Aces High Bulletin Board
General Forums => The O' Club => Topic started by: Ripsnort on January 26, 2004, 08:40:13 AM
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India attacks US on plan to ban outsourcing
By Khozem Merchant in Mumbai
Published: January 25 2004 19:11 | Last Updated: January 25 2004 19:11
India's technology industry has attacked proposed new US legislation that bans the outsourcing of federal work to low cost countries arguing it is a protectionist measure contrary to the spirit of free trade.
The move by the US Senate coincides with decisions by a number of foreign companies to halt further outsourcing to India because of a new domestic tax ruling that would enable the Indian government to tax part of their worldwide earnings.
The US bill, which was passed by the Senate of Friday but has still to be signed by President George W. Bush before it becomes law, is the most significant attempt to stop outsourcing, a fast-growing industry trend that has led to the loss of thousands of highly-paid technology jobs in the US and become a hot political issue in a US election year.
Although US federal contracts account for only 2 per cent of India's IT earnings, the bill sends a worrying message to the Indian outsourcing industry, which has been lobbying hard to stave off protectionism.
Arun Shourie, Indian's information technology minister, said the bill damaged the outlook for talks on freer multilateral trade. Kiran Karnik, president of Nasscom, the umbrella body for Indian IT, said he "hoped wiser counsel would prevail" before the law was enacted.
The revenues from India's technology industry are forecast to expand by a third to $15.5bn in the year to March, with two-thirds of the growth coming from the US, as more companies in North America and elsewhere leverage India's high IT skills and low costs.
But US companies such as JP Morgan and General Electric, which have outsourced thousands of jobs to India, could be casualties of the controversial rule on the taxable status of foreign companies' outsourced units. This week Nasscom said three unidentified foreign companies with back office operations in India had frozen future outsourcing until "there was clarity".
The government circular, which is binding on the tax-collecting authorities, says a foreign company's global income would be taxable under India's double-tax treaties if that company's outsourced unit in India carries out "core revenue-generating activities." Non-core activities conducted at arm's length and at fair market value would be exempt.
Accountants say the ruling introduces artificial distinctions between core and non-core work. "This raises technical ambiguities that could lead to litigation," said one tax expert.
Experts say an accepted principle of global accounting norms is that double-tax treaties override domestic tax regulations. Foreign companies could therefore appeal to double tax pacts, which prevent the imposition of taxes from different countries on the same business, to circumvent the circular.
Nasscom has protested to the Indian government, arguing the measure is contrary to the government's tax-friendly stance towards a nascent, job-creating industry.
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Maybe we should consult with the UN?
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As some of you know, I left government service and am now working for one of the worlds largest financial institutions. I am involved with my company's offshore outsourcing initiative. I have no doubt, based on the success of a pilot project, that upwards of 80% of our IT and customer service employees in the US are at risk of having their positions outsourced offshore. Our company has a target already set for the number of positions to be outsourced for FY04-05. The bids from the offshore service providers are in, and the savings are huge.
I'm not at a level in my organization where I can stop this...and quite honestly, my job is to help the company lower costs and run more efficiently...and offshoring will certainly help the company lower costs, so I'm not sure what arguments I could use anyway.
But, I can give some folks things to contact their US congressional team about. Identity theft seems to be a major concern for many when dealing with financial info. Right now, if a US employee of a financial institution uses your personal info improperly, then they have committed a crime for which US authorities can prosecute.
If Hajji in New Deli decides that he is tired of his $7k a year job as a customer service rep for Massive Bank of North America and takes your personal info for illegal gain of $50k, then he can run pretty much scott free. The fairly new extradition treaty between the US and India is very weak. And it would still depend on the India police to track Hajji down.
So if you want to slow offshoring down some, then ask your US legislators to support a bill that makes it illegal to export personal info to offshore service providers.
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How much 'Federal' work have we been outsourcing to India??
This is just more Ripsnort propaganda material.. This says nothing of private companys such as IBM and the like outsourcing american jobs.. Nothing more than something that 'could' happen...
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"Ripsnort Propaganda" ?? LOL! I report, you decide, dude. :)
Um, the article was quite clear its FEDERAL jobs.
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They should apply this bill to all US companies.
outsourcing support, customer service and IT **** to india, is just like a Burger king sticking an indian guy who does not speak english very well on the drive through. It will hurt the companies in the long run cause the only benifit to this is lower cost.
Customers HATE it.
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we'll never see in our lifetime Bush signing any such bill Gtora.. I wish i were wrong, but that would be our president representing the people and not big business.. It simply wont happen...
