In April, John Kerry’s campaign released a TV ad attacking President Bush for supporting the export of U.S. jobs overseas. The ad was misleading — although Gregory Mankiw, the chief White House economist, has said that, “outsourcing is just a new way of doing international trade,” Bush himself has never explicitly said he favors sending jobs abroad. But Kerry’s ad highlighted the fact that Democrats see corporate outsourcing — in which American corporations abandon the U.S. in favor of cheaper sources of foreign labor — as a potentially damaging issue for the president. During the Democratic primaries, both John Edwards and, to a lesser extent, Kerry attacked the president for policies that, they argued, encouraged job loss in the United States. The issue resonated with voters, especially in states like Ohio and Michigan, which have been hit hard by the loss of manufacturing jobs.
Enter Lou Dobbs. The distinguished-looking host of CNN’s “Lou Dobbs Tonight” has established a reputation this year as one of the most outspoken opponents of corporate outsourcing. Dobbs has turned his nightly news show into a one-man campaign — the head of the Business Roundtable called it a “jihad” — against the practice. Night after night, he roundly attacks government trade policies that he believes encourage American corporations to ship jobs abroad.
But it’s not just U.S. policymakers who are the targets of Dobbs’s indignation. He makes little attempt to hide his disdain for the companies that are, as he puts it, “exporting America.” And Dobbs is watched, so it’s fair to say his views sway voters.
In February, Dobbs asked a guest on his show: “The fact is that we are seeing hundreds of jobs being outsourced on the basis purely of a corporation’s interest in achieving the lowest possible price for labor. Does that make sense to you?” Later on the same show, he declared, “Corporate America and U.S. multinationals are shipping jobs for only one reason, not for greater productivity, not for efficiencies, those are purely code words for cheaper labor costs.”
Dobbs even asks viewers to send him the names of companies that outsource. He then posts the list (scroll down) on his CNN website, under the heading, “These are U.S. companies either sending American jobs overseas, or choosing to employ cheap overseas labor, instead of American workers.”
“The results of this issue are crucial to the kind of country we live in,” Dobbs told the Atlanta Journal-Constitution in April.
But there comes a time when Dobbs takes off his anti-outsourcing hat. That’s when he switches from financial journalist to investment advisor-for-hire, peddling a monthly newsletter containing his investment recommendations. Pony up $398 and you receive Dobbs’ investment tips for two years. You’ll recognize some of the companies that Dobbs recommends. That’s because they’re on his list of firms that are “exporting America” by shutting down U.S. operations and opening overseas facilities.
The Lou Dobbs Money Letter is published by Phillips International Inc., which is associated with Eagle Publishing, a leading publisher of conservative-themed books. In each issue, Dobbs singles out one favored company, in which he encourages subscribers to invest. He conducts an invariably softball interview with the firm’s CEO, which allows both Dobbs and his guest to tout the company’s prospects.
Unlike most investment advisors, Dobbs goes beyond talking up the earning potential of these companies. He typically goes out of his way to praise them as good corporate citizens. The newsletter keeps a running tally of the companies profiled, under the heading, “The following companies have been featured in the Lou Dobbs Money Letter as those ‘doing good business with good people.’” The appeal is alluring: You’re not just buying a smart investment choice, you’re buying a piece of good citizenship.
Dobbs devoted a column in the March issue to touting the prospects of the Minnesota-based Toro Company, which makes outdoor landscaping-maintenance equipment. He told subscribers that Toro was a “long-term wealth-builder,” and praised Toro’s “formal code of ethics, something I think is sorely needed at more of America’s companies,” and its “…exemplary corporate governance structure, which aligns the interests of shareholders, employees, and customers.” He concluded his interview with Toro CEO Kendrick Melrose by frankly telling him, “I like the way you treat your shareholders, employees, and customers.”
One wonders whether Dobbs’ admiration extends to Toro’s 2002 decision to move 15% of its workforce — about 800 jobs — to Juarez, Mexico. Indeed, CEO Kendrick Melrose might be interested to know that Toro appears on Dobbs’ own list of companies that are “exporting America.”
And Toro is not alone. Of the 14 companies Dobbs has highlighted for investors since starting his newsletter last year, eight appear on his CNN website as companies that outsource jobs.