Soc World Developmen
Soc World Developmen SYP 4441
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This 4 page Class Notes was uploaded by Marcelina Koelpin on Monday October 12, 2015. The Class Notes belongs to SYP 4441 at Florida International University taught by Staff in Fall. Since its upload, it has received 19 views. For similar materials see /class/221764/syp-4441-florida-international-university in Social Sciences at Florida International University.
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Date Created: 10/12/15
SYP 44415447 SOCIOLOGY OF INTERNATIONAL DEVELOPMENT 0 Dr Barry B Levine The following article by economist Paul Krugman is taken from his regular column that appears in the online magazine Slate 32197 wwwSlatecom The ongoing title of Krugman s column comes from the 19th century debate between John Stuart Mill and Thomas Carlyle On the Negro Question in which retrograde Carlyle no Libertarian dismissed the argument of the abolitionists as futile declaring that economics was a dismal science Krugman s argument here is more in the style of Mill than of Carlyle and perhaps at least in this instance his column should merit another name Paul Krugman is a professor of economics at MIT whose books include The Age of Diminished Expectations and Pedding Prosperity The Dismal Scientist In Praise of Cheap Labor Bad jobs at bad wages are better than no jobs at all By Paul Krugman For many years a huge Manila garbage dump known as Smokey Mountain was a favorite media symbol of Third World poverty Several thousand men women and children lived on that dump enduring the stench the flies and the toxic waste in order to make a living combing the garbage for scrap metal and other recyclables And they lived there voluntarily because the 10 or so a squatter family could clear in a day was better than the alternatives The squatters are gone now forcibly removed by Philippine police last year as a cosmetic move in advance of a Pacific Rim summit But I found myself thinking about Smokey Mountain recently after reading my latest batch of hate mail The occasion was an oped piece I had written for the New York Times in which I had pointed out that while wages and working conditions in the new export industries ofthe Third World are appalling they are a big improvement over the previous less visible rural poverty I guess I should have expected that this comment would generate letters along the lines of Well if you lose your comfortable position as an American professor you can always find another job as long as you are 12 years old and willing to work for 40 cents an hourquot Such moral outrage is common among the opponents of globalization of the transfer oftechnology and capital from highwage to lowwage countries and the resulting growth of laborintensive Third World exports These critics take it as a given that anyone with a good word for this process is naive or corrupt and in either case a de facto agent of global capital in its oppression of workers here and abroad But matters are not that simple and the moral lines are not that clear In fact let me make a counteraccusation The lofty moral tone ofthe opponents of globalization is possible only because they have chosen not to think their position through While fatcat capitalists might benefit from globalization the biggest beneficiaries are yes Third World workers After all global poverty is not something recently invented for the benefit of multinational corporations Let s turn the clock back to the Third World as it was only two decades ago and still is in many countries In those days although the rapid economic growth of a handful of small Asian nations had started to attract attention developing countries like Indonesia or Bangladesh were still mainly what they had always been exporters of raw materials importers of manufactures Inefficient manufacturing sectors served their domestic markets sheltered behind import quotas but generated fewjobs Meanwhile population pressure pushed desperate peasants into cultivating ever more marginal land or seeking a livelihood in any way possible such as homesteading on a mountain of garbage Given this lack of other opportunities you could hire workers in Jakarta or Manila for a pittance But in the mid 70s cheap labor was not enough to allow a developing country to compete in world markets for manufactured goods The entrenched advantages of advanced nations their infrastructure and technical knowhow the vastly larger size of their markets and their proxim39ty to suppliers of key components their political stability and the subtlebutcrucial social adaptations that are necessary to operate an efficient economy seemed to outweigh even a tenfold or twentyfold disparity in wage rates And then something changed Some combination of factors that we still don t fully understand lower tariff barriers improved telecommunications cheaper air transport reduced the quot 39 g of 39 39 a in 39 39 p39 5 countries See Sidebar p 4 Other things being the same it is still betterto produce in the First World stories of companies that moved production to Mexico or East Asia then moved back after experiencing the disadvantages ofthe Third World environment are common In a substantial number of industries low wages allowed developing countries to break into world markets And so countries that had previously made a living selling jute or coffee started producing shirts and sneakers instead Workers in those shirt and sneaker factories are inevitably paid very little and expected to endure terrible working conditions I say inevitably because their employers are not in business for their or their workers health they pay as little as possible and that minimum is determined by the other opportunities available to workers And these are still extremely poor countries where living on a garbage heap is attractive compared with the alternatives And yet wherever the new export industries have grown there has been measurable improvement in the lives of ordinary people Partly this is because a growing industry must offer a somewhat higher wage than workers could get elsewhere in order to get them to move More importantly however the growth of manufacturing and of the penumbra of otherjobs that the new export sector creates has a ripple effect throughout the economy The pressure on the land becomes less intense so rural wages rise the pool of unemployed urban dwellers always anxious for work shrinks so factories start to compete with each other for workers and urban wages also begin to rise Where the process has gone on long enough say in South Korea or Taiwan average wages start to approach what an American teenager can earn at McDonald s And eventually people are no longer eager to live on garbage dumps Smokey Mountain persisted because the Philippines until recently did not share in the exportled growth of its neighbors Jobs that pay better than scavenging are still few and far between The benefits of exportled economic growth to the mass of people in the newly industrializing economies are not a matter of conjecture A country like Indonesia is still so poor that progress can be measured in terms of how much the average person gets to eat since 1970 per capita intake has risen from less than 2100 to more than 2800 calories a day A shocking