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U.S.
Jobs Going Overseas Becomes Election 2004 Issue |
Posted:
03.10.04
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One of the major political issues in the 2004 presidential election
is framing up to be outsourcing -- the movement of jobs and sometimes
entire companies to other countries in search of cheaper labor.
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Outsourcing is not a new issue. It has been occurring since the
1970s when thousands of manufacturing jobs were slowly moving
to countries such as Mexico, Taiwan and Korea where  workers,
making anything from tennis shoes to clothing, work longer hours
for less pay.
While cheap labor is the primary cause for outsourcing, low shipping
and communication costs contribute; companies can produce goods
overseas and then ship them back to the United States without
significant tax.
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Not just
cheap clothing |
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But recent trends have shown that manufacturing jobs are not
the only jobs being outsourced.
"Any worker whose job does not require daily face-to-face
interaction is now in jeopardy of being replaced by a lower-paid,
equally skilled worker thousands of miles away," said Paul
Craig Roberts, an economist with the Institute for Political Economy
who worked for President Reagan in the 1980s.
This means that high paying jobs once thought safe, such as software
engineers, data processors, phone bankers and software designers,
are now at risk of being outsourced.
As Goldman Sachs Asia official Ken Courtis explains, outsourcing
makes economic sense: "We pay hundreds of thousands of dollars
a year to hire a good engineer. You can hire ten engineers for
that price in India."
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Why go overseas? |
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New York Times columnist Thomas Friedman told The NewsHour that
India is the most popular destination for outsourced high-tech
jobs because there is a "huge amount of educated people who
speak English."
The Internet makes transferring technical data easier and cost
effective, and by locating workers in different time zones around
the world, the company can have 24-hour service.
 Greg
Mankiw, chairman of the White House Council of Economic Advisors
that produced the Bush administration's 2004 Economic Report to
Congress, said that outsourcing white-collar jobs is inevitable.
"It's something that we should realize is probably a plus
for the economy in the long run," he said, adding that it
is "just a new way of doing international trade."
His message echoes the recent White House economic report signed
by President Bush earlier this year, stating, "When a good
or service is produced more cheaply abroad it makes sense to import
it than make or provide it domestically."
Friedman argues that outsourcing works for U.S. businesses, not
only because it provides cheaper labor, but because those new
workers create a middle class that can then purchase more from
American companies (if Americas stay creative enough to come up
with innovative products that these new consumers will want).
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Opposition
is building |
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However, many American workers see outsourcing as a dangerous
trend. The AFL-CIO, one of the largest union groups in the United
States, is highly critical of any attempt to outsource traditionally
American jobs.
AFL-CIO President John Sweeney, in a statement published on the
organization's Web site, criticized the Bush administration for
its support of outsourcing.
 "It's
outrageous that despite one of the worst job creation records
in history, and despite the 9.9 million Americans still out of
work in our jobless 'recovery,' the Bush administration has blessed
sending more jobs overseas in its annual economic report to Congress,"
he said.
Politicians are beginning to respond to pressure to do something
about the movement of jobs to other countries. Congress is currently
debating a proposed law that would stop the government from buying
goods and services from companies that outsource. Another proposal
would require workers at telephone call centers to disclose their
physical locations at the beginning of each call.
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Presidential
politics |
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As the November election approaches, President Bush has tried
to distance himself from Mankiw's remarks.
"People are looking for work because jobs have gone overseas
and we need to act in this country. We need to act to make sure
there are more jobs at home," the president told a Harrisburg,
Pa. audience in February.
 Mr.
Bush was in Pennsylvania, a state he lost in 2000, to talk about
his jobs initiative, a program to retrain workers for high-tech
jobs.
At a recent campaign speech in Florida, another important state
in the 2004 presidential election, leading Democratic candidate
Sen. John Kerry of Massachusetts criticized corporations that
outsource jobs and avoid paying taxes using loopholes.
"Why should the American people subsidize the corporations
who take jobs overseas?" he asked.
"It will be an economy based on people and products,"
he said, "not perks and profits."
--
Meghann Farnsworth, Online NewsHour
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