Bush Distances Himself from Aide on Exporting Jobs

Reuters ^ | February 12, 2004 | Adam Entous

[Deliberator]

HARRISBURG, Pa. (Reuters) - Under pressure from fellow Republicans, President Bush distanced himself on Thursday from one of his top economic advisers who said the outsourcing of U.S. jobs to workers overseas may benefit the economy.

"The (economic) numbers are good. But I don't worry about numbers, I worry about people," Bush told students and teachers at a high school in Pennsylvania -- a pivotal state in this year's election and one of the hardest hit by factory job losses during his presidency.

Without mentioning by name the chairman of his Council of Economic Advisers, Gregory Mankiw, Bush said he was concerned "there are people looking for work because jobs have gone overseas" and vowed to "act to make sure there are more jobs at home" by keeping taxes low and by retraining displaced workers. Bush offered no new initiatives to curb outsourcing and aides said he opposed restrictions on free trade.

With political concern about unemployment heating up ahead of the November presidential election, critics have seized on Mankiw's characterization of "outsourcing" by U.S. companies as "something that we should realize is probably a plus for the economy in the long run."

Democrats said his comments and the council's annual report were evidence that the Bush White House is insensitive to the plight of out-of-work Americans.

Senate Democratic leader Tom Daschle predicted Mankiw would quit.

But Democratic Sen. Hillary Rodham Clinton of New York said, "This is the economic report of the president and not the economic report of Mr. Mankiw ... We cannot allow our Republican friends to shift the blame and the burden to Mr. Mankiw."

Senate Democrats said they would propose new protections for workers whose employers send their jobs overseas. Their proposal would require that outsourcing companies disclose their plans to their employees and to the Labor Department.

On Wednesday House Speaker Dennis Hastert of Illinois joined the bipartisan chorus of criticism from the U.S. Congress and the campaign trail, saying of Mankiw: "His theory fails a basic test of real economics."

The White House has rebuffed any suggestion that Mankiw resign. "That's kind of laughable," spokesman Scott McClellan said, adding: "Our economic team is doing a great job."

U.S. Commerce Secretary Don Evans defended the comments, telling CNBC: "What he praised was free trade and open trade. Every president since Herbert Hoover (1929-33) has said that free and open trade - as long as it's fair trade - is good for our economy."

At issue is the practice of a growing number of U.S. companies to move all or a portion of their operations to places like Mexico, India and China, where labor costs are lower and goods can be produced more cheaply, in order to improve corporate profits.

Nearly 2.8 million factory jobs have been lost since Bush took office and the issue looms large ahead of November's vote, where victory in rust-belt states like Pennsylvania could be key.

Underscoring its political importance to Bush's re-election, Thursday's visit was his 25th to Pennsylvania as president. He narrowly lost the state in the 2000 election, and analysts say he may have hurt his chances of winning it this year when he scrapped U.S. tariffs on steel imports in December to avert a trade war with Europe.

© Reuters 2004. All Rights Reserved.

[oceanview]

Because the Dems know how to play this politically, and Rove does not. Its already happening. There are alot of swing votes that can be moved on this issue.

[B4Ranch]

"The basic premise of globallization is that an economy functions best when individual processes are done in those places that are "best suited" to do them."

The Japanese had lumberships permanently anchored 14 miles off of the British Columbia coast for decades, probably still do, just to get away from our over regulated, over taxed business rules. And of course the unneeded shipping costs kept our lumber prices lower for many years also.

Fords plan worked because he kept the cost of his cars to a minimum intending on his clientle being the 'working man' not the bankers.

America became known as having the highest production plants because we used fork lifts, cranes and automated production lines to move materials to the men. We didn't move the men to the materials as most countries did.

We did this initially because we didn't have enough skilled workers. Bringing in millions of "temorary guest workers" will slow down our advancement even more.

As you say outsourcing will make America a service country, not the producer it once was.

[B4Ranch]

"I'm betting more than 5% off your next pair of shoes (made in China)."

Production cost or retail US. Remember Nike? Make for $4.00, sell for $200. 5%--20 cents vs $10.00

[ElCapitanAmerica]

Count a lost vote here.

Supported the president all the way, but I just can't vote for an adminstration that doesn't care about our nation losing our technological lead. Not to mention the potential backdoors that are going to be installed pretty soon in our infracstructure.

Think about it. I can pay a team of developers in India working on an air traffic control system say 10K, which is a lot of money there, and have them install a few backdoors ready to be activated on demand. It's already happening with bank and personal data.

How about all the research that is going out of the country, the president says technology is a solution for lost jobs, hello?!?!? That's what we are shipping off. Sales and marketeers don't develop inovation.

Sorry, I'm outsourcing my vote.

[logician2u]

Now people might laugh at that being some Democratic talking point, but its interesting to see Bush picking up on it.

No, it's discusting.

[oceanview]

I understand your feelings.

But remember that the Dems actually want to accelerate this trend, they want the private sector middle class to implode, low income people who need government programs are their key to a permanent majority at all levels of government.

[logician2u]

<spell check on>

disgusting

[Swanks]

the president says technology is a solution for lost jobs, hello?!

Actually he's big on the community college job training thing. Thta'll solve the employment problem. That's my problem; with an undergrad degree and an MBA my friggin' career problem is I missed the project management program (PMP) course, at Anytown Community College!

This guy....has no clue

[ElCapitanAmerica]

That might be true, but you know what, at least the Dems are talking the talk. Heck, I know most of them have no solutions, but the president has spokesmen laughing at our faces! I just can't take this anymore. Most of the people in my office, are just not going to vote for Bush because of this issue.

