The - Underground Zero

Contents

Preface vii

Introduction Jennifer Robinson, Gillian Rose and Clive Barnett 1

Chapter 1 Claiming connections: a distant world of sweatshops? 7John Allen

Chapter 2 Media and communication in a globalised world 55Roger Silverstone

Chapter 3 Reaching out: the demands of citizenship in a 103globalised worldClive Barnett

Chapter 4 A place in the world: geographies of belonging 151Karim Murji

Chapter 5 Envisioning demands: photographs, families and 189strangersGillian Rose

Chapter 6 A haunted world: the unsettling demands of a 237globalised pastSteve Pile

Chapter 7 Making the past present: historical wrongs and 289demands for reparationDavid Lambert

Chapter 8 The geopolitics of intervention: presence and 335power in global politicsJennifer Robinson

Conclusion Clive Barnett, Jennifer Robinson and Gillian Rose 389

Acknowledgements 397

Index 403

The Open University course team

CourseTeam Chair of Production

Gillian Rose, Professor of Cultural Geography

CourseTeam Chair of PresentationChris Brook, Senior Lecturer in Geography

External Assessor

Peter Jackson, Professor of Human Geography,University of Sheffield

Faculty of Social Sciences Staff

John Allen, Professor of Economic GeographyClive Barnett, Lecturer in GeographyNick Bingham, Lecturer in GeographyNigel Clark, Lecturer in GeographyCaitlin Harvey, Course ManagerMichele Marsh, SecretaryDoreen Massey, Professor of GeographyGiles Mohan, Senior Lecturer in TechnologyKarim Murji, Senior Lecturer in SociologySteve Pile, Professor of Human GeographyMike Pryke, Senior Lecturer in GeographyParvati Raghuram, Lecturer in GeographyGeorge Revill, Senior Lecturer in GeographyJennifer Robinson, Professor of Urban GeographyPhil Sarre, Senior Lecturer in GeographyDave Turton, Staff Tutor in Geography

Other Open University Staff

Karen Bridge, Media Project ManagerMartin Chiverton, Sound and Vision

Stephen Clift, Media Developer (Editor)Janis Gilbert, Media Developer (Graphic Artist)Lisa Hale, CompositorJo Mack, Sound and VisionMargaret McManus, Picture Research and RightsDiane Mole, Media Developer (Graphic Designer)Howie Twiner, Media Developer (Graphic Artist)

Consultant authors

Klaus Dodds, Royal Holloway, University of LondonOwain Jones, University of ExeterDavid Lambert, Royal Holloway, University of

LondonOwen Logan, University of AberdeenRoger Silverstone, London School of Economics,

University of LondonSarah Whatmore, University of Oxford

ALConsultants

Eluned Jeffries, Associate Lecturer, Region 2 SouthJenny Meegan, Associate Lecturer, Region 12 IrelandRichard Morgan, Associate Lecturer, Region 10 WalesIsobel Shelton, Associate Lecturer, Region 5 East

MidlandsLorraine Wild, Associate Lecturer, Region 2 South

DVD/audioproduction

Michael Burke, Executive Producer, 186 MediaNick Gray, Producer, 186 MediaRebecca Fleckney, Researcher, 186 MediaAngela Hind, Producer, Pier Productions

Preface

This book and its companion volume, A World in the Making (Clark et al.,2006) are part of the Open University course Living in a Globalised World. Bothbooks explore key characteristics of globalisation today.

That the world is now globalised seems an incontrovertible fact. There arethousands of books analysing what globalisation is and hundreds ofthousands of newspaper articles reporting its various aspects. There arecommissions on the state of the world economy, scares over the state of theplanet’s climate and campaigns against certain forms of globalisation;resources and commodities travel thousands of kilometres and televisionpictures can show almost any part of the world instantaneously. Why then twomore books on the phenomenon?

Globalisation today has a paradoxical form. On the one hand, it seems tosaturate our everyday lives in ways it never has before. Many ordinary,seemingly trivial aspects of people’s lives now involve some kind ofconnection with places far away. The clothes we buy, the food we eat, themusic we listen to and the television we watch (not to mention the set we useto watch it on), these are more and more likely to come from distant places.More people are migrating now than ever before in human history. Everydaylife has gone global for many people around the world. But on the other hand,that greater involvement in some of the processes bringing distant parts ofthe world together does not always seem to lead to a greater understanding ofglobalisation. Indeed, globalisation can seem rather baffling. Moreover, itseems clear that even among those people who do claim some understandingof contemporary forms of globalisation there are debates and argumentsabout the implications of various globalising processes. Globalisation is atonce deeply familiar and hotly contested.

These two books concentrate on this paradox of contemporary globalisation.In doing so, they examine both how global processes are now so pervasiveand why globalisation is so debated.

Both books examine the four things that most commentators agree arefundamental to the way globalisation has become part of everyday life. Theyboth examine the global economy, looking at patterns of trade, work andfinance; they both look at various global political institutions and campaigns;they both examine the way new technologies are increasingly networking theworld; and they both explore migration as a particularly important globalisingprocess. In exploring these four processes, both books suggest that thegeography of globalisation – the pattern of where things are and why – iscrucial to understanding how it now works. Thinking geographically is anecessary part of understanding globalisation.

