Vol. XI, Bulletin No. 5 May 10, 2006
When Will Globalization's Sweatshop Scandals End?
Another Horror Story, This Time in Jordan
Labor abuses in overseas sweatshops are so common that they are now seldom deemed newsworthy. But year-long research by a worker rights advocacy group has uncovered so spectacular a case of exploitation that on May 3 the New York Times featured it in a long article under a four-column headline: "An Ugly Side of Free Trade: Sweatshops in Jordan."
The spectacular nature of this particular sweatshop scandal is that it is an unusually globalized operation. It involves a large international network of investors, garment manufacturers, retailers, and workers from countries outside of Jordan -- principally Bangladesh and China -- to take advantage of duty-free entry of goods from Jordan into the United States under a joint Free Trade Agreement with weak labor rights provisions (it requires factories only to live up to Jordanian labor law, not to internationally recognized labor rights).
As the promotion literature of one Jordanian free trade zone puts it, the attraction is "duty-free, tax-free, quota-free access to the largest market on earth." Among the big name companies that last year exported $1,200,000,000 in clothing from Jordan to the United States are Wal-Mart, Kohl's, Gloria Vanderbilt, Target, L.L. Bean, Kmart, Sears, and Victoria's Secret.
Worst Conditions Ever Seen by Worker Rights Activist Who Has Seen Much
Exhaustive details on the scandal were revealed May 3 in an illustrated 168-page report, "U.S.-Jordan Free Trade Agreement Descends Into Human Trafficking and Involuntary Servitude," by the National Labor Committee in New York headed by Charles Kernaghan, longtime worker rights activist.. He personally interviewed dozens of workers in Jordan, supplementing research by his staff in Jordan and in Bangladesh.
"These are the worst conditions I have ever seen," Kernaghan, who has seen and documented horrible conditions aplenty in Central America and China, told the Times.
Of the 48,000 workers in Jordan's garment export industry, at least 25,000 are "guest workers" -- men, women, and some children from India, Pakistan and Sri Lanka, as well as from China and Bangladesh. The Jordanian workers apparently are treated in accordance with Jordanian law (no forced overtime, for example), but the guest workers clearly are not, despite the requirements of the U.S.-Jordan Free Trade Agreement.
Times Confirms Dismal Conditions of 'Guest Workers'
Bangladeshis were the most open in discussing their plight. In phone interviews with Times reporters they confirmed dismal conditions, including excessive working hours (up to 20 hours straight), promises of $120-a-month pay that turned out to be less than Jordan's minimum wage, seizure of passports to tie them to one factory, and loss of $1,000 to $3,000 they paid to get jobs in Jordan. The Labor Committee report also includes charges of rape, primitive lodging, physical punishment ("beatings with sticks and belts"), and threats of imprisonment against workers asking for their wages. "Some workers are trying to escape, leaving their passports behind, hiding by day and running by night in an attempt to cross the border out of Jordan."
The Times article, by Steven Greenhouse and Michael Barbaro, has this pointed analysis:
"Such complaints have dogged the
global apparel industry for years, even as it has adopted measures
intended to improve working conditions in factories that produce
clothing for American and European consumers. But the abusive
conditions described show how hard it is to control sweatshops as
factories spring up in new places, often without effective monitoring."
The scandal in Jordan also raises other issues that have dogged the global apparel and other industries for years:
- When will U.S. industrial leaders face up to their
responsibility to reimburse sweatshop workers for years and years of
unpaid and
underpaid wages?
- When will U.S. policymakers face up to the fact that the
present "free trade" system of outsourcing is inherently corrupt, so
evil that even well intentioned corporate codes of conduct and
monitoring cannot cure it?
For the workers who assembled the Stanley retractable steel measuring tapes in New Britain, Conn., a bulletin board on the shop floor foretold their fate. Each week the Stanley Works plant manager posted a chart showing how their wage rates, output per worker, and other measures of performance compared with those at the company's other plants, notably including one in Thailand.
Once Stanley Works in New Britain had a workforce of 7,000 people. By 2002 it was down to 900 as a new CEO, John Trani, cut jobs there. Instead of investing in improved automation in New Britain, he shifted to hand assembly of tapes to Thailand.
All told, Trani closed 43 of Stanley's 83 factories. At the same time, he negotiated the acquisition of four companies, in each of which he promptly fired hundreds of workers. When he left the company after six years as its CEO, the board rewarded him with an $8,000,000 bonus and a $1,300,000 annual pension.
Freewheeling Use of Layoffs Seen as Inevitable as Rain
Shortly after his retirement, Trani was interviewed about his expansion strategy as head of Stanley Works. "At every stage of the process, you've got layoffs," he told Louis Uchitelle, economics writer of the New York Times. "That is just the way it is....If every day it is raining, pretty soon you don't think rain is a bad thing, it is just part of life."
