Services, as a practical matter, are also not moved very easily, in many cases.  An Indian operator may be able to take over the job of Dell's customer service, but he can't put your money in the cash register at Wal-Mart, or sell you a phone at Nextel, or fix your iPod at the Apple store, or whatever else you may need.  You can't, for example, outsource the work of a locksmith.

I don't see what you mean by a refutation of the Division of Labor and Comparative Advantage.  Both are largely true, in my opinion.  In many cases, the economic losses in these small towns are the result of the citizens having elected a state or local government made up of total fools.  Rural states have skewed their policies, usually in favor of agriculture, and, today, they wonder why all they can produce is heavily-subsidized agriculture.  (Gosh, that's just shocking, "in'nit"?)  Hence why I've made it a habit to attack rural, Red-Staters as being the true "welfare queens" (to use Ronald Reagan's words), because they're completely dependent upon the tax dollars of urban, coastal cities (the Blue States, or the Blue areas of Red States).

Be nice to America. Or we'll bring democracy to your country.