The American Business Model

As I was driving home for work this morning, I heard a news story about someone named Donohue who was for outsourcing jobs. Luckily Josh Marshall had the link I was looking for:

U.S. Chamber of Commerce President and CEO Thomas Donohue is promoting overseas outsourcing of jobs as a way to boost the economy and even increase employment - a stance that rankles jobless white-collar workers, particularly in the flagging technology industry.

Donohue, speaking Wednesday night to the Commonwealth Club of California, said he believes exporting high-paid tech jobs to low-cost countries such as India, China and Russia saves companies money that they may use to create new jobs for Americans.

CEOs from Wall Street to Silicon Valley have embraced the theory, and the pace of offshoring has shocked statisticians and economists.

In early June, the Bureau of Labor Statistics downwardly revised projections for white-collar job growth for 2002-2003, based on accelerated job migration. The agency reported that seven of the 10 occupations expected to gain the most ground are low-wage occupations that do not require a college degree.

(snip)

Donohue acknowledged the pain for people who have lost jobs to offshoring - an estimated 250,000 a year, according to government estimates. But pockets of unemployment shouldn't lead to "anecdotal politics and policies," he said, and people affected by offshoring should "stop whining."

Stop whining indeed. These companies need to send the high paying jobs overseas so they can hire you as a low paid, maybe even part time receptionist or night watchman. There are always plenty of listing for janitorial services in my local paper, or fry cooks at fast food places. And Wal-Mart... well, never mind about Wal-Mart.

Am I the only one who sees the flawed logic here, though? The flawed logic in saving money by shipping jobs overseas in order to create jobs here? I guess job loss coupled with job gains a few months later would indeed create the perception of job growth. It seems like some steps would be saved if we just never sent the jobs out in the first place. Maybe I should go back to school for economics to understand this better.