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Outsourcers Are the Bigger Job Creators?
By John Stossel for Jewish World Review
February 23, 2005
"Show us the jobs!" chanted union workers at an AFL-CIO rally protesting outsourcing. They were angry that "their" jobs were going overseas. So let's go look for the jobs that have disappeared.
ABC News asked the AFL-CIO for its best examples of workers who lost jobs because of outsourcing. The first people they told us to talk to were Shirley and Ronnie Bernard.
The Bernards used to work at a Levi's factory in Knoxville, Tenn. But then, Levi's sent jobs to Mexico and closed that plant. It "tore a lot of people up because some people have been here since they were 16 years of age, and they've been here like 20-something-odd years," one woman told the local ABC affiliate. People "were in tears," said a man.
"You've done something for 20 years, got up, went to work every day, and then all of a sudden you don't have anyplace to go, and nobody needs you anymore," Shirley Bernard recalled.
Lou Dobbs feels their pain. The CNN anchor has made outsourcing complaints a trademark of his show. "Just because of cheap labor, we're, we're destroying our middle class," he told me. "That is just stupid. Being stupid is un-American."
But it's restricting outsourcing that would be un-American and stupid. Outsourcing benefits the middle class by bringing lower prices.
Take clothing. Lots of it is made abroad these days and Lou Dobbs sees that as a terrible thing. "This country cannot even clothe itself," he says. "Ninety-six percent of our apparel is imported." I pointed out that this gives us more choices for less money. "When was the last time you bought a suit of clothes?" Dobbs responded. "Because if your prices went down, I would be shocked."
Shocked? OK, be shocked, Lou. The Labor Department keeps track of clothing prices, and its price index has been going lower and lower.
But what about all those jobs going overseas? Consider 50 people in India doing programming that people in California used to do. They work for a company called Collabnet, run by Bill Portelli. The salary for each Indian programmer costs him less than half as much as an American's salary for the same job.
Yet the Americans who work for his company didn't lose their jobs, because outsourcing saved Collabnet so much money, Portelli could expand in America. "Basically, I've created jobs in America," says Portelli. "I've built better products, created jobs, been able to raise salaries." Had he not been able to hire Indians, he says, he might even have gone out of business.
"Then he probably should be out of business," said Lou Dobbs, "because the fact of the matter is, either his business would be successful with American workers, or it's not going to be successful at all."
What?! The fact of the matter is, the most successful companies are outsourcers. And a Dartmouth study found that outsourcers are the bigger job creators.
Since 1992, America has lost 361 million jobs, but during that same time, it also gained 380 million jobs millions more than it lost.
"Oh, I love my job now!" That's Shirley Bernard talking the outsourcing "victim" the AFL-CIO wanted me to interview. At her old job at Levi's, the work was hot, noisy and physically difficult. Now, she's a secretary. She's paid more, too.
She worries about the long term, and she's still an opponent of outsourcing, but she admits that many of her co-workers have moved on to better jobs. "Some of them have got, really got excellent jobs that they would never have even left Levi's for if the plant hadn't closed," she says. "This kind of forced them to ... to make a decision what they wanted to do and ... and they're really happy at what they do."
When a worker is laid off, it's easy to see her pain. Here it comes down the news wire: Thousands of jobs vanish in a single day as a plant closes. The benefits of free trade are harder to spot; when one individual finds new and better work because free trade helped a company expand, it doesn't make the headlines.
Shirley's Levi's plant was featured in news reports as an example of the horrible damage done to an American community by outsourcing, but when we visited the site, construction workers were building a college there. Their jobs and all the other jobs created by the college won't make the evening news, but they're a product of outsourcing, too.
Stupid and un-American? Give Me a Break.
John Stossel is co-anchor of ABC News' "20/20."
© 2005, by JFS Pro
By John Stossel for Jewish World Review
February 23, 2005
"Show us the jobs!" chanted union workers at an AFL-CIO rally protesting outsourcing. They were angry that "their" jobs were going overseas. So let's go look for the jobs that have disappeared.
ABC News asked the AFL-CIO for its best examples of workers who lost jobs because of outsourcing. The first people they told us to talk to were Shirley and Ronnie Bernard.
The Bernards used to work at a Levi's factory in Knoxville, Tenn. But then, Levi's sent jobs to Mexico and closed that plant. It "tore a lot of people up because some people have been here since they were 16 years of age, and they've been here like 20-something-odd years," one woman told the local ABC affiliate. People "were in tears," said a man.
"You've done something for 20 years, got up, went to work every day, and then all of a sudden you don't have anyplace to go, and nobody needs you anymore," Shirley Bernard recalled.
Lou Dobbs feels their pain. The CNN anchor has made outsourcing complaints a trademark of his show. "Just because of cheap labor, we're, we're destroying our middle class," he told me. "That is just stupid. Being stupid is un-American."
But it's restricting outsourcing that would be un-American and stupid. Outsourcing benefits the middle class by bringing lower prices.
Take clothing. Lots of it is made abroad these days and Lou Dobbs sees that as a terrible thing. "This country cannot even clothe itself," he says. "Ninety-six percent of our apparel is imported." I pointed out that this gives us more choices for less money. "When was the last time you bought a suit of clothes?" Dobbs responded. "Because if your prices went down, I would be shocked."
Shocked? OK, be shocked, Lou. The Labor Department keeps track of clothing prices, and its price index has been going lower and lower.
But what about all those jobs going overseas? Consider 50 people in India doing programming that people in California used to do. They work for a company called Collabnet, run by Bill Portelli. The salary for each Indian programmer costs him less than half as much as an American's salary for the same job.
Yet the Americans who work for his company didn't lose their jobs, because outsourcing saved Collabnet so much money, Portelli could expand in America. "Basically, I've created jobs in America," says Portelli. "I've built better products, created jobs, been able to raise salaries." Had he not been able to hire Indians, he says, he might even have gone out of business.
"Then he probably should be out of business," said Lou Dobbs, "because the fact of the matter is, either his business would be successful with American workers, or it's not going to be successful at all."
What?! The fact of the matter is, the most successful companies are outsourcers. And a Dartmouth study found that outsourcers are the bigger job creators.
Since 1992, America has lost 361 million jobs, but during that same time, it also gained 380 million jobs millions more than it lost.
"Oh, I love my job now!" That's Shirley Bernard talking the outsourcing "victim" the AFL-CIO wanted me to interview. At her old job at Levi's, the work was hot, noisy and physically difficult. Now, she's a secretary. She's paid more, too.
She worries about the long term, and she's still an opponent of outsourcing, but she admits that many of her co-workers have moved on to better jobs. "Some of them have got, really got excellent jobs that they would never have even left Levi's for if the plant hadn't closed," she says. "This kind of forced them to ... to make a decision what they wanted to do and ... and they're really happy at what they do."
When a worker is laid off, it's easy to see her pain. Here it comes down the news wire: Thousands of jobs vanish in a single day as a plant closes. The benefits of free trade are harder to spot; when one individual finds new and better work because free trade helped a company expand, it doesn't make the headlines.
Shirley's Levi's plant was featured in news reports as an example of the horrible damage done to an American community by outsourcing, but when we visited the site, construction workers were building a college there. Their jobs and all the other jobs created by the college won't make the evening news, but they're a product of outsourcing, too.
Stupid and un-American? Give Me a Break.
John Stossel is co-anchor of ABC News' "20/20."
© 2005, by JFS Pro
