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Who's the real 'outsourcer in chief'? Why Obama, Romney both shoulder blame.

The trend of outsourcing US jobs predates either President Obama or Mitt Romney, but both have contributed to it in different ways, according to one economist. 

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But outside fact checkers have rated some Republican claims – such as one that says $500 million has gone to fund electric-car production in Finland – as exaggerated or deceptive. 

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Similarly, watchdogs including and the Washington Post's own "Fact Checker" have poked holes in Obama's ads. "We found no evidence to support the claim that Romney – while he was still running Bain Capital – shipped American jobs overseas," says a recent analysis by, a project of the Annenberg Public Policy Center of the University of Pennsylvania.

In Mr. Morici's view, the legitimate problem is what he calls inappropriate outsourcing – when the location of jobs and production is influenced by government trade barriers or subsidies, for example. 

He says Obama has contributed to the offshoring trend in several ways: He has failed to take a tough stand on anticompetitive trade practices by China, and he has taken a relatively restrictive stance on oil and gas development in the US, thus shifting energy jobs overseas.

As for Romney, the private-equity industry focuses on buying and reselling businesses – often resulting in the movement of brands, patents, and factories overseas, Morici says. Although private-equity restructuring deals may play a useful role in the economy, they have "an inherent bias toward outsourcing," he adds.

Not every economist agrees with Morici that inappropriate outsourcing is a major problem.

But the voting public views it as a significant concern. One Gallup poll last year asked Americans their top ideas for creating more US jobs. The top solution offered – ahead of tax cuts, stimulus efforts, or streamlining regulation – was to stop sending jobs overseas. 

Outsourcing gets a bad rap even though it's a basic element of a free-market economy, says Morici, an economist at the University of Maryland. Free trade, including the sourcing of parts and labor overseas, brings enormous benefits to the economy, he and other trade experts say. 

"If Americans expect folks abroad to purchase Boeing aircraft and Intel processors, then they had better be prepared to outsource some of what they purchase," Morici writes.


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