Bush strikes back at critics of outsourcing

The Financial Times ^ | 9. March 2004 | Edward Alden

[1rudeboy]

President George W. Bush hit back at Democratic critics of his administration's job-creation efforts on Tuesday, branding them as "economic isolationists" who would raise new trade barriers and damage the US economy.

The comments came as part of what appeared to be a co-ordinated administration effort to respond to growing political pressures over the slow pace of US job growth, which has helped push Mr Bush's likely Democratic opponent, John Kerry, ahead of the president in several recent polls.

In a speech in Virginia, Mr Bush said: "There are economic isolationists in our country who believe we should separate ourselves from the rest of the world by raising up barriers and closing off markets. They're wrong. If we are to continue growing this economy and creating new jobs, America must remain confident and strong about our ability to trade in the world."

Robert Zoellick, the US trade representative, similarly warned Congress on Tuesday that "given the fact we're now in a stage of an economic recovery, the absolutely worst thing we could do would be to turn to economic isolationism".

Mr Zoellick told the Senate finance committee that increasing US exports to countries such as China and India, encouraging foreign investment in the US, and helping workers adjust to the loss of some jobs abroad were better responses than "bureaucratic interventions that will increase prices to our people".

Mr Bush's comments came less than a week after the Senate passed legislation aimed at preventing US government contracts from being carried out by workers in developing countries.

The administration has been uncertain over how to respond to the continued slow pace of job creation. Mr Bush has sought to distance himself from recent remarks by a senior economic adviser, Gregory Mankiw, that outsourcing of jobs is just a part of trade and therefore good for the US economy. But the administration now appears set to mount a more robust defence of companies that move US jobs abroad.

"US companies with foreign affiliates now account for about 58 per cent of our exports," said Mr Zoellick. "So the companies that do business overseas are also exporting overseas."

"I think the challenge is: How do you help people in a way that doesn't hurt or kill other jobs?" he said, pointing out that the US currently runs a $60bn annual trade surplus in the service sector, which has seen a growing number of jobs moved to lower-wage countries.

[applemac_g4]

>>There are a certain few who are making a lot of money off
>>these imbalances...

>Read carefully what you're saying: it's a terrible thing if
>someone makes a lot of money

That isn't what he is saying.

What he is saying is that it is a terrible thing if someone profits by pursuing a goal that is harmful to the national interest. That is as true of George Jr's "Viva la Mexico" globalistas as it was of Clinton when he sold nuclear secrets to the Chinese - and for that matter, Benedict Arnold's treasonous behavior at the time of the American Revolution.

[lentulusgracchus]

The government just needs to reduce regulations on business, cut business taxes as much as possible and get the hell out of the way.

Will you promise to say that when ILGWU and the AFL-CIO and the Teamsters have organized 85% of the non-management U.S> employment base and are driving to sign up the rest of it?

[Mr. Bird]

Oh, so they lowered everyone's taxes when they "outsourced" to foreigners?...I didn't know that.

Neither did I, which is why I didn't say that; shame you thought I did. Tell me where my logic is flawed: if the state is going to spend more money, it likely needs more revenues. It gets those revenues from the taxpayer. So, let's say the state has two options, A and B. A costs 10 dollars, B costs 20 dollars. Aren't more revenues from the taxpayers required for option B?

[dfwgator]

The one good thing about health care employment is the increased demand caused by an aging population.

They'll just hire foreigners for those jobs as well.

[going hot]

You might find this interesting: THIS POST

[PigRigger]

"These people are "scared" because the media is scaring them...."

Not true. I personally know a few people who have lost their jobs due to "off shoring". In addition, many of my friends, all white are collar Republican voting Americans, who have seen the same thing happening in their companies.

This is not a "Media Scare" tactic used to prop up the Dems; it is happening now - and picking up steam. If you work in the Tech or Financial Industry it is is something you see every day.

