Why Barack Obama is against Outsourcing
74 It was a bad day for Indian outsourcing services firms, When Barack Obama Declared a Bill on Tax Increase on Outsourcing. It will be introduced to congress and if it get passed the economy will be in danger again.
Obama Speaking
What is the Bill?
"Obama has proposed to tax expenditure by US companies on availing services from outside the country from 2011. The move has been proposed to discourage outsourcing and contain the flight of jobs to other countries. Payments by US companies for services outsourced to India or other countries are treated as normal expenditure and deducted from the company's revenue at present. They are not required to pay tax on that amount. " That's the case,If a company is having expense on a process near 70-80 $ it can be done in just 10-15$ when outsourced. Also the on outsourcing money company doesn't required to pay tax. But now onwards they will be paying Tax on the outsourcing money.
Why outsourcing got popular in india and other countries?
15 years back average in com of a normal Indian person was 4-5k. And sudden boom came and lots of job came in the market for BPO and outsourced work. The salary was 10-15k sometimes more than that. And the skills required was a simple graduation. Why it wont get popular then?Many youths dream was BPO for easy money. And People start thinking BPO as a career view.
What is current condition in India and other countries?
Currently a major percentage of Indian IT market is dependent on US outsourced jobs. In the recession period also the BPO industry is having golden age. And peoples are feared due to the Bill news. Because getting a job is very difficult.
The Good and Bad
Whats Bad for India?
Indian will loose a big share of outsourcing in com. Many people will become Job-Less. Recession didn't affected Indian market that much as America. It will affect more now.
Whats good for India?
Indian market will loose its dependency on American market.Indian Market will reduce two types of dependencies Direct and Indirect and it will give Indian currency the strength. It will loose some share but, will gain more strength in due time. Indian market will expand more in European and other countries. And soon recession hit will be more milder for Indian market.
Whats Good for America?
Jobs will be increased as more firm will stop/reduce outsourcing and look for American peoples more. Money will be back in American market and will help it to sustain recession. American Economy will get strength soon.Expenditure of American market will increase.
Whats Bad for America?
As company cost will increase for a product(As they will start doing their work in America) it will directed towards American peoples at the end. Many companies may stop production or some services due to increased cost. And cost of consumer goods and various services will increase and will affect living of American Peoples.
Whats the Barak Obamas Thinking?
I will not say Obama is wrong. He is right. In the time of recession jobs should be in America rather than other countries. As a president he cares for America and he is very well in that thing. His motivation is very clear to help American Peoples in bad conditions.
But at the same time, it will affect American Market also due to increased costs. He have to consider this point also and then act. Lets see what happenes if the Bill get sanctioned.
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Interesting hub, thank you.
A few years ago..actually, more like almost half a decade ago there used to be a channel called TechTV. One of their specials followed a group of Indian's learning how to become either a Canadian, American, or British person to answer the phones.
It was complete total culture immersion...all for a better life, even if they weren't living their country. You guys are very hard workers!
G|M
Thanks G|M for visiting. I didnt know about this. Well i still think 1999-2000 is just like last year. And then i realise its 2009 we have come so far from old culture. Here also its changed a lot. We are more going towards easy money than claiming it by hard work.
Protectionist measures never work as expected and always backfire. Yet people resort to them all the time...
After all politicians are same everywhere.
Taxing outsorcing is a protectionist measure, designed to protect local market from foreign competition. Anything that harms competition leads to lower quality and higher prices :)
However, such measures are usually supported by population, due to the lack of understanding of how things work...
true. i m agree with you misha.
Very interesting hub, especially as it is written in English. I will watch what happens with interest, thnx
I am also having an eye on the bill.
The truth is Obama is going to tax everything. He has to in order to pay for his massive spending bills. This is just the start. They have the cap and trade bill working it's way through congress. He is raising taxes on the higher income, and more.
The saying to preserve jobs is not even part of the process, it justs sounds good to the media and pleases the masses. They eating it up and in the mean while why they are being sidetracked on this, their taxes are being increased on them and they are not realizing it.
Oh, and MIsha, sound like you becoming Republican, LOL!
Keep on hubbing.
LOL Ed, I always was closer to original Republican ideology, and never really tried to hide it :) Well, always means last dozen years or so LOL...
The sad thing is that nowadays Republicans are too far from the original...
You are fast Misha,
Do you live on hubpages. Get a Life!, (Just Kidding!)
Keep on Hubbing!
