Mark Cuban on Outsourcing

Mark Cuban’s opinions on outsourcing. He thinks outside the box and is not afraid to be controversial.

This has become a flashpoint across all of America. I can understand both sides of the argument. On one side, replacing an American worker with one from overseas means one of our own loses a job. That is terrible for those who are displaced and their families. As an employer, I can also understand how the money saved from diverting that job overseas can be used to do quite a bit. It can be applied to Research and Development, it can be a pay increase to other workers, it can be used to hire workers who add new value to company.

If the money is redeployed and invested in the company, I dont have a problem with it. I can see that although some my feel the pain shorterm, that the capital redployment will result in a netgain to the economy and the job count in our country.

Where I have an issue, and where I think there needs to be controls put in place, is when corporate insiders in essence put the money saved from outsourcing in their own pockets. If you go through the list of companies that outsource and start looking at stock sales, bonuses and other incentives, you quickly see that a material portion of the money saved is going into the pockets of insiders. Thats wrong. Or the outsourcing is being used to hit a wall street expectation for quarterly earnings, maintaining stock prices and enabling insider stock sales. Thats wrong.

If we want to make outsourcing the route of last resort and to make sure its only used when it makes absolute business sense, Prevent insiders from selling stock or earning corporate bonuses in any year they outsource jobs.

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