Notwithstanding the charges being leveled by the Obama Campaign against Republican presidential candidate Mitt Romney of outsourcing jobs overseas, a top Obama aide has said that both outsourcing and insourcing are here to stay in this highly globalised world.
"It is important to recognise that insourcing, outsourcing, supply chain complexity, supply chain disaggregation, is here to stay," Laura Tyson, former Clinton Administration Chair of the Council of Economic Advisors and now an economic policy advisor to the Obama Campaign, said on the sidelines of the Democratic National Convention here.
"The challenge for the US is to make the US a very attractive place to do business so the US companies decide to stay, bring back, and foreign companies continue to move here. And we shouldn't do anything, as I said, in a biased way to influence outsourcing or insourcing by our tax codes. We have to change our corporate tax code. The President has embraced that," she told reporters in response to a question.
Democratic leaders have accused wealthy Romney of being pioneer of outsourcing jobs overseas and stacking his money in foreign banks.
Tyson said President Barack Obama last year had a big conference on insourcing.
The fact that US companies are beginning to say they'll keep some jobs in the US or they will bring some jobs back is because the energy price environment and the labor cost environment are more attractive.
"So the first thing is the improving cost environment. The second thing is the President has said we should not have tax policies, which actually reduce taxes to help companies move abroad, but then actually we also have taxes which make it less attractive for them to bring the jobs home. Why are we doing that? We need to reform the corporate tax code so it's neither an incentive or a help to send jobs abroad, nor is it a disincentive to bring jobs home," she said.
The Jobs Council of the President has said that other countries around the world are doing a lot to promote foreign direct investment.
"A lot of what they do is essentially selling foreign direct investment. Organising trade missions, foreign direct investment missions, acting as a coordinator between business and government," she said.
"The US government should do more of that at the federal level. The President has set up a new group within the Commerce Department and now the State Department is also doing this, sort of upgrading its economic counsel so they focus much more on foreign direct investment flow inside to the United States," Tyson added.