In his new book, "The Disposable American," Uchitelle describes Trani's profit-maximizing activities at Stanley Works as one example of modern management actions and attitudes that have caused what the author calls a national crisis. During the past two decades, at least 30,000,000 full-time American workers have been laid off -- involuntarily and permanently separated from their jobs. Rather than opposing this reckless business behavior, Americans generally have, like Trani, accepted it as the way it is, just part of life.
Three Myths That Bolster Do-Nothing Attitude toward Layoffs
Why this easy acquiescence? "Acquiescence means giving up, seeing no alternative; we bowed to layoffs as the way things have to be," Uchitelle, writes. He identifies three myths as responsible:
- Promising a pay-off. In exchange for
the hardships and disruption from lay-offs, "a revitalized corporate
America
will emerge, once again offering job security, full employment, and
rising incomes." Instead, lay-offs continue at a larger number
than an evolving economy requires.
- Blaming those laid-off for their fate. "They must acquire the necessary education and training to qualify for the work that is in demand in the new economy. If they fail to land good jobs in a reasonable period of time, then that in itself is evidence that they did not take the right actions and are to blame for their own demise."
- Measuring lay-offs entirely in short-term monetary terms. "I found this myth hard to challenge until I encountered and documented a layer of human damage that is difficult to quantify, but is alarmingly destructive, so much so that it sets back companies that are supposed to thrive through the freewheeling use of layoffs."
Meantime, paradoxically, the unemployment rate is often reassuringly low, because that statistic has a narrow measure of layoffs -- it includes only the percentage of people unemployed who actively sought work in the prior four weeks. It doesn't count those who have delayed or given up looking for work, those who "voluntarily" resigned but were actually pressured to quit, those who after being fired accepted jobs at much lower salaries, those who quit ("lay themselves off") rather accept poorer pay and conditions when they are transferred (outsourced) to a new employer, or others in large job categories such as "temps" and contract workers whose jobs have run out.
Americans Obsessed with Short-Term Individual Goals
Uchitelle sees "infectious individualism" as the root cause of mute acquiescence, in that Americans are increasingly fixated on their immediate personal goals, to the neglect of their neighbors and even of their own long-term interests. Yet he is unmerciful in blaming the country's political leadership, both Democratic and Republican, from Reagan and Carter down to the Bushes and Kerry -- as well as a longtime Democratic advisor, Wall Street's Robert E. Rubin -- for policies spreading the infection.
In his concluding chapter, "Solutions," Uchitelle catalogs a series of policy changes that would reduce layoffs. One is to revise trade and tax rules that facilitate the mass exportation of U.S. jobs. But to create a receptive environment for such change, "layoffs must be clearly perceived as a crisis," and at present they are not, among other reasons because both public and private sources "undercount the actual numbers of workers laid off, and in so doing deprive people of the data they need to document how widespread and debilitating the practice is."
France in 'Decline' or Offering a Warning?
Are the recent strikes in France a sign that the country is in decline? Even some French think it is, but William Pfaff, writing in the May 11 issue of the New York Review of Books, has another view, expressed in this excerpt:
"I would suggest a
larger explanation for the prevailing anxiety: that,
as throughout modern history, France functions as the coal miner's
canary of modern society, reacting to political and social forces
before anyone else. France's refusal to approve the European
Union constitutional treaty two years ago caused an international shock
because the voters rejected the view, all but universally held among
European elites, that continued expansion and market liberalization
are essential to the EU, indeed inevitable. The reaction of the
European public [the non-elite] to the French vote seems, on the whole,
to
have been one of relief.
"Similarly, the current unrest in France can be interpreted as a signal of the wider popular resistance in Europe to the most important element in the new model of market economics, its undermining of the place of the employee in the corporate order, deliberately rendering the lives of employees precarious....In short, the business system in the advanced market economies has been rejigged since the 1970s to take wealth from workers, and from the funding of government, and transfer it to stockholders and corporate executives."
"Similarly, the current unrest in France can be interpreted as a signal of the wider popular resistance in Europe to the most important element in the new model of market economics, its undermining of the place of the employee in the corporate order, deliberately rendering the lives of employees precarious....In short, the business system in the advanced market economies has been rejigged since the 1970s to take wealth from workers, and from the funding of government, and transfer it to stockholders and corporate executives."
Top Winners in Globalization's Orgies
In its first annual ranking of the world's richest people 20 years ago, Forbes Magazine listed some 140 billionaires. Three years ago the weekly business magazine found 476; last year 691. This year, it counted a record 793 billionaires globally. They're worth a combined $2,600,000,000,000 ($2.6 trillion), up 18 percent since a year earlier.
The figures are from a March 27 Forbes article titled "Billionaire Bacchanalia."
Questions for Judging Trade Agreements
A new guide for reporters covering international trade urges them to pursue questions like the following in assessing the labor content of trade agreements:
- "Do they address worker rights at all?"
