Nation's Worst Outsourcer? You

If Obama and Romney really want to create jobs, then they should propose a ban on interstate trucking


Adulthood, they say, is just like high school, but with money. Something similar could be said of the presidential race. Lately, the candidates have sounded like a couple of middle-schoolers:

Obama: "You're an outsourcer!"

Romney: "I know you are, but what am I?"

You know the attack on Romney as a corporate chainsaw who shipped jobs overseas is doing damage, because last week his team dispatched a couple of  sharp young staffers to rebut the charge point by point. Then Romney counterpunched: "This president has been outsourcing a good deal of American jobs himself," Romney said. "If there is an Outsourcer-in-Chief, it's the president of the United States." Oh, snap.

Meanwhile, economists are cradling their heads in their hands and ordering a round of boilermakers. Why? Because outsourcing is not the evil job-destroyer the candidates pretend it is. In fact, it produces a small but measurable increase in domestic employment. A recent study by the London School of Economics says so: As one news summation put it, "increasing offshore jobs by 1 percent is linked to a 1.72 percent increase in overall U.S. employment of native workers."

How can outsourcing bolster domestic employment? Here's one example cited by Team Romney: Setting up an overseas help desk to take customer calls about, say, the Japanese version of Microsoft Office increases software sales overseas, which creates jobs back at the home office. It also increases U.S. trade exports, which – the Romney folks tartly note – President Obama says he wants to do.

Still. Political operators are not about to let the facts ruin a perfectly good attack. So expect to hear a lot more about who has been outsourcing what during the next three months.

Yet if outsourcing really is so terrible, then the two presidential contenders should not limit their critique to each other. After all, some of the worst offenders are their own close political chums.

Take Virginia Gov. Bob McDonnell. Earlier this month he traveled to Great Britain to drum up business. In a press release from London, McDonnell said: "Over the past few years, we've met in Germany with The Hornschuch Group, and they are bringing 174 new jobs to Winchester. . . . [O]ur previous trips to the Farnsborough and Paris Airshows have brought six new companies to [the Commonwealth Center for Advanced Manufacturing] in Prince George County. In fact, our 2010 Farnsborough meeting with DRS Technologies resulted in the company moving its corporate headquarters to Virginia."

Get a load of that: Foreign companies are offshoring jobs to Virginia! What an outrage! Wait – it's not an outrage? It's a good thing? Then why is it such a heinous crime when U.S. companies move jobs abroad?

Governors in the U.S. don't poach business only from overseas. They constantly entice companies to move from one state to another, too. Two years ago, Northrop Grumman moved—i.e., outsourced—its corporate headquarters from Los Angeles to Northern Virginia (and was handsomely rewarded with state money for doing so). The year before, Hilton Hotels moved from Beverly Hills to Northern Virginia. Virginia's governor at the time, Tim Kaine – he whom Barack Obama later begged to head up the Democratic National Committee – boasted:  "Adding this hospitality industry leader to the Commonwealth's list of corporate headquarters is a major coup for Virginia. I commend everyone involved in bringing Hilton to the Commonwealth."

Translation: Three cheers for outsourcing!

Lots of other companies – from General Dynamics (which left St. Louis) to DynCorp (which left Irving, Texas) have moved to the Old Dominion as well. By the same token, many companies have left the Old Dominion for greener pastures elsewhere. Last month, for instance, ExxonMobil announced it was transferring 2,100 employees from Fairfax to Houston, Texas. Why hasn't Bob McDonnell blasted Exxon and his fellow Republican, Rick Perry, for this vile betrayal?

You could run a similar exercise for every state in the nation. Companies move their operations all the time. It's called a free market. Yet to hear Obama and Romney talk, we need to put a stop to it right now.

Know who else is a horrible outsourcer? You. Chances are you have moved at least once in your life. If so, you took work away from your local grocer, hairdresser, and plumber and outsourced it to somebody else. What kind of evil, greedy monster are you?

Well. If we can save some jobs by stopping outsourcing at the U.S. border, then just imagine how many more jobs we could save by forbidding companies to move jobs between states. And if Obama and Romney really want to create jobs, then they should propose a ban on interstate trucking – and maybe in-state trucking, too. Wall off the cities and make the inhabitants fend for themselves. That will keep 'em busy.

