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March 23, 2004
The outsourcing bogeyman
Daniel Drezner tackles the "Outsourcing Bogeyman" in the latest edition of Foreign Affairs.
Summary: According to the election-year bluster of politicians and pundits, the outsourcing of American jobs to other countries has become a problem of epic proportion. Fortunately, this alarmism is misguided. Outsourcing actually brings far more benefits than costs, both now and in the long run. If its critics succeed in provoking a new wave of American protectionism, the consequences will be disastrous -- for the U.S. economy and for the American workers they claim to defend.Daniel W. Drezner is Assistant Professor of Political Science at the University of Chicago and the author of "The Sanctions Paradox." He keeps a weblog at www.danieldrezner.com/blog.
No responsible economist--no intelligent person for that matter--thinks that outsourcing of jobs is a reasonable explanation of the loss of American jobs under George W. Bush. On the contrary, less than 1 percent of jobs has been outsourced in the last 4 years.
Since John Kerry is also a supporter of free trade, and opposed to protectionism, the attempt of conservatives to paint Democrats as opponents of outsourcing must be something in the way of creating a straw man.
Even if outsourcing was responsible for a temporary dislocation of labo (something by no means certain) most intelligent analysts agree: protectionism would only hurt American companies and investors.
Opposing outsourcing is like opposing the weather. No one who is in favor of protectionism is intellectually serious. Why do Republicans insist on portraying Democrats as protectionists?
Indeed, it is amusing to note that the two most famous current Protectionists are both Republicans: Pat Buchanan, and Loug Dobbs.
Well you are right to agree with me on the economics of outsourcing but your reflexive hatred of conservatives has made you totally blind to the reality here. Republicans aren't portraying Democrats as protectionist, the Dems are doing a good job on their own. While is it true that Republicans haven't been immune to the protectionist urge (Dobbs has gone off the deep end, Buchanan has always been a maverick and Bush's steel tarrifs weren't his finest hour) by far the Democrats, ever the lap dogs of their union supporters, are the most protectionist. Kerry has been complaining about NAFTA for goodness sake. You obviously didn't read the piece. Here's an excerpt that you missed. While no one with intellectual honesty would advocate this protectionism, as this piece points out the political temptation is too strong, and the Dems fall prey first. Here's the excerpt:
"It should come as no surprise, then, that politicians are scrambling to get ahead of the curve. During the Democratic primary in South Carolina -- a state hit hard by the loss of textile jobs -- billboards asked voters, "Lost your job to free trade or offshore outsourcing yet?" Last Labor Day, President Bush pledged to appoint a manufacturing czar to get to the bottom of the outflow of manufacturing positions. In his stump speech, John Kerry bashes "Benedict Arnold CEOs[who] send American jobs overseas."
Where presidential candidates lead, legislators are sure to follow. Senator Charles Schumer (D-N.Y.) claimed in a January New York Times op-ed authored with Paul Craig Roberts that because of increased capital mobility, the law of comparative advantage is now null and void. Senator Tom Daschle (D-S.D.) has observed, "George Bush says the economy is creating jobs. But let me tell you, China is one long commute. And let me tell you, I'm tired of watching jobs shift overseas." Senator Christopher Dodd (D-Conn.) and Representative Nancy Johnson (R-Conn.) are sponsoring the USA Jobs Protection Act to prevent U.S. companies from hiring foreign workers for positions when American workers are available. In February, Senate Democrats announced their intentions to introduce the Jobs for America Act, requiring companies to give public notice three months in advance of any plan to outsource 15 or more jobs. In March, the Senate overwhelmingly approved a measure banning firms from federal contracts if they outsource any of the work overseas. In the past two years, more than 20 state legislatures have introduced bills designed to make various forms of offshore outsourcing illegal."