- "Which worker rights are covered?"
- "Which labor rights provisions are enforceable -- subject to penalties for their violation -- and which are merely hortatory?"
- "Do they only require countries to enforce their existing labor laws, or do they also require that national laws meet international standards?"
- "How are labor rights requirements enforced and what are the consequences for violating them? Fines? Trade sanctions?"
- "Are the enforcement mechanism and consequences as strong for violating labor rights provisions as for violating commercial requirements?"
Titled "Covering Labor: A Reporter's Guide to Worker Rights in a Global Economy," edited Anya Schiffrin and Liza Featherstone, the guide has 113 pages of information useful not only to reporters but to policymakers who need to broaden their horizons. One of the seven chapters, "Unrepresented Workers Worldwide," is by Earl V. Brown Jr., a human rights and labor lawyer with the AFL-CIO Solidarity Center.
The new guide is part of a series published by the Initiative to give journalists the background information they need to cover complicated stories involving the world economy. Previous titles include "Covering Oil: a Reporter's Guide to Energy and Development" (with an introduction by Stiglitz), "Covering Globalization: a Handbook for Reporters," and "Business and Economic Reporting: Covering Companies, Financial Markets, and the Broader Economy."
An Affront to Our Values, Or Maybe Not
- Year after year, hundreds of workers, mostly women and children, die in fires in the sweatshops of Bangladesh and other countries that manufacture our clothes, shoes, toys, and other products.
- Every year the global economy produces a bigger crop of millionaires and billionaires under trade and investment rules that give multinational businesses global rights and privileges, without any corresponding duties or accountability.
- Since September 1, 1997, Republican leaders in the U.S.
Congress and the White House
have conspired to keep the federal minimum wage frozen at $5.15 an
hour, thereby keeping millions of American working families in poverty
and
pushing some into destitution.
Blame the media. Of course, the New York Times, to cite a leading example, does expose shocking injustices here and abroad, but these stories do not resonate widely, especially now that TV newscasts are focused more on entertainment than on news. Blame, too, our national leaders, governmental and private, especially the many whose consciences are dulled by political or charitable contributions from the mighty. Yet there are still others to add to the roster of the guilty. For that, it would be wise to look in a mirror.
Being Honest about Our Own Dreams To Be Billionaires
Let's face it. We are all, to a greater or lesser extent, marked by a split personality. As the Scriptures tell us, God's law of justice and love is imprinted on our hearts, but so are the devil's wiles. Obscenely high incomes, and the national and global policies that foster the greedy pursuit of wealth, can and do trouble many of us -- up to a point. That point is where we start dreaming and wishing that we, too, might join the ranks of the top 1%.
The odds of that coming true are infinitesimal. Yet the chance of winning a million dollar lottery, however remote, keeps the hopes of millions alive and engenders a virtual kinship with the big winners in the game of life, or at least an admiration for them. And, meanwhile, the dreams of losers are stimulated by modern TV versions of the Roman circus, like "Deal or No Deal" and "Who Wants To Be a Millionaire?" These are exciting distractions, and more than distractions. They are virtual realities that, like porno movies, render sick pleasure, exposing our innermost cravings.
So, do scandals of injustice and inequity really affront our innermost values? Yes, sometimes, but not strongly enough to make a difference in the real world. All too often we covet the treasures that those scandals produce.
A gloomy situation, yes. But not hopeless, unless we make it so. We need not condemn ourselves to numbed helplessness.
Diary: Caring for Our Grandchildren
The other day our granddaughter, Mai, 5 years old, going on 10, smiled as she looked at her little brother, Thuy, nearing 2, perched on my lap. "Grandpa," she said, "you are his best friend."
Mai and Thuy are in our care on Tuesdays and Thursdays -- two days that are the highlights of the week for Dzung and me. And the times when we can take them for a walk in a nearby park are highlights of those days. Too bad that we don't have a video of their joyful frolicking there, playing on the slides, picking dandelions and cloverleafs as gifts for their parents, and pleading for one more "last" time on the slides before returning home.
On most days, they are eager for me to read to them. They like to make their own choices from a cache of favorite books stored in box on our living room floor. Thuy never seems to tire of the short stories of a dog named "Biscuit" -- more for the simple but brilliant illustrations, I think, than for my raspy voice reading the text. Mai, once a fan of Princess fantasies, has recently developed more diverse tastes, and thereby widened my own education in contemporary literature for children.
One recent morning, at Mai's demanding invitation, Dzung and I accompanied her to her pre-school class. Because of my shabby attire, I was reluctant to go, but I'm glad I did. I'll long remember how proudly she introduced us to her teacher and her classmates.
Watching and nurturing Thuy's and Mai's growth in body and soul, I can't help wondering: What will they be like as teen-agers, as adults? For that matter, what will their world be like? The thought can be frightening. Or inspiring.
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