I captioned a photo of the graves for the 112 Bangladeshi workers slaughtered by fire in a garment factory that was locked from the outside, and that picture has been shared a couple of times. I’m including it (with caption) in this article to drive home the point that 112 individual people lost their lives in a locked-down clothes factory in 2012, despite all the health and safety advancements the world has made, despite the labor laws and regulations in developed countries, so we can think about the real cost of cheap, outsourced goods.
Outsourcing has been a topic of this blog before (and no doubt will be again), but this particularly visible incident really shines a light on what is happening to drive down the cost of goods to U.S. consumers. We can’t fathom making a dollar a day, or working eighty hours a week in a 110 degree factory, or sending our ten year old kids to the factory to make a living. These things don’t mean anything to the average American consumer because, as bad as they are, these conditions can’t be fathomed by the population of such an insulated population, of a people that see 7.25 an hour as the legit minimum wage despite the reality elsewhere.
Now, though, we have this. We have 112 empty graves to be filled with the mothers, fathers, sons and daughters of Bangladeshi families who just wanted to get by, who worked in a building where, according to the owner, “nobody told me that there was no emergency exit.” Despite the 300 Bangladeshi garment makers killed in similar fires over the last six years, it has never been so visible to Americans, and that’s good for us because we truly need to see the reality of outsourcing and lax workplace safety regulations.
Of course, as Americans, we need someone to blame for all this, and the pundits (as well as my Facebook friends) have been quick to find their go-to scapegoat for all of society’s ills: The working class consumers who “demand” cheap products, of course!
Here’s how it goes in the eyes of the Objectivists and “free market” types:
The poor corporations just handed out their last round of tiny million dollar executive bonuses to reward their back-breaking hard work from the pittance that was left after paying exorbitant wages of eight, sometimes nine dollars an hour to their lazy, uneducated, worthless workers. They realize that, at this rate, their goals of owning a house on every continent and a Rolls Royce for every day of the week are in serious jeopardy because the greedy, heartless consumers simply won’t pay fifteen dollars for a t-shirt.
After wiping their tears with $100 bills, they make a big sacrifice… because the consumers demand it, they shut down factories full of American workers and move production to a third party in Asia. They don’t want to, of course, but how else do the consumers expect them to scrape by on a razor-thin 70% profit margin? These factories can churn out 80% more shirts per day at less than half the cost, so the consumer wins!
OK, now here’s what really happens:
A consumer cashes their six hundred dollar paycheck, printed from the same press that gave their CEO his latest multi-million dollar bonus, pays rent for their studio apartment, grabs a few groceries, and realizes they need a new t-shirt because the last one is covered in stains from the oil change they performed on their car last week. They have five bucks, so it’s gonna have to be a cheap one… time to head to Walmart.
Wages have been all but stagnant since 1980 while executive pay has consistently grown at alarming rates… but when the working class consumer is forced to buy the cheaper, outsourced product, we try to blame them for “demanding” it. I’ve never met anyone who prefers to buy the cheap Chinese t-shirt over the union-made, long-lasting, stain-resistant American-made version, but we buy what we can afford, and as long as executives continue keeping more and more for themselves while busting unions, holding down worker pay, and choosing to outsource as another means of helping their bottom line, it will be a neverending vicious cycle.
You want to stop outsourcing? Don’t blame consumers. End NAFTA and CAFTA and introduce tariffs on ALL consumer goods. Make it painful to outsource. Tax the hell out of the top margins of income and use it to subsidize public works and new private co-ops. Invest in our working class. It worked with the New Deal and it will work today.
However, as long as we blame the underpaid for not spending enough of the money they don’t have, we’re fighting a losing battle.