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Friday, January 27, 2012



Drying up Chinese workers' income sources would be the surest route to internal revolution and overthrow of the current "Communist" regime, would it not? Shall we risk social upheaval in a nation of over a billion people with nuclear weapons at their disposal? (I'm game!)

larry kurtz

Ms. Flint: Statehood for the tribes, Mexico, Quebec, Cuba and Puerto Rico would cause the Chinese to wake up and smell the Tsingtao.

Donald Pay

I think you've set up a false choice. In fact China updated its labor laws in 2008, and, more importantly, is starting to implement them. This is one reason we're seeing some American corporations bring some jobs back home.


American labor law has been one of the major facets of American exceptionalism, and one that help build the middle class. It's one of the ideas that help bring down the Eastern bloc and it's one that many countries, not only China, would like to emulate. I'm not sure why conservatives reject the the idea that we should export our progressive labor law that made the middle class possible.


Cory: That's a good and fair point. In your view, then, the solution is to leave the situation as it is?

Mr. Kurtz: I knew I was overlooking something!

Donald Pay: Thanks for the link. I am glad to see that China is making some progress, but the are still nothing like America's. Note that your article is from 2008. The articles I link to are from this year. I am not making a case against labor laws. Above, I say doing away with them is "unthinkable." However, I do think American companies who employ US based workers will have a hard time competing against those with less restrictive laws. If you disagree, I am eager to hear your reasoning.


Multi-national companies are no longer good citizens of their communities because they are now stateless. It used to be that a company was a member of the community and you could identify a company as an American company or a German company, etc but now they are looking for the cheapest labor, the least restrictive environmental regulations, no unions, or whatever local situation they can exploit.

The problem is that we don't want the kind of America it takes to compete on that stage. The only way to beat that system is with innovation and a great education system but American universities are giving that away too. We need to protect our innovations and the industries they produce or our best export will be the misery we inflict on workers in China and the rest of the developing world. Read more at www.china-threat.com

D.E. Bishop

I think there is an option being overlooked. Steve Jobs or Bill Gates might have been worth a few $billion less at their death/retirement if they had been willing to pay their American employees an American wage, rather than outsourcing to China. Their companies might have been worth a few hundred billion less if they had been willing to accept a somewhat smaller profit. A few hundred billion goes a long way when it's a relatively small amount for each worker.

Those amounts of money ought to be embarrassing, when the CEOs claim that they can't afford to keep the work in the USA. Corporations can be good citizens, if they are willing to. Perhaps a new, and real pride in, and love for America is in order. It's pretty clear when a business leader claims to love America, but then undercuts America's economy on a daily basis, that he is lying.

Mark Anderson

I believe that we need to look at this differently. I've been told many time that if China would just adopt capitalism, their people would start to become more free. Well, that's not what happened. If capitalism and freedom are not synonymous, then what?

Ken Blanchard

Miranda: Great post! I will add some reflections. In order to generate wealth, one must invest something. The only thing that the poor in this world have ever had to invest is cheap labor. The sweatshops of the early British textile industry were terrible by modern standards. They would look to us like the pits of Tartarus. But they were better, especially for women, than the conditions from which the workers fled. The mills were the means by which the British poor rose to middle class status.

As they rose, their labor became more expensive. The textile industry moved to America, and from the north to the south, and then on to other places, always chasing cheap labor. The reason it kept moving is because everywhere it established itself it always raised the condition of the workers and thus made their labor more expensive. That is the greatest engine of social progress the world has ever seen.

China, India, and Southeast Asia are developing by the same means. To really interfere with trade in the name of worker’s rights would be a disaster for most of the world’s workers.

That said, there is no doubt that conditions in Chinese factories are especially grim. Chinese workers are ruthlessly exploited and frequently poisoned. This has a lot to do with the fact that the Chinese system is hideously corrupt and undemocratic. As workers improve their economic status they do not, as they did in the West, acquire political power to protect themselves. For this reason, I very much doubt that China’s labor laws, updated or otherwise, will make much of a difference as Donald seems to think.

Mark Anderson raises a very good question. If China is succeeding in establishing a market economy without democracy, does that mean there is no connection between the two? I remain hopeful. Without eventual democratization, Chinese workers will never escape ruthless exploitation. There is some reason to believe that when the workers are empowered in some way that the state comes to depend on their cooperation, the state will have to give them political power as well. Democracy came to ancient Athens because the Athenian state needed lots of poor men with strong arms to row their war ships. Let us hope that something like that takes place in China.

While I am hopeful, I am not confident. I honestly do not know what to do about the terrible things you mention. I am sure that blocking trade is not the answer.

Ken Blanchard

ps. I posted much the same several days ago, but apparently I forgot to feed the spam filter.


Thank you, everyone, for your comments. I took an unpardonably narrow-minded approach to this problem and I greatly appreciate having the chance to look at the perspectives each of you has offered.

D.E. Bishop: I don’t necessarily disagree with you, but I am not sure what incentive corporations actually have to be "good citizens." And now, after considering the comments of some of the other posters, I am not sure if being a good citizen is necessarily the right thing to do.

Now, if corporations do the right thing, and pay American workers American wages, it might also mean doing the wrong thing, because it puts a Chinese laborer out of work, and, if Cory is right, might even lead to a revolution. On the other hand, if enough American workers lose their jobs, I suppose there could, eventually, be a revolution here as well. If Occupy counts, maybe we have a small one already.

Mark: Good point. Maybe capitalism is just one of the ingredients needed. Perhaps one other is time.

Dr. Blanchard: Thanks for weighing in. After I wrote my original post, I remembered watching a John Stossel segment that made a similar argument. Stossel made a case against buying fair-trade items, saying that fair trade rules could cause sweatshops to close - resulting in unemployment for laborers, rather than employment with better conditions. I found this argument disheartening then and it is still disheartening now, but it does seem logical.

On the other hand, I think there is some reason to keep hoping. It seems strange to think of The Jungle as a cause for optimism, but looking back at Sinclair’s America and then looking at America now (flawed as it may be), shows that things can, indeed, get better. If America had always been blissfully free, constantly respectful of human rights and completely free of oppression, then there would be less room for optimism about China’s future. But Chinese capitalism is still relatively young. Maybe the kind of freedom America has had is something that has to evolve slowly.

Ken Blanchard

Miranda: I haven't seen Stossel's piece but I know something about this. Free trade is often administrated by people dedicated to socialism. In the coffee business, these people discriminate against small coffee farmers in favor of large "collectives". These collectives can be as bad as, and are frequently managed by the same people as, the rapacious bosses who used to sell them out to the big companies. I have no faith in free trade goods.


Interesting. I was not aware of the collective preference. I often like fair trade coffee, but I will think twice before buying it next time.

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