Three Cheers for Cheap Labor!…Not Really

By now it’s common knowledge that many of the products or components parts we buy are made abroad, and a lot of times in pretty grim conditions.  Our initial response tends to be one of disgust or anger, as we have all heard about what can go on in these manufacturing plants, not to mention the immediate loss of jobs on our side. 


However when shopping, we all consider the lowest price in terms of the items we choose to buy weather it’s cell phones, ipods, or computers.  But who really knows where that sneaky bit of copper actually came from or where that sleek touch screen was manufactured?  Children or adults, you can bet it wasn’t within our boarders. 

What’s with all the shenanigans?

Well, its not that these multinational corporations are out to do harm to the world.  At least that’s not their primary goal.  The primary goal is profits.  They cut costs basically because you don’t want to buy a cell phone that costs $500.  More likely, you’ll go with the guy who’s selling the phone for $100 whether you know it’s made in substandard conditions or not.  Because hey…times are tough in America.  So the company who doesn’t cut costs tends to be the company that doesn’t last.

Another facet of this is that shareholders of publicly traded companies demand a return on their investment.  This again, goes back to you and me.  Every time you put money into your 401k you expect to make a profit…at least in a “normal” economy.  In essence you are demanding that the company operate as efficiently as possible in order to cut costs and make money.  In fact it’s the law that they look out for shareholders best interests.  Otherwise you might as well have stashed your cash under your mattress. 

Why do the local citizens tolerate these conditions?

If the conditions in these facilities are so horrible, why on earth do the workers stand for it?  Why do they choose to work at these places versus what they were doing prior to the arrival of “the corporation”?  Well, it’s because the overall situation in these facilities is usually better than the alternative.  Sorry to say, but it’s true. 

We’re talking about people who live in parts of the world where they can barely get by as subsistence farmers and who typically welcome any foreign direct investment, because they know that it means a slightly higher wage.  Have you ever seen how a substance farmer in Ethiopia lives?…not so glamorous.  So I guess even if these companies end up depleting the natural resources of an area and destroying the environment (which they often do), at least the locals had a bit higher standard of living for a while.  I guess we’re not so different after all (i.e.; Americans and our cars).

Problems with changing the situation:

  1. No bargaining chips:  Typically if a country does decide to force increased wages or implement any other type of expense, the multinational will simply relocate to the guy next door who could care less about working conditions.  So rather than piss off the big boys and lose their business, the country in question might be very accommodating. 
  2. Green/Sustainable Marketing:  It’s basically you purchasing and paying more for products that come from socially conscious companies.  Companies hear you louder when you spend than when you talk.  But really, what do we know about the products we are buying?
  3. Government Regulation:  This could work great but unfortunately any government that sets up steep regulations for their corporations will inevitably make them less competitive in the global market.  So if all the governments of the industrialized world could just work together…that would be super. 

What else can I say?  Until these developing countries get on the same page and set some standards, until we the consumers agree to pay a higher price for our products, or until the west adapts stricter laws or protectionist politics we may have to be content with raping the world or its labor and resources.  But not to worry, the sun will rise, the waves will crash, and the Chinese will continue to sell us all the lead filled crap we can handle.

Daniel Royse Written by:

Daniel Royse is the founder and editor in chief of the online travel publication, This Boundless World. He has written numerous articles on travel, business and politics and has recently completed his first full-length novel titled The Watermelon King. Daniel is an obsessive writer and explorer who has backpacked to over 50 countries, spanning five continents. To the disbelief of many, he still enjoys long, hot bus rides through chaotic places. More information about The Watermelon King can be found at www.thewatermelonking.com