Archive for the ‘ Labor ’ Category

Made in China–ahem, Italy

The tragic fire at a factory on Sunday, December 1st, 2013, which cost 7 employees their lives, has barely begun to shed light on the industry’s illegal insurgence and Italy’s lack of capacity to do much about it.

Credit: wantchinatimes.com

Pronto moda is a case of what The Economist tags as “reverse globalization.” Cheap materials are shipped from China to Italy–as are the workers, as are the sweatshop concept and conditions. One city, Prato, just northwest of Florence, plays host to over 5,000 factories like the one that burned down on Sunday and some 50,000 Chinese workers buried in 16 hour work-days. Faux-designer products are pumped out at superhuman rates with the facade of labels from designer brands (although the “Made in Italy” label remaining true) and are sold for extremely cheap prices to locals and tourists. Before Italian taxes can even make their claim, more than half of the $2.7 billion profits find their way back to China undeclared.

Chinese utilitarianism and black labor practices are brought to Italy to take advantage of the necessarily perfect combination of an apt market for the pronto moda scheme and weak rule of law in Prato (as what may be an indication of the weaknesses sustained at the national level; consider Rule of Law 1 and Rule of Law 2 to observe Italy’s troubles). Workers, essentially indentured servants, are likely to be left with their promises of a return back to China unfulfilled as they work, bathe, eat, and sleep (in cardboard accommodations as was the case for the victims) within the same few square meters.

The devastating event made headlines in international media; however, the problem for Italian officials isn’t anything new to them. Roberto Cenni, Prato’s mayor, claims that they investigate hundreds of the 3,000+ illegal business every year. The proliferation is too much to handle, he claims, and the operations that Italy is able to shut down only sprout back up the next year. As China merely renders, capitalizes, and improves on what domestic organized crime has done in the country for so long, Italy is forced to drastically improve from the inside-out if it is to have any chance at beginning to address the complicated issues at hand in Prato.

Advertisements

Citigroup writes bill and history (which is now set to repeat itself)

Credit: usnews.com Silver linings are only hard to come by depending on which side of the spectrum you’re on.

After passing Dodd-Frank in 2010 and letting Wall Street go with a mere slap on the hand and a “Don’t you ever do that again,” United States Congress passed a bill to enable Wall Street to do just that: repeat history and endanger us with another crisis due to egregious financial management.

Passing  292-122 votes, the Swaps Regulatory Improvement Act reverses the portion in the 2010 agreement that restricted Federal Deposit Insurance Corporation (FDIC)-insured funds from being invested in high-risk “swaps” also known as derivatives, the same type of investments that brought down banking giants like Bear Stearns, AIG, Lehman Brothers, Washington Mutual, Wachovia, and countless others. Aptly interpreted by dailykos.com, this means that, “In short, this bill socializes risk (we all pay for their gambles if they fail) and privatizes profit (they gain a whole lot with very little risk because of your guarantee).”

To ask, “How does Congress get the nerve to write such a bill?” would be an inaccurate question. Citigroup, in fact, is responsible for having written 70 out of the 85 lines in the bill. The financial giant is again able to afford such extracurricular activity on Capitol Hill thanks to a $45 billion dollar bail out after the first go-’round. Still, Congress summoned the courage it takes to copy and paste (changing merely two words from singular to plural in two of the most essential paragraphs) during the writing process and voted for it, indeed, overwhelmingly so!

Nearly six times as much money, $22.5 million to $3.8 million dollars, were given to members who voted for the Act according to a Maplight report. History is poised to repeat itself should Too-Big-To-Fail again be tested. And why shouldn’t it? It’s not their risk that is at stake, only our risk for their gain.

Examining the German and Californian shifts on immigration

International Organization for Migration sign promotes the benefits that immigrants bring.

International Organization for Migration sign promotes the benefits that immigrants bring in front of the UN building in New York. Credit: internationalcomparisons.org

“Kinder statt Inder” or “Children before Indians” was reverberated throughout Germany pervasively in both policy and public attitude only a decade ago. Since then, Germany’s success at withstanding the financial crisis has brought about a good problem, albeit one that requires a shift in such policy and attitude. Germany’s joblessness and decline in overall population has required it to look elsewhere than domestic means in order to fill gaps in its labor force.

