It was posted in another article, but I found this one with the "same" statement from Greenspan.
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Associated Press
Greenspan Cautions Against Protectionism
Saturday February 21, 1:34 pm ET
By Martin Crutsinger, AP Economics Writer
Federal Reserve Chairman Alan Greenspan Warns That Protectionism Won't Cure Nation's Job Woes
WASHINGTON (AP) -- Federal Reserve Chairman Alan Greenspan, venturing into the politically charged debate over shipping U.S. jobs overseas, warned against resorting to "protectionist cures" to deal with job losses.
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Jobs have become a big issue on the 2004 campaign trail with Democratic presidential candidates blaming President Bush's economic policies for the loss of 2.2 million jobs since he became president.
The issue was highlighted even more last week with the release of Bush's annual economic report to Congress in which his chief economic adviser, N. Gregory Mankiw, said that the growth of service job outsourcing offered long-term benefits to the economy through freer trade flows.
Greenspan said Friday that upgrading educational opportunities for low-skilled workers in America was the best way to deal with increased global competition.
He conceded that there were heightened job insecurities in the current environment in which nearly 2 million unemployed Americans have spent more than a year looking for a new job.
"The protectionist cures being advanced to address these hardships will make matters worse rather than better," Greenspan said in a speech to the Omaha, Neb., Chamber of Commerce. "Protectionism will do little to create jobs and if foreigners retaliate, we will surely lose jobs."
Sen. John Edwards, now the chief challenger to Democratic front-runner Sen. John Kerry, has sought to highlight free trade as a chief culprit in the job losses. Both Edwards and Kerry have said they will re-examine all of Bush's trade deals with the aim of making sure they contained greater protection for U.S. workers against unfair foreign competition.
In warning against increased protectionism, Greenspan did not mention either Edwards or Kerry by name. Greenspan predicted, as he did in recent congressional testimony, that job growth should strengthen in coming months as a result of the rebounding economic growth.
In talking about outsourcing, Greenspan acknowledged that the moving overseas of service jobs -- such as putting customer call centers in India -- had created new anxieties in an American economy that had already seen a steady erosion in manufacturing jobs.
"There is a palpable unease that businesses and jobs are being drained from the United States, with potentially adverse long-run implications for unemployment and the standard of living of the average American," Greenspan said.
But he said it was important to bridge the gulf between economists, who see the widespread benefits of free trade to a country, and the workers whose jobs are lost because of that competition.
"As history clearly shows, our economy is best served by full and vigorous engagement in the global economy," Greenspan said, echoing a point Mankiw made in the economic report.
Mankiw has apologized for comments he made about outsourcing that appeared insensitive to the plight of unemployed workers. The Bush administration this week backtracked on a forecast in the economic report which said that 2.6 million jobs will be created this year, a change that Democrats immediately attacked as raising further credibility issues with the current administration.
Democrats opened a third avenue of criticism on Bush's economic report on Friday when they ridiculed a section of the report that raised the question of whether fast-food restaurants should be reclassified from the service sector to manufacturing since they could be viewed as "combining inputs to manufacture a product."
"Unable to stop the hemorrhaging of American manufacturing jobs, the Bush administration is offering up some world-class job creation sleight of hand: change the definition of what constitutes a manufacturing job," said Rep. George Miller, D-Calif.
In his speech, Greenspan said the better approach to the increased trade competition was to step up efforts to upgrade the skills of the U.S. work force, especially those in low-income jobs most vulnerable to foreign competition.
"Technology and, more recently, competition from abroad have risen to a point at which demand for the lowest skilled workers in developed countries is diminishing, placing pressure on their wages," Greenspan said.
"These workers will need to be equipped with the skills to compete effectively for the new jobs that our economy will create," Greenspan said.
Federal Reserve:
http://www.federalreserve.gov
