Out of Control Policy Blog

Your job isnít moving to Bangalore

Think all Democrats oppose outsourcing–a.k.a international trade? Well no one's a bigger Democratic honcho than Bill Clinton, and he pushed for NAFTA. Jagdish Bhagwati thinks Kerry has made a political error by whipping up outsourcing fears:

By playing to the understandable but incorrect fears of American workers that outsourcing is "taking away" jobs from Americans, he is painting the Democratic Party into the wrong corner on trade issues.

As Bill Clinton showed the country, there is a way for politicians -- even Democrats -- to explain the benefits of free trade. They could start by explaining that service imports fall broadly into two types. The first is made up of the simple, labor-intensive services like answering complaints, solving basic computer problems by taking customers through defined steps on the phone, or interpreting results of routine medical tests.

Bhagwati also thinks Kerry made an economic error:

In a world economy, firms that forgo cheaper supplies of services are doomed to lose markets, and hence production. And companies that die out, of course, do not employ people.

Ted Balaker is Producer


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