Schwarzenegger terminates anti-offshoring bill

A law that would have banned the State of California from contracting with companies that did work outside the U.S. was vetoed by Governor Arnold Schwarzenegger on Wednesday.

In all, Schwarzenegger vetoed three separate bills that would have prohibited state agencies from using state funds to award outsourcing deals to companies that had work done overseas. Sponsors of the bills argued that taxpayer money should only go to companies that planned to create work in the state of California, or at least the U.S. Under the bills, California state agencies would be prohibited from outsourcing work unless that contractor could certify that all the work would be performed inside the U.S. by U.S. workers.

Schwarznegger disagreed in a statement posted on his Web site, saying that California needs to remain part of the global economy in order to fully recover from the recession that harmed many of the technology-rich state's residents.

"In today’s global economy, the best approach to create and enhance job growth in California is to provide a competitive business environment. In order to improve their competitiveness in a global market, California businesses cannot be penalized with punitive policies restricting their ability to make decisions on how to best perform and provide goods or services for state government and our consumers," Schwarzenegger said in a statement posted on his Web site.

Assemblywoman Carol Liu, who represents several communities in Southern California, sponsored the bill. California currently is using call center workers in India for its food stamp and welfare programs, according to an article from the Los Angeles Times referenced on her Web site.

Vetoes can be overriden, but the California legislature has adjourned for the year, a spokeswoman for Liu said. Liu's office might pursue a similar measure next year, the spokeswoman said.

The IDG News Service is a Network World affiliate.