Saturday, August 23, 2008


from Murph

One of my principle concerns at this time is whether we are experiencing an empire collapse for the U.S. or at least the beginnings of it. For if that is true, it has huge manifestations for all of us on a personal and national level, and of course world wide implications.

Every once in a while I come across an article that deals with what a collapse looks like to the people living it. I think this is an important perspective to keep in mind because history will not record much of the personal effects on the individual. When we dig out articles on whole societies that have collapsed, the historian is primarily concerned with the greater picture rather than the individuals living it. With few exceptions, collapse of an empire does not occur in a generation or less. The consequence is that those going through the collapse for the most part spend most of their time being concerned with the usual everyday problems of how to make a living and support a family. While the collapse may proceed in fits and starts with short periods of recovery, what is experienced is a gradual lowering of the standard of living that can go on for many years.

Rome took about 500 years to completely collapse according to most historians that I have read. The consensus seems to be that it began in 284 AD during the rule of Diocletion and 20 years later of Constatine. The Eastern part of the empire continued into the 1400’s. The historians conclude that the collapse of the Roman Empire brought on the dark ages in Europe. If the American empire does collapse, can we look forward to another form of the dark ages again? Just what we need, another dark age for people to live through.

Of course, this is going to be in retrospect. If indeed the American empire collapses, I wonder what the historians of the future will conclude when it began. Historians point to October 1929 as the beginning of the great depression when the stock markets collapsed upon themselves. To many people, they didn’t even know a depression was happening and where they lived life pretty much went on unchanged. But, the beginning of a collapse of a society/culture/empire is not so easy to pinpoint. So, unless we have a very drastic and sudden collapse that takes place in less than a generation, most people will not see a sudden drastic change in living. Hollywood is very well known for stories of sudden catastrophic events that completely change everything within a very short period of time. While it is true that atomic warfare or natural calamity can do that, (collision with astronomical bodies will fit that bill), a collapse from social forces will probably be a drawn out affair.

Whether it is fast or slow, the elite are going to strive to remain elites, with wealth and control over the rest of the populations. This will be accompanied by shifts in power and wealth among groups of elites, but if history has any consistency, the elites will still be in control. The interesting thing to me is that the pushing and shoving among the elite groups to retain or acquire power will only be successful when they can convince enough of the population to grant them the power. Wouldn’t it be interesting if none of them were granted that power?

The concept of egalitarianism has been around for a long time, that is, a society that is primarily composed of all its members being of equal status, and resources being more or less equally divided among them. The original concepts in forming the United States had a lot of egalitarian parts to it, but left open the ability for some to gain more privilege and wealth. The Bill of Right was an egalitarian concept. However, what this system has morphed into is far from any kind of egalitarianism.

As the collapse proceeds, there is simply going to have to be an attitude change concerning the granting of elite status to individuals and groups. If that change in attitude does not take place, human society will simply change what groups or individual control them, but always, someone will be in control. This will show up as society being whipsawed around by these groups contesting for this control. Individually, it will be very difficult for the members of society to make any plans for how to deal with these changes.

Currently there is a very large volume of speculation of how energy shortages, water shortages, lack of industrialism, incessant wars and shortages of nearly everything is going to affect individual lives. Obviously, if our industrialized society becomes a lot less industrialized, we are literally going to have to live in a more “primitive” manner. One of the problems with this is that the skills needed for this style of living have been largely forgotten and considered irrelevant. This is the result of thinking that society always proceeds to greater and greater complexity and that the technology that supports us will never be lost. This attitude ignores completely what happened with the Roman Empire where almost all of the technology of the day was lost during the collapse, leading to the dark ages. During the collapse of the Soviet Union much of the technology was lost to the major part of the population. Only the elite were able to access technology, and I think that is going to happen to us also. This will show up in the manner of most of the population not having access to the results of industrialization and technology, a more “primitive” style of living.

Wile the baby boomers s, of which I am on the leading edge, may not experience the forced level of ”primitive” living, I can see the younger generation experiencing it with a vengeance. What concerns me is whether this younger generation understands the relationship of forced servitude and elite power when the nation goes into severe power down. If as a group, they do not reject the elitist position of power and privilege, it will just be more of the same, elitists and wanna be elitists in control, and it is obvious that the generation coming up after the boomers has enough of those.