LOL even faster this time :P
Sometimes I wonder myself if I have a life :D
This whole outsourcing buisness was such a big issue during the elctions last time round. Indians hated the thought of the ketchup King coming to power as he promised to slash it. Now obama is going to do it. Let's see how the market recovers.
I worked for Microsoft who outsourced calls for computer service to India. One of the representatives for India visited the site in the United States and told of programs of educating graduate students in India that was not a part of the program here. I am not getting off topic here. My point is that it is a good thing when outsourcing is reduced and the jobs are kept where the home office is located. Indians are now using American money to educate their employees who are allowed to take the courses while at work in India but the Americans here do not have such a program. Instead calls were constantly received from Americans who did not appreciated having to learn a foreign language to get computer service.
Its a true thing. As the recession is on Americal Govt also in need of more money and so taxes will increase definatlly.
Another question. I have seen many peoples working in call center and on calls the peoples from other countries or host country just bark on call center guy. Do you think an american can accept this thing?
Worked for the big guys, Merrill, Bank of America, etc. They started to outsource all of the graphic depts and copy proposals - Hundreds of jobs - yet they still kept getting major, major tax breaks to stay in NYC to "keep the jobs here" what a joke. It's time that if they claim to be American Companies and their headquarters are here in America, then pay up like the rest of us and keep those jobs here. Oh, I forgot, Merrill was bought by BofA and they all got bailouts and laid off thousands. I won't buy Dell products because of the outsourcing, yet if I call Sprint, I'm sometimes talking to Canada.
I think Obama is trying to do what is best for the Americans.
Yes he is doing good for america. But it also have some negative effects.
What does BPO mean?
BPO=Call center(Business Process OutSourcing)
Thanks
indians are already going down these days with racial attaks increasing at high pace al of a sudden in austaralia and canada and now they losing their job in america aswell.i think obama acting anti india something india dis never expected .indians were so very happy his ways now sound very cunning ...and depressing...what you ay is it not??
The measure of stopping outsourcing will just have shorterm relief, in the form of positive sentiments among the people of US. But this will take a dangerous turn if Developing countries start reciprocating to make good the loss of jobs. They may in turn start, encouraging creation of jobs and stop imports from developed countries such as US, Canada etc, to encourage domestic industries. This will, in turn affect the consumer goods industries in US. So in effect it will be a lose-lose situation.
The Positive effect will be again in favor of developing nations as it will encourage indigenous production and technology. Big technology companies like IBM, Microsoft will move out and with that their loss of business. Their places will be taken up by Domestic companies.
Lastly it is very Ironic that US take the road of Socialism while the entire world is tilting towards Captalism with a pinch of Socialism.
It is a troubling question and both sides have their point. I must say that Brainbuster is a bit off. Capitalism with a pinch of Socialism seems like a good mix, otherwise Capitolism gets too big, the companies too large. It was the too big to fail overblown corporations that started all this mess. America is run by large corporations, the government oursources a lot of government work to private, for profits companies.
The world is flat.
There is nothing to worry for Indians... as few American companies had done research and found that the increment in cost due to heavy tax imposed on outsourcing is still lesser than benefits earned because of outsourcing.
so big companies will cont to outsource their jobs to countries like India, China, Philis, etc
Re: Why Barack Obama is against oursourcing
Obama is proposing the subject tax as a way to payoff unions, particularly the SEIU. If companies that outsource services are forced return to domestic operations,that will increase union coffers, as well as donations to the Obama regime. Do not forget what effect the unions had on General Motors (now Government Motors). All "stimulus" activity by the Obama regime, without exception, has involved money and power exchanges.
I don't think the average American knows the true level of Business outsourcing. From manufacturing to newspaper editing and beyond. Wake up to reality Americas. Big business is anti social. If you are a capitalist you shouldn't have a problem with this. Your motto is "adapt and change", Get educated, open a business. Stay ahead of the curve or fall in with the beggars as Limbah would say.
I remember seeing a program on the "Made in America" tag fiasco over 10 yrs ago. Companies in China were given "made in America" tags to sew onto garments being made for American department stores. While at the same time they were cowing you into being proud Americans and support "Made in America".
The NWO was supposed to encourage globalization and business is doing just that. They just haven't let the average fist pumping red blooded American know the agenda. Did anyone see Slum Dog Millionaire? Most of the people that handle customer service for companies in the west are Indians in Mumbai thanks to improved worldwide telecom, the Internet and soaring education rates. Companies would rather pay workers over there $100 per week instead of $1000wk here for the same work. More money in their pockets. I don't blame them for being smart. A resourceful capitalist would find ways to capitalize on the changing situation. Then again maybe most of us who like the ides of capitalism only like it when it benefits us.
