Kerry Set For Victory; States Consider Limiting Outsourcing

DOBBS: "Exporting America" tonight.

We have reported here on a number of state governments in this country that have chosen to use cheap foreign labor for state government work. Now nearly two dozen states have laws pending that would ban the exporting of state contract work to cheap overseas labor markets.

But, as Bill Tucker now reports, many of those bills are riddled with loopholes.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): New Jersey was the first state to consider prohibiting the outsourcing of state contracts to overseas workers. It now has a lot of company. But, as of yet, not a single state has been able to pass a bill. And none will if the National Foundation for American Policy gets its way.

STUART ANDERSON, NATIONAL FOUNDATION FOR AMERICAN POLICY: State bills to limit outsourcing would raise costs for taxpayers, would send negative signals on foreign investment, which would hurt job creation in those states. And it would put at risk, because of potential retaliation, many U.S. jobs in export industries.

TUCKER: Forty states already rely on overseas help desks for their food stamp recipients. And workers in overseas call centers also process a great deal of private and financial information.

Concerned about the issues of privacy and jobs, one legislator in North Carolina has a pending bill to address both.

ERIC REEVES (D), NORTH CAROLINA STATE SENATE: First of all, I thought it was a bad idea to be able export citizens' personal information to another jurisdiction, No. 1. And then, No. 2, I thought it was a real outrageous activity to be getting this work to be done outside of the country.

TUCKER: Most proposed legislation does not go as far; 22 states currently have some sort of anti-offshoring legislation pending, ranging from forcing call centers to tell people where they are located to banning state contracts from overseas workers.

ROBERT SANCHEZ, ZAZONA.COM: There's only one bill that I'm aware of that even mandates that American -- Americans are able to take the jobs. In most other cases, they allow for what we call the insourcing of jobs by using H-1B and L-1 visas to import cheaper foreign labor.

TUCKER: In other words, the work could still be done here, but with tax dollars going to foreign companies using foreign workers.

(END VIDEOTAPE)

TUCKER: Now, federal legislators recently made headlines with their ban on offshoring of U.S. government contracts. But what most people probably don't realize, Lou, is that provision expires at the end of September.

DOBBS: We'll see, as they say, how the summer goes.

Bill, thank you -- Bill Tucker.