To understand some of the key debates about that rich and surprising globalgeography, A Demanding World and A World in the Making focus on three things

Claiming connections: a distant world ofsweatshops?John Allen

Contents

1 Introduction 8

2 From global factories over there … 132.1 Offshore fragments of industry 14

2.2 In praise of cheap offshore labour? 21

3 … to sweatshops closer to home 263.1 Bringing remote sweatshops within reach 29

3.2 Corporate connections 35

4 Responsibility for elsewhere 424.1 It’s up to the market … 42

4.2 … or it’s all down to connections 44

5 Conclusion 48

References 49

Reading 1A 51

Chapter 1

8 A Demanding World

Figure 1.1 Sweatshop conditions reported by workers in factories supplying leading brands. ‘Publiclyowned’ means that the company has shareholders and ‘privately owned’ means that it does notSource: adapted from Oxfam (based on interviews with workers in factories), 2004

CAMBODIATHAILAND

C H I N A

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ON E S I ALOTTO

a publicly owned Italian company

Workers are humiliated and verballyabused on a daily basis.Women aresubjected to sexual harassment bymale supervisors and management.

Made in IndonesiaFILAa privately owned US company

Union workers are harassed bymale supervisors and management.

Made in Indonesia

MIZUNOa publicly owned Japanese company

Workers are fined for flawedproducts.They are paid piece ratesthat vary according to how muchwork the management want themto do.

Made in China

UMBROa privately owned British company

Workers are refused time off whenill. If workers leave the factory theylose a month’s back pay.

Made in China

Made in Cambodia

Workers are required to work forlong hours without breaks.Trips tothe bathroom require their card tobe stamped by a supervisor. Duringlow seasons their pay is so low it ishard to survive on.

ADIDASa publicly owned German company

PUMAa publicly owned German company

Women work double shifts andcannot refuse overtime becausewages are so low.

Made inThailand

Chapter 1 Claiming Connections 9

1 IntroductionMany of the smaller branded goods on sale to consumers in Europeand North America – the latest in clothing and footwear or the smarttoys and electronic gadgets on offer – are made in factory ‘sweatshops’.Found in the backstreets of modern, Western cities, but more oftenthan not a feature of the poorer parts of the world, factory sweatshopsare an integral part of today’s global economy. Increasingly, as you cansee from Figure 1.1, they are to be found in East Asia, in parts ofChina, Indonesia, Cambodia and Thailand, but they are just as likely tobe located in Mexico and Central America, and on the Indiansubcontinent. Goods that require little in the way of technology orexpensive investment, are suitable candidates for sweatshop production:a term which takes its name from the working conditions under whichsuch goods are produced. As these are primarily places of small-scale,flexible manufacturing, sweatshop workers – mainly women,sometimes children – are commonly subjected to long working hours,forced overtime and a relentless pattern of shift work. Wages are oftenbelow subsistence level and the working environment is frequentlyunhealthy, dangerous and sometimes intimidatory. Job security islargely non-existent and those who protest their exploitation ororganise in response to it are likely to lose their jobs, often withoutwarning. Similar things have been said about work in call centres insome countries, although not to the same degree or extent. Workers infactory sweatshops often have to endure poor working conditions andfew commentators go out of their way to deny such a state of affairs.

A question that is worth asking, then, is given that many people inEurope, North America and other wealthy contexts benefit from thelower prices afforded by sweatshop exploitation in faraway places,should we involve ourselves with the fate of such distant workers? Orare we, quite simply, too far away to care?

Campaign groups, such as Oxfam, the Clean Clothes Campaign andvarious trade union organisations, have long argued that consumersshould be involved and they have achieved considerable success inrecent years in making the link between sweatshops ‘abroad’ and thebenefits reaped by consumers ‘at home’. Through a mix of highlycharged media campaigns, boycotts and protests, such groups have usedthe labels of the big ‘brands’ – companies such as Nike, Gap, Puma,Adidas and Wal-Mart – to make their geographical point: that the dailyhardships suffered by sweatshop workers in places such as Cambodiaand Indonesia to produce goods for the already privileged should concernus. In a globalised world, they argue, there is a connection between what wewear every day and the poverty wages behind the label.

10 A Demanding World

Activity 1.1

You have already glanced at Figure 1.1 and some of the workingconditions highlighted by Oxfam in one of their campaigns. Now considerthe images in Figures 1.2–1.5, which have all been used by campaigninggroups at various times to convey the message that it is consumer demandfor cheap clothing and other basic goods which perpetuates sweatshopconditions.

Figure 1.2 gives you a sense of the scale of the factory workshops andtogether with the other images provides an insight into sweatshop workingconditions.

Do such images connect with your life? Are you moved in any way? Or arethey simply too remote to register in any meaningful manner?

Figure 1.2 Workers assemble shoes at a Nike factory in Vietnam


Figure 1.3 Working at the bottom of the global supply chain in Cambodia(used by the Clean Clothes Campaign)

Figure 1.4 Line workers fix and shape shoe mouldings in a footwear factory inVietnam

Figure 1.5 A sewing station in a Chinese factory (used by the Clean ClothesCampaign)


The difficulty perhaps is that things which happen at some distancefrom the everyday routine of our lives are often hard to place orconnect with. Moreover, it has to be said that not everyone viewsfactory sweatshops in quite the same way as groups such as Oxfam, orindeed endorses their negative claims about the use of cheap labour inplaces such as East Asia. For that is what the statements of such groupsare: claims. And they are far from uncontroversial.

