Thursday, August 30, 2007

In (sort of) Defense of Sweatshops

Today was the first day of classes, and my Econometrics professor started the term off with a NYT's letter to the editor, responding to a report on an econometric study that can determine the quality of a wine without any more data than the weather reports from the year.

Basically, the letter to the editor said that wine quality is too difficult to be determined by an economist, who are all cold and out of touch with reality. My class lamented together for a moment, thinking of all the persecution we, as students of the dismal science, have faced.

One persecution I have faced for an argument I could never win, nor any economist ever could, is one on the benefits of sweatshops.

I have only dared to make this argument a few times, and have quickly been silenced by my own sense of guilt and social norms. Yet, anyone who has taken an Intro to Development Economics course knows how the pro-sweatshops argument goes:

Third World countries have a comparative advantage in cheap labor. People in Third World countries need money, and any job is better than no job. Work will be hard, but money start to flow in to the economy and eventually the working conditions will get better. Then same thing happened in the US.

And the counter-argument:

Sweatshops are forced on to people, and the capital injection that they provide are only temporary, as many transnational corporations will pick up and leave when the wages get too high.

And on, and on...

An op-ed piece in the NYT today tallied up one point for the sweatshops. It was written by Dana Thomas, taken from her new book "Deluxe: How Luxury Lost Its Luster," which I am very excited to read, as soon as it comes out in paperback. The op-ed was about the dirty deeds behind counterfeit purses, and it narrated her going and freeing young children in China from sweatshops manufacturing fake purses.

She said that as she left, these children "threw bottles and cans at us. They were now jobless and, because the factory owner housed them, homeless." Sweatshops are in no way sustainable, but this glimpse into one shows that a solution to sweatshop labor is not as easy as shutting them all down.

Another NYT's piece reported yesterday that wages in China (seemingly the poster-child for sweatshop labor, if you want to call it that) have increased by a significant amount in the past few months, in some cases almost doubling. Employers are having a difficult time finding employable people willing to work the hours and at the pace their "factories" require, causing wages to rise. Another point for sweatshops. (To be fair, Thomas mentioned that counterfeit-purse-factory workers make less than half of what normal sweatshop workers make.)

As I said before, sweatshops are in no way sustainable. I do not even think, at the level they are operating currently, they are a stepping stone to bigger and better things for Third World countries. But when reading about those children that threw bottles at their supposed "liberators", I remembered that stopping sweatshops and all the evils they impose is not as easy as knowing where your shirt came from. You need to know why it came from there, why you paid what you did, and what happens if you don't buy a shirt from there again.


Note: Check out this op-ed from Grinnell's own S&B, by the professor I mentioned in the beginning of this post, to hear some more arguments for sweatshops. (You have to get the bottom half first.)

Monday, August 27, 2007

What do foreheads and cars have in common?

I have always been fascinated by advertisements. I remember watching TV once with a friend, and I found myself yelling at the commercials for being stupid and pointless. My friend turned to me and said; "If you're going to get frustrated at every ad you see, you'll be in big trouble."

This morning's NYT proved his point. There was an article in the Media & Advertising section called "Your Ad Here, on MY S.U.V.? And You'll Pay?" It was about how businesses are beginning to pay ordinary people to drive around with ads on their cars. It reminded me of the person who auctioned off his forehead for tattoo-ad space.

Apparently, these forehead-billboards are not uncommon (type in "ad tattoos" to Google, and you'll see what I mean.) And, apparently, these car-billboards are not uncommon either. The article reports ten of thousands of people have participated in this form of advertisement, called "car wrapping". Companies offer an $800 stipend for this service, so getting a new paint job in the name of marketing is hard to refuse.

I can understand why a company would place their ad on an everyday car, the NYT reports that a single "car wrap" will be seen 70,000 times a day. And I know companies are looking for unique advertising space, especially since the invention of Tivo and satellite radio.

But I am reminded of the concluding comments of Malcolm Gladwell in The Tipping Point. He talked of "ad saturation", the concept that at some point, people can become saturated with ads and begin to ignore them completely. He argues that this "tipping point" for advertisements has already occur, and creating more ads, for any product, will only decrease the incentive to buy.

Obviously, the people paying to wrap a car with their product's message do not think this is the case. Back before the average American saw more than 600 ads in a day, more advertisements meant more exposure. If someone saw a Coke commercial on the six o'clock news in the Sixties, that might influence their next decision to buy a beverage. Now, seeing a Coke ad is a part of everyday life. It doesn't sway my decision one way or the other, and I would doubt if it did for anyone else.

