Outsourcing is at its most basic level a highly controversial campaign issue. Many companies, eager to save money and increase profits, have moved jobs overseas to countries where labor is less expensive. While some economists and politicians argue that companies must outsource jobs to stay competitive internationally, others worry that outsourcing can only hurt the American worker.
On Friday morning, alumni, faculty and students filled Ives 305 for a debate on outsourcing between Thomas J. Donohue, president and CEO of the U.S. Chamber of Commerce, and Richard L. Trumka, secretary-treasurer of the AFL-CIO. The event, which was part of Cornell’s Mock Election 2004, was moderated by Prof. Jefferson R. Cowie, collective bargaining, labor law and labor history. The Sun is a co-sponsor of Mock Election 2004.
In his brief opening remarks, President Jeffrey S. Lehman ’77 extended his congratulations to the School of Industrial and Labor Relations and the student group responsible for organizing the debate and lecture series that is leading up to a four-day online mock election that begins today.
After he echoed Lehman’s praise, Cowie summarized the event’s format and the debaters’ biographies.
Cowie asked Donohue and Trumka to characterize outsourcing in terms of its size and scope.
Donohue emphasized that, although the United States outsources between 250,000 to 300,000 jobs each year, the country insources $60 billion more than it outsources. In response, Trumka pointed to stagnant job-growth and wage indices, and urged audience members to think rationally.
“Sending our best jobs overseas doesn’t make sense,” Trumka said. He characterized outsourcing as “a job problem, a trade problem and a policy problem.”
The two debaters were asked to consider outsourcing from an historical perspective, and to predict its role in the country’s economic future. Again, Trumka reacted pessimistically.
“It’s a continuing problem,” Trumka said. “And it’s only going to get worse.” Donohue rejected Trumka’s negative assessment. He confidently cited indicators that the American economy is rebounding, including an increase in home ownership and “all-time-high employment in the United States.” Donohue forecasted a continuing need to move certain jobs overseas to stay competitive in the global marketplace.
Cowie opened the floor to questions from audience members. Students and faculty asked an array of questions on issues ranging from domestic unemployment to outsourcing’s effects on workers’ rights.
Donohue and Trumka both agreed that sweatshop practices are abominable. “American companies are working hard on marketplace issues and working conditions,” Donohue said. “I think that American companies have a moral obligation to be clean, fair and safe.”
A student asked Donohue to compare executives’ salaries to most workers’ annual incomes, and to note the incredible disparity between the two. Donohue, paraphrasing futurist Herman Kahn, asserted that “conventional wisdom is almost always wrong,” and urged the questioner to look at the difference between executives’ earnings and the amount of money that many athletes and entertainers make.
“[The difference] makes CEOs look like scrappers,” Donohue said. Nearly an hour into the event, an untimely fire alarm went off in Ives. Resigned, Cowie thanked the two speakers for their participation, and the audience members for their questions.
Despite the event’s premature ending, Cowie considered the debate to be a success.
“We were honored to have what were probably two of the most passionate, informed, and eloquent speakers available in the nation on the subject of outsourcing,” Cowie said.
Since Donohue took over its leadership in 1997, the U.S. Chamber of Commerce has seen marked increases in its membership and profits. He has increased the organization’s lobbying presence in Washington and its involvement in international trade issues. Previously, Donohue was CEO of the American Trucking Associations.
Trumka, a third-generation coal miner, was formerly president of the United Mine Workers of America, and served on President Clinton’s Bipartisan Commission on Entitlement and Tax Reform. He was elected to his current position in 1995, and has dedicated himself to reenergizing the labor movement.
Outsourcing gained national attention in February, when Prof. N. Gregory Mankiw, chair of the President’s Council of Economic Advisers and the Allie S. Freed Professor of Economics at Harvard University, characterized it as “a positive for economies around the world, both at home and abroad.”
“Outsourcing is just a new way of doing international trade,” Mankiw said. “More things are tradable than were tradable in the past. And that’s a good thing.”
During relatively dismal economic times, Mankiw’s comments stirred up immediate controversy. Candidates for the Democratic presidential nomination wove his remarks into their stump speeches. The Bush administration was forced to clarify its economic objectives. And pundits clashed over Mankiw’s optimistic appraisal of outsourcing.
Archived article by David Gura
Sun Staff Writer