Because most philosophies that frown on reproduction don't survive.

Friday, February 22, 2008

Don't Buy From the Poor!

I recall reading an article, some months ago, in the Wall Street Journal weekend edition, which profiled the effect that working in an affluent department store was having on the lives of three young men from poor backgrounds. India, with its booming tech economy sitting alongside desperate poverty of the sort seldom seen anywhere in the US, makes the inequalities of the US look like nearly nothing. The three young men in the article had landed jobs as retail clerks where they sold India's upper crust designer jeans and other expensive clothing. In many ways, this was the transition point for them and their families into a better world -- making two to three times what their fathers had made running small sales stalls or doing manual labor. They got used to speaking English much of the time instead of Hindi or their local dialects, and began to spend much of their spare time with other employees. One of the young men saved up his wages to buy a computer for his family -- selecting a model with a TV input jack in the back so that his mother and grandmother could watch TV during the day while he was working. He was proud of the computer, but it had to sit on the floor because there was no room for furniture in the 400sq/ft single room apartment where he lived with three generations of his family.

It was an interesting and very hopeful article, about hard work and people beginning to emerge from poverty into the "developed world". However, it struck me later that the same facts could have been turned into a very, very different article.

A little while ago I heard a very earnest and idealistic young woman bemoan that as she had looked through her closet she had realized that her clothes had all been made in places like Ecuador, Guatamala, Indonesia and China. She felt deeply guilty that she was supporting companies that paid people poverty-level wages in the third world, and wondered aloud where she could find clothes that were made by people paid a decent living wage.

I sympathize with the desire to make sure that one is not supporting companies who actively exploit their workers, but if that desire results in a decision to refuse to buy anything made in developing nations, how are those countries supposed to improve their lot?

Thinking about this, I realized that another author could have written a very different article about those three clerks in India: A tyrannical deparment store chain serves a rich clientelle while its employees live in crowded one room apartments. Young men from poor families are forced to smile and sell designer jeans they could never afford on their meagre paychecks. Even when one of these men saved up for a computer for his family, he had to put it on the floor because they all lived in such poverty. Boycott the store now!

How much is a fair wage? The young men in the story were thrilled to me making 2-3x what their families and peers had made in the past. They imagined they were on their way up. Yet others, I'm sure, would label them as suffering a great injustice by not making more.

One of the primary ways of competing for business is by offering a product of similar quality at a lower price. Say that Country A currently has an average textile manufacturing wage of $10/hr. Country B is across a major ocean from A and is much less developed, with an average wage of just $2/hr and many former agricultural laborers flocking into the cities looking for work. If a company sets up a shirt factory in Country B which pays $4/hr in order to get the best workers and still be able to sell shirts for less (after frieght) than the shirts made in Country B, are they taking advantage of their workers?

Perhaps a highly localist response would be: Country B's poverty is its own problem. They need to develop to the point where their workers also make an average of $10/hr before they are allowed to trade on a level playing field with Country A.

Others, who are not as localist but are very much concerned with a just wage, might say that the employer in Country B was exploiting its workers by paying less than half as much as workers in Country A make, and thus one should refuse to buy anything made in Country B.

But really, doesn't that amount to saying that it's not right to buy from the poor until they're not poor anymore? How are the workers in Country B supposed to work up to making enough to be judged a "fair wage" by observers in Country A?

This is not to say that there is not such thing as a "fair wage" or a "just wage", but it does seem to me that these things are almost certainly relative to general wages in an area and to the value of the result of the labor.

While it is right for people to be concerned about how the workers who produce the products we buy are treated, it may often be that the best way to help those living in poor developing nations rise out of poverty is to buy the products that they make.

9 comments:

CMinor said...

Well, I prefer to think of it as helping a fledgling democracy/free market state get on its feet--and I look for products from countries that fit those descriptions.

Karie, the Regular Guy's Extraordinary Wife said...

My other concern is how much does a company put into a community that is half a world away? Or is the ability of the company's workers to earn so much more enough of a "lift"? Who has the responsibility of helping the community where the company is hiring? Is it just those who live there or should the company be looking for opportunities to help it's employees outside their employment?

