The Outsourcing Bogeyman

Foreign Affairs ^ | May/June 2004 | Daniel W. Drezner

[Steve Eisenberg]

When a presidential election year coincides with an uncertain economy, campaigning politicians invariably invoke an international economic issue as a dire threat to the well-being of Americans. Speechwriters denounce the chosen scapegoat, the media provides blanket coverage of the alleged threat, and legislators scurry to introduce supposed remedies.

The cause of this year's commotion is offshore outsourcing -- the alleged migration of American jobs overseas. The depth of alarm was strikingly illustrated by the firestorm of reaction to recent testimony by N. Gregory Mankiw, the head of President George W. Bush's Council of Economic Advisers. No economist really disputed Mankiw's observation that "outsourcing is just a new way of doing international trade," which makes it "a good thing." But in the political arena, Mankiw's comments sparked a furor on both sides of the aisle. Democratic presidential candidate John Kerry accused the Bush administration of wanting "to export more of our jobs overseas," and Senate Minority Leader Tom Daschle quipped, "If this is the administration's position, I think they owe an apology to every worker in America." Speaker of the House Dennis Hastert, meanwhile, warned that "outsourcing can be a problem for American workers and the American economy."

Critics charge that the information revolution (especially the Internet) has accelerated the decimation of U.S. manufacturing and facilitated the outsourcing of service-sector jobs once considered safe, from backroom call centers to high-level software programming. (This concern feeds into the suspicion that U.S. corporations are exploiting globalization to fatten profits at the expense of workers.) They are right that offshore outsourcing deserves attention and that some measures to assist affected workers are called for. But if their exaggerated alarmism succeeds in provoking protectionist responses from lawmakers, it will do far more harm than good, to the U.S. economy and to American workers.

[Poohbah]

ROTFLMAO!!! Marvelous! No, sir, you are incorrect. Mr. Karl Marx, my dear Poohbah - is in complete agreement with YOU! He was very much in favor of free trade!

Because he believed, as you do, that free trade destroyed the middle class and thus created the grounds for a worker's revolution.

So you're in agreement with Marx on economics.

And, as I've pointed out, the country that approaches your ideal economic model is North Korea.

[Fledermaus]

California, with it's high tax rates and over regulation, forces out the most productive while their population still grows (they gained a Congressional district in the 2000 Census) with low income and illegal aliens all using more and more overly generous government services.

You do the math.

[Fledermaus]

Nissan makes Altima's and Camary's (and will soon be making SUV's) in Smyrna, TN (non-union).

Mercedes just finished a plant in Mississippi (again, non-union).

All high paying jobs. I wonder about all the complaints of "outsourcing" in Japan and Germany.

[Fledermaus]

When eventually, you produce nothing, manufacture nothing, and service nothing...where are we?

Probably in an asylum for the insane since that's ridiculous.

A record number of American's are working today than ever before.

[Euro-American Scum]

California, with it's high tax rates and over regulation, forces out the most productive while their population still grows (they gained a Congressional district in the 2000 Census) with low income and illegal aliens all using more and more overly generous government services.

Is it any surprise that liberals win by a landslide out here. I'd be surprised if GWB makes so much as one campaign trip to this state.

Besides which, he proved he can win without it the last time out.

[Fledermaus]

Fighting tooth and nail to prevent us from "reclaiming" these jobs? (eye-roll)

We make those decisions, not them. Dell Computers brought back hundreds from India because of customer complaints.

And all of the "we'll have no jobs left" people obviously didn't even bother to read the long detailed article that this thread started.

It correctly pointed out the gazillions of things that CANNONT BE OUTSOURCED!

The knee-jerking on this issue is amazing. I guess all those knee-jerkers are doing nothing but reading "The American Conservative".

[Fledermaus]

Tariff increases? HA HA HA HA HA

Can you say Smoot-Hartley? Great Depression?

[Fledermaus]

What a ridiculous use of the Constitution. The document GUARANTEES freedom. And that includes the freedom to do business.

Have fun voting for Kerry.