When learning about classical conditioning in Intro to Psych, our professor explained that most marketers do not take into account human psychology when designing ads. As I begin to see more and more ads every day, and get more and more frustrated, I have to believe he is right.

Wednesday, August 22, 2007

Being un-American

Yesterday I remarked to my friend that this past summer I've slowly turned into a Socialist. I may or may not have been kidding, I still haven't decided, but one thing I am sure of is that I fully support universal health care for this country, and all countries.

That's why I was infuriated to read the today's NYT article, "Many Eligible for Child Health Plan Have No Idea." It reported on the fact that 1.7 million children that have qualified for the State Children's Health Insurance Program are not enrolled and are unaware of their eligibility. This is a disturbing figure, but what I found more disturbing were the small tidbits of information dropped into the article about the Bush administration's attitude towards expanded health care coverage.

Last week, the article says, the administration set new standards to discourage the expansion of state-run health care to children of middle-class families. Bush has threatened to veto bills in the House and the Senate that add billions of dollars into health care coverage of children because both are a "major step toward nationalized health coverage." The administration's main reason against this funding increase is that
the expansion...would transform the program into a broad entitlement. Many families, they predict, would cancel private insurance in favor of government coverage (one study found that 14 percent of enrollees did).

It seems like Bush is forgetting that the president should keep his or her citizens' best interests in mind. If people prefer universal health care, then the president should deliver universal health care. Bush, and many others in Washington, have politicized health care, making it "un-Republican" and "un-American" to want universal coverage. Most people realize there is a health crises in this country. It is just too bad those enlightened people don't run it.

Saturday, August 18, 2007

We're Missing Out

I remember a conversation in my intro Sociology class about a year and a half ago. We had just read an article about the AIDS epidemic in Africa (Time, Feb 2001). We were discussing AIDS as a social epidemic, rather than just a medical one. Someone mentioned that African people would never be able to emerge as a competitive group in the global economy, because they are are plagued by so many social, economic and medical problems.

I responded to this comment with a blindly optimistic rebuttal, saying that Africa will not only become a major trading partner in our lifetime, but that the US should begin to invest in Africa before missing out on this opportunity. Africa as a continent has great potential for economic growth. The US can benefit from African consumers, just as Africans can benefit from our investments. I've always thought Africans would soon emerge as a powerful consumer base and that the US should figure out a way to capitalize on this inevitable trend while there still is time.

Today, I learned that we might already be too late. Or, at least, behind the times. Not surprisingly, the country to beat us to this was China. Today's New York Time exposé, "Entrepreneurs From China Flourish in Africa", profiles several Chinese entrepreneurs seeking out their fortunes abroad. What makes these business people different from other ex-patriots is that they travel to Africa, instead of Western nations.

China is not the only country taking the African consumer seriously. Since 1955, there has been a strong relationship between African and Sino countries. (See the Bandung Conference.) South-south linkages, as they are commonly called, might be the only hope to lift Africa out of the quagmire it is in. What is so great about these south-south trade relations is that not only to Africans benefit from capital injection, but its done on economic turns, not as a handout.

I am not suggesting that we all leave to start businesses in African nations. I am not even suggesting that all Africa needs is foreign capital and investment. All I am saying is that this migration of Chinese is just illustrative of a larger trend. China, as well as other industrializing countries, sees Africa as an investment, not as a charity case. The more I learn about US-Africa relations (or even Western-African relations), the more disappointed I become. It is a shame the US is missing out on another great opportunity.

Thursday, August 16, 2007

Exporting Markers

Yesterday, I had a brief conversation with my mother about my upcoming fall semester in Botswana. She said she wanted to buy a lot of markers and pencils at Target before I left, so I could distribute them to the needy children and needy schools I would encounter on my travels. She was well-meaning, of course, but I quickly refused her offer and tried to explain why her suggestion was a bad one.

I give the One Campaign a lot of crap, and I will continue to do so with this post. I think things like One have made people like my mother think getting needy children supplies is as easy as buying them cheap at Target and getting someone to distribute them. One's "twelve cent medicines" make it seem like all it takes is a check and connections to solve all the world's problems.

My mother's suggestion for me to bring markers to Botswana would be like bringing Pop-Tarts to a starving community. These potential Batswana children may need school supplies, but we can't just assume help is as easy as giving away what we personally think someone might need. If I show up with a suitcase full of markers, and what they really need is paper, then I'm stuck with markers that could more efficiently be used elsewhere.

Another, more complex reason that I would not like to import markers into Botswana is because it takes away from local economies. In my opinion, Botswana needs my and my mother's money more than a U.S. Target does. By waiting to see what the Batswana people need until after I arrive, I am not only able to effectively deliver what they need, but also purchase those things in the community and stimulate the local economy.

