[Congressional Record (Bound Edition), Volume 150 (2004), Part 4]
[House]
[Pages 5346-5347]
[From the U.S. Government Publishing Office, www.gpo.gov]




          ANOTHER EPISODE IN THE OUTSOURCING OF AMERICAN JOBS

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentlewoman from Ohio (Ms. Kaptur) is recognized for 5 minutes.
  Ms. KAPTUR. Madam Speaker, I was so interested to hear the prior 
gentleman's remarks from California about jobs. He has been one of the 
primary Members of this institution that has helped to outsource our 
jobs all over the world, China, India, Mexico; so I am sorry he has 
left the floor.
  But I guess I could say, here we go again, another episode in the 
outsourcing of American jobs. And this one is especially outrageous, 
because it involves our U.S. taxpayer dollars.
  The Richmond Times Dispatch in Virginia reported yesterday that the 
big bank, J.P. Morgan Chase and Company, which administers the Bush 
administration food stamp program for Virginia and 37 other States, has 
been exporting administrative jobs since 2001. Why would the Bush 
administration select a big bank anyway to administer the U.S. food 
stamp program, rather than use not-for-profit institutions like credit 
unions and other financial intermediaries located across this country?
  Today now, the Associated Press reports that food stamp beneficiaries 
in 43 States already get help with problems such as replacing lost 
cards by calling toll-free numbers, and these toll-free numbers connect 
them to companies that have contracts with State governments, and those 
companies have outsourced the calls to foreign countries.
  The U.S. Department of Agriculture says it would consider permitting 
a State government to hire private contractors to sign up people for 
food stamps, even though the Federal law says U.S. Government workers 
should handle the job.
  Madam Speaker, this policy by our U.S. Department of Agriculture is 
not only inappropriate; it is outrageous, particularly when you look at 
growing food stamp rolls because of unemployment in this country and 
this administration not extending unemployment benefits to people.
  It is also outrageous because of the growing ranks of the unemployed, 
9 million unemployed workers in this country. Just in Ohio, 347,000 
people without work, and many more having quit looking, so they are not 
even counted anymore. Why not put unemployed Americans at work at these 
call centers inside our country, instead of shipping out these service 
calls, outsourcing the work to other countries like India?
  Something is haywire when we allow multinational corporations to take 
our U.S. taxpayer dollars and give them in the form of government 
contracts to companies that then outsource the work to foreign workers 
and foreign countries. It is absolutely indefensible, when so many of 
our taxpayers cannot find jobs.
  It is ironic. American workers who lose their jobs to unfair trade 
practices might have to talk to somebody overseas in order to get their 
food stamps.
  Think about this one: when we asked the Under Secretary, Mr. Bost, 
yesterday before our committee whether he would consider working with 
the Department of Labor to go into these pockets of unemployed people 
in our country and let them do the call center jobs, he never attempted 
it, and it did not really seem to appeal to him.
  This issue came up during our agriculture meeting yesterday, and as 
the ranking member I asked USDA officials, since they were not willing 
to hire Americans, would they be willing to support a ban on 
outsourcing these U.S. jobs to call centers, primarily in India. The 
USDA, that we pay for, we pay for their salaries, U.S. taxpayers, we 
pay the salary of the U.S. Secretary of Agriculture, of the gentleman 
who was testifying before us, they said, no, they would not ban sending 
the work overseas.
  Now, the Republican practice of outsourcing American jobs cannot end 
one moment too soon.
  Madam Speaker, the two articles I wish to place in the Record that 
document what I am saying is an article in the Associated Press by Ira 
Dreyfuss, and the headline reads: ``Private Contractors May Handle Food 
Stamps,'' and also an article that was in the Richmond Times-Dispatch. 
The headline reads: ``Food Stamp Calls Routed to India. A Firm That 
Runs Part of the Virginia Program Outsourced Call Center to India.''
  Madam Speaker, it would be nice to have some attention in one of the 
largest programs that this government funds, over $50 billion a year in 
various food programs, about two-thirds of that in the food stamp 
program, and try to help some of our own people earn some money in this 
country so they would not have to be on food stamps and they could have 
good jobs right here in the good old USA.

                [From the Times-Dispatch, Mar. 23, 2004]

                    Food-Stamp Calls Routed to India


   firm that runs part of the Virginia program outsourced call center

                           (By Tyler Whitley)

       When food-stamp recipients in Virginia have a question 
     about the program, they get answers from someone in India.
       J.P. Morgan Chase & Co., a giant bank-holding company that 
     administers a key part of the program for the social-services 
     departments in Virginia and 37 other states, has outsourced 
     its call center to the Asian nation.
       Maurice Jones, commissioner of the Virginia Department of 
     Social Services, estimates that six or seven jobs could be 
     created in Virginia to handle the 10,000 calls a month that 
     are now made to India by Virginia's 195,000 food-stamp 
     recipients.
       He said the Warner administration inherited the outsourcing 
     from the Gilmore administration, which signed a contract with 
     another banking giant, Citicorp, in February 2001.
       Louis Rossiter, secretary of health and human resources 
     under then-Gov. Jim Gilmore, said the jobs were not being 
     sent abroad when the contract was signed.
       Rossiter said Citicorp had a near monopoly on the business 
     at the time the contract was signed.

