Nunn attacks Perdue for dealing with economic reality

PERRY — There was a time when supposedly centrist Democrats didn’t resort to economic know-nothingism. Maybe some of them still do, somewhere outside Georgia.

The word of the week for Michelle Nunn’s Senate campaign is “outsourcing.” This follows the discovery of a transcript of a 2005 deposition of her GOP opponent, David Perdue, in an ultimately unsuccessful lawsuit against a company he once ran.

When asked by a lawyer about his experience with outsourcing, Perdue replied, “I spent most of my career doing that.”

Besides cloying and non-specific paeans to bipartisanship, outrage at this nine-year-old statement is about as close as Nunn’s campaign gets to what George H.W. Bush called “the vision thing.”

The Democrat seized obsessively on this line in Tuesday night’s debate at the Georgia National Fairgrounds. Audience members could have been forgiven for thinking Perdue was responsible for the entire 35-year decline in U.S. manufacturing.

Since peaking in 1979, the number of jobs for Americans who make things has fallen by almost 6 million. The failure of Pillowtex, the company about which Perdue was being questioned in 2005, accounted for a fraction of 1 percent of those losses.

The jobs lost at Pillowtex are also outnumbered roughly three-to-one by the jobs Perdue says he created later in his career, at Dollar General. To some degree, that too reflects a national trend: The total number of private jobs in America grew by more than 43 million over the past three-and-a-half decades.

These changes reflect an economic principle known long before globalization became a staple of our lexicon. David Ricardo’s theory of comparative advantage, introduced nearly 200 years ago, explains why so much manufacturing is done outside the U.S. these days. To put it in practical, broadly true terms, we might say this theory means it is mutually advantageous to us and other countries if we design, market and sell products they produce.

Now, right about here you may register a complaint that a job at a discount store isn’t as good as one at a textile manufacturer. Maybe, maybe not; it depends on the job.

You may also pipe up about the need to educate and retrain the workers who would have been making those sheets and towels. No argument there.

But neither case represents a failure by the manufacturer shedding jobs or the retailer adding them. Each did what virtually all businesses did when faced with the same realities.

Nor is this somehow a failure of free trade. When goods made in Place A can be shipped easily to any other Place B on the planet, free-trade agreements merely ensure consumers aren’t penalized for the comparative advantages at play.

It is, however, a failure of policymakers to ignore the things they do that distort the picture, such as making our energy and labor prices higher than they need be.

How we might address that failure, rather than blaming those who dealt with these larger forces as best they could, is a subject actually worth debating.

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208 comments
ComradeAnon
ComradeAnon

What a conservative justifies. I thought your mantra was "Jobs, Jobs, Jobs". Not any more? No, now "Outsourcing" is centrist. Those Democrats you refer to, they switched parties. They're all republicans now. Hypocrite. 

LilBarryBailout
LilBarryBailout

The U.S. and Canada are in the midst of an historic boom of energy discovery and production. Mexico is on the cusp of exploiting its own vast energy resources. Unless the laws of economics have been repealed, the benefits of deepening the integration of these three neighboring economies in new jobs and per-capita wealth would be enormous. What’s missing is the political leadership necessary to start assembling one of the world’s most powerful economic regions.

That’s not entirely fair. There is indeed active political leadership—in Canada. Prime Minister Stephen Harper has decided he can’t wait for an American President who is still giving speeches about building his new economy around solar panels and windmill farms.

In September Mr. Harper visited London to ballyhoo the trade agreement completed between Canada and the European Union. Most notable, and disconcerting, was a remark Mr. Harper made there about the United States: “We know that the United States is unlikely to be a fast-growing economy for many years to come,” Mr. Harper said. “We’re in a globalized economy,” he added, noting it’s imperative to get Canada’s businesses into the global supply chain.

http://online.wsj.com/articles/home-team-advantage-1412900487

RafeHollister
RafeHollister

@LilBarryBailout He is also tired of waiting on Obama to OK the Keystone, he is now studying a plan to run the pipeline through Canada due east and load tankers in a Canadian port. That, if approved will cost us more jobs and money.  The proggies strategy of denying the pipeline to keep the oil in the ground is going to fail, big surprise.