In fact, it is possible to mount a quite different claim which insists thatthe location of poorly paid sweatshops in developing parts of the worldis not only a positive phenomenon, but also the key to a poorer nation’seconomic development. For some economists and pro-market thinkers,factory sweatshops represent a way out of poverty: the price of anentry ticket into global markets. Previous low-wage economies such asHong Kong and South Korea, we are told, turned their countriesaround economically by exploiting their low-cost advantages in globalmarkets. Best to leave well alone, is their message to the antisweatshopcampaigners, and let the markets do their work.

Broadly speaking, for our purposes, the claims and counter-claimsaround sweatshops, as sketched here, underpin two contrasting demands:one to be involved in matters of economic inequality and injustice, nomatter how remote; the other to leave such matters well alone, toremain distant from but not necessarily indifferent to the plight ofothers elsewhere. The aim of this chapter is to explore both positionsin order to examine the idea that we should assume some responsibility forelsewhere, and how this is understood to work in the arguments of theantisweatshop movement and its more pro-market opponents.

Arising out of this, a major concern of the chapter will be to show how– in both demands – what we take to be near to us and what weexperience as far away is less rigid than may at first appear. In the caseof the antisweatshop movement, a critical part of its campaign hasbeen to try to bring exploitation and injustice in some parts of theworld to the attention of people in other, richer parts. Through a seriesof well-orchestrated campaigns, a distant world of sweatshops has beendeliberately drawn closer in an attempt to make present to those in theaffluent parts of the world what life is really like elsewhere. Conversely,those who view the use of cheap labour in parts of Asia as thebeginning of something better, economically, have tended to distanceconsumers from what is happening there by insisting on the complex,fragmented nature of the marketplace. In a world where physicaldistance is measured in miles and kilometres, such concerns may seemodd at first glance, but the intention is merely to ask you to thinkcarefully about how, in the context of globalisation, some demands can


lead to issues being brought close to us, while others can make themappear increasingly distant.

In the next two sections, I spell out in more detail the claims and thecounter-claims which have been made around factory sweatshops.Following that, in Section 4 I look more closely at how these claims aretranslated into demands to take responsibility at-a-distance forconditions in sweatshops, considering both those who take a benignview of the global marketplace and those who see it as an institutionwhich effectively obscures our geographical responsibilities. For themoment, though, I focus on the highly charged issue of the virtues andthe vices of global factories overseas.

Chapter aimsi To examine the extent to which consumption of cheap branded

goods makes consumers responsible for the conditions underwhich they are made.

i To consider the arguments for and against overseas sweatshopexploitation.

i To explore how consumers are distanced from overseassweatshop exploitation and, conversely, how the antisweatshopmovement has attempted to make the issue live andproximate.

2 From global factories over there …Looking back over the 1970s, it is perhaps hard now to appreciate justhow dramatic were the changes to the global map of industry takingplace at that time. As more and more of the world’s industry shifted fromthe affluent nations to the poorer, less developed countries in search ofa cheaper labour force, the global economic map had to be redrawn totake account of the borders crossed and the distances traversed byfirms from wealthier countries seeking to generate higher profits byrelocating their manufacturing and assembly operations elsewhere.

Among the many factors which heralded this global upheaval was theability of firms to separate out routine industrial tasks from the rest oftheir business: to be able to divide the simple, low-paid work from theactivities of research, marketing, administration, management, and soon. Much debated at the time among academics and politicians, thisgeographical separation of tasks was a real departure from what hadgone before, where the economies of North America and Europe had


Defining developed and developingcountriesAt the end of the colonial era, as many newnations gained independence, relative levels ofeconomic development became an importantcriterion by which to distinguish betweencountries. The former colonial powers andwealthier parts of the world generally becameknown as advanced industrial, or developed,countries, while former colonies and poorernations became known as less developed, ormore positively, developing countries. Criticsof the uneven distribution of wealth across theglobe highlighted the role which wealthcreation in some places had played inimpoverishing poorer nations and, rather,described them as actively underdeveloped.The question as to whether economic changeis developing or underdeveloping countriesremains a vital issue, as the debate oversweatshops highlights.

manufactured almost everything, and therest of the world, or what seemed like it,exported raw materials and foodstuffs tothe industrial countries. Where beforegoods were made in one country,components were now increasingly drawnfrom across the globe before finalassembly. To put a pair of trainerstogether, for example, may well haveinvolved sourcing the rubber from onecountry, the air soles from a second, andthe dyes from a third, with the finishedarticle finally stitched together in factorieselsewhere. Driven by North American andEuropean firms, cheaper locations such asHong Kong, Singapore, South Korea,Taiwan and Mexico became host, for thefirst time, to global factories: factorieswhich produced goods, not for sale intheir own local markets, but, and this isthe main point, for re-export to the West.

