November 28, 2003

Technology vs. offshore outsourcing ("Jobs come and go")

[I wrote this in reply to the message "Jobs come and go" today on Dave Farber's IP list, but it apparently didn't make the cut]

> [Walter E. Williams]
> But there's no significant economic difference between an industry
> using technology to reduce production costs and using cheaper labor
> to do the same.

Ah, but there is - by this logic, there's no difference between using robots and slaves. The fallacy thus should be obvious. The difference is that the robots aren't also part of the economy. By "economic", he means there is no economic difference to the industry management. Which is not the same as there being no economic difference to the industry labor force.

The argument for technology is that ultimately, it expands the economic pie (since the robots don't count as participants). This is not the same as simply playing labor off against each other, which is merely fighting over the portion of the pie (unless you also think that workers don't count as participants, a view many people do have!).

Slave labor is unarguably a cheaper method of production. But it does not follow then that society benefits from it.

By Seth Finkelstein | posted in politics | on November 28, 2003 11:57 PM (Infothought permalink) | Followups
Seth Finkelstein's Infothought blog (Wikipedia, Google, censorware, and an inside view of net-politics) - Syndicate site (subscribe, RSS)

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