Congress mulls plans to curb outsourcing

HOUSTON – One of President Donald Trump’s possible solutions to American companies setting up manufacturing operations outside of the US is to institute a stiff border tax on imported goods.

Both Democratic and Republican lawmakers agree more needs to be done to stem the tide of American jobs leaving the country, but they have differing ideas on how to accomplish this goal.

“I have an area where those are the jobs we lose,” said U.S. Rep. Gene Green, a Democrat.

Gene Green sees the problem of outsourcing firsthand. His district is filled with factories and refineries on Houston’s east side.

“Those are the jobs that are the backbone of my community, and Mexico has offered a lot of incentives for companies to move there,” Green said.

Channel 2 Investigates showed you how Chihuahua City is just one example of an area in Mexico with a huge manufacturing base hosting several American companies. Low worker wages are a big part of the equation.

“In Mexico, I don't want to compete with them on the wages because they will win every time,” said Green.

Green said America needs to renegotiate trade deals, particularly ones where our manufacturing bases are expressly protected.

“We want our neighbors to be successful, but we don't want them to be successful at our detriment and that's what's been happening,” said Green.

Green disagrees with a border tax, saying it would wind up ultimately hurting American consumers.

“Are you going to make that oil from Mexico 20 percent higher than it is on the world price,” said Green.

U.S. Rep. Kevin Brady, a Republican, does agree with a border tax on imported goods, but is also calling for zero tax on goods exported from the US.  Brady is also calling for a reinvestment of import-tax revenue to help lower income tax rates.

In a statement to KPRC, Republican Congressman John Culberson wrote, “Returning jobs to America is a top priority. For too long burdensome regulations have made it more attractive for many industries to move manufacturing operations out of the U.S. We need to do a better job at creating an environment that is pro-business and pro-growth. There are many great examples of companies who proudly and competitively manufacture in the USA but we have to make it economically smart for them to stay. The federal government has to roll back unnecessary regulations to restore America’s competitiveness.”

KPRC will continue this series tomorrow, when we speak with an economist at the University of Houston who argues that Americans should focus more on innovation.