When I left college (in India) with an EECS engineering degree in the early eighties, the computer industry in India was small but competely local. Tariffs and laws prevented the import of computers, and there were about 6-8 companies in India who designed, manufactured and sold computer systems. The way the laws worked, you could import components (chips, capacitors etc.), but not computers, so these companies were protected from imported computers.
I joined one of these companies and spent several years essentially living in heaven. We were doing leading-edge work and in the space of a few years, I designed several CPUs, I/O processors, graphics processors and OS-level code for things like zero-latency disk reads and inter-processor communications. Others at my company built compilers, database management systems and graphics libraries. This was all proprietary stuff, very expensive because of the cost of all the R&D people like me and the low volumes. But I was doing what I loved, doing it well, and having a blast. I didn't get paid much (All I could afford for several years was a bicycle until I managed to save enough money to buy a small motor--scooter), but I didn't care. I worked 16-hour days just to get my name on the next system that we rolled out.
Somewhere in the mid-80s, the Indian government decided that they shouldn't protect these companies, and everyone should be allowed to buy computers from wherever they want. I wasn't worried. I knew the systems I built were better, and I understood Indian customers much better than the American companies whose systems that were starting to come in. I remember looking at the early IBM PCs and some Unix boxes and feeling smug about how much better our systems were.,
You can probably guess the rest of the story. To my utter surprise, my company decided they don't want to have us design their systems any more. Because of their much larger volumes, the US systems cost less, and management calculated they could make more money by getting the basic systems from a US company and focusing on sales, support and custom application development. As a bonus, they got rid of all the wierd techies like me who never quite fitted the corporate culture (they didn't actually fire us, but asked us to move to support/sales, so I quit). The same thing was happening at all the other computer companies, so we didn't find design jobs anywhere else either.
There was no outcry, no political storm, but very quietly and peacefully, my design job had got outsourced to some designers in the US because the final result was cheaper. There's a long story about what happened next, but for the purposes of this post, the important thing was that I figured out there was no point in blaming the government or my management for what happened to me. All that happened was that something removed the protection I was working behind, and naturally my job went to someone who could do it better than I could. What else could happen? Asking for protection again was like trying to retreat into a fantasy cocoon (and nobody was listening, anyway
What surprises me is that so many people in the US today think the current wave of outsourcing is different and try to make this into a moral issue. I can understand the dissapointment of losing a job you love (I've had it happen to me), but I don't see any fundamental difference between what America (and to some extent, Europe and Japan) have been doing in such a dominant way for so long (designing and manufacturing so many of the world's goods), and what is happening in a small way in India right now. If Indian companies decide not to design computers, TVs, cars, DVRs etc. and 'outsource' their designing to companies in the US/Japan, while handling the sales/support in India, how is it different, at a fundamental level, from software outsourcing from the US to India?