The political debate over outsourcing has been dominated so far by sweeping generalizations. Free trade is either "good for America," or companies that ship work overseas are run by "Benedict Arnold CEOs."

But at some point, someone has to suggest some real-world solutions.

And that gives Robert Litan hope that the time for his idea may finally have come.

In March 2001, Litan, a Brookings Institution economist, and Lori Kletzer, a University of California-Santa Cruz economics professor, wrote a paper advocating that the United States set up a program of wage insurance, combined with subsidies for health insurance, for workers who lose their jobs through no fault of their own.

The basic mechanism is simple, even if the details can get complicated.

Unlike unemployment insurance, wage insurance would take effect only after a laid-off person finds a new job. If the new position pays less than the job he lost, he would get half the difference between his new and old salaries, up to $10,000 annually, for two years. He would also qualify for subsidies on health insurance premiums until he found new work.

Litan and Kletzer wrote at the time that "no American president will be successful at persuading ... the American people to accept further trade liberalization until additional measures, aimed specifically at easing the pain of worker dislocations and encouraging rapid reemployment, are embraced by federal policy makers."

Since then, the pace of American companies moving jobs to cheaper offshore locations has picked up considerably and is becoming one of the main issues in the presidential campaign. Just two weeks ago, Republican Sen. Charles E. Grassley of Iowa complained during a hearing: "I don't have a single town meeting where something isn't brought up about outsourcing."

Litan and Kletzer also said when they published the paper in March 2001 that the timing for wage insurance might be good because the federal government was enjoying budget surpluses.

But that was before the Sept. 11 terror attacks, the invasion of Iraq and the passage of a major tax cut, which have combined to create a federal budget deficit.

Yet Litan now thinks that actually might make it easier to pass a broad wage insurance proposal.

With unemployment running at about 5.6 percent nationally, Litan estimated recently that the cost of providing temporary wage insurance and health insurance subsidies for all displaced American workers under his and Kletzer's plan would be about $4.5 billion to $5 billion a year.

"Ironically, in a way, the budget deficit has liberated us. When I proposed this, $4.5 to 5 billion sounded like a lot of money. Today when you send $87 billion to Iraq and pass trillions of dollars in tax cuts, it doesn't sound so bad.

"To me, a program that addresses the most important anxiety in America today for $4.5 to $5 billion sounds like a bargain. ... Everyone is obsessed about outsourcing now, so there's more impetus to do something like this."

Litan's program wouldn't have to start from scratch in Congress. A small, pilot version of wage insurance already exists.

The test program was put into the 2002 trade bill, but it is so narrowly focused and so new that Department of Labor officials say they have no idea whether anyone has taken advantage of it yet.

Under the current program, a worker not only has to show he lost his job because of trade competition, but has to be over 50, make $50,000 or less in any new job, and be reemployed within 26 weeks of being laid off.

With outsourcing becoming a hot campaign issue, Democrats are working to expand the wage insurance program, but will probably try to do it incrementally, rather than pushing for the full-scale program Litan favors.

"Our goal is to work toward [Litan's] goal," said one top Democratic Senate aide who asked not to be identified. "But you have to do it in steps." The next step will probably be to try to lower the minimum eligibility age to 40, and to boost the subsidy for interim health insurance.

Still, the aide said, the wage insurance idea "makes so much sense it seems like it's intellectually building up support," even among some conservatives, because "they don't like unemployment insurance where you're paying people not to work, so wage insurance gives them that incentive to support it, because it puts people back to work."

Besides expanding wage insurance, both Democrats and Republicans have started discussing the possibility of adding white-collar workers to the traditional Trade Adjustment Assistance Act.

That bill provides unemployment benefits and training tuition to manufacturing workers who lose their jobs because of foreign competition, and there has been talk of adding certain service workers like call center employees or engineers to those who qualify.

Senate Democrats also plan to seek additional tax credits for domestic manufacturers who promise to create jobs in the United States.

Earlier this month, the Senate passed an amendment that would expand the ban on sending any federal contract work overseas, although most experts feel that's a largely symbolic gesture because government contracts comprise so little of the work being done offshore.

Litan said one reason the wage insurance plan has not made more progress is that "politicians are reluctant to admit to voters that the right thing is to help them transition to some other job."

"I think that it's easier for them to tell people, 'We're going to stop you from losing your job,' " even though it will be virtually impossible to halt the outsourcing trend and other forces that have led to major layoffs.

If wage insurance were universal, who would pay for it?

Litan said if the recent tax cut were repealed just for the top income bracket, it would generate $400 billion in recaptured revenue over 10 years, or eight times as much as the wage insurance plan would require. Others, he noted, have suggested a tax on imports to help pay for the program.

On top of that, he said, a wage subsidy would in effect pay for any retraining a worker might need to learn his or her new job.

But he also knows there is only one way this issue will enter the public consciousness.

"It has to be publicized. If people know it's like unemployment insurance but better, and it's available, it's not going to eliminate your anxiety, but it's at least going to make you feel like the government cares about you."