Sooner or later it might be my job they come for next. I am better prepared than most to weather the storm. Unfortunately, weathering the storm might mean liquidating all my assets. Most people don't have that much to liquidate, they are over extended as it is in their pursuit of the American dream.

I've been attempting to find ways to prepare myself in the chance that I am next. Unfortunately, just to keep my job now I have to work 11 hour days and weekends; doesn't leave much time to retool for another career. The impact on my personal life has been severe; I pretty much don't see my kids until the weekend. I'm caught in a catch 22 - all roads lead to extreme sacrifice.

I'm 41, have two kids and a wife. We live modestly, small house with a small mortgage. We are frugal in many respects. Thus, if I lose my job I can survive for a year without pay. That is better than most can say.

Unfortunately, the cost of outsourcing will probably mean having to start over. I may lose all my retirement, kids college, and investments just to survive and retool. If I decide to open my own business, things look even bleaker - most new businesses fail. Thus, rolling the dice may not be an option. These are only the financial costs, the human costs are even more painful to think about. The impact to my family, and our future, is incalculable. This is the reality facing many Americans today.

If I were in my mid-twenties and single this would be easier to face. However, these are the years I am supposed to accrue my nest egg for the future. It appears that these expectations have to be reevaluated going forward. If the current set of expectations no longer fit into America's economic model of today, it must be communicated to those entering the work force now. If the expectation is that we may have to retool multiple times during one's life - it will impact all aspects of how we view our future - and how best to prepare for it.

[lentulusgracchus]

You'll generally see a devolution in an economy when a government tries to tinker with the will of that economy's participants. It has never happened otherwise.

It may be "happening otherwise" before our eyes, as giant NGO's (corporations) disassemble it like an old foundry.....and toss the workers onto the junk-heap.

But if you prefer, we can wait for the outcome, and not try to predict a bad one, if it bothers you, or you don't think we should believe in bad outcomes for good people.

[Mr. Bird]

The one good thing about health care employment is the increased demand caused by an aging population.... They'll just hire foreigners for those jobs as well.

We are; the U.S. schools can't churn them out fast enough. And the dynamic keeps changing; five years ago it was low interest in the occupations. Now it's low supply of qualified instructors.

If it's any consolation, most states have strict regulations on who is eligible for licenses, and most foreign countries do not provide the necessary education and training. The Phillipines is one of the few exceptions. But the future numbers are astounding in some fields, and foreigners will never be able to fill the gaps.

[Dane]

Could you please answer me a few questions. Why do you think that his issue will not be big in this election. I work in IT and I do not know of a single person in this field that the issue ouf outsourcing is not in the forefront of their minds. I have seen a family menbers job outsourced to India and have watched them have the greatest of difficulty in finding a new job. Why do you expect the American voter to forget this when he goes into the voting booth?

Because there are other issues. In the early 80's I saw the steel mills close in Pittsburgh. It was the end of the world to them, yet Reagan was still re-elected in 84.

You are in IT, some people are getting outsourced but the extent is not that of what happened to steel in the early 80's. The world does not revolve around you or your industry.

94.4% of the workdorce is employed.

[PigRigger]

Don't argue with unemployment figures. Just asking the question - when is the last time we seen such economic growth with such little domestic job creation?

Not bashing Bush - this is an issue that any President will have to address regardless of party. Again, I agree the economy is humming - usually that also means a lot more jobs being created. However, that does not appear to be the case today.

[expat_panama]

#199  if the protectionists were intellectually honest with their rhetoric they would be bashing Mel as a "Captain of industry" for filming his movie in Italy

When he fills in for Rush, Walter Williams likes to point out the hypocrisy of the protection mob.  They want high import taxes for what we buy but not for what they buy.

Protection is basically a welfare abuse scam.  The protector people say there's no work -- when you offer them a job they say it doesn't pay as much as their government handout.  You tell them to retrain and they accuse you of only caring about the big guy and not the little guy.  Pitiful.