Our attitude on this is that if you are convinced that things are going to fall apart, it is worth while to consider beginning to live as if the collapse is here. That is, begin to power down, learn the skills to try and survive when it becomes a necessity, and most important, start teaching these skills to the younger generation. While that will largely take you out of the mainstream living in our society, it has its benefits. There is a great deal of satisfaction to be gained from learning how to provide for your own well being instead of depending on the society at large. Then, as the social situation gradually degrades, it will be a lot less traumatic adjustment. This is not to say that it is possible for the vast majority of a population to become completely self sufficient. Living a life style where you make all your clothes and footwear or self providing all the other stuff needed for living is for the most part, simply not possible. However, what we can do is reduce our dependency on the larger society by providing first of all, more of our own food, forming small community involvement and cooperation, living a lower energy consumption life style and continuing to educate people about consequences of events.

In the event of a slow downgrading of living standards, the alternative energy sources will become more important I think, but on a much more local basis. I think this will be true because the huge infrastructure needed to maintain a central energy distribution is not able to sustain itself. Its security is questionable right off the top, and much of our infrastructure is outdated and crumbling. In this country, there have been no new refineries built since 1977. A lot of our electrical grid is close to collapsing from a single event. Remember the East Coast and Midwest power failure not so long ago?

No matter what happens in the near future, preparation for a lower standard of living must be dealt with if a person believes that it will be forced on us from a drawn out collapse.

Sunday, August 17, 2008


from Murph

Over the last several years, when cheap easily available energy obviously was in decline, there have been a lot of cures advanced for how to ameliorate the impact on society. The one idea that did take off with a vengeance was substitution of gas with ethanol.

Historically, Fords original cars were made to run on ethanol because the production of petroleum was not in full swing and gas was relatively scarce. As petroleum production in this country was developed, gas became more economical to produce than ethanol and the changeover began. Now, gas is becoming more expensive and petroleum is becoming scarcer because we have used it up at an amazing rate, and we are seeking alternative methods of keeping the nations rolling stock on the road. Ethanol has been touted as the substitute of choice for a variety of reason.

The principle reason for pushing for ethanol production as a substitute is its supposed pollution free use and it is renewable. I have some serious reservations about its being non-polluting that I will not address in this post. Renewability is obvious.

Palooka has pointed out that there are many means of producing ethanol; corn is just one of them. He further points out that an advocate of ethanol production, Blume, has researched this subject pretty thoroughly and he thinks this substitution is possible.

Now I actually don’t relish the prospect of being a naysayer and gloom and doom purveyor. In many respects I am not looking forward to the consequences of expensive fuel and harsh conditions as a result, and it would be to my distinct advantage to be able to drive and continue running much of our society as it is. I don’t have a whole lot of time left in this world, and being an old guy forces this realization. I would much prefer to live in relative comfort until I kick the bucket.

However, I would like to consider myself a harsh realist on many fronts and look at the reality of the situation with wide open eyes and fore go the dreamy eyed view through rose colored glasses. It is entirely possible that several alternate scenarios are possible since I can make no claim to having all the information that may or may not be available. We may indeed have enough petroleum available for some time to come and while driving will become more expensive but not impossible and all the stuff that is dependent on petroleum will be more expensive but available. It is also a possibility that an alternative form of energy that is dirt cheap will be found or developed and we will be in hog heaven again.

Now here is my generalized analysis concerning all that I have read about and heard about on substitution of ethanol for petroleum.

