Tuesday, November 27, 2007

Barefoot Indian Steelworkers: "Help" Is On The Way

I was reminded of this cartoon while reading some of the comments on the Indian-made manhole covers in NYC.

Let me suggest an alternative caption:

"Help is on the way, barefoot Indian steelworkers. We're cancelling all orders for Indian manhole covers in the U.S., and we're also going to help shut down all of those exploitive, steel foundries in your country that fail to meet the safety standards of advanced economies like the U.S. that are 50 years ahead of you."


At 11/27/2007 3:01 PM, Anonymous Anonymous said...

This isn't 50 years ago.

50 years ago we didn't have the knowledge of safety we have today.

We can afford to pay an extra 25 cents per manhole cover to give these workers safe and sanitary working conditions.

We don't have to close industries in India because they are unsafe and unsanitary. All we need to do is pay a tiny little bit more than the low prices we pay now. You know that Mark and that is what is so disgusting about your post and the cartoon you posted.

At 11/27/2007 3:08 PM, Blogger Unknown said...

When I saw the picture of the manhole cover making (I think that was casting not forging), it brought memories back from 30 years ago...Wanted to give my perspective here, as my father used to be one of those steel worker – to be precise, a cast iron molder who made the sand molds and poured molten cast iron in to those sand molds, in a small town in India. I also used to help him when I was around 10 years old.

The people are not wearing shirts or shoes for a reason – not because of they are so impoverished that they can not afford them. They do not war shirts, as it is hot as hell – do not remember the molten metal temperatures – carrying the molten metal in the buckets, we used to call them “sanks” – a colloquial term I guess if not a technical term. The people who carry those sanks with molten metals would sweat a lot and their shirts would stick to their body, so most would take them off. They are not wearing shoes because, people do not wear shoes, period. They wear what you would call “flip-flops” or sandles during regular times and take them off when they work during the “casting days” – the days when they pour molten metal in to the sand molds, once a week or once a month, other days they make those sand molds.

While it might seem to people that the conditions that existed some 30 years ago are still existing is a testament to “exploitive” nature of the capitalists – but that steel worker, my father, after years of hard work, thrift and enterprise, and after his son, who helped make those molds with him 20 years earlier, became an Investment Banker on Wall Street, died as a small business man.

The “exploitation” feeds the steel workers’ kids – the moral outrage, does nothing.

Long live “exploitation”....

At 11/27/2007 4:08 PM, Anonymous Anonymous said...

Mari, your personal anecdote warms my heart.

Why just knowing that you labored in hot and unsafe conditions as a 10 year old makes me want to lobby to abolish child labor laws here in America.

The “exploitation” feeds the steel workers’ kids – the moral outrage, does nothing.

It is possible to provide safe and sanitary conditions for the workers and pay them a decent wage for their region so that their 10 year old sons don't have to help them at work.

At 11/27/2007 4:20 PM, Anonymous Anonymous said...

See Sylvain E. Dessy & Stéphane Pallage, 2005, "A Theory of the Worst Forms of Child Labour," The Economic Journal, 115 (1), 68- 87:

"Although intuitive and morally compelling, a ban on the worst forms of child labour in poor countries is unlikely to be welfare improving. We show that harmful forms of child labour have an economic role: by maintaining wages for child labour high enough, they allow human capital accumulation in poor countries. Unless appropriate mechanisms are designed to mitigate the decline in child labour wages caused by reduced employment options for children, a ban on harmful forms of child labour will likely prove undesirable. We perform our analysis within a simple model of parental investment in children's education."

I've heard a CBC interview with Sylvain E. Dessy about the paper. As a child in Cameroon he was a child labourer.

At 11/27/2007 4:28 PM, Anonymous Anonymous said...

Anon 3:01 - who is this "we" you keep refering to, as in "we can afford to pay?" Are you a businessman responsible for brokering manhole covers to the city of New York? Great! Then go right ahead and pay 25 cents extra if you think your company can afford it to appease your moral outrage. If you are not that businessman, then please define "we" in your context.

Anon 4:08 - rather than make psuedo moralist, hand-wringing statements like "It is possible to provide," and "decent wage," please tell us what you are going to do to make this possible, and define what makes a "decent wage" in New Dehli. Also, please tell us what you plan to do to make it so these men don't have to work and their sons don't have to help out.

At 11/27/2007 4:31 PM, Anonymous Anonymous said...

Also...who ever said anything about abolishing child labor laws in America?

At 11/27/2007 11:59 PM, Blogger happyjuggler0 said...

Ok, first off, it is not an extra 25 cents per manhole cover. They are 20% to 60% cheaper than in the US, which is another way of saying they cost 25% to 150% more in the US. Manholes don't cost less than a dollar, so your math is way off.

Now imagine that instead "we" outsource our manhole covers to the low cost supplier who can verify that his workers have US safety, health, benefit and working hours, minimum wages, child labor laws (and anything else I forgot) that US workers are guaranteed by law to have. Where would these manhole covers be made then?

Maybe in West Bengal, India, which by the way is where Calcutta is, of unimaginable poverty fame. But maybe not in India at all. Why not Malaysia instead? Or Mexico? Or South Carolina? Or Detroit?

Businesses have an awful lot of things to consider when choosing where to set up shop. There's wages and non-cash compensation, productivity, reliability of workers (e.g. propensity to strike, call in sick etc.), quality of output, speed in filling orders (there is a reason why each Christmas some toys are impossible to find, it is that turnaround times on orders take too long to fill in time on unforeseen highly popular items) corporate taxes, payroll taxes (i.e. invisible income taxes paid by employers, adding to worker cost), electricity costs, electricity reliability, supplier availability and reliability and proximity, proximity of factory to market, quality of roads to seaport or airport, quality and reliability of port, government regulations, bribery, etc.

Now imagine that most of these are better from an employer perspective, i.e. cheaper, in Malaysia. The main exceptions being wages paid and working conditions. Now imagine that this low compensation is enoug to set up shop in India instead of Malaysia, but that after a few months a bunch of "compassionate" college students decide to boycott the goods made from that shop unless they raise wages and enact higher safety standards etc. Guess what? The company closes up shop and moves to Malaysia instead.

Way to go college students!!! You've just thrown mindblowingly poor people living on less than a dollar a day out of work, some of whom really will be unable to feed their families, or buy them needed medicine, or antimalrial bednets, or whatever, and they die. This happens all the time in "developing" countries.

Is this really compassion? Is it really helping these people? The answer is no. If you really want to help poor people from "developing" nations, you'll buy products that you think come from sweatshops instead of boycotting them. This will help out their employees, and thatnks to taxes paid and fewer government handouts, it means there is more money to build roads or upgrade ports and so on. It also builds up worker skills, i.e. human cpaital. These upgrades will bring in new businesses that might have set up shop in Malasia (or wherever) instead, as well as encourage new local entrepreneurship, thus bidding up wages in West Bengal.

It might seem cruel to outsource to a company that operates a sweatshop, but it is crueler still to refuse to hire someone whose best job he can find is that very sweatshop which he needs to provide for his family.

At 11/28/2007 1:33 PM, Blogger Alex said...

Thomas Sowell had a two-part piece on this back in 2004 that explained it far better than any of us could. Read here and here.


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