With Power Comes Responsibility

With Power Comes Responsibility

Carl Proper

December, 2012


"Goods produced under conditions which do not meet rudimentary standards of decency should be regarded as contraband and ought not to be allowed to pollute the channels of interstate trade.” – President Franklin D. Roosevelt, 1938, calling for passage of Fair Labor Standards Act (FLSA).

“Most people would still be really disturbed if they saw where their iPhone comes from.”  former Apple executive.[1]


On June 22, 1987, the conservative Reagan Administration asked the Supreme Court to uphold Roosevelt’s principle, as embodied in the Fair Labor Standards Act, against CitiCorp (now CitiBank).  They acted on behalf of workers who had gone unpaid for the weeks before their employer went broke.  CitiCorp had acquired the clothing manufacturer’s production out of bankruptcy, but the products were now “hot goods,” the Court ruled.  They could not be sold until the workers were paid all wages due them.  Liberal Justice Thurgood Marshall (previously Chief Counsel for the NAACP) wrote the Court’s opinion, with conservative Justice Antonin Scalia (still serving in 2012) concurring.

Today, things are different.

No iPads, or other Apple computer products, to cite a contemporary example, were blocked from sale this Spring following revelations of extensive labor abuses in their factories.  On the contrary.  As the Bloomberg news headline noted on March 16: “Apple Stores Packed, Sales Boom as New iPad Debuts”.  This was despite widespread publicity about abuses leading to deaths by suicide and by explosion at Foxconn or other Apple contractor factories. “We’ve known about labor abuses…for four years,” one Apple executive told a New York Times reporter.  “They’re still going on….Why?  Because the system works for us.  Suppliers would change everything tomorrow if Apple told them they didn’t have another choice.[2]

The directly affected workers, of course, were among Apple’s 700,000 –plus subcontractor employees in China.  Overseas contracting today is a sort of “get out of responsibility free” card for U.S. corporations.  But, given the predominance of globally outsourced production by U.S. manufacturers, it is well past time to consider why there are no global rules – or American rules – that are effective in policing global employers.  Conditions where much U.S. production is done now recall the U.S. sweatshop world of one hundred years ago, before the 1911 Triangle Shirtwaist factory burned in New York’s Washington Square, killing 146 employees and drawing world attention to unjust and inexcusable working conditions.

And, as happened a century ago in the U.S., there are growing protests by Chinese workers against unchecked exploitation.  These include riots by indirect Apple employees in overcrowded “dormitories” on Foxconn property and threats of mass suicides.  More effectively, youthful workers at Honda and Toyota, and some other foreign-owned factories, have staged successful strikes, resulting in pay increases and formation of independent local labor unions, formal or otherwise.

Worker protests, and the threat of more to come, together with the embarrassment of the negative news in the U.S., have wrung promises of reform from Apple and its most favored assembly contractor, in China.  How far these reforms go remains to be seen.

On the U.S. labor scene, on the other hand, news tends toward premature reports of the death of organized labor.  The resurgence of what French economist Thomas Piketty has termed “crazy inequality” in the U.S. is fodder on the nightly news.  Nominally “U.S.” corporations play the role of global sovreigns, playing the U.S. off as just one more country bidding for their investment.  While manufacturing workers here have not yet seen their wages cut to “globally competitive” levels, the thought that earnings trend lines in the U.S. and China may cross in the foreseeable future is no longer a joke.

Americans with some sense of history should be asking how it is that workers and voters in the early and mid- 20th century were able to set real limits on corporate power, but so many now acquiesce to a corporate challenge not only to organized labor, but to electoral democracy as the way our most important decisions are made.

To understand the 20th century victories of the common man and woman, I turn to the union and industry where I worked, first as a production worker at raincoat manufacturer Forecaster of Boston in the 1970s, then for thirty-five years as a union organizer and representative for the International Ladies’ Garment Workers’ Union (ILGWU) and its successor unions, UNITE and UNITE HERE.

The early union members in the U.S. garment industry, around the turn-of-the-20th -century, were mostly immigrant Jewish women and men from Russia and its sphere of influence, or from Italy.  They lived together in tuberculosis-ridden tenements, worked together in rat-infested sweatshops, struck and won together in massive general strikes.  They were beaten back for a time as manufacturers outsourced their work to tiny sweatshop contractors, but developed new ideas in negotiations and in union classes.  Eventually, with a boost from the Roosevelt Administration, they won contracts requiring their REAL employers (the manufacturers) to guarantee fair wages, benefits and working conditions – even in the contractor shops.  The manufacturers agreed because they won also:  the ILGWU signed agreements with industry Associations representing whole sectors of garment production, leveling the competitive playing field, and allowing reasonable profits.  Both workers and employers also won when, through political action, the ILGWU gained and defended the right to picket any employer who did not sign an Association contract.