Perhaps not surprisingly, curiosity about these ‘global factories’revolved largely around questions of geography. Why over there ratherthan over here? Why cross such distances to produce what could bemade at ‘home’? The advantages of a cheap labour force recruited andtrained to produce what turned out to be a rather narrow range ofconsumer goods with limited technology or investment topped the listof responses. Low-cost locations, or more accurately low wages,offered a competitive edge in global markets much sought after byNorth American and European firms. Such an edge heralded thebeginning of ‘offshore’ production and what, nowadays, has becomeknown as global ‘outsourcing’.

2.1 Offshore fragments of industryThe rise of global factories in the 1970s owed much to the rapidimprovement in transport and communications technologies whichtook place at that time and which made it possible to keep in touchwith, and control, production processes in different parts of the world.Just as significant was the fragmentation of industrial productionwhereby parts of the manufacturing process could be relocated over vastdistances. Sewing in garment and footwear production, for instance, wasamong the first activities to be relocated to East Asian destinations, as


was the assembly work in electronics and toys. Production in boththese cases could easily be transferred offshore, in contrast to, say,those tasks which required complex and specialist technologies orexpensive capital investment to set up a factory outlet. Interestingly, itwould have taken little in the way of investigative zeal to piecetogether the emerging geography of this new low-cost landscape. Aquick glance at the label inside a pair of sports trainers or at the side ofa glossy Matchbox toy would have revealed the whereabouts of itsoffshore production. Japan figured prominently in those days, as didTaiwan and South Korea, and a map of offshore locations targeted byWestern firms could have been quickly drawn on such a basis. Such amap would have revealed what became known at the time as the newinternational division of labour (see Figure 1.6).

Defining the new internationaldivision of labourThe new international division of labour (NIDL)took its name from the fact that, in contrast towhat had gone before, firms from the Western,industrialised countries, especially the USAand in Europe, started to invest directly in the‘Third World’, as it was then called. Whereaspoorer, ‘Third World’ countries had previouslymostly exported raw materials and minerals,now they became involved in exportingmanufactured products. Through a process offoreign direct investment, Western firmsestablished increasing numbers of branchplants in the poorer economies of the global‘periphery’. At the same time, factories in thecore, industrial nations closed and workerswere laid off, resulting in a process known as‘deindustrialisation’. The loss of manufacturingjobs in the ‘core’ economies, however, wasmirrored by the growth of manufacturing jobsat the global ‘periphery’ (although the two werenot always directly related) – in economieswhich subsequently became known as theNewly Industrialising Countries (NICs). The‘Asian Tigers’, namely Hong Kong, Taiwan,Singapore and South Korea, were a significantpart of the NICs, as were Mexico and Brazil.Figure 1.6 shows the changing distribution ofworld manufacturing between the ‘core’ andthe ‘periphery’ from the 1950s on. Note howthe proportion of manufacturing in thedeveloping countries increased from the 1970sthrough to the end of the twentieth century.

Year

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100developing countries

industrialised countries

Perc

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1953 1963 1970 1980 1990 1997

Figure 1.6 Changing distribution of worldmanufacturing production (UN estimate) betweenindustrialised and developing countries, 1953–97.Source: Dicken, 2003, p.38, Figure 3.4


What such a map would have failed to reveal, however, was thechanging nature of the connections put in place by Western firms as theyshifted work around the globe. It is often assumed that when Westernfirms, or any firm for that matter, reach out across borders to establisha factory outlet here, an assembly plant there or a subsidiary in somefar-off location, they do so through directly investing and thereby whollyowning such facilities. In the 1970s and 1980s, among the low-costmanufacturing overseas operations, this was indeed often the case, butincreasingly Western firms started to conduct their business at-a-distance through a variety of indirect means, of which subcontractingbecame the principle arrangement. Subcontracting is a way of puttingout work to partner firms on a defined, contractual basis, where thetasks involved are specified precisely, as are the turnaround times andthe quality of the finished goods. As a business arrangement, it is moreflexible than owning factories overseas and more enforceable than astraightforward market exchange relationship.

Activity 1.2

Before you read on, I would like you to dwell for just a moment on thesignificance of this shift from direct investment by Western firms to theestablishment of subcontracting ties with overseas partners. Aside fromoutside firms being able to pass on to the subcontractor the economic riskof supplying a particular good, this relatively new global arrangementmade it easier for firms to change subcontractor should they fail to meettheir production demands and prices.

How, then, would you begin to draw up the lines of responsibility for, say,the production of a pair of sports trainers in a small independent factory inThailand contracted to a global ‘brand’ name such as Nike? Is Nikeultimately responsible? Is it solely down to the factory owner? Read on tothe end of this subsection before you make up your mind.

Nike Inc., the US sportswear firm, did in fact take the lead in organisingits overseas manufacturing business on a subcontracting basis (Donaghuand Barff, 1990). Early on in the 1970s, it established a web ofcontractual relationships (or partnerships, as it preferred to call them),with factories in Taiwan and South Korea, to produce its brandedfootwear. Of these factories, the big-volume producers among themwere also contracted to other Western firms to produce a range offootwear. Nike maintained an arm’s length relationship with most suchproducers, but with others it established closer ties to produce its ‘top-of-the-range’ footwear. These factories, in turn, often subcontracted themajority of their routine and standardised work, as well as their


material-sourcing requirements. A decade or so later, Nike alsodeveloped subcontracting links with factories in China, Thailand andIndonesia in an effort to further diversify its assembly operations. Thesefactories, as before, formed part of a more extensive network ofsubcontracting operations through which component and subassemblywork was outsourced.

