Outsourcing Paul Samuelson
The grand old man of liberal economics speaks out, in the NYTimes. An excerpt:
[mainstream economists] are perpetrators of what Mr. Samuelson terms "the popular polemical untruth."
Popular among economists, that is. That untruth, Mr. Samuelson asserts in an article for the Journal of Economic Perspectives, is the assumption that the laws of economics dictate that the American economy will benefit in the long run from all forms of international trade, including the outsourcing abroad of call-center and software programming jobs.
Sure, Mr. Samuelson writes, the mainstream economists acknowledge that some people will gain and others will suffer in the short term, but they quickly add that "the gains of the American winners are big enough to more than compensate for the losers."
That assumption, so widely shared by economists, is "only an innuendo," Mr. Samuelson writes. "For it is dead wrong about necessary surplus of winnings over losings." Trade, in other words, may not always work to the advantage of the American economy, according to Mr. Samuelson.Now, Mr. Samuelson has also recently endorsed John Kerry, so it appears he (Samuelson, not Kerry) is on a roll.
Another article, by Josh Bivens. A pretty reasonable treatment, considering it comes for the Center for American Progress.
Perhaps not surprisingly, K. Grease finds the response of Bhagwati, et al rather more convincing. Can we outsource Paul Samuelson to Bangalore, in exchange for some better code for MICROSOFT Service Pack II?