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VIDEO: Here Is What Unregulated, Non-Unionized Capitalism Looks Like: Apple’s iFactory In China

by on Wednesday, February 22, 2012 at 3:24 pm EDT in Economy, Labor, Politics

Suicide nets under every window.

Conservatives have long derided organized labor and business regulations as some sort of insidious ‘socialist’ cancer that stymies innovation, fleeces hardworking business owners, crushes prosperity and investment capital, and dampens economies with high inflation and high unemployment.

They contend that when corporations are left unburdened by oversight and regulations, to pursue their own profit-maximizing interests, that this will always — as if by an invisible magical hand — optimize the interests of the society in which they operate. 

Obscenely naive or deeply disingenuous, this ideology has been disproved over and over again, since the beginning of the industrial age. In a global economy, the moment a nation catches on — usually when its citizens’ quality of life deteriorates to the point of social unrest — and moves to remedy the situation with more regulations, and by easing organized labor restrictions, the corporations begin to look around to other developing countries for exploitative opportunities.

This now familiar business cycle is especially prominent in sectors that require an educated and highly skilled workforce. This is because higher education is generally funded, not by corporations or government, but by labor itself. This limits the supply of skilled labor, and forces corporations to compete with one another for these self-educated workers, thereby pushing wages upwards.

But unlike labor, who are restricted by national borders in search for employment, corporations are free to roam the world for cheap labor. And corporations have no loyalty to the citizens who reside within the countries they operate. Why pay a premium for an employee with a unique level of expertise, when potential employees with similar skill-sets are being grotesquely undervalued overseas? After all, a corporation’s charter commands it to exploit resources and labor as cheaply as is possible in order to maximize profits. 

At the moment, China happens to be one of those developing nations with a massive poverty-stricken population — ripe for corporate exploitation. 

And what better iconic ‘American’ corporation, but Apple — manufacturer of the world’s most beloved technology products and gadgets — to demonstrate this corporate flight towards labor-exploitative opportunities.

China is a country which conservatives would consider an ideal, unregulated, business-friendly environment. Rather than demanding China raise its labor standards, conservatives would rather weaken U.S. labor standards to be more like China. The conservative plan for bringing jobs home is little more than a race to the bottom. By union busting, cutting government jobs, and further deregulation, American workers will find themselves as powerless and exploitable as our counterparts in developing countries. This, they believe, will make America more ‘competitive.’ This is their ‘free market’ ideology, in a nutshell.

In the following video, ABC’s Nightline was granted unprecedented access to Apple’s factories (owned by FoxCon) inside China. When you see the conditions in which these employees operate, you realize why decent paying American jobs are disappearing, and, as Apple’s recently-deceased CEO admitted to President Obama, “they aren’t coming back.” You begin to understand why young Americans are now questioning whether it even makes economic sense to assume huge amounts of debt in pursuit of higher education.

If you take one thing away from this video, I hope it is that this is not merely an American problem. It is a world problem. The only way to raise the living standards of Americans will be to raise it for everyone else in the world, because this is truly a global economy. And that process begins with rewriting all of our trade deals in ways that empower workers in every single nation, across the world. 

Some highlights from Nightline’s reporting:

  • Apple’s Chinese employees work 12-hour shifts, broken up by two-hour meal breaks, and often seven days per week.
  • Employees work so long and so hard on the assembly line, that most eat their 70 cent meals at the company canteen quickly, so they can catch up on lost sleep at their work stations. (the video shows them all sleeping side-by-side during their lunch break)
  • Many employees live in dorm rooms, shared by seven other workers, and will each pay $17.50 per month for this. This allows Apple to have workers on-call 24-7, in case they ever need to quickly scale-up production, at a moment’s notice.
  • Most employees have left their families to work here.
  • Suicide nets‘ have been installed under the windows of all FoxCon employees to prevent them from killing themselves. A year ago, nine employees jumped to their deaths in the span of 3 months.
  • Last year, poorly ventilated aluminum ducts, which the company had been warned about by human rights groups (an accusation the company does not deny), caused two separate explosions in iPad polishing stations, killing four employees and injuring seventy-seven.
  • Literally thousands of people (over three thousand on this particular Monday) line up daily at FoxCon’s recruitment center, waiting hours on end, and many carrying suitcases. They are desperate to work there for $1.78 per hour. Demand for Apple products is so high, that FoxCon will hire 80% of them.
  • To help manage the controversy that erupted after the NY Times’ recent article, In China, Human Costs Are Built Into An iPod, Apple joined the Fair Labor Association. But Apple paid the group $250k to join, and also pays for all its pre-arranged — never by surprise — audits, leading many to believe there is a deep conflict of interest, and is little more than a ploy to whitewash their labor practices.
  • ABC revealed most all of the employees they spoke with complained about their low-pay, expensive lunch prices, and crowded dorms, but there was nothing they could do about it, as unions don’t exist there.

