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By Some Doormats
Brad Delong calls an intellectual foul on those who would have us buy fewer coir doormats made with third world labor. He seems to believe that a failure to "think analytically" and understand economics is the problem. That certainly part of the story, but I think the bigger issue here is the powerful grip an unsound version of the doing/allowing distinction has on our intuitions. If I buy product X and the workers who produce it labor under bad conditions, then I am to blame. If I abstain from participating in the Indian economy, then I am not to blame for whatever may happen in India. And the intuition is a powerful one. No one can bring themselves to believe that subscribing to Direct TV with the NFL Sunday Ticket and buying a Tivo instead of donating the money to save the lives of famine victims is really just as bad as taking out a gun and shooting a homeless man you might find in a park somewhere. But these same intuitive principles, well-suited though they may be for life among small groups of people, can have disastrous consequences when applied to an interconnected 21st century world.
September 29, 2004 | Permalink
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Matthew Yglesias has a very smart post about our intuitions on outsourcing: Brad Delong calls an intellectual foul on those... [Read More]
Tracked on Sep 29, 2004 11:36:09 AM
Comments
As always in these cases (the recent Ehrenreich case is another one) DeLong went ballistic. "Think like an economist" is his mantra (also Stiglitz's in his textbook). When you're dealing with absolutely wretched people, the Pareto principle standing alone is a poor guide, since almost nothing you can do can make them worse off, so almost anything you can do is OK.
DeLong's logic reminds me a bit of the Leninist omelette-making arguments I used to hear. Someone with ethical scruples is ridiculed for subjectivity, self-centeredness, and concern for personal purity. (It is true, though, that the boycotter's concern is not mostly with the individual matmaker, but with what she saw herself becoming, making her living off wretchedly exploited people).
The strength of DeLong's argument is in some long-term development where the matmakers eventually save enough money to rise out of their wretchedness, or perhaps the price of mats rises or the matmakers learn to make higher-ticket items, but if this doesn't happen then the original dilemma is real. Whole societies have existed where the majority of the population lived permanently as the matmakers do.
In many third-world economies there are doubts about the freedom of labor. I have heard stories about SE Asian parents selling their daughters to factory owners and then recieving their paychecks. Something like this would be true in the mat case if the jobbers were paying off the police to eliminate competition.
Regarding Matt's point, the doing vs. allowing distinction is something to think about, but it's really a continuum, and while not-saving someone is different than directly killing them, there is always a question as to where to draw the line of obligation. For example, Clinton is blamed (and blames himself) for not doing enough in Ruanda.
Posted by: zizka | Sep 29, 2004 10:33:24 AM
Actually, so far as I can tell from this article, Clinton did do enough in Russia. In fact, he seems to have done too much.
Posted by: Karl, the Idiot | Sep 29, 2004 10:43:37 AM
That's more like it. I'd like to see some better consumer politics among you self-styled progressive intellectuals. It sickened me to read in the New York Times that Josh Marshall writes his blog from a Starbucks, and I've read complaining about Starbucks prices in this blog too, as if Starbucks is the only place to get coffee (as opposed to buying Free Trade coffee from an independent store or making it yourself).
Now that the political power of the average person is negligible, voting wisely with your dollar is the only feasible way to fight both "private" and "public" abuses of power. Yaal mainstream liberals need to start shopping like us radicals if you want tp see real change.
Posted by: Ding Dong | Sep 29, 2004 10:50:35 AM
True analytic thinking would tell you that giving $26 to non-Indian middlemen for a mat that costs 4 cents to produce just to insure that those producers get that 4 cents is idiotic. This just reduces down to the standard justification for exploitation, that these people would be worse off without us exploiting them.
Posted by: Tim H. | Sep 29, 2004 11:22:16 AM
This is well done on DeLong's part.
To you trade-haters out there (Zizka, this means YOU!), what exactly do you suppose the coir-makers would be doing in an alternate universe in which the United States had high tariffs on coir mats?
