Mar12

SWEATSHOPS: WHAT’S YOUR TAKE?

posted by Tony Chen

The M121 Social Leadership Academy has been going really well. Lots of great people having some much needed conversations. While KONY 2012 takes all the recent headlines, one of the M121 Fellows, Nkechi Charles, recently wrote this thought-provoking piece on sweatshops. Are sweatshops good or bad? Things aren’t as black and white as they seem. Worth the read:

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(Nkechi Charles wrote the following blog post within M121 Social Leadership Academy community site)

Hi Everyone!

I’m taking an advantatge of this opportunity to try to build all of my five strengths: intellection, input, restorative, connectedness and developer :)

About a year ago, my husband introduced me to journalist Nicholas Kristof of the New York Times via an article he wrote about being a proponent of sweatshops. (Nicholas Kristof’s New Yorker article “Where Sweatshops Are a Dream” ) My instant reaction before reading the article was: how can someone be pro-sweatshops?! Has he not heard all the anti-sweatshop campaigns during the last few years? Then I read the article and found myself challenged to step out of my own world paradigm and see from another lens. When helping hurts:John Stossel ABC News: Are Sweatshops factories good? http://youtu.be/JqtS3sFVy7s

There it goes again…the “upside down” effect, I like to call it. That moment when you realize that what you “see” and what you “know” is not the full picture. In fact, it is written that we only know in part. When we begin to see what we did not know before, everything seems to be upside down or rather the opposite of what we once knew to be true. Though it can be disconcerting and down right uncomfortable (LOL!), I’ve come to relish the “upside down” effects as I consider poverty issues. At the end of the day, I rather be proven wrong and be uncomfortable if it means that progress is made toward fighting against poverty.

[blockquote align="left"]I cannot bring myself to say that sweatshops are “good”. But I do know that from all things, even from deplorable things, good can arise from it.

Here is the best video I found that shows both sides of the argument surrounding sweatshops. I myself am still in the process of formulating my position. Just to take a risk and put it out there… I cannot bring myself to say that sweatshops are “good”. But I do know that from all things, even from deplorable things, good can arise from it. When I listen to the challenges faced by my parents and others who grew up in impoverished nations and how they still overcame, they know this to be true. One endures what they must to live.

So bringing it back to the sweatshops issue… I can acknowledge that good can arise from their presence….yet I do believe that there are innovative solutions waiting to be discovered to change the very nature of “sweatshops” from within by focusing on the real qustion. Why do sweatshops exist? Low costs that lead to high profit for owners and needed income by workers currently in poverty. Current anti-sweatshop campaings are demanding higher wages for fair compensation (typically that to be equivalent to the standard of living of those who are pursuing the campaign). If sweatshops comply, they loose their profitability as payment of wages tend to be on a flat rate. Everyone is paid the same amount. The loss of profitability can eventually lead to the shutdown of the sweatshop, causing many workers to loose their primary source of income. A lose-lose situation.

Well what if profit can be gained by both the sweatshop owner and worker and still keep costs relatively low? Based on studies mentioned in “Poor Economics – A Radical Rethinking of the Way to Fight Poverty” (Banerjee and Duflo), a book I am currently reading, if sweatshops owners were to provide competitive wages based on productivity as oppose to a flat rate, productivity would increase leading to an increase in profit. And in turn, the workers would receive an increase in income due to their increased productivity. A win-win situation.

Yes it is true that what the workers receive is far less than what we would receive in the U.S. But don’t forget that the cost of living varies from country to country. Now I’m sure some one who has studied economics can punch a whole in my proposed “solution”. And that’s okay :) The point is before taking any action, listen to get the full story to see if you are addressing the right problem that actually needs to be solved to improve the lives of those in poverty. Here is an example of what some students did in the Dominican Republic (Alta Gracia: A Victory for the Labor Movement! http://youtu.be/0miMILKtcoI )

I would love to hear everyone else’s thoughts…what is your opinion about sweatshops before watching the videos? Has it changed after watching the videos or reading Kristof’s article? Do you have any innovation solutions to this issue? And don’t forget, we are part of the solution being a part of M121 that is seeking to be an innovator through social entrepreneurship in a country like India that is home to many sweatshops.