Procrastination can be deadly to your economy.

Trefusis
Trefusis

@Jazzpman: I really fail to get this, daddy-O. All these people, they're so smart and caring, yet they continue to seek political champions.  Isn't it clear by now that we had better take matters into our own hands?  A Republican, I'd sooner vote for half of you Democrats than go into the booth next month. You folks are engaged and sentient. Heaven knows we cannot say this of most of our serving representatives.  Were any of you to spend three working days on The Hill, you'd come back broken-hearted. 


You actually dig, Jazzpman.  I know you do. There's no point in sending our freshest talent to D.C. and you know it.  That place can really hang you up the most.  Howard or Georgetown I could see, but not the other.

Jazzpman
Jazzpman

Kyle what you really seem to say Outsourcing is OK for American's, BUT you don't have any idea's how to create jobs.

You are sounding as Republican as Perdue, or Romney !


Is there any wonder why Georgia is LAST in the nation in Employment ? 

GA Peach
GA Peach

And re the earlier point about how someone who understands why companies outsource work would be a better political leader -- I think Nunn was the one who understood that if our trade agreements required a level playing field and imposed penalities on countries that allowed companies to pay slave wages and pollute the air and water with impunity, then we might save more American manufacturing jobs.  Perdue's response -- just cut taxes.  No.  That's not going to do anything to address the fact that his companies could pay workers in China, India, etc. next to nothing.  He took his companies where he could pay slave wages to reap big profits for himself. 

GA Peach
GA Peach

And as for whether experience outsourcing makes you a better political leader: when you outsource work, you ship jobs overseas and pay your money to foreign workers rather than to Americans. How does that make you a better political leader? 

And finally, re tax inversions -- Since when has an inversion been done to help employees.? They’re being done to help the officers and the shareholders, not the workers.

LilBarryBailout
LilBarryBailout

@GA Peach

Management does things to benefit the owners of a company?  That's exactly what they're hired to do.  Do you not know what businesses are for?  They aren't charities.  They exist to maximize profit for their owners.

GA Peach
GA Peach

@LilBarryBailout I was responding to Wingfield who wrote this in comments below.  You should direct your comment to him: "How does an inversion affect an employee negatively?  If anything, it means there's more money available to pay employees, rather than paying it in taxes to one country when the money was made -- already taxed -- in another."

SockPuppet3
SockPuppet3

Nunn is a charity executive with no real experience in a real business with competitive pressures. Charity executive just has to decide who to give the rich person's money to. Had Perdue tried to keep those jobs here it would have tanked the entire company, so Nunn could say he had "failed old ideas, ruined company, hurt shareholders, people lost jobs". The idea of turning loose a charity executive on what Obama has turned into the world's largest charity (the US government) is beyond idiotic. And I thought people like Michelle Nunn were who the Dems hate- privileged, rich off family money, white, million dollar house, cushy 6 figure job from a fellow 1%er, never really worked at a menial job, etc.

RafeHollister
RafeHollister

@RantNRave But, that is not what he said, that is what you are trying to convince people that he said.

Trefusis
Trefusis

@RantNRave  Sorry I can't let this go, because it's the sort of cant we've been discussing since Kyle Wingfield's deadline. Count me with you.  I think you nailed his weak thinking, and I don't doubt his presumptive self-indulgence in private.  My thing is that we all have got to stop swallowing the nonsense that a politician "makes", or "causes" anything spinning in this hemisphere.  That's ridiculous, I agree.

Jazzpman
Jazzpman

@RantNRave  But Georgia has the worst education almost in the country.. why would you expect change ?

GA Peach
GA Peach

Over the last 35 years, we have had Republican administrations cut taxes and run up huge deficits, only to leave office with the economy on its knees -- Reagan/Bush: 1980-1992 and George W. Bush: 200-2008.  The last Bush really did a number on us, and we all know what happened.  Dems have come in and changed course -- yes, they raised taxes, but they cut the deficit, put people back to work, and people's retirement funds grew.  It's happened at the national level twice.  Trickle down economics does not work.  Look at what's happening in Kansas.  Gov. Brownback -- die-hard Republican -- took office and slashed taxes.  What happened?  Kansas is an economic disaster.  Brownback is going down.  You can spout all of the economic theory you want.  Look at the results.  They speak for themselves.

