Wednesday, May 15, 2013

Race to the Bottom Revisited

At the height of the Great Depression, Pope Pius XI issued the encyclical Quadragesimo Anno  in which he advised that " the right ordering of economic life cannot be left to free competitive forces."  

The recent disaster in a garment factory in Bangladesh should cause Western nations to re-examine their overseas purchasing policies. Chinese coastal factories are moving menial labour westward into the nation's interior. The workers in the eastern factories went on strike, got raises, then saw their jobs move inland in a kind of insourcing the outsourced.  

This story appeared in an 800-word report in The Globe and Mail, but nowhere did it mention "outsourcing."   In the spirit of euphemism, it's now "manufacturing movements" or "moving operations offshore."

China, the world's largest recipient of outsourced business, is itself outsourcing to even lower-wage nations such as Bangladesh, Vietnam and Cambodia.  One can imagine the leaders of these nations making their presentations to rich Western corporations: "Our people are poorer, more plentiful, and more exploited than the other guy's people."

Vying for poor country status constitutes a race to the bottom.  The result is seen in that November 2012 fire in Dhaka, Bangladesh sweatshop that killed 112 women working in unsafe conditions.  They are part of the 300 workers who have died in garment factory fires since 2006 in that country.

Tazreen Fashions made Mickey Mouse sweatshirts for Walt Disney, Faded Glory children's shorts for Walmart, and items with the ENTCE label for Sears.  These corporations claimed ignorance of conditions in the source of their products. Of course, if one closes one's eyes, one cannot see.

The Institute for Global Labour and Human Rights stated that nothing will change unless clothing companies protect workers as vigorously as they protect their brands.  "The labels are legally protected," a spokesperson said, "but there are no similar protected rights of the worker."   That might increase the price to the Western merchants by an estimated 25 cents per garment.  Cheap clothing comes at a high cost.

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