Why Are You Buying Apple (And Other Chinese) Products?
The Market Ticker ® - Commentary on The Capital Markets

No, people argue, it's not a problem, right?  "Those people" are less human than you are here in America, yes?

This system may not be pretty, they argue, but a radical overhaul would slow innovation. Customers want amazing new electronics delivered every year.

“We’ve known about labor abuses in some factories for four years, and they’re still going on,” said one former Apple executive who, like others, spoke on the condition of anonymity because of confidentiality agreements. “Why? Because the system works for us. Suppliers would change everything tomorrow if Apple told them they didn’t have another choice.”

Pretty?  Let's just pull a few instances of "not pretty" from that source article.

Apple’s supplier code of conduct dictates that, except in unusual circumstances, employees are not supposed to work more than 60 hours a week. But at Foxconn, some worked more, according to interviews, workers’ pay stubs and surveys by outside groups. Mr. Lai was soon spending 12 hours a day, six days a week inside the factory, according to his paychecks.

That's 72 hours, incidentally.  Rather more than 60.

....the company’s dorms, where 70,000 Foxconn workers lived, at times stuffed 20 people to a three-room apartment, employees said. Last year, a dispute over paychecks set off a riot in one of the dormitories, and workers started throwing bottles, trash cans and flaming paper from their windows, according to witnesses.

Sounds like sardines.  Let's see, 3-room apartment eh?  One to do things like cook, two to sleep in.  Figure what -- 10x12 sleeping rooms, so exactly how many square feet does a person have?  Uh huh.  Why do I have imagery of a submarine at war with sailors bunking over the torpedoes?

And then, of course, after such glorious treatment, you die -- due to unsafe working conditions.

Just two weeks before the explosion, an advocacy group in Hong Kong published a report warning of unsafe conditions at the Chengdu plant, including problems with aluminum dust. The group, Students and Scholars Against Corporate Misbehavior, or Sacom, had videotaped workers covered with tiny aluminum particles. “Occupational health and safety issues in Chengdu are alarming,” the report read. “Workers also highlight the problem of poor ventilation and inadequate personal protective equipment.”

Aluminum dust I know something about.  See, it's an ingredient in commercial and amateur rocket fuel.  Really.  It's explosive, in fact, if fine enough.  It just needs the right concentration and an ignition source and boom.

It did exactly that.

Mr. Lai died, along with others.

The problem with this industrial "accident" -- and the second one that occurred 7 months later -- is that both were due to gross negligence.  This risk has been known for decades and was solved 100 years ago.  You just have to give a damn.  You judge if they did.

Incidentally, if you remember my previous article on this issue Apple's complaint was that America doesn't produce the quality of workers it needs.  Indeed, this was the quote:

“We shouldn’t be criticized for using Chinese workers,” a current Apple executive said. “The U.S. has stopped producing people with the skills we need.”

Well, now we know what the quality of worker is that Apple wants, and what they're willing to pay for that worker.

See, Mr. Lai had a College Diploma.  You know, what our students pay $40,000, $50,000, even $100,000 -- often much of it in debt -- to obtain?  Yes, that degree.  The status of accomplishment.

What was Mr. Lai's rate of pay?

The story tells us -- he was paid $22 a day.

So now we have our answer, don't we?  Apple wants college-educated workers, but the pay it offers for that college education is $22 a day, and that included overtime.  That's about $2.20 an hour, assuming that Mr. Lai worked a six day, 60 hour week -- and the story says he often worked more.

This makes rather clear the truth of the matter about these jobs and what the companies are paying for that labor, doesn't it?  Apple and others manufacturing in China aren't interested in American workers for two reasons:

  • We won't work for $22/day with a college degree -- in fact, such a wage is illegal in the United States.  Grossly so at that, especially considering overtime pay requirements for more than 40 hours in a work week.

  • We won't allow a company to have two industrial dust explosions in less than a year without someone winding up in serious trouble -- and perhaps in prison -- over the incidents.  In China they just go round up some more "college graduates" to stuff into the meat grinder.

Never mind pictures like this and stores such as the recent one run in IBTimes that show exactly what sort of environmental arbitrage that is routine in China -- and is used to further drive down manufacturing costs for products exported to the United States.

You can't do that over here either; you must instead properly capture and dispose of your industrial wastes instead of dumping them into the nearest river.

So I have two questions for you, dear reader:

First, Apple and Foxconn are both members of EICC, which has a code of conduct.  Given what the NY Times has apparently documented, that is continuing violations (not a one-off here and there) can someone explain why they remain members in good standing?

Oh, among the requirements in the EICC code of conduct is respect for the right of Freedom of Association, including but not limited to the right to associate freely, join or not join labor unions, seek representation and join workers' counsels in accordance with local laws.  Where, in China, can the workers in a plant organize?

Is that some sort of bad joke?

Second, why are we, the people of America, willing to put up with this crap?  Is the literal poisoning and blowing up of people in another land, along with the raw exploitation that is taking place, something you're willing to overlook when you buy your latest gadget?  Do you believe that the Chinese are subhuman animals

If you don't why are you buying these products?  And no, Apple is not alone in this.  Not by any stretch of the imagination.  The NY Times just happens to have their laser beam focused on them right now, but you can bet that with the suppliers of various components all being common this crap is going on nearly everywhere among Chinese manufacturers.

I think it's time to stop this abuse by any means necessary and possible, and since it's obvious after years that the companies involved won't stop, and these abuses have caused severe damage to our labor pool in the United States, there is only one lawful and peaceful solution left.

Tariffs, and lots of them, right here, right now.

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