Cheap Labor at any price?

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Cheap Labor at any price?
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Introduction

• Globalization is what happens when you lose your
  job in () Elizabeth because the company for
  which you work has been bought by the Australian
  subsidiary of a Dallas-based transnational
  company that has decided to relocate its
  production of T-shirts to Mexico because of
  cheaper wage costs and lower health and safety
  standards () tax breaks, freedom from
  environmental laws.
• J. Wiseman, Global Nation? Cambridge university
  Press, 1998.

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Against (The Corporation 2004)
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Pro (The Corporation, 2004)
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Text

• Globalization Survey Reveals U.S. Corporations
  Prefer Dictatorships
• American businesses may say they believe in
  democracy, but they are not putting their money
  where their mouth is, according to a report by a
  Washington-based think tank.
•  
• Democratic countries in the developing sector,
  such as Poland and South Africa, are losing out
  in the race for American export markets and
  American foreign investment. Dictatorships such
  as China or semi dictatorships such as Indonesia
  are winning. And the trend is growing. As more
  of the world's countries adopt democracy, more
  American businesses appear to prefer
  dictatorships.
•  
• Such rulers in dictatorships tend to be strong
  leaders who can provide quick decisions, deliver
  results and stamp out opposition. These qualities
  can appeal to many business leaders, who
  themselves operate in a non-democratic structure.
  (..)
•  
• Dictators, not having to answer to voters or a
  legislature, can often deliver investment
  incentives (2)-such as tax breaks, freedom from
  environmental laws and a docile work force--that
  are powerful lures (3) for foreign corporations.
•   
• November 19, 1999

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Conclusion
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Evaluation
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Text

• REEBOK, NIKE, AND LEVI STRAUSS ON THE PROWL FOR
  CHEAP LABOR IN INDONESIA by Peter S. Goodman
• Tini Heyun Alwi is not sure exactly how much a
  shopper in America must spend for a pair of the
  Reebok sneakers she and her co-workers assemble
  each day by the tens of thousands, but she
  figures it's a lot.
• "I think maybe I could work for a month and still
  not be able to buy one pair," says Tini, who
  works on the assembly line of the Dong Joe shoe
  factory at an industrial estate in Tangerang,
  just outside Jakarta, Indonesia's teeming
  capital. A look of wonder crosses her
  nineteen-year-old-face at the strangeness of the
  thought as she sits cross-legged on the floor of
  the squalid one-room shack that is her home.
• The room is no larger than many a closet in the
  West, but Tini shares it with another woman to
  keep costs down. Neither owns a mattress or a
  bed, so they sleep on the floor. The moist
  tropical air is disintegrating the walls, just
  bundles of newspapers fastened together with glue
  and string. Mosquitoes enter at will, floating
  like confetti around a dim light bulb hanging
  bare from the plywood ceiling.
• One month's worth of Tini's earnings actually
  falls far short of the retail price abroad for a
  pair of the trendy, leather athletic shoes she
  stitches together. Six days a week, Tini works a
  ten-hour shift inside a poorly ventilated factory
  in stifling heat, each day earning the princely
  sum of 2,600 Indonesian rupiah (1.28). Throw in
  forced overtime two to three times a week at
  another 300 rupiah (fifteen cents) per hour and
  Tini's monthly wage comes to about 39, a far cry
  from the 110 that a single pair of Reeboks can
  command in the United States.
• This is the arithmetic behind Southeast Asia's
  economic boom, and Indonesia has learned the
  equation particularly well. Lured by cheap,
  abundant labor, investment capital has poured
  into the archipelago--more than 18 billion over
  the last three years alone-- much of it into
  shoes, textiles, garments, and other
  export-oriented manufacturing sectors. Such major
  American brand names as Reebok, Nike, and Levi
  Strauss--always on the prowl for cheaper labor
  markets free of unions and safety codes--have
  descended on Indonesia.
• The corporations prefer not to do their own
  manufacturing they stick to advertising,
  distribution, and product development, while
  contracting with Third World factories to churn
  out their products at rock-bottom cost.