AMERICAN
RETAILERS HAVE A RESPONSIBILITY
FINDING THE
BALANCE IN A GLOBAL ECONOMY
Survivor of a
building collapse Reshma Begum receives treatment at a hospital in Savar, near
Dhaka, Bangladesh, Saturday, May 11, 2013. The seamstress who survived 17 days
before being rescued from a collapsed garment factory building was exhausted,
panicked and dehydrated as she recovered in a Bangladeshi hospital Saturday,
but she was generally in good shape, according to her doctors. (AP Photo/A.M.
Ahad)
(Friday May 17, 52nd
& Lexington Ave., Manhattan, NYC) There is likely not an American reading
these words today who does not have some piece of clothing, some garment or
other that was manufactured in Bangladesh.
Second only to China in providing ‘ready-made goods’ to western and particularly
the American market, one fifths’ of this profoundly impoverished country’s
economy is generated by the manufacture and export of clothing destined
for export. From coast to coast discount retailers such
as Walmart to high end labels that adorn the racks in stores such as Bergdorf
Goodman and Neiman Marcus not far from here in Midtown Manhattan, to brands
including Gap, Benetton and Calvin Klein, have been produced by cheap labor in
abhorrent working conditions half a world distant from here.
For better or worse America
today is a huge importer of a mind-bogglingly wide array of goods from foods
and clothing, to automobiles and electronics.
There was a time the might of America’s manufacturing base had the
United States firmly in the driver’s seat of the rapidly growing global
economy. As the business climate changed
and circumstances such as increased regulations, labor costs, and the general
expenses of doing business here became onerous to many CEO’s and captains of
industry, more and more companies began to take their operations overseas. After all, in our homegrown brand of
Capitalism, the bottom line, stock dividends, and huge corporate profits became
the Holy Grail. They were the benchmarks
that analysts, investors, bankers and Wall Street managers pored over in search
of more clever ways of increasing those benchmarks. It was and remains a largely self-propelling
feedback loop that began to erode American industry and manufacturing. After all, why pay for the costs of labor,
regulations, employee benefits and the rest if a vast sea of cheap labor in
under or unregulated countries sat idle yet eager to work for a wage that would
appall American’s?
The actual causation of the
decline and ultimate diminishment of American manufacturing is difficult to
identify and subject to contentious, often bitterly partisan argument. Complex forces in isolated instances began
what would soon be a mass evacuation. As
our businesses moved their operations off shore the once solid dominos of our
industrial economy began to fall. And
once they began falling, they never stopped.
In little more than two decades went from being one of the world’s largest
exporters to one of the largest importers.
Most disturbing was that in specific industrial and manufacturing
endeavors that once were a huge source of exports for America such as steel,
electronics, digital media and even grain such as soy and corn, we found
ourselves in a position of having to now import those very same goods. One could argue the arcane details of free
trade agreements, tariffs and taxes, and would likely have no broader or better
understanding of the etiology of our industrial decline than does the average
worker who lost her job to “down-sizing” or an employee whose employer who saw “outsourcing”
as a cost cutting, revenue generating gravy train.
For the most part the American
consumer seems to give little thought to the points of origin for the products
that line the shelves and fill the racks of merchants from grocers to the big
box discount outlets. From sportswear to
footwear, from accessories to the basics, the overwhelming majority of the
consumer goods available to us originate in some of the poorest countries on
the face of the Earth. It is only when
catastrophe strikes such as it did last month in Bangladesh that some attention
is focused on the disparities inherent in the global supply chain in which we
consume far more per capita than we produce.
INEQUITIES ABOUND
Besha Regum and the hundreds of her coworkers who
were in the factory that collapsed last month claiming over 1,100 lives worked
for a wage that is equal to the price an American pays for one Izod or Calvin
Klein shirt. Yes, everything is relative
however the inequities in the sprawling global supply chain are so stark that
the arguments that support having our goods manufactured overseas ring hollow
in reality. The harsh fact of the matter
is that the American consumer exists at a distance so far removed economically
from those who produce the goods we purchase that it is difficult to rationalize
the disparity away. The common
justification touted by those with vested interests is that the wages paid to
these laborers in “third world countries” or, perhaps even more insulting,
“developing nations”, is far greater than the median income of their
peers. Using the bleak economic data
such as per capita income of countries like Bangladesh does not excuse or explain
away what is in reality systemic exploitation.
