Saturday, February 21, 2004

Greenspan warns against protectionism

The Associated Press

WASHINGTON - Federal Reserve chairman Alan Greenspan warned Friday that "protectionist cures" being advanced to deal with job insecurities would make the situation worse.

Greenspan said it was a lack of adequate educational training rather than "outsourcing" which posed the greatest threat to future American prosperity.

Greenspan, speaking to the annual meeting of the Omaha Chamber of Commerce, said it was not surprising that there was a high level of job insecurity when more than 2 million people in the work force have been unemployed for more than a year.

He predicted, as he did before Congress last week, that the strengthening economy should lead to stronger employment growth in the months ahead.

Greenspan said the recent migration of service sector jobs, such as employees working in telephone call centers, to India is a new phenomenon.

But Greenspan said that "protectionism will do little to create jobs; and, if foreigners retaliate, we will surely lose jobs."

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