Dean,

Good points - and I loved that in the WSJ as well. It is telling that Dean considers "self employed" as a problem. Its also interesting that he thinks that the gap between rich and poor is an issue.

Howard Dean side-stepped the real issue. If he knows what it is he probably wouldn't want to offend any corporate sponsorship he has.

I would like to know where Dean Esmay found that stat. It sounds about right.

If offshore outsourcing is not addressed by government in the next year we will loose middle-class wealth as jobs in technology, medical, pharmaceutical, legal, journalism, printing, finanace, accounting, insurance, human resources, marketing, sales, real estate, goto Outsourcing Suppliers.

This will effectively relocate the bulk of American middle-class wealth to other countries.

Then goto Chief Excecutive, do a search on Outsourcing and see that CEOs don't even consider it an issue. You can always do a search on Google for "offshore outsourcing" or hit my weblog and dig through the research I've done ("All nyc99 American Jobs Posts" link on the top right.

The CIA did a report called Global Trends 2015: A Dialogue About the Future With Nongovernment Experts...

A quick summary and links are at href="http://earth-info-net.blogspot.com/2003_03_01_earth-info-net_archive.html#200064840. This report is pre 9/11 and the UN World Summit on Sustainable Development. This should give you an idea of how long this has all been in the works.

Traditional economic theories don't apply. The displacement will be staggering. If this issue isn't picked up by a major candidate and become part of a national debate and an election issue we will all be so busy scrambling for a living nothing else will matter. The one in four that Dean referenced will face increased competition and a rapidly shrinking market.

Traditional economic theories always apply. Name one that you think doesn't.

But the impact to people who can't do more and work smarter than foreign workers will absolutely be staggering, I agree . . . at least until their standards of living rise to the point where their workers start demanding the same benefits that ours do.

Were you even paying attention as postwar Europe, Japan and South Korea locked it on and started competing with us? How is this different, except that it may affect you more directly?

>>But the impact to people who can't do more and work smarter than foreign workers will absolutely be staggering, I agree . . . at least until their standards of living rise to the point where their workers start demanding the same benefits that ours do.

******************************************

Johathan,

You might have a point here. But you refer to took about thirty-five years to happen. Are you willing to wait thirty-five more years to foreign competition for all these services mentioned by Jim?

Jim,

You're way too pessimistic. Jobs leave America, the salary differential decreases, there's less pressure for jobs to migrate. Back to equilibrium. There's really nothing you can do about it anyway, except legislate total isolation from the outside world. Of course, in 200 years we'll then be like Japan in 1850, hopelessly backward.

Back to the article.

It's pretty tough to see how Dean's going to avoid being labelled a tax-and-spender when his avowed plan is to tax and spend.

There is always a loud subset of low tax-paying poseurs ready to accept this, but it's a loser nationwide. If Dean feels he must rescind the tax break, he'd be much better off claiming it's to balance the budget. That's something even I agree with and I hate taxes. Liberals mostly agree, I think, and lefties don't really care what the money's used for as long as the wealthy don't get to keep it.

Dean's done. Comments like these don't go away.

This is a very interesting related article:
http://www.businessweek.com/magazine/content/03_32/b3845084.htm

From the sound of it...he's really more of a 'tax-and-balancer' than a 'tax-and-spender'. Maybe he's running more left hoping to take the primary, then swing back more moderate? But as mj points out, he should really be more careful with his comments if he plans to show his more conservative side later...first impressions count.

Howard Dean really nailed it when he said

Promising a "compassionate" administration, President Bush pledged to "recover the momentum of our economy," "reward the effort and enterprise of working Americans" and confront economic problems now, "instead of passing them on to future generations." Instead, he's offered tax cuts that don't address our needs, and saddled our children with debt for generations to come. On this president's watch, the federal debt has grown by over $1 trillion. That's the rough equivalent of putting $3,500 on the charge card of every American.

How did our nation come to this place? The answer is simple--the economic policies of this administration are aimed at ideological goals, not help for the average American.

