DOBBS: Congressman Adam Smith joins us. He's the Democrat of Washington state.
Congressman, good to have you with us.
REP. ADAM SMITH (D), WASHINGTON: Thanks for having me.
DOBBS: Normally, I'd say that another study isn't needed. But after our weeks and weeks of reporting on the exportation of American jobs overseas, the lack of information is remarkable. How quickly do you believe that the GAO, the U.S. government, can get better information?
SMITH: Well, hopefully, it will be a matter of months.
But I think you're right. We have a lot of anecdotes. We have a lot of stories, but actual hard facts aren't really there. I've read a number of studies that say they just don't know exactly what's happening. And it's important to know exactly which jobs are going overseas and what the future is for jobs here in the U.S. It has many, many policy implications in many, many areas, depending on exactly what jobs are going overseas and, more importantly, what jobs are likely to stay here.
DOBBS: And do you not find -- you represent a district in a state that has a technology leader, if not the technology leader, in Microsoft. Why in the world would we not know, once Congress approves such a thing as an H-1B visa, an L-1 visa, what in the world is going on with those people?
SMITH: Well, I think those are important issues.
The more important issue, to me, is the amount of money we spend on education and job training and the amount of money we spend on subsidies, either direct or through tax breaks for various corporations. We need to know, first of all, if the job training and education dollars are going to train people for jobs that are actually going to be here. And second of all, if the companies that were subsidizing are actually creating jobs here in the U.S. That's the information I want to know. That's over $600 billion that we spend each year.
DOBBS: Well, we have -- we have some information, Congressman. We know that we've got a $503 billion deficit in the current account. We know that we've lost almost 3 -- 3 million manufacturing jobs. We know that the technology is taking advantage -- the technology industry -- of the H-1B and L-1 visas. That's not to say that there are not positive and appropriate uses of those visas in certain cases. But in too many, it's a problem. What in the world are we going to do about it?
SMITH: Well, I -- you know, the visa programs we can talk about. Now I saw your program last night, and there's a few facts that were kind of left out of that.
The H-1B programs has a number of protections for it. am very concerned about the L-1, because it doesn't have those protections.
DOBBS: You're not concerned about the H-1B, Congressman?
SMITH: I think the H-1B is a positive program It brings in, I think, about 95,000 people. It requires that those people be in certain specialized field. It requires them...
DOBBS: Congressman, H-1B visas -- I can tell you -- we asked here in this network -- we have journalists working under H-1B visas. Did you know that? I mean...
SMITH: If you do, then you're violating the law.
DOBBS: Not me, sir. I'm not.
SMITH: Now, well, CNN is violating the law if there are American citizens who can do those jobs, then that does not meet the H-1B visa requirement.
DOBBS: Well that's why I was stunned when you said you were supporting the H-1B visa program, because we can give you case after case that has flowed into this broadcast showing abuses of the H-1B visa program.
SMITH: Well, those need to be enforced. But I can give you case after case of companies in my district that desperately need people with specialized knowledge that they can't find that they bring into the U.S. that help create jobs here in the U.S., companies like Microsoft, Inmunex before they were bought out by Amgen, Boeing -- a lot of different companies grow dependent upon those people. And there are specific requirements.
Now the L-1 visa program has a number of loopholes in it, doesn't have those same requirements, and I am concerned about that.
DOBBS: Well, when does concern translate to action?
DOBBS: We have millions of people in this country, and a lot of them in the technology industry, who are being hammered as a result of misplaced policies, a lack of understanding of international trade. It's remarkable.
SMIIH: Right, and I think focusing on the H-1B visa program is an example of what you're talking about, a misplaced focus on the problem.
Look, we have had a 90 percent decrease in the last years of foreign investment in the U.S.
DOBBS: All right.
SMITH: Our economy is not perceived as a good place to invest money. That is a far larger problem....
DOBBS: Excuse me -- excuse me, Congressman. Say that again.
SMITH: I have -- we have -- the health of the U.S. economy is a far larger problem than the 95,000 people who were brought in last year on H-1B visa programs.
DOBBS: Congressman, did you say -- did you say that this economy is not perceived as a good place in which to invest?
SMITH: In the last three years, we've seen a 90 percent decrease in foreign investment in the U.S. I think there's a lot of concerns about the stability of this economy -- concerns that which we could address. We could build a better infrastructure. We could do a much better job of enforcing the corporate accountability laws.
