Job outsourcing comment draws Congressional wrath

[jean]

Comment on 'Outsourcing' Draws Congressional Wrath

February 12, 2004
http://www.cnsnews.com/ViewPolitics.asp?Page=%5CPolitics%5Carchive%5C200402%5CPOL20040212b.html

::snip::

Rep. Walter Jones (R-N.C.) is calling for the resignation of Gregory Mankiw, who chairs the White House Council of Economic Advisers.

Jones represents an area of eastern North Carolina that has seen significant job loss in the last year. He said he was infuriated and shocked to read a Washington Post article quoting Mankiw as saying that outsourcing U.S. service jobs to workers overseas is good for the nation's economy.

"Shipping jobs to low-cost countries is the 'latest manifestation of the gains from trade that economists have talked about' for centuries,'" the newspaper quoted Mankiw as saying.

"If he was accurately quoted, I respectfully suggest that you replace him with someone who understands that job loss in America is not something to be celebrated," Rep. Jones wrote in a letter to President Bush.

"Anyone who believes it's a good thing to ship U.S. jobs overseas and to send Americans to the unemployment lines should not be advising the President of the United States," Jones said.

House Speaker Dennis Hastert also issued a press release criticizing Mankiw's comments on outsourcing as a "new way to do international trade."

"I understand that Mr. Mankiw is a brilliant economic theorist, but his theory fails a basic test of real economics. An economy suffers when jobs disappear," Hastert said.

"Outsourcing can be a problem for American workers and for the American economy. We can't have a healthy economy unless we have more jobs here in America."

::snip::

[Sagan]

1. the rats are scrambling

They know that the jobs issue will hurt a LOT of their incumbent legislators.

[54anickel]

2. Wow, I'm feeling rather bi-polar reading this one

On the on hand you have a rally behind the working class:

"I understand that Mr. Mankiw is a brilliant economic theorist, but his theory fails a basic test of real economics. An economy suffers when jobs disappear," Hastert said.

On the other a rally that sounds as if it's to rally around the capitalist cronies:

"We will continue to fight to keep taxes low, to do away with frivolous lawsuits and to cut the cost of health care, so our manufacturing sector can keep more jobs here in America," he said.

Guess it would depend on what he means in that second quote.

[FlaGranny]

15. That's an easy one -

Keep taxes low for corps, keep people from sueing corps when they screw up, cut the amount companies pay toward medical insurance, so our manufacturers can keep more servants. That's what he really means.

[54anickel]

21. Pretty much what I figured. Was just hoping that maybe once, there'd

be a more humane voice of reasoning. You know, low taxes for working class, stop "frivalous" lawsuits, cut the healthcare cost burden on the working class thru whatever means.

Maybe someday.......

[mhr]

3. It's About Time!

Last May, I visited the offices of

Senator Cornyn,
Senator Hutchinson, and
Representative Sessions.

All of the above are republicans from Texas and unfortunately my national representatives in Washington.

At each office, I said the same thing.

"We have a national problem in this country that I would like to speak with you about today. Before I begin I would like to set the stage."

I reached into my briefcase and pulled out my:

BSEE and laid it on the table,
DD214 (honorable discharge) and laid it in the table,
MBA and laid it on the table, and
Commercial Pilot certificate.

I then said "I don't show you this to impress you, but we have a national problem when someone with this level of education, training, and experience cannot find gainful employment."

In each meeting, this was followed by stark silence. You could here a pin drop on the carpet.

In each case, there were no responses to the problem.

After each meeting there was no follow-up correspondence other than my thank you letter expressing gratitude for listening.

The lesson from the above: the republicans are essentially indifferent to the loss of good American jobs and the erosion of the middle class.

[joeunderdog]

5. But who will have the money to buy their widgets?

Let the Repugs embrace outsourcing like they did getting rid of OT.

We'll vote on it in November.

[pop goes the weasel]

17. Cornyn and Hutchinson are useless

What's really sad is that I find myself hopeful that the rumors are true that Hutchinson will fight Good Hair for the governorship. Man, have my expectations fallen.

[yolatengo]

4. "it's fine...

to actually OUTSOURCE, just shut your yap about it" -- New GOP Slogan

We don't want these RUBES to know we're shipping all their jobs overseas
to fatten our profits and dividends! They need to know about Janet's boobs,
Guard duty 30 yrs ago, and gay marriage. They DON"T need to know we're
laughing right in their faces as we transfer their jobs overseas and their
wealth to ourselves.

Christ, why can't these f*cking p*ssies just SAY IT. "Screw you, Bubba -
you keep right on voting for us because you hate fags and love guns
and we'll keep getting richer at your expense! What're you gonna do about
it? Vote for a baby-killing fag lover like Kerry?"

