Headlines tell the
tale. Here are three links to the latest updates of online Wall
Street Journal articles by headline, from January 3rd,
5th,
and 6th:
Strike, crackdown, and
then everything returns to the way it was. Production resumes. Is
this a happy or a sad tale? Here is a quote from the "Resumes
Production" article:
"The fizzling of one of Cambodia's largest strikes in recent years brought relief for many garment manufacturers, who have complained of mounting financial losses because of missed shipments and lost orders."
Whew! All of us were
concerned about the garment manufacturers and the stress they
suffered from the strike. Now we can move on. The bodies have been
buried.
Tosoc.org of course
does not want to move on. This is another example how the poor are
treated by the managers when the opportunity arises. Let us look at
some of the economic details, also from the "Resumes Production"
article:
"Garment manufacturing is Cambodia's biggest export business, supplying apparel to retailers mainly in the U.S. and European Union. The industry earned nearly $5.1 billion in the first 11 months of 2013, up 22% from the period in 2012, according to the Commerce Ministry. Cambodia has about 800 garment and footwear factories that employ about 600,000 workers, mostly women, labor officials say.
"Manufacturers favor the country for its low-wage costs, but strikes are frequent because of what union leaders say is widespread discontent with meager salaries, poor working conditions and lax enforcement of labor laws."
This
means that 600,000 workers generated about $5.6 billion in 2013
(estimated), or about $9,330 for each worker. Here is what they are
paid (from the same article):
"The strike started as a protest against the government's offer last month to raise the industry minimum wage 19% to $95 a month, starting in April—well short of union demands for $160 a month. Workers then scorned a sweetened offer made by officials last week—a 25% increase to $100 a month, starting in February—and defied government orders to return to work by Jan 2."
Adjusting
for the proposed increase, the workers are currently paid about
$79.80 per month, or about $958 per year. On average, worker pay is
about 10.3% of industry income in Cambodia.
Instead
of complaining, the Cambodian government probably thinks that the
workers should be grateful. Compare conditions in Cambodia to
conditions in Bangladesh. In our tosoc update for 22 September, 2013,
we noted a report about a Bangladesh garment workers strike (Tosoc
Update 20130922). They were earning on average about $38 a month.
That was less than 10% of industry earnings in Bangladesh.
Since
then we see a report on libcom.org that the Bangladeshi workers have
won a 77% increase in monthly pay, to about $68 a month (Striking
Bangladeshi garment workers win a 77% pay rise). Good for them!
That corresponds to about $816 per year. According to the report, the
Bangladesh garment industry makes about $20 billion per year with 4
million workers, or about $5000 per worker. With the pay increase,
Bangladesh workers will now take in about 16% of their industry
income. Very good!
In
comparison, Cambodian garment workers had been earning about twice
the pay for about twice the production of the Bangladesh workers. The
articles do not say so, but presumably the Cambodian workers or their
representatives are fully aware of what has happened in Bangladesh. A
comparable 77% pay increase for the Cambodian workers would raise
their incomes from about $80 a month to about $142 a month. No wonder
the Cambodians are striking.
Beyond
Cambodia and Bangladesh, US workers also need to be paying attention.
The international rich, meaning international corporations and their
owners, are always looking for cheaper labor. In the apparel
industry, US employment dropped more than 80% from 1990 to 2011 (BLS
Spotlight on Statistics: Fashion). This kind of trend is not
limited to the apparel industry. It could happen in any industry.
The
issue is not so much that US workers will lose their jobs because
corporations move their operations to other countries, though that
happens. The issue is that our money managers (the rich) will invest
our savings in other countries. Those investments will create jobs
that will not be available to our children. This is a variation on
the theme we explored in our post Take
from the Poor. The difference is this: We will be investing in
the growth of other countries and not in the growth of our own. We
will be absentee worklords relative to the workers in other
countries, getting income from the fruits of their labor. If that
trend continues, the risk is that we will work less and less,
becoming a rentier nation. One for which large parts of the rest of
the world labors at relatively low wages to maintain our lifestyles.
(This will be true also for all the "Western" countries,"
not just the US.)
There
is already enough worldwide anger about American "Imperialism."
At this point, that anger is still misplaced. If the trend continues,
however, that anger will ultimately become justified. We and our
children will cease to work to produce what we need. We will be in a
strange and probably unsustainable position. Our incomes will be
based on our investments in those who produce what we need. We will
pay for their goods and services, but if their wages are only about
10% of industry earnings, then we might get back as much as 90% of
what we pay through our investments. What a refund!
That
all depends on their allowing it to happen, however, which seems
unlikely. We need to be prepared for change.
Finally,
for tosoc.org, there is the question how multiple exclusive
currencies and markets would help this situation. The main problem
appears to be government support for international manufacturing
rather than their own people. The Cambodian government ordered the
garment workers to go back to work by January 2nd,
according to the report. All we hear about is corporate greed. We do
not hear enough about government greed. As we said before in Tosoc
Update 20130922, government officials typically are not trying to
keep up with their own people, they are trying to keep up with
Western government officials. That means they have to squeeze their
own people unmercifully.
That
would change if Cambodian government officials were only allowed to
earn and keep an internal currency, one that they cannot convert to a
relatively hard external currency like the US dollar. Then Cambodian
government officials would be in the same economic soup as their
citizens. Their economic loyalties would no longer be to
international corporations, but to their own people. Their wealth
would be linked to their nations' wealth. Their focus would change
from shooting their protestors to negotiating higher wages for their
people. We cannot convert Cambodia from a poor nation to a wealthy
nation overnight, but we may be able to turn it around and keep it
from languishing in poverty. Who knows? We might even be able to help
the US State of Mississippi. Support tosoc.org.
The way capitalism
should be.
Socialism for the
socialists and capitalism for the capitalists.
TheOtherSideOfCapitalism
(admin@tosoc.org)
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© 2014 TheOtherSideOfCapitalism
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