Really, tell that to the highly educated IT professionals who lost their jobs to cheap Indain workers-in India and the US (cheap guest workers). The idea that if only we became a more educated workforce...is untrue. We must become a cheaper workforce-as in like third world workers-willing to subsist on scraps tossed to us by wealthy multi-national types.
The presence of an "undocumented" - illegal - workforce in the US is primarily a political problem, not an economic one. Neither political party wants to deal with it, because of the benefits such workers provide to businesses (increased profitability) and to consumers (lower prices). At the same time, the longer-term costs of our current "temporary guest worker" policy are becoming apparent each day: exploding welfare costs, crime, drugs, and even the threat of terrorists taking advantage of unsecured borders.
When the costs of this policy outweigh the perceived benefits, Congress will finally act. That day is coming - hopefully before we receive another painful lesson about the dangers of open borders. At the same time, potential American replacements for these jobs exist in significant numbers - but our endless panoply of Federal (and state) welfare programs greatly reduces the incentives they have to work. And so the jobs go to those who will.
As for IT professional jobs being outsourced to India - that is primarily an economic issue, but one with some political causes. For one thing, these are largely jobs being created - not moved. The reason India is attractive for this purpose is the presence of a large English-speaking community and significant numbers of technical professionals being educated by schools in that country. Employment costs are far lower, too; though as demand for these workers rises, so will their salaries.
The cost of American workers is inflated not only by the differential in wealth, but by government mandates - payroll taxes for SS/Medicare, health care and legal expenses. These things are unlikely to change in the short run, so American service employees must have other advantages to allow companies to want to hire them - and they do. American workers are far more productive than their outsourced counterparts. They are easier to manage, culturally-assimilated, and more adaptable to changing priorities. ( I could cite several studies on this, but let's keep it brief).
Among the advantages American workers do not currently possess in great enough numbers is education - and that needs to change. Where foreign workers make economic sense, they will be used - and ought to be. Foreign companies hire Americans all the time, and for the same reasons.
Finally, most jobs today are not being created by large multinational corporations. They are the result of small business generation, most of which is happening right here in the US, and these new businesses are largely hiring American citizens, not foreigners. In summary, the demand for skilled labor outstrips supply, while the demand for unskilled labor is being depressed by the presence of an alien army. These are not unsolvable problems, but they cannot be addressed by pretending that we live in a vacuum, or that by closing our borders to illegal aliens, we can close them to free trade, and still thrive.