::Sunday, March 21, 2004::
THE COMPLEXITY OF OUTSOURCING
..It is true that outsourcing may not be entirely bad and is part of the creative destruction that the US economy will have to go through as part of an increasingly interdependent global economy. The problem is too much blind-faith that policy makers put on the benefits of outsourcing altogether. The issue is not the pain but that the pain may not go away and the medicine unavailable for quite a long period of time. Innovation is arguably still the province of the US but history is not a helpful guide in this area. The boom of the 90's and the dominance of the US economy only had Japan to worry about as a worthy opponent. Now China and India are eating at the same pie which naturally lowers the share of the US. It may not be daunting economically but politically it will have reverberations as Americans who are increasingly worried about their future economic security go to the polls this November.
