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Outsourcing to India; Bush in India; Studying MS in Children

Aired March 01, 2006 - 11:33   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

CAROL LIN, CNN ANCHOR: A nuclear cooperation deal with India is the top priority during President Bush's visit to New Delhi. But his trip highlights growing concerns over what critics see as American jobs being shipped to India.
Our White House correspondent Suzanne Malveaux take as closer look at a company built on outsourcing.

(BEGIN VIDEOTAPE)

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT (voice-over): From the old India to the new. Two-thirds of all Fortune 500 companies have set up operations here. A unique corner office view for 36-year-old American Michael Jansen, whose design company is headquartered in Chicago, but operated out of New Delhi.

MICHAEL JANSEN, COMPANY OWNER: Started our business in the third bedroom of my apartment six years ago. Aside from myself, they're all Indian.

MALVEAUX: There are 200 employees here, most under 30.

JANSEN: In this company, we make drawings.

MALVEAUX: For the Trump Tower in Vegas, the MGM hotel, and the Shirmal (ph) Shanghai. Architecture and engineering firms from around the world contract out Jansen's studio, which provides designs for offices, hotels, and even animation.

Operating out of India, Jansen says, cuts his client's production costs by 60 percent.

JANSEN: To stay in a city like New York, an average staff salary would be about $70,000 for a functional architect today, whereas here it might be $10,000 to $15,000 a year.

MALVEAUX: And while Jansen is sensitive to the controversy brewing in the United States over outsourcing American jobs, he is unapologetic.

JANSEN: The world is changing. Guys who used to join my company came on bicycles, and later on they came on motorcycles. Today they own cars and homes.

MALVEAUX: And they are comfortable with their status.

KAS CHATTERJEE, EMPLOYEE: I don't know of a single instance where we have actually taken away jobs from a client.

MALVEAUX (on camera): When you hear that Americans could be paid much, much more than they're paying you, do you want to ask for a raise?

UNIDENTIFIED MALE: That's a tricky one.

MALVEAUX (voice-over): But living here is not for the faint of heart. Consider the traffic.

JANSEN: We took a client from the UK here, pulled up to a light, an elephant pulled up next to us. And the elephant just slightly shifted his weight and he hit the car, and the whole care rocked, and this guy was grabbing on for dear life. And needless to say, he never came back.

MALVEAUX (on camera): India is the world's largest democracy. And in a dozen years, it's expected to be the fastest growing economy, clearly a force to be reckoned with. President Bush comes here hoping to turn around the $10 billion trade deficit the U.S. has with this country. And at the same time, reassure Americans that their jobs are not going overseas.

Suzanne Malveaux, CNN, New Delhi, India.

(END VIDEOTAPE)

LIN: So let's get some insight now from the man who essentially planned President Bush's trip to India. Michael Green joins us live from Washington. He prepared the president's visit to India while serving as director of Asian affairs at the National Safety Council, and he's currently the senior adviser at the Center for Strategic and International Studies.

Good morning, Mr. Green.

MICHAEL GREEN, CTR. FOR STRATEGIC & INTL. STUDIES: Good morning.

LIN: Good to have you.

GREEN: Thank you.

LIN: Such a timely visit for you. We're going to talk about the jobs issue in just a moment. But let's get to one of the big facets of this trip. The president wants some security guarantees on India's nuclear reactors. What is his greatest concern? And what specifically does he want to walk away from the table with?

GREEN: I should start by saying I was one of many people who worked on this trip, and I've been out of the government for a few months.

But I think this trip is broader, I should say, than just the Civil Nuclear Agreement, which is getting all the attention. There's a lot of logic to cooperating with the world's largest democracy for the U.S. But this proposal on civil nuclear is certainly the most dramatic part of the trip and the toughest.

Essentially, the proposal is that India would take its nuclear facilities, put the civilian energy facilities under international safeguards and separate out the military, and in exchange the U.S. and other countries would help India to develop its civilian nuclear sector.

The logic of the proposal is that India, as your segment said earlier, is going to grow dramatically. It will turn to fossil fuels. That could drive up the price of oil, affect energy. Much better that they use nuclear and continue growing with that. And also that we get them to cooperate on non-proliferation efforts. Even if they don't join the Non-Proliferation Treaty, they can be part of a team of countries that fight the spread of weapons of mass destruction. That's the whole idea.

