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You may have heard of these U.S. companies that outsource jobs:
Food: Coca-Cola, PepsiCo, Nabisco, General Mills, Hershey, Kraft Foods
Clothing: Nike, Levi Strauss, Lands’ End, Nordstrom
Computer: AOL, Yahoo!, Google, Amazon.com, Microsoft, Apple, Dell Computer, IBM, Intel
Cell Phone: AT&T Wireless, Verizon, Motorola, Sprint |
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Kerry and Bush Face Off
by Mark H. Levine
click for a printer friendly version (PDF)
The man with whom you’re speaking on the telephone sits in an office in New Delhi, India . He politely explains, for the third time, why your new computer crashes every time you save your history assignment. Unaccustomed to his thick Indian accent, you tightly press the receiver to your ear, but his explanation remains indistinct. Frustrated, you thank him, hang up, and ask yourself, “Why can’t my computer company hire Americans, whom I can understand?”
American companies hiring cheap labor overseas—a process called outsourcing—remains a controversial issue in the presidential campaign. Not surprisingly, President George W. Bush and Senator John F. Kerry differ on the merit of outsourcing.
BUSH’S VIEW
President Bush explains that outsourcing is a welcome result of free trade and calls it “a good thing.” He might answer your question by saying: “It’s frustrating when you can’t understand the technician in India , but this is a short-term problem that shouldn’t overshadow the long-term benefits of outsourcing. When a business hires cheap, skilled, foreign labor, production costs plummet—some say as much as 70 percent. Lower costs mean less expensive products; you pocket the savings. That’s why your new computer was so inexpensive.
“But some say outsourcing causes unemployment. If so, we’ll react as the government did during the 1970s and 1980s when manufacturing jobs were outsourced: America retrained unemployed factory workers for higher skilled jobs. We’ll do the same for computer programmers, help-desk operators, and others who lose their jobs due to our free trade policies.”
KERRY’S VIEW
Senator Kerry criticizes the president’s support for outsourcing, saying, “I think we need a new president who’s going to create jobs in America ….” He might answer your question by saying: “The president values corporate profits more than he values American workers. To slow the pace of outsourcing, I suggest we adopt policies that will level the playing field for American workers. Unlike their U.S. counterparts, foreign companies don’t pay workers a minimum wage or follow safety and environmental rules. As a result, their labor costs are lower, and low wages invite outsourcing. When I’m president, I’ll negotiate trade agreements that require foreign companies to implement labor, safety, and environmental standards, which will make American labor more competitive.”
A JEWISH VALUES PERSPECTIVE
Competition fuels the marketplace, and when businesses compete, consumers usually win. But because outsourcing might harm American workers, should the government restrict companies from exporting jobs? Jewish values can clarify this political controversy.
Jewish tradition respects local competition because it usually safeguards the public good: “It is permitted for a person to set up shop alongside shop, bathhouse alongside bathhouse, and the existing firms cannot prevent it” (Baba Batra 21b). Moreover, our Sages also allowed foreign merchants to compete in local markets, as long as they paid taxes.
However, when feudal monarchs restricted how Jews could earn their living, work became scarce. Fewer jobs meant increased competition, which oftentimes became destructive. To decide disputes, the rabbis extended the legal principle of hasagat g’vul—the Biblical prohibition against encroaching on another’s land (Devarim 19:14)—to include encroaching on another’s livelihood. In a similar way, victims of outsourcing might claim that their livelihood is being encroached upon.
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