LilBarryBailout
LilBarryBailout

@GA Peach

"The August seasonally adjusted unemployment rate was 4.9 percent, unchanged from July and down from 5.5 percent in August 2013. Kansas gained 12,600 seasonally adjusted private sector jobs, or 1.1 percent since last year, and 10,900 nonfarm jobs, a 0.8 percent increase."

---------


That's some disaster.

You need to go find some better talking points.

DeborahinAthens
DeborahinAthens

@Lil array, you need to read (not listen to Fox News) about Kansas' fiscal problems. When will you Repugs realize that taxes are a necessary part of the equation to run a functioning government. If you don't want a functioning government, go to a third world country.

GA Peach
GA Peach

@LilBarryBailout Brownback is on the ropes b/c he's made a mess of the economy.  Even R's are waking up.  This is what Perdue wants to do for us. From Forbes, which is no lefty rag:

"Kansas Governor Sam Brownback and his state legislature have embarked on a wonderful natural experiment. Once again we are testing the question: Can tax cuts pay for themselves? The answer– yet again– is a resounding no.

We’ve tried this experiment time and again. And tax cut proponents such as economist Art Laffer continue to insist they can turn fiscal dross to gold: Cut taxes deeply enough and the resultant boom in economic activity will boost revenues. Magic. Painless. Everything a politician would ever want.

Except this is fiscal snake oil."

http://www.forbes.com/sites/beltway/2014/07/15/whats-the-matter-with-kansas-and-its-tax-cuts-it-cant-do-math/

Kyle_Wingfield
Kyle_Wingfield moderator

@GA Peach Given that you only show up for posts about Nunn, I'd have thought you'd be keenly aware of the fact she and Perdue are running to be one of Georgia's senators, not its governor, and that senators don't set state tax policy.

MHSmith
MHSmith

The Republican Party is now the RINO Libertarian Party.

Trefusis
Trefusis

Immediately I could identify with Kyle's premise because we have been receiving mail from these candidates at about an equal pace of twice weekly for four months.  (I keep a file).  And yet I have no real notion of who either of them really is.  So I've wondered about how that possibly could be so.  A hundred years ago there was this expression, "an empty suit" candidate.  Wingfield is trying in part to show us how an empty suit gets outfitted by the best tailors money can buy internationally.  His is really quite a feat of journalism and we ought to thank him.  I don't see this as partisan.  He's treating us to a taste of "process journalism", confected for the few who bother about inner workings. Like it or not, this is a privileged glimpse into how big-money politics actually works today. It's not so much Commentary as it is straight reporting. So instead of slaying the messenger I wish you all would tell which is the worthier candidate.  Because I really don't know.  Wingfield's point in parting--that we mustn't let this happen again--weighs heavily, but we have time to work on that problem.  Meanwhile I want to hear which of these two complete skunks is less stinky.

Jefferson1776
Jefferson1776

You  folks talk a good game but reality shows a different outcome.  Haves vs have nots,  the outcome -- everyone loses.

IReportYouWhine
IReportYouWhine

Obama's Council on Jobs and Competitiveness, 26 business leaders assembled by the president for job-spurring ideas, includes representatives of several companies that have used outsourcing, fueling job creation abroad and job losses in the U.S. Shipping work to low-cost overseas labor markets has been a trend in American manufacturing for decades. The White House has a plan to curb outsourcing, but companies represented on the jobs council reveal just how pervasive the practice is.


http://www.huffingtonpost.com/2012/07/12/obama-jobs-council-outsourcing_n_1666443.html


I'm doubting that Perdue was invited but what ever.

Eustis
Eustis

Based on this, thank goodness for Gov. Deal.

Without his leadership, Georgia wouldn't be at the bottom, but below the bottom.

Trefusis
Trefusis

@Eustis  Don't be silly.  We still score ahead of Mauritius. 

Trefusis
Trefusis

Thank you for writing this, Mr. Wingfield, and for handling it so ably.  You're gonna take some serious heat. Keep the faith, please. 