In rhetoric, they call this line of argument the reduction ad absurdam. ("Oh, you want to save lives by lowering the speed limit to 55 mph? Why not lower it to 10? Or five? Why not make everybody walk?") In this case, though, what's really absurd is the notion that the less we trade, the better off we'll be.

Even a high-schooler can see through that.

A. Barton Hinkle is a columnist at the Richmond Times-Dispatch, where this article originally appeared. 

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  1. forbidding companies to move jobs between states

    I believe the government already tried this with Boeing

    1. funny how contracts signed by mgmt work like that

    2. Just wait. Directive 10-289 is on its way …..

    3. No, worse. They weren’t moving jobs, IIRC, they were building a new plant and leaving the old one up. But their decision to build the new plant in a right-to-work state got them in trouble.

  2. Unless you ride your locally bred horse down to the village square to purchase goods from the Miller, Cooper, and farmer’s market – you are an Outsourcer!

    1. There are people who believe this

          1. It gives me a map with my local farmstands – that I already frequent. I guess I better stock up, they all close around Thanksgiving and don’t re-open until Memorial Day (except the one that open earlier and sells Florida produce for a couple months).

        1. Locavores.

          1. Locavorism works in Vermont, not so well in New Mexico. If I could only eat was was grown within fifty miles of me, I’m fine living in San Jose, but it would put a considerable cramp on my diet if I lived in Juneau.

            An why limit buy local to food? Why not having to buy clothes that were made local? From locally grown fibers? Dyed with locally produced dyes? Ditto for the shoes on your feet, the bed you sleep in, the drugs you take, the car you drive, etc.

            Oh wait, we used to have that. It was called the Dark Ages.

  3. You do have to love the fact that the people who like to claim that the entire world would still be living in poverty if government bureaucrats hadn’t invented things like the road, the bridge, and the airplane are the same people who go nuts if a company relocates from one place to another.

    1. I don’t love it. One bit.

      I’m afraid these luddites have destroyed my sense of irony, and my sense of humor.

      1. Would you like to outsource your senses of irony and humor to me?

    2. The Wright brothers were government bureaucrats? Who knew?

      Funny story about the invention of the airplane. In 1897 the Dept. of the Army gave Robert Langley (then considered to be the foremost scientific mind in the country) $50,000 and 3 years to come up with a heavier than air controlled flying machine. 5 years, an additional $25,000 dollars and 2 failed attempts later (the 2nd of which killed the test pilot) Langley gave up and said it couldn’t be done.

      And we all know what about year later in 1903: a couple of bicycle mechanics from OH without a HS diploma between them succeeded.

      Really bolsters one’s faith in TOP MEN doesn’t it?

      1. 1. Samuel Pierpont Langley, not Robert.

        2. The test pilot didnt die.

        3. $50k from the Army, $20k from Smithsonian.

        4. He never declared that it couldnt be done, in fact, his model was modified and flown a few years later in a failed attempt to dispute the Wright Bros patent.

        It did lead to a feud between the Smithsonian and Orville Wright because the Smithsonian claimed Langley’s was the first plane to achieve sustained flight.

        [Most info from wikipedia, so YMMV]

      2. To top that off, this failure has an Air Force based named after him (surprisingly in VA)…go figure. And, I can say this because I served in the Air Force!

        Our government at its finest.

    3. People like this actually exist. It’s a credit to my bubble that I rarely encounter them, but when I do I usually have to go home, collapse into a corner, and have a long cry.

      I once ran across campaign worker for Carly Fiorina (a Republican, in case you forgot) who genuinely believed that government caused everything to happen. He explicitly claimed that it was government planning and direction that caused trucks to deliver rural produce to grocery stores in Los Angeles.

      p.s. Which largely explains why Carly lost the race, because she couldn’t get anyone excited about her campaign and so resorted to hiring kids from the UC Berkeley Marxist Club.

  4. Meanwhile, economists are cradling their heads in their hands and ordering a round of boilermakers. Why? Because outsourcing is not the evil job-destroyer the candidates pretend it is. In fact, it produces a small but measurable increase in domestic employment. A recent study by the London School of Economics says so: As one news summation put it, “increasing offshore jobs by 1 percent is linked to a 1.72 percent increase in overall U.S. employment of native workers.”

  5. Get a load of that: Foreign companies are offshoring jobs to Virginia! What an outrage! Wait ? it’s not an outrage? It’s a good thing? Then why is it such a heinous crime when U.S. companies move jobs abroad?

