Vol. IV, Bulletin No. 6. March 23, 1999
On College Campuses and Well Beyond
The Struggle Against Sweatshops Is Heating UpIt's nothing short of amazing. The movement against sweatshops is growing at a pace unimagined even a year ago. Dispersed and diversified, it eludes serious media attention. One reason: it doesn't fall neatly into any one category of press coverage--business, labor, foreign trade, government, education, local, national, international, or religion--but embraces all of them.The chant of student demonstrators, "Hey-hey, hoo-hoo, sweatshop labor has got to go," has now echoed through dozens of university campuses throughout the United States. The non-violent protests have made the presidents of Duke, Georgetown, Wisconsin, Harvard, Michigan, and other universities aware that the schools are trading in sweatshop-made goods and that they'd better stop.
Speaking at a State Department luncheon on March 17, U.S. Secretary of Labor Alexis Herman said: "Trade is not a end in itself. It is a means of lifting up of the human condition." She didn't relate that statement to the student protests, with some of whose leaders she had met two days earlier, but her point resonates in the anti-sweatshop campaign of the students and other groups. Its goal is not to shut down foreign factories but to lift up the conditions of the human beings who work in them for us.
Nike Improves Air Quality in a Factory in Vietnam
The effect of outside pressure has made a difference at a Nike footwear factory in Vietnam, where a Korean contractor employs some 9,200 workers, mostly young women. An environmental researcher, Dan O'Rourke, who uncovered and exposed dangerous levels of chemical exposure to workers there in October 1997, returned late last year and found "important improvements." O'Rourke's report on his findings, released in mid-March, was summarized in the New York Times under the headline "Nike Critic Praises Gains in Air Quality at Vietnam Factory."
The report, however, did not give Nike a clean bill of health. In fact, O'Rourke's catalog of environmental and occupational health "issues of concern" that still remain is about three times the length of the list of improvements made in the past 18 months. (For the full text of the report, check the Website of Global Exchange at http://www.globalexchange.org/economy/corporations/nike/vt.html.)
Nike's labor relations director, Dusty Kidd, told the Times that O'Rourke could visit any of its 37 Asian footwear factories, where he would find similar improvements. The Times article then quoted Medea Benjamin, Global Exchange's co-director: "This is certainly an astounding transformation for a company that once treated independent monitoring as a public relations exercise...." (For Nike's own analysis of its labor initiatives, see one of its Websites, http://nikebiz.com/social/labor/main.html.)
Action Intensifies on Much Broader Fronts
The report on a Nike factory in Vietnam was just one highlight in a fortnight of fast-moving developments focused on the global apparel and sneaker industry.
Nike 'Public Disclosure' Offer Viewed with Extreme Suspicion
- Nike announced that it would, under certain conditions, disclose the names and locations of its factories, thereby reversing its own previous policy position and breaking ranks with other industry leaders who maintain such information is a trade secret. Public disclosure of factory locations is one of the key demands of the loose coalition called United Students Against Sweatshops.
- In a letter to 34 universities, Nike Chairman Phil Knight said that his company would agree to full disclosure 1) only if all other licensees (such as Reebok and Adidas) would do the same, and 2) only to universities that join the Fair Labor Association, which is the labor standards enforcing arm of the Apparel Industry Partnership, of which Nike is a founding member.
- The University of Michigan became the latest school at which the anti-sweatshop campaign could claim a victory. After a 51-hour sit-in, 30 Michigan students announced that the university had agreed to "the strongest [anti-sweatshop] code anywhere among colleges and universities in the nation." Among its provisions: the University will require licensees to provide full public disclosure of factories that make products bearing the Michigan name.
- Seventeen colleges and universities, including Duke, Harvard, Notre Dame, Pennsylvania, and Princeton (but not Michigan or Georgetown, at least not yet), announced that they would join the Fair Labor Association. The United Students Against Sweatshops, charging the FLA code and procedures as weak (no public disclosure of factories, for example), criticized the universities' move as undercutting "the principles which our universities are demanding."
The harshest criticism came from Charles Kernaghan, head of the National Labor Committee, who has a long and successful record of activism against sweatshops, particularly in Central America. He issued a long "Open Letter to the Students," subtitled "Nike's Offer Is A Trap--It Is The Very Opposite of Empowering The Workers." He attacked the Fair Labor Association's code and procedures as offering "no major challenges to business as usual." (See http://www.nlcnet.org/student/openlet.htm. For more details on the FLA, see the Website of a leading member-organization, the Lawyers Committee on Human Rights, at http://www.lchr.org/sweatshop/main.htm.)
Confusing? Yes, because although the basic problems are relatively clear, the ways to solve them are not, especially since the parties involved do not share identical interests.
Most likely, many will try a two-track approach, in which some Fair Labor Association-affiliated schools will also continue to press their licensees directly. Pharis Harvey of the International Labor Rights Fund, a member of the Association, points out that its standards are a floor, not a ceiling, and that a member-university can insist on stronger standards from Nike and other licensees.
At an East Coast Catholic college that may join the Association, a student activist offered this sage advice to his school's administrators: if you do join, make sure we're represented, not by someone from the financial office, but by a Jesuit or by someone else who teaches corporate social responsibility.
Some Cautions on Designing Codes of Conduct
Disagreements are normal in a movement aiming to reform the employment practices of a global industry that is thriving on its present way of doing business. Amid the excitement of the challenge and the heat of its controversies, the following basic points can easily be ignored.
Business' Own Responsibility. The job of implementing and monitoring workplace standards is an inherent business responsibility. It is an internal function of management that no outside group can perform.
