DC could ever hope to determine that price for her.
No, markets are not pretty. They're not always fair. But they work. People will lose, but people will also win. Rigging the game with technocratic barriers, doing things like "putting the environment and labor first", or raising taxes on people who know how to make money to give it to people who don't, just keep folks from even trying.