Even in our modern world, sweatshops remain a horrifying reality, with hundreds of thousands of the world’s poor and defenseless people exploited by wealthy factory owners and greedy supervisors. Their jobs, perhaps better termed slavery, involve back-breaking hours in pitiful conditions, sometimes using toxic chemicals without adequate ventilation or protective gloves or goggles, for pennies per day. Stories of children stitching fancy beadwork by candlelight at midnight, female workers forced to provide sexual favors to keep their jobs and workers refusing to drink fluids in sweltering heat to prevent the necessity of bathroom breaks are all too common and all too true.
So, how could there be a good side to this? And why would any self-respecting industrialized nation purchase products made in such a fashion? The instinctive, gut-level reaction is to boycott these goods; is that wrong?
In a word, yes.
On average, the employees of sweatshops work there because they have no better alternative. Children work in such conditions, not instead of going to school but because they have no school to attend or no means to support themselves if they do. Parents work there because the alternative is watching their children drop out of school and work themselves or starve.
Better Than the Alternatives?
It’s a painful fact that boycotting goods made by sweatshop labor only hurts the workers, not the factory owners. In 1993, a U.S. boycott forced Bangladeshi factories to quit utilizing child labor. According to Oxfam, most of those displaced children were forced into worse positions, including prostitution—when their first choice had been to sew clothing for Wal-Mart shoppers.
Being without better alternatives, the people who have sweatshop jobs are often glad to have them and see them as a positive beginning for a better life. Nicholas D. Kristof and Sheryl WuDunn, who won the Pulitzer Prize in 1991 for their coverage of China’s Tiananmen Square massacre, recounted multiple stories of Chinese sweatshop workers who were puzzled when Western journalists bemoaned their twelve-hour plus workdays, seven days per week. More than one young woman they interviewed said how great it was that the factory allowed them to work such long hours, and others commented they had taken that job deliberately over others in the area to earn more hourly pay.
Since that interview in 1987, more companies invested in the area and additional factories opened across southern China. Although this workers’ state could still use a few stout labor unions, workers are now more mobile, wages have more than quintupled and conditions have improved as factories compete for the best workers. More people now work for private industry than for the state (although it’s also true that unemployment has risen as a result). Although the yuan’s exchange rate is still controlled by the government, its purchasing power has risen to approximately one-sixteenth that of the U.S. dollar. The rivers of bicycles once common in Chinese cities are being replaced by cars and even SUVs, with gasoline subsidized by the government.
Allowing Developing Countries to Develop
According to an article by Michael Strong in 2006, roughly 1.2 million people rise above poverty in China every month by moving to an urban area and taking a job that pays less than US$2 per day. He claims that Wal-Mart, through allowing developing economies access to industrialized markets, has helped more of the world’s desperately poor than the World Bank and relates the story of a Mongolian student who, when he heard U.S. college students ripping into sweatshops, shouted out, “Please, give us your sweatshops!”
Strong also points out, quite correctly, that a line must be drawn between criminal exploitation and market economics. Workers deserve decent wages and working conditions that won’t kill them, not only in developed nations but also in the backwoods of beyond. But to achieve that requires not fewer sweatshops but more of them, clustered together to create competition for workers in the Chinese pattern.
If China continues growing at its current rate, in 2031 it will reach a standard of living comparable to that in the U.S. It’s the same path taken by Japan in the 1950s and 1960s and the Asian tigers in the 1970s and 1980s.
It’s an ugly path, dirty and brutal. But it’s proven to work. Can the same be said for other forms of foreign aid?
In early June, worried about the rapid increase in the cost of oil, I called my home heating oil provider here in Michigan and ordered a delivery to fill our tank, which is currently almost on empty. The price to fill the tank at that date was just shy of $1100, and last winter we needed to fill it four times. The house we live in is about 1000 square feet and well-insulated, and we’ve added extra insulation and stopped using hot water. Last winter cost us about $2300 to get through: This winter will easily be double that, if not worse, barring a miracle.
We don’t have a gas line to our house, and even if we could afford to install one this year, we would also have to replace the furnace, so my thought was, better to start out with a full tank of heating oil at the outrageous June price than an empty tank in November when the temperature starts to plummet and prices might be anything at all.