Bigby

[Turbineguy]

6. They just need to requantify.

I was doing a little reading over the last few months and came up with an idea that just might work. In fact, I am amazed that Karl Rove hasn't appeared to have thought of this yet. That's right. They are not being truthful about what they are doing about the Trade Deficit. They are failing to recognise that they are actually solving this problem.

One of the items that is being exported is jobs, but the Bush Administration is overlooking the benefit of this. They should be using this to their full adavntage. Here's how:

Since Bush has been in office about 3 million jobs have been lost. Most of these have gone to other countries such as China. This is a valuable export! Now these are high pay jobs, let's say $75,000 per year on average (including bennies). Now we all know that a dollar of employment is 5 dollars of economic activity. Therefore the value of this export is on the order of 450 Billion per year!

Our most valuable single export is not being counted!

Now some of you smartie pants analytical skeptics might think that this is the most bogus piece of economic reasoning since Karl Marx told us how we could all be much happier by following His Plan, but consider this:

This actually brings our real Trade deficit down to 150 Billion per year. Certainly a managable figure. This could be reduced by selling the National Parks or perhaps The Mall. I would not mind having a condo overlooking the Reflecting Pool and within walking distance to the Smithsonian. The title would be held by my Bahamian registered corporation. Naturally.

(sarcasm switched off)

Vote these idiots out!

[trogdor]

10. You're reading my mind.

That's like saying * wasn't AWOL because his commander didn't prosecute him for it - which is sort of like giving permission.

That's also like saying Biggus Dickus and Fat Tony hunting ducks together don't constitute a conflict of interest because Fat Tony was going to vote Biggus Dickus's way anyway.

Your piece is precious, though.

[teryang]

7. Greenspan full of it

On addressing the issue of outsourcing jobs and the declining income of the "lower 80 percent" (Sen. Corzine) and the failure to address a new paradigm in international trade theory (Sen. Shumer), Greenspan (who appears to be getting largely out of date), brings up Adam Smith and individual achievement in the classroom.

If there are 5 million qualified software engineers in Asia willing to work for 20K a year, no amount of education is going to save American jobs in this area. When you open the domestic labor marketplace to unprotected competition from abroad, where the populations of highly literate and trained personnel are enormous, wages and labor markets are going to collapse domestically.

The state has to play a role in protecting its standard of living at home. Blind adherence to ideological notions of free trade and self correcting markets will be diastrous. The middle class of India, which is highly literate, is larger than the entire population of the US. Fortunately, the language barrier in China is still too great; when they master the english language, a world wide depression in labor will occur and American skilled jobs in some sectors will be completely wiped out.

Also Greenspan goes on about the benefits of education and individual achievement while ignoring the issues of supply and demand.

Corzine brings up the issue of US debt being held disproportionately in offshore Caribbean banks and Greenspan is dumbstruck. This has to do with US multinationals moving their profits offshore in sham transactions in order to avoid US taxation. These corporations are using American markets and infrastructure but not paying taxes.

Yet, Greenspan goes on at length about the benefits of law in encouraging commerce and economic growth when what we have is a manipulative, corrupt marketplace lacking entirely in integrity.

[iam]

12. Only one real solution in my opinion,

Levy tariffs on foreign countries that will raise the cost of product being shipped into the US to roughly equal to the cost of the same product manufactured domestically. This will level the playing field. In order to lower the tariffs, foreign countries, can raise their standards of living to roughly what ours is. A sliding scale will eliminate all tariffs once equity is reached. Everyone benefits. Foreign workers get hefty pay raises and buy American goods with it and American workers get to keep their jobs. Simple. Now if we can get our capitalists who own our politicians to agree.

[AffirmativeReaction]

20. Tariffs are not a good idea

Protectionism is not the way to go, except in the interest of national security (Like the steel industry, for example. It's essential that we be able to manufacture steel for national defense.) Tariffs do nothing more than support failing or inefficient companies. Look at the auto industry in the late 60's and 70's. Once our markets were opened up to Japanese imports our automakers got hammered. The quality was poor, competition was limited, and R&D was stagnant. Chrysler very nearly went out of business. Many jobs were lost in the auto industry in the 1980's, and many people lamented the fact that Japan was going to own America within a few years. Guess what happened? U.S. companies responded. At first it was painful, as jobs were shed or moved to Mexico, new designs were drawn up, and quality slowly improved. Eventually the U.S. automakers recovered and caught back up with the Japanese. Now they are almost equal in quality. Tariffs merely allow flawed businesses to continue producing an inferior product.

14. Several resignations are needed--Fed Reserve, US Treasury

Check out the analysis on my website.

