If he wasn't rasing an alarm, he'd have a harder time getting people to file in behind him, as if he was the solution to what he's rasing the alarm about.

How many times have we seen this before... even in the 2000 election?

As for your first point Dan, exports may be growing but so are imports:

http://www.bea.gov/bea/newsrel/tradnewsrelease.htm

Imports are at a higher absolute level than they ever were and the gap between imports and exports is higher than ever because even though exports grew, imports grew even faster.

http://www.msnbc.msn.com/id/4960726/

Even Greenspan doesn't deny that this is unsustainable forever, just in "Fedspeak" he notes in his testimony that it will be subject to a "market correction".

The devaluation of the US dollar relative to the Euro has merely positioned us a lower cost labor pool relative to Europe, it hasn't shifted the primary paradigm of globalism from competitive labor location shifting to actual net job creation.

In the second case of your point, I've pointed out that the BLS numbers are internally inconsistent. According to them, labor productivity from output inflation from offshoring declined after 1995 - when the practice was known to have accellerated. The fact that there is a break point at 1995 indicates that there was some sort of internal procedural change that shifted the numbers - pointing to the idea that the BLS projections are artifacts of whatever assumptions they've used rather than honest reflections on measured output.

Given that two of your assertions are shaky at best and vulnerable to further contra-evidence I'd say that your argument is missing two pretty important supporting pillars.

Oldman -- my first point had nothing to do with the balance of trade -- it was about manufacturing jobs.

My second point on mass layoffs is completely unrelated to the debate about outsourcing's effect on productivity measurement (where I also think your logic is a bit off, but that's a debate for another day).

I'm pretty confident in my pillars.

I just can't help but comment that the IBM managers who outsourced American jobs to Bangladesh never apologized.

Dan--

Microsoft, the world's largest software maker, has an R&D budget that is also one of the world's largest--some $6.8 billion for fiscal 2004. It operates research labs in China and the United Kingdom, but the bulk of its work takes place in the United States.

This comment is disingenuous in the extreme, given the aforsaid company's flouting of H1B visa regulations. Offshoring is not any less offshoring if the bodies are just brought into the US from offshore.

The jobs in dispute are still being preferentially filled with non-nationals.

This comment is disingenuous in the extreme, given the aforsaid company's flouting of H1B visa regulations. Offshoring is not any less offshoring if the bodies are just brought into the US from offshore.

The difference is gerater than you make it...Doesn't a goodly chunk, if not the total of the H1B worker's paychecks, get spent here? Are not the taxes taken here? Do not a vast majority of H1B's become citizens?

Dan Drezner refers to a Paul Krugman article written ten years ago---while he was still a sane individual. Are these his views today? I doubt that very much. As for Joseph Lieberman, the man is between a rock and a hard place on trade issues and just about everything else. He has been a lifelong Democrat. However, he should be giving his support to President Bush’s reelection efforts. It makes absolutely no sense for him to back the foreign policy wimp, John Kerry. Also, Lieberman is concerned about Israel. If this remains the case, then how can he vote for a Democrat presidential candidate? The very premise of that party’s position on Israel, especially since the era of Jimmy Carter, is that the Jews are responsible for half of the problems with the Palestinians. This is pure madness. Why hasn’t Senator Lieberman come to his senses like Zell Miller?

David,

Given their respective records, what they actually did or voted, no one who truly supports free trade can prefer Bush to Kerry.

Bush is the most protectionist president since Reagan (remember VERs?) while Kerry has voted for every free trade agreement he has had a chance to.

Dear Dan,

In March, the goods deficit increased $3.8 billion from February to $51.2 billion,... Exports of goods increased $2.3 billion to $67.2 billion, and imports of goods increased $6.0 billion to $118.4 billion

You give a spirited defense, but my point is that even though the export grew so did the imports meaning that even in an expansion the imported goods made inroads into the US domestic market. If imports grow during good times and bad times, something we've seen recently, then that's partial evidence of a structural trade deficit and not the cyclical one that is often claimed - especially if they grow faster than domestic growth of production.

As for point two, the discrepency in the BLS numbers goes to the heart of the case about whether or not there is a trivial amount of job destruction. I grant you that a full counter-case has not been fully substantiated yet, but if my life would settle down I would look into it!

As for your third case, the NYtimes has recently published an article showing evidence from scientific journals that the US is already being surpassed in scientific and technical knowledge creation.

I don't think that the #1 factor that threatens high expertise US jobs is offshoring, but simple labor technical expertise competition.

Of course this is a factor completely separate from trade, but it is important in that the focus on hi-tech jobs lost or gained through trade is not as important as hi-tech jobs lost or gained through the absence of qualified personnel. This is the claim of the industries who promote increases in H1-B visas is it not? That we don't have enough qualified Americans here to fill all the positions?

Thanks for your reply, and I am looking forward to writing more well researched replies as soon as my life calms down. Right now it's a whirlwind, but as soon as I can get to it, I'll try coming up with a counter case.

