Discounting Lives to Maximize Profits

by WALTER BRASCH

Imitating Sgt. Schultz of “Hogan’s Heroes,” Walmart executives claimed they knew nothing—NOTHING—about working conditions in a garment factory in Bangladesh where 112 workers died and more than 150 were injured in a fire.

Tazreen Fashions made Walmart’s Faded Glory brand clothes, as well as clothes for Sears and other dozens of other major retailers. Walmart officials told the news media they had previously terminated Tazreen as a direct supplier because of concerns about fire hazards, but that another supplier had subcontracted the work to Tazreen. Walmart refused to identify the supplier. In an official statement, Walmart said that the fire was “extremely troubling to us, and we will continue to work with the apparel industry to improve fire safety education and training in Bangladesh.”

News reports indicate that survivors said fire extinguishers didn’t work, exit doors were locked, and there were no emergency exits. The AP reports that most fire extinguishers were not used, the workers having no knowledge of how to use them. According to the AP, most of the workers, about 70 percent of them women, were from the poorest sections of Bangladesh. More than 700 workers have died since 2005 from fires in the Bangladesh’s growing clothing manufacturing industry, according to the International Labor reporting Forum.

As with the Triangle Shirtwaist factory fire in New York in 1911, where 146 women, most of them recent Jewish and Italian immigrants working in sweatshop conditions, the workers at Tazreen were burned alive trying to get through the doors that never opened, died from smoke inhalation, or jumped to their deaths. Many of the dead in both fires were buried in unmarked graves, their bodies unrecognizable. The Triangle fire eventually led to improved safety conditions and the rise of the International Ladies Garment Workers Union to protect workers from management callousness.

Walmart has a fierce anti-union policy for its own stores and employees, but doesn’t say much about working conditions in companies that supply merchandise, nor does it actively oppose unions in other companies overseas. There is no organized representation for most of the workers in Bangladesh sweatshops. Most workers earn $8.50 to $12.50 for a 48 hour work week, with mandatory overtime that can push them to as many as 80 hours. They receive two or three days off in a month. If Americans wonder why their clothes may not be as good as American-made clothes produced in union shops, the answer could be that the workers in Bangladesh may be mentally and physically fatigued, and that multinational corporations pressure suppliers to cut costs on material and labor. Bangladesh, now competing with China, shipped about $18 billion worth of merchandise to American and European corporations last year.

About 40 percent of all merchandise sold by Walmart is produced by contracts with manufacturers (most overseas), where low wages, excessive work hours, and poor working conditions are accepted practice. Walmart doesn’t make public the names of the companies which produce those “low prices” merchandise. However, it is known that it has contracts with several Bangladesh companies, as well as more than 20,000 Chinese manufacturers.

With revenue of more than $447 billion a year and about a 25 percent profit, Walmart is the largest public company in income in the world. But with its “low prices” slogan comes significant risk.

Walmart and other corporations have pushed American suppliers to outsource their own merchandise to overseas suppliers. More than 3.3 million American jobs will have been outsourced by 2015, according to the U.S. Department of Labor. However, Goldman Sachs projects that as many as seven million jobs will have been lost by 2014. Most are in clothing and computer/electronics manufacturing, and in service centers where American customers call “help” lines and often get a heavily-accented representative who says his name is “Sam.” What most politicians, business people, and the public don’t understand is there is a direct correlation between the number of jobs outsourced and high unemployment in the U.S.

Walmart, which originally established a “Buy American” slogan before strutting its “lower prices” philosophy, now claims that over half its merchandise is made in America. This may or may not be accurate—Walmart doesn’t give specifics. But, if accurate, most of that is from its expanded grocery stores. Clothing, electronics, household goods, and thousands of other products are still made overseas—usually in conditions that are, at best, sweatshops; at worst, death traps. Every Congressional bill to ban the import of products produced in sweatshop conditions has been smothered in the committee process.

It’s possible that Walmart executives and upper management of the 2.2 million employee corporation that has eyes in almost every spot of the world did not know about working conditions in Tazreen—or any of the other sweatshops in Asia. It’s also possible they did know, but did a PR shuffle to explain their indifference. It really doesn’t matter.  

The sweatshops allow the corporations to sell the cheap merchandise that results in higher return on investment for American corporations that rely upon American consumers who want cheap merchandise, and don’t seem to care where it comes from or how it’s produced.

But, even those Americans who do care, and would pay higher prices for merchandise produced by workers in unionized American manufacturing plants, usually don’t have a choice. It’s hard to find “Made in America” labels on clothes and numerous other products sold by major retailers that have largely ignored sweatshop conditions in order to maximize profit.

[Walter Brasch’s latest book is Before the First Snow, which looks at working conditions. Assisting on this column was Rosemary R. Brasch]