‘Tis nobler in the mind to be for taxing and spending, I think, than for tax-cut and spend. At least Gov. Dean specifically (And the Democratic party generally) admits that the money has to come from somewhere. Bush specifically (and Republicans generally) don’t. Remember, under Reagan, we saw (what until then was) the biggest deficits in history...

"I suppose he wants the government to hand out more SBA loans. Those are loans, not capital, usually secured by the business owner's home."

Minor correction. Debt is a form of capital; equity is another. So it would be government-subsidized capital. It's probably not good policy, but it is still capital.

1. The affect of this on me and my family will be indirect.
2. Maybe I should have said that traditional economic theories don't apply in an acceptable time frame. The normalization of salaries will not arrive in time to save baby boomers and their children from a depressed economy and high unemployment.
3. What jobs can be created that can't be outsourced at lower rates in the future?
4. Do a little research on what Indian business and government is doing in education (institutional and at work) to prepare for the future (try a search @ The Hindu Business Line: InfoTech). There is no comparable training initiative here and even if there was we still couldn't compete with wages.
5. The postwar displacement and recovery utilized the lower economic strata of the middle-class as a shock absorber. The wage/skill level of this displacement can only replace itself within the same strata and will create nothing that can't be done cheaper offshore.
6. The discussion has started and while Dean may have dealt himself out of it someone else will pick it up. If not, those of us who continue to pay taxes are going to assume an incredible burden for the massive number of unemployed and their familes over a very long period of time. Here's a start: A few simple ideas to stop outsourcing, loss of jobs or AFL-CIO blasts employer abuses of tech visa programs or
"If the work that remains when the money washes away mostly involves swabbing toilets at Dunkin' Donuts, even full employment will be no blessing. Yet the mantra never changes: more jobs, more jobs. But what jobs, and paid for out of whose accounts? Bailing water from a sinking ship is a job that could keep us all busy for years to come, but will it help buy that Camaro I still want?: from NY Times.com: Magazine: Help Wanted

To date Dean and all the cadidates are just dancing around the issue because they really don't understand it or where it comes from.

Jim,

The bottom line is that if there are significant cost savings to be made, businesses are going to find a way to achieve them or they'll be bankrupt.

Do you think some German engineering firm is going to be shamed out of subbing jobs to India? Economic history shows us that not only is what you suggest (insulating the US from foreign competition) impossible, the attempt is counter-productive.

This is one of thse situations where you have to let your head rule your heart. The economy changes like this constantly, and yet every fifteen years or so we drive ourselves into a frenzy worrying about it. Some people are going to have to change jobs. Engineers vs McDonalds is nothing but a scare tactic.

"Full-employment"?

*blink*

Oh, DEAR.

Jim--I wouldn't assume that because chiefexecutive.net has nothing on offshore sourcing that CEOs don't think it's an issue. There have been articles and debates on this at both Forbes and Business Week.

David - There is a lot on chiefexecutive.net about offshore outsourcing. What I was pointing out is that they consider a common tool now and not an issue. They see any pontential resistance as null.

MJ - I was here 15 years ago and the 15 before that and the 15 before that - I've been working for over 40 years now. This situation is different than what we been through before. I haven't developed this view alone.

Have A Nice Weekend All - I have a date on an island!

David - There is a lot on chiefexecutive.net about offshore outsourcing. What I was pointing out is that they consider a common tool now and not an issue. They see any pontential resistance as null.

MJ - I was here 15 years ago and the 15 before that and the 15 before that - I've been working for over 40 years now. This situation is different than what we been through before. I haven't developed this view alone.

Have A Nice Weekend All - I have a date on an island!

Jim,

We are always told the current circumstances are "different" for this reason or that one. Remember when Japan was going to dominate us? Don't you remember the mantra? "We look at the next quarter, they look at the next quarter century."

Never happened. And all our jobs aren't going to leave for India either.

In addition, you act like job displacement is the end of the world. This is the best kind of foreign aid we could ever offer. Eventually we're going to be on an equal playing field with the entire globe. This isn't something to fear, it's progress.