I hope your right in your thinking that it will hurt the US companys sending american jobs abroad.. As if any americans will reap the benefits of these companys saving money.. Perhaps newer and better companies will be able to rise up and replace the unsupporting american firms forgeting their alegence(sp)...
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In terms of the costs and advantages of moving customer support to india there is some debate. But of business system development and operations there is no debate. The costs are so much smaller and the quality of the developers so high that you see the exodus that we have seen of large developement work going to india. Bank systems, Airline systems, goverment systems.
That is why the Indians want to tax some of these operations. An airlines whole booking and reservation and air miles systems could (do) reside in India, phone support is in india, booking agents. the whole deal. Well since those booking systems are often one of the most valuable comodities the company has where does the airline exist? Why shoudnt it pay Indian income tax?
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I had to deal with this just last night.....20 minutes on hold for a guy that spoke broken english that couldnt answer my question.
Kappa lighten up man...it said clearly in the story that the number was 2% hardly propaganda compared to this
we'll never see in our lifetime Bush signing any such bill Gtora.. I wish i were wrong, but that would be our president representing the people and not big business.. It simply wont happen...
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I would have not considered it as such had the thread title been 'Federal jobs'... Otherwise it painted the picture that Bush was actually fighting for american jobs... Not that Bush is 100% responsible for american jobs being sent overseas, hes not standing in the way either... Posting this thread is meant to show Bush in a kind light, but infact, this will not help the real problem..
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Originally posted by kappa
I would have not considered it as such had the thread title been 'Federal jobs'... Otherwise it painted the picture that Bush was actually fighting for american jobs... Not that Bush is 100% responsible for american jobs being sent overseas, hes not standing in the way either... Posting this thread is meant to show Bush in a kind light, but infact, this will not help the real problem..
since when are federal jobs not AMERICAN jobs?
its not like he can tell business not to send work overseas...the only thing he could do to limit that would be incentives an such.....but than people like you would just see him catoring to big business.
IMO its a start and a welcome one!
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Originally posted by kappa
I would have not considered it as such had the thread title been 'Federal jobs'... Otherwise it painted the picture that Bush was actually fighting for american jobs...
Well then be consistent Golly-geemit, theres a million threads with misleading subjects, get to work!
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Originally posted by Ripsnort
Well then be consistent Golly-geemit, theres a million threads with misleading subjects, get to work!
LoL well, im sure I'd prolly be responsible for a few.. But w/ your 13 Thousand post... LoL nevermind...
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Federal work = federal tax money = federal taxpayers = federal taxpayers should be doing the work.
Plus, from a national defense perspective, its a good idea to keep the work within the border.
Funny how it only mentions IT work, though.
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Originally posted by GtoRA2
They should apply this bill to all US companies.
outsourcing support, customer service and IT **** to india, is just like a Burger king sticking an indian guy who does not speak english very well on the drive through. It will hurt the companies in the long run cause the only benifit to this is lower cost.
Customers HATE it.
Are you a communist?
Stock holders own the corporations and it's their right to get best revenue for the money they invested.
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Originally posted by Gunslinger
since when are federal jobs not AMERICAN jobs?
its not like he can tell business not to send work overseas...the only thing he could do to limit that would be incentives an such.....but than people like you would just see him catoring to big business.
IMO its a start and a welcome one!
Right on:)
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Originally posted by Saurdaukar
Maybe we should consult with the UN?
may be WTO ?
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A drop in the bucket.
Let us know when the US stops the outsourcing of jobs by private companies like Dell, etc. Now THAT would really mean something to the US worker who has seen his or her job disappear out of the country.
yowser
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Staga
I am far from a commy.
I think this will hurt companies on the long run, hell Dell just pulled support for the corperate systems sales back into the US becuase the service was so poor they where losing sales.
Regular Joe consumer is not that lucky with Dell yet.
I want jobs in America protected from cheap unskilled labor in third world nations, I fail to see how that it a comunist Idea.
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You cant really stop companys from outsourceing. Unless the people of this country start boycotting companys like dell or delta, they will continue to outsource.
They can however punish companys that do this through taxes.
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Originally posted by GtoRA2
I want jobs in America protected from cheap unskilled labor in third world nations, I fail to see how that it a comunist Idea.
That is a socialist idea for sure though. Capitalism is letting these corporations do whatever they like with no government interference.
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Froggy
Yeah you can stop them hell pass this bill for everyone not just the feds. It will never happen.... but it could...
It may be a borderline socialist idea, but we have that that in our lives everyday. The gov sets rules for corps all the time.
This would help the job market in the US alot, and customer would get better service.
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When American farmers grow stuff at such low price that they undercut other nations and they complain about it - what do we say ? "f--k them, we can do it better and cheaper then those handsomehunkes".
