Labor and business leaders duel over jobs outsourcing at debate

By Linda Myers

As part of the Mock Election 2004 debate series on campus, labor leader Richard Trumka and business advocate Tom Donohue faced off Oct. 15 in 305 Ives Hall on a topic of contention in the U.S. presidential race -- the outsourcing of U.S. jobs.

Business advocate Tom Donohue, left, makes a point while labor leader Richard Trumka looks on during the Mock Election 2004 debate on U.S. jobs outsourcing in 305 Ives, Oct. 15. Donohue maintained that outsourcing produces revenues that lead to more U.S. jobs. Trumka, who challenged him on what he called the "wage deficit," said: "We can't fix that problem until Tom and the president understand there's a problem." Robert Barker/University Photography

Donohue, who is president and CEO of the U.S. Chamber of Commerce, one of the largest business advocacy groups in the world, asserted: "We outsource jobs to get skills and people at a price we can afford. The country benefits from this," he said, in the form of new and better U.S. jobs created through the cost-savings.

"Tom, it's good for your members, but not for the American public and workers," said Trumka, who is secretary-treasurer of the AFL-CIO, the pre-eminent U.S. union federation. He blamed the practice for pushing U.S. wages lower. "We have a wage deficit, a budget deficit, an accounts deficit, a trade deficit. We're pouring out the country. But we can't fix that problem until Tom and the president understand there's a problem," he said.

The format was similar to the recent televised U.S. presidential debates: each debater responded to questions from a moderator, ILR Assistant Professor Jefferson Cowie. Their answers were followed by their opponent's brief rebuttal, their own 30-second counter-response, then questions from the audience -- a packed house dominated by students from across campus.

While their delivery was relaxed and their tussles almost good-natured, both Donohue and Trumka cited opposing facts and figures to prove their points. For example, Donohue said that only 200,000 jobs had been lost to outsourcing, while Trumka stated that millions of jobs had been lost.

"We have the best employment ever in the United States, with 139 million people working," said Donohue. "We have low interest rates; the percentage of homeowners is going up. Ninety percent of the dollars U.S. companies invest is invested here. We should count our blessings and stop worrying about a one-sentence issue."

"Profits are way up, but wages and salaries are down 6 percent," said Trumka. "If outsourcing is so good, we ought to outsource the CEOs," he added, to applause, then hammered Donohue on sky-high CEO salaries while U.S. workers' wages continued to drop. Compounding the problem, "companies are rewarded to send jobs offshore through the tax code. They are hiding profits overseas," he said.

Cowie asked whether the tax code dispute was just the tip of the iceberg.

Trumka said it was. A bigger problem: "We don't enforce our trade laws, and the administration has rejected our complaints. We have to make trade work for everyone, not just the CEOs."

Asked by a member of the audience about such practices as sweatshops, prison labor and child labor overseas, Donohue condemned them. "I think American companies [hiring overseas] have a moral obligation to offer a fair wage in a safe, clean environment."

"Tom, I'm so glad to hear you say that," said Trumka. "We tried to get workers' rights in trade agreements, but Tom and his legion of lobbyists killed the effort. So, the next time we're up on Capitol Hill, you'll be lobbying with me?"

"Our offices are nearby," Donohue explained to the audience.

"His is the one with the chain-link fence; mine is the one with open arms," Trumka quipped.

"He's just sore because only 8 percent of the private-sector workforce is unionized," Donohue shot back. "One of the reasons they have so few union members is they have been so successful at codifying workplace health and safety regulations into U.S. law that more and more people don't see the need to join a union."

An audience member noted: "A lot of the new nonunion jobs being created in the United States pay minimum wage, not a living wage."

Donohue responded by quoting Herman Kahn: "'Conventional wisdom is almost always wrong.' It's not the case that subsistence jobs are replacing high paying jobs. If it were, 70 percent of Americans wouldn't own their own homes."

"The promises of new jobs being created here aren't being met," disputed another audience member, but the assertion was interrupted by a fire drill bell, which seemed a fitting close to the debate.