Neil Kearney, head of the Brussels-based International Textile, Garment and Leather Workers Federation, makes an important distinction between monitoring and verification. Monitoring the implementation of a labor code, he points out, must be part of a company's on-going internal responsibilities, much the same as financial and quality control. This internal monitoring should then be "backed up by a system of independent verification of the whole code [implementation and monitoring] process." That's where properly qualified outsiders have a role, perhaps only temporarily, until the workers themselves are able to perform it.
Worker Empowerment. An acceptable code should, above all, support workers in achieving a basic right: a voice in improving the conditions in their place of work. They are in a position to know what a living wage is and what accompanying benefits they need. To quote Kearney again: "It is not the task of codes formulated in the United States or the United Kingdom to determine what is a living wage in Uruguay. That should be done in Uruguay."
Women's Rights. Codes cannot possibly cover all the various problems faced by workers in the far-flung factories of the global economy. But the special problems faced by women workers need special attention, because women now make such a huge and such a vulnerable part of the sweatshop labor force. (For the women's rights provisions of the University of Wisconsin code, see the March 8 HRFW Bulletin.)
International Support. Codes of conduct (and their accompanying enforcement mechanisms) are basically private initiatives to cope with labor problems created in and by the global economy. These instruments, necessary but insufficient for the reforms they seek, need to be buttressed within a framework of international labor rights enforced by law. This is a frequent theme of Human Rights for Workers.
What does that mean, specifically? The International Confederation of Free Trade Unions has just answered that in a cogent new paper prepared for the upcoming deliberations of the World Trade Organization, which sets global rules for global commerce. The 24-page document is available on the ICFTU Website at http://www.icftu.org/english/sclause/escl99wtostat.html.
Reviewing an Economist's Book
'Openness' Often Creates Dangerous Gaps
Those are the main lessons that a Harvard economist, Dani Rodrik, draws from the Asian economic crisis that began in mid-1997. Rodrik's new book, "The New Global Economy and Developing Countries: Making Openness Work," warns against prescribing "openness"--the free flow of goods, services, and capital across national borders--as "the miracle cure for all that ails poor countries." Openness, he writes, should be only "part of a development strategy," but not a substitute for one,
- Good investment risks in foreign countries are hard to distinguish from bad risks. International capital markets do a poor job of telling the difference between the two.
- Being "open" to foreign trade and investment doesn't protect a developing country from economic turmoil. To the contrary, openness can make a country more vulnerable.
- A country's own policies and institutions are the keys to coping with external shocks reverberating from the ups and downs of global markets.
Rodrik downplays the importance of foreign direct investment, and argues that "it is domestic investment that ultimately makes an economy grow, not the global economy." And in opposition to policies that rely excessively on free market mechanisms to foster economic development, Rodrik says that openness heightens the need for a country to have its own set of "complementary policies and institutions" to withstand the pressures of globalization.
Social Insurance as a Cushion for the Shock of Liberalization
What kind of policies? For one thing, "social insurance is an important component [his italics] of market reforms--it cushions the blow of liberalization among those most severely affected, it helps maintain the legitimacy of those reforms, and it averts backlashes against the distributional and social consequences of integration into the world economy."
What kind of institutions? "A strong, widely-based trade union movement," he writes, "is a good thing, not a bad thing." So are strong political parties. So is a strong executive branch of government, especially if it actively reaches out and seeks agreement from representative groups in civil society. He points out that economic reforms designed by an elite will not get popular support if decided without the participation of "non-elites (indigenous peoples, workers, and farmers)."
As things stand in today's global economy, Rodrik writes, elite groups of people in New York, London, and a few other cities "determine whether an economy is judged a success or not, and whether it will prosper." That wouldn't necessarily be bad, he concedes, if such a system worked. But:"It takes too much blind faith in markets to believe that the global allocation of resources is enhanced by the twenty-something-year-olds in London who move hundreds of millions of dollars around the globe in a matter of an instant, or by the executives of multinational enterprises who make plant-location decisions on the basis of concessions they can extract from governments."For further information about this book, check the Website of its publisher, the Overseas Development Council, at http://www.odc.org/publications/pe24bib.html#top.
Diary: Lunch with Jesse Jackson and Alexis Herman
These days I seldom travel from my home in Northern Virginia to Washington, D.C. Too much of a hassle. And I have more than enough work to do in my home office. But the other day I drove to a parking lot in Arlington, took the subway, and then walked from the Foggy Bottom station to the State Department.
I wouldn't have ventured forth except for two reasons. March 17 was a joyfully sunny day. And, in my capacity as editor of Human Rights for Workers, I had received invitations by mail, fax, and telephone to attend a luncheon hosted by the Labor Department for the trade, foreign, and finance ministers of 46 sub-Saharan African nations.
Good thing I went. I never before had the opportunity to sit at the same table with such dignitaries--the Rev. Jesse Jackson and Secretary of Labor Alexis M. Herman, who were the two leading speakers at the event. Both spoke eloquently about accelerating Africa's integration into the global economy in a way that puts people first. That's where I got the quote I used toward the beginning of this Bulletin.
Which reminds me. In his book, "Making Openness Work," Dani Rodrik has a chapter titled "Is Africa Different?" His answer is No; openness can work its wonders there but, as anywhere, definitely not if applied simplistically. I ignored this insightful chapter in the above article, which I completed before the March 17 luncheon. I'll make up for the omission in a review I am to write for the Labor Department's Monthly Labor Review.
Human Rights for Workers: Bulletin No. IV-6, March 23, 1999
Robert A. Senser, editor
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