Indeed, there are alternative forms of energy, those that substitute for the liquid fuel and those that produce electricity. In my view they all have some fatal errors in thinking that involve wish fulfillment and another financial bubble that concentrates more wealth into fewer hands. Not one of these alternatives has been sufficiently examined for unforeseen consequences that I can find. All of these different methods involve large infrastructure changes, every one of them, even ethanol. Right off the top, look at the subsidized building of ethanol refining plants. I am talking about a national change over now. Whenever you go about making radical changes to infrastructure it involves huge investments and huge use of raw materials. On the investment side, this country is broke and has huge debt, so where is the investment money to come from? Fire up the printing presses? We know this is being done now and the result is that we have that passes for money loses its purchasing power thus demanding that more money has to be printed to make these investments. Plus, to be able to make the infrastructure changes, you have to have manufacturing facilities, which most have fled to other countries, and you need large workforces. With a pretty hefty segment our population about to retire, where is the workforce going to come from? More imported labor? I sure know that no matter how large a wage I would be offered, I simply cannot handle the long strenuous work days any longer. How about you? I will posit that extending the retirement age to 75 and the accompanying benefits is not going to solve that problem.

Getting back to the specifics of ethanol: To make a national changeover to liquid ethanol as a substitute for gasoline will not happen. Not because we would have to build new distribution infrastructure, but because the actual production would involve huge changes in production infrastructure. At the present, productive farmland is predominately used for some kind of food production. Decreasing that to make fuel would have a huge impact on food availability, rather obviously. Looking for other types of biomass that would not need farm land would be another infrastructure change I am referring to. The only other type of biomass I can think of that would fit the bill is surface water plants. Without huge disruptions to the eco system, we cannot either create enough surface water systems or utilize existing surface water systems to accomplish this. Further, I posit that we have neither the capital nor the resources to try this. Again, on a national level.

You might want to check out the huge amount of tax money that is right now being used to subsidize ethanol production. Last year, a bill was passed that sets 60 billion gallons of ethanol production by 2030, principally from corn. Further investigation shows that some supposed experts in this area calculated that it would take every bit of farmland in the U.S. to accomplish this. Meanwhile, the investors and speculators and some large farms are making a killing. This sure sounds like another economic bubble to me. One other problem that is not being addressed in the media is that ethanol has a lower energy output than gasoline, nearly 30% less. Take a look at these analysis.

This means that at our present usage, it would take more ethanol than petroleum gasoline to drive the same miles. Oregon recently mandated a 10% ethanol blend in its gasoline sales. I generally keep pretty close records on how that has affected gas mileage in our vehicles. Overall, it lowered our mileage by 3 mpg and that is at 10% blend. That is a reduction of around 13% for our vehicles figuring at 22 mpg. So I would be safe in saying that we would need around 13% more liquid ethanol over gasoline, and that is a blend, not 100% ethanol. Nationwide, that would be a hell of an amount.

On a small local level, yes we can use ethanol to drive. But to have that effective, certain conditions have to exist, or be built or changed, and large parts of the country are simply unfit for doing so. Take an examples: If we want to use corn for the raw material, there are very limited areas where this is possible. Where I live, the North West, corn crops are flat out an impossibility, too damned cold and the soil will not permit it. Sufficient water, nationally, is another problem.

So, let’s look at other crops as possibilities. Switch grass, soybeans, cattails, sugar cane, sugar beats, waste biomass and lord knows what else could do the job. No argument from me, as least from an experimental point of view. But, each crop takes the right conditions that do not universally exist. To grow massive quantities of anything is going to take water, lots of it. On a regional basis, having a variety of different crops utilizing a specific areas ability to grow that crop is the problem. Surface water based crops pose special problems and further pollution of waterways and surface water is virtually guaranteed, and damage to whole eco systems would be another nightmare. To complicate this, we are now just beginning to experience water shortages in this country. And, the further away we get from traditional crops the more infrastructures will have to be built to support that type of crop. Again, where will the investment money come from and the work force to support it?

So, from all of this I conclude it is going to be regional localized production if any at all, not national. In my neck of the woods where gardening all by itself is a severe challenge that not many are ready to try at this time, I have no idea what could be used for just our local community to produce ethanol, even if our local poor assed area could somehow come up with the money and materials to build a conversion plant. We were unsuccessful in our first attempt to get switch grass to grow here, for feeding animals, much less producing the tonnage for ethanol production. We are going to try again. While it is true that this area raises lots of cattle and horses and thus there is pasture land, it is limited. So I speculate that in our area we swallow the high cost of fuel imported into the area, or we just quit driving so much. I fully realize that other areas do not have these types of disadvantages, but I think that there are more areas that have these problems than not.