Jim,

We are always told the current circumstances are "different" for this reason or that one. Remember when Japan was going to dominate us? Don't you remember the mantra? "We look at the next quarter, they look at the next quarter century."

Never happened. And all our jobs aren't going to leave for India either.

In addition, you act like job displacement is the end of the world. This is the best kind of foreign aid we could ever offer. Eventually we're going to be on an equal playing field with the entire globe. This isn't something to fear, it's progress.

Let's see. I'm checking my copy of the Constitution right here.

Article II, Section 2...Commander in Chief...yadda yadda...make treaties, appoint ambassadors...state of the union...

Hmm. Maybe I'm missing it, but I'm not seeing anything in there about "full employment" or "capital for small businesses" or "preventing offshore outsourcing."

Please clarify for me, is there something wrong with me for working short contracts? If Howard Dean plans any sort of government action to interfere with my preferred form of employment I will be forced to devote a great deal of effort to preventing him from being elected.

Triticale..seems to me that today's "progressives" usually have a basically *institutional* view of the world. The idea of one person, acting alone and bearing responsibility for his actions, is anathema to them. This explains why they use "cowboy" as the ultimate term of contempt--because the archtypal cowboy is a man who acts alone.

I have little question that, sooner or later, people like Dean would indeed instigate actions that interfere with your preferred form of work.

Howard Dean’s arrogance is breathtaking, but not surprising. He is blind to the fact that what average Americans need more than anything else from the federal government is to be left alone so they can live their lives as they choose. And that means they need to keep their own money and spend it as they see fit.

But Dean doesn’t like the way average Americans spend their money, so he wants to take it away from them and give it to the government. Which, as we all know, is much wiser and more thrifty than those profligate average Americans.

I posted more on decoding Deanspeak and analyzing just who are the "struggling" average Americans Dean wants to give money to.

Have you guys checked out the reader responses over at the WSJ? They are priceless (even the one posted by some dimwit in Las Vegas).

I find it interesting that Andrew Cory, who's normally a smart guy, falls into this "didn't deficits go to record levels under Reagan" stuff. As has been pointed out here many times in the past, tax revenues soared during the '80s. The only reason deficits went up is because spending went up--and that happened for a variety of reasons, but the main one being that Reagan gave the Democratic congress huge spending increases on social issues and education in exchange for giving him what he wanted to fight the Cold War.

Like those policies or hate them, the notion that tax cuts cause the deficit back then has been debunked so many times, it's frustrating to see it keep rearing its ugly head. What's weird is, I keep seeing it even from people who've seen the evidence on tax revenues, and keep acting like it didn't happen.

Oh, and Andrew: given the dot-com bubble burst, the huge expenditures on Y2K, the uncovering of corporate corruption that had been going on throughout most of the 1990s, the 9/11 attacks and the subsequent damage done to several industries, the reduction in free trade caused by increased border security and even SARs, I am rather astonished that anyone say that it's the economic policies of this administration that have led to our current economic problems.

In fact, as I think I've said before, I'm utterly amazed that we aren't in far worse shape than we're in.

As for outsourcing and jobs going overseas: I've been listening to these exact fears for the last 30 years at least. They never change, and yet, over the last 30 years the middle class has only expanded, the poor have gotten richer and smaller in number, and standards of living have only trended upward.

Thus it's harder and harder for me to take these same old fears seriously again.

Dean,
I remember reading how the Bush Tax Cut was responsible for 1 quarter of the current budget slump. I won't state that as fact, since I can't seem to dig it up right now. What I can do is point at this, and the relevant bit:

An economic slowdown began in 2001 and was exacerbated by the terrorists' attacks of September 11, 2001. The deterioration in the performance of the economy together with income tax relief provided to help offset the economic slowdown and additional spending in response to the terrorist attacks produced a drop in the surplus to $127.1 billion (1.3% of GDP) and a return to deficits ($157.8 billion, 1.5% of GDP) in 2002

That's slate quoting "the historical tables volume of the 2004 White House budget"

So the Whitehouse admitted in 2002 that the tax cut created at least some of the deficits. I believe that it was about 1/4 of the total deficit, but won't swear to it...

