17 March 2008

Free trade or slave trade?

In 2001, the World Trade Organization accepted China as a member. China made the usual promises: opening its markets to foreign investors and enterprises, treating national and foreign enterprises equally, reducing tariffs and subsidies, and so on. One massive subsidy however was not mentioned in the agreement -- coerced labour. Workers in China are bereft of rights we take for granted in this country, specifically freedom of speech and, of special interest for working people, freedom of association. They have no right to form independent labour unions and bargain for their pay and benefits. This coercion of labour offers goods made in China a huge advantage over goods made in free countries. It is a subsidy in all but name, yet is excluded from WTO agreements.

Chinese workers are subject to appalling exploitation, particularly migrant workers who come in from the countryside desperate for work. These workers see their pay delayed for months and sometimes they are not paid at all. They are routinely denied overtime pay, even when working as long as 18 hours a day. A government survey showed that migrant construction workers were forced to work, on average, 10 hours a day, 27 days a month. They commonly have no medical care or other benefits, and do not receive accident insurance. They often live in unheated dormitories and may even have to use the beds in shifts. An interesting note is that migrant labour is building most of the Olympic venues.

It isn't quite true to say that workers have no rights in China. For example, Chinese law restricts working hours and dictates that wages be paid monthly. The problem is that many workers are reluctant to complain because they don't have permits to work in the city and those who do complain can be beaten, even killed. In any case, public officials are commonly open to bribes from employers.

The question is why, under WTO rules, countries like China must treat foreign investors equally but are allowed to treat their own workers like slaves? The answer I suspect is that while coerced labour harms workers, both Chinese and those in other countries who have to compete against them, it is very good indeed for corporations. It has been argued that is exactly what the WTO is all about, aiding the corporate pursuit of cheap labour. Like NAFTA, it's more about serving corporate interest than serving free trade.

We cannot expect Chinese workers to receive the same benefits as workers in wealthier countries like ours, but we can expect them to enjoy the same basic human rights. And we can make it a condition for China to be accepted into international trade agreements. But first, of course, we have to design trade agreements for people rather than for corporations.

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