Nov 16, 2006

Jacob Weisberg was on Lou Dobbs

For years I've read hundreds of well written articles and reports about the presumed truths and falsities of outsourcing and the effects that foreign competition has on the American workforce.

The bulk of these articles, along with Mr. Weisberg’s comments, makes the point that outsourcing has been good for this country. Outsourcing allows American companies to be competitive with foreign enterprise. We need to face the fact that a healthy American company is better than no American company. Americans benefit from the lower prices that imported goods provides, as evidenced in Wal-Mart’s study that claims a savings of $2329 per year for the average family of four. Outsourcing also keeps America involved in a global economy. Our outflow of dollars creates jobs and builds economies all over the world.

Weisberg didn’t contend that this redistribution of jobs from this country to “somewhere else” is crucial for a compulsory workplace evolution. But it is a common assumption among people who favor globalization.

In my previous article I presented the notion that some of these writers were actually getting their pink slips in this latest round of newspaper layoffs. Even if the jobs being lost are not directly caused by outsourcing or foreign competition, they are still jobs that have been lost by some very dedicated and talented people. And I have to wonder if they have re-evaluated their attitudes on the subject.

Admittedly the positives of outsourcing and foreign competition can be compelling but we are not on a level playing field. If wages in India and China are a fraction of ours, and cost is the primary factor, then all labor in the United States is at risk. As the higher paying jobs are eliminated through outsourcing, then the pool for less skilled work is increased and wages are put under greater pressure. Add to that the large pool of immigrants and wages have nowhere to go. Once this downward cycle starts it can have grave consequences for the overall US economy.

At this time, with unemployment at 4.4%, the economy appears to be strong, but the truth is there are less people working today, as a percentage, than there has been since in 1991. In the last five years the medical field has added 1.7 million positions, the private sector has netted out at 0 new jobs. The last few years the housing market has carried the economy but it to, is weakening, and estimates run 300k to 900k layoffs in the near future. America was built by its manufacturing might, today our manufacturing infrastructure has been in a fifteen year downward cycle and there are no plans to change that.

I have faith in the American people but it can be a rough lesson if we don’t make a substantial commitment to support American jobs.