But Dean, face it. Under Bush we are spending more and taxing less. Regardless of what we think of the justification for those expenditures, (and fighting Saddam and Terror are two good ones, I’ll grant), the fact is that it is not fiscally sound...

I'll tell you what: Send me a link to hard numbers regarding how much more we took in under Reagan than we did under Carter, and I’ll take a good look at them...

What’s wrong with short term contracts is that they are often not really short term at all. As someone who has worked on indefinite “short term” contracts in the past, I can report that they really suck. Its just like being an employee of the company you work for with none of the benefits, promotablity, or even resume building that comes from being on their actual staff...

This isn’t to say that they are all, or always, bad. Just that they are widely abused. And when they are, there is very little recourse...

Well no, Andrew, I would actually agree with your numbers. CURRENTLY, the tax cuts have increased deficits. Indeed, the Bush White House itself says that the tax cuts are responsible for about a quarter of the current deficit.

To which you must then grant, 3/4ths is not the tax cut.

Classical Keynseian economics--the economics that Roosevelt and every Democratic President has worked until until Clinton--says that in economic bad times, you run up the deficit by using government stimulus (increased spending and/or tax cuts) to stimulate the economy.

Even Clinton cut the capital gains rate as a fiscal stimulus, by the way.

And so I ask you again: given the massive body blows this economy has taken since 2000 (I listed several) how can you possibly blame the administration's economic policies for our woes?

I myself would say that the administratin's policies have prevented unemployment from getting much worse than it otherwise would have, and I see great justification for that in both the fiscal stimulus provided by the tax cuts and the increased confidence Americans have in their security.

But even if you don't accept that analysis, how can you possibly lay all our woes at the President's feet, when so much of what's happened is completely beyond the control of the political sphere?

Why are we even discussing the economic nonsense of Howard Dean? He brags of his budgets in Vermont - a state whose budget is less than scores of cities in America. Face it, Dean is as qualified for President as any mayor of any city of a half-million population ...

the notion that tax cuts cause the deficit back then has been debunked so many times, it's frustrating to see it keep rearing its ugly head.

The notion that tax cuts caused the revenue increases of the 80's has also been debunked time and time and gain but people cling that that bit of faith based economics too. Deficits happen for only one reason, we spend more then we take in. To blame deficits exclusively on either side of the equation is silly, to say that the cuts did not affect revenues is compleat crap. To talk about the prosperity of the 80's without mentioning the fact that the price of oil collapsed from a high of close to $80 a barrel to less then $20 displays a lack of insight into the working of our economy that is staggering.

I think Howard Dean might have a problem with the self-employed because we're most likely to get away with not paying taxes. :-)

Dear Sir,
I need $300000/-TO START A BUSINESS TO BE TOP IN INDIAN BUSINESS WORLD AND HELP.
BEST REGARDS,
RANVIR SINGH

Here we go with another clueless democrat. The economy is recovering very nicely from the Clinton recession thanks to the tax cuts(reversal of Clinton tax increases). If Dean becomes president where does he think all the money he plans to hand out from his goody bag will come from???? Us of course! Private sector spending and investment is tremendously more effective in driving the economomy than the government. This is a proven fact. Even Bush needs to get back to conservative fiscal policy and cut back on government spending!!

If Dean wants a middle class jobs base he would do well to stop listening to people cluesless about the impact of outsourcing. The use of H-1b and L-1 visa workers in IT coupled with outsourcing is destroying the job market for new computer science grads and driving highly trained IT workers out. There are no new employment sectors opening up with comparable pay and benefits. The US is losing its technical lead and job base. The root of the problem is in the assumptions underlying "free trade" and the pro-corporate policies adopted by Democrats and Republicans. High wage workers in the U.S. economy are not a problem; they help make our economy prosper since they are consumers in addition to being employees.

www.outsourcecongress.org
www.tradealert.org
www.techsunite.org
www.washtech.org
www.allianceibm.org