When Outsourcing Is (Not) Good For US Workers
by Seth Sandronsky

February 28, 2004

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In America, those who work or are struggling to find it are catching hell.

The jobless recovery, plus state and local government spending cuts are helping to depress wages as the cost of health care soars.

Some U.S. political elites and media commentators smell blood. Their talk reflects this feeding frenzy.

Take the rhetoric in February on the shifting of stateside jobs to low-wage countries. Two of them are China and India, where U.S. corporate investment is helping to turn former peasants into wage workers, a thrust of capitalist imperialism.

N. Gregory Mankiw, who heads the Council of Economic Advisers at the White House, said on Feb. 9 that in the long run the moving of U.S. jobs abroad will help the national economy. As the top economist for the Bush administration has explained, such outsourcing is a case of short-term pain for long-term gain.

Presumably, the short-lived pain will not last too long. A recent report by the CEA said the U.S. economy will generate 2.6 million new jobs, or 450,000 each month on average, this year.

Feel better now? The CEA forecast, if it comes true, will be a reversal of the past three years of job losses.

“If” is the key word. Of course if “ifs” were fifths, we would all be drunk.

Soberly, then, we turn to the Feb. 10-11 testimony to Congress by Alan Greenspan, chairman of the Federal Reserve Bank. He basically agreed with Mankiw’s view of outsourcing U.S. work as a necessary way to expand world investment and trade.

Other than that Mrs. Lincoln, how did you enjoy the play?

In the meantime, Nicholas D. Kristof of the NY Times, cheered the departure of U.S. employment to foreign countries. “Outsourcing raises American productivity, gives our economy a boost, increases foreign demand for U.S. products and leaves us better off,” he wrote in his Feb. 11 column.

Well, U.S. manufacturing workers have increased their productivity the past two years. Put another way, their exploitation on the job has risen.

Crucially, these productivity gains are not boosting the take-home pay of U.S. factory workers. Thus they are not “better off.”

In addition, their increased output has not stopped the decline of factory work. It has fallen for 42 consecutive months.

Kristof is also way off on outsourcing as a way to boost foreigners’ buying of U.S. products. For that to happen, the value of the dollar would have to continue to fall.

In that way, American exports become less costly abroad. Is Kristoff having an intelligence failure of sorts?

More likely, he is just voicing a hazard of official punditry—to echo the chant of capital’s political representatives. Kristof, Greenspan and Mankiw are placeholders for an ownership class that wants less government protection for U.S. workers to expand the return on corporate investment.

In the official view, U.S. government protection for the nation’s workers is the road to the ruin of the global trading system. By contrast, U.S. government protection of corporate copyrights and patents is a non-issue for Kristof, Greenspan and Mankiw.

Such a framework reveals the class lines within the world’s only superpower. The politics of that class division are driven by economic relations.

This is a relational process. American workers and their families are embedded in such class circumstances from the time of their entry into the world.

On that note, opinion polls are showing that Main Street is now souring on the issue of outsourcing U.S. work abroad. That perception, based on concrete living and working conditions, is worthy of attention before, during and after political elections.

Seth Sandronsky is a member of Peace Action and co-editor with Because People Matter, Sacramento’s progressive paper. He can be reached at: ssandron@hotmail.com

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