Dan

[54anickel]

16. Great post! n/t

[proud patriot]

8. Good for him

:thumbsup:

[FloridaPat]

9. Why is it everyone tells Bush who to fire, but no one

suggests he quit? Bush signed the document. Bush promised the Indian countries he would do all he could to keep the jobs going to India. They all should be fired. Then the big fish should be put in jail for treason and war crimes.

[shawn703]

11. The Repugs in the Leg and Exec branches will be outsourced soon enough

Come November. The American people will "outsource" their jobs to the Democratic Party.

13. Check THIS out

PRESS RELEASE
Citizens for Corporate Accountability

-Serious Problems With 02/11 Federal Reserve Testimony

(SEATTLE) 02/12/04 - Alan Greenspan says a continuing worry is that the Fed policy could become "improperly calibrated" to economic developments. Indeed--"fedspeak"--what does he mean?

It turns out, in the past when the Federal Reserve has failed, it is because their moves to affect the economy have not worked for one reason or another (for example, failing while lowering target interest rates in order to achieve higher employment--sound familiar?) . Such failures tend to end badly. Perhaps even, like the 1970s, a period of "stagflation", or more like the present-- periods of alternating stagflation and deflation, relying heavily on borrowing at both the federal and consumer level.

Greenspan also mentions that currency-related changes to profits have been temporarily offset by currency hedging activities. He mentions foreign companies--but neglects to mention similar effects related to domestic companies, faced with, among other things, skyrocketing aluminum, copper, and energy prices, all coming at the same time. Forget about new hires--how can companies like GE, Boeing, and Caterpillar operate at all domestically, once currency/inflation hedging runs out? The most recent manufacturing survey ("ISM") shows a prices paid component not seen since right before the 2000 stock market crash. In short, US inflation creation is far outrunning job creation--and apparently, running US jobs offshore in the process. Might this be an example of Greenspan's "improper calibration"?

What Greenspan doesn't mention is more interesting--the effect low interest rates have had on foreign economies--sending several foreign stock markets into bubbles, which dwarf those of the 2000 bubble. Thailand, Brazil, Turkey...the list is long. A bubble is one type of "improper calibration."

Finally, it is striking to see a headline claim of "vigorous growth ahead"--if that were truly the case, interest rates would not be at multi-decade lows. After all, it is a long, long way up to a "normal" interest rate environment--the only way from down this low, is up. Something clearly is "improperly calibrated" between what the Fed is saying about the economy, and what interest rates are set to.

Face it Greenspan, problems go way beyond the federal deficit. Lending and equity growth in US markets is way, way ahead of an economic reality that is not only way overdue, but may never materialize.

The sooner the US admits it has a stock market and lending market appropriate for an economy with two to eight million more jobs--instead of less--the closer the economy will be to a sustainable recovery. The Fed cannot fix the mess the Bush administration created--a fact both liberals and conservative Republicans increasingly understand.

[indepat]

18. One of the very few times, maybe the first, that I've agreed with Hastert:

advanced economic theory neither puts food on the table nor pays the mortgage.

[ProfessorGAC]

19. Two Illuminating Quotes

First One: "Shipping jobs to low-cost countries is the 'latest manifestation of the gains from trade that economists have talked about' for centuries,'" the newspaper quoted Mankiw as saying.

Economists have been talking about this for centuries? How many centuries, Greggie? One? Secondly, applying mercantilist financial principles to the modern macroeconomies is a fools' game, so if they've been saying this for more than 40 years, it's meaningless anyway. Thirdly, it fails to recognize that the growth of GDP is inextricably linked to the median income and the saturation of employment. IOW, typical people having good paying jobs is not only better for the economy, but most of these corporations had their best periods of profitability and growth while they were paying higher wages. There is no causative link between sustainable economic vibrance and low wages. The data show the exact opposite to be true.

Second One: "I understand that Mr. Mankiw is a brilliant economic theorist, but his theory fails a basic test of real economics. An economy suffers when jobs disappear," Hastert said.

A brilliant economic theorist who thinks that exporting jobs and shrinking the base of the middle class is a good idea? That's brilliant? Why don't these guys take off the gloves and suggest that whatever school gave this moron a Ph.D. in economics lose all federal funding, because their standards are too darned low.

Based upon my thoughts on the first quote, i would say that this guy knows as much about macroeconomics as my dog. Probably less.
The Professor

[Gin]

22. brilliant????????? he sounds pretty stupid to me.

gin

[ProfessorGAC]

23. I Think That's What I Was Driving At

Another two dimensional thinker who looks at one set of data from one angle, sees a line between X and Y, and says he understands.

This guy is far from brilliant. More likely he's as dumb as a stump.
The Professor