Mr. John Oliver, Host
Last Week Tonight
Dear Mr. Oliver:
You elicited lots of laughs while criticizing Wal-Mart and other retailers for selling clothes made in low-wage sweatshops. It’s true that pay and work conditions in third-world factories are awful compared to pay and work conditions in first-world workplaces. Yet not once while galloping on your moral high-horse did you pause to ask what are the third-world workers’ alternatives to the factory toil that you self-righteously denounce. Does it not occur to you that the reason workers choose to work in such conditions is that those conditions are better than all available alternatives? Do you not realize that putting an end to such sweatshop work would condemn most of those workers – adults and children – to even lower pay and to even worse work conditions?
Of course, because I’m a free-market economist you’d expect me to make such claims – another example of which is this: “The wages of those [sweatshop] workers are shockingly low but nonetheless represent a vast improvement on their previous, less visible rural poverty.”*
And this: “While fat-cat capitalists might benefit from globalization, the biggest beneficiaries are, yes, Third World workers. After all, global poverty is not something recently invented for the benefit of multinational corporations…. Workers in those shirt and sneaker factories are, inevitably, paid very little and expected to endure terrible working conditions. I say ‘inevitably’ because their employers are not in business for their (or their workers’) health; they pay as little as possible, and that minimum is determined by the other opportunities available to workers. And these are still extremely poor countries, where living on a garbage heap is attractive compared with the alternatives.”**
And this: “Yet sweatshops are only a symptom of poverty, not a cause, and banning them closes off one route out of poverty. At a time of tremendous economic distress and protectionist pressures, there’s a special danger that tighter labor standards will be used as an excuse to curb trade. When I defend sweatshops, people always ask me: But would you want to work in a sweatshop? No, of course not. But I would want even less to pull a rickshaw. In the hierarchy of jobs in poor countries, sweltering at a sewing machine isn’t the bottom.”***
These quotations, by the way, are from those infamous corporate-apologist knee-jerk free-market libertarian Rush Limbaugh-loving ideologue devotees of Milton Friedman and Ayn Rand: Paul Krugman and Nicholas Kristof, two columnists for that stridently conservative pro-corporate and anti-worker rag, the New York Times.
Donald J. Boudreaux
Professor of Economics
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030
* Paul Krugman, “We Are Not the World,” New York Times, Feb. 13, 1997
** Paul Krugman, “In Praise of Cheap Labor,” Slate, March 1997
*** Nicholas Kristof, “Where Sweatshops Are a Dream,” New York Times, January 14, 2009
P.S. You should also check out Benjamin Powell’s 2014 Cambridge University Press book, Out of Poverty: Sweatshops in the Global Economy.