I know a gentleman who swears by oDesk, mostly as a billing/mediation platform for custom Twilio apps. I wouldn't touch it with a ten foot pole, but he charges enough to make it viable.
Twilio also endorses oDesk as a platform for people to find qualified programmers http://www.twilio.com/blog/2011/06/twilio-partners-with-odes..., maybe the answer is to specialize and differentiate to become more successful when competing against $10 per hour international outsourcers.