"This is the first shot in a trade war in which American IT workers and U.S. IT companies will be the losers," said ITAA President Harris N. Miller. "The U.S. IT software and services industry has a multibillion dollar surplus with the rest of the world, in large part because governments around the world buy products from U.S. IT companies. That means we create more jobs selling to them than they create by selling to us. Yet as the IT industry marches down the field toward the goal line, Senator Dodd wants to call a penalty on our own team, inciting other governments to impose similar restrictions. Trying to protect unclassified government business from overseas competition is a step that is sure to backfire, shrinking markets and harming workers."
Miller said the amendment is bad legislation for numerous reasons:
- Placing prohibitions on where and how nonclassified government work is performed will lead to similar trade sanctions abroad, foreclosing the ability of U.S. companies to pursue international business and shrinking job growth at home;
- Such restrictions raise the cost of doing business at the very time the federal government is running record deficits and state governments are struggling to control spending and balance budgets;
- Adding layers of red tape and restrictions on U.S. companies with multinational operations will cause many to withdraw from government markets, limiting the government's procurement options and diminishing the taxpayer's ability to receive best value;
- Protectionist measures turn a blind eye to economic realities. Keeping barriers to trade low in a global market generates many benefits, including lower costs and prices, reduced inflation, greater Gross Domestic Product, improved job growth and more innovation across an array of industries.
"The media hype about offshoring has outrun the facts in the midst of a political campaign," Miller concluded. "We need a positive approach to meeting global competition and making U.S. workers more competitive, such as the one Sen. Max Baucus just announced, not a return to the trade wars of yesteryear which produced the Great Depression. Smoot and Hawley are long dead, but their spirits will return if the Senate passes this extremely unfortunate legislation."