    Have you not been paying attention? America Uber Alles! We’re number 1! USA! USA! USA!

    1. I’m sure Virginia’s proximity to DC and willingness to cut tax breaks for incoming companies has nothing to do with their success.

      1. Yeah, especially for the huge government contractors the article mentions.

  6. In 1716, an important and insightful document was written on this subject.

    1. Correction: 1776, not 1716.

    2. “The Declaration of Independents” was written in 1716??!

      1. Doesn’t that mean it should be public domain by now? Why did I pay 14 bucks for it?

        1. Why did I pay 14 bucks for it?

          Because going to Amazon.com and buying it for $8.48 plus shipping, or checking it out from the library for $0.00, is hard to do?

          Save yourself some money, and just pretend you checked it out from the library, read a chapter or two, and then returned it because it was a crap book.

  7. The ignorance in this area is boggling. I try to explain to my liberal, anti-“outsourcing”(wrong term by the way), boycott Wal-Mart neighbors how MY well-paying job will be gone in a flash if some of this protectionist nonsense gets codified. If my company were somehow forced to keep low-paying call center and manufacturing jobs in country, we simply wouldn’t win the business we do today and I and many of my fellow professional level employees would get laid off.

    Also, fried chicken.

    1. perhaps update ur business model since many cos are insourcing those same functions due to cheaper energy

      1. In Urine’s syphilitic imagination, anyway.

      2. Actually there really is a large movement towards “insourcing” (not really a term but hey someone else used it first) because they are discovering that many of the so called benefits of outsourcing have been oversold.

        Yes the bill rates for the workers are lower, but even when you get equivalent quality people there are sufficient difficulties added into your process that most or all of that benefit evaporates.

        This by the way is not about being anti outsourcing, when it really makes equivalent quality products cheaper it absolutely should be done, the problem is in many cases what savings there are to be made are made at the cost of quality and/or sustainability (and not in the ecological sense but in the business process sense)

        1. You mean companies change sources of labor based on utility and price? They don’t just send all the American jobs overseas because they are made of pure evil and love to see Americans suffer? IMPOSSIBRU!

  8. This was a bad, uninteresting, ridiculously overreaching article. Reason needs to an article on overpaid pundits.

    1. My doppelganger!

  9. Even a high-schooler can see through that.

    You’d like to think that, but no.

  10. barton falsely defines outsourcing since moving domestically keeps the [JERBS] here…in ‘merica babieee

    1. o3,
      Either you get taller so the point doesn’t go right over your head, or admit you’re an ignoramus.

    2. outsourcing NOT EQUAL offshoring.

      1. This.

        Outsourcing means hiring contractors or another company to take over non core portions of your business.

        Offshoring means moving all or a portion of your operations overseas.

        You can do one, the other, or both at the same time but they are not the same thing and no matter how you cut it relocating your facility to a new location does not qualify for any of them.

        1. Hey now, don’t try to confuse the issue by using the actual definition of a word. Besides, it doesn’t matter what you call it anyway. It’s wrong. And evil. And CORPORASHUNZ!

  11. If Americans were willing to pay more money for their stuff and actively reject inexpensive goods, that could stop outsourcing.

    But we demand lower prices but liveable wages for workers. That means stuff made in America can’t compete.

    But that’s not going to change anytime soon, nor should it.

  12. Buying anything from any store or individual is outsourcing. When I buy a pair of shoes I am outsourcing my purchase to that company. I could have made shoes myself, but I chose to outsource. If you are against outsourcing I don’t see why you wouldn’t be against this.

    1. Each politician is only against outsourcing from their constituency. Presidents want more jobs in America. Governors want more jobs in their state. Mayors want more jobs in their city. Etc. It’s more evidence that politicians really are just tribal leaders trying to raid the next tribe over because they believe we live in a zero-sum world.

  13. Funny article. But it’s actually “reductio ad absurdum”.

  14. There’s nothing “free market” about one state enticing a business across state lines with public funds.
    I get that Reason needs to pump out the content, but sharpen up.

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  16. lation: Three cheers for outsourcing! http://www.maillotfr.com/maill…..c-3_5.html

    Lots of other companies ? from General Dynamics (which left St. Louis) to DynCorp (which left Irving, Texas) have

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