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Introduction
Workers in advanced capitalist economies face increased
job insecurity and, in many sectors, lay-offs and real wage contraction.
Demands are rising in these economies for promoting labor standards
internationally. One mechanism for promoting labor standards is
for governments to attach social clauses to trade agreements and
to initiate, or threaten to initiate, trade sanctions against
governments which fail to meet the terms of these social clauses.
The expectation is that the threatened governments will promulgate
better laws or, often more importantly, implement existing labor
laws more seriously. [1]
Governments in many countries, especially those
where labor standards are not well enforced, claim that the linking
of social clauses to trade agreements is a form of thinly disguised
protectionism. Some scholars criticize the pursuit of international
labor standards as aggressively unilateral and contrary to principles
of international law. [2]
According to Philip Alston, author of Labor
Rights Provisions in US Trade Law,
the form in which the standards are stated
is so bald and inadequate as to have the effect of providing
a carte blanche to the relevant US government agencies, thereby
enabling them to opt for whatever standards they choose to
set in any given situation. [3]
As labor rights provisions of US trade law require
findings by the executive branch of government, they are typically
initiated for foreign policy objectives rather than the principled
promotion of international labor standards. The first countries
to lose US Generalized System of Preferences status on account
of their neglect of workers' rights were Paraguay, Nicaragua,
and Romania. These were not the three countries with the world's
worst records on labor rights, but were countries targeted for
foreign policy considerations by the Reagan Administration.
Consumers in advanced capitalist countries claim
that, given the choice and the information, they would purchase
products that are made under conditions which respect labor rights
even if these products are more expensive than those produced
under conditions that deny to workers fundamental rights. In recognition
of rising consumer consciousness, many US companies have promoted
corporate codes of conduct. In the United States, those of Levi
Strauss & Company and Reebok are perhaps the best known. The
Gap, Nike, Sears, Timberland, Walt-Disney, and many other US businesses
have also adopted codes of conduct for their overseas producers
and suppliers. In many of these companies and in the garment,
footwear, and sportswear industries in general, widespread violations
of fundamental labor rights have been observed. Have corporate
codes of conduct been useful in improving labor standards or only
in improving the public stature of these transnational corporations?
Can corporate codes of conduct promote labor standards in a non-coercive
fashion and without becoming instruments of foreign policy?
To address these central questions, this paper
considers a number of related questions. What is the relationship
between the transnational company and the producers? Do corporate
codes of conduct transfer the economic cost of corporate responsibility
to subcontracting companies? This paper addresses these questions
by examining footwear and sporting apparel production by Reebok
and its major competitors, Adidas and Nike, which also subcontract
production in Thailand.
Footnotes:
- International labor standards are addressed
in four pieces of US legislation. These are the Caribbean Basin
Economic Recovery Act of 1986; the Generalized System of Preferences
Renewal Act of 1984; the Overseas Private Investment Corporation
Renewal Act of 1985; and the Omnibus Trade and Competitiveness
Act of 1988.
- Philip Alston borrows the phrase "aggressive
unilateralism" from Jagdish Bhagwati's and Hugh Patrick's
discussion of section 301 of the Omnibus Trade Act of 1988.
Alston argues that the phrase applies as well to the worker
rights provisions of US trade laws. See Philip Alston, "Labor
Rights Provisions in US Trade Law," Human Rights Quarterly,
15: 1, (February 1993), 1-35 and Jagdish Bhagwati and Hugh Patrick,
eds., Aggressive Unilateralism: America's 301 Trade Policy and
the World Trading System, Ann Arbor: University of Michigan
Press, 1990.
- Alston, "Labor Rights Provisions in US
Trade Law," 1993, 7-8.
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