When Indian programmer can do same as US programmer but cheapter, we're "protecting our workers" ?
You can't be for free trade only when it benefits you gents. One way or the other.
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"You can't be for free trade only when it benefits you gents. One way or the other."
Sure you can. It may not be right. But then imho nether is sending all of our non survice jobs over seas.
Think soon you will need a college degree to work at a drivethrew. Becasue all the rest of the jobs will be in india.
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Stop whining and develope the next emergent technology or industry and lead the world, instead of whining about the job you had stapling paper together for $45 an hour that mysteriously went to India where a triple doctorate is doing the same job for $5 an hour.
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isnt the fed gov. the biggest employer in the US? 2% could very well be like 30% of what private companies employ.
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Great to see the small-government laissez-faire party promoting free trade. :rolleyes:
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Finally, a Leftie speaks the truth. If you all will take a peek out your window, you may catch a glimpse of a pig flying:
Quote:
"They can however punish companys that do this through taxes."
Taxes = Punishment. We always knew what the Leftist motivation was for shaking-down the productive members of society . They just wouldn't admit it.....
C.
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Originally posted by Cabby44
Taxes = Punishment. We always knew what the Leftist motivation was for shaking-down the productive members of society . They just wouldn't admit it.....
C.
Oh yeah, forcing a company like Microsoft to keep jobs here by closing tax loopholes when they paid less than 2% in taxes on some 25 Billion in profits last year is a real shakedown.
Some of the major corps. are using these loopholes to pay what should be considered as less than what should be owed is common. Worse yet, some companies get tax credits making their tax burden less than 0%...and they still outsource to offshore labor.
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Originally posted by MrLars
Oh yeah, forcing a company like Microsoft to keep jobs here by closing tax loopholes when they paid less than 2% in taxes on some 25 Billion in profits last year is a real shakedown.
Some of the major corps. are using these loopholes to pay what should be considered as less than what should be owed is common. Worse yet, some companies get tax credits making their tax burden less than 0%...and they still outsource to offshore labor.
I cant recall a single tax incentive that has been enacted that rewards a single company to keep american labor?????????????
and as i said befor if the current administration were to pass such an act it would be more libral ammo that he cators to big business!
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Originally posted by Yeager
Stop whining and develope the next emergent technology or industry and lead the world, instead of whining about the job you had stapling paper together for $45 an hour that mysteriously went to India where a triple doctorate is doing the same job for $5 an hour.
Ever worked on a 500- 600 user business application Yeager?
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Yeager obviously thinks his job at McDonald's is safe. Thus his uncaring attitude.
yowser
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They dont pay enough in taxes to get them to stay here. Its cheaper for them to outsource then it is for them to pay americans even if you slash their taxes.
Then the federal government loses funds and you enter a spiral.
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I hope Bush does sign the Bill. It would be the best decision he makes as the president for the country. IMO
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Originally posted by OIO
isnt the fed gov. the biggest employer in the US? 2% could very well be like 30% of what private companies employ.
Not when you tally up all of the private companies into one big total.
-SW
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A person must adapt. Americans have some sort of reputation at overcoming adversity, creating and leading free markets, but it would appear the ever longing line forming to suck at the governments tit has finally squashed that trait.
It would appear that some would rather develope and cement a theory of dependance on government instead of using self reliance, discipline and ingenuity to overcome adversity in a free flowing global marketplace. If a person in India can outbid and develope competative products then Im afraid american global supremecy of free market is at an end. Methinks we can finally give north american liberalism, a watered down form of european socialism, it's due credit.
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Originally posted by Gunslinger
I cant recall a single tax incentive that has been enacted that rewards a single company to keep american labor?????????????
and as i said befor if the current administration were to pass such an act it would be more libral ammo that he cators to big business!
You'll be voting for Kerry then?
"To create new manufacturing jobs Kerry will provide new tax breaks to manufacturers who produce goods and create jobs in the United States. He will provide relief for manufacturers that provide quality health care and retirement."
http://www.johnkerry.com/issues/economy/
But then he's going to tax the bejeasious out of you to give them extra bonus cash.
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Something to consider, if the Dems can convince the voting population that the election is about “jobs”, be it Kerry or the Anti-Christ. You may well see a replay of 92. Both Iraq and terrorism will play a large role in the election. But, if Joe Blow feels his principal concern is feeding and keeping a roof over his family heads. Then I'd say, all bets are off.
Don't think tax breaks will be much of an inducement. Going to take alot more than that.
