Stellar Mold & Tool, INC

20850 West Gale Ave
Galesville, WI 54630
Tel: 608-582-4118
Fax: 608-582-4492

Mail: wi@stellarmold.com

Stellar Mold & Tool 2015

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Trading Lower Cost for Human Rights

July 21, 2016

 

We are currently facing a devolution movement with regards to globalization. The recent events that led to the “Brexit” referendum and the United Kingdom’s subsequent departure from the European Union, have shown that a populace can still enact change within their own borders. This is despite the fact that many of their elected officials are essentially in servitude to the corporations that rely on unregulated trade. However, it is rare that such nationalist movements offer many benefits outside of the initial feeling of security. In fact, most nationalist movements are breeding grounds for questionable and sometimes even dangerous ideologies.

 

Advocates of free trade and agreements such as NAFTA and the hotly contested TPP have always maintained that free trade is vital for human rights. The benefits to the developed nations coming via lower priced goods made in these less-industrialized nations where labor costs can account for pennies on the dollar. Meanwhile, opponents have maintained that unregulated trade agreements are directly responsible for the mass exodus of manufacturing out of industrialized nations. A process that they assert is directly contributing to four comma deficits and the widening of the equity gap. So, how did citizens, responsible for electing political leaders, become the victims of this issue in the first place? By being sold on a promise of a brighter future and a better world for everyone.

 

“Trade is essential for human rights. Instead of isolating them we make them live by the same global trading rules as everyone else and gain 1.2 billion consumers for our products and strengthen the forces of reform.” - Albie Duncan in reference to trade agreements with China Season 4, Episode 6 of The West Wing. (Character Portrayed by Hal Holbrook)

 

A version of this sentiment has always been the axiom of unregulated trade. Of course, The West Wing was a fictional drama, yet the quote represents a way in which unregulated trade and globalization has been expounded for years. While few of the positive aspects have been proven, the benefits only seem to apply to the developing countries and/or the highest level corporate executives. This leaves the working classes to fend for themselves in a rapidly shifting economy. But rather than simply taking sides, let’s take a closer look at where this belief breaks down.

 

The first sentence, “trade is essential for human rights,” is a powerful statement to make. The idea that these countries, which not that long ago were viewed by the world as violent police states, have now transformed into societies that put their citizens first is irrational. Even the writing of the show was aware of this. The character further expands on the initial statement by saying, “…the end of that sentence is, we hope. Because nothing else has worked.” He then declares, “…Chinese political prisoners are going to be sewing soccer balls with their teeth whether we sell them cheeseburgers or not, so let's sell them cheeseburgers.” The thought of being complacent in forced labor is brushed over with the sort of cavalier attitude that hopefully only occurs in television.

 

The reality however, may be even bleaker. We are heavily invested in our “experiment” with global trade and yet little has been done to improve human rights among our trading partners. The organization, China Labor Watch is an independent, non-profit, that is focused on Chinese workers’ rights. Their website, chinalaborwatch.org, investigates, tracks, and reports on working conditions inside China’s manufacturing industry. The reports contain horror stories concerning: unpaid/forced overtime, vile workers’ housing conditions, unsafe facilities, falsified documents, and even loss of life. By continuing these practices without demand for change, are we not responsible for these violations and the subsequent loss of life?

 

The second line of the statement, “…Instead of isolating them we make them live by the same global trading rules as everyone else,” is where the entirety of the argument falls apart in my opinion. Ideally, we would be able to hold our trade partners to the same standards and rules that we expect of our domestic manufacturing operations. However, the reality is not as simple. While nothing that is as complicated as trade can be expected to have a superlative outcome, the level of environmental, workers’ safety, and human rights violations that have been exposed since expanding globalization proves that leaders on both sides are willing to violate these rules in favor of monetary gain. Unfortunately, the level of quality that is now attainable combined with the lower cost of production is acceptable enough for companies to justify taking their business to these known havens of oppression.

 

The final section of the statement is, “…and gain 1.2 billion consumers for our products and strengthen the forces of reform.” Now, the part about reform is really just a call back to earlier about holding them to the same rules which, we know to be a failed notion. So, let’s look into gaining 1.2 billion consumers. This is the primary reason businesses participate in global trade. The idea of opening up markets to the entire population of the planet is a lucrative undertaking. We build the product in your country, you allow us to sell it in your country. It’s a no-brainer. However, this only works if the trade partner maintains a stringent regulatory process to protect intellectual property. I think most people are aware that few of our trade partners have or enforce these protections.  A quick search of the internet will bring up everything from iPhone clones to entire vehicles that have fallen prey to IP theft. This counterfeit production leads to competing products arriving to market at impossibly low price points contradicting the “gained consumers” argument.

 

So how does all of this relate to the Brexit outcome and the future of globalization? When you remove all of the news media’s talking points based on fear, anxiety, and similar emotional and reactionary sentiments, you are left with a populous that is willing to retract to their “safe place” in an attempt at self-preservation. This can lead to the nationalist sentiments that we are currently experiencing in the political landscapes of nations such as the U.K. and here in the U.S. These movements are traditionally opposed to any free and unregulated trade, along with being breeding grounds for dangerous and poisonous ideologies throughout history.

 

The working classes have experienced very few benefits from globalization and unregulated free trade. Apart from cheaper goods, it seems the only “progress” that is made seems focused on bringing about the end of the middle class. While the introduction of foreign capital into developing nations has raised living and working conditions in places like China, India, and Mexico, it has been slow going to say the least. Meanwhile, workers’ rights across Europe and the United States have suffered in the attempt to keep up with competing nations that have everything to gain.

In the mold and tool industry, we are not talking about losing jobs that just anyone can do. This is not about outsourcing simple production and assembly operations, we are outsourcing an entire trade in favor of keeping initial cost projections lower. This is not a plea in favor of lower profits and increased overhead, it is a declaration of self-preservation. Not only is the American mold and toolmaking industry being guaranteed extinction when the current generation of journeymen retire, they are being asked to make every concession imaginable in an attempt to remain competitive. Not to mention the disturbing fact that we seem to have stumbled onto an acceptable level of intellectual property theft.

 

The practice of unregulated, free trade does elevate aspects of life in developing nations. However, it has also seems to lower aspects of middle class life in nations that participate in this outsourcing. This topic is one that will undoubtedly be a focus of our upcoming election, if and when it moves past the name calling phase. So we seem to be at a crossroads, do we take our cue from Brexit and retract in an attempt to sustain our way of life; or, do we continue down the path of trade induced self-destruction? Or, is there a third option? One where we continue evolving our relationships with developing nations but also include real and fair regulatory measures to stifle the greed based transgressions that damage the current system. Whatever is decided upon, it cannot change what is already known; that we are running a losing race against ourselves to become the lowest bidders.

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