Detroit Free Press Knight Ridder/Tribune Business News
Sep. 17--Does unfettered global trade help or hurt Michigan? Probably.
To air both sides of the divisive issue, the Michigan Chamber of Commerce hosted a debate Thursday in Ann Arbor between Daniel T. Griswold of the laissez-faire Cato Institute and Mark Gaffney, president of the Michigan AFL-CIO.
While their philosophical differences are significant in many instances, they could not even agree on the basic facts, such as an estimate of jobs lost to off-shoring, the practice of hiring overseas companies to do work formerly done in the United States.
Gaffney estimated that off-shoring accounts for about half of the jobs lost during George W. Bush's presidency. Griswold cited Labor Department statistics that put the number at only 2 percent.
Both speakers referred to a Forrester Research study that an estimated 3.4 million jobs could be lost overseas in the coming years. But Griswold argued that was a 'drop in the bucket' among the 138-million-strong U.S. workforce.
Fighting trade and overseas outsourcing, he said, just slows the economic progress of this country and those with whom we do business.
'Trade and prosperity are a package deal: The more we trade, the more we prosper. The more we prosper, the more we trade,' he said.
But Gaffney said there should be some limits that would produce a more humane economy.
He cited the decision of Electrolux AB to close its UAW -represented refrigerator plant in Greenville, although it had admitted to the union that the factory made money. But the Scandinavian company turned down union concessions and state tax breaks because it believed it could earn more money with a plant in Mexico, Gaffney said.
The state should have an obligation to capture some of the benefit companies gain when they move work to lower-wage sites, to compensate communities that lose out unfairly, he said. He doesn't have a plan for how to administer such a system, but he said it could be figured out.
The idea of a company pleading its case to a bureaucrat for the right to close a plant made Griswold shudder. 'It's a truly scary scenario,' he said.
In a lively Q&A session that followed, the two men were able to find a couple of points upon which they could agree, such as the need for better unemployment insurance and training for workers who lose their jobs and the need to improve the health-care system -- again, particularly for unemployed people.
'We need to help people get over the short-term pain of change and take advantage of the long-term opportunities,' said Griswold.
DiAnna Stephens, representing Grand Rapids-based Cascade Engineering , a plastic injection-molding company with more than $150 million in annual revenues, said she appreciated the debate on outsourcing. She said her company tries to do business in Michigan where it can but sees itself as part of the global economy and also makes investments overseas.
'I think it's like health care -- there's not an easy solution,' she said.
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