On his MSNBC show yesterday, Chris Hayes addressed the controversy over Apple and Mike Daisey. Daisey has made three appearances on Up With Chris Hayes over the last few months, in some cases repeating the falsehoods from his live show, though not as extensively as he did on This American Life.
In the segment, Chris addressed Daisey’s lies and noted that Daisey has undermined his own cause. He then reiterated the importance of focusing on working conditions in Chinese export factories, discussing one thing that Daisey did well—generating empathy for Foxconn’s workers.
Chris then criticized Daisey for misappropriating the story of a man whose hand was deformed as a result of an industrial accident. Daisey really did meet such a man in Shenzhen, but he didn’t work for Foxconn and, as far as we know, may not have made goods for export to the U.S. That man has a story, but it’s different from the one Daisey told—and that man, too, deserves our empathy.
Chris doesn’t see it this way, but I think the last point is absolutely correct—and undermines the case that we ought to focus on the conditions in the factories that make Apple’s products.
It’s true that the conditions in Foxconn’s factories are, in many ways, grueling—long hours, repetitive tasks, low pay (by American standards), and some risk of industrial accidents. We should have empathy for these workers and understand that their lives are much more difficult than our own.
But these conditions are just one subset of a broad condition: China is a much poorer country than the United States. GDP per capita in China as of 2011 was $8,400 on a Purchasing Power Parity basis, compared to $48,100 in the United States. That means Americans are consuming about six times as much stuff per person as the Chinese are. In all sorts of ways, the Chinese are worse off than Americans. And the Chinese have it better than people in much poorer countries, like Bangladesh and Ethiopia.
None of that is to say that the Foxconn worker isn’t our concern. It’s just that he is not especially our concern simply because he makes goods for the U.S. market. Foxconn's workers are no more or less deserving of our empathy than other ordinary people in China or elsewhere in the world. The question we should ask ourselves is, what can we do to reduce misery and improve living standards in other countries?
Unfortunately, this question is really hard. In the poorest countries, greater investments in public health, clean water, and the like could do a lot to improve living standards. In middle-income countries, the key tasks are increasing productivity and economic growth. Such improvements come from investments in education and infrastructure, and the fostering of a legal and economic environment that encourages business investment. China is doing pretty well at these things lately, and living standards have been rising because of it.
In order for the Chinese to enjoy working and living standards more like Americans’, their economy will have to become more like America’s. Americans’ relatively short workweek and better working conditions are consequences, not causes, of our high productivity.
While I don’t think labor regulation is a key to improving lives in China, properly structured, more regulation could do more good than harm. Particularly, tighter enforcement of some sort of OSHA-style regulations would be a good thing. (I have no interest in telling Chinese employers how long their workday should be; short workdays are a luxury that Western workers enjoy because their high productivity makes them prefer more hours of leisure.)
But I do worry that a lot of the clamor for “labor and environmental standards” in China, and other low- and middle-income exporters to the United States, is basically concern trolling. These concerns tend to be raised by interests whose real goal is making sure manufacturing stays onshore: American manufacturers and the unions that represent their employees. Regulations that lead manufacturers at the margin not to outsource to China hurt Chinese workers, who get pushed into even less desirable and less lucrative jobs.
It doesn’t help that American politicians frame our discussion of Chinese manufacturing in terms of “shipping jobs overseas.” The Chinese, frankly, need these manufacturing jobs more than we do.
Zooming out, this last point reflects a tension in public policy for me and basically anybody else who is some sort of utilitarian. How is it that we have all these policy obligations to help our less fortunate fellow citizens, through transfer payments and the like, but such limited obligations to people in other countries, many of whom are far poorer?
I have a few answers. One is that our public policy contains moral error, and government should be doing more to help the world’s poor.
A second is that policy is constrained by public opinion. People are more willing to tolerate being taxed to support people they relate to than those they don’t. Utilitarian transfers to the domestic poor are much more politically sustainable than those to the international poor. (Relatedly, the more ethnically homogenous a country is, the more popular domestic transfer payments are.)
A third is that domestic transfer programs are a pretty effective way of improving people’s living standards, while aid to foreigners often fails. This is because welfare only works well when surrounded by a civil society that doesn’t exist in poor countries.
All of these are arguments that support free trade, as it’s a way to enrich the world’s poor without transfer payments that are politically and logistically problematic. One of the arguments you hear for trade restrictions is that, while free trade raises GDP, the effects are uneven and certain low-skill workers are hurt when manufacturing gets outsourced. As such, free trade may increase inequality—but only on a domestic basis. Applying a utilitarian calculus globally, free trade might hurt the Mahoning Valley, but it helps much poorer regions abroad, decreasing inequality.
All of which is to say, it’s very important to make very sure that attempts to improve working conditions in China are not backdoor protectionism. There is a temptation to say “well, if the rules make China less competitive and shift jobs back to the United States, so much the better.” But it’s not so much the better. A maximally robust and growing manufacturing sector in China is a key to lifting hundreds of millions of people in that country out of poverty.
If we are to have empathy for the Chinese, that should be our primary concern when thinking about Foxconn and Apple.
