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Thursday, Jul 24, 2014
Editorials

The scourge of globalism

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“This is called slave labor,” said Pope Francis.

The Holy Father was referring to the $40 a month paid to apparel workers at that eight-story garment factory in Bangladesh that collapsed on top of them, killing more than 400.

“Not paying a just wage … focusing exclusively on the balance books, on financial statements, only looking at personal profit. That goes against God!”

The pope is describing the dark side of globalism.

Why is Bangladesh, after China, the second-largest producer of apparel in the world? Why are there 4,000 garment factories in that impoverished country which, a few decades ago, had almost none?

Because the Asian subcontinent is where Western brands – from Disney to Gap to Benetton – can produce cheapest. They can do so because women and children will work for $1.50 a day crammed into factories that are rickety firetraps, where health and safety regulations are nonexistent.

This is what capitalism, devoid of a conscience, will produce.

Not long ago, the shirts, skirts, suits and dresses Americans wore were “Made in the USA” – in plants in the Carolinas, Georgia and Louisiana, where the lower wages, lighter regulations and air conditioning that came after World War II had attracted the factories from New England.

The American idea was that the 50 states and their citizens should compete with one another fairly. The feds set the health and safety standards that all factories had to meet, and imposed wage and hour laws. Some states offered lower wages, but there was a federal minimum wage.

How did we prevent companies from shutting down here and going to places like today's Bangladesh to produce as cheaply as they could – without regard for the health and safety of their workers – and to send their products back here and kill the American factories?

From James Madison to the mid-20th century, we had a tariff.

This provided revenue for the U.S. government to keep other taxes low and build the nation's infrastructure. Tariffs prevented exploiters of labor from getting rich here on sweatshops abroad.

Tariffs favored U.S. companies by letting them compete for free in the U.S. market, while a cover charge was placed on foreign goods entering the U.S.A.

Foreigners had to buy a ticket to the game. Americans got in free.

After all, it’s our country, isn't it?

But in the late 20th century, America abandoned as “protectionism” what Henry Clay had called The American System. We gave up on economic patriotism. We gave up on the idea that the U.S. economy should be structured for the benefit of America and Americans first.

We embraced globalism.

The ideological basis of globalism was that, just as what was best for America was a free market where U.S. companies produce and sell anywhere freely and equally in the U.S.A., this model can be applied worldwide.

As one might expect, the big boosters of the concept were the transnational corporations. They could now shift plants and factories out of the high-wage, well-regulated U.S. economy to Mexico, China and India, then to Bangladesh, Haiti and Cambodia, produce for pennies, ship their products back to sell here at the same old price, and pocket the difference.

This would lead inexorably to the deindustrialization of America, a halt to the steady rise in U.S. workers’ wages and standard of living, and the enrichment of a new class of corporatists.

And so it came to pass. U.S. real wages have not risen in 40 years.

In the first decade of the century, America lost 5 million to 6 million manufacturing jobs, one in every three we had, as 55,000 factories closed.

We built the global economy – by gutting our own.


Patrick J. Buchanan’s column is distributed by Creators Syndicate Inc.

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