Outsourcing to Developing Countries Term Paper Example | Topics and Well Written Essays - 1000 words - 1

Outsourcing to Developing Countries - Term Paper Example The question of outsourcing has a brought about a lot out a myriad of protests, many of them by them based on the escalating the rates of unemployment. Notably, while there are some Americans that take it as a positive thing many more are scared by what it portends especially those who have lost their jobs to foreigners. According to Howard, in the article â€Å"Globalization is an anomaly and its time is running out,† China hosts very many of American china stores and myriad firms all are taking advantage of the cheap labor and raw materials. However, should China involve itself in search for oil from its Arabian neighbors there is potential for conflict? In such a case, America and China may be embroiled in an international row and this might force the investments in America to be closed down (Howard). Furthermore, due to political instability in many developing companies, outsourcing might mean risking losing the investment in the time of riots or civil wars and the economy back home would suffer directly as a result of a conflict in which America is neutral. Outsourcing is a two-sided sword, effectively cutting both parties in the arrangement, in America; there are several financial gains especially for the firms involved. They get to form international networks thanks to globalization, obtain cheap labor, wide market and finally they are paying very little tax since some of the countries in which they outsource give foreign investors tax breaks to encourage them and other multinationals to invest therein. In this paper, the issue of outsourcing will be examined closely in order to support, through argument, the position that outsourcing is doing more harm than good to the American economy. Outsourcing carries a myriad of negative financial implication for America; one of these is that it greatly contributes to unemployment in the USA. It is predicted that 949 million will be lost because of outsourcing annually. These losses are not purely business by a huge fraction of it represents lost wages, to Americans, whose former employers have decamped so they can hire cheaper labor.