[[Page 5347]]

       The decision to send the jobs abroad was not the state's 
     but the contractor's, Citicorp. It subsequently sold the 
     food-stamp electronic-transfer program to J.P. Morgan, Jones 
     said.
       Jones said the calls have been going overseas since October 
     2001. A disgruntled local official complained about the 
     situation recently to The Times-Dispatch.
       When the state's five-year contract expires in 2006, Jones 
     said yesterday, he hopes the 38 states can put pressure on 
     the bank to return the call centers to the United States--
     perferably to Virginia.
       Outsourcing, largely ignored until recently, has become a 
     major political target in the 2004 presidential campaign. 
     Although it is not a new phenomenon, Democrats are blaming 
     the shipment of jobs to lower-wage countries abroad for the 
     slow pace of job creation during the economic recovery.
       Trevelocity, which provides airfares and travel service 
     over the Internet, recently announced it is closing a call 
     center with about 250 jobs in Diskenson County in Southwest 
     Virginia later this year and sending most of the business to 
     India. It estimated it could save $10 million from the move.
       Richmond-based Circuit City Stores Inc. also has begun 
     outsourcing jobs to India. Its customer-service toll-free 
     line now goes to India.
       According to the American Legislative Issue Campaign 
     Exchange, a Wisconsin-based organization, 22 states are 
     considering legislation to prevent job loss because of 
     outsourcing by requiring state and local government contracts 
     to purchase only American goods and services.
       The U.S. Senate has voted to do the same on federal 
     contracts. ``I'm a firm believer that you ought to take care 
     of your own people first,'' said Del. Clarence E. ``Bud'' 
     Phillips, a Democrat who represents Dickenson County.
       Phillips said he will introduce legislation next year to 
     bar the state from entering into contracts that ship jobs 
     abroad.
       If the jobs are returned to the United States, bank 
     officers have told him that Virginia will have to pay a 
     higher fee for the services, Jones said.
       Jones said he recognizes the irony that someone in Virginia 
     might be receiving food stamps because he lost a job through 
     outsourcing. ``In an ideal world, I wish we could have a call 
     center in Virginia staffed by present or former food-stamp 
     clients,'' he said.
       Food-stamp coupons are not longer given out. The federal 
     government now issues electronic benefit-transfer (EBT) 
     cards, which operate much like debit cards.
       A food-stamp recipient gets a card from the state 
     Department of Social Services with a limit on how much the 
     person can draw. J.P. Morgan handles the monetary transfers 
     for a fee paid by the state.
       J.P. Morgan has call centers in Bangalore and Pune, India, 
     and a center for automated calls in Delaware, Jones said. He 
     said only about 10,000 of the 400,000 monthly calls made by 
     Virginians go to India, where people handle the inquiries. 
     The rest go to the automated call center.
       Repeated calls for comment to J.P. Morgan Chase & Co. in 
     New York City were not returned.
                                  ____


                      [From the Associated Press]

               Private Contractors May Handle Food Stamps

                           (By Ira Dreyfuss)

       Washington.--The Agriculture Department says it would 
     consider letting a state hire private contractors to sign up 
     people for food stamps, even though federal law says 
     government workers should handle the job.
       Eric Bost, undersecretary for food nutrition and consumers, 
     raised the prospect Wednesday after the issue came up at a 
     hearing before the House appropriations subcommittee on 
     agriculture.
       If a state has a better way to provide services and save 
     money, ``it would be foolhardy on our part not to at least 
     consider it,'' Bost told reporters. Florida Gov. Jeb Bush has 
     directed his state Department of Children and Families to see 
     if nongovernment workers could handle applications for food 
     stamps, as well as Medicaid and other Welfare benefits.
       While the governors's proposal envisions a U.S. contractor 
     with American employees handling Florida's food stamp 
     signups, some states already have contracted to have overseas 
     operators handled complaint and service calls regarding their 
     food stamp programs.
       Because the Florida project would be lilmited--a test to 
     see if the concept would work--Bost said he could waive the 
     requirement that food stamp signups be handled by government 
     workers. But allowing all states to do so would require a 
     change in law, he said.
       Food stamp beneficiaries in 43 states already get help with 
     problems such as replacing lost cards by calling toll-free 
     numbers of companies that are contracted by states to operate 
     help lines. Some of these contracts ``outsource'' calls 
     overseas, but it is unclear how many.
       Outsourcing of jobs has become a political issue after 
     President Bush's chief economic adviser said it benefits the 
     economy, a position that was challenged by leaders in both 
     parties this election year.
       Rep. Marcy Kaptur of Ohio, the senior Democrat on the House 
     subcommittee, said at the hearing that the Agriculture 
     Department should be prohibiting all outsourcing of food 
     stamp calls.
       Rep. Allen Boyd, D-Fla., another member of the 
     subcommittee, said he doesn't ``understand how you would 
     determine food stamp eligibility without a face-to-face 
     interview.''
       Easy, responded Bost. ``We have got such sophistication in 
     this country that potentially I can get a loan for a couple 
     of hundred thousand dollars and never see anybody face to 
     face,'' Bost said.

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