Odd as it may sound, India is also pricing itself out of the outsourcing market. Most US companies are looking elsewhere, like the Philippines. Egypt was starting to get popular, but folks are a bit hesitant to put anything there these days.
China's starting to get bigger, but it's even harder to find good English speakers there.
As for the US educational system, I can't imagine even 3 out 100 college grads being able to do the most basic phone or email support in another language. It's hard enough to find some that can speak proper English. I still have nightmares of opening a support center in Dallas. Sheesh.