ThulsaDoom
ThulsaDoom

I had this same discussion with a pair of progs the other night who don't seem to understand the most basic economics. Whether jobs here are lost to this "outsourcing", which by the way has been going on forever, or replaced by new and or more efficient technology, we are better off as a society. The people who temporarily lost jobs will be absorbed by new jobs produced by greater output. The reality, and this has been shown repeatedly throughout history, is that if a product can be sold to the U.S. consumer at a much lower cost that consumer then has more aggregate demand to then spur more domestic aggregate output. And this applies whether a job is lost to new technology or this "outsourcing" nonsense. 


The same example I provided the other night is this. With the advent of refrigeration thousands of ice and milk deliverymen lost their jobs- as did many blacksmiths when the horse drawn carriage was replaced by the auto. So while people are temporarily displaced society is much better off and goods and services are delivered much more cheaply. Those temporarily unemployed ice and milk delivery men quickly found new jobs in an ever expanding economy that expanded because of new efficiencies and technologies that provided an overall net benefit to society. "Outsourcing", or letting other countries produce something at a much lesser cost and thus a much greater benefit to our society, is just doing the same thing as technology advances that also replace jobs. Its a pity that the progs don't understand the most basic economics. And its a pity that all they seem to rely on is emotional rhetoric that plays to the ignorance of their base. 

Astropig
Astropig

@ThulsaDoom 

Excellent analysis.Progs want a boogeyman to blame for every problem in their lives and their leaders assure them that it's the guys on the other side of the political fence.The economic dislocations caused by a truly global marketplace are wayyyyyyy too complex to explain to people that pursue "fairness" as a political and economic goal.Your example was a really good one, but you could give examples all day long and you may as well be explaining economics to third graders.That's one of the reasons that they look to government as the answer to every problem in life-government employees are at about the level of fifth graders and they are simpatico with such economic illiterates.

Yes_Jesus_Can
Yes_Jesus_Can

@Astropig 

The bamster / progressive mindset merely requires the facade of caring, not tangible results. 

Trefusis
Trefusis

@ThulsaDoom Oh kindly do not do this.  Please don't deconstruct a single tree, "outsourcing", when under discussion is a small forest.  You and I and everyone else can undercut like this all the live long day.  I'd prefer to learn what you think of Wingfield's summary judgment. How do you see this thing going?  Look, I've a vote in pocket but I'm disinclined to go with my party slate because, right now we have got a bunch of rascals on our hands and I'm afraid of doing the wrong thing in this significant next cycle.  Kindly say what you know about what's at stake, rather than what you think about the history of our reporter's word-choice, "outsourcing".  I'm trying to figure out whom to trust, or else to distrust the least.  So please temper. It all goes to feedback when y'all amplify so much.

Eustis
Eustis

@ThulsaDoom 

So, what's the plan for all those that lost their job due to offshoring?

MarkVV
MarkVV

@ThulsaDoom 


It is interesting, and amusing, that the disagreement with this analysis is being attributed to “progs,” and that some “cons” happily agree with it. Apparently they have already forgotten the venomous attack on the "progs" and bemoaning the losses of coal mining jobs (and more likely the losses to the coal mining owners) whenever the change to renewable energy resources is advocated.


It is also amusing to consider the claim that “if a product can be sold to the U.S. consumer at a much lower cost that consumer then has more aggregate demand to then spur more domestic aggregate output” and extend it to the logical conclusion: If all (foreign-made) products were sold to the US consumer at a much lower cost, the demand for what domestic output would be “spurred?”


ThulsaDoom
ThulsaDoom

@Tiberius-Constitutionus


Seriously? The middle east is in turmoil with ISIS about to commit genocide and you're spiking the football over OBL being killed? Is this a joke or are you actually serious?

Tiberius-Constitutionus
Tiberius-Constitutionus

@Yes_Jesus_Can @Astropig Hmm.  Results, says he?  In no particular order...

OBL captured and killed?  Check.

Healthcare reform? Check.

Save tanking economy? Check.

Financial regulatory reform?  Check.

End Iraq war? Check.

End Afghan war?  Check.

Reduce deficit to lowest level as % of GDP in a generation? Check.

Triple Dow from GOP-caused lows? Check.

