There is talk, and some action, about outsourcing jobs that can
be done cheaper in foreign countries. At a time with high
unemployment rates in the United States, is it smart to be sending
“President Bush’s top economist, N. Gregory Mankiw, said last
week that outsourcing was ‘probably a plus for the economy in the
long run,'” reported the Washington Post last week.
Mankiw supports the theory of comparative advantage, which
argues that countries should specialize in the products they can
produce the cheapest and import everything else. So, as Mankiw told
Congress, “If a thing or a service could be produced more cheaply
abroad, then Americans were better off importing it than producing
it at home,” according to The Economist. “As an example, Mr. Mankiw
uses the case of radiologists in India analyzing the X-rays, sent
via the Internet, of American patients.”
It is true that this method has been shown to be successful in
the long run, but how does that help our economy right now?
Right now, people are out of jobs. Approximately 60,000 people
in the Denver metro area are searching for jobs right now,
according to Glennda Alcarez, from Arapahoe Douglas Works! How does
outsourcing jobs help these people right now?
This is the flaw in Mankiw’s plan. By sending more jobs
overseas, the economy may be slowed even more in the short run. The
economy needs more time to rebound. It is too early to be
aggressive with a still faltering economy.
Despite the fact that the business-funded Conference Board’s
research shows that the economy has been improving since last
spring, Ken Goldstein, the group’s economist, warns that bumps in
the road can still hinder the rebounding economy, according to the
“Consumer confidence could falter if job and wage growth don’t
continue to strengthen,” Goldstein said in the article.
It has been argued that outsourcing will not change anything
because it “accounts for a tiny proportion of the jobs constantly
being created and destroyed within America’s economy,” according to
the Economist. But tell that to the radiologist, to use Mankiw’s
example, who just lost her job to someone in India.
Regardless of how many jobs outsourcing takes away, it is still
taking away jobs at a time when they are desperately needed.
Outsourcing may be good in the long run, but taking these jobs
away hurts an already weakened economy right now.
Colleen is the managing editor for The Collegian. She is double
major in political science and technical journalism.