Illustration by Daniel Elchert
Three times in a recent four-day stretch, I found myself speaking with people in the Philippines about various aspects of my life.
The subject matter couldn’t have been more mundane: TV service was down, a hotel room had to be booked through a points program, and a credit-card company was acting smarmy.
As you surely know, these are the sorts of things we discuss with people in the Philippines these days, because that’s where we’re often routed when we Americans call an 800 number for one form of service or another. Perhaps we might instead find ourselves conversing with India, Singapore, or Costa Rica, but it’s all basically the same in the brave new world of outsourcing.
This is hardly a news flash, but there was something unsettling about how repeatedly I was routed thousands of miles around the world to settle tasks that might have been resolved in St. Louis—or any other American hometown—not more than a few years ago.
We have lost all sense of community.
Yes, I understand that the American Telephone and Telegraph Company (AT&T) is no more “American” today than it is about the business of delivering telegrams. And I realize that being chiseled by hotel points programs and credit-card companies comes with being a citizen of the world, not of any particular country. But continually being dispatched to Filipinos—albeit polite, well-spoken Filipinos—began to cause me to channel some dark Lou Dobbs portion of my psyche.
Seriously, though, there is no justification for resenting the Filipinos, or any other overseas employees of call centers. These people didn’t steal jobs from Americans. They simply took advantage of a new opportunity to avoid the poverty that grips so many of their countrymen.
The problem is that their countries are so poor—especially in relation to ours—that by earning starting wages of as little as $300 to $400 per month, call-center employees at once surpass their minimum wages while offering services at a fraction of ours. And that’s not counting a giant gap in benefits.
One Filipino website I found boasted of how workers there offered higher quality because there was less employee turnover. The reason: Even at a fraction of the cost, call-center jobs that represent relatively lucrative careers in the Philippines equate to dead-end or short-term jobs that people fill in the States while looking for something better for the long run.
The site did complain that universities in the Philippines were too focused on churning out call-center specialists, presumably at the expense of broader educational quality. It can’t be long before they offer classes in how to emulate a Southern twang.
There is no way American workers can compete with all this. There’s no way American workers should be expected to compete with all this. There’s no way we should want them to be able to compete with all this.
One of the main reasons we have nearly 15 million people unemployed in this country—and can’t seem to get that number down—is that so many decent-paying jobs are being outsourced in this manner. Every day.
Thanks to the technology of the new millennium, it doesn’t matter whether a call center is located next door to your house or 8,250 miles away, which is how far Manila is from St. Louis. A person sitting in either place can see whether you’re receiving a TV signal and what you are watching. And that’s just or starters.
So if you run a large corporation, and you need to provide telephone support for thousands or even millions of customers, and it costs far, far less to accomplish that task by renting dirt-cheap office space and paying a fraction of what you’d pay in America for salaries and
benefits, what do you do?
In an era in which fealty to shareholders and the almighty dollar are synonymous with “the right thing to do”—and actually “the only thing to do”—it’s a pretty easy decision. You head to paradise, a land of cheap rent and cheaper labor. You tap into a giant new market of college-educated young men and women who are being groomed for long-term careers at the call centers.
Don’t bother even raising this as an issue to a free-market capitalist. Life is all about bottom lines and rates of return and stock prices and equity. There is no place in American capitalism—or anyone else’s—for any possible consideration of what this sort of behavior means to a nation as a whole. Moral compasses are for wimps.
One St. Louis businessman I spoke to boasted about the efficiency of his firm’s outsourcing program and was incredulous that any other human factors should even begin to come into the equation. In fact, one of the things he found most insulting about America’s labor force was the notion that he be expected to provide health benefits for a 32-hour employee.
“Thirty-two hours isn’t full time,” he said.
He spoke matter-of-factly of having remedied the problem by reducing one woman’s hours to 31. But more important, he doesn’t need to be bothered at all by such trifling concerns as the healthcare of his overseas help.
I suggested that universal healthcare—Medicare for everyone—might be an answer to his concerns.
It was time to move on to something else.
As I said, we’ve lost all sense of community.
I am indeed a capitalist, an entrepreneur who has never asked for nor received a dime from government in almost 34 years of operating businesses. And I am sickened to hear this rationalizing of the inevitability—even the virtue—of outsourcing American manufacturing and service-sector jobs to countries whose workforces toil for what, by our standards, are subhuman wages.
In effect, companies are saying it’s perfectly acceptable behavior to exploit the poverty of other nations for the benefit of their shareholders, with no regard for their country’s economic health. And there’s certainly no regard for any notion of corporate responsibility to anything but the balance sheet.
You can almost hear the echoes of the arguments that pure-market capitalists made more than a century ago in defense of child labor, no mini-mum wages, sweatshop conditions, and monopolies. Hey, it’s the free-enterprise system, it’s the natural order of things, and it’s inevitable.
In fairness, America’s cap-tains of industry aren’t antigovernment: They do embrace roles for the federal bureaucracy that the Founding Fathers never imagined. They expect the government to spend taxpayer dollars to promote the nation’s products, to promote sales of military hardware everywhere, to prop up our private industry when it’s faced with government-spurred competition in places like Japan and China, and to fulfill all manner of “economic development” missions that aren’t readily found in the U.S. Constitution.
Having said all of this, I recognize that there are limits to what the federal government can do. Our government can’t outlaw outsourcing. It can’t render our companies uncompetitive to those in other nations.
But just like America did at the end of the 19th century, we can respect capitalism without letting it go so unbridled that it hurts our people. We can use our trade policy to do it, and we can use our tax code to do it.
Don’t hold your breath, of course. Even facing an election that should have hinged on employment and the economy, and even with President Barack Obama declaring the subject to be a priority, and even with substantial margins in both houses of Congress, the spectacularly inept Democratic Party couldn’t even enact a simple measure to prevent companies from deducting the expenses incurred in closing a U.S. plant and moving jobs abroad.
They couldn’t even get rid of the deductions, meaning that American taxpayers are actually subsidizing their own demise with regard to job loss. They also couldn’t eliminate numerous special tax breaks—such as deferring tax payments in overseas operations—that again
feed the beast.
They also couldn’t enact something as benign as a proposal for a two-year payroll-tax holiday on jobs repatriated to our country. These are hardly radical steps, yet not one word of such legislation made it to a vote in Congress during these times of horrible unemployment.
It’s sad that not a single Republican could find it in his or her conscience to cast a vote that would at least symbolically suggest a concern for the outsourcing problem. But had the Democrats been truly sincere about this as a priority, they would have been beating the drums every day of the session and they would have repeated it so often that Americans were sick of the issue.
Instead, the Democrats waited until the end of the session to raise the subject—a tactic Republicans rightly criticized as election-year politicking—and they articulated their position so poorly that most Americans never heard about it.
Maybe the problem is with the baby steps. Maybe people should tell just the outsourcing companies—who are all about freedom—that they’re truly on their own when they take jobs abroad.
American companies certainly expect the Department of State and the U.S. military to protect the safety of their overseas operations, regardless of whether a single American employee toils in their call center or manufacturing plant. So in the event of a coup, or some other crisis, maybe they should be told to call the authorities in the Philippines or Singapore or India if they have a problem.
“We’re sorry. Our embassy is currently assisting Americans.”
SLM co-owner RAY HARTMANN is a
panelist on KETC-TV Channel 9’s
Donnybrook, which airs Thursdays at 7 p.m.
