The Rocky Mountain News yesterday ran an editorial excoriating Rep. Tom Tancredo for his stance against overseas outsourcing. Here's the meat of it:
So far as we know, Tancredo has yet to follow Sen. John Kerry's lead and indict executives who dare to invest overseas as "Benedict Arnold CEOs," but his rhetoric is creeping in that direction. We wonder if Tancredo and Kerry also believe corporations should be berated for replacing workers with machines. If not, why not? Automation forces many, many more workers, at least temporarily, "into lower-paying jobs" than outsourcing ever has. Meanwhile, though, the pursuit of efficiency through automation and outsourcing allows companies to invest far more in research and development, which in turn creates many more higher-value jobs.
As we noted at the outset, this process of "creative destruction" has worked economic miracles for more than 200 years. Americans today on average earn, after inflation, six times more than U.S. workers did just 100 years ago - even as a multitude of jobs and professions have been wiped out by automation and forms of outsourcing. But Tancredo, Kerry and many others now imply that this process of wealth creation has somehow run its course.
Nonsense. Job creation is indeed sluggish, but it simply is not true that the economy is being sabotaged by outsourcing.
Let me go a step farther and say the stance these two take is one of economic ignorance. The long term results of protectionism, whether of products or jobs, is to raise prices and suppress the economy.
Of course rhetoric isn't policy, and it's possible that Tancredo is merely grandstanding for the voters. It's still annoying to see an elected official taking such a position.
Posted by Walter at March 31, 2004 11:09 AM