Quit your whining. This is a good thing people and it's an example of what makes capitalism great.

Read up on Joseph Schumpeter [newschool.edu], arguably the most brilliant economist to come out of Austria. One's inability to see that the move of IT labor offshore is a good thing is largely due to a failure of most people to understand Schumpeter.

Schumpeter's primary focus was on capitalism as a dynamic system. It continually evolves through creative destruction. There are countless examples of this phenomenon.

A 120 years ago, most Americans were living on farms. With little mechanization, hard manual labor was the order of the day. As mechanization began to become more prevalent, thousands upon thousands of farm workers were surplus to requirements. Doom and gloom predictions that the move from an agricultural economy to a non-agricultural economy would lead to the collapse of America were common. Politicians ran on platforms aiming to keep the family farms solvent and prevent greater mechanization (for instance by taxing production of goods that could be used for farm mechanization).

However, mechanization and consolidation took place in the agricultural business. Today, less than 3% of Americans are farmers, and there are far fewer farmers today than there were then. If static economic analysis, from the perspective of the past, was used to look at the economy today (or during the boom years of the late 1990's), the only conclusion would be that the US was in a total depression, because the vast majority of the old farm jobs were gone.

So why wasn't it the case that the US went on to enjoy even better economic times than in the late-19th century? Why isn't there 90% unemployment (since from the 19th century perspective, 90% of the jobs that existed then are gone today)?

What no one saw was that freeing up the most important capital, human labor, from inefficient application to the task of growing food for other purposes. What those who looked at the farms failing and saw disaster were missing was that now the farmer was able to go to the city and be basically as well off working in a factory, and that the farmer's children would go on to become doctors or lawyers or engineers or skilled laborers. Indeed, the industrialization could not have happened without the farm failures.

For a more recent example, look at the state of heavy industry over the last 30 years. In the 1950's, 50% of Americans worked in industrial occupations, creating physical products. Nowadays, it's less than 20% (IIRC). You would expect there to be massive (>30%) unemployment, wouldn't you?

But there's not 30% unemployment. The children of factory workers went to college and became clerks or salesmen or scientists. Think about what your grandparents did for a living. With few exceptions (I'm one of them; my grandmother was one of the early programmers of ENIAC-type machines), they weren't computer scientists, sysadmins, or electrical engineers. They were probably factory workers, or day laborers, or housewives, or maybe a clerk at some large industrial concern.

By freeing up human capital from making cars and clothing and other labor intensive tasks, financial services, creative services, IT itself could be spawned.

IT arose out of the collapse of an old economic model; it will collapse as a major player. It is inevitable. In 20 years, the jobs held by the readers of this site will have demand levels at a fraction of what they were before. In a century, we'll be looked at as the farmers; while there will still be demand for the tasks we perform, it will be nowhere near what it is today (and nowhere near what it was a few years ago).

The core of what I'm saying is that we don't know what will come next (though it is most likely happening below our noses). There is a fear of the unknown that most people seem to have. Do I know what's coming next? No. But am I certain that something will come along next to consume our collective labor in a new and even more efficient manner? Absolutely and irretrievably, because it has never failed before.

The worst thing we could do would be to pass laws fighting this dynamic change aspect of capitalism. Capitalism is a tsunami, and attempts to control it will simply result in total failure or if they succeed in the short term, will merely enhance the impact of the tidal wave later, when it's too late.

For an example, look at Western Europe. In the 1950s, Europe enjoyed a similar level of prosperity to the USA. Now it has fallen behind, with double-digit unemployment and ruinous social taxes to support those unemployed. Not even subsidies to vital industries (such as shipbuilding) prop up the economy. In the meantime, Europe was somewhat behind the US in the move toward the information economy. What happened?

As demand for European production of heavy goods declined, the answer was to subsidize their huge employment levels. If you take a cruise on a luxury liner around the Caribbean and are amazed at how low the price is, thank Francois Mitterand, or any of hundreds of Italian or British politicians of the past few decades; their government subsidies of shipbuilding (at times to the point of virtually paying Carnival or Disney to build a cruise ship at their country's shipyards) are what make those low prices possible. But the opportunity cost of continuing to tie up their capital (human and financial) in sunset industries is what got them in the funk they've been in for the past 20 or so years.

What causes this aversion to economic change? I conjecture that it is the simple fact that when a company lays off its workers, it's in a massive burst. You read in the newspaper that IBM is letting 10,000 employees go. You don't read of the biotech startup or whatnot that hired 20 people in the last month.