Exploitation! Exploitation! Exploitation! That's all one hears these days in arguments made by anti-sweatshop proponents, based on the common assumption that a sweatshop is the only choice for most workers in the third world.
It does not take an economist to logically think through these statements and find obvious fallacies. How can a sweatshop be the only source of employment? What did people do before the sweatshop arrived?
People pushing the idea of a sweatshop as the only choice for employment are missing the common sense in sweatshop cents: Suppose, I want to open a sweatshop in a third world country. I'm trying to make as much money as possible so I pick a place with low wages. But I can't pick a place where people are absolutely starving. I can't run a factory if all my workers weigh sixty pounds and might die on the spot.
The factory must locate in a place where adequate workers can be found. Before a sweatshop comes to a location, people must have been surviving somehow beforehand. If they were not surviving beforehand, there would be no people. If there were no people, the sweatshop could not open.
Some may say that these individuals were scrounging for food in dumpsters or were involved in prostitution before the factory arrived. This has to be looked at logically as well. If I'm scrounging for food in a dumpster, someone must be eating the food that ends up in the dumpster. Someone must have a job producing wages to buy food. All food in the dumpster comes from food on plates. If this was not true, the food would not be in the dumpster in the first place.
The same argument applies to prostitution. When no one has money to pay, you can't be a prostitute. The prostitute must get money. Where is that money coming from? There must be jobs producing money somewhere in the local economy. One must logically conclude that some sort of economy is operating long before the sweatshop factory ever arrives. If this was not true, there would be no people alive to work in the sweatshop.
A closer examination of impoverished countries reveals the facts. These countries do have other sources of employment, most of which is agricultural. Agricultural work is extremely difficult with few rewards in third world countries. Compared to working the earth, weaving textiles can be considered light manual labor.
This truth on the diversity of labor by occupation can be found in the CIA Factbook list of labor force occupations by percentage.
Upon examining a few impoverished countries, one immediately realizes that the countries supposedly most "exploited" by sweat shops are in fact mostly "exploited" by farm life. Here are a few examples:
Labor By Occupation Percentage ` China India Thailand Mozambique agriculture 49% 60% 49% 81% industry 22% 17% 14% 6% services 29% 23% 37% 13%
Sweatshops fall into the "industry" section of labor force percentages. China is one of the most notorious locations for sweatshops, yet 49% of citizens are involved in agriculture and another 29% in services.
Sweatshops are not the only option to those seeking labor. Sweatshops are the best option available to many workers. Anti-sweatshop advocates claim that it’s either a sweatshop or starvation. Even free market writers make claims that it’s either sweatshops or prostitution.
A more clear picture is one similar to the Industrial Revolution: It’s either sweatshops or farm life. Finding employment in sweatshops more gainful, people are abandoning the farm in pursuit of factory work.
Certainly, the free market writers are somewhat correct. The people who get hurt the most by closing sweatshops are children. Why? Most children do not have the option of working on a farm. Most of the time their only option is prostitution.
How could this be? Why do children rely on prostitution instead of working on a farm? Remember the productivity of a ten-year old child. A ten-year old child is extremely capable of making textiles. A small child could perhaps perform the task better than an adult. However, a ten-year old child cannot do the extremely intense labor that farm life involves.
For farming, employers will hire strong adults. If they do hire children, these children will be paid according to their productivity which is much less than their potential productivity in a sweatshop.
As mentioned earlier, the presence of massive prostitution leads to one of two logical conclusions. Prostitution cannot exist without paying customers. Someone has to have the money to be patronizing this degrading profession.
The first conclusion is that the living standards of everyone in the area are exaggerated. People have some extra money which they spend on prostitution. If workers do have more money than they need, this would disprove some of the supposed "exploitation."
The second option is the presence of sex tourism, which most certainly exists in many parts of the world. If sex tourism exists, other services must exist as well. Similarly with prostitution itself, supply will be created by the demand of sex tourists.
Therefore with sex tourism present, other jobs must be present as well. There are many prostitutes surviving. They must be getting money from a large demand that keeps so many alive. This sex tourism also creates demand for other services such as taxis, hotels, and restaurants.
This shows that even something as despicable as sex tourism creates other jobs which are preferable to farming and probably preferable to working in a sweatshop. The occupational percentages clearly show that all of these countries have sizable service industries. In some cases, the service industry is larger than the manufacturing industry.
Any larger third-world city must have many occupations. Can someone really believe that Mexico City or Mogadishu only run on sweatshops and that sweatshops are the only option for workers? Any city runs on a diverse economy. Merchants sell food, people bring goods to the market, still others load ships destined for other parts of the world, etc.
There are obviously options other than sweatshops for third world country workers. These options are far worse. The common assumption that workers are abused and face no other options is clearly false. It’s not either "sweatshops or starvation." Workers have evaluated options and chosen the best choice that suits their current needs.
One must remember that labor is a finite resource while demands and desires of the market are virtually infinite. If the market is allowed to continue its current path, these countries will be greatly improved as companies will begin to compete over labor.
The solution to this problem is not to buy less sweatshop goods but, in fact, to buy more!
There is nothing more wicked than to see anti-sweatshop proponents advocating boycotts. The future of sweatshop workers relies on the market expanding its operations into impoverished areas.
We have seen this phenomenon during the Industrial Revolution in Europe and the U.S. Recently, we have seen good results in South Korea and Taiwan. These countries did not lift themselves out of poverty through laws regulating wages and working conditions. These areas have, through market competition, driven out the lowest forms of poverty. To eliminate this natural progression is to eliminate all hope for the future in the third world.
July 22, 2006