Sounds like a Conservative Utopia!



The Status Quo And How Washington Ensures It

by on Wednesday, October 14, 2009 at 12:03 pm EDT in Politics

A major impasse appears to exist these days between Democrats and Republicans on virtually every issue.  On the surface, it would seem it’s all ideology-based.  But upon closer inspection, their hostilities are, in large part, incited by media-manufactured outrage, where partisan vitriol and ideological demagoguery drowns out all thoughtful discourse.

Unfortunately, our country is in a mess, and on many fronts.  And the proposed solutions (including the watered-down health care reform bill that passed the Senate Finance Committee yesterday) are more about symbolic change than meaningful change.  Nothing gets done, nothing changes, because the biggest problems plaguing our country actually enrich powerful interest groups who are dead-set on keeping it that way.

Were the public (from both parties) to spend more time deconstructing the issues, and connecting the dots, they’d understand their anger is — more times than not — displaced.  Yes, each side strongly believes the other’s ideological perspective is deeply flawed, but their inability to logically discuss issues in a meaningful way, or to pay close attention to lobbyist contributions to their own parties, ensures that they continue to miss the pink elephant in the room whom their elected representatives are tripping over to feed.

The two parties’ key ideological talking points revolve around the following:

The Republican Mantra — the government is everything that is wrong with society.  It taxes hard-working citizens and gives it away to those who don’t work as hard. Big business can be trusted, and a laissez faire approach to the marketplace is essential to economic growth.  Essentially, government is the problem, business is the solution.

The Democratic Mantra — the government is generally good.  It was created by the people for the people.  When market conditions are ripe, corporations will profit by exploiting labor and price gauging the public.  They need to be reigned in to some degree by government.  Essentially, business is the problem, government is the solution.

While there are some truths in each, NEITHER addresses how the realities inherent in both the American political system and its marketplace minimizes the significance of some of their most cherished beliefs.

A large part of the Republican mantra is a myth:

First and foremost, the government DOES exist to best serve the public interest.  It WAS created by the people, for the people.

To embrace the Republican ideology, you must convince yourself not only that government is bad and incapable of doing anything, but that corporate interests are aligned with the public interest.  In reality, NOTHING could be further from the truth.  Corporations have a responsibility to no one, but their shareholders.  They exist to maximize profits by any legal means.

If a corporation can save its shareholders millions of dollars by legally dumping toxic wastes into fresh water supplies, or by outsourcing all their jobs overseas, or by denying coverage to the uninsured, or by denying the claims of the insured, or by selling ‘snake oil’ as medicine, or by price gauging when competition doesn’t exist (like in the pharmaceutical marketplace, where patents ensure monopolies) then these corporations have a responsibility to their shareholders to exploit it to the fullest — to the detriment of the public they serve.

As Thomas Jefferson so eloquently put it: “Merchants have no country. The mere spot they stand on does not constitute so strong an attachment as that from which they draw their gains.”

Take a look at George W. Bush’s laissez faire policies:

Bush drastically cut the funding of the FDA, thereby reducing government oversight over the food and drug industries.  How did the food and drug industries fare when left to their own devices?  We experienced more food recalls in those eight years than in my entire lifetime.  Click into Bush’s report card of October 2006 by the House Committee on Oversight and Government Reform.  It outlines Bush’s significant FDA cuts, and the calamity that resulted.

Take a look at Sen. Lindsey Graham’s success in pushing Wall Street deregulation during both the Clinton and Bush years:

In one remarkable stretch from 1999 to 2001, [Graham] pushed laws and promoted policies that he says unshackled businesses from needless restraints but his critics charge significantly contributed to the financial crisis that has rattled the nation.

He led the effort to block measures curtailing deceptive or predatory lending, which was just beginning to result in a jump in home foreclosures that would undermine the financial markets. He advanced legislation that fractured oversight of Wall Street while knocking down Depression-era barriers that restricted the rise and reach of financial conglomerates.

And he pushed through a provision that ensured virtually no regulation of the complex financial instruments known as derivatives, including credit swaps, contracts that would encourage risky investment practices at Wall Street’s most venerable institutions and spread the risks, like a virus, around the world.

Warren Buffett, the world’s most astute and successful investor, warned us as far back as 2003 of the threat posed by these derivatives:

The derivatives market has exploded in recent years, with investment banks selling billions of dollars worth of these investments to clients as a way to off-load or manage market risk.