Department of Really Big Problems:

'Why wrap such sensible proposals around such exaggerated rhetoric? Because it's politically effective. ... While I'm very enthusiastic about the Senator's concrete proposals, I'm very, very queasy about the scaremongering tactics that are associated with them.'

Couple of comments:

Mr. Thomson, I had the opportunity to hear Paul Krugman speak in person at UNC a few weeks ago, and in his answer to a question about offshoring (the subject was not covered in his prepared text) I didn't note any difference in opinion than that expressed in the article Dan linked.

As for the question in general, I can mostly offer anecdotal evidence, having been in a position of having to lay off highly qualified IT professionals in favor of hiring staff in Asia. Without going into detail, we're not finding people with anywhere near the *experience* of the people that are being displaced (and I'll take experience over another training certification any day), turnover is extremely high due to the competition in the job market in India, Singapore, etc. (so don't tell me there's not a LOT of this going on) and we're still trying to figure out the logistics of really making this work. I really think this is another short-term thinking corporate fad - there may be companies doing this in a way that saves them money, but my guess is that most are screwing it up and not saving a damn thing (while losing any loyalty their remaining US employees might have had). My suspicion is that in the fairly short run (3-5 years), Indian (for example) salaries will rise to the point that it will become less attractive to move as much work over there (and China, Malaysia and the Ukraine won't be far behind). That doesn't mean that in the meantime, it won't be hellish for the indivifuals that have been (and continue to be) laid off.

Finally, as for the BLS numbers, a lot of this activity seems to be happening in such a way that it will fall under the 50 layoff radar line. Sure, moving a help desk may show up, but a lot of this is happening department by department (again, I can only talk from personal experience here) so it would likely not be reported.

Again, I'll admit that I'm not as versed in economic theory as some of you guys are - just offering what I've seen from the inside.

Oh, obligatory partisan comment - you guys are welcome to Lieberman - he's a punk and I have no use for him. But I want McCain in trade... :-)

Yes, the manufacturing jobs are not going now, they are mostly long gone (I consider Mexico and Canada offshore). The trend is repeating itself in the IT arena. However, you make salient points concderning the increases in productiviey. Are you familiar with the following article. I am not an economist either, and I appreciate your insights:

http://www.g-r-e-e-d.com/GREED.htm

GT wrote:

Given their respective records, what they actually did or voted, no one who truly supports free trade can prefer Bush to Kerry.

Bush is the most protectionist president since Reagan (remember VERs?) while Kerry has voted for every free trade agreement he has had a chance to.

Kerry has said that he would veto both the Free Trade of the Americas Act and the Central American Free Trade Act both of which Bush supports as well as everyone one of the trade agreements that Kerry has supported. Kerry also criticized the Bush administration for repealing the steel tariffs (which were not as large as the ones that Kerry favored at the time).

Bush then is still preferable to Kerry on trade.

Thorley,

You are comparing what Kerry SAID with what Bush DID. Why don't you look at what both DID?

Yes, Kerry ran a more left-wing primary but if you bother to check you'll notice he has left that behind. He is now surrounding himself with the DLC crowd and has clearly moved to the center.

Bush said a lot of free trade things when he was running for office but in the end he turned very protectionist. Kerry, on the other hand, may have said some protectionist things but has always voted free trade.

No matterhow much you may wish otherwise Bush has a protectionist record and Kerry does not.

GT wrote:

You are comparing what Kerry SAID with what Bush DID. Why don't you look at what both DID?

Yes, Kerry ran a more left-wing primary but if you bother to check you'll notice he has left that behind. He is now surrounding himself with the DLC crowd and has clearly moved to the center.

Bush said a lot of free trade things when he was running for office but in the end he turned very protectionist. Kerry, on the other hand, may have said some protectionist things but has always voted free trade.

You haven't paid attention.

His closest economic advisors are from the "Rubin" side of the Dems.

If you think that Bush is a free trader, be my guest. He isn't.

Kerry voted for all free trade he had a chance to.

Bush put in place protectionist measures.

GT wrote:

If you think that Bush is a free trader, be my guest. He isn't.

There are really no “free traders” in modern politics nor are there absolute “protectionists” there are only proponents of managed trade – a combination of trade liberalization with some elements of protectionism. Every trade agreement contains some elements of protectionism (usually for agriculture or some other industry) when it is negotiated or requires some form of political horse-trading to get it passed. Where candidates differ is based on the degree and mixture they prefer and Bush is on balance more inclined towards free(r) trade than his Democratic counterpart.

Kerry voted for all free trade he had a chance to.

Bush put in place protectionist measures.

According to this article in Computerworld, significant numbers of information technology jobs are moving offshore:

http://www.computerworld.com/managementtopics/outsourcing/story/0,10801,93217,00.html?from=homeheads

Care to comment?