Capitalism and Developing Countries
Long ago on this site, I wrote this:
More recently, progressives have turned their economic attention to lesser developed nations. Progressives go nuts on the topic of Globalization. Without tight security, G7 and IMF conferences have and would devolve into riots and destruction at the hands of progressives, as happened famously in Seattle. Analyzing the Globalization movement is a bit hard, as rational discourse is not always a huge part of the "scene", and what is said is not always logical or internally consistent. The one thing I can make of this is that progressives intensely dislike the change that is occurring rapidly in third world economies, particularly since these changes are often driven by commerce and capitalists.
Progressives do not like American factories appearing in third world countries, paying locals wages progressives feel are too low, and disrupting agrarian economies with which progressives were more comfortable. But these changes are all the sum of actions by individuals, so it is illustrative to think about what is going on in these countries at the individual level.
One morning, a rice farmer in southeast Asia might faces a choice. He can continue a life of brutal, back-breaking labor from dawn to dusk for what is essentially subsistence earnings. He can continue to see a large number of his children die young from malnutrition and disease. He can continue a lifestyle so static, so devoid of opportunity for advancement, that it is nearly identical to the life led by his ancestors in the same spot a thousand years ago.
Or, he can go to the local Nike factory, work long hours (but certainly no longer than he worked in the field) for low pay (but certainly more than he was making subsistence farming) and take a shot at changing his life. And you know what, many men (and women) in his position choose the Nike factory. And progressives hate this. They distrust this choice. They distrust the change. And, at its heart, that is what the opposition to globalization is all about "“ a deep seated conservatism that distrusts the decision-making of individuals and fears change, change that ironically might finally pull people out of untold generations of utter poverty.
Which is why I really enjoyed this article linked by Mark Perry:
"Years after activists accused Nike and other Western brands of running Third World sweatshops, the issue has taken a surprising turn. The path of discovery winds from coastal factory floors far into China's interior, past women knee-deep in streams pounding laundry. It continues down a dusty village lane to a startling sight: arrays of gleaming three-story houses with balconies, balustrades and even Greek columns rising from rice paddies.
It turns out that factory workers -- not the activists labeled "preachy" by one expert, and not the Nike executives so wounded by criticism -- get the last laugh. Villagers who "went out," as Chinese say, for what critics described as dead-end manufacturing jobs are sending money back and returning with savings, building houses and starting businesses.
Workers who stitched shoes for Nike and apparel for Columbia Sportswear, both based near Beaverton, Oregon, are fueling a wave of prosperity in rural China.
Update: I would have thought it unnecessary to add these provisos, but apparently per the comments it is necessary for some. Of course people need to be treated as human beings. Companies in some poor countries that are using the power of local government to actually enslave workers or to employ them in non-consensual ways are not organizations a good libertarian would ever defend, as our bedrock principle is to deal with other human beings without force or fraud.
My point is that we cannot apply our wealthy middle class values to the pay/benefits/workweek package being offered in poor countries. To my mind it is immoral to try to deny poor people in poor companies jobs just because we rich people in the US would not consider taking such a job. This arrogant and frankly clueless attitude forgets a critical question - what is their alternative? We may think the Nike factory job sucks, and against the choices we have it probably does, but I would bet the subsistence rice farming job, with one's family always one bad harvest away from starvation, would suck worse. Of course we should aspire that everyone in the world can work in an air conditioned building for $40,000 a year while spending most of the day surfing the Internet and texting friends complaining that they are underpaid. But you can't tell these countries that the only ladder they can use to escape poverty doesn't have any rungs in the first 20 feet.