Posted by: praktike | Sep 29, 2004 11:32:57 AM
Main Entry: en·abler
Pronunciation: i-'nA-b(&-)l&r
Function: noun
: one that enables another to achieve an end; especially : one who enables another to persist in self-destructive behavior (as substance abuse) by providing excuses or by helping that individual avoid the consequences of such behavior
Posted by: jerry | Sep 29, 2004 11:50:11 AM
"If I pay a man enough to buy my car, he will buy my car." Henry Ford.
Old Henry had the solution to the problem. Greed by American and Indian businessmen and consumers takes away the solution.
We have too much accumulation of assets by those at the top and not enough distribution to those at the bottom. Those who that say this redistribution will naturally occur over time need to pick up a history book. Remember the 19th century strikes, labor movements, communism, etc.? Aren't you afraid of the social unrest, revolutions, etc. that will follow these policies?
Posted by: la | Sep 29, 2004 11:58:38 AM
So the point I'm supposed to take away from DeLong is that cheap cotton justifies the injustice of the plantation lifestyle? After all look what happened to the southern economy when slavery was abolished. His argument boils down to the economic advantages of slavery.
If we want current examples of these free trade arguments, we can look at the importation of shrimp. Free traders want to pooh-pooh recent trade restrictions placed on third world importers such as Vietnam, Thailand, Ecuador, and China with claims such as DeLong makes. The working conditions on the shrimp farms of these countries is atrocious. Yet American demand for seafood is the only criteria to be considered with free traders.
Boycott Red Lobster and ask for fresh local shrimp.
http://www.ejfoundation.org/pdfs/smash_and_grab.pdf
Posted by: Just Karl | Sep 29, 2004 12:25:11 PM
Matt, could you take another stab at this? Your post doesn't make much sense to me, though I found DeLong's post powerfully persuasive.
Posted by: cw | Sep 29, 2004 12:25:34 PM
Matthew - what a delightful post. I've always been baffled by the "progressive" position that there is something immoral about buying goods from third world countries. The labor unions I understand - that poor villager is in direct competition with the union member.
But the typical progressive's position seems to me to be the fruit of wishful thinking whose logic I've never understood: if I don't buy goods produced by a plant with labor standards I find distasteful, then ... then what? The 3rd world government will impose higher labor standards? No. The plant owner will improve working conditions? No. What will happen is that the villager who is delighted to move from his life of wretched misery to a life of slight misery will get fired. And my getting on my high horse about miserable working conditions doesn't help that villager one iota.
Please do not attack me for favoring slave labor or any variation thereon. I don't. But when Nike builds a sneaker factory in Indonesia and Indonesians freely flock from their stone-age villages (only half of Indonesians have electrified homes) to work there, I refuse to believe that I would make them better off if I refuse to buy the sneakers they make.
Posted by: ostap | Sep 29, 2004 12:31:11 PM
DeLong misses the point. Why would you buy from Debbie? She's obviously dumb and an enabler of immoral business practices. Why not buy coir doormats from Christina, whose doormats are just about the same price but cut out the middleman? An economic system that no one is willing to purchase from because of the economic system that produces those goods provides an economic incentive for entrepeneurs to create supply chains that people have fewer moral problems with. And what's the problem with that?
Posted by: Constantine | Sep 29, 2004 12:38:19 PM
I guess it all depends on how free you assume the matmakers are to find alternate means of support.
If you assume that in the absence of a doormat market the weavers would live an even more wretched lifestyle, then DeLong's argument seems perfectly moral.
On the other hand its not unrealistic that the middlemen might be able to manipulate the legal process in that region so as to make the weavers essentially a captive labor market. (e.g. by enacting restrictions on other industries that might compete for their labor, or other restrictions on the free flow of capital and labor). In that case, (as with the antebellum south) supporting the system by buying cheap doormats is immoral.
Posted by: DAn F. | Sep 29, 2004 12:39:01 PM
I guess it all depends on how free you assume the matmakers are to find alternate means of support.
If you assume that in the absence of a doormat market the weavers would live an even more wretched lifestyle, then DeLong's argument seems perfectly moral.