The workers and leaders who won these historic victories believed they were fighting not just for better pay, but to build a better world.  Many were socialists or communists and they were internationalists in origin, ideology and behavior.  At the founding “Convention” of the ILGWU, in 1900, eleven union activists from New York, New Jersey, Baltimore and Philadelphia, with a treasury of less than one hundred dollars, declared themselves an “International” union.  As refugees largely from an unassimilated minority in an oppressive empire, they saw their poverty as the result of injustice – never as a mark of failure.  They knew they, and their class, were destined to rise and to win in this new world – and they did.  We owe them many of the rights we enjoy today.

In 1909, 30,000 mostly women garment workers struck through the winter in New York, and won an initial victory in the “shirtwaist” industry.  In 1910, 50,000 mostly men in the coat and suit industry walked out, and eventually settled a “Protocol of Peace” with their employers.  Future liberal Supreme Court Justice Louis Brandeis helped negotiate the settlement – but only after the workers struck on a massive scale, and made demands.  When, in 1911, more than 100 young women and men died in a wholly preventable factory fire at the Triangle Shirtwaist Company in New York’s Washington Square, union demonstrators and their supporters turned even that to a good purpose – the beginning of state and eventually national health and safety legislation.

Then, as employers responded to workers’ power by closing their directly owned factories and outsourcing work to tiny, fly-by-night sub-contractors, the union was cut to less than half its former size.  Undaunted, the union developed and promoted to its political allies a model for regulating the industry.  They would hold the REAL employers – the manufacturers who owned the garments — responsible for providing decent conditions for ALL workers producing their goods, contractor employees included.

In 1933, new President Franklin Roosevelt seemed ready to sign a deal with employers to freeze workers’ wages until 70,000 garment workers walked off the job in New York City, and 20,000 more walked out in Camden and New Haven.  Desperate employers signed new contracts including industry-wide manufacturer responsibility, conditional on Roosevelt Administration approval.  Following the owners, Roosevelt responded to the union’s hard-fought victory, and approved the deal.  The union – victorious first on its own terms — followed through by turning away from Socialist candidates and committed going forward to the Democratic Party.  Garment workers, even those employed by sub-contractors, began rising toward a new middle class.

In 1947, there came a dramatic confirmation that the ILGWU / New Deal system still worked for everyone.  The new Congress, the first Republican Congress since the Hoover Administration, rewarded its backers by enacting the harshly anti-union Taft-Hartley Act.  This law forbid (among other changes) workers from picketing one employer to help organize another (a “secondary boycott”).  But an exception was made for the ILGWU.  Speaking on the floor of the Senate, “Mr. Republican,” Senator Robert Taft, acknowledged that the garment manufacturer was the “virtual employer” of his contractors’ workers, and alone had the power to prevent sweatshops.

A similar scenario followed in 1959, this time with an exception to the mostly anti-union Landrum-Griffin Act.  Right-wing Republican Senator Barry Goldwater, in a Senate floor dialog with Democratic Massachusetts Senator John F. Kennedy, noted that “We conferees are in the very peculiar position of every one of us agreeing that we do not intend to upset the status quo of the garment or apparel industries.” [3]

Finally, in the Supreme Court case cited at the top of this article, the Republican Reagan Administration and Justices from the left and right of the Supreme Court again confirmed the principle first won through a generation of massive strikes.  With regard to the sweatshop-prone garment industry, the dominant employer could not duck responsibility to the folks actually producing its goods through the subterfuge of outsourcing the work.

Opposition to U.S. sweatshops, for a time, was not a partisan issue.

Then, globalization – of a certain kind – happened.  A small Massachusetts employer, being squeezed out of business, told me about a bill he had seen to The Limited store chain from a Chinese source, in the early days of global outsourcing.  The bill didn’t even include the price of labor, which, compared to other costs was effectively zero.  Manufacturers at first seemed stunned as they realized that neither the union, nor U.S. government regulators, nor the jobs-hungry governments of Mexico, Indonesia or China, were prepared to demand just conditions for workers – and their new indirect employees, even those with nominal labor rights in their own countries, were in no position to make any demands.  Corporate America had died and gone to heaven.

Other industries quickly followed the garment example, relocating production to so-called “third world” countries, where worker rights laws could be largely ignored. A succession of “Free” Trade agreements – opposed by unions in all countries – moved through Congress.  Many liberals split with labor on this issue, seeing “buy American” appeals as selfish and nationalistic, but not foreseeing the depressing effects on the earnings and power of recently liberated African Americans or other U.S. workers. Over time, even working class consumers dealing with declining incomes succumbed to shopping strictly for the lowest price items.  People stopped asking WHY the goods were so cheap:  they knew the answer as they looked at their own paychecks. For management, the old contentious days of sharing power and wealth with organized employees appeared headed toward the dustbin of history.

As for the common worker – the intuitive conviction that a worker actually “owned” a job, as long as s/he put in a good days’ work every day, won no backing from the new breed of economists.  Workers’ intuitions, and the shock from seeing their interests ignored, were global.  In 1987, as I attended an international conference for garment union activists, a Philippine union representative spoke to me of a Sara Lee[4] garment factory that had located earlier to his country.  The plant had recently closed and moved to China, leaving no hope behind.  “Those were our jobs,” he insisted. How could this U.S. employer simply take them away?

