Monitoring Sweatshops: Workers, Consumers, And The
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Paying a dollar or so an hour to sweatshop workers to build these phones still leaves huge profits for the manufacturers. In the early part of the 20th century, American automobile manufacturers increased their profit margins by hiring ethnic labor from the American South and paying those workers three-quarters to half of what their Anglo counterparts were making. This resulted in escalating racial tensions in the North and the 20th-century revival of the Ku Klux Klan. Can manufacturers provide safer conditions with better pay in sweatshops? Can some of those jobs return to the United States with the manufacturers agreeing to be satisfied with lesser profit margins and without sacrificing the quality of the product or without raising the price?
This question is being directed at spiritual leaders regarding the economic practices of corporations that hardly concern themselves with moral or spiritual laws. Human laws they are very interested in, since the violation of those can quell production and incur hefty financial penalties, so the most we can do here is speak from our own traditions and hope there is a listening ear in the world of industry. Perhaps this is what must be emphasized with these corporations that seek only the bottom dollar to maximize profits at all of our expense.
Maybe the floor sweeper earns less than those soldering circuit boards, but none should remotely consider their employment a death sentence. These incidents hold us accountable. Where do our clothes come from? Where does our food come from? We — and I fully confess my own complicity — live in an unfaithful ignorance and can be happy to do so. When factories collapse overseas, recalling a similar tragedy in this country more than years ago, we see with sadness that morally bankrupt conditions proliferate across the Global South.
I was inspired to explore the Worker Rights Consortium website and see how universities have collaborated to monitor and change working conditions in factories around the world. Sweatshops stop proliferating when consumers shop with awareness and support organizations that actively publicize bad management and pursue improved conditions.
Awareness starts at home and spreads across the globe. The continuation of such inhumane working conditions into the 21st century is inexcusable.
There can be no reason to treat fellow human beings this way, let alone for the sake of saving a few dollars or euros to maintain our extravagant Western lifestyles. We should feel a sense of shame for creating an environment so fixated on cheap consumer goods that it sets the stage for these tragedies.
When properly regulated, capitalism can be a remarkable tool for common prosperity. The free market system has created unprecedented health, wealth and positive living standards in the United States, the European Union and beyond. Our economic structure has enabled America to become a beacon of opportunity for others and given us the strength to be a worldwide force for good. However, the fact is that the needs of wealthy societies are often met at the expense of other less fortunate nations.
Because they offer cheap labor and abundant raw materials, many third-world countries are vulnerable to exploitation; they present ripe opportunities for unscrupulous businesses. We must remain cognizant of this and strive to never take unfair advantage of poorer nations.
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I believe our society has an ethical responsibility to start categorizing clothing to make it clear whether slave labor was involved in the manufacturing process. For decades, we have implemented standards for the food industry to ensure the humane treatment of animals — can we do anything less when it comes to regulating industries that rely on the labor of our fellow human beings? There is an expression that people can vote with their feet.
In the case of sweatshops, people can vote with their pocketbooks. The point is, if sensitive consumers really are concerned about the rights of others, even those in other countries, they can try hard to be sure that they are not patronizing businesses that use sweatshop labor. The problem is, of course, that we all like a good deal, and we all want to pay as little as possible.
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So my advice would be to get involved with those groups that try to stick up for sweatshop laborers and learn as much as you can about the whole issue. Also, be prepared for the complexity of the modern world. One store may feature products made for a decent wage in one department and in another part of the store sell sweatshop items. Businesses exist to make money. Wall Street demands higher profits each quarter, otherwise stock prices tumble and chief executives lose their jobs.
Retail businesses know the consumer is fickle and will turn to a competitor on a whim. As a result, they keep costs and prices low. While this may be a broad generalization, I believe it is largely true. Hence, large increases in labor costs do not require correspondingly large increases in retail price.
And this is assuming, as Bruce Rockowitz does, that manufacturers and retailers would pass the extra cost on to us. The assumption might have been valid in the time of Adam Smith. In the eighteenth century there were many small capitalists competing with each other; any savings they made in production, either by cutting wages or adopting new technologies, they would use to reduce prices and undersell their competitors. But as leftist economists Paul Baran and Paul Sweezy showed almost 50 years ago in their book Monopoly Capital , pricing methods are very different now.
Instead, they started holding prices steady while increasing sales through other means, with an emphasis on marketing. Companies occasionally revert to the practice of underselling their rivals, and they often take advantage of new technologies to cut prices and generate an increase in sales, as has happened with personal computers since the early s. The price of a commodity is set by a complicated formula with many different factors, and labor costs are often a minor one.
To get a sense of the relative importance of labor costs, we just need to look at advertising. They estimated that spending on advertising was equal to 5. In other words, the cost for advertising the clothes can be as much as five times the cost of stitching them.