So, by the end of the 1990s, Nike had an estimated 800 contractedsuppliers worldwide, with approximately half that figure located in Asia,and many thousands of manufacturers tied indirectly into its businessoperation. Between them, this network of partners, volume producers,component and subassembly firms manufactured for Nike around 175million pairs of shoes each year (Hartman and Wokutch, 2003). Farfrom unusual, this complex, fragmented supply network, conductedlargely at arm’s length on a contract basis, became something of thenorm for the global factory business. Gap Inc., the high street clothingchain, for instance, which subcontracts its garment productionworldwide, has ties with around 2000 factories in Asia where workerssew and assemble its products (Gap Inc., 2004). Like Nike, it has acomplex set of sourcing arrangements whereby it selects and placesorders with manufacturers around the globe who, in turn, subcontracttheir basic, routine and material operations. Realistically, then, themerchandise that it sells in its retail stores in the West and beyond mayhave passed through dozens of hands, factories and firms and acrossany number of international borders before reaching the shopping mall.

A shirt on sale in one of Gap’s many European stores may have beencut, trimmed and sewn by factory hands, or even by home-basedworkers, in, say, Cambodia or the Philippines, with little more thanscissors and a sewing machine; yet we would be hard pressed to knowprecisely how this set of events came to pass or, indeed, whether thelines of responsibility are known. In between, a chain of buyers andsuppliers, trading companies and sourcing agents, place their orders,purchase materials, coordinate production schedules and conduct theircontractual business in a way that fragments responsibility into suchsmall measures that it could be argued that no one can reasonably beheld to account. The market alone seems responsible for how thingscome together, how something like a shirt’s design, sourcing,production, assembly and export are pieced together through a seriesof commercial contracts.

This might help to explain why the harsh realities of life in what appearto be remote factories initially failed to register at the headquarters ofthe big Western firms (Hartman et al., 2003). Along with thefragmented geography of manufacturing production, it is possible to


find a parallel fragmentation of responsibility, as the globalmarketplace makes it just that much more difficult to know who, ifanyone, should be held to account for, say, the corners cut in producinggoods on time or the safety measures compromised to get an order outthat week. In that sense, the workings of the global market not onlytangle and complicate the economic relationships involved, they alsoenable the actions of those overseas to be perceived as distant andbeyond the control of Western companies, no matter how well intentionedtheir management may be. By distant here, I mean that the contractualarrangements of the marketplace made everyday life in global factoriesseem not just far away to many boardroom executives, but too remoteto do anything about anyway. Besides which, why should they feelresponsible for factories that they did not own in the first place?

Even the use of the term ‘offshore production’, to describe therelocation of industry, is not entirely innocent in this respect, with itsconnotations of faraway locations, rather than those which might bemerely on the other side of an international border, as is the case withUS firms outsourcing production to nearby factories in Mexico.

From a pro-market standpoint,global market forces and thecompetitive pressures that theygenerate leave businesses with nochoice but to take advantage oflower labour costs elsewhere.In the textile business or the toybusiness, lower wage costs are thekey to profitability; if yourcompetitors find a cheaperlabour source, you either followtheir example or go out ofbusiness. It is not, so theargument runs, because managerslack integrity or compassion thatthere are now moremanufacturing jobs in thedeveloping than the developedworld as a result of thegeographical relocation ofindustry; rather, it is because ‘themarket’ dictates such a change.

Figure 1.7 Land available to build maquiladoras, foreign-owned factories, in Mexico, close to the US/Mexico border


Defining global marketsGlobal markets for manufactured goods, as opposed to, say, primarycommodities such as oil and timber, arose largely in the second half of thetwentieth century as trade between countries intensified. The lowering oftransport costs and the relative fall in trade barriers enabled firms in onecountry to compete with a domestic rival in another. The supply ofmanufactured goods across the globe as a result of worldwide demand,principally from the affluent economies, thus heightened competitionbetween firms across, rather than within, national borders. The ability toaccess global markets through a firm’s cross-border activities on asubcontract basis, in that sense, represents an extension of the globaltrading system. As part of the new international division of labour there isnow a global market for material and component parts as well as finishedgoods. In each case, the uneven geography of labour costs inmanufacturing forms part of a firm’s decision about where to source thesedifferent elements. Table 1.1 gives an indication of the variations in labourcosts across a range of countries.

Table 1.1 Labour costs per worker in manufacturing, 2000: selected countries

Country Labour force (million) Labour cost per worker Value added1perin manufacturing worker in manufacturing(US$ per year) (US$ per year)

China 756.8 729 2885

India 450.8 1192 3118

USA 144.7 28,907 81,353

Indonesia 101.8 3054 5139

Brazil 79.7 14,134 61,595

Russian Federation 77.7 1528 n.d.