LIN: Given that India and Pakistan have gone to war twice, both have nuclear weapons, is there a specific concern by the administration that India would use its civilian program to supply its military resources?

GREEN: Well, to date, the civilian and military facilities have been somewhat intermingled, and it's going to take some work for the Indian side to separate them out. And ultimately, if the administration is going to sell this deal to the Congress and other countries around the world, there's going to have to be a real separation to prevent what you're talking about. And it's down to the wire. They may or may not pull it off. But I think this Civil Nuclear Agreement, while it's high profile and bold, is just one piece of a very broad relationship with India.

LIN: Sure. But important also because the president is going to Pakistan, meeting with Musharraf. There are concerns for both countries, on different issues, that it looks like the leaders are caving in to U.S. demands.

So when it comes to domestic concerns, you know, American workers working in a factory, wondering their job is going to go overseas, what does the president need to talk back to the American public out of this trip?

GREEN: Well, the -- India is a very young country. The average age is about 25. They are poised for economic growth. There's not much we're going to be able to do to change that.

LIN: But can Indian buy American? Because the trade gap issue is ridiculous.

GREEN: I think that's going to have to be the priority. When Indian service jobs are created for outsourcing or architects, it's in our interest that they buy American goods, that they use American services. India is going to have to continue making some economic reforms.

One of the things that the president is doing on this trip with the Indian prime minister is meeting with a group of American and Indian CEOs so they can talk, frankly, about what needs to happen to make the Indian economy more open. The trend in India is definitely toward more reform, more opening and more restructuring, because India needs investment and needs help to continue creating jobs for its people. And in exchange, we can ask for quite a bit in terms of restructuring the economy so there are opportunities for our exports.

LIN: Let's hope so. Michael Green, thank you very much.

GREEN: Thank you.

LIN: Now, we wanted to take a look at trade relations and see just how many jobs American companies have created in India. And here's what we found.

(BEGIN VIDEOTAPE)

LIN (voice-over): Trade between the U.S. and India totaled more than $25 billion in 2005. But there's an imbalance. The U.S. buys twice as many goods from India as it sells there. That's a trade gap that has grown substantially during the last decade.

Analysts say U.S. companies have moved about 500,000 American jobs to India, and that number is expected to triple in the next two years.

Whether it's data entry, call center staffing or research and development, an astonishing number of U.S. firms employ workers in India, companies ranging from Cisco Systems to General Electric and Home Depot.

The primary reason for the outsourcing trend: labor is much cheaper in India. While the average annual income is around $42,000 in the United States, it is only about $737 a year in India. Reports indicate U.S. companies can save as much as 50 percent in costs by having work done in India rather than the United States.

(END VIDEOTAPE)

LIN: Other stories making news around the world this morning.

Experts are trying to determine what killed 15 of the Bahamas famed flamingos this weekend. The birds were found dead on the Bahamas' southernmost islands. There are fears migratory geese and ducks have spread a deadly strain of bird flu to the islands. And if confirmed, it would be the first case of avian influenza in the Western hemisphere.

Mexico City wants the Sheraton Hotel to close its doors by midday today. Authorities cited the hotel for code violations. These include such things as no Braille menu in the restaurant, and no anti- skid treads on the stairs. Tourism officials say the city, well, is retaliating against the U.S. chain. That's because the Sheraton booted 16 Cubans earlier this month to comply with the U.S. embargo against Havana.

And China is sprucing up the forbidden city in time for the 2008 Olympics. The nearly 600-year-old complex in the heart of Beijing was home to two dozen Chinese emperors. The palace holds some of China's most treasured artwork and porcelain. The renovations will cost millions of dollars. Some will take a decade to complete.

All right, coming up, it's hard to diagnose in adults and some doctors are now trying to pinpoint MS in their youngest patients. I'll speak with a doctor on the forefront, next.

(COMMERCIAL BREAK)

LIN: Time now for our "Daily Dose" of health news. About 400,000 Americans have been diagnosed with multiple sclerosis, and most are adults. But the number of children diagnosed with MS is increasing. The National Multiple Sclerosis Society is setting up a network of centers to treat and study MS in children.

