World News Tonight Criticizes Outsourcing
ABCs Closer Look takes
one step forward, two steps back on trade debate.
By
Charles Simpson [1]
August 26, 2005
Even though ABCs World News Tonight drove a long way off the
beaten path for a Closer Look at outsourcing, its coverage still
came up a few miles short. In an August 25 report, Barbara Pinto
took a trip to rural Minnesota, Hardly the place computer
programmer Dave La Reau expected to find work.
Before finding work for a computer company in the sleepy town of
Sebeka, La Reau lost his job in Chicago when it was outsourced to a
foreign country. Anchor Terry Morans introduction to Pintos report
warned that some 3.3 million service jobs are expected be shifted
overseas between now and 2015 to countries where wages are
relatively low.
Like most reports on the topic, ABC failed to mention that the
number of jobs outsourced from the United States is miniscule (0.1
percent, according to the Kansas City Federal Reserve Branch) when
compared to the total U.S. job market. Its also small compared to
the number of jobs insourced to the United States from foreign
countries. Those insourced jobs pay 31% more than all domestic
companies.
But, at least ABC acknowledged that theres some rationality behind
the process. Toward the end of her report, Pinto stated that
Analysts predict there will be more companies moving their
high-tech operations to rural areas as they reconsider the costs and
the risks of doing business overseas.
The most basic reason companies outsource is because free trade is a
solution to the costs and risks of doing business incurred by the
price of unionized labor and corporate taxes at home. When a product
can be made cheaper, and with better quality, in a foreign nation,
those savings are reinvested into the U.S. economy and create better
paying jobs. That means a small town in Arkansas has just as much of
a chance at providing a competitive labor environment as a hamlet
outside Bombay.
While Pinto did note that this type of outsourcing might be good
for rural America, she didnt really explain why it has, for years,
been good for all Americans.
ABCs handling of the topic was nowhere near as biased or dramatic
as CNNs Lou Dobbs Tonight. A Business & Media Institute Special Report,
Trade
Secrets [2], found even insourcing was bad news to business
journalist and CNN host Lou Dobbs.