One other problem that is not addressed is the upsetting of the ecology by monocropping anything. We can already track the damage to eco systems and land fertility by monocropping. If we develop other monocrop non traditional farming, (like surface water plants) we will only be compounding the problems. We are already seeing the effects of this type of farming in pollution of the land and water. How much worse are we willing to make it to keep the nations travel miles intact?

From the above arguments, I have to conclude that the hard line advocacy of ethanol production to solve our liquid fuel problems is a futile attempt to keep what we have and is not based on the realities of our environment.

Now on to a not so popular view on this subject. One of my big concerns concerning finding any form of power on a vast scale that is affordable and easily available is the social consequences. Presently, I find our popular and mass culture in this country to be pitiful, disgusting, and irrelevant to what I consider important, and I would just as soon see it make some big changes. Any continuation of our present energy usage will not bring about that change, at least in my opinion. People are simply not going to get out of their comfort zones voluntarily. Peak oil and peak everything else will force it to change. I just hope it is for the better, and again, I would like to live long enough to see how it works itself out.

Saturday, August 9, 2008


Preamble from Belgium

In parts 1 & 2 of this series we first looked at globalization on the macro scale then saw how it affected workers on an individual level before selecting the blue jeans business for scrutiny. In this concluding part we will learn more about Wal-Mart, the world’s biggest single trading company. We will then review the overall situation before going on to explore what other organizations are doing to redress the balance in favor of the majority of the world population.

Wall-Mart in the Global Economy

Wal-Mart has the uncanny knack of knowing the cost price of nearly ever product on earth and uses this as the starting point in their negotiations with sellers. They can get away with this because there are no shortages of companies pursuing them for business. Companies and also the Chinese government seem to have taken the view that Wal-Mart can cover a businesses fixed costs and profits can be taken from their other customers. The problem is that these other customers have to compete with Wal-Mart and want the same low prices. Businesses are willing to deal with Wal-Mart because this is a more effective way of getting their products on shelves from Germany to California than laying out expenditure on an advertising budget. Dealing with Wal-Mart is its own recommendation to other buyers. Often however, meeting production overheads in dealing with Wal-Mart often means taking money out of the workers pockets. This kind of makes you think twice about Sam Walton’s “Made in America” slogan and what “Everyday low prices” actually entails.

Andrew Tsuei, Wal-Mart’s Global Procurement Center MD regards Chinas stable currency; political peace and compliant work force to be as important as price. He added “There may be parts of the world you can buy cheaper but can you get the product on the ship. If the currency constantly fluctuates there is a lot of risk, China has the right mix.” Again international trade favors strong dictatorships.

China has only one trade union, all others are banned and strikes are illegal under China’s brand of communism. Kong Xianghong, the number two party official in Guangdong province acknowledged that low wages, long hours and poor conditions are common in factories doing business with Wal-Mart and other American companies but takes the view that ”It is better than nothing”. Human rights and better conditions are a long ways down the road; the union sees its primary task as seeing that everybody is fed.

On the other hand, Wal-Mart sees itself as a force for good in China, saying that it enforces labor standards and insists companies with which it deals, comply with Chinese law. It insists that workers are paid above the minimum wage; that there are fire extinguishers and fire exits and these all bear a cost. Tsuei added that Wal-Mart employs 100 auditors and in the previous year they suspended 400 suppliers mainly for exceeding overtime levels and permanently banned another 72 companies mainly for employing underage labor. Li Qiang, a labor organizer told that factories are notified in advance of these inspections so that they have time to clean up. A worker can have time sheets claiming she is Miss Lu for the first eight hours of her shift and Miss Wu for the second eight hours. They are also coached what to say if they are asked a question. Giving the wrong (a truthful) answer might result in the factory having to close with the loss of everybody’s jobs. If Wal-Mart really wanted to monitor conditions it could do so with surprise visits and longer inspections but then prices would definitely go up. Wal-Mart likes to be seen to be doing the right thing.

