The Harsh Truth About Outsourcing

No one will do anything about outsourcing because, the companies that get the maximum benefit are American ones - member of the US Chamber of Commerce and have the strongest lobby group in the country. It does not have to be all or nothing proposition. All our government has to do is keep the high value production at home like Japan, Germany, Korea and to certain extent India do. It is that balancing act that would solve our economic crisis without making enemies out of our friends.

It is not difficult to do, but you need really smart surgeons and not a bunch of Lawyers and asking them to do liver transplants. Yet, that is where we are!And average people, lacking critical thinking skills, are dumb enough to fall for it.

Mr. Heffner is absolutely correct is stating that outsourcing is harmful to our economy and to our country.

Our government effectively bans the importation of vehicles that don't meet our emissions requirements, yet fails to stop the importation of toys dipped in lead paint and seafood grown in sewage ponds.

H. L. Mencken said, "The entire aim of practical politics is to keep the populace alarmed and hence, clamorous to be led to safety, by menacing it with an endless series of hobgoblins -- all of them imaginary." He might have added: "while they ignore the real threats."

I would be interested in hearing from one politician, currently serving in Congress, who recognizes the danger of outsourcing and who has made a significant effort to do something about it.

Bruce Bishop

Unless exchange rate manipulation is addressed which is a country printing new money out of thin air faster relative to a trade partner then the outsourcing will keep continuing with the special interest that believe in protectionist trade called free trade saying its cheaper overseas. Of course they won't mention why its cheaper, they will just say Americans are not educated enough. When classical economists talked about free trade and comparative advantage they were referring to a time when a large amount of countries were using gold as money so that no country could cheat and cause themselves a price advantage by printing money out of thin air.

All of the study and exquisit language to describe what is happening to our country in terms that sound as if those in power actually believed these theories of trade are nothing but a fancy way to describe "GREED." Everything that is said, everything that is done, is said and done for one purpose, and that one thing is MONEY, and of course the power to control others. Plain and simple. Let's not complicate mans basic nature. The answer is as simple as the nature of the problem. "love your neighbor as yourself."

It's important to remember that Free Trade Agreements only really reduce tariffs. Every other barrier under the sun like currency manipulation is not addressed. Nowadays it's hard to tell the reason why a foreign good is cheaper. Is the good cheaper due to a foreign competitor having a better product with better technology to make the product cheaper, is it maybe a poorer quality product, or does the foreign trade competitor create new money faster to depreciate their currency faster so that production is cheaper relative to other trading partners? Nowadays outsourcing is actually a bubble. Outsourcing depends on continued world inflation where the country that creates new money faster becomes the cheaper relative location to produce. Instead of producing in Asia companies could make the case that Zimbabwe which underwent hyperinflation is the cheapest country to produce in. Thats why countries like China have accumulated 3 Trillion of currency reserves because of government management of the currency where for every dollar it receives in exports it prints new Yuan to exchange for those dollars with its exporters where it then purchases US Treasuries with those dollars. This policy keeps the exchange rate fixed and allows products made on Chinese soil to be artifically cheaper. Currency manipulation is protectionism. The ideas of comparative advantage were at a time when money was sound and backed by gold where if every country in the world was on the same monetary standard then the country that could produce a particular product the cheapest should specialize in that product production. It wasn't mean't to be applied to a fiat monetary system where a country that prints new faster becomes the cheapest producer.

"Outsourcing is driven by absolute advantage. Asia has an absolute advantage because of its vast excess supply of skilled and educated labor."

Most of whom were trained at USA graduate schools! Thanks to liberal America and greedy Universities.