Mr. Obama and the Democrats who favor labor standards in trade agreements mean well, for they intend to fight back at oppressive sweatshops abroad. But while it shocks Americans to hear it, the central challenge in the poorest countries is not that sweatshops exploit too many people, but that they don’t exploit enough.
Talk to these families in the dump, and a job in a sweatshop is a cherished dream, an escalator out of poverty, the kind of gauzy if probably unrealistic ambition that parents everywhere often have for their children.
“I’d love to get a job in a factory,” said Pim Srey Rath, a 19-year-old woman scavenging for plastic. “At least that work is in the shade. Here is where it’s hot.”
via New York Times op-ed “Where sweatshops are a dream.”
Well golly, Mr. Kristof. There are so many problems with this op-ed, which takes advantage of the poorest of the Cambodian urban poor in order to encourage further exploitation of other poor Cambodians, that it is hard to know where to begin. For those who don’t know why Mr. Kristoff deserves the title of human trafficker, I’ll explain briefly at the end. For now, I’ll point out just a couple of things.
First, Kristof argues (it’s almost insinuation – it hardly qualifies as an argument) that although sweatshops are imperfect jobs, they are not a cause of poverty, but a source of wealth, and that there should be more jobs like them in Cambodia, where he implies labor standards are low – as in ‘sweatshop low.’
A number of issues emerge already: sweatshops do indeed impoverish Cambodia as a whole, though they may increase the living standards of some poor Cambodians. In a paper I just presented at an economics conference in Cambodia, I noted that 85% of garment factory workers (sweatshop workers) are rural women from poor families who remit significant portions of their meager salaries to their families in the countryside. These remissions have raised the living standards of 13% of rural households. That’s a good thing.
But the factories are almost exclusively owned by non-nationals. I’m not making a nationalist argument here – I have no truck with such arguments – but instead pointing out that when the factories are almost exclusively own by overseas Chinese (who also overwhelmingly dominate the management sector of the factories), almost none of the profits generated by the factories remain in Cambodia. Cambodian garment factories function as little more than an export processing zone, where intensive labor-value is added to raw commodities (also not purchased in Cambodia) and then sold abroad for huge profits which never return to Cambodia. The only money that stays in Cambodia are the wages of workers – currently at $56/month, and the bribes that companies must pay to those connected bastards that run the ports. This means there is no secondary industrialization which could expand the job base for people like the scavengers Kristoff writes about.
Furthermore, the factories are closing. It’s doubtful that the entire industry will close, but somewhere between 20-30 factories have closed in the past few months, with over 20,000 of the 1.25 million jobs in the industry already gone. This isn’t a ‘moral’ issue for most economists, and though Kristof is right to insist that there is a moral dimension to economics, he has it all backwards. You can’t create factories as a charity option, which is the only way his suggestion could work. Because of the lack of secondary industrialization and the consequent lack of the expansion of the job base, additional factories in Cambodia will come to exist under global capitalism only if the factory owners see profitability there. In the past, this profitability has arisen out of a situation in which Cambodia was created as a sort of token labor-rights situation in Asia. While the ILO’s laudable goals (and I am good friends with several ILO folks) are front and center as the rhetoric of this strategy, the result has been lowered import tarrifs and enormous quotas from the main global purchasers of Cambodian-made garments – the USA and Europe – both of which regions are currently beginning (not ending, not in the middle) a possibly unprecedented collapse. This fact alone makes Kristof’s op-ed irrelevant.
Finally, the fact that labor standards are significantly better in Cambodia than in Kristof’s wife’s “ancestral homeland” (am I the only one who thinks Kristoff is pushing the bounds of decency by invoking this in such a piece?) in Southern China does not come out of the ILO or its Better Factories campaign, but instead from the rank-and-file militance of two major independent unions in Cambodia that work in the industry (this excludes the independent and admirable CITA, which is the teachers’ union): the CCAWDU (Coalition of Cambodian Apparel Workers Democratic Union) and the FTUWKC (Free Trade Union of the Workers of the Kingdom of Cambodia). The FTUWKC has been at the forefront of pushing for higher wages and better conditions – they have led each major push for rising wages, from $25 to its current high of $56 a month. These were not gifts from well-meaning factory owners or highly-paid foreign consultants working for the ILO, but instead a result of the direct pressure put on the factories by the workers.
But the unions are getting demolished by a combination of government hatred (the vast majority of unions in Cambodia are either company unions or government unions, and usually literally fight for lower wages and standards and have no active rank-and-file membership). In an interview I had with Chea Mony, president of the FTUWKC, just over a week ago, he told me that somewhere between 85-90% of its membership had stopped paying regular dues. Consider what that means when the FTUWKC is not only the most militant and progressive union in the industry, but also the largest (by far).
Kristof suggests that an expansion of bad sweatshop conditions (and despite relatively better conditions, Cambodian factories are largely sweatshops) is a solution to poverty. He’s full of it. His heart might be in the right place, but he’s stopped using his reason. The factories are not doing the job that development economists expected it to do from the beginning, which was to industrialize the country and expand the off-farm job base (and therefore, reduce poverty). Today, 91% of Cambodian heads of households still list agriculture as their primary employment, and at least 80% still live in the impoverished provinces. The factories won’t expand (indeed, as I point out, they are rapidly shrinking) just because Kristof thinks that the scavengers at Stung Meanchey dump could use a better form of subsistence.
Stung Meanchey is a horror-show, no doubt about it. My argument here is not that they don’t deserve a better life, but that Kristof is using them to promote the continuation of practices that have done very little good for Cambodia’s actual economy, and that he ignores the economics of the situation, rendering his argument additionally irrelevant.
Finally, a note about Kristof as a human trafficker. In an apparent attempt to create himself as ‘Saint Nicholas’ a few years back, he bought two teenaged sex-workers from a brothel. This is illegal, no questions about it. You don’t buy people, not even from other people who own them with the intention of freeing them. Why not? Because it doesn’t work. People who study this issue have noted this for a very very long time. Kristof himself noted later that one of the two girls went straight back to her madam. To commit an act of human trafficking and to then brag about it in the pages of the New York Times is almost unbelievable to me; but we live in an unbelievable world.