Magazine article Reason

Chipped Beef: Outsourcers against Outsourcing

Magazine article Reason

Chipped Beef: Outsourcers against Outsourcing

Article excerpt

THE CHAIRMAN OF computer chip maker Intel has a problem with high-tech companies sending jobs overseas. Andy Grove thinks the problem is so big that the federal government should get involved with a proto--industrial policy for technology. But the problem is not so big that Intel should stop sending work overseas.

Confused? So is Grove, as well as much of commentary on the subject. The confusion lies in the difference between a short-term trend and a fundamental shift in doing business--what Grove would call a "10X change."

Intel and many hardware and software firms are currently trying to shed costs while revenue remains flat. Swapping U.S. workers for Indian or Chinese ones sure looks attractive in the current environment, and that explains why Grove says his duty to shareholders compels him to explore outshoring.

But does this mean that the U.S. is losing the vital brainpower it needs to remain a tech leader? …

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