I watch your tote board on the show and see that two people have gone to jail since those scandals. I mean, we should have laws that say, if you violate those laws, if you steal hundreds of millions of dollars, billions of dollars from people, that money should be taken away and you should be poor for the rest of your life. We haven't done that.
DOBBS: Congressman, I couldn't agree with you more. I'm just -- I have to tell you I'm fascinated with your version to the issue of L- 1s and H-1Bs as a significant part of that.
DOBBS: Let me finish. I listened to you, Congressman. Please let me finish the question. May I?
And the fact is that each one of these is a related issue. You want to put corporate criminals in jail and, frankly, Congressman, so do I. And that's why we've been pursuing this issue for now almost two years on this broadcast since the bankruptcy of Enron. What do you think should be done to corporations who make decisions based on pure, raw labor costs and then cut thousands, in some cases tens of thousands of jobs, and put them in low labor cost countries?
SMITH: Well I don't think we should subsidize them with tax breaks and various other accountabilities.
DOBBS: There's a beginning.
SMITH: But you're suggesting -- if you're suggesting that the U.S. government can go to a corporation and say, We're going to tell you you can't cut cost. We're going to tell you you can't cut these jobs, you can't move them. I mean, that's a degree of government involvement that's likely to backfire.
DOBBS: Oh, Congressman, believe me, the last thing...
DOBBS: The last thing I would ask for is that kind of regulation.
DOBBS: However, I would be curious to understand what your view is of an appropriate trade policy that would put a premium on American labor, because effectively the trade policies in this country, Congressman, I think you would agree right now, mean that a person in this country has to work at almost slave wages in order to compete effectively with many of his or her overseas competitors in the labor market.
SMITH: Well, it depends on the type of job. I mean...
DOBBS: Oh, well, yes it does, Congressman. But in nearly every case, what I'm saying, would you not say is true?
SMITH: Yes, I've to get a couple of words out here in a row in order to get a thought together.
DOBBS: Be delighted to have you do so.
Yes, I think, trade policy is a concern. But again, I don't see where you're going exactly with that in terms of what we do. I mean, should we have a protectionist policy that says, you know, as some have suggested, that we should not trade with countries that have lower labor standards than we do?
I don't think that's the answer. I think there are some places where we can do a much better job of enforcing trade rules. I don't think we've done enough to hold our trading partners accountable for violations of trade laws.
For instance, you know, I represent the area where Boeing's at. Airbus has been subsidized for a number of years. We have not filed a trade action against them. I think we need to be more aggressive on that.
DOBBS: But what are we going to do with Boeing's support from the import-export bank-- export-import bank?
I mean, there -- you know, these things work a number of ways. There are more complicated than simply saying Airbus is subsidized. Boeing enjoys some rather favored opportunities as well, does it not?
SMITH: Sure, but I thought -- I thought part of the goal here was to protect U.S. jobs. I thought that's what we're talking about. And as long as our foreign competitors are going after us. I mean, we had a major...
DOBBS: No, sir. Your word was protectionism. Mine was, what is the appropriate trade policy to insure that American labor is not reduced to slave wages in order to compete effectively?
SMITH: Well, I think we have to be realistic about how we approach this economic issue, and I think that's one of the things that I am concerned about.
You know, what are the options? It's easy to sort of decry the situation and say, You know, this is -- this is horrible. But what specifically can we do? And is it going to help? I think there are things that we could to improve our trade policy. But if the solution is -- you know, basically we have this problem and you're concerned about us having, you know, to work at the same wages as the rest of the world -- if the solution presented is, we are therefore going, you know, to not trade with those countries and not have that competition, I think the cure is worst than the disease.
And as I said at the start, I think there are things in terms of our economic policy that we could do that would help. I mean, we are wasting a lot of money on job training that's not going in the right areas. There are jobs here in the U.S. There continues to be right now in this economy jobs that are unfilled because we don't have people with the training to fill them. That seems to me like a simple problem to solve. Train them for those jobs. DOBBS: It does, Congressman, and -- but it's somewhat more complicated when you think about those high-paying technology jobs that are being exported and some of those low-paying jobs for which we're thinking about educating and training those who have just lost those higher training jobs.
DOBBS: I would be delighted to have you back to discuss this.
DOBBS: You have been absolutely delightful in your consideration. We thank you very much, Congressman Adam Smith. Please come back soon.
SMITH: Absolutely. Thank you.