Cut unemployment rate (caused by GOP) by 4%? Check.

Achieve the foregoing in spite of monumental, race-driven opposition? Check.


Etcetera.


RafeHollister
RafeHollister

@MarkVV @ThulsaDoom If all (foreign-made) products were sold to the US consumer at a much lower cost, the demand for what domestic output would be “spurred?”


Well I'll play, maybe remodel the kitchen, add a bedroom, build a swimming pool, get a new roof, drive to FL for a vacation, buy some health insurance, fly off to visit the grandkids, go out for a romantic dinner, take the kids to Disneyworld, rent a movie, subscribe to a magazine, get a manicure, buy a book, enough?

ThulsaDoom
ThulsaDoom

@MarkVV @ThulsaDoom


First of all its simply unrealistic that "all" goods would be produced by foreigners. Secondly, as has already happened, we would be more of a service based economy. The point is that the savings for consumers would spur much more demand for other services and goods. That's the way its been since the dawn of capitalism in this country, and with largely very positive results. And yet again- going by the logic of the progs on here automation and technology advances, which also replace many a job, would result in more unemployment and a worse economy. Yet clearly the exact opposite hands. No difference between automation and improving technology replacing jobs to our overall benefit and outsourcing doing the same. 

RafeHollister
RafeHollister

@ThulsaDoom True, as we have pointed out many times before, the party of hope and change is extremely opposed to any significant change.  They should be re-dubbed the status quo party.

MarkVV
MarkVV

@ThulsaDoom @MarkVV 

It is quite telling that ThulsaDoom  failed to mention my point about the coal miners.

MarkVV
MarkVV

@RafeHollister 

It is getting more and more amusing here. Rafe will “remodel the kitchen, add a bedroom, build a swimming pool, get a new roof, drive to FL for a vacation, buy some health insurance, fly off to visit the grandkids, go out for a romantic dinner, take the kids to Disneyworld, rent a movie, subscribe to a magazine, get a manicure, buy a book.” All the things he will be PAYING FOR. And where is he going to get the money, to do all this as well as buy all those foreign-made goods, if the country will not be PRODUCING anything?

.

GA Peach
GA Peach

@NorthAtlanta @GA Peach @Tiberius-Constitutionus Um, no. That's not correct.  


"Even Sherk at the Heritage Foundation (a CONSERVATIVE think tank) gives Obama credit for forcing the carmakers to go through bankruptcy and the necessary restructuring that followed.The Economist concludes "by and large Mr Obama has not used his stakes in GM and Chrysler for political ends. On the contrary, his goal has been to restore both firms to health and then get out as quickly as possible.""

http://www.politifact.com/truth-o-meter/article/2012/sep/06/did-obama-save-us-automobile-industry/

InTheMiddle2
InTheMiddle2

Gotta go folks, giving away my daughter this weekend. Enjoy..

ernestangelie
ernestangelie

Suggest you read "


Factory Man: How One Furniture Maker Battled Offshoring, Stayed Local - and Helped Save an American Town
It's about how John Bassett III figured out how to NOT outsource. Of course, that would require some loyalty to your own city, state and country. 

InTheMiddle2
InTheMiddle2

@countfive  And limited competition. Stickley makes some of the best furnishings in the world. A very successful company, very expensive and a very small customer base. The more a product moves away from being a commodity the less impact globalization has on the product.  Cotton thread does not meet the definition.

Ralph-25
Ralph-25

Those steeled in capitalism frequently have difficulty understanding that much more goes on in the world and in life than maximizing the bottom line.  Keep the capitalists in their small arena, and let the philosophers and thinkers deal with government and the needs of the people.

InTheMiddle2
InTheMiddle2

@Ralph-43  Who needs producers anyway. If you get hungry just fill yourself up with self indulgent platitudes.

Ralph-25
Ralph-25

@InTheMiddle2 No, the best way is to let the capitalists churn out their goods, pay them a living wage, punish them when they commit crimes trying to take more than their share, and provide them with the support needed for their endeavors (roads, phones, internet, healthcare, courts, law enforcement, and a democratically regulated set of rules that they must obey.  Doesn't sound like anarchy, does it?