(FORTUNE Magazine) – Could we all please take three deep breaths and resume thinking clearly about jobs? The election-year hysteria over outsourcing, or, more precisely, "offshoring," has thrown up such a whirlwind of half-truths, spurious trends, and scary statistics that millions of Americans, including media chatterers and presidential candidates, have snapped into panic mode, when rational thought becomes impossible. The simple truth is that America's job situation really has changed, but the change needn't be disastrous. As a nation, we can get through it fine--as long as we accept some new realities.

What's different? Most strikingly, that we're 22 years into an economic expansion yet still some two million jobs short of what we had just before the last recession. Historically, that's bizarre. Combine that anomaly with a presidential election, and furious blame-fixing becomes unavoidable. Thus, the conventionally accepted culprit in America's job problem is offshoring, the traitorous practice in which rapacious U.S. employers fire blameless Americans and hire foreigners--all of whom seem to live in Bangalore--who happily do the same work for a lot less money.

But of course offshoring is not part of what's different. It's been happening forever and will always happen. So as a culprit, it doesn't work very well--after all, it was happening through those previous economic expansions, when jobs did start growing again. My own candidate for an explanation of today's job stall is 0% real interest rates, which give companies the strongest impetus in 40 years to buy labor-saving capital equipment instead of hiring new workers. But it's tough to shake an angry fist at low interest rates, and much easier to blame faceless foreign workers. And people will always blame someone or something when jobs are scarce.

The other major factor that's different this time is the nature of the jobs that are going overseas--higher-level, higher-paid jobs requiring more education than the factory jobs we've been losing for decades. That change has sparked multiple effects. It has spooked a new group of potential victims, who happen to be more likely to vote, give money to political candidates, and write letters to the editor. Members of Congress and media commentators are more likely to know these people. For many of America's opinion shapers, the ancient practice of offshoring has suddenly acquired a personal connection.

In addition, the sight of managerial positions and jobs requiring graduate degrees being shipped abroad has sparked a sinking feeling in many stomachs, caused by fear that America is losing something essential to its role in the world. There's a difference between doing the work and running the show. We've been running the world's economic show for 60 years. If billions of Indians and Chinese are gaining the skills to run it, that's a much larger concern than whether your Nikes are made in Texas or Thailand.

Faced with a genuinely new and troubling job picture, some people are responding in dumb ways. Several state legislatures--California's, Michigan's, New Jersey's, and many others--are considering bills to stop the states from doing business with companies that have offshored jobs, or to penalize those companies in vying for state business. Senator John Kerry recently proposed a nutty tax plan that would penalize the offshore operations of U.S. companies. Such moves simply tax American consumers and investors, while any benefit to U.S. workers is extremely hard to spot.

The gnashing of teeth and rending of garments will only get more intense between now and November. As a way of keeping a level head through the theatrics, remember two facts:

* Free trade doesn't make us poorer. It makes us richer. Lousy productivity is what makes us poorer. Stopping offshoring will hurt America, not help it. If we want to improve our lot, we should focus on factors that drag down our productivity vs. the rest of the world's: an education system that's nowhere near world-class, an insanely abusive litigation industry, and high or ill-conceived taxes.

* Wealth is not the same as dominance, and what we should care about is wealth--that is, the living standard of Americans. Our reign as the world's utterly dominant economic hyperpower is ending. I probably won't live to see China eclipse us as the world's largest economy, but my kids will. That's okay, as long as we keep our eye on the goal of creating a richer nation.

Which we can keep creating, if today's job hysteria doesn't derail us.