Today the New York Times reported on CARE refusing to accept 45 million dollars of food aid from the U.S., "CARE Turns Down Federal Funds for Food Aid". CARE is one of the world's largest charities and usually sells donated food from the U.S. to finance anti-poverty programs. It is also the first NGO, that I know of, to have refused a donation that large.

CARE claims that these cheaply-produced and -sold crop donations stagnate growth by deflating local primary product prices. I agree with them, but many would disagree. Some see this price deflation as a necessary evil; without these crop donations, groups like CARE would not be able to function and help the thousands of poor farmers in the same way as they do now.

My mother was distressed when I explained to her the problems with importing markers to Botswana, and by extension, importing primary products as aid. She asked me what she could give me instead of markers. I asked her what she had.

"Well, how about Beanie Babies?" she said.

"Yeah," I responded, "Those would be great."

"Why? Why are Beanie Babies any different? How do you know they need Beanie Babies in Botswana and not markers?"

"Mom," I said, "no one ever needs Beanie Babies. Beanie Babies are always superfluous."

Thursday, August 9, 2007

What Aid Really Is

Today I read Nicholas Kristof's column, "Bono, Foreign Aid and Skeptics". He presented the complexities of aid relief well, and was careful not to gloss over any of the issues. I would consider myself one of those skeptics of direct foreign aid, due to the rock-n-roll economics that some of its policies are based on, but I found myself agreeing with much of what Kristof said.

That is, until I read the following passage:

...when we pay a few hundred dollars for fistula surgery so that a teenage girl no longer will leak urine or feces for the rest of her life, that operation may not stimulate economic growth. But no one who sees such a girl’s happiness after surgery can doubt that such aid is effective, for it truly saves a human being.


As a liberal-minded economics major, I found this appalling. Not the part about aid creating happiness and therefore being effective, but the seemingly innocent statement that a surgery like this "may not stimulate economic growth."

This surgery will most definitely stimulate economic growth. Most would look at this act of aid as a handout, but I see it as an investment in human capital. By creating a better life for this teenager, and substantially lengthening it, this person is free to live as she pleases, while participating in the local and global economy.

People do not like to think of human life in potential dollar amounts, but I think it is necessary when dealing with the type of people that run our world. If people continue to look at aid as charity for helpless, destitute people half-way around the world, it will never effectively solve problems. Aid cannot be useful until it is seen for what it really should be, an investment in humanity and therefore the global economy.

Note: I submitted these comments to Nicholas Kristof on his blog, On the Ground. If he responds, I will post it here.

Sunday, August 5, 2007

8/1/2007

Yesterday I spent a few minutes on the balcony of the Guthrie Theater in Minneapolis, looking out over the Mississippi River. To my right, I could see the remains of the 35W bridge. Even if you don't live in Minneapolis, you've probably seen the images of the wreckage in the paper or on TV. To me, everything looked smaller. It was drizzling and everything seemed quiet. There was nothing moving on or around the area, the rescue operations had stopped for the rain. The only people I could see were the theater goers next to me. This was a bridge I've traveled on hundreds of times before, but never once noticed it. As my dad told me, it was a bridge most didn't know was there.

My friends are beginning to call it "the ground zero of Minneapolis." It is fitting, as the collapse has changed this town forever, although for different reasons than the ground zero in New York. The fall of the towers symbolized an outside attack on our way of life by the extreme hatred of a small group of people, and the collapse of the bridge here symbolizes the slow crumbling of our society, caused only by negligence and apathy towards ourselves and others.

President Bush was nice enough to pay this city a three hour visit yesterday. As I remember, this was his first visit to Minneapolis in a long time. Congress continues to dish out money to the Minnesotan government, and the last I heard the figure was around 250 million. However, during Bush's brief visit, he told Mayor R.T. Rybak and other representatives that he would "make no promises on the timetable" for the rebuilding of the bridge. Sounds familiar. (See the Minneapolis Star Tribune article about his visit here.)

Bush's attitude during his visit is similar to his attitude during his other visits to disaster sites. When one survivor told the story of how he saved himself and then helped to bring a bus load of children out of the wreckage, Bush replied with; "Great job." Obviously, nothing has change within the nation's infrastructure since the "Heckuva job" done in New Orleans and Bush's attitude towards his constituents' problems hasn't changed either.

Also in the Star Tribune today was a column by Ann McFeatters, "Save now, pay later- and how". It was not until I read this that I realized how many infrastructure problems the US has had recently. She lists them off: Katrina, blackouts in the North East and around the country, a Hawaii dam collapse, sink holes in Brooklyn, and the 13,000 deaths a year that are related to improper highway maintenance. I'm sure there are hundreds of other minor, but significant cases around the nation that don't get national attention.