In a relatively abrupt 180 degree turn, Germany has welcomed over 33% more immigrants in 2011 than 2010, attempted to ease the adaption process socially by providing language lessons, and have reduced the required financial requirements like minimum salary.

Germany is hardly experiencing a change of heart. The shift comes from certain political motives and not necessarily humanitarian benevolence.  Meanwhile in California, although the impact is yet to prove as profound (especially from the national front), considerable victories have been accomplished just this past week.

While Washington waffles on immigration, California’s forging ahead. I’m not waiting.

California Governor Jerry Brown sweepingly signed immigration bills one after the other last week in an effort to demonstrate to Washington that, outside of President Obama’s Deferred Action for Childhood Arrivals (DACA) from summer of 2012, it will neither lean nor wait on Washington to make demonstrative moves toward immigration reform. DACA has provided some foundation by applying prosecutorial discretion to all cases concerning the children of parents who have immigrated illegally. This has opened the door for states to grant certain liberties to immigrants, and Governor Brown is taking full advantage.

In his first move he granted immigrants the ability to obtain driver’s licenses. Since DACA, the number of states that have allowed driver’s licenses to immigrants has jumped from three to eleven.

He also signed a refined version of the TRUST Act after it easily passed through the state Assembly and Senate. The TRUST Act limits detentions to only those who have committed felonies, not misdemeanors. The TRUST Act is a direct response to the Secure Communities program which was originally intended to remove the most dangerous immigrants with a criminal history. The program, however, has been criticized for removing immigrants with petty misdemeanor charges as well.

Also signed were bills to limit an employer’s ability to threaten to report their immigration status to authorities. This gives the concerned employee more ability to handle wage issues, abuses in the workplace, and to work in an overall better environment according to an LA Times article.

Still another bill has been passed to disallow ones immigration status as a hindrance to becoming an attorney in the state of California.

With his hands more or less tied in Washington, President Obama has no other choice after seeing his Dream Act fail miserably but to resort to relatively quiet measures like DACA and depend on states to take charge from there. California has done just that. Unlike Germany where the motive has been ulterior politically and economically, California truly stands out as it achieves these steps toward immigration reform for the sake of the immigrant, himself.

Germany: country profile

Dave Johnson in his article, “Germany’s Economy Shows Government ‘Interference’ Works,” makes a valid point that the United States’ reluctance in making adjustments within the market has further solidified the exclusivity and position of the upper class. The true interference, Johnson holds, is the manner in which the larger businesses in the United States inhibit productivity and competition from smaller companies. Johnson exerts Germany’s system as an exemplary remedy. Germany’s cohesion between the government and the labor force has sustained Germany as an exceptional economic case even during a time in which most economies struggle to stay afloat. To Johnson, there is an apparent connection between Germany’s esteemed productivity and its health care, higher education, child care, and pension systems. Germany has sustained higher wages for employees, closer union ties, and closer cooperation between the industry and government sectors. Johnson implores his readers to consider Germany’s case carefully and to compare it to our case here in the U.S.

Highlights to the reasons for and benefits from Germany’s economic success are outlined below:

  • Industrial development policy that favors some manufacturing over others. The government is currently helping promote green manufacturing, for example.
  • Very high worker incomes and benefits
    • Hourly manufacturing compensation (wages plus benefits) was $48 in Germany in 2008, the most recent year surveyed by the Bureau of Labor Statistics, while it was $32 in the United States.
    • Six weeks vacation, by law
    • Health care: German “Medicare-For-All” takes the expense of health care off of the people and businesses; giant insurance companies play no role, allowing more personal income and more for business investment
    • Receive child care and pensions.
  • Strong unions: Germany requires worker representatives to hold seats on the boards of directors of companies, depending on the number of workers, so the companies take the interests of workers and communities into account.
  • Investments in worker productivity with government-funded research, vocational training, and policies to retain skilled workers. As a result, they have higher productivity.
  • Fossil fuel businesses have little influence, and German policy is successfully reducing GHG and increasing energy efficiency.
  • German tax policy prevents transfer of wealth to the wealthy, rather than mandating it.