Bangladesh 69.2 671 1711

Japan 68.3 31,687 92,582

Germany 40.9 33,226 79,616

Mexico 40.4 7607 25,931

Thailand 36.8 3868 19,946

Philippines 31.9 2450 10,781

Turkey 31.3 7958 32,961

UK 29.9 23,843 55,060

Ethiopia 27.6 1596 7094

France 26.7 n.d. 61,019

Italy 25.7 34,859 50,760

Note: n.d. = no data.1Value added measures the estimated monetary value added to goods by the labour ofeach worker over a year.

Source: adapted from Castree et al., 2004, p.10, Table 1.1, based on World Bank data


Krugman accepts that workers in poor countries who produce goodsfor the already privileged of this world are paid very little. But he arguesthat, wherever these re-export industries have taken hold, there hasbeen an identifiable improvement in the lives of ordinary people. Inpart, this is because the outside firms seeking to source their operationsat a lower cost almost invariably pay more than local companies. Theydo so, he points out, not because they are of a more generous nature,but simply to entice workers to move to their factories, from thesurrounding rural areas or wherever. An Indonesian woman, forinstance, perhaps one of those in Figure 1.8, leaves her family and thecountryside to sew clothes for Nike to earn the higher wages and isbetter off financially than the members of her family that she leftbehind. As more firms move work to the area – this time, say, aTaiwanese or a Hong Kong firm – factories start to compete with oneanother for workers, and wages are bid up as the pool of availablelabour is absorbed. Krugman describes this as a ‘ripple effect’ throughthe economy as wages rise steadily and the country moves out of abjectpoverty to something that, while far from wonderful, is certainly ameasurable improvement on livelihoods that were available before.

There are two points which are central to this line of thinking. One,according to Wolf (2004), is that the whole process, as odd as it may sound,is about mutual exploitation. Outside firms do indeed exploit the poorby taking advantage of the profitable opportunities that a pool of cheaplabour represents. But Indonesian or Chinese workers, for instance, could

Figure 1.8 Women workers leaving a Nike factory in Indonesia


be said to exploit the incoming firms by extracting higher pay from themand taking advantage of opportunities that previously were unavailableto these workers. In this way, both sides stand to gain from thearrangement. And, leading directly on from this, this mutualexploitation is said to represent the price of an entry ticket into theglobal marketplace. Today’s affluent Asian economies such as HongKong, Taiwan, South Korea and Singapore all started out this way, byexploiting their low-cost resource base, and, as we can see from Figure1.9, their growth rates since the 1960s over a 30-year period have beenimpressive. Compared with other less developed parts of the globe,export-led growth has been a huge boon to the workforce of theseAsian countries.

Figure 1.9 Economic growth rates in the Asian NICs and other developing regions, 1960–90Source: adapted from Broham, 1996, p.107, Table 1, based on World Bank GDP data

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On the basis of this type of evidence, it is concluded by Wolf and othersthat what is needed for today’s poor countries is more of the same:greater opportunities to exploit their low-cost resources, not fewer; moreglobal exploitation, not less. After all, they point out, you would be hardpressed to find a sweatshop in Hong Kong or Singapore nowadays,precisely because they have moved onwards and upwards in a kind of virtuouscircle of economic growth to better jobs, higher living standards and muchimproved working conditions. Indeed, some of the biggest companiesmoving work around the East Asia region in the present day are based inthese countries, as well as Taiwan and South Korea. One of the largest, thePou Chen Group, a Taiwanese-owned company, has factories in China,Indonesia and Vietnam. Other firms such as the Hong Kong-based Li &Fung or the Taiwanese-based Nien Hsing Textile Company, are at the centreof subcontracting networks which span much of East Asia, sourcingmaterials from one place, dyes from another, zips from somewhere elseand assembling the outfits in yet another location (see Figure 1.10).

Figure 1.10 Li & Fung Limited global subcontracting networkSource: Oxfam International, 2004; Oxfam Hong Kong, 2004

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By the 1990s, powerful companies like these, many of which startedout as low-cost offshore manufacturers, were a small but significantpart of a Taiwanese or a Hong Kong economy that had goneincreasingly ‘high tech’, moving up the value chain by making the shiftfrom cheap labour industries to better paid, more highly skilled work.More to the point, both Krugman (1997) and Wolf (2004) argue thatthe route out of poverty which these countries took is precisely theone that today’s poorer countries, such as Bangladesh, Cambodia,Indonesia, Vietnam and parts of India and China, wish to follow. And,we are told, it is the exploitation of their abundant cheap labour whichholds the key to that development process.

Significantly, no one from the pro-market lobby is actually denying thatsweatshops exist, or trying to cover up the fact that workers in suchplaces have to endure bad working conditions. But, as the subtitle ofKrugman’s (1997) article suggests: ‘bad jobs at bad wages are better thanno jobs at all’. Low as the wages are in the offshore T-shirt ormicrowave factories compared with those in more developedeconomies, they tend to be higher than those of other workers aroundthem. The human side to globalisation, on this view, is that thousandsof people, mainly women, take these jobs because that is the best hopethat they have. Of course, Western, and indeed non-Western, firms willshift their business from one low-cost country to the next, as Nike andothers did before them, but not without first leaving behind the spoilsof globalisation: the dollars in circulation, the improved tradingfacilities, the better communications and, above all, the prospect ofmoving beyond the global factory business. In short, it is in the broadinterests of those working in sweatshop industries to ensure that thecheapness of their labour is capitalised upon – that it is put to use – byoverseas firms. Any other set of actions, by all concerned, it is argued,would be irresponsible.