Summing up

In the 12 years following 1980, the US’s top 500 companies increased their assets from $1.18 trillion to $2.68 trillion but over the same period jobs fell from 15.9 million to 11.5 million. Or again, the world’s top 200 companies control 28% of the global economy whilst employing only 1% of the world’s workforce.

And if these developments were not bad enough they are about to get much worse: A new Global Constitution is being written through the organs of NAFTA; GATT; the WTO and now the Multinational Agreement on Investments MAI. They are laying down the laws for a global economy which increasingly allow corporations to go anywhere and do anything they like and prohibit workers and governments that supposedly represent them from doing very much about it. It is a World Law which is applicable to every land but not responsible to any nation or to any group of citizens and you didn’t get to vote for it.

You may take the view that the opportunity is open for everybody to become an entrepreneur so it is wrong to be dog in the manger towards those who made it. If you feel so inclined you may take a risk and open a shop or start a back street garage. And especially if you have put your family home on the line to secure funding for the venture you deserve more of the rewards. Very quickly you realize that the objective of the exercise is not to employ as many people as you can. Perhaps wanting more for less is a human trait, after all isn’t that what the leisure society was all about. What is different now with multinational corporations is that the objective has moved away from making money towards power and control and those at the helm of society not only want more for themselves; after taking your assets and redistributing them to themselves, they want you to have less. For the time being, at least, they still need you as consumers.

What Can be Done?

There is a faint glimmer of hope in that half light of dawn before the sun comes over the horizon. Increasingly, working people are realizing that the globalization of the economy has linked their interests to those of workers in other countries. Workers are beginning to understand that that jobs will not be secure and wages will not rise if corporations are able to exploit foreign workers living under dictatorships and unable to stand up for themselves. This is why more sectors of the trade union movement are building alliances with worker organizations around the world. At the beginning of July 2008, the US union ’‘United Steelworkers’ and the UK union ‘Unite the Union’ merged to form the first link in the proposed global union ‘Workers Uniting’. USW President Leo W. Gerard said “This union is crucial for challenging the power of global capital. Globalization has given financiers license to exploit workers in developing countries at the expense of our members in the developed world. Only global solidarity among workers can overcome this sort of global exploitation wherever it occurs.” This is not just a paper alliance it is a real merger”. This merger is the major step which must be first established but with the US Dollar tanking and jobs likely to follow it down the drain it may be considered by some to be forging a bridge to a sinking ship. Only time will tell. Further links are proposed with worker organizations in many lands. Next under discussion is a bonding with Poland’s Solidarity.

Can international worker solidarity be effective? In December 2007, workers at Danone’s Minster, Ohio yogurt plant successfully unionized. This success was assisted by international support from other unions representing Danone workers worldwide throughout the IUF (International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers). It presents an unusual case of an US Union using grassroots organizing tactics together with a carefully pre-planned and coordinated demonstration of international union solidarity. This combination was able to deter the severe violations of worker rights that take place in most private sector organizing drives in the USA. “The Ohio workers primary issues concerned health and safety; retirement and job constancy and stability” said John Price a Union International Representative, “but what it always comes down to is the dignity, justice and respect for workers.”

You can gift wrap words like unionization, worker solidarity, fraternity, any way you wish but what it comes down to is the veiled or unveiled threat of strike action – a Union exists for no other purpose than to hurt company profits more than loss of wages hurts the workers. One can follow the logic of the international labor movement but it will take a real leap of imagination for US workers to strike in support of wage and condition improvements of Mexican workers who now have their jobs.

One downside is that some at least, remember the 60’s and early 70’s when the power pendulum swung towards the unions. Workers would strike as a first measure of communicating their dissatisfaction to management. Strike first then negotiate afterwards was the motto of the day and Union bosses conducted themselves like mini Mafiosi. If International unionism is to work, then we must be prepared to put the Winter of Discontent behind us and worker representatives must conduct themselves with respectability, dignity and all the guile of their company counterparts.

There are many other organizations working for a more just world society. I will mention just two here; the Women’s International League for Peace and Freedom (WILPF) who are conducting a relentless drive to abolish corporate person-hood.