Foxfier, formerly Sailorette said...

That's a much nicer version of my mom's rant when one of her friends sniffed at the shoes (or something...don't remember exactly) that mom's children were wearing, asking her if she was *aware* that there were 12 year olds working for only a dollar a day to make the shoes.
My mom replied that she did know that, and wanted to know if the woman had any clue how much a dollar was to that child. Ended being about a week's wages at any other job. Mom then pointed out that her father had worked a full-time job at that age, and that the complaining woman's own children had part-time jobs on the ranch the woman's husband managed.

Mom then asked what the kids would live on if the business was closed, since both of their parents worked there, as well.

...

That gal didn't bug mom much after that.

j. christian said...

When I was in college I spent a summer in Indonesia. Because I was living with the family of a close friend, I got to see a side of the country that most tourists don't. This was around the time that the spotlight was shining brightly on Asian sweatshops. I visited one factory and passed by several others on occasion.

My impression of the industrial factory that I visited was that the conditions weren't much different than a manufacturing facility you'd find in the U.S. The workers looked healthy, and there were plenty of signs that safety precautions were being closely followed. Of course, I might've visited the one good factory in the whole country, but they weren't making a show for my benefit (being as I was just a college student).

There were other factories that looked pretty grim from the outside. I particularly remember my friends pointing out the "barracks" where workers lived. By American standards, they looked like bad apartment buildings in a typical city. But by Indonesian standards, they looked a lot better than some of the corrugated tin shanties I saw in Jakarta. And to be honest, there were some retail buildings that looked like terrifying fire hazards in comparison.

Political problems aside, there was a real sense of hope in economic progress there. Factory jobs were pretty good compared to some of the alternative occupations. (If you don't believe me, see if you can find something on the web about the notorious banci who work the night in Jakarta.) What you didn't get was the sense that workers were being exploited and the country would be better off without all the exports and trade. Trade had clearly made a difference for the better in the lives of most Indonesians.

Darwin said...

J. Christian,

One of my co-workers who's from Sri Lanka made the same comment about visiting garment factories there. Having been in the US for a while, he was expecting some kind of sweat shop. What he saw was an amazingly clean, high tech facility.

Not to deny that there are indeed sweat shops out there, but at the same time, sometimes the alternatives to sweatshops are worse.



Along similar lines: One of the things that my Indian co-workers are truly shocked by are lay-offs. For all that many people in India make very little by US standards, they tell me that although employees often trade up jobs every 6-12 months, it's absolutely unheard of for a company to let employees go for anything other than extreme wrong doing. Things are growing fast enough over there, I guess, that there is more demand for skilled workers than there is supply. That would tend to suggest to me that any inequalities in pay ought to take care of themselves pretty quickly.

TaniaRocha said...

This actually depends. When I was a child, I lived in an area where there was a lot of illegal child-work (in a developed European country!). And I know that while some factories did treat these poor people (including children, around 12-14 years old, mostly) with safety and low, but still reasonable, salaries, in some places there was no safety or health precautions (thread-making factories where nobody wore facemasks and employees ended up with chronic asthma and breathing problems because they would breathe cotton/acrylic fibres every day), and in other places the salaries were lower than in earlier times.

Maybe some people in my country feel bad about buying from those countries where the salaries are really low, because they feel that the poorer people in my country are being forced to work at lower salaries than a decade ago (while the cost of living keeps going higher and higher) in order to compete with pieces made in those countries, and are actually living worse off than a decade ago.

Cliff said...

How about buying from China? Do we want to support the workers? Or, is our money supporting the communist regime?

Anonymous said...

The Blackadder Says:

Another excellent post.

Katherine said...

Wage rates are only a small part of the issue. Are workers given a safe working environment? What about exposure to chemicals that cause miscarriages? Are workers given the right of association? Are run-away shops set up that will simply run away to somewhere else as the first signs of local development appear? Are factories employing children, taking them out of school?