Published in Columbus Dispatch Editorial
After years of stumping against the outsourcing of American jobs, Gov. Ted Strickland recently found his own administration guilty of same.
The Ohio Department of Development hired Texas-based Parago Inc. to administer the state's $10.5million appliance-rebate program, which offers rebates ranging from $100 to $250 to Ohio consumers who buy energy-efficient appliances. The money was provided to Ohio as part of the federal economic-stimulus effort.
Parago was paid $357,300, a big savings over rival bids from two Ohio companies of $467,238 and $493,763. If Development Director Lisa Patt-McDaniel had asked why Parago's bid was so low, she might have learned that the company outsources its call-center functions to low-wage El Salvador, where the work probably was much appreciated.
It was an embarrassing goof, leading a wag to dub the Parago contract the "Central America stimulus program." The governor has redoubled his efforts to ensure that state agencies avoid such problems.
Of course, the very concept of government stimulus spending is tangled in contradiction and questions. For example, sending Ohio's stimulus cash to El Salvador was an obvious mistake, but was sending it to Texas all that much better? Whether it went to El Salvador or Texas, it was lost to Ohio. On the other hand, by hiring the out-of-state low-bidder, more money was left to provide rebates to Ohioans who bought appliances at Ohio retailers.
And had the state awarded the contract to a more-costly Ohio company, the money would have stayed in Ohio, but it would have rewarded uncompetitiveness, hardly a strategy for building a successful economy.
Never mind that all the federal money is borrowed in the first place, driving the nation deeper into debt and increasing the burden on future generations of American taxpayers. In essence, we're beggaring our grandchildren to pay for current consumption. In fact, the only people who may come out with a net gain in this deal are those in El Salvador.