In response to some of the comments on Russ’s "Made in ?" post, I reprise here a post of mine from April 2005.

April 26, 2005

What Can be Wrong with Forcing Firms to Reveal More Information?

Don Boudreaux

"Hey Mr. Free Trader, do you at least agree that companies should be required to tell customers if the people they’re dealing with on the phone live in America or not?"

That’s the opening line of an e-mail that arrived today in response to my most recent post on Paul Craig Roberts’s incoherent fears about outsourcing.

I knew immediately the sort of proposal that my correspondent has in mind. Many times during the past year I’ve
heard it proposed that Uncle Sam require American companies with call
centers in Bangalore, India, and other foreign lands to have their
employees in these centers begin each conversation by informing each
American who calls into these centers that he or she (the employee) is
not American and is not located in America.

John Kerry even made
such a proposal part of his presidential campaign, and introduced a
bill in to the Senate hopper called the Call Center Consumer’s Right to Know Act.

Sen. Kerry’s bill, if passed, would have required any

United
States corporation or its subsidiaries that utilizes a call center to
initiate telephone calls to, or receive telephone calls from,
individuals located in the United States, shall require each employee
in the call center to disclose the physical location of such employee
at the beginning of each telephone call so initiated or received.

Those who argue in favor of such a requirement allege that it’s not coercive (at least not to consumers). It merely requires companies with off-shore operations to disclose
this fact clearly to consumers. Consumers are then free to patronize or
not the firms that have some of their operations in foreign lands. Many
consumers, after all, do indeed care about whether or not the company
they’re patronizing has off-shore
operations. And some of these consumers would no doubt stop patronizing
the company upon learning that it hires foreign workers.

"So what can be wrong with full disclosure?" – so concludes the e-mail from my correspondent.

I answered by pointing out that requiring firms to reveal the physical location of their employees isn’t really full disclosure. It’s fuller disclosure, but it’s far from full
disclosure.  And this distinction is relevant.  Oodles of
information remain about each company and its employees that is not explicitly
revealed in the absence of legislation but which might well be relevant
to some callers.

Here are some other things that many American
consumers no doubt care about and that firms probably would not reveal unless forced by government to do so:

- an employee’s sexual orientation

- an employee’s religious beliefs

- an employee’s political beliefs

- an employee’s attitudes toward controversial matters such as abortion, euthanasia, and the death penalty

So why stop with requiring firms to reveal their employees’ physical whereabouts? Why not also require firms explicitly to reveal to customers information on all of the above matters?

When Joe from Atlanta calls the Dell help center, he might then be treated to the following greeting: "Hello. Thanks for calling Dell. I’m Anokhi. I’m answering your call in Bangalore, India. I’m an atheist lesbian who always votes for the socialist party. I see nothing wrong with abortion, although I’ve
never had one myself. I also believe in euthanasia, although I oppose
the death penalty. I also feel strongly that the U.S.-led war in Iraq
is immoral. How can I help you today?"

This greeting sounds silly. This greeting is
silly. But each piece of information offered is plausibly important to
some small handful of Americans. Therefore, I see no reason to single
out for enforced disclosure information on companies’ extent of
off-shoring. Declaring truthfully that some customers might find this
information useful is insufficient to justify such enforced
declarations.

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