In 2003, the US state of Indiana put out to tender a contract to upgrade the state's computer systems that process unemployment claims. Tata America International, which is the US-based subsidiary of India's Tata Consultancy Services, bid $15.2m for the contract - $8.1m lower than did its closest rivals, the New York-based companies Deloitte Consulting and Accenture Ltd.
In other words, an Indian consulting firm won the contract to upgrade the unemployment department of the state of Indiana. You couldn't make this up: Indiana was outsourcing the very department that would cushion the people of Indiana from the effects of outsourcing.
But when, in 2004, word of the contract was made public, Republicans made it a campaign issue. It became such a political hot potato that Governor Joe Kernan, a Democrat, ordered the state agency, which helps out-of-work Indiana residents, to cancel the contract - and also to put up legal barriers to prevent such a thing happening again. The Indianapolis Star reported that a cheque for $993,587 was sent to pay off Tata for eight weeks of work, during which it had trained 45 state programmers in updating software.
Who is the exploiter and who is the exploited in this India-Indiana story?
The American arm of an Indian consulting firm proposes to save the taxpayers of Indiana $8.1m by revamping their computers - using both its Indian employees and local hires from Indiana. The deal would greatly benefit the American arm of the Indian consultancy; it would benefit some Indiana tech workers; and it would save Indiana state residents precious tax dollars that could be deployed to hire more state workers somewhere else, or build new schools that would permanently shrink its roles of unemployed. And yet the whole contract, which was originally signed by pro-labour Democrats, got torn up under pressure from free-trade Republicans.
Sort that out.
The India versus Indiana dispute highlights the difficulties in drawing lines between the interests of two communities that never before imagined they were connected, much less collaborators. But suddenly they each woke up and discovered that they were living in a flat world.
"Globalisation is the word we came up with to describe the changing relationships between governments and big businesses," says David Rothkopf, a former senior Department of Commerce official in the Clinton administration and now a private strategic consultant. "But what is going on today is a much broader, much more profound phenomenon."
Whenever civilisation has gone through one of these disruptive, dislocating technological revolutions - like Gutenberg's introduction of the printing press - the whole world has changed in seismic ways. But the introduction of printing happened over a period of decades and for a long time affected only a relatively small part of the planet. Same with the Industrial Revolution. This flattening process is happening at warp speed and directly or indirectly touching a lot more people on the planet at once. The faster and broader this transition to a new era, the more likely is the potential for disruption, as opposed to an orderly transfer of power from the old winners to the new winners.
Our old political reflexes no longer apply. If you are against globalisation because you think it harms people in developing countries, whose side are you on in this story: India's or Indiana's?
