Monday, November 01, 2004

A lot of economists aren't worried about overseas outsourcing, they say, because they think that the U.S. has a sustainable competitive advantage in new, exciting, innovative new industries. Which may be true to a point -- there are a lot of foreign biotech companies opening labs in Kendall Square near MIT.

But I've never completely bought the argument. For one thing, a lot of Silicon Valley Venture Capitalists are strongly urging the new companies they finance to outsource immediately -- which means that the American innovation they finance will be creating jobs overseas. For another, it flies in the face of the historical experience of postwar Britain, which had an immense lead in all sorts of technical areas -- first jet airliner, first computer in commercial use, etc. -- and utterly squandered it; there's an interesting little book on the computing experience called "Innovating for Failure".

Well, here's a bellwether. U.S. citizen Steve Chen, one of our top supercomputer designers (he's responsible for several Cray Research machines) is joining a new outfit to build the next generation of supercomputers -- in China, splitting his time between there and San Jose. (It apparently doesn't bother them that he was born in Taiwan -- but hey, that's just a province of the motherland anyway, right?)


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