In my experience (last 5 years in MegaCorporations) the problem is that the people who are actually hands-on managing the offshoring projects are different from those who make the decisions. The guys who decide to offshore are usually at least 2-3 layers of management above.

The urge to offshore software development at that level is strong, and the management sees it as a megatrend which "we'll have to follow because everyone else is doing it".

The feedback loop is broken, the decision maker who offshores a certain project is no longer there when a couple of years later it's clear that the whole thing was a disaster. He's busy offshoring some other project.