[TXBSAFH]

So.
This issue is the one the rats and the lib media will hammer GWB with for the rest of the year. It is the one that can win for them. Just look at the number of news articles about it in the past week or so. What is perceived will often beat reality. Action needs to be taken and the voters need to see action taken by this administration

[lentulusgracchus]

BTW, if you were buying gas and the station was selling gas at ten cents per gallon, would you refuse to buy it if you found out the gas had been refined by Nigerians?

LOL -- takes me back to Trick Question 101. But thanx for the link; it reminds me to check my own portfolio.

As for low oil prices, well, we needn't worry about the price of crude falling out of bed anytime soon, not with world production rates plateauing and forming a secular top until about 2010......'course, accommodating all that burgeoning Chinese and Indian demand is going to be a bit, well, tense in a few years.

You've noticed Hu Jintao making a special trip to Mexico? Interesting, eh? Future wars will be about trade and resources, IMHO -- if we can quell the Islamists.

Ciao, have a good one.

[lewislynn]

Yeah, you're a closet communist. Except, the only one who thinks you're still in the closet is you.

Look who's calling the kettle black...The Communist are still in charge in China with your praise, help and constant support.

[#3Fan]

Bureau of Labor statistics: January 2001 Employment - 136.0 million January 2004 Employment - 138.566 million

Now, don't interrupt a good whine session with facts. lol

[PigRigger]

"And you know what? If Americans are that stupid, they deserve exactly what they get. They will be no better than the French...."

Agreed. And it will probably make things worse.

Unfortunately, a person facing the possibility of being outsourced may not be concerned, they may be only looking to survive as long as possible. And if there is large number in this boat, it may sway the election.

[dogbyte12]

You bring up an interesting point that I think needs to be addressed. It simply is a fact that we are no longer at 18 or 22 going to hire up at some company, work our asses off and 40 years later retire from the same place.

Our social construct had been built around that concept to a great degree. Our savings plans, our lifestyle choices were geared around that arrangement.

If you know that in all likelihood that you will be unemployed multiple times, yet at other times have very nice paying jobs, it changes the way you organize your life and your finances.

The one problem being is that we haven't. California is in the mess it is in, largely due to the fact that our fearless leaders assumed they could spend money assuming that the dot com tax revenues were going to keep increasing by the same margins every year.

A vast majority of american families appear to be operating on the same principle, when reality is something different. If you are an $80,000 a year engineer who is 30 years old, do you organize your life around the assumption that this steady stream of income will keep coming your way until you hit 60?

In a sense, I don't blame people. Their experience of having a parent work at the same job their entire life has colored their expectations. We all are going to be affected by this in one way or the other. Our housing values will decline, if there are too many foreclosures. It is an opportunity to some who want to get into the market, and a bane to others who are planning on selling.

In our government run schools, maybe they could do some good for a change and have a personal finance course in the 12th grade. We as a people need to simply learn that if you don't save enough money to make it a year without a job, you are setting yourself up for a world of big hurt.

[PSYCHO-FREEP]

John Kerry will only aggravate outsourcing, not stop it. He intends to increase business owners and corporate taxes on top of increase taxes on the people who earn over $250K.

He is as slick as Clinton in spewing his rhetoric and lies to convince the public he is a savior.

As far as blaming this President for all of this, he has very little to do with it and there is very little he can do about it. He tried a steel tariff to help the ailing steel industry, it had the opposite effect, it bankrupted many small companies and increased job losses. He had no choice but to lift the tariff.

In other words, Protectionism is BAD. I'll say it again....BAD!

[TomasUSMC]

We are now running 40 BILLION dollar monthly trade deficits. So, if we put a Tariff of 10 percent on everything that comes in, thats 4 billion a month, 48 billion dollars a year, into the U.S. treasury.

With that money we could buy AIDs medicine for Asia and Africa, and guarantee a college education to every Illegal Immigrant as well as paying teachers more to teach our children the evils of hetersexuality and family.