Dude's got a point

How 'Sweatshops' Help the Poor by Thomas DiLorenzo

First problem: why is it that the only people debating this issue are liberals and conservatives with ulterior agendas? We all know that liberals really care more about how these people live than how much money they earn. And we all know that conservatives really care more about how much money is being made than they care about working conditions. No one ever shuts up long enough to let someone from the third world have a voice.

That being said, what's the REAL solution? Well, frankly, sweatshops are part of it.

And DiLorenzo makes a really going point that needs to be made: those sweatshop jobs are better than anything else those people can get. There was a case a few years ago where they closed a Nike sweatshop somewhere, I think it was Indonesia, and after the factory was closed, all the children working there went into child prostitution instead. Every time there's an opening at a Nike plant, they literally have 100 times as many people applying as they have openings. That's because those people would RATHER be working there than anything else that's available to them.

DiLorenzo is also right that free trade and direct foreign investment is an important part of helping a country develop. If we refuse to buy products made in Indonesia, they're going to be stuck as a third-world country forever. DiLorenzo is right that the liberals on university campuses don't consider that fact (or they do and they're intentionally being dishonest about their motives for killing free trade).

However, DiLorenzo has his own agenda too, so there are important pieces of the puzzle he ignores because they don't profit American corporations. One very important piece he ignores is infant industry protection. No country will every become first-world as long as it relies on Nike factories. It needs to develop its own industries. The poster child for this is Korea. Even though Korea had free trade agreements with the US, there were "exceptions" for certain Korean industries, like cars and computers. Now Korean car & computer companies are world-class and can compete without protection . . . but they never would have gotten there under a pure free trade regime.

Another very important piece is industry nationalization. This is especially important for natural resources. Iraq will never benefit from its vast oil reserves if Haliburton owns all the oil fields. Iraq needs to own its own oil fields to get its own revenue. Of course, many third world countries can't afford to collect their own natural resources, and need to rely on foreign companies to come in and do the dirty work. These companies usually kick back something to the government; some revenue is certainly better than no revenue. But, at some point, the developing country's government needs to be able to take it back. Certainly this is "unfair" to the American corporation who came in and did all the investment, just to have it taken away. That's why Bush hates Hugo Chavez. And, it's fair to argue that American corporations are less likely to go into a developing country in the first place, if they can't get guarantees that their investments will be protected. Even so, there needs to be a mechanism for nationalization in place. A third-world country will never stand on its own as long as an American corporation can drain its lifesblood.

What's the bottom line? Free trade and direct foreign investment help. Anyone who argues otherwise is either ignorant, or they have an ulterior motive.

Why can't we get a legitimate discussion of this issue?

J