Thursday, November 10, 2011

"Oh, Didn't You Know I'd Been Ruined?" Said He

Right after Steve Jobs died, I did a long post which touched on the human cost of economic development in other countries, though it also applies to the US. Much like Lucy yanking the football away from Charlie Brown before he can kick it, there's a recurring pattern of excusing the inhumane treatment of workers (long hours, dangerous working conditions, low pay) by promising that things will get better. As soon as they begin to do so, however, the people in charge of big business get restive: workers are getting too much money, you want things too easy, you're lazy and want to spend time with your families or just relaxing instead of putting in another thirty-four hour shift at the dear old factory. What's the matter with you? Don't you realize that we're all in this together, and that Exploitation, Inc. is just one big happy family? If you keep demanding higher wages, then poor old Exploitation, Inc. will go broke -- its profits have already dwindled to almost nothing because of you lazy, insatiable ingrates. When we go out of business, you'll be sorry, but it'll be too late then!

We hear this spiel even when profits are at record highs, as they are now in the US. It's nothing new, of course. In 1854, Charles Dickens wrote in his novel Hard Times about industrial Manchester, which he called Coketown:
Surely there never was such fragile china-ware as that of which the millers of Coketown were made. Handle them never so lightly, and they fell to pieces with such ease that you might suspect them of having been flawed before. They were ruined, when they were required to send labouring children to school; they were ruined, when inspectors were appointed to look into their works; they were ruined, when such inspectors considered it doubtful whether they were quite justified in chopping people up with their machinery; they were utterly undone, when it was hinted that perhaps they need not always make quite so much smoke ...

Whenever a Coketowner felt he was ill-used — that is to say, whenever he was not left entirely alone, and it was proposed to hold him accountable for the consequences of any of his acts — he was sure to come out with the awful menace, that he would ‘sooner pitch his property into the Atlantic.’ This had terrified the Home Secretary within an inch of his life, on several occasions. However, the Coketowners were so patriotic after all, that they never had pitched their property into the Atlantic yet, but, on the contrary, had been kind enough to take mighty good care of it. So there it was, in the haze yonder; and it increased and multiplied.
(I first read this passage in Allen Chase's The Legacy of Malthus: The Social Costs of the New Scientific Racism [Knopf, 1977], page 61. A very useful book.)

We've made progress since then, though I think even Dickens slightly exaggerated the desire of factory owners to be "left entirely alone." Even in those days, they wanted State protection from unruly workers and foreign competitors. Nowadays they expect more direct government subsidies, because "economic freedom" is so endangered here that a billionaire can't make even another billion unless the tyrannical, vampirical government helps him out.

These noises are meant to distract attention from the companies packing up and preparing to move to greener pastures: states with more "business-friendly" climates, countries where wages are even lower, and workers more vulnerable, than they were in the last free-enterprise haven.

Factories in China’s manufacturing heartland are feeling the squeeze again, with minimum wages in Guangdong province set to rise by as much as 20 percent on Jan. 1 for the second time in less than a year.

Oh noes!

In other words, the days of endless, cheap Chinese labor are limited. What that means for consumers in the United States and elsewhere is simple: Things are going to cost more, soon.

“I think there’s quite a good argument now that the global race to the bottom has been concluded,” said Geoffrey Crothall of the China Labour Bulletin, a Hong Kong-based labor-rights group. “There’s nowhere else to go.”

The Pearl River Delta is no longer a cheap place to produce, but it does have established supply chains, factories and infrastructure. Companies that want to produce ultra-low-cost products are moving inland in China, or to poorer countries like Bangladesh and Cambodia. Yet there’s nothing on the horizon to replace the cheap China model of the 1990s and 2000s.

Oh noes! Wherever shall Wal-Mart go? Whatever shall Wal-Mart do? Read the whole article; if you thought the Coketowners' plight was sad, the suffering of business in the Pearl River Delta will wring your heart.

So it appears we have a dilemma here. One of the defenses of capitalism is that it improves the lives of workers and consumers, but as this story shows, improving the lives of workers and consumers is a threat to capitalism, and therefore to the lives of workers and consumers. If wages go up, prices will go up and profits will go down, and then, more in sorrow than in anger, our beneficent Captains of Industry and Finance will just have to pull up stakes and move on. This appears to be a problem with capitalism itself, whether under socialism, monarchism, or the plutocratic oligarchy that we enjoy here in the Land of the Free: socialist states have run into the same roadblock on the highway to a higher standard of living. Nor has anyone come up with a way of avoiding it, partly because admitting that it's a problem would undermine the case for industry and economic growth.

Since my earlier post on Jobs, a lot more information has surfaced about his unsavory political views: for example, his demand that Obama make the US more like China, because of "the ease with which companies can build factories in China compared to the United States, where 'regulations and unnecessary costs' make it difficult for them." (I suppose it's a mercy that Jobs died before he could see his dream frustrated again. And besides, those lazy, pampered workers in the Chinese computer factories should feel honored to be participating in the creation of new "races," enabling the emergence of posthuman life with the iPhones they make.) And today, very much to my surprise, Eric Alterman has a good piece at The Nation on the human cost of Apple products, part of Steve Jobs's legacy.
Apple is a wonderful company for its customers and investors. So, too, Pixar. (NeXT, not so much…) But Apple is also an engine of misery for its subcontracted Chinese workers. That this story went largely unreported during Jobs’s life is a testament to how enthralled our media are by the myth of the man’s talismanic qualities, and how easily manipulated most reporters are by wealthy, successful entrepreneurs. But it is also a testament to how little the lives of laborers appear to count anymore.
"Anymore"? When did they ever? (Alterman also has to put in a concession that Jobs was a "genius"; so much the worse for geniuses then.) But on the whole this column is one you should read. The slobbering adulation lavished on Jobs even by political liberals and progressives is similar to Barack Obama's now somewhat tarnished luster: both men are marketers, not innovators, and their appeal is based on image rather than substance. You don't even want to look behind the curtain ... do you?