onethird of young children are still malnourished but in 1975 the fraction was more than half Similar improvements can be seen throughout the Pacific Rim and even in places like Bangladesh These improvements have not taken place because wellmeaning people in the West have done anything to help foreign aid never large has lately shrunkto virtually nothing Nor is it the result of the benign policies of national governments which are as callous and corrupt as ever It is the indirect and unintended result ofthe actions of soulless multinationals and rapacious local entrepreneurs whose only concern was to take advantage of the profit opportunities offered by cheap labor It is not an edifying spectacle but no matter how base the motives ofthose involved the result has been to move hundreds of millions of people from abject poverty to something still awful but nonetheless significantly better Why then the outrage of my correspondents Why does the image of an Indonesian sewing sneakers for 60 cents an hour evoke so much more feeling than the image of another Indonesian earning the equivalent of 30 cents an hour trying to feed his family on a tiny plot of land or of a Filipino scavenging on a garbage heap The main answer lthink is a sort of fastidiousness Unlike the starving subsistence farmer the women and children in the sneaker factory are working at slave wages for our benefit and this makes us feel unclean And so there are selfrighteous demands for international labor standards We should not the opponents of globalization insist be willing to buy those sneakers and shirts unless the people who make them receive decent wages and work under decent conditions This sounds only fair but is it Let s think through the consequences First of all even if we could assure the workers in Third World export industries of higher wages and better working conditions this would do nothing for the peasants day laborers scavengers and so on who make up the bulk of these countries populations At best forcing developing countries to adhere to our labor standards would create a privileged labor aristocracy leaving the poor majority no better off And it might not even do that The advantages of established First World industries are still formidable The only reason developing countries have been able to compete with those industries is their ability to offer employers cheap labor Deny them that ability and you might well deny them the prospect of continuing industrial growth even reverse the growth that has been achieved And since exportoriented growth for all its injustice has been a huge boon forthe workers in those nations anything that curtails that growth is very much against their interests A policy of good jobs in principle but no jobs in practice might assuage our consciences but it is no favor to its alleged beneficiaries You may say that the wretched of the earth should not be forced to serve as hewers of wood drawers of water and sewers of sneakers for the affluent But what is the alternative Should they be helped with foreign aid Maybe although the historical record of regions like southern Italy suggests that such aid has a tendency to promote perpetual dependence Anyway there isn t the slightest prospect of significant aid materializing Should their own governments provide more social justice Of course but they won t or at least not because we tell them to And as long as you have no realistic alternative to industrialization based on low wages to oppose it means that you are willing to deny desperately poor people the best chance they have of progress for the sake of what amounts to an aesthetic standard that is the fact that you don t like the idea of workers being paid a pittance to supply rich Westerners with fashion items In short my correspondents are not entitled to their selfrighteousness They have not thought the matter through And when the hopes of hundreds of millions are at stake thinking things through is notjust good intellectual practice It is a moral duty Sidebar My favorite concrete example of the driving forces behind globalization is the recent and rapid rise of Zimbabwe s vegetable exports In recent years truck farmers near Harare have got into the business of supplying fresh vegetables to London markets The vegetables are picked and trucked immediately to the airport flown through the night to Heathrow and are there on the shelf in Tesco the next morning This export business depends on at least three things First it depends on cheap air transport the beatup old Boeings that have become the tramp steamers of modern commerce Second it depends on modern telecommunications the vegetables are delivered to order which means that messages must be sent to the farmers in a way that used to be possible only in advanced countries with good phone systems Finally of course the trade depends on an open British market It could not happen if import quotas or high tariffs prevented the sales Now how do you feel about all of this Here are some facts The vegetables are produced using appropriate technologyquot that is they are handgrown and handpicked using laborintensive methods with relatively little machinery As a result the truck farms create quite a few jobs in an economy that desperately needs them They are nonetheless costcompetitive because the workers are paid low wages which they are happy to get given the lack of other opportunities And oh yes the workers are black and not only are their British customers white but the farmers who employ them are white colonial settlers who have chosen to stay on under the new regime To get a taste of moral outrage against globalization turn to Corporate Watch WWW 39 g39 39 quot html a site 39 39 to exposing the greed of transnational giants Or for a bizarre twist check out Sweat Gear wwwblankorg sweatgearshoppinghtml a satirical online catalog that attacks sweatshops in Central America Another argument against globalization that it threatens democracy is made by Benjamin Barber in the Atlantic wwwtheatlanticcomatlantic electionconnectionforeignBarberfhtm The Clinton administration s word on the subject can be found in a speech by Labor Secretary Robert Reich to the International Labor Organization urging better compliance with core labor standards wwwusis israelorgilpublish presslaborarchivejunedl1612htm For more on Paul Krugman see a Newsweek profile that dubs him The Great Debunkerquot econ161berkeleyedu Economistspaulkrugmanhtml And information on employment at McDonald s can be found on the Web site of Hamburger U wwwmcdonaldscomacareers their worldwide managementtraining center I I I Thought question Using Krugman s article as a starting point be it positive or negative in your mind construct a concept of development that will allow you both 1 to understand what is going on in the Third World including the former Second World and 2 to offer advice to different sectors ofthe society as to what they should do to encourage or discourage this processes Please articulate the roles 1 of the state and 2 of culture in the processes and locate the Third World activity within the context of more general processes all throughout the globe eg the end of history the clash of civilizationsquot dependencyworld systems theory etc
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