My vote is going to be a message, to all politicians, we pay their salaries and we can lay them off just like the corporations are doing to our fellow citizens.

Look at what the admin is doing, promising 2.6 MILLION jobs this year. Everybody knows this is bullshit. The latest numbers are horrible, and 3/4ths of the low number of jobs created where in the low skill / low pay / retail sector. This is the future for the country?

In the meantime we have Outsorceress Carly Fiorina trying to spin the situation, telling us we need to get better educated. Better educated? Really? I know people with Phds and masters that can't get decent jobs in their fields. Then she tells us the next thig is biotech. Somebody forgot to tell her and the admin that these jobs are already being offshored as well, not to mention that China expects to make a big coin in biotech.

I feel like the admin is begging me to not vote for them. In the meantime, I have to see testimony of Halliburton saying they overcharged for MEALS For our SOLDIERS. This is just too much.

[ElCapitanAmerica]

Exactly! The turning point for me started in the State of the Union address when he said this thing about community colleges. I couldn't believe what I was seeing.

How could the admin go nuts like this? Doesn't he know this is what nuked his father's chances???

Why aren't they offshoring their campaign advisors with more capable political consultants for 1/50 of the price?

[lewislynn]

But the reality is also this: Henry Ford was "outsourcing" part of his process from the very first day he started manufacturing cars . .

The reality is also this: Henry Ford didn't layoff workers and close plants in the US to build them somewhere else in the world for this market...Ford did however expand their business to other parts of the world without closing plants here.

Henry Ford didn't ask his workers to train their foreign replacements either.

The History Of Ford:

...Ford was the first international company. Within three years of its founding, Ford was exporting cars to Europe. Within ten years, Ford had assembly plants in Canada, Europe, Australia, South America, and Japan, Henry Ford's policy was to become a contributing citizen in every country where Ford sold cars. His slogan was "Build them where you sell them."....

---

...Today, Ford Motor Company is the second-largest car and truck producer in the world and is ranked second on the Fortune 500 list of the largest U.S. industrial corporations, based on sales. In 1994, Ford's worldwide sales and revenues totaled $128.4 billion, up 18 percent from 1993. Ford was also the leading exporter of vehicles from the United States and Canada, with a record of 120,133 units, a 70 percent increase over 1993. Although Ford is better known as a manufacturer of cars, trucks and tractors, it now produces a wide range of other products including industrial engines, construction machinery, glass and plastics. And Ford is established in a wide range of other businesses --including financial services, insurance, automotive replacement parts, electronics and land development....

You can call that "outsourcing" I call it business expansion without closing plants only to move the operation somewhere else. No one really has a problem with that.

[Revolting cat!]

The free traders and the Bushies here and elsewhere are good, so good at presenting and winning arguments (see above.) Just as they were in '92 and '96. But this issue is growing legs, longer legs than Ketchup Boy's bimbo eruptions that the WH strategerists are apparently salivating over. I've been saying for a year that this issue is going to boil over just in time for the 2004 Halloween season. The Stupid Party remains clueless, but then what did we expect from the Stupid Party?

[oceanview]

I agree with your points.

But also consider that its people on "our side" that are enabling Bush and the Rs on this. Look at the posters here on this issue, there is a small core of the same freepers who are trying to explain what is going on, what they see every day, and a much larger contingent of people who just say "let it happen", because of course its not their ox being gored. they believe their jobs are safe (they often never reveal their profession).

[oceanview]

we have a saying at work when this stuff hits, regarding why there is a level of management at and above which there is no impact (other then larger bonuses):

"a prince never shoots another prince"

[jpsb]

We are in for a sea change, like we saw in 94. No one I know is likely to vote for Bush and everyone I know voted for him last time. I fear the GOP will lose the house and the senate. And they deserve to lose.

[oceanview]

that's over reaching. they don't "deserve" to lose, Bush and the Congress didn't cause offshoring. They are guilty of failing to deal with it, but they did not cause it. The Dems have even less to offer.

But you are correct, at large corporations where offshoring is taking place, its all people talk about. And Bush is talking about steroid use during the SOTU. Bush is going to lose alot of votes on this issue for sure, they may well be lost in states he isn't going to win anyway where tech jobs are prevalent (CA, NJ, MASS, etc), and that could save him.

[jpsb]

NAFTA, they (GOP) deserve to lose. How can you ask any American to vote for a polictal party that thinks sending all our jobs to China is a good thing. Huh, even the Rats aren't that bad/stupid/evil.

[Alberta's Child]

Fords plan worked because he kept the cost of his cars to a minimum intending on his clientle being the 'working man' not the bankers.

You should go back and read that post of mine very carefully, because you'll learn a lot from it. Ford's plan did not "work" just because he "kept the cost of his cars to a minimum." As I pointed out, he could not possibly keep the cost of his cars to a minimum while at the same time paying his employees enough that they could afford to buy them -- unless, of course, his production process involved input from someone who could not afford to buy the cars.

[Alberta's Child]

If Henry Ford were a CEO today, I can assure you that his approach to doing business would be much different than it was back then.

[Alberta's Child]

I don't know about anyone else on this thread, but I'll share my background with you. I've been unemployed once in my life -- and as a result of what that did to me, I swore I would never go through it again.

If I ever lose my current job (I'm an engineer, for what it's worth), I'll do whatever it takes to earn a living. If it means getting another job in my field, then great. If it means driving a truck, or selling used cars, or washing windows, or mowing lawns, or working on an oil rig in Siberia for six months at a time -- then so be it.

One thing you will never see me do is sit around like an infant and complain about "all those people who aren't doing enough" to keep me employed.

Threads like this often make me wonder if Dick Gephardt is engaging in some kind of secret mission here on FreeRepublic.