Saturday, March 26, 2005

Guest worker programs aid the conversion from domestic to import

“Outsourcing converts domestic supplied goods and services into imports. It divorces Americans from the incomes and careers associated with the production of the goods and services that Americans consume. By turning domestic production into imports, outsourcing increases the trade deficit.” – Paul Craig Roberts, senior fellow at the Hoover Institution and former Treasury official in the Reagan Administration

Guest worker programs aid the conversion from domestic to import In service outsourcing, the guest workers, in combination with domestic workers, form a transmission belt that extracts the technical knowledge to do the job from the domestic worker. The guest worker then returns home so that we can purchase this worker’s production as an import. Pretty nifty, eh?

Currently, offshoring companies are the middle men between domestic production and domestic consumption. They divert the production, convert it to an import and we buy it back. This is not an economically feasible business model. However, it works due to government intervention, in a similar fashion that slavery worked due to government intervention. Once government support for slavery ended, the plantation system collapsed to a trickle.

The key point I want to get across is that without massive government intervention via the guest worker programs, offshoring would collapse to a trickle. Offshoring companies would spend time restructuring their businesses so that their aren’t dependent upon government programs. (And ultimately dependent upon us, since we have a role to play in government programs.)


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