John Podhoretz echoes Peter Schramm’s observations about the political effects of yesterday’s news that the economy grew at 7.2% the last quarter. The Democrats will be increasingly desperate and likely say even crazier things about Bush’s foreign policy. (Although it probably also means that Hilary Clinton can’t be talked into running for President in ’04.)

A former student of mine sent the following e-mail expressing a note of caution about all of this euphoria about the economic numbers. He is in his early thirties and has had a very good job in the Information Technology Sector for several years. Recently, he quit his job because he knew that his job like many others at his company was going to be outsourced to India or the Phillipines. He’s decided to be a stay at home Dad while his wife continues to work. He thinks that this economic rebound doesn’t have much in it for the middle class. He thinks there are a lot of disgruntled people out there even with these rosy economic numbers. I don’t know whether he is right about the extent of the problem.

There are two interesting links on outsourcing, immigrants legal and illegal at the end of his e-mail.

Here’s his e-mail:

"Yes, I see problems ahead -- not just for Bush but for the U.S. The GDP numbers look good but when the haze from mortgage refinancing and impulsive auto purchases clears we will see some troubling statistics. There are no new middle class jobs emerging as part of this economic recovery -- corporations are generating earnings but middle class jobs are scarce. Large numbers of middle class jobs have been eliminated in the U.S.; they have been moved offshore or they are filled by foreign workers here on visa and all indications point to a continuation of this trend. The replacement of American workers began in industry and has now moved into the "white collar" professions -- most notably the IT sector but it is also beginning to affect professions such as accounting. There isn’t a new wave of middle class jobs on the horizon which will replace that which has been lost and is being lost on a daily basis by "offshoring" and the widespread use of H-1B and L-1 visa workers here in the U.S. (This is the information age and nothing more concretely epitomizes the loss of our leadership and social prosperity in this age than the elimination of the American software engineer.)

In addition to questioning the relevance of the GDP figures, it is well to mention that there is widely-discussed problem of under-employment which is not tracked in government statistics but is talked about and read about in a variety of mediums, including the internet. (I’ll share an example with which I am quite familiar. One of my former colleagues from ... has been unable to find an IT position for over 1 year; he’s now working in a lumberyard!) These stories accumulate and have the unpleasant capacity to affect consumer confidence and consumer spending and voting.

If the middle class jobs issue is of concern to many of us now, imagine what it will be like in the next few months. Worker replacement programs will actually gain momentum and more professional people will lose their jobs. Any numbers indicating economic growth are of little consequence to people in professions put out of work or threatened by foreign worker replacement. It isn’t difficult to see why consumer confidence may be quite indifferent to reports indicating economic growth. Educated people ("opinion leaders") follow news reports and share information (such as the items you see at www.outsorcecongress.org). Those of us in the middle and upper-middle classes are talking a great deal about corporate worker replacement programs because many of us know friends, neighbors, colleagues and family members who are affected. As a rule, "opinion leaders" aren’t complacent people who just accept events as unachangeable nor do they accept shallow excuses from elected officials.

Link One

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