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Home | Wire | "Sweatshops" Are Like Lifeboats for the Poor — Don't Sink Them

"Sweatshops" Are Like Lifeboats for the Poor — Don't Sink Them

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Tags Free MarketsGlobal EconomyLabor and Wages

08/02/2018

Being on a lifeboat does not sound like a pleasant experience. You’re hungry, baking under a hot sun, surrounded by sharks and endless miles of ocean, and the extent of your living space is maybe ten square feet. Being stuck on a lifeboat is not an ideal way to enjoy the ocean.

So given that being stuck on a lifeboat sucks so much, wouldn’t it be best if we just got rid of lifeboats? This is the logic of people who advocate shutting down sweatshops.

Working in a sweatshop is something I would like to avoid. Long, laborious hours in a hot factory for meager pay is not my top career choice. At the risk of making sweeping generalizations, nobody enjoys working in a sweatshop.

So why do people continue to do so?

If you look at the countries in which sweatshops exist, you don’t see a free market. You see the heavy hand of government intervening in the economy. These governments constrain trade, impede industry, and inhibit economic growth.

So the answer to why people continue to work in such deplorable conditions is pretty simple: they don’t have any other options.

Typical progressive compassion diagnoses a situation such as this, identifying the deplorable conditions of the sweatshop worker, and decides that the best thing one can do for them, when looking at all their available options, and then to remove the one they actually chose to do. From their moral pedestals, these activists proclaim that the children of these poor countries (countries implementing many of the very policies these activists lobby for) deserve an education, all while promoting regulations that serve to displace children into street thievery and prostitution.

This is what happened when Bangladesh passed their Child Labor Deterrence Bill in 1994. 50,000 Bangladeshi children lost their jobs, and the humanitarians broke open the champagne while these children took to even more dangerous work such as stone crushing and prostitution

Abolishing sweatshops is not the remedy to the dismal conditions of the citizens of poor countries. Removing the government from the economy would be, but even short of that, any reduction of trade regulations, taxation, and socialization will help foster an environment in which sweatshops are done away with naturally, through market competition and capital accumulation.

If you want people to have more access to education, food, and healthcare — among other first world amenities — then the best thing you can do for them is to support policies that allow for capital accumulation. Socialists hate this concept, but reality persists even in the face of Marxist bromides. An increase in capital means an increase in production, and an increase in production must precede an increase in consumption. You cannot have your cake and eat it too, and you certainly cannot eat your cake before you have it.

Abolishing sweatshops outright while continuing socialist policies does the opposite of increasing production. It essentially amounts to removing the lifeboat from the person stranded at sea.

Capitalists don’t deny that sweatshops are bad, at least relatively speaking. A modern white collar job is preferable to a sweatshop job. The capitalist simply acknowledges the reality that this kind of economy has to develop over time and, most importantly, under the right conditions: free market conditions.

Sweatshops are not the problem; they are a symptom of the problem. If you want to treat the true illness, instead of advocating the removal of sweatshops, focus on removing the government from the economy.

Chris Calton is a 2018 Mises Institute Research Fellow and an economic historian. He is writer and host of the Historical Controversies podcast.

See also his YouTube channel here.

Note: The views expressed on Mises.org are not necessarily those of the Mises Institute.
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