Again the problem is not recognizing the problem but having the muscle to do something about it. If Wall Street wants to cut down an old wood forest, they are not going to discuss the finer points of the deal with Friends of the Earth unless they are made to.

Two US Politicians, Sen. Sherrod Brown (D Ohio) and Rep. Mike Michaud (D Maine) have introduced the Trade Reform Accountability, Development and Employment (TRADE) Act on 4 June 2008, that has more than 50 House and Senate co-sponsors. The TRADE Act requires a review of all existing trade pacts including the North American Free Trade Agreement (NAFTA); the World Trade Organization (WTO) and others. It sets forth what must and must not be included in future trade pacts and calls for the renegotiation of all existing agreements. It describes the key elements of a new trade negotiating and approval mechanism to replace Fast Track that would enhance Congress’ role in the formative aspects of agreements and promote future deals that could enjoy broad support among the American public. One can but hope!

We come to the question of whether the little guy with a one or two man bandwagon can make the big guys fall. I really don’t know if this is possible but Brian Gerrish is one guy who is asking questions that are making many others very uncomfortable. I alluded to his campaign against the organization Common Purpose in a comment in the last post. Nobody is quite sure what Common Purpose actually is but serious people are throwing serious money at it. One thing it does is offer management training schemes which are disguised ‘correct thinking schemes’ where future leaders (persuasive correct thinkers) are trained for rolls throughout all levels of society. The inference, though not directly stated is that this is Europe’s answer to the United States of Europe Constitution being rejected at the ballot box. It is obvious Brian has never attended one of these courses because what his laid back style lacks in dynamism it makes up for in content. Before anybody jumps on my back, it is an hour and a half lecture and meant to be so. The video can be streamed at:

and is well worth a watch.

A recent disturbing aspect in the overall world picture of events is the reported ousting of the Neo-Conservatives by the Trilateral Commission for control of the US White House. This makes the whole world picture greatly more unstable. Any negotiations made whilst these people are sitting in the background will be like sitting down to play poker but with your own hand dealt face up on the table. Have we done too little a little too late?

Much of power is about need. For the moment they need us a lot more than we need them but it will come down to timing and who has the better overall strategy. It will take a grass roots Tank Man movement to win the day; or as Howard Beale said “I’m as mad as hell and I’m not going to take it any more”. In the meantime it is worth remembering that the purchase choices we make have real consequences. Choosing not to shop at your favorite big box store may cause Chinese workers to loose the little they already have but in any war there are going to be casualties and some of them may be on your own side.


Chinese Workers Pay for Wal-Mart’s Low Prices:

Washington Post

Workers Uniting

The First Global Trade Union:

Danone Workers Unionise:

Labour is not a Commodity

Women are now equal victims of a poor economy:

New York Times:

Women’s International League for Peace and Freedom:

Abolish Corporate Personhood

Public Citizen

Global Trade Watch The TRADE Act 2008

Tibet Will be Free

Trilateral Commission takes over White House

Webster G Tarpley:

The Tank Man – Video:

Howard Beale “I’m as mad as hell” clip

From the film “Network”:

Friday, August 1, 2008

Part II - Globalization

How the Blue Jeans Business Works in the Global Economy

From Belgium


In the last section we took an overview of the workings of the global economy. Here we will look at the micro effects of globalisation and talk about the daily routine of a Chinese sweat shop worker. We will then appreciate the true cost in human terms of those cheap imports. Much of this is taken from the documentary film China Blue. Then we will go on to see how household brand names in the blue jeans sector operate their businesses.