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Originally posted by kappa
LoL well, im sure I'd prolly be responsible for a few.. But w/ your 13 Thousand post... LoL nevermind...
lol 13,000 posts, say 3 minutes on average per post is 39,000 minutes or 650 hours, say Mr Snort works for $36.00 per hour his posting on the BBS during office hours costs his company $23,400.
Wonder why jobs get shipped to the 3rd world?
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I think it's up to us, the consumers, to decide what does and does not get outsourced by using or not using a company's product(s). Most people think that the corporations are so big that they don't care about one customer. One customer has no power, yes. Customers in numbers have power. That's what ost people fail to realize.
Look at Dell. Enough corporate customers complained, and tech support is back in the US. If enough people stop buying Dell products and name the poor outsourced tech support as the reason you can bet it will be back in the US.
Regular consumers have the same power in large numbers. That applies to all companies for pretty much any aspect. As long as we put up with what we don't like and pay for products and services anyway, the businesses will not change, no matter how much we compain. Why should they? They are in it to make a profit. As long as you are forking out the cash, nobody cares whether you are happy or not. Look at the software industry. Everyday there is software released that doesn't belong on the shelf, with promises of patches in the future. And people pay for it. And since there is not enough consumers making a stand and refusing to pay for an unfinished product, it doesn't cut into the company's profit and nothing changes.
It is up to us to make an informed decision whether to do business with a particular company and hope that enough people will make the same choice to force a change.
Now back to the topic of this thread ... government jobs. Those should be kept here, period. Otherwise we might as well outsource our President and Congress, pour the savings into our education system, and raise job candidates that can compete with the ones abroad.
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Originally posted by _Schadenfreude_
lol 13,000 posts, say 3 minutes on average per post is 39,000 minutes or 650 hours, say Mr Snort works for $36.00 per hour his posting on the BBS during office hours costs his company $23,400.
Wonder why jobs get shipped to the 3rd world?
That's 13,000 posts over 4 years, which comes out to about 37 mins of posting time a day, assuming he only posts on working days. I think it's safe to say he does it during his lunch break :D
Now, if it was 13,000 posts over the past 6 months, THEN I'd have to wonder :lol
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"If Hajji in New Deli decides that he is tired of his $7k a year job as a customer service rep for Massive Bank of North America and takes your personal info for illegal gain of $50k, then he can run pretty much scott free. The fairly new extradition treaty between the US and India is very weak. And it would still depend on the India police to track Hajji down.
So if you want to slow offshoring down some, then ask your US legislators to support a bill that makes it illegal to export personal info to offshore service providers."
Good point! My company tried out sourcing and it failed. Communications infrastrure in India sucked. Our operating hours were their maintenance hours.
We had customers refuse to talk to "Indiots."
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Waaa... so much for a free market and you call Canada a socialist state, LaRf.:rofl :rofl :rofl
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"like a Burger king sticking an indian guy who does not speak english very well on the drive through."
Who cares who's at the "customer service desk" as long as the college educated, minimum wage, no-collar Americans inside the newspeak "factory" are still employed. And that masses of over qualified Yanks are continually trained in the high-dreck skill of "manufacturing" hand rubbed, finely laquered* ground beef patties and the requisite "freedom" fries.
*luxury appointments such as inlaid sesame seeds or gemstone finish pickle appliques strictly optional!
(like Toad said, welcome to the new world economy....)
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Nothing can be done about private corporations who outsource.
Indeed, Since many of these American mega-corporations pay zero corporate income tax, rather than tax incentives, why not more punitive threats?.. If you outsource more than 50% of your work force, you can pay the full premium.
Another option:.. Just how valuable are these copywrites? The logos.. source codes etc.. Again, if 50% of your work force is shipped out, no more copywrite protections..
Option three: (my favorite) If you company is outsourcing more than 50%. Expulsion. That’s right, corporations are not people, they can be expelled. Let them be at the mercy of the host countries tax laws.
Some pretty strong medicine I agree but these people are IMHO committing treason.
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Heinz has 27 overseas plants.
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I like most of what Bush does.
But some things are some of the stupidest things I've ever seen done before in a presidency.
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Originally posted by GtoRA2
I think this will hurt companies on the long run, hell Dell just pulled support for the corperate systems sales back into the US becuase the service was so poor they where losing sales.
Regular Joe consumer is not that lucky with Dell yet.
Been there, done that. I called up Dell because I needed a new monitor and I love their warranty. Unfortunately, I get this gimp who fails to understand basic English, and his supervisor kept saying "question! question! question!" when all I wanted was a price quote! Until Dell hauls their sales/support back to the US, there ain't no way I'm buying from them again. I'll go through a local shop, even if their warranty stinks and I gotta carry ten dead CRT's back through the door. At least they speak English.
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