Three weeks later, no oil delivery. I called our company and was asked if I needed the oil to heat water. I said, “What does that have to do with it?” The woman on the other end of the line said they rarely deliver oil in the summer unless it’s truly needed, which I know is untrue: Usually oil companies like it if you order in summer because it’s one less winter delivery they need to make when everyone and their brother is calling after the first snowfall. Often you even get a discount for summer delivery.
I said, please, deliver it. We’re nervous. Fill our tank. We have payment in full.
Another month went by, no oil. I called again. They said no trucks had been out our way. (We live in a city of under 100,000 people.) I said, well, when might trucks be out this way? She didn’t know. A couple weeks maybe?
Now it’s three weeks later and still no oil, and tonight on CBS news I learned that because of the credit crunch, many small home fuel oil delivery companies are unable to obtain credit to buy the oil their customers need. Some customers on the east coast have paid as much as $5000 in advance for winter heating oil, only to find out the company has gone belly up, their money is gone, and they still don’t have oil. Basically, they will have to pay for it twice because you can’t get through winter in New England without some way to heat your home, but can you imagine, in this economy, having to come up with 10K on the spur of the moment just to make sure your pipes don’t freeze this winter?
So now, I have to start calling oil companies in our locale and find one that actually has oil that they will actually deliver to our home. It’s sailing into mid-August now, and in another six weeks it will no longer be a topic for an economics blog; it will be time to get out mittens, long underwear, and start burning furniture in a hot-wired wood burner.
Over the not-very-long run, we will have to find a different way to heat our house. Sooner would be better than later. But for the short term, we need oil, and at least one of us is getting scared. I’m not writing this to cause a panic. Panic never solves anything. I just thought some of our readers might like a heads up. I know I certainly would have liked one in June, as in the truth straight out, instead of waiting to see it on the Nightly News from Katie Couric, who is not exactly my best friend.
I’m a Brian Williams kind of girl myself.
To read the complete article at the CBS New website about the coming home heating oil crisis, you can go to Home Heating Oil Hell at the CBS website.
Then, without making to much of a fuss or freaking out overly, you might want to get on the phone and keep calling oil companies until you find one who will deliver some heating oil to your home, now. Today.
That’s what I’m going to do. I’ll let you know how it turns out in a future post, along with our best and worst ideas for what to do to change this next year.
In most professions you get paid the more senior you become. An attorney typically bills hourly and as he becomes more an expert in his field and within his firm, his hourly rate continues to increase. Similarly in business, as you climb the corporate ladder, your salary increases. Medical doctors have an unusual situation. Once you become a doctor, you get paid per office visit, per consultation, per procedure, or per surgery the same as whether you have been doing it for 30 years.
The main reason that physician pay does not increase according to seniority is because the payer is usually Medicare or an insurance company that pegs their reimbursement to Medicare rates. When your payer is the government, they don’t care whether you are the best in the field or you have been doing it for 20 years. They don’t care whether you take 1 hour or 10 hours to do the surgery or see the patient. The pay is still the same. Thus in many ways, medicine is sort of an “all you can eat” type of service. You only get paid once, but you must provide complete service.
While the pay increase from resident to attending physician is a typically a huge jump, doctors hit a ceiling early on after they become fully fledged physicians. One reason for this equality in pay among doctors of all levels is that when dealing with human life, it is expected that all doctors provide the best possible care. Differentiating one physician from another or one surgeon from another is very difficult. Additionally, seniority does not necessarily mean that the product or service is better.
Although the pay per service does not increase the more senior you become, in reality the more senior you become the faster you typically perform a service. Thus in some sense pay does increase but this is due to the physician working faster and more efficiently. In practice this is not necessarily always a good thing because some physicians tend to rush or hurry through their patients or procedures. Sometimes this results in poor care or mistakes.
For the physicians who operate non-PAR or take cash payments such as plastic surgeons or dermatologists, they may be able to charge more given their experience or reputation. However, the competitive landscape in any city usually caps levels to cater to what is reasonable for individuals.