IN the 2004 political season, offshore outsourcing — the practice of hiring lower-paid service workers in places like India to carry out tasks previously done by higher-paid American workers — became an important issue.
The debate flared after the annual Economic Report of the President was issued in February 2004, just as the Democratic presidential primaries were heating up and payroll job growth was sluggish. Answering reporters’ questions about a section of the report on trade, N. Gregory Mankiw, then the chairman of the White House’s Council of Economic Advisers, made a statement that would be utterly unobjectionable if uttered in a classroom at Harvard, where he taught before joining the Bush administration and to which he has returned.
