Offshoring: The reality behind the politics

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The reality behind the politics May 7, 2004, 4:00AM PT Out of all the vitriol surrounding the offshore-labor question, remarkably few concrete suggestions have emerged to address this controversial trend. In stripping away the hype, this CNET News.com special series examines the social, economic and political dimensions of offshoring and offers tangible steps that can be taken for the U.S. industry to maintain its historical lead in high technology. The report includes a poll of nearly 500 key industry decision makers, conducted jointly with Harris Interactive, the research firm that created The Harris Poll. Day 1: Government officials, business leaders and academics agree that the future of America's technology complex depends on education, professional training and research investment. Day 2: Although many U.S. technology businesses are contracting or considering some form of foreign outsourcing, they are adamant about keeping intellectual property at home--for now. Day 3: In stark contrast to the heated reaction among many U.S. workers, the country that is most associated with offshoring is both subdued and puzzled by the opposition that has arisen. Day 4: Rather than trying to reverse the outsourcing wave, the best way for America to fend off foreign competition is to invent technologies that will drive a new industrial cycle. Taking the presidential campaign offshore President George W. Bush and Democratic challenger John Kerry have yet to take definitive stands on the controversial topic of offshore outsourcing, but both candidates have made various proposals to strengthen America's global position in high technology. President Bush Opposes limits on international trade in general, as reflected in his top economic adviser's . Supports a permanent R&D tax credit for businesses and seeks record federal R&D spending of $132 billion for next year. Proposes a budget of $14.6 billion next year for training programs and grants for technical and two-year postsecondary schools, a 6.7 percent increase from this year's budget. Touts the No Child Left Behind Act, which calls for more accountability in schools, as a key to lifting student performance. Sen. Kerry Calls for federal contract work to be performed by American workers "wherever possible." Agrees that the R&D tax credit should be made permanent and proposes a tax reform plan designed to encourage companies to create jobs in America and stop shifting them overseas. Advocates increased spending for "key research programs and agencies," such as the National Science Foundation and National Aeronautics and Space Administration. Seeks expanded education funding--partly through a "State Tax Relief and Education Fund" that would allocate $25 billion over two years--and proposes a tax credit on the first $4,000 of tuition for each year of college. Editors: Mike Yamamoto, Karen Said Copy editor: Zo&#235 Barton Design: Marla Price Production: Andrew Lottmann

Offshoring: The reality behind the politics

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