For the most part everybody so far has suggested preventing the free will of corporations. What would you do if somebody tried to prevent you from doing what you wanted to do? From doing what you felt was in your own best interest? Most likely you would find away around their authority. I am not saying that I wouldn't want to place some stiff tariffs or tough laws. But would they really be effective?
That may mean moving (from Seattle to Vancouver), bartering (Setting up shell corporations) or any number of other methods. Regardless, you cannot prevent someone from eventually doing something that they deem is in their own best interest (however short sighted). You can only change what they believe is in their best interest.
Addressing Marks original question. What would do I think such a group should do?
It should first answer the following questions:
First know what lies at the heart of the issue? That’s easy. Decreased costs.
Next what are the risks involved? What are the inherent weaknesses of off shoring? What are the weaknesses of the labor markets in the countries that are being off shored too?
Thirdly, how can we exploit their weaknesses? As many here have argued labor costs are not all there is to software development. So what are those other elements? Once we know their weaknesses we can work on a plan of action to exploit those weaknesses.
I would be a fool to think this would stop off shoring. The lower costs offer a huge advantage. However, if the organization could work on tipping Mark’s formula a little more in favor of the workers they are looking out for.
Example: If one element of the problem is the cost of training US workers then the organization should help to decrease those costs. Again it will not end off-shoring but it will help to tilt Mark’s formula from dU + tC < U to dU+tC +1 < U. Every point that we can line up will mean extra jobs that will stay here.