Outsourcing is not all very glamorous. I have heard many companies who tried outsourcing but miserably failed. I talked to a manager working at Sathyam and he was saying that some companies do not want to go with Sathyam again because of their screwups. Outsourcing is not new, it has been there for a long time. Only peripheral projects, which are very non-critical will be outsourced. Unless the company has its own wing in other countries, it is very difficult for outsourcing to work becuase of the layers of communication it has go through. But people will find out a way to reduce these hiccups as this is more lucrative.
For all those dumb people who can't understand common sense - outsourcing makes goods cheaper putting more money in people's pockets just what the manufacturing goods from China did a decade back. This in turn drives the economy up as people buy more and save more. This creates more jobs. If the US does not do it, other countries will do and the US will be flooded with those products. We are not talking about disconnected economies here. If we were we will all be writing on a leaf.