Not everyone, however, primarily those in the antisweatshopmovement, would agree with this claim. For them, the logic ofunfolding events is deeply contestable. In fact, they would argue that itis because we are so used to thinking that the market is a law unto itself,that we allow ourselves to be deluded by its simple logic. As we shall seein the next section, far from being a good thing, those in theantisweatshop movement claim that the constant search by the clothinggiants and other multinationals for ever-cheaper offshore locations sealsthe fate of the poorer nations. Economic globalisation, of the kind thatexploits the difference in wage levels between countries, they declare, isnot part of the solution for the poor of this world: it is at the heart ofthe problem. The human side to globalisation for them is not about


using poverty as an economic asset, it is about sharing in a moreequitable manner the benefits that globalisation can bring. This is themessage that the antisweatshop campaigners have tried forcefully to‘bring home’ to consumers in the West and beyond.

Summary

� The shift of the world’s manufacturing base from developed todeveloping economies in the 1970s heralded the beginning ofa new global division of labour and the rise of global factoriesto produce for Western markets. The search for ever-cheaperlabour sources undertaken by multinational firms established anew geography of low-cost manufacturing operations which, tothis day, remains controversial.

� The rise of subcontracting as the most flexible arrangementbetween international firms and their offshore producers inplaces such as East Asia steadily became something of thenorm for the global factory business. One consequence was tofurther fragment offshore production, giving rise to a greatersense of distance between retailers and the working lives ofthose who endure poor conditions and minimal wages toproduce the goods they sell.

� For Krugman and Wolf, the exploitation of poorer countries’cheap labour sources is hailed as a positive outcome, evenwhen undertaken in sweatshop conditions. They claim that itgives the poorer countries a competitive edge which, overtime, can lift their people out of poverty and move them furtheralong the path of economic development and wealth creation.

3 … to sweatshops closer to home

Holding up the East Asian success story as the way forward has, as Iindicated above, little appeal for the antisweatshop movement. For itsmembers, a different image comes to mind of thousands of workerseking out a living from the numerous sweatshops which dot that part ofthe world: one that involves the perpetuation of poverty wage levels,the use and abuse of poor communities, and the constant takingadvantage of what is ready to hand, followed by withdrawal andabandonment. What they see is a vicious circle of decline, a ‘race to thebottom’, as they graphically describe it.


Figure 1.11 Clean ClothesCampaign rally, Amsterdam,1999. The graffiti on the inflatedshoe box says ‘living wage’ and‘do it’ in DutchSource: Clean Clothes Campaign,exhibit 27

The comparatively small economies of HongKong, Singapore and Taiwan, as well as SouthKorea, may have fared well since the 1970s, but, asthe antisweatshop movement sees it, few otherscan follow their example. Campaigners have notbeen slow to point out that the global economynowadays is far more competitive and unequallystructured, making it much more difficult forcountries such as Bangladesh or Indonesia simplyto mirror the achievements of the ‘Asian Tigers’.The world economy is not a level playing fieldwhere all countries start out from the sameeconomic position; the gap between rich and poorcountries is wider than ever before and the uneveneconomic legacies are too great for those at thebottom to overcome. History, and indeedgeography, sweatshop campaigners argue, is not ontheir side. Figure 1.12 shows how, over the lastcentury, the richest countries increased their shareof income fourfold while the poorest countries’income share remained fairly constant throughout.

This, you may well agree, is not the easiest ormost straightforward message to get across,especially to audiences removed from the dailyhardships that workers in Asian sweatshops haveto endure. With the likely impression that little, ifanything, can be done about market forces on thefar side of the globe, the fragmented nature of

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Figure 1.12 The widening income gapbetween countries, 1900–2000: the fiverichest countries in contrast to the five poorestSource: Dicken, 2003, p.513, Figure 15.1


much of what goes on in the world economy can make such hardshipsappear very remote. The challenge, then, that the antisweatshopmovement faced in the 1980s and into the 1990s was how to bring tothe attention of consumers and retailers, mainly in Europe and NorthAmerica, the distant exploitation and injustice that, it claimed,underpinned these consumers’ lifestyles.

Umbrella organisations such as the Clean Clothes Campaign with itsnetwork of groups in Europe and beyond, as well as large non-governmental organisations (NGOs) such as Christian Aid and Oxfamin the UK, and the more recent university-based movement in the USA,set themselves the task of trying to connect the bits and pieces of themarket machinery that comprise the global clothes industry. Where themarket fragmented responsibility or sought to erase it, campaigninggroups, often through rallies such as the one shown in Figure 1.11, triedto render the connections visible, by tracking the lines of so-calledresponsibility between those who actually bought and wore the socks,shirts, vests and trainers and those who laboured to produce them infar-off locations. What they set out to do was collapse the economicdistance created by the market which separated the producer from theconsumer.

