This Bud's for the U.S.

If you’re upset about the American icon Budweiser being bought out by (gasp) - a foreign company! - you can settle down. Welcome to the global economy. Bud and Bud Light is not going anywhere, Spuds McKenzie will not suddenly reappear during football season and maybe the Belgians can get Americans to start drinking better beer.

You hear a lot about outsourcing – U.S. companies that send domestic jobs overseas. What you don’t hear about is insourcing, which is foreign companies that come here and provide good jobs in America to Americans. Some of these companies include Toyota, Michelin, ING, L’Oreal, Sony, Nestle, Philips and many others. You’ve probably got several of these companies’ products in your house, and are invested in several of them in your portfolio. In the interest of full disclosure, I work for a foreign company here in Boston, but not one of the ones just mentioned.

Is your U.S. company outsourcing or just shedding jobs like sick icon GM? Foreign companies insource over 5 million jobs in the U.S., and you can soon add InBev/Budweiser to the list. When you pursue a weak dollar policy like the Bush Administration does, you’re basically rolling out the For Sale sign on the border. And that is not necessarily a bad thing – no matter where you live, your governor probably spends much of his time abroad lobbying foreign companies to invest in your state, either by opening a satellite office, building a new plant or buying the state’s bonds. If they come, the foreign companies will create the same jobs and pay the same taxes the American companies do.

And Budweiser (legally Anheuser-Busch)? Before the unsolicited bid, its sales and stock had been basically flat for five years. InBev pulled a neat move by getting renegade family uncle Adolphus Busch in its corner before raising its offer. Missouri’s senators are whining about losing “part of America’s heritage.” They seem to have forgotten that Anheuser-Busch was started by German immigrants, and the brewers had previously announced plans to lay off over 1,100 workers. A foreign buyout is nowhere near a worst case scenario for its workers and stockholders.

Globalization and free trade agreements are frowned upon, but the end result ends up being positive for all parties. Main Street Americans will eventually accept the deal, grumbling into their Budweisers as they pull off in their Ford trucks (which were built in Mexico).

More Info: An Empirical Study on the Economic Importance of Insourcing