This interconnected sinuously
intertwined global economy is a double edged sword that knows no mercy. For
those at the top it cuts a prime sirloin of ever increasing wealth while for
those at the bottom it slices out a hardscrabble sustenance living. Prominent among the fallacies that the
proponents of outsourcing vociferously assert is the specious and failed
economic theory that defined the Reagan Era in American politics. To believe that “A rising (economic) tide
lifts all boats” is akin to asserting that shipping American jobs overseas is
good for our domestic economy. Both are
patently false claims.
FINDING BALANCE IN AN UNBALANCED WORLD
As is the case in so many of
the thornier issues facing our government and others nations as well is that
the “Law of Unintended Consequences” is a potent current undermining the
piecemeal efforts to allow developing nations to gain entry in the exclusive
club they so desperately seek to join – the “developed” nations sometimes
simply referred to as “The West.”
America was permitted to grow unfettered by rules and regulations that
have since become the dominant forces that impacted our manufacturing/industrial
base. Our “Industrial Revolution”
predated virtually all labor laws and workplace safety regulation that are so prominent
and often roundly derided by CEO’s. Human rights groups, environmental
activists, and a host of other advocates endeavor to export our particular brand
of regulation and protections into countries that produce American
products. As noble an effort as this may
be it is not only unrealistic, it seeks to impose a level of structure and
rigor to overseas workplaces that is simply not feasible.
The highly
regulated American workplace comes with a price to consumers.
Are American’s
willing to pay more for goods that come from overseas?
THE GRINDING ECONOMICS OF POVERTY
People the world over possess
common aspirations. Those aspirations
have a far better chance of being realized depending, sadly, on one’s
birthplace. Parents love their children
and want nothing more than to protect and nurture them and hopefully provide
whatever they can so their children have a better life than their own. America has been a work-in-progress, a grand experiment
in republican Democracy, Laissez faire economics,
open markets, individual freedoms, and our brilliant and inspired
Constitutional rule of law. But we are a
young country; infants in the world community who was blessed to be born on a
largely pristine part of the North American continent that afforded us the
opportunity for unrestrained growth. Our
two oceanic borders have kept us physically isolated from much of the turmoil
that has engulfed various parts of the world since our inception. Our polyglot nation of immigrants had the privilege
to develop, expand, and thrive; a unique trifecta of circumstances unrivaled
since the empires of the colonial days.
For the United States to ask other countries to “put the brakes” on
their own burgeoning economic engines is unreasonable and, to a degree
hubristic.
All that can be done is to
exert our influence in the multinational forums that exist for the exchange of
ideas, the United Nations, and to engage with our trading partners in their
efforts to find the balance between industrialization and individual liberties
while combatting endemic corruption and antiquated ideas. To be responsible members of the Global Community
America has certain obligations that are obviously, easier said than done. However, we must export more than our jobs
and cultural media and cannot continue to import goods that are produced in
ways that are unacceptable on our shores.
This is the challenge before governments today and it is, let’s be
explicitly clear, no easy task. It is a
task fraught with Gordian Knots of issues ranging from taxes and tariffs, to
worker safety and health.
Despite the seeming insurmountability
of this challenge it must be taken up and taken up in earnest. There is a wider world that we Americans seem
blissfully unaware of until some catastrophe or disaster strikes half a world
away and makes our headlines. But, in
spite of our own blissful ignorance and parochialism, most Americans admit that
labor conditions and workers’ rights of those in far off places such as
Bangladesh have “the right” to most of the same protections and oversight that
serve to protect them here in their own jobs.
Actually, in a Gallop Poll taken last Summer a good majority of
Americans, 63% said they would be willing to pay a bit more for their clothing
that is manufactured overseas in often deplorable conditions with child
labor. That is a start. And, the key
towards identifying and implementing solutions takes nothing more than the
desire to enact change.
TAGS: BANGLADESH
FACTORY COLLAPSE, BAGLADESH TEXTILE INDUSTRY, AMERICAN RETAILERS MERCHANDISE
PRODUCED IN OVERSEAS “SWEAT SHOPS”, THE COST OF CONSUMER GOODS, THE GLOBAL
ECONOMY,
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