Good Hub filled with reasonable conclusions. I enjoyed it, and the comments.
For decades America has practiced "capitalism for the poor and socialism for the rich." Most Americans have NO understanding of economics or economic systems and are constantly manipulated by politicians and media outlets run by multi-national corporations. The dumbest thing is that while most Americans would say they are capitalists...they themselves own no capital. They hear that "Protectionist measures never work as expected and always backfire. Yet people resort to them all the time," and actually believe it to be true--despite the fact that they are given no supporting evidence to the contrary. Tell that to Venezuela and China. They seem to be doing just fine with their "protectionist measures."
Thanks Again.
I'm one of those few republicans for protectionism. Having said that, I am not against globalization. The problem is that globalization only works when both sides benefit. At present, the American worker is being cast aside as insignificant by it. Right now you can argue all day that I get a lower price because some Indian worker gets my job. I say I HAVE to pay a lower price because either I've had to change careers or I don't have a job at all. The fact is I can't afford anything else but a lower price.
We've already given away some of the best benefited, highest paying jobs in this country when we gave up our factory jobs. We've given away enough I think. The fact is factory jobs are and were some of the best paying jobs in America. The average salary for a factory worker is about $54,000, and that's without a college degree. Office workers with degrees typically make less. Service workers in general make far less. And guess what? We said we WANTED to be a service oriented economy. Now we are primarily. And so people enter the service sector and those jobs go out of the country. What are we going to be left to do in this country? Flip burgers?
I feel for the issues facing India. But here's the catch. Where's your product? Where's your innovation? Where's your government stepping in to foster and utlize India's own resources? Where are your entrepeneurs?
In America, social programs outlayed by the government are frowned upon by hard working, risk-taking taxpayers. Outsourcing to help India at the expense of American workers is corporate socialism and just as bad.
America should give up it's jobs because India can't get it together? Besides, Indian outcourced customer service is nothing to write home about. It's lousy service at best and makes Americans feel like companies care less, not more, about the value of the dollars they spend utilizing the services these companies provide. I don't mean to be disparaging, I'm just being honest here.
As a customer I don't like poor customer service and I certainly don't like the cold shoulder feeling I get from such companies.
If India, or any other country for that matter wants to improve their bottom line and improve the lives of their people, why not take a page out of the history of America? We've been here for a very short 234 years in comparison to the age of most other countries, and we seem to have gotten it right. Don't take our jobs. Take a lesson from our successes and copy it. Then we can trade all day...
And we'll BOTH keep our jobs.
fffffffffffffff
hey thanx for posting your article.....
i really want to know this from u n plz answer my querie...
as we all know Mr. Barack Obama is against outsourcing...so what will be the effect on software companies in today's date...????
hey thanx for posting your article.....
i really want to know this from u n plz answer my querie...
as we all know Mr. Barack Obama is against outsourcing...so what will be the effect on software companies in today's date...????
Myself - never had been a huge fan of outsourcing, but as an accountant I completely understand the executives of companies doing this to improve shareholder wealth.
What I am really not liking is ConocoPhillips US forcing the move of accounting positions for ConocoPhillips CANADA to Bartlesville. I know those in OK like the new jobs; but this is not good for the Canadian economy & has a huge trickledown effect in Calgary, Alberta.
I certainly hope the Canadian government will introduce taxing like what I read above to keep jobs in Canada.
Note I am not an accountant with ConocoPhillips Canada; but when there is news of 300 specific positions being eliminated in one city - this causes a large drain on the city & government.
Now I understand those in the city of Bartlesville will be glad for the influx of jobs; I just do not see this as something that is right.
i love this:
Whats the Barak Obamas Thinking?
I will not say Obama is wrong. He is right. In the time of recession jobs should be in America rather than other countries. As a president he cares for America and he is very well in that thing. His motivation is very clear to help American Peoples in bad conditions.
But at the same time, it will affect American Market also due to increased costs. He have to consider this point also and then act. Lets see what happenes if the Bill get sanctioned.
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Yes, he is doing what is best for America, but he never thought of the impact to business owners.
am also a certified CC employee..well, let's just wait and see...
i don't think this will be possible within 5 years, so let's just prepare.
![The Stimulus Can Giveth and the Budget Cut Can Taketh Away [48]](http://s3.hubimg.com/u/4678146_50.jpg "The Stimulus Can Giveth and the Budget Cut Can Taketh Away [48]")
aniketgore Hub Author 3 years ago
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