But Mr Buffett argues that such highly complex financial instruments are time bombs and “financial weapons of mass destruction” that could harm not only their buyers and sellers, but the whole economic system.

Had Bush regulators reeled back the financial industry’s exposure to these risky speculative securities, we could have prevented the collapse of insurance Goliath, AIG.  But Bush, being the ever-hard-headed ideologue, rushed to enact even more deregulation initiatives right up to the final months of his Presidency in 2008  — at the same time we were experiencing the financial meltdown from his earlier deregulation.   Since then, AIG has cost the American taxpayers $200 billion dollars, and the tally continues to grow.  Its failure can be directly attributed to risky derivative speculation, and a lack of oversight:

State insurance regulators have said repeatedly that [AIG’s] core insurance operations were sound — that the financial disaster was caused primarily by a small unit that dealt in exotic derivatives.

Anyone who believes that less government (and more freedom for big business) leads to economic stability and is in the public interest, is either delusional, or a Lobbyist.

The Democratic Mantra For Bigger Government Ignores the Fact That Politicians Are ‘On The Take’:

Yes, unlike corporations whose responsibility is only to their shareholders, the government does serve to promote the interests of the American public.  But the truth of the matter is they are beholden to powerful money interests whose political contributions determine whether or not they remain in office.  If politicians refuse to subjugate themselves to these powerful interest groups — on grounds of principle — they not only forfeit their political contributions, the interest groups aggressively bankroll their opposition (in their upcoming election).

The power of these entrenched interests and their hold over our politicians has recently come to the forefront in the ongoing Health Reform debates.  Look at the Democratic Senators trying to kill the public option, and see how much money they are receiving from the health insurance industry.  Keep in mind they are defying the public will.

Even President Obama, himself, who has stated many times in the past that he prefers a single payer system, banished single payer advocates from even getting a place at the table to engage in the discussion.  His closest advisers (Rahm Emanuel and Kathleen Sebelius) have been doing everything in their power to undermine the passing of a robust public option, despite the fact that Americans support a government-run insurance option by a nearly two-to-one margin, 61%-34%.  A public option would guarantee a reigning-in of our nation’s staggering medical costs, and ensure universal health coverage.  So why won’t Obama firmly commit to it and use his bully pulpit to drive it home?

In addition, Obama quickly cut a deal with the Pharmaceutical Industry protecting them from Congressional efforts to use its bargaining power to lower runaway drug prices.   As part of the deal, he also agreed to prohibit American citizens from importing cheaper medications from Canada.  The Pharmaceutical Industry, in turn, agreed to reduce drug expenses by a mere $80 billion — a guaranteed ceiling — and a pittance for such a profitable industry.  In addition, Big Pharma agreed to pay $150 million in advertising for the White House ‘health reform’ agenda.

As the ‘old’ John McCain said back in 1999 (when he still had integrity):

We will never achieve these reforms until we first reform the way we finance our political campaigns. As long as the influence of special interests dominates political campaigns, it will dominate legislation as well. Until we abolish soft money, Americans will never have a government that works as hard for them as it does for the special interests. That is a sad, but undeniable fact of contemporary politics.

A Change of Behavior From Both Parties is Required To Turn This Country Around:

Republicans — Your ideology is misguided, and the proof is all around you.  Your inability to acknowledge this fact and to seek new ideas only serves as a distraction in our country’s attempts to solve its pressing problems.  You must ween yourselves from chasing after shadows cast by the likes of Rush, Hannity, Beck and Fox News.  Your real enemies are not the government, per say.  They are the powerful interests who’ve corrupted our government, and the propagandists who distract you from seeing it.  Enough with the dramatic knee-jerk outbursts over hot-button — but meaningless — sound bites, and focus on getting at the real truth (in other words: stop turning to compulsive liars in search of answers).

Democrats — Policies are to politics, what location is to real estate.  Policies, policies, policies!  Get over the fact Obama won.  Stop making excuses for him each time he breaks another campaign promise, or he’ll never deliver substantive change.  Obama is proving to be one who takes the path of least resistance .  So when you follow like sheep and cheer him on even when he’s selling you out, then you’re ensuring that the path of least resistance for him is the one aligned with the powerful interests — those heavily invested in the status quo — those working against the change you voted for.

If we don’t get a robust public option, or our troops withdrawn from Iraq and Afghanistan; and if we don’t get more transparency in our government, or an investigation into Bush’s torture abuses and other illegalities, or meaningful global warming policies it WON’T be because of an uncooperative Republican minority.  They’re largely redundant.  The battle for real change is taking place within the Democratic Party.

Merchants have no country. The mere spot they stand on does not constitute so strong an attachment as that from which they draw their gains.