Saturday, June 16, 2007

Outsourcing Legal Jobs

It’s being done with customer and technical support services, software development, engineering, and even the reading of X-rays and MRIs.

And now a Florida Bar member wants to know if it is ethical to outsource legal research to India. The Bar’s Professional Ethics Committee will take up the issue when it meets June 29 at the Annual Convention in Orlando.

So begins a front page article by Senior Editor Gary Blankenship in the June 15, 2007 edition of "The Florida Bar News", which is the official newspaper of the Florida Bar. Frankly, I don't believe that outsourcing should necessarily be "unethical", but maybe it ought to be unpatriotic. Yes, I know that we're capitalists and outsourcing is good capitalism at work and capitalism is what makes us perhaps the greatest economy in the world. But I still can't help but worry about where this is taking us. I've mentioned before that I'm concerned we're becoming a nation of "haves" and "have nots" where the "haves" control the outsourced goods and services and the rest of us buy from them. As one wag put it (possibly John C. Dvorak on the TWiT podcast), outsourcing makes millionaires into billionaires. And that's what bothers me --- is outsourcing driven by short-term greed? Will all the displaced lawyers and paralegals really find "better work" elsewhere? After all these are well paid office jobs and not factory jobs.

Large law firms are most likely to embrace outsourcing. Partners at those firms already earn substantial six figure salaries. Their newest lawyers start at or near six figures in some cases. They've bid up starting salaries to silly levels by insisting on chasing the same handful of lawyers, which is the top ten percent of the class at certain schools. Outsourcing would allow them to leverage those high priced young lawyers even more. Thus, they could move from six figures to seven figures. But at what price to America?

I recently questioned a friend about the wisdom of his daughter's decision to become a radiologist. I wondered whether she had considered the fact that radiology was increasingly outsourced. He advised that he had already had that same discussion with her. It is tempting to think that the answer would be to become a surgeon. After all, doesn't someone have to physically stand at the table and do the cutting? Not anymore! You may have read about telesurgery performed via robot. This is touted as increasing the precision of the surgeon who uses the steady and tiny robotic limbs to perform surgery. It can also be done remotely. Surgeries have already been performed where the surgeon was on a different continent from the patient. How long then until the surgeon stands in Calcutta, Rio de Janeiro or Beijing while the patient lies on a table in Tijuana or Nassau? Surgical tourism is already burgeoning. I picked locations outside the U.S. on the assumption that the AMA's lobbyists will prevent this from being done in the U.S. unless, of course, the doctors who run the AMA think they'll make more money and too bad for the new doctors. Certainly hospitals would love the idea.

In Episode 100 of the TWiT podcast they bemoaned the decline in students majoring in computer science. I think John C. Dvorak nailed the reason when he opined that there was no incentive to major in computer science in the U.S. when all the jobs were being outsourced to India. You'd have to be nuts. How many times have you heard of programmers, computer designers, and technical support employees being laid off because their jobs were outsourced? How many times do you have to read that before you get a clue and major in something else?

They also discussed H-1B visas and the push to get more of them approved. Large computer companies whine and moan that the they can't get enough skilled employees so they need to import workers from India, which is what the H-1B visa program let's them do. The fact that an imported engineer thinks he's getting rich on half the money doesn't have anything to do with their desire to import him though. Of course not! This is a use of legal immigration to depress wages just as illegal immigration does the same. Big businesses love of illegal immigration has a lot more to do with a love of cheap labor than it does a love of America's immigrant heritage. Milton Friedman the free market, libertarian economist derides H-1B visas as a government subsidy to IT companies. It is a way for the government to supply lower wage non-U.S. workers to industry. Thus, huge CEO salaries are subsidized at the expense of citizen workers.

As much as I love capitalism and love to think that a rising tide raises all boats, I'm not sure that I can embrace this trend. If you/'re young and worried about your own future, I guess the best thing you can do is find a career that requires a physical presence and can't be outsourced and buy the stock of outsourcers with any money you can save.

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