Sweatshops Are A Good Thing?

I’m uncomfortable with the arguments made in the below video, but I can’t think of any holes in them. And the calm rationality on display seems to invite complacency. But I was already complacent.

About Santi Tafarella

I teach writing and literature at Antelope Valley College in California.
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5 Responses to Sweatshops Are A Good Thing?

  1. andrewclunn says:

    I am interested in the counter argument if there is one.

  2. Cody says:

    I’ve seen a lot of the videos from the Learn Liberty channel and they’re very interesting. The only potential counter-argument I can think of to this video’s argument at the moment would be from a utilitarian point of view. Consider the capitalist who, seeking a better profit margin, takes his business overseas where we will not be burdened by pesky environmental, minimum-wage, or even human rights laws. Sure, a person vastly poorer than a working-class American gets to earn $2/hour, but how does her earnings better the lives of that individual compared to the same job held by a blue-collar American worker? The reason capitalists go overseas is simple – to make more money by investing less in the manufacture of a particular commodity. Their decreased spending likely results in less money floating around in a given economy than if they were practicing their business in the U.S. For example, jobs would be created by the money funneled into environmental, state, and federal taxes and other spending on the part of the capitalist. Of course, the argument can be made that a capitalist who gains a higher profit will turn around and create jobs via investment, but I don’t know if the overall benefit of those investments would be equal or greater than the overall benefit created by running a business by American law.

    This isn’t the strongest argument, but I think it’s a potential answer to the argument in the video. A lot of the videos from Learn Liberty boil things down to their most basic level, which can be very deceiving. The world is far more complex and contains many more variable than those presented in their videos.

  3. Adam says:

    I\’d argue the best refutation of this argument lies in the fact that it ignores social and economic externalities and only focuses on profit as a whole. The externalities omitted in arguments for sweatshop labor are factors such as increasing inequality growth due to outsourcing of jobs. As inequality increases in an economy the consumer becomes increasingly unable to purchase the goods being produced by the sweatshop labor due to the fact that well-paying manufacturing jobs have been lost.

    This creates a gap in supply and demand and results in wasteful practices emerging. The consumer becomes unable to purchase goods at higher prices so supply cannot fix the inequality by increasing the price while lowering the demand and likewise consumer demand cannot rise due to their loss of income. This is the real issue with sweatshop labor. It continues to drive a widening supply and demand gap to inequality.

    In the countries that receive the sweatshop labor local managers benefit more then the people in the long run and this creates a similar system to the one that existed in the United States in the first place that drove the outsourcing. As this nation industrializes they too will encounter supply and demand gaps if they do not develop strong worker\’s unions (Which they won\’t, modern free marketeers won\’t allow it)

    Interestingly, sweatshops will likely see a decline over the next few years as the price of labor increases in these places that have largely been massive sources of outsourced employment. The outcome will be either new sweatshops established elsewhere or manufacturing coming back home. Even if manufacturing comes back home the wages paid by these industries will still be low since worker\’s unions are pretty much dead.

  4. J. A. Le Fevre says:

    Protests in the West have closed sweat shops in 3rd world economies – and Wetern branded products have switched to less abusive factories. Slow progress, but progress.

  5. Eric says:

    This video misses the mark in many ways.

    One obvious point that the video misses is the complicity of western government in the abuse of workers. Workers in the Western world used to have terrible conditions too, they even had kids working in their factories. That got a lot better over time, thanks to unions, activists, etc.. and now “we” here in Canada have labour laws, minimum wages and so on (Thinks aren’t all hunky-dory over in the West either… just ask a wallmart/Mcdonalds employee, or even overworked white-collar workers; the game industry is infamous for getting people to work overtime…without pay). Now instead of having sweatshops here, we just have them elsewhere instead. Western governments will go so far as to use military force in order to prevent these workers from getting any rights. Just to take an example, the 2003 Canada-backed coup of Jean-Bertrand Aristide in Haiti. He was raising (or establishing) minimum wages in Haiti, and it just so happened that the minister of defense here at the time had connections to manufacturing companies that did business in Haiti[1]. He publicly backed the coup, and Canadian commandos were sent in to secure the Airstrip where Aristide was flown out of Haiti to live in Exile. The OAS (organization of American states) was very supportive of the brutal Latortue government that took over. This is not an isolated incident! Things like this happen all the time. To know more I would suggest reading: Confessions of an Economic Hitman, “The Shock Doctrine”, and to google information about the attempted coup of Hugo Chavez, the US’s history in South America, the IMF and the world bank’s roles in impoverishing countries, and/or whatever else you can get your hands on.

    The video talks as if the only result of worker’s rights activists in the US is the closing down of factories over-seas. That is not the case. Just look at how Foxconn has improved the conditions in its factories, as a result of Apple pressuring them to. Apple did this because activists in the U.S. held protests in front of their stores, wrote letters, etc..

    Mark & Spencer buys its clothes from factories in poor countries, but it has a policy of only using sources that conform to their standards (no more than 40 hours a week, no child labour, good safety, etc..). How well this policy works out in practice all the time is in question[2], but the point is that there are things that can be done to improve the conditions of workers in the world, and frankly, I don’t know how you can look at all the factory fires, the sexual abuse, physical abuse, intimidation, and injuries without compensation and think that there’s nothing that should/can be done about it. This video is meant to lull people into complacency.

    1. http://www.sevenoaksmag.com/features/98_feat2.html
    2. http://www.theguardian.com/world/2010/aug/08/gap-next-marks-spencer-sweatshops

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