Phil AmmannThe issue of outsourcing has now been jammed into the presidential race. Donald Trump has declared a mission to “bring back” the 5.5 million U.S. jobs from all the far-flung corners of the world to which they’ve historically been sent.
The fanning of protectionist flames has long been used as a vote-getting tool, a way to reach voters emotionally in the midst of other contentious problems. The 2016 cycle is proving to be no exception, with its concerns dividing the electorate, namely ISIS, immigration, and a Supreme Court vacancy. But regardless of the political points that may be scored from railing against outsourcing, the predictable fact distortions being presented serve no one.
Campaign trail soundbites consistently fail to account for how politicians, more than anyone else, have been responsible for pushing jobs into the arms of more business-friendly territories over the years. Offshoring entities often get vilified, but the continuous regulatory and tax assaults emanating from the federal government are primarily what have created incentives for U.S. companies to hire foreigners over Americans, or move whole manufacturing sites overseas.
Looking past the political rhetoric, one would find that these firms are simply trying to survive in a global marketplace, yet finding the domestic business environment to be uninviting. It’s hypocritical to put hurdles in front of businesses and then lambast them for setting up shop elsewhere.
The only way to truly bring a nationalistic jobs vision to fruition — assuming that is one’s goal — is to make America more palatable commercially. The tax and regulatory burdens suffocating businesses must be relaxed.
Jobs belong to the companies that create them and presidents cannot, by sheer decree, move jobs back home. What they can do, however, is harness their fiscal and monetary powers to make companies feel more comfortable hiring domestically and prevent the need to lean on a global workforce.
Trump, to his credit, in his rather thin plan to bring jobs back, proposes a 15 percent corporate tax cut. This helps, but doesn’t go nearly far enough to generate the broad and long-term changes he claims to want. The U.S. has been outsourcing jobs overseas since the 1960s and only radical change can upend cross-border hiring practices.
Other pieces of Trump’s plan further expose the difficulties in restricting outsourcing. He has called for more intellectual property enforcement and curbs on illegal export subsidies, but both of these ideas are feeble tweaks that would do nothing to halt the global economic train that the world has grown accustomed to.
And who says these millions of jobs need to be brought back anyway? What is also lost in election chatter is how the country insources just as many jobs as it sends out. Global job flow is not a one-way street, as millions of Americans work within our borders for multi-national firms.
Politicians conveniently omit this fact when they pander to voters, but it’s a sobering reality. Would a Trump-esque rejection of outsourcing mean the U.S. couldn’t participate on the receiving end of it either?
Indeed, it is a faulty assumption that closing the door on outsourcing is the “right” or patriotic thing to do. Beyond employers and many employees, the poor and middle classes might also disagree with this logic, given the expanded access to cheaper goods outsourcing has enabled.
Though offshoring is a radioactive political term, it is difficult to see who would really benefit from its dissolution. The blustery calls being heard now for bringing back jobs are no different than they were years ago: heavy on emotion and political desperation, and light on particulars.
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Sarah Maricle Ayers has a bachelor’s degree in economics from Florida State University, and an MBA from FSU. Her op-eds on economic issues have been published in Florida newspapers. Column courtesy of Context Florida.