Defining non-governmental organisationsNon-governmental organisations (NGOs), as the term implies, act alongside,or even in opposition to, official government bodies (although they often drawon government funding), with many different ambitions. Some work topromote development, others to meet local community needs or toencourage environmental change. Some groups are also interested inbringing about wider political changes, often at the international level, inrelation to the areas in which they work. In recent years, NGOs have becomea critical force in raising public awareness about issues that hitherto may nothave reached a great many people outside of established interest groups andgovernments. Acting as pressure or advocacy groups, they frequently lobbyon a single-issue basis – such as the environment, human rights orsweatshop exploitation – to achieve clearly defined goals. Although notnecessarily democratically accountable, and often with limited resources,their willingness to pursue direct political action alongside traditional lobbyingtactics gives them an influence that repeatedly outweighs their membershipand size.

In practice, the attempt to bring the far-off within reach often touchedupon a range of emotions that tried to give remote sweatshops aheightened sense of presence for distant consumers. Such is Lern’sstory, given in Extract 1.1.


3.1 Bringing remote sweatshops within reach

Activity 1.3

You can judge for yourself how effective campaigning groups have been inrevealing the connections between producers and consumers by readingExtract 1.1, ‘Nike in Thailand: Lern’s story’. Posted on the Oxfam websitein 2003, it represents one among many ways in which antisweatshopcampaigners have attempted to make Asian sweatshops known to a widerglobal audience of buyers and consumers. Read it carefully and make upyour own mind as to the basis of the appeal. What, if anything, is it sayingabout our involvement in Lern’s predicament? How does it try to draw uscloser to events elsewhere?

Extract 1.1

‘Nike in Thailand: Lern’s story’This is Lern’s story, based on an interview [by Tim Connor] conducted withher on 30 November 2002. Lern is not her real name. She asked to use adifferent name so that she wouldn’t be victimised for giving this interview.Lern’s description of working conditions at her factory fits closely withdescriptions that other workers from the factory have given in interviewswith staff of the Thai Labour Campaign.

Lern grew up in a rural area in northern Thailand. It was hard to find workthere, and the work available was very badly paid, so in 1998 she movedto the city to look for work.

She soon found a job working on the stitching line in a factory owned bythe Bed and Bath Prestige Company, which produced clothes for childrenand adults. During her time working at the factory it produced for manycompanies, including Reebok, Adidas, Levi’s Haddad and a number of USUniversities.

Nike was one of the largest customers. The factory was producing for Nikewhen Lern started there in 1998, and continued to produce for Nike right upuntil October 2002, when the factory closed. Lern has a card from Nikewith a summary of the company’s code of conduct on it. Like other workersat the factory she was required to wear this card on a piece of stringaround her neck whenever she was working.

Working hours at the factory were so long that work completely dominatedLern’s life. Her shift started at 8.30am. Theoretically it finished at 5.30pmbut most nights she worked overtime until 10pm and three or four days aweek she worked until 2am. During the high season, in the lead up toChristmas, she would work past 2am. In really busy periods she wouldwork right through the night.


Lern was supposed to get one day off a week, on Sunday. In reality, thisdepended entirely on the level of orders. When orders were low she gotSunday off. During busy times she would sometimes work a whole monthwith no days off. Depending on the level of orders, Lern worked between70 and 110 hours per week.

Lern and other workers were willing to work this many hours in order toearn enough to save and to be able to send some money home to theirfamilies. The legal daily minimum wage in the Bangkok area is 160 Baht($US3.70), too low to meet workers’ most basic physical needs.

At the Bed and Bath factory, as in many clothing factories in Thailand andother countries, workers were paid according to a target system. On thosefew occasions when there was no overtime and they only worked from8.30am to 5.30pm, their income for the day could be less than 100 Baht($US2.30), or could be as high as 200 Baht ($US4.60), depending on howcomplicated the garment was to produce. When they worked overtime until10pm they could earn between 200 and 300 Baht ($US4.60–$US6.90) inthe day. When they worked overtime until 2am their daily income wasbetween 300 and 700 Baht ($US6.90–$US16.20).

Lern had a permanent job at the factory, but the factory also employedcontract workers during busy periods. These workers were only paid for 50hours of overtime per month. They were required to work much longerhours but were not paid for the additional hours. …

Nike, Levi’s, Reebok, Adidas and other companies that placed orders atthe factory all have codes of conduct. These codes were put up on thewalls of the factory and workers wore a summary of the Nike code aroundtheir neck. The only person who ever explained the codes to Lern and theother workers at the factory was their employer. According to Lern heexplained to them how to lie to company representatives whenever theyvisited the factory. Before someone from Nike, Reebok, Adidas, Levi’s oranother customer visited the factory, workers had to clean all the machinesand prepare the factory. All workers were given cloth masks for the day.Mr. Chaiyapat instructed them to only speak positively and to say that theyalways finished work at 8pm.

When the company representatives arrived they would identify whichworkers they wanted to speak to. Factory personnel would then take thoseworkers to a room in the factory for the meeting. On the way to themeeting workers would be reminded that they should only say positivethings about the factory and warned that they would be punished if thefactory received a negative report.

To the best of Lern’s knowledge no-one from any of the brand namecompanies ever tried to meet with workers in a completely confidentialsetting, away from the factory. No-one ever provided workers at Bed and

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