Senate pushes ahead with offshore outsourcing legislation

IDG News Service - The U.S. Senate voted to approve an amendment restricting federal tax dollars from being used on jobs going overseas, a day after a U.S. representative introduced a bill prohibiting federal grants and loans from going to some companies that send jobs out of the country.
The Senate, by a vote of 70-26, voted to approve an amendment from Sen. Chris Dodd (D-Conn.) that would prohibit taxpayer dollars from being used to outsource or take offshore work formerly done in the U.S. The amendment, added to a bill to restructure corporate taxes, would prohibit outsourcing in three areas of government contracting: privatizing of federal work, federal procurement of goods and services, and state government procurement using federal funds.
"American workers are hurting," Dodd said in a statement. "Our nation's chief export shouldn't be jobs for foreign workers. Thankfully this measure says enough is enough. Taxpayers' hard-earned money shouldn't be used to bankroll the loss of taxpayers' jobs to overseas workers."
The Information Technology Association of America (ITAA), which has opposed limits on offshore outsourcing, criticized Dodd's amendment and a bill introduced by Rep. Bernie Sanders (Ind.-Vt.). Sanders' bill, introduced Wednesday (see story), would bar companies from receiving federal grants, loans and loan guarantees if they lay off a greater percentage of workers in the U.S. than they lay off in other countries.
It's unclear how many U.S. companies could potentially be affected by Sanders' bill, which had the support of 50 co-sponsors when it was introduced. Sanders' office didn't return repeated phone calls for comment.
The Sanders bill takes a "very mistaken" approach, said Bob Cohen, senior vice president of the ITAA. "We entirely disagree with its general direction and its specific language. There's nothing about it we would agree with."
The ITAA and other opponents of restrictions on outsourcing argue that the U.S. economy benefits more from free trade than from attempts to save U.S. worker jobs through limits on outsourcing. The U.S. exports more IT-related products and services than it imports, the ITAA argues, and restrictions on offshore outsourcing could prompt a trade war in which nations cut back on U.S. tech imports.
The Dodd amendment could lead to other countries refusing to allow U.S. IT companies to do government work, the ITAA said. The amendment could also result in higher prices being paid on some U.S. government contracts, with the option of sending work overseas eliminated, said ITAA President Harris Miller.
"The U.S. IT software and services industry has a multibillion-dollar surplus with the rest of the world,