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| Obama rants again: No more tax breaks to outsourcers |
| Lalit K Jha/PTI / Washington Jan 28, 2010, 12:48 IST |
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US President Barack Obama today said it was time to end tax breaks to American firms that farm out jobs overseas and help those who create employment within the country, but acknowledged that this alone would not compensate for the seven million jobs lost over last two years.
"To encourage ... Businesses to stay within our borders, it is time to finally slash the tax breaks for companies that ship our jobs overseas, and give those tax breaks to companies that create jobs right here in the United States of America.
"Now, the House has passed a jobs bill that includes some of these steps. As the first order of business this year, I urge the Senate to do the same, and I know they will. They will. People are out of work. They're hurting. They need our help. And I want a jobs bill on my desk without delay," he told in the customary State of Union address.
India has been one of the biggest beneficiaries of outsourcing and could be the worst hit by this move to end tax breaks. The turn of this century saw American companies move jobs abroad that helped them save costs, with no dent on services as countries like India boast of an English-educated workforce -- be it IT engineers or for jobs that had to be done over phone. This trend gave India the name "back-office of the world" and birth to the term 'Bangalored' that means outsourced.
"But the truth is, these steps won't make up for the seven million jobs that we've lost over the last two years.
"The only way to move to full employment is to lay a new foundation for long-term economic growth, and finally address the problems that America's families have confronted for years," Obama said.
He also announced that US would invest massively in skills and education of its people.
"Still, in this economy, a high school diploma no longer guarantees a good job. I urge the Senate to follow the House and pass a bill that will revitalise our community colleges, which are a career pathway to the children of so many working families. To make college more affordable, this bill will finally end the unwarranted taxpayer-subsidies that go to banks for student loans," he said.
"Because in the United States of America, no one should go broke because they chose to go to college.
The US president also announced that he intends to double US exports in the next five years, sending an indirect message to China and other export-reliant economies that they are not the only ones aggressively seeking new markets.
"We have to seek new markets aggressively, just as our competitors are. If America sits on the sidelines while other nations sign trade deals, we will lose the chance to create jobs on our shores," Obama said.
"But realising those benefits also means enforcing those agreements so our trading partners play by the rules," he said, adding that US will continue to shape a Doha trade agreement that opens global markets.
Talks on the Doha round of World Trade Organisation started in 2001 and have stretched without result so far.
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