Strengthening Constitutional Self-Government

No Left Turns

Outsourcing Bad Economics

Good to see not one but two Wall St. Journal articles on the recent flap over outsourcing occasioned by White House economist Gregory Mankiw’s statement that outsourcing jobs overseas was simply a form of trade that actually benefits the U.S. economy. How? By making domestic production more efficient in the short haul and raising the standard of living in the not so long haul. Both Alan Murray’s article,
"Bush Economist Performs Bellyflop Into Outsourcing" (2/17/04),
and HP President Carly Fiorina’s op-ed, "Be Creative, Not Protectionist" (2/13/04) put "productivity" into the current debate over how best to create jobs in America.

I especially liked Fiorina’s provocative statement last month that "There is no job that is America’s God-given right anymore." Crudely put, but a good reminder of the difference between conservative and liberal views on what citizens should expect from their government: liberals think government should "create" jobs out of thin air, whereas conservatives think that if government should "create" anything, it’s an environment that guarantees the right to property and provides a tax structure that provides incentives for the most productive use of capital.

In his state of the union address, President Bush made the conservative case for a government that does not create jobs per se, but protects private citizens (through low and fair taxes, for example) in their capacity to create jobs. But with his recent comments about America losing jobs to overseas companies, he seems to be borrowing from the Democrats’ playbook. Understandably, he does not want to reprise his father’s alleged indifference to the economic plight of unemployed Americans, which in part produced the election of Bill Clinton. Nevertheless, Bush needs to use his campaign to teach many Americans some basic economics about America’s strong position in the real global economy.

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