On the other hand its not unrealistic that the middlemen might be able to manipulate the legal process in that region so as to make the weavers essentially a captive labor market. (e.g. by enacting restrictions on other industries that might compete for their labor, or other restrictions on the free flow of capital and labor). In that case, (as with the antebellum south) supporting the system by buying cheap doormats is immoral.
Posted by: DAn F. | Sep 29, 2004 12:40:36 PM
If westerners en masse refuse to buy products made until sweat shop conditions improve, then presumably the sweat shop conditions will improve. One would think that the middlemen will pay more & provide better working conditions if doing so necessary to keep their markets. A case study would be the use of child labor in the manufacture of soccer balls in Pakistan, which has 75% of the world market. International condemnation and boycotts of Nike and other brands have resulted in implementation of practices designed to police contractors and to inform consumers that certain brands are child-labor free. The point is not to deprive Pakistan of jobs but to reserve those jobs for adults at higher wages who can then afford to send their children to school. Perhaps some international economist out there can tell us how this is working.
More generally, De Long's post is an effort to reason from first principles to a understanding of the empirical world. Economists (at least when talking to a general audience) often write from a pre-scientific, Cartesian outlook. De Long seems to know little about village India, coir mat manufacture, Indian labor laws and practices, etc. etc. but it doesn't matter because he's got a few basic theories down pat. This is like thinking you can ride a bicycle once you understand Newton's Three Laws of Motion.
Posted by: jr | Sep 29, 2004 12:57:29 PM
The point, Ostap, isn't that nobody should ever buy from a foreign, non-union source, but when alternatives are available - and there almost ALWAYS are - a person who does not want to enable exploiters should take steps to research and learn about the industry practices they are supporting.
If my memory serves me, one of the reasons the Nike/Indonesia flap got so much attention was because some of its contract factories weren't even paying the minimum wage in that country. If you are willing to buy from any factory that can find a workforce to staff the lines, then no working conditions are too poor for you. Marx called this the "reserve army of the unemployed." Even the USA has a desperate underclass willing to work for less than you would believe.
If you believe that the redemption of the Third World will be realized from our modern form of WTO-multinational-corporate-global-capitalism, you should research your purchases to ensure that your dollars are not used to subsidize exceptionally exploitative practices. If enough people took this argument seriously, then bad employers would improve or be driven out by competitive forces. The best parallel for the anti-sweatshop movement is the movement to divest from apartheid South Africa. Unfortunately, people trying to sound "serious" [you were wrong about Iraq too, MY] and answer critiques of exploitative work conditions and calls for better consumer politics with lame responses like yours -- "but Third World Workers will be MORE exploited without my pennies." That's Dick Cheney's argument, coming out of your mouth.
Posted by: Ding Dong | Sep 29, 2004 1:08:00 PM
In terms of the "message" we send the Indian market, there's gotta be a middle ground between "America's not buying, time to find another industry" and "Keep those doormats coming." Given the choice between those two, I'd take DeLong's argument, but it seems a false dichotomy. What about "you'd sell more doormats to America if you were like the guy down the street with the well-ventilated shop paying 6 cents an hour instead of 4?"
Posted by: Adam | Sep 29, 2004 1:59:05 PM
I have no problem whatsoever with low wages in developing countries; if people are willing to work for those wages, they must believe that they represent their best opportunity for advancement, and I am not going to gainsay them.
What I do have a problem with is atrocious working conditions -- high rates of injury, environmental damage, and corrupt supervisors who (in recent examples) chain doors closed to prevent people from leaving (leading to massive fatalities from a fire) and require young female workers to sleep with then in order to keep their jobs. It is my contention that no one chooses to work in such conditions; they are forced into them through inappropriate structures. I will buy any product made anywhere, so long as the workers who make it are treated with decency. I will buy no product from places where workers are not, if I can help it.
Posted by: Kimmitt | Sep 29, 2004 2:32:32 PM
However, reading DeLong's blog, I see that none of this is relevant -- this is a straightforward case of monopsony, and the solutions he advances are excellent.