An Individual Case – The Life of a Chinese Worker in the Global Economy

At sixteen years of age, Jasmine was a tad older than many when she left her village to become one of China's’ 110 million internal economic migrants. After two days and two nights train journey she arrived in the city of Canton, part of China's industrial south with 100 Yuan given by her father and all of her world contained in a back pack and a green plastic bucket. Pride filled her heart when she found work at a blue jeans factory in a nearby town. Now she had left her childhood behind and could help to support her aging parents. Her duties were as a loose thread cutter and lint remover and right at the beginning it was explained that she would be working seven on seven and there would be overtime. It was shortly afterwards that the reality of her situation began to set in. Mainly because of the level of overtime required it was necessary for her to live on the premises. Her dormitory on the third level, was shared with twelve other girls whose age ranged between 14 (2 years below China's legal limit) and 19. Her bed was a mattress inside a concrete crate structure with a pull back curtain on the open side. All personal washing and washing of clothes was done in this room and all water had to be brought up by hand in buckets. Living expenses and meals provided from a canteen were deducted from her meagre pay. Work began at 0800 sharp and after learning the job it was straight into production and gruelling overtime. It was here that Jasmine learned that she must work a month in hand and if at any future time she left for any reason the boss didn’t like this would probably be forfeited. Still all was not so bad, if the overtime went past midnight, which was common, the boss would provide them with a free meal. The pace was gruelling and the mountain of jeans in front of her never went down. After several weeks the constant workload began to tell on her. Because she could be fined for falling asleep on the job, she slipped out of the factory gate one night to buy a high energy drink to keep her going, got caught on her return and was fined two days pay as an example to the others. Colleagues resorted to clipping their eyelids open with clothes pegs. Sometimes to provide continuity of work, the boss would take orders at close to cost price and then would resort to cutting the workers hourly rate. If the girls ever missed a deadline the boss would become angry and cancel a days pay for the whole factory. On a wall on a bend in the stairs to the dorm stood a notice which read “If you don’t work hard today you will work hard tomorrow looking for another job”. For all of this Jasmine accepted her lot with youthful cheerfulness. Three things kept her going, the good camaraderie with the girls in her dorm; memories of her family and village life and her diary in which she wrote endless pages of half fairy story, half super hero comic strip tales, thereby exposing her youth to view. It gave her pride to send her father his 100 Yuan back. At one US dollar per pair of jeans allocated to the workforce of between 25 – 30 people, her hourly rate amounted to about six US cents. With overtime this left her with about a dollar a day. The only time Jasmine’s cheerful facade cracked was at the New Year holiday when she was the only one who could not afford the train fare back to her village.

The factory owner allowed clandestine filming of China Blue within his factory for two reasons. Firstly he was led to believe that the film was about him as one of the new breed of Chinese entrepreneurs, and secondly he was proud of his factory and considered himself to be very advanced and fair minded towards his employees compared to other factory owners in the area.

The Blue Jeans Business as an Example of the Global Economy in Practice

Are you wearing blue jeans today? Is the brand a household name? If it is then the chances are that they were made in a sweat shop in China, Indonesia, Mexico or another third world country. They could even have been made with sweat shop labour in Los Angeles with a “Made in America” tag sewn in and you wouldn’t even be aware of it. Whether you paid $20 or $200 for them, they all cost around $5 at the factory gates, out of which the total workforce gets a $1.00 share. The rest of the money goes towards advertising, distribution and store costs and the back pockets of the executives. Price alone is not an indication of quality or a garment made with social morality. It is not even the factory bosses who are taking the icing off the cake; multinational purchasing and procurement departments play one factory owner against another with all the subtlety of a Bronx mugger, sometimes beating him down to cost price or less. Have a look through this short list and see if you can find your favourite brand here.

The Limited Inc

Price range $59.50 - $98.00

Buys from sweat shops around the world where young girls live in cramped dorms and work up to 70 hours a week.

TLI washed its hands of the whole business by saying “Limited Brands holds its employees, suppliers and vendors strictly accountable for compliance with all applicable laws and our own business policies, including those relating to labour standards”. In 2003 The Limited Inc settled a lawsuit which accused it and other multinational brands of forcing thousands of garment workers in Saipan to work more than 12 hour days, seven days a week, in a “racketeering conspiracy” that required workers to sign contracts waving their rights. By settling The Limited did not admit any wrongdoing.

The Limited owns the following brands: The Limited; Express; Bath and Body works; Victoria’s Secret, Structure; Lane Bryant and Abercrombie and Fitch.

Tommy Hilfiger

Price range $62.50 – 125.00

Mexican workers reported working in slave labour conditions earning $40 / week for 10 h + days. Workers who tried to unionise were fired. In response, a statement from Tommy Hilfiger said,”I think it is absurd people make clothes in places in the world that are not of US standards”.

