When I started working in journalism, strips of copy had to be physically cut and pasted onto boards, which were then photographed to make printing plates. Today, thanks to cheap, powerful computers and desktop publishing software, this whole process is handled electronically: Instead of assembling and transporting boards, you create and transmit files.
The shift to electronic composing has reduced the manpower, time and cost involved in putting together a publication. At the same time, it has eliminated all the jobs associated with literal cutting and pasting.
Was that fair? The question can't really be answered, and the reason goes to the heart of the ongoing debate about offshore outsourcing of jobs by U.S. companies. Fairness, a concept appropriate in resolving schoolyard disputes and adjudicating legal cases, does not apply to market outcomes, which are not dictated by a referee or judge but arise spontaneously from the interactions of myriad individuals engaged in voluntary, mutually beneficial exchange.
Like the people who used to work in newspaper composing rooms, call center employees replaced by lower-wage workers in India don't "deserve" to lose their jobs. But that does not mean they have a right to keep them, any more than candle makers had a right to block electric lighting or blacksmiths had a right to prevent the introduction of the automobile.
In all of these cases, the need to make a profit in the face of competition drove people to produce better goods or services or to produce them more cheaply. The upshot of this process has been lower prices, higher productivity and a standard of living unparalleled in history.
Economic progress requires a constant shifting of resources to their most productive uses, and inevitably that means disrupting people's lives. As Brink Lindsey, director of the Cato Institute's Center for Trade Policy Studies, notes in a recent paper, "Total U.S. private-sector jobs increased by 17.8 million between 1993 and 2002. To produce that healthy net increase, a breathtaking total of 327.7 million jobs were added, while 309.9 million were lost."
Amid this perpetual churning, offshore outsourcing, the latest focus of anxieties about economic change, does not amount to much. "The single most important factor explaining lagging job creation is the astonishing gains in labor productivity that have been achieved in the U.S. economy in the past few years," Federal Reserve Gov. Ben Bernanke observed in a speech on March 30. "Outsourcing abroad simply cannot account for much of the recent weakness in the U.S. labor market."
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