Posted by: Kimmitt | Sep 29, 2004 2:36:07 PM
The plight of many a Chinese peasant was pretty dire 40 years ago. Yet today many of these same peasants (or their descendents) work for wages that are high enough to force an ever-growing number of firms to eschew increasingly pricey China for cheaper alternatives like Indonesia.
As far as I know it's nigh impossible to go from Bangladesh to Sweden without passing through a Dickenisan stage (similar to the experience of mainland China over the last 20 years) that looks mighty offensive from the perspective of rich Westerners.
Is there an alternative? Maybe, but nobody's come up with a convincing one. Putting a third world factory worker out of a job doesn't make much sense, even if you or I couldn't possibly afford to live on said factory worker's wages (and remember, next time you hear about some poor wretch making 35 cents an hour, be sure educate yourself about what life's necessities cost the poor wretch -- you can be sure it's a lot cheaper to live in Java than it is in Montgomery County). Also, for many underage workers, the primary alternative to wage work in factories is prostitution.
Posted by: P.B. Almeida | Sep 29, 2004 2:37:05 PM
I disagree with Brad DeLong on this issue, although I have a difficult time articulating why. I suspect that it is because I cannot find any place in standard economic thought for the idea of exploitation. I suspect most economists would, when push comes to shove, say there just isn't any such thing if force is not involved, and that ain't right.
Posted by: Tom Slee | Sep 29, 2004 2:37:25 PM
if I don't buy goods produced by a plant with labor standards I find distasteful, then ... then what? The 3rd world government will impose higher labor standards? No. The plant owner will improve working conditions? No. What will happen is that the villager who is delighted to move from his life of wretched misery to a life of slight misery will get fired.
That...depends. Consumer resistance combined with organized advocacy (it takes both) has made some companies take steps to improve (or at least appear to be improving) working conditions in overseas facilities. But it can't just be not buying, it has to be not buying product made through objectionable means combined with organized advocacy that highlights the objections combined with consciously buying -- even where it means paying more -- products not made by those means.
OTOH, even without organized advocacy, its often possible to choose which company and which nation you buy a product from, so if you become informed of the issues, you can vote effectively with your dollars. But the not buying needs to be combined with buying.
Its not a matter of choosing not to buy shoes -- or doormats -- at all, its a matter of chosing who to buy your shoes and doormats from.
Posted by: cmdicely | Sep 29, 2004 2:39:51 PM
I disagree with Brad DeLong on this issue, although I have a difficult time articulating why. I suspect that it is because I cannot find any place in standard economic thought for the idea of exploitation. I suspect most economists would, when push comes to shove, say there just isn't any such thing if force is not involved, and that ain't right.
The large international businesses who the governments -- often not even remotely democratic -- cater to for the personal benefit of government officers do employ force, both directly and indirectly, to compel cooperation with the corporations.
Posted by: cmdicely | Sep 29, 2004 2:43:06 PM
Oh, now I get it. The title's supposed to read "Buy Some Doormats." Silly me.
Posted by: JP | Sep 29, 2004 3:01:49 PM
The key point is ¿Are the doormat workers exploited? That is, ¿are they paid below what their market salary should be? If that is the case, we should do everything in our power to change that. If in the other hand, they are NOT exploited, that is, they are being paid their fair salary, then nothing should stop us from buying the doormats. Of course, how someone whose labor is of so little value will climb out of poverty is a completely different problem.
Posted by: Carlos | Sep 29, 2004 5:06:12 PM
I'm not a free-trade hater, thank you, praktike. I'm a free-trade skeptic. I think that free trade (like shock therapy) was oversold, and DeLong himself seems to agree in part. All doubts were supressed, and the measures were rammed through with mostly Republican votes.
As far as I know, the wonderful things that were supposed to have happened in Mexico didn't happen, partly because labor is even cheaper in Bangla Desh. What I see is a race to the bottom in labor wages which will not end until everyone in the world is employed on the international labor market.
As with the Ehrenreich piece, what I object to most is the extraordinary, murderous vehemence of DeLong's attack. For almost all economists, free trade is sacred and criticism is taboo. He could have made his point about boycotts without the vicious attack.
Posted by: zizka | Sep 29, 2004 7:09:08 PM
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