Sick Transit

Via Volokh, an article from the American Enterprise Institute suggesting that white-collar outsourcing is not a bad thing:

I am inclined to agree with the argument. As the article points out, we went through this same argument with manufacturing outsourcing in the early 90’s. The US economy didn’t fall apart; quite the opposite.

The real issue, however, is that the process of economic rearrangement that occurs in response to outsourcing also tends to redistribute wealth from labor to capital. (Sorry for the crude Marxist terms, but they’re actually quite apt in this case.) So the government’s response needs to be, not protectionism, but rather redistributionism.