HOPE for Haiti? Disaster Capitalism Strikes Again

An AP article yesterday entitled "Can low-paying garment industry save Haiti?" highlights how depressingly hypocritical US commitment to helping Haiti really is.  Using the quake as an opportunity to kick into high gear a plan formulated last year, the UN, Obama administration, and American business community are planning to expand the sweatshop industry as a means of helping Haiti's economy recover from the disaster.  

Yes, you heard that right--more sweatshops to help the Haitian people...typical American solution.  The industry in Haiti currently pays a wage of $3.09 a day, having refused to accept a law last year that had tried to peg the minimum wage at a bounteous $5 a day.  (The clothes sewed, incidentally, are no Wal-mart brands, but sell for $550 a pop at stores like Jos. A. Bank.)  At this wage rate, employees can pay for the barest food and, if they're lucky, shelter, and no more; indeed, they must miss out on the free food handouts that are currently available because they're kept at work all day.  

Nevertheless, Bill Clinton, currently serving as a "special envoy" to the nation, promised that "The rich will get richer, but there will be a much, much bigger middle class, with poor people pouring into it at a rapid rate."  The theory, of course, is that eventually, all these folks will save up enough money from their meager wages that they can spend more, encouraging more industries, and thus more wages, and they'll be able to acquire more skills, and thus command higher wages, and so on.  The problem, of course, is that the wages are so low that nobody has anything left over to save or invest, and the population is so desperate and unemployed that those wages won't be rising anytime soon.  In fact, in the last twenty-five years, real wages have fallen by 50% at these factories!   No one has poured into the middle class from sweatshop work; rather, the poor and desperate have simply sunk even deeper into poverty and desperation.    

Nevertheless, a year and a half ago, the US Congress passed an act called the "Haiti Hemispheric Opportunity through Partnership Encouragement Act" or "Hope II," giving Haitian sweatshops completely tariff-free access to US markets, to try to encourage more US clothing companies to outsource their labor there.  Of course, the lifting of such barriers does nothing to raise wages, but simply boosts factory profit margins, which now average 22%! 

I recall Rerum Novarum's indispensable dictum:

"If through necessity or fear of a worse evil the workman accept harder conditions because an employer or contractor will afford him no better, he is made the victim of force and injustice."