When the Tarrant factory in Mexico got itself into a wrangle over unjustly firing workers, Tommy Hilfiger responded by quitting Mexico in a classic cut and run exercise to relocate in other parts of Latin America and Asia where sweat shops abound.

Tommy Hilfiger pays its factory floor workers an hourly rate of between 23 cents and $1.75. CEO Tommy Hilfiger’s hourly wage is $10,769


Price range $79 - $168

“Guess?” ran an estimated 80 sweat shops in Los Angeles employing mostly Latina and Asian women. It paid workers less than the minimum wage for 10 – 12 hour days.

In response to criticisms, the company did not improve conditions but instead ran full page ads in major American newspapers proclaiming “Guaranteed 100% free of sweat shop labour” and it even sewed “Sweatshop Free” labels into its garments.

In 1992 “Guess?” contractors were accused of not paying their employees the minimum wage or overtime. “Guess?” recompensed the workers but was again soon busted for operating illegal sweatshops. In 1996 when workers tried to organise “Guess?” cut and ran to Mexico and Latin America to avoid labour abuse citations. The company still advertises itself as “All American”.

Levi Strauss & Co

Price range $14.98 - $192.00

Saipan is a US commonwealth exempt from American labour laws. Companies who operate are legally entitled to sew “Made in America” tags into their garments. Sweat shop workers there were forced to pay recruitment fees of thousands of dollars. To work off the debt they were kept in indentured servitude. In 2002, 26 of Americas’ largest clothing retailers including Gap, Target and Lane Bryant were found guilty of sweat shop abuses, Levi Strauss was the only company that refused to settle. Linda Butler for Levi Strauss responded “We believe we can operate profitably and with principles at the same time. We’ve done that for many years. A business needs to be profitable. The question is how does one implement tough business decisions with compassion, while avoiding decisions that that have a negative impact on stakeholders?” How indeed!

In 1992 the Washington Post exposed the company of sidestepping the sweatshop issue altogether by having their jeans made by Chinese prison labour. Ten years later the famous all American brand quit America in favour of China and the third world.

In 2001 its workers in Saipan enjoyed an hourly rate of $3.00. Levi Strauss’s CEO Philip Marineau had a yearly income of $25.1 million, amounting to $11,971 / hour.


Price range $8.00 – 19.94

20% of Wal-Mart’s business is conducted in 48 Third World countries outside China. If Wal-Mart was a country it would be China’s fifth biggest export market ahead of Britain and Germany.

A Nicaraguan jeans inspector for Wal-Mart inspected 20,000 jeans each week for an hourly wage of 40 cents. Other workers in the Philippines were forced to work 24 hours straight for the No Boundaries brand. In Bangladesh, children aged between nine and twelve have been found working in Wal-Mart sweatshops. In Honduras children worked up to 13 hours a day for 25 cents an hour sewing jeans which sold for $20.00 in the USA.

Wal-Mart’s official statement on sweatshops states “Wal-Mart strives to do business only with factories run legally and ethically”. Obviously they are not striving hard enough.

Workers who make Wal-Mart products regularly experience health problems and labour violations. Including overtime without pay and wage rates up to 30% below the countries minimum. Wal-Mart will not terminate its contract with any factory even if it is found to have violated Wal-Mart’s own code of conduct. It is only if that particular company fails inspections three times in a row that the contract will not be renewed. With annual revenue of $250 billion Wal-Mart is the world’s largest corporation making up 2% of USA’s GDP.

Are There Any Ethical Companies in the Business?

All of the above has probably left you asking just that question. Two of the following three companies are reported to be American, the other is Canadian; they are fully unionised and genuinely sweat shop free. They are not major brands, in fact you may not have heard of them. As one CEO put it “If we give it to the workers then we cannot spend it on advertising.”

Diamond Gusset Jeans

Union Jean Company

No Sweat


China Blue from PBS Independent Lens:


Levi Strauss & Co:

The Limited Inc:

Tommy Hilfiger:


Sweatshop Alternatives: