Bush's Jobs Stance Draws Fire

Democrats from Washington to the U.S. presidential campaign trail lit into U.S. President George W. Bush's chief economist this week for his laudatory statements on the movement of U.S. jobs abroad, seizing on the comments to paint Mr. Bush as out of touch with struggling workers.

"They've delivered a double blow to America's workers, three million jobs destroyed on their watch, and now they want to export more of our jobs overseas," said John Kerry, the Massachusetts senator and front-runner for the Democratic presidential nomination. "What in the world are they thinking?"

U.S. Rep. Donald Manzullo, an Illinois Republican, called for the resignation of Gregory Mankiw, the chairman of the White House Council of Economic Advisers and a prominent Harvard University economist. Mr. Manzullo said industrial-state Republicans are furious.

"I know the president cannot believe what this man has said," Mr. Manzullo said. "He ought to walk away, and return to his ivy-covered office at Harvard."

As Mr. Mankiw released the annual Economic Report of the President, he said Monday that the "offshoring" of U.S. service jobs is only "the latest manifestation of the gains from trade that economists have talked about" for centuries.

"Outsourcing is just a new way of doing international trade," Mr. Mankiw told reporters. "More things are tradable than were tradable in the past and that's a good thing."

The report itself, under Mr. Bush's signature, offered similarly encouraging words, asserting that "when a good or service is produced more cheaply abroad, it makes more sense to import it than make or provide it domestically." It also said growing competition with China hasn't been an important factor in U.S. manufacturing job losses.

The White House tried to take the political sting out of the issue Tuesday, emphasizing the funding Mr. Bush has sought for job retraining, community colleges and "personal re-employment accounts," which laid-off workers could use any way they see fit to find a new job.

"The president's view is that American workers are the best workers in the world, and he is committed to free and fair trade. He is committed to a level playing field," said White House spokeswoman Claire Buchan, "and believes we have to prepare workers for the economy of the future."

Mr. Bush's 2005 budget request does increase spending on his new proposals, as well as job training under the Trade Adjustment Assistance Act. But other programs face cuts or elimination, such as one-stop career centers, youth-opportunity grants and migrant-worker training.

The statements on "offshoring" only fueled attacks on Mr. Bush's job-creation record from Democrats who have made economic nationalism a centerpiece of the campaign season. One Senate Democratic aide promised the words would become staples for every Democratic campaign this fall. Senate Minority Leader Tom Daschle, a South Dakota Democrat, opened a meeting with reporters by offering his critique of Mr. Mankiw's economics.

"This is actually now the position of the White House that they support outsourcing of jobs, jobs going abroad, saying that that's good for our country," he said. "Well, you tell that to the nine million Americans who are out of work."

Mr. Mankiw faced the criticism in person when he appeared before the congressional Joint Economic Committee to present the economic report. U.S. Rep. Fortney "Pete" Stark of California, the panel's ranking Democrat, told him: "Bush stands idly by as jobs continue to take flight from the U.S., and now we know why. It's part of his economic plan."

Mr. Mankiw and the president's report contend the U.S. economy ultimately will benefit when the production of goods and services finds its way to the nation that can render them most efficiently.

Mr. Mankiw acknowledged the pain trade-related dislocations can have for individuals. "We need to help workers find jobs and make sure to create jobs here," he said. "But we shouldn't sort of retreat from the basic principles of free trade."

Updated February 12, 2004