US healthcare bill passed. Is outsourcing Obama’s next target?

30th March, 2010 - Posted by Rob - No Comments

The US House of Representatives have just passed the landmark healthcare legislation by a vote of 219 to 212. This is yet another feather in Obama’s cap, which has already been decorated with many embellishments including a Nobel Prize. Good job, Obama! It’s a domestic victory for Obama, which makes us wonder whether Obama’s next focus will be on the international scene. Will he train his guns on his love-to-hate topic ‘outsourcing’?

Outsourcing has always been a part of Obama’s rhetoric from his ‘Yes we can’ presidential campaign days. On the campaign trail back in 2008, Obama spoke against outsourcing of jobs and talked about putting an end to this trend.

Since then, there has been a steady stream of statements against outsourcing with a little sprinkling of Bangalore or India, now and then. Most of these issues were quite obviously addressed before a domestic audience. Obama further renewed his promise to curb outsourcing of jobs in his first state of the union address where he went on to say that it is time to finally slash the tax breaks for companies that ship jobs overseas and give those tax breaks to companies that create jobs in USA. He further announced tax incentives for training U.S citizens.

The Healthcare bill, despite its obvious flaws, has surely earned President Obama some brownie points in the domestic arena. If Obama decides to focus on outsourcing to further strengthen his position at home base, he needs to think on these lines as well. One, America’s protectionism is not great for a globalized economy. Secondly, American companies will struggle to find cost-effective, skilled manpower, such as those found in India and China within their home turf. Finally, if US has to make its own software, set up its own BPO and manufacture its own toys, the production costs would be three-fold of what it is in India and China. So, the American public may end up paying a lot more. This in turn would create a situation where people are unhappy with the government.

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