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“Falling Prices” Sometimes Require Falling Buildings — Walmart Refuses Bangladesh Worker Safety Agreement

May 15, 2013

1,127 lives and countingIn the wake of the latest tragedy in a Bangladesh garment factory, pressure from the international community and organizing among garment workers themselves have come together to force change. To combat the dismal pay for garment workers, the country is pursuing a raise in the minimum wage, and will allow workers to unionize. To combat distressingly hazardous work conditions, a legally-biding safety agreement calling for “independent, rigorous factory safety inspections with public accountability and mandatory repairs and renovations” is being signed and underwritten by global retailers.

So far, numerous European retailers, including the largest customer for Bangladeshi garments, Swedish brand H&M , have signed on. American companies are somewhat less enthusiastic.

After six major European retailers announced on Monday and Tuesday that they would sign onto a broad safety upgrade agreement in Bangladesh, American companies Walmart and Gap announced that they would not sign on. (ThinkProgress)

Why? The obvious answer is money. But according to analysis by the Worker Rights Consortium, if all costs of upgrading Bangladesh factories were passed to consumers the cost would be about 10¢ per item of clothing. Seems like a pittance, which consumers wouldn’t even notice. The Gap company has actually come up with a much more creative excuse:

By far, Gap has been the most vocal company opposed to the plan, expressing concerns that overzealous American lawyers could seize on the agreement to sue American companies on behalf of aggrieved factory workers in Bangladesh — perhaps in the event of a factory fire. Gap said it supported much of the plan, but it proposed changes that would greatly limit any legal liability for a company that violated the plan. (NY Times)

Never forget that only part of the appeal of producing garments overseas is cheap labor, the other part is the complete absence of legal accountability.

For their part, Walmart has their own, voluntary and not legally binding, plan.

Walmart cited “requirements, including governance and dispute resolution mechanisms” in the agreement as its reason not to sign on, saying they are “appropriately left to retailers, suppliers and government, and are unnecessary to achieve fire and safety goals.”

The company plans to instead use its own safety plan. […]

Labor groups criticized Walmart’s plan, which is voluntary. The broader plan signed by the other companies is legally binding. Labor groups characterized Walmart’s proposal as merely aspirational.

Again, this is much the same argument as Gap. Walmart is protesting the inclusion of some basic worker rights and dispute resolution as superfluous to making factories safe. This is the same desire to be shielded from legal responsibility. Apparently, it’s the American way. As European brands continue to sign on to the agreement, including Bennetton and Marks & Spencer Tuesday, only one American company has joined: PVH, owner of Calvin Klein, Tommy Hilfiger, and Izod.

The death toll from the factory collapse is currently at 1,127. The count from November’s factory fire was 112. Within the last week, another Bangladesh fire claimed 7 more lives. The cost in lives is staggering. And it is fueled by the American appetite for cheap clothing. A recent Wall Street Journal report did some eye-opening analysis:

“Americans last year devoted just 3% of their annual spending to clothing and footwear, compared with around 7% in 1970 and about 13% in 1945, according to Commerce Department data.” Spending has decreased in part because clothing prices have fallen over the last two decades after rising from the 1950s to the 1970s. Prices for clothing have risen just 10 percent since 1889, while food prices, in contrast, have gone up more than 80 percent.

So average Americans out for a bargain are to blame? I’m not saying that exactly. It’s true we all need to be more cognizant of the purchases we make. Cheap clothes tend to be  disposable clothes which are bad for the environment and misdirect resources that could otherwise go to feed a hungry world. But the American appetite for cheap clothing is fueled less by an addiction to trendy fashion than by shrinking household budgets. Clothing is one necessity for which Americans have been able to reduce their budget. Ironically, this is due to the siphoning of wealth away from the middle class to the top 1%, many of whom are enriched even more through the profits of companies like Walmart.

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One Comment leave one →
  1. mikey2ct permalink
    May 16, 2013 2:52 pm

    Of course it is money!

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