The 1999 “Battle of Seattle”, where union members and environmentalists joined together in the streets, demanding shared power with corporations in overseeing world trade, was a high point of globalized labor resistance to the new “neoliberal” economy.  In the aftermath of the demonstrations, however, elected officials continued moving away from the New Deal alliance with labor and into a global anti-worker alliance with corporate interests.

Thus unchecked, U.S. corporate power in our day now looms as an overpowering threat to the once superior rights and conditions of the 99% at home.  As they have succeeded at taking on and taking down workers in one industry after another, now including the public sector in state after state, few organized workers are left to resist.  In the wider world, however, a challenge looms:  “state capitalist” nations like China, bankrolled by U.S. corporate investment, are confronting American corporations now divorced from their own base.  In the pursuit of profit gained not from the common effort of all Americans, but from increased exploitation in the U.S. and abroad, the greed of corporate America risks sinking the ship that once sheltered them along with the rest of us.

Where will powerful resistance to the Age of Greed come from?  We might start by looking to a surprising group of workers, with something in common with our Jewish immigrant fore-mothers one hundred years ago – to a new generation of internal migrants from the rural areas of China.  Like the twentieth-century American socialists from Russia and Eastern Europe, these young people expect a better life than their parents, and have little tolerance for the rampant corruption of that country’s new elite.  But what, if anything, can we, or they, learn from the history of American workers and industry in the 20th century?  And what can we now learn from activists in China?

Within the ILGWU, the socialists eventually defeated the communists, and then moved on to become New Deal liberals.  They had seen how unchecked competition led again and again to extreme instability in the garment industry.   They developed, fought for and won a new system, in which the real powers, the brand-name manufacturers, were held responsible for the conditions of all workers.  As all prospered, a consensus was built against sweatshops that lasted for fifty years.

The power of those early garment workers was greatly enhanced by their highly concentrated employment in the “garment districts” of New York and other cities, and even by their concentration in tenement housing.  This was equally true for the tens of thousands of workers employed in the textile mills of Lawrence, Massachusetts in the years leading up to the great “Bread and Roses” strike of 1912.  And it will prove true for the millions of manufacturing workers in China in our day.  Already, the workers at dominant employer Apple’s favored sweatshop partner, Foxconn, have won better conditions and significantly higher wages from a succession of protests, with solidarity facilitated by plants where thousands work elbow-to-elbow, then retire to on-site company dormitories.  At Honda and other foreign-owned auto manufacturing plants in China, young workers have won strikes at one plant and then quickly spread word to others with their mobile phones – a sort of “virtual” concentration of potential power.  Rebellions against arbitrary authority have also taken place in many Chinese towns and villages – and often, authorities have had to back down.

A few courageous Americans have played a part as advisors to Chinese organizers, or even, in the case of former Teamster, writer and activist Tim Costello, joining in rewriting Chinese labor law to include the right to form independent labor unions.  In a eulogy to Costello (who died of cancer, two years ago), Professor Liu Cheng, from the Faculty of Law and Politics, Shanghai Normal University commented that:

Mr. Costello’s work is a worldwide contribution.  Working people of the world shall remember him forever. We shall carry on the unfinished lifework of Mr. Costello to struggle hard for the working people so as to reach a harmonious world of the people, by the people, for the people.

But in China today – and now in the U.S. as well – largely unchecked economic power works hand-in-hand with unchecked and corrupt political power, as in the latter years of America’s19th century.  In both countries, popular anger is rising, but in China, there is now more hope and rising expectations.  Already, worker demands are raising living standards in China, making room for rising standards throughout East and Southeast Asia.

We know, from our own history, that while the sympathy of the well-off can be of assistance, employers and political leaders – even friends like Franklin Roosevelt – ultimately respond most to demonstrations of real worker organization and power.  We proved in the early years of the twentieth century that workers can only defeat outsourced sweatshops by holding the dominant manufacturer responsible.  We have experienced in recent decades the futility of demanding an end to imports, and the falling wages at home that result from unchecked exploitation of workers in other parts of the world.

For working people to recover our lost rights and powers, we must respond globally. We have tried nationalism – and it has failed.  “Workers of the world, unite!” is now necessary just to catch up with capital.

The 1909 shirtwaist strike that ignited the ILGWU was called by a 17-year-old immigrant girl.  The first Honda strike in China was called by a 23-year-old migrant man. The rising generation of young Americans and young Chinese will not surrender to the limitless greed of those they have defined as the one percent.  But the history of U.S. garment workers points to the need for cooperation between workers confronting the employer at its home base – typically in the U.S. or Europe — and workers manufacturing the final product – including in China or elsewhere in emerging economies.  For workers anywhere to achieve justice, we must hold employers globally accountable, by union contract and by law, to both direct and virtual employees.

[1] “In China, Human Costs are Built into an iPad,”, Charles Duhigg and David Barboza, New York Times, 1/25/12

[2] ibid

[3] 105 Cong.Rec. 17381 (1959) (remarks by Sen. Goldwater of Arizona)

[4] At the time, Sara Lee owned Hanes and Wrangler brands.

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