When this story first arrived, I tweeted my amazement and left it at that. How could the Federal government be paying for folks in developing countries to learn IT skills and improve their English language skills to make it easier for American companies to outsource decent paying jobs? This goes far beyond abusing H1-B visas for IT workers or having a tax code that stupidly encourages American companies to outsource IT work and call centers, but actively encourages outsourcing by having the American taxpayer pay to teach people in other countries the skills they need to take jobs out of an economy with 9.5% employment.
I was going to let it rest, but Matther Yglesias wrote at both The Progressive Realist and Think Progress that this program is little different from building schools or clinics because those bit of foreign aid might also encourage outsourcing by teaching skills (math and languages) and keeping people alive. He also argues that it is natural for foreign workers with IT and English language skills to seek work with vendors providing outsourcing solutions. His point is that looking at this particular program as a threat to American jobs is overly simplistic and that government efforts that lower trade barriers and improve conditions in the rest of the world are inherently good.
I think, though, that he misses the point. Even if you accept the free trade ideology that free trade improves the lives of people everywhere, that jobs that move overseas will be replaced by value-added jobs here, and that free trade also spreads democracy and capitalist ideals, spending taxpayer money while running gigantic budget, trade, and current accounts deficits with 35 million Americans out of work is fundamentally stupid unless it somehow promises to quickly help fix any of those problems. This program promises to do quite the opposite.
Beyond that, the whole idea that an advanced job skills program to teach is far different from programs that provide basic services such as elementary education or vaccinations. They are an order of magnitude difference, and shouldn't be in the same conversation. The only way the three types of foreign aid might reach some sort of equivalence is in prevention of terrorism, and that's a big stretch since many analyses of the sources of terrorists from the Middle East is that a significant fraction are highly trained engineers that are frustrated by lack of opportunity at home. If that's the case, then this could have the opposite effect by producing a surplus of trained workers with no jobs (although this program does place them with outsourcing vendors).