When McFeatters lists these catastrophes off, it seems as if the US is going through an epidemic. One of my family friends was hit hard by the bridge collapse, not because she was involved in it, but because of what it meant to her. She is concerned that these infrastructure failures signify the beginning of the end for our society, in the same way the Roman Empire fell due to their lack of concern with their crumbling infrastructure. This might be a little bit of paranoia, but ever since last Wednesday, I've started to wonder if it is just history repeating itself.

The 35W bridge collapse is another betrayal from the US government to its citizens. Even in a post-Katrina society, disasters can still occur which leave government officials pointing their fingers at anyone but themselves. To continue to be a leader in the global village, the US must once again become concerned with its citizens' wellbeing. If people cannot trust the country they live in, then falling bridges and sinkholes will soon become the least of the government's problems.

Thursday, August 2, 2007

Bipartisanism Rising

Before I start, I would like to acknowledge that the 35W bridge collapsed yesterday over the Mississippi River in Minneapolis, my hometown. It is a tragedy, and this city will never be the same.

If you have happened to glance at the New York Times business section in the last few weeks, you will probably have seen an article about Rupert Murdoch buying the Dow Jones Company and the Wall Street Journal. Murdoch is the owner of News Corporation, which includes Fox News. The purchase of the Wall Street Journal has made people anxious about it turning even more conservative, similar to Fox.

Fox is known for its conservative leanings, just as CNN is known for being liberal. Yesterday, my Aunt Joey forwarded me this image from the New York Times, documenting how many minutes of interview time has been dedicated to each presidential candidate on each major news station from the beginning of the year to July 15th.

Most of the results displayed by the image, which is from the Hotline, are not surprising, but some are interesting. Senator Barack Obama had no interview time on Fox News, and neither did Senator Joesph Biden, even though they are in the top three for most interview time among Democrats. Senator John McCain had the most time total, and the most of his time was spent on NBC, not the conservative Fox. Out of ten Republican candidates, five had most of their interviews on Fox. All of the Democratic candidates had the most time on either CNN or MSNBC, with the exception of Senator Hillary Clinton, who spent most of her time on ABC.

What I think is most interesting about the image, and which my Aunt Joey altered me to, is the fact that Senator Clinton is twelfth on the list, below Tom Tancredo and above Dennis Kucinich. Clinton is the democratic forerunner with Obama, yet she doesn't receive nearly as much time as Obama, or even Tancredo, who isn't even close to the presence Clinton has. Joey speculated that this might be because she is a women, or by choice, and it is interesting to think about.

Anyways, back to my original point. Joey also forwarded me an email for the Edwards campaign, discussing how Edwards has refused money from Murdoch and his affiliates, and is calling for other democrats to follow him. This public statement is in response to what the e-mail calls the "right-wing talking points and temper tantrums" of Fox.

I agree with Edward's statement, and I think he, as well as other Democrats, need to respond to Fox's (and by extension, Murdoch's) attacks against them. As can be seen by the New York Times image, Fox does have a slant. But the image also shows the slant of CNN and MSNBC.

Partisanship goes both ways. Edwards is responding to the bias of Fox, but by doing so, he is strengthening that bias. He needs to go on Fox and refute their "temper tantrums" against him. Other Democrats and Republicans need to do the same on their respective nemeses.

Of course, that's easier said than done. In my opinion, Fox does close out certain people from their broadcasts, and makes it hard for people to respond to their negative claims. I think CNN is better at eliminating biases, yet it was the network that brought us Crossfire, probably the most partisan and polarizing show in television history. Jon Stewart was brave enough to say what he though about Crossfire, and defend his opinions on the show. (If you haven't seen the clip of this, I would recommend it. I think it is one of the best moments in recent media history.)

In a perfect world, these presidential candidates would be able to go on Fox (or CNN or MSNBC or ABC) and challenge what has been said about them. However, networks can make that difficult, and most candidates don't have the time to fight for their opinions, especially because they can just go on another new network and spit out opposite talking points.

But those who watch these talking points that increase bipartisanship can realize that this battle between two seemingly polar opposites is nothing more than an shallow reflection of the real world. Even though these people make our laws, every belief they hold does not represent our own. Even though I may be a Democratic, I do not agree with every thing that Edwards or Obama or Clinton says, or everything a CNN anchor reports. And even though you might be a Republican, you don't have to only watch Fox as a source of news. This isn't a perfect world, but at least we can understand that.