A discussion of Steve Job’s tenure as Apple CEO and workers’ conditions at Apple supplier Foxconn prompted an Andrew Sullivan reader to highlight a 1997 Paul Krugman piece in Slate, In Praise of Cheap Labor. The Sullivan commenter accurately summarizes, “what OECD residents perceive as gross maltreatment of workers ($4/day wages, long hours, poor work conditions) is actually raising living standards in these places, compared to subsistence farming.” Indeed, Krugman argues that given the alternatives of rural poverty or life as a cheap laborer, life as a laborer is better.
Krugman explains, cheap labor is only the first rung on the ladder of an export-led growth strategy, opening opportunities for broader economic advancement throughout society. Look at South Korea and Taiwan, Krugman urges us, they have met success traveling down this path. Of course Krugman is not the only one making this argument about awful working conditions being a steppingstone to future prosperity. Using similar arguments his fellow New York Times columnist Nicholas Kristof has repeatedly praised sweatshops and co-authored a book that opens with similar arguments (Thunder from the East: portrait of a rising Asia). Krugman closes by saying it is our moral duty to think things through. Let’s.
One paragraph stood out in the Krugman piece, particularly given the closing reference to our moral duty:
That “inevitably” deserves a great deal more scrutiny.Workers in those shirt and sneaker factories are, inevitably, paid very little and expected to endure terrible working conditions. I say “inevitably” because their employers are not in business for their (or their workers’) health; they pay as little as possible, and that minimum is determined by the other opportunities available to workers.
Leaving aside the false choice of sweatshops equal development while no sweatshops equal no development, the rather forgiving attitude expressed towards employers who abuse their workers should disturb us all. Profit at the expense of workers’ health is profit at quite a high cost. Isn’t profiteering at the expense of the well-being of others price gouging?
The fact that the alternatives for workers present such dire hazards should make us even more sensitive to their vulnerability to exploitation by factory owners. The consequent use of factory owners’ superior bargaining position at the expense of their workers’ welfare is certainly not a cause for celebration. Structures that (re)produce this relationship do not deserve our praise.
Instead of celebrating the sweatshops, we should be focusing on the “Guiding Principles on Business and Human Rights” (pdf). I’m aware that the Guiding Principles expressed as such did not exist in 1997, but Krugman’s interlocutors were expressing the underlying values of one of the principles, the corporate responsibility to respect human rights.
Briefly, the Guiding Principles were developed under the leadership of John Ruggie as a UN Special Representative on the issue; they are the result of six years (2005-2011) of research and consultations. They propose a three part framework: Protect, Respect, and Remedy.
There is a sentence from the Guiding Principles whose meaning should resonate with anyone analyzing sweatshops, “the corporate responsibility to respect because it is the basic expectation society has of business in relation to human rights;”. Krugman and company have set their basic expectations of corporate conduct far too low.the State duty to protect against human rights abuses by third parties, including business enterprises, through appropriate policies, regulation, and adjudication.
the corporate responsibility to respect human rights, which means that business enterprises should act with due diligence to avoid infringing on the rights of others and to address adverse impacts with which they are involved.
the need for greater access by victims to effective remedy, both judicial and non-judicial.
[pdf link above]
It is our moral duty to expect more.
(The UN Human Rights Council endorsed the Guiding Principles in June this year.)
Nice post. Nice blog.
[…] James K raised in the other discussion thread, In Praise of Cheap Labor. I’d found the piece wanting, writing, The fact that the alternatives for workers present such dire hazards should make us even […]