Thursday, September 20, 2007

Out of Whole Cloth

Last Friday, a report entitled, "Let's Clean Up Fashion," was published, criticizing the high pay that chief executives of some fashion firms receive. The report contrasts these sums with the low wages paid to overseas workers, in poor countries. Two advocacy groups, War on Want and Labour Behind the Label, claim that most well-known clothing companies are not doing enough to make sure that factory workers overseas are lifted out of poverty. They also claim that overseas workers who make the clothes sold in the leading British fashion retailers are not paid a "living wage."
There's one big problem with these claims. The living wage being used as a yardstick is the British living wage. These workers don't live in Britain. The UK is one of the most expensive nations in the world in which to live. Low level wages in the UK are about double what they are in America, for example. However, since just about everything here is twice as expensive as in the States, low level workers, here, aren't any better off.
Then these idiots compare the £3 million fee paid to model Kate Moss for coming out with her own fashion line, for Topshop, with the earnings of the workers in Mauritius who make the clothes. The factory workers, there, take home £64 per month. They also compare the earnings of the CEOs for the largest supermarket chain in Britain, Tesco, and department store chain, Marks and Spencer, with garment workers in Bangladesh and Sri Lanka. Are these advocates idiots, or do they think we are? If you compare the wages of the petrol station attendant, in London, with the CEO of any major oil company, the Company director will, of course, be earning much more.
The workers in these third world countries are happy to get the wages they are getting. If these jobs didn't pay more than the alternatives open to them there, they wouldn't take them. Demanding that companies pay these folks the same as workers in Britain earn will just result in more expensive clothes for the poor in Britain and/or the jobs being eliminated all together. I wonder which is better, £64 per month in Mauritius, or £0 per month? In a free market, real wages rise to the marginal level of productivity. If these meddling twits really want to help the poor abroad, they'd campaign to eliminate barriers to migration and trade. Freeing up the markets will, in time, raise the standards of living for people in poorer countries. Until they wise up, I wish the advocates would "put a sock in it."

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