[Fledermaus]

Yes, our trade deficit is large. But wait! How can that be? According to all you "the sky is falling" types we are all wallowing in poverty!

How could be possibly afford to buy billions of dollars worth of goods from other countries?

But if you want to pay $20 for a Happy Meal because the plastic toy is made in Ohio, fine. Don't cry me a river when you can't afford it.

BTW, how much did you pay for the computer you are using to post your crap? I bet it was A LOT LESS than you would have just 5 or 10 years ago! Open up the back and look at all those chips...Tawain, Japan, Mexico, etc.

I guess you'd rather computers remain $2,500 a piece so some uneducated sap can make $20 an hour putting a gromment in a hole.

Yeah, that makes sense. And where are those workers going to find a job when Dell and everyone else is out of business because no one can afford a new computer?

I wonder - do you volunteer to pay more for the products you purchase? I would seriously doubt it. If you are so concerned with one job sector over another then you should be willing to pay extra to protect those jobs.

But I'll bet you $100 you'd never walk into CompUSA and say, "oh, can I pay you another $250 for that TV so I can be happy some American has a job?"

Yeah, I'd love to see that.

[Fledermaus]

ROFL! Paul Craig Roberts drank for the poisoned Pat Buchanan punch years ago.

He's so discredited now he can hardly get published.

[Fledermaus]

BINGO! It's all about preferred special interest groups.

I can just imagine the panic and fear these people's great-grandparent's were going through as we moved from an agricultural base to a manufacturing base.

[neutrino]

But if you want to pay $20 for a Happy Meal because the plastic toy is made in Ohio, fine. Don't cry me a river when you can't afford it.

Utter nonsense. If offshoring accounts for 0.3% of the total jobs, it is inane (at best) to suggest that so large a change in the price structure would occur.

I wonder - do you volunteer to pay more for the products you purchase?

I purchase - to the extent possible - American made goods from American vendors. That sometimes means I pay a slightly higher price.

I would seriously doubt it. If you are so concerned with one job sector over another then you should be willing to pay extra to protect those jobs.

Your doubt is ill-founded. And I agree, we should be willing to pay extra to protect American jobs. I certainly am.

But I'll bet you $100 you'd never walk into CompUSA and say, "oh, can I pay you another $250 for that TV so I can be happy some American has a job?"

You'd lose your money. I purchase my computer equipment from a US based vendor - and likewise with other electronics. I have never purchased from Dell, if only because they don't offer the personal service I prefer.

There is more to life than getting the lowest price, or stacking up more cheap trinkets. If you can't understand that, then you have my sincere sympathy.

[going hot]

A Cadillac Sedan de Ville - which was 93% made in America. It was the highest percentage I could find at the time. I regret that it wasn't 100%.

I have never purchased or owned a foreign car. I intend never to do so.

And, Poohbah, I am curious - what kind of car do YOU drive?

It seems on another thread that GM is planning to outsource some of it's production to -gasp-save on operating cost.

You might wish to publicly sell your car and get another, to register your protest, as the car of your choice was made by a company who outsources.

[international american]

"California, with it's high tax rates and over regulation, forces out the most productive while their population still grows (they gained a Congressional district in the 2000 Census) with low income and illegal aliens all using more and more overly generous government services."

On this, I agree with you 100%. Boxer and Feinstein and Davis,along with the illegals have wrecked this state.

[BikerNYC]

Are they making cars here that are to be sent back to Japan and Germany? If not, I don't think they care.

[maui_hawaii]

Difference is between then and now I took a about a 65% pay cut.

[maui_hawaii]

Self regulation/invisible hand/market taking care of itself etc is a joke. Its applicable though...in fantasyland.

[maui_hawaii]

Thats not really the goal. No, not at all.

[Fledermaus]

I was referring more to the concept of low skilled manufactuing jobs when I mentioned the "toys".

Bad response and I didn't make myself clear. Sorry.

[Fledermaus]

Most are sold here in America. And I made an error...the Camary is a Toyota. I forgot the name of that other Nissan car they made for a while.