Dr. John Richert is vice president of research and clinical programs for the National MS Society. He joins us from New York this morning.

Good morning, Doctor.

DR. JOHN RICHERT, NEUROLOGIST: Good morning. Thank you for having me.

LIN: And thanks for being here. What is the trigger for MS in children? Do you know yet?

RICHERT: Well, no one knows what the trigger is for MS in either children or adults, but there are a number of studies that have indicated that there is some environmental trigger that occurs early in life, even for adults with MS.

LIN: What chemical exposure, pollutants?

RICHERT: Nobody knows. It may well be an infectious agent, although this is not a disease that one catches from other people with MS. But it may be an infectious agent that triggers the whole disease process. And by studying children with MS, we feel that because the interval of time between that environmental trigger and the onset of disease is much shorter than it is for adults with MS, that it gives us a much better chance of identifying what that trigger or those triggers are for people with both adult forms and childhood forms of MS.

LIN: So kids develop MS faster, then. And by doing so, you understand the process more easily. And yet, so many children may be misdiagnosed. Aren't the symptoms pretty dramatic?

RICHERT: Well, the reason for the misdiagnosis is largely because since this is largely a disease of adults, it's not a diagnosis that is on the radar screen of most pediatricians.

LIN: So if a mother comes in and says the child has blurry vision, numbness, fatigue, what does the pediatrician telling that mother if not MS? RICHERT: Well, there are other potential diagnoses. There's some post-viral syndromes, for example. There's something called acute disseminated encephalomyelitis, for example. We now think that there are probably at least 10,000 and maybe as many as 25,000 children with MS. And a number of those are children who have not been diagnosed with MS, but have some of these symptoms that have either gone undiagnosed or have been called something else.

LIN: So what would you recommend to parents?

RICHERT: Well, we have set up this new network that you mentioned of pediatric MS centers around the country that extends from coast to coast. This will provide first-rate care for children with MS and will also allow us to learn more about what the optimal care should be. We don't know, for example, what the optimal doses of various medications are. And we also...

LIN: Go ahead, doctor.

RICHERT: I was going to say that adult neurologists don't deal with many of the issues that children need to have dealt with, such as school issues, learning disabilities, that sort of thing. So it's important that pediatricians and pediatric neurologists who are knowledgeable about MS are involved in their care.

LIN: As a researcher, doctor, what are you most excited about? What are the greatest possibilities for you personally in this research project?

RICHERT: We will understand this disease, nor prevent it, until we know the cause. And part of the cause is genetic, and part of the cause is the environmental trigger that we talked about. We are funding a lot of work right now to identify the genetic background that lays the groundwork for susceptibility.

We have a lot of work to do still to understand how environmental triggers interact with that genetic background. And this is a very exciting opportunity for us to put all of this together and finally be able to prevent this disease once and for all.

LIN: Can you imagine how many lives you're going to change, Dr. Richert? Good luck with the project.

RICHERT: Thanks very much, Carol.

Here's how you can get more information on pediatric MS. You can call the toll-free number at 1-800-FIGHT-MS, to find out how you can help. You can also go to the MS Society Web site. The address is nationalmssociety.org.

Now coming up, a crime against the art world. But it won't take a gumshoe to solve this one. Here what happened on a class field trip to a museum in Detroit.

(COMMERCIAL BREAK) LIN: So your kid comes home from school, and says, hey, mom, I damaged a $1.5 million painting today. Not something a mom wants to hear. During a school field trip to a Detroit museum, officials say a 12-year-old boy stuck a wad of chewing gum on a painting. This painting. Now you might not be able to see it. It is Helen Frankenthaler's 1963 abstract called "The Bay." The gum left a stain the size of a quarter, but the museum, well, it's pretty it can get it out.

Now as for this 21st century Dennis the Menace, he has been suspended from school, and his parents let him have it. Maybe they chewed him out, what do you think?

(WEATHER REPORT)

LIN: I'm Carol Lin. CNN International news is up next. Stay tuned for "YOUR WORLD TODAY," and I'll be back with the latest headlines from the United States in about 20 minutes.

"YOUR WORLD TODAY" is next.

(COMMERCIAL BREAK)

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