Term Paper on "International Sweatshops"

Term Paper 6 pages (1847 words) Sources: 2 Style: APA

[EXCERPT] . . . .

Business ethics [...] issue of international sweatshops, particularly in China. It will also look at how to control or eliminate these sweatshops. International sweatshops exist all over the world, and some of the largest and most well-known American manufacturers, such as Nike and Reebok, exploit workers in these foreign sweatshops. Are sweatshops appropriate, and what are the appropriate wages for international workers? These are difficult questions, but corporations much answer them, and set boundaries for their workers, both in America and overseas, to protect their image and reputation, while protecting their workers, as well. Corporations must use market wage standards for their international employees, and they must create good working environments.

It is difficult to believe that sweatshops still exist in the 21st century, but unfortunately, they are common all over the world - even right here in America. American and foreign industries exploit foreign workers at an alarming rate. Many companies, such as Apple and Nike, have been accused of exploiting international workers. Two writers notes, "Organizations such as Human Rights Watch, United Students Against Sweatshops, [and] the National Labor Coalition [...] have accused multinational enterprises such as Nike, Wal-Mart, and Disney, of pernicious exploitation of workers" (Arnold and Bowie, DATE, p. 591). However, one of the problems with regulating international sweatshops is the lack of guidelines regarding these manufacturers, and lack of foreign legislation that covers these industries. Authors Arnold and Bowie go on to note, "Unlike the recent immigrants who toil in the illegal sweatshops of North American and Europe, workers in developing nations typically have no recourse to the law or social service agencies" (Arnold and Bowie, DATE, p. 591). This is especially true in many Asian countries - especially China.

The working conditions in many of these sweatshops defy the imagination and are extremely demeaning to the workers and distressing to those who read about them. For example, two authors write, "[a]t a shoe factor in Guangdong, China, it is reported that 2700 workers were prevented from leaving the factory by 100 live-in security guards that patrolled the walled factory grounds" (Arnold and Bowie, DATE, p. 596). China is the largest exporter of apparel in the world (Rivoli, DATE, p. 543), and it is one of the most oppressive regimes in the world, often breaking strikes and suppressing unions while offering no wage and safety laws to protect Chinese workers. Thus, companies who utilize Chinese sweatshops are supporting the regime and repressing the workers even more than in many other countries. For example, Nike and several other companies moved their operations to China when other countries allowed the proliferation of unions.

In China, the government suppresses any union activity, thereby ensuring these companies of workers who will make no demands of their employers (Maitland, DATE, p. 584). These companies are not only supporting poor working conditions for their workers and families, they are contributing to the economy of a government that suppresses and represses its people. However, Chinese workers are not the only workers who have to endure terrible conditions. Authors Arnold and Bowie continue about shops in El Salvador, "In the majority of companies, it is an obligation of the personnel to work overtime under the threat of firing or some other kind of reprisal" (Arnold and Bowie, DATE, 597). In Mexico, a 26-year-old worker notes, "I start out the shift okay, but after about three hours of work, I feel a lot of sharp pains in my fingers. It gets so bad that I can't hold the steering wheel correctly. But still the supervisors keep pressuring me to reach 100% of my production" (Arnold and Bowie, DATE, p. 597). Thus, workers face conditions that few American workers would stand for, but they have no rights and no recourse to change the situation.

There are critics of the major organizations bringing attention to the sweatshop situation overseas. These critics believe the organizations are going about their business of revealing sweatshop situations in the wrong way. They point fingers at the industries utilizing sweatshop labor, and have forced many to give up the practice or at least create codes of conduct to ensure better working conditions for overseas workers. One critic writes, "Major U.S. retailers have responded by adopting codes of conduct on human and labor rights in their international operations. Levi-Strauss, Nike, Sears, J.C. Penney, Wal-Mart, Home Depot, and Philips Van-Heusen now have such codes" (Maitland, DATE, p. 580). However, critics of these organizations believe the real issues is, "What are appropriate wages and labor standards in international sweatshops?" (Maitland, DATE, p. 581). No one seems to be addressing this issue, which would help clear up the sweatshop situation worldwide, and that, critics feel, is a great shortcoming in the groups that are openly criticizing companies who utilize sweatshop labor overseas. In addition, if the issue dies down in the media, there will not be global standards, and the situations for many sweatshop workers could worsen without a clearly defined answer to the appropriate wage and standards question.

If international sweatshops are going to be controlled and wages and standards set, how are these standards going to be determined? There are three schools of thought on how to establish guidelines. Author Ian Maitland maintains there are three principles that could be used to establish wage levels and standards of operation. They are "home-country standards," "living wage' standards," and "classical liberal standards" (Maitland, DATE, p. 581-582). Other economists agree these three standards should be used, but most people disagree on which standard will provide the most appropriate results.

Home-country standards would create the same wage and workforce standards for foreign workers that U.S. workers would get for similar jobs. Most people agree this standard would remove the incentive to use foreign workers, as there would not be any cost savings for the companies. In addition, economists believe paying extraordinarily high wages in local labor markets would create higher prices and help reduce the standard of living for local workers not receiving the higher U.S.-influenced wages, and thus is would harm the overall economy and living standard of the host country (Maitland, DATE, p.581). Most experts do not believe home-country standards would be effective in establishing local wages and standards.

The 'living-wage' standard would pay a living wage to local workers, based on what it takes a worker and their family to live in "reasonable dignity." This of course would vary from location to location, and many experts feel that wage is difficult to establish and maintain. Many of the anti-sweatshop organizations support this standard for creating guidelines, but economists fear it is open to too much interpretation to be extremely affective (Maitland, DATE, p.581-582). Another problem with this standard is that many corporations might hire fewer people at these wages, which would reduce employment among international workers.

Finally, the classical liberal standards are wages and standards that are freely chosen by the workers, as long as those workers are informed. However, economists feel this is not a sound method for a number of reasons. Unemployment levels must be very low for workers to make sound judgments regarding wages and safety, because in any kind of high unemployment situation, they will be more concerned with keeping their jobs than in making sound decisions about wages and safety. Unfortunately, most countries caught up the in the sweatshop whirlpools have high unemployment levels, some as high as 40%, and so, this standard is problematic for most situations. Most people believe there must be "background" forces or governmental standards to create wage and safety procedures, rather than utilizing this method (Maitland, DATE, p. 582).

How then are these standards established? All of the principles above have been found lacking in some way, so what is the right way to study and create workable standards for wages and safety for international workers? Many economists believe paying wages higher than the prevailing wages in the area is not the way to establish better standards for international workers. The case of China illustrates what can happen when wages rise in an area. Wages, especially in eastern China, have risen as more companies relocate their factories to the area. When wages get too "high," other countries compete for the work by offering factories with lower wages. It costs the American companies almost nothing to move operations, and the Chinese workers are left without jobs. Thus, if wages rise too high in an area, it may actually add to unemployment rather than create a thriving economy (Rivoli, DATE, p. 543). Therefore, standards must be set by using a fourth principle to set wages and safety regulations, and that is the market wage standard.

The market wage standard analyzes the area and the economy, and establishes wages that are acceptable to the local workers. Author Maitland continues, "The appropriate test is not whether the wage reaches some predetermined standard but whether it is freely accepted by (reasonably) informed workers. The workers themselves are in the best position to judge whether the wages [and… READ MORE

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