- Posted April 15, 2012 by
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iReport Debate: What’s your top issue?
Rethinking Off-Shore Outsourcing
There are a lot of problems with off-shore outsourcing. Jobs shouldn’t be treated the same as a commodity like oil and steel, bought and sold at the lowest price on the world market. Jobs are people. Manufacturing workers are consumers and tax payers. Their buying stimulates economic growth and their taxes help to balance budgets, pay for roads and schools, and support Social Security. Outsourcing eliminates these contributors to our economy and government, and sends them out to find something else that just isn’t there. What this practice brings to the country is an unemployment level that in the long term has no limits. There are no jobs to replace the jobs that are outsourced. If there are, where are they? There is no plan to address these realities or the resulting decay in human spirit.
The practice of outsourcing does more damage than just create unemployment. It exports American competencies, and builds competitors. It is so myopic it suggests either ignorance on the part of business leaders, or a deliberate “profits now” strategy that disregards the future. Manufacturing facilities are classrooms that generate new ideas, and teach design for manufacturing, quality, and low cost. Move the classroom out of the country and what was exceptionalism in innovation and design becomes mediocrity. It is paradoxical that reducing costs through outsourcing sows the seeds of long term business failure by damaging a rich, creative, hard working business ecosystem.
I know some businesses don’t want to outsource, but see outsourcing as the only way to be price competitive. Others do it simply to reduce costs and increase profits. Still others want to get rid of a hard to manage business activity and this leads us to the primary cause of outsourcing. The biggest reason companies outsource is because they can. Outsourcing has become very easy, a little bit too easy.
Businesses argue that outsourcing is a necessary part of “Globalization”, the church of their beliefs that cannot be questioned. But, if “Globalization” is examined, it really can’t work. There is no President or Legislature of the Globe to keep things on an even keel. There is no captain and there are no rules.
In our politics for the upcoming November election what screams loudest to me is what is not being talked about: the fact that outsourcing creates unemployment. It seems a contradiction that the leading Republican candidate who is supported by some of those doing the outsourcing says that lower taxes and smaller government are the answer when outsourcing places an upward pressure on taxes and a demand for bigger government. People who don’t have jobs, don’t pay taxes so the remaining tax payers will have to pay more, right? And those who are unemployed will want more government to assist them, right? I don’t think Romney knows what is going on. I think Obama does because the White House recently hosted a forum on Insourcing.
So what should be done? Jobs are the number one priority, and since outsourced jobs already exist, the quickest way to kick start the economy is to bring back as many of the outsourced jobs as possible. Higher employment brings more consumer confidence and people with money in their pockets to the marketplace, so businesses should be motivated. Since people with jobs buy houses, the housing market will probably improve too. The next step is to bring rules and leadership to Globalization and the practice of outsourcing. The goal should be to limit outsourcing unless the country is at full employment, say a 2 or 3% unemployment rate. Businesses and government will have to work harder and smarter to accomplish this but it can be done. For those who would oppose this I would remind them of the paradoxes of economic thinking and that all good does not emanate from the “profit motive”. I would also remind them that “free enterprise” does not come without responsibility to a nation and its people.