Modern Slavery, and Thoughts Thereof.

Boy Drinking Tea near Brickmaker.  Helmand Province, Afghanistan

When I was reading about modern slavery, the author mentioned slavery amongst some brickmaking families in Pakistan.  The way it works is this: someone comes and offers a great job.  "Come work here, the pay is great!".  When someone takes the job they will find that they 'owe' money for transportation to the work site.  Plus the site is so remote that it's hard to buy food and living essentials.  Those are provided by the business, at a higher rate than normal. 

The worker soon finds that he (primarily a 'he') keeps sinking into debt.  This might be the case regardless - some brick making businesses are better than others -  but dishonesty on the part of some managers makes it worse.  These workers can't read or write, and so they have no way of verifying that their debts are being documented correctly.  Or that attempts to pay if off are counted correctly.  So even the hardest workers, ones who have no family emergencies to pay for, don't go into further debt because of unexpected illnesses or a planned wedding, will sometimes wind up deeper in debt because of this dishonesty.

While in debt the worker can't leave.  Can't quit and go find a better job.  Can't take out a loan and go to school.  The business might trade his debt (and thus his labor) off to someone else, but it never truly goes away.  If the worker causes trouble or tries to leave, the owner can try to call in the debt right then and there.  As long as the worker keeps working, the owner may let the debt ride.  This debt can also be passed on from generation to generation.  So someone might be making bricks simply because their father or grandfather took a job that promised great wages and wound up sinking into debt.

While I took the picture above in Afghanistan (and not Pakistan), I wonder if there were some other questions I could have or should have asked when we visited this brick maker.  I somehow assumed it was a mom and pop business, though in this culture the mom wouldn't be an owner.  It just looked like a family run business, since the kids were clearly part of a family working here.  Now I wonder who actually owned the business, and how well the family was paid.

As I've been reading up on this, I find myself wondering "How can people do this to each other?"  How can you be so divorced of empathy, compassion, respect for life and human dignity...how can you be so blocked off from our natural desire for connection...that you would create a system that depends so much on making other people's lives miserable?  And not just the worker's life, but the lives of his or her children?  The entire family?

I know enough to say that it's not exclusive to any one group or culture.  Our own history of company towns show some eerie similarities, though some of the companies had high ideals for creating a town like this.

What Kevin Bales indicates in his book Disposable People is that our modern economy makes it hard to know where and how such practices makes it into our modern economy.  It's made me think about what a fair cost is for a lot of things.  He mentions that oftentimes the business owners are divorced from the day to day running of that business, they just put pressure on the middle managers to save money...and some of those managers find the only way to make profit is to "reduce expenses" i.e. find ways of paying less for labor, since other expenditures are fixed.  And so we have charcoal burners in Brazil working in a similar fashion.  (I have carefully avoided talking about the sex trade, as there are other factors involved there...but some of the same dynamics are at play.)

What is a fair cost?  Maybe we really should be paying a couple of dollars more for those chocolate bars, as one example, that claim fair pay for the workers.  Or (to bring this closer to home) maybe an extra 17 cents for a Big Mac isn't such a big deal, if it allows workers to make enough to raise a family without food stamps and welfare.  And Walmart, which is one of the largest employers, shouldn't pay a wage that also requires welfare to raise a family.

"But what about the free market?" you might ask.  Aren't these the wages dictated by supply and demand?

And how can we expect these companies to compete if they raise our wages, when companies can go elsewhere to pay even less?

If companies were barely breaking even I would think that's a valid point.  Can't expect somebody to stay in business if they're not making any money.  Yet this concept of 'rents' interests me, because the difference between the sale price and the cost of making something can sometimes be substantial...and who gets what portion of that 'rent' says a lot about our economy today.

Shifting gears a bit,  I want to throw something else out there.  Back when Spain was extracting a lot of gold from the Americas most nations thought wealth came from hoarding gold.  The more gold you had in your treasury, the better off you were.  Part of Adam Smith's genius was pointing out that a good economy did not come from hoarding gold, but from a free market economy.  (btw, he also thought the government should be responsible universal education and public infrastructure).

I would love to see some studies asking whether the modern equivalent of 'hoarding gold' is doing the same thing.  That is, just as I've seen article after article talk about how wages are stagnant and the middle class is shrinking I've also seen repeated articles mention that various groups (large corporations, the 1%, etc) are sitting on piles of money.  Some of that is probably  necessary.  No business wants to go under because they lack liquidity during a crisis (that's happened to a couple big names already).  Yet how much of that is good business practice, and how much of that is the equivalent of hoarding gold?

As for the free market economy, I'm not entirely sure we're seeing it at play here.  Certain groups seem to have captured the market, to the point where they're able to influence the economy more than would happen otherwise.  For example, could Walmart seriously find workers if those workers were unable to get welfare to make ends meet?  At some point people will say 'it's not worth working my butt off when I can't make ends meet on the wages I'm getting'.  Or even "why should I work hard just to make sure some CEO or shareholder can buy a private yacht?"

Actually, I think people are already saying that...which is why this ties in a bit with immigration.  Illegal immigrants sometimes take the jobs that Americans don't want, because those jobs pay too little to appeal to someone who grew up here.  Businesses, rather than increasing their wages, hire illegals instead.

A few final thoughts.  I don't believe businesses should be charities.  Keeping unproductive people on the job hurts everyone.  At the same time, I think we've already made the decision (as a society) that we don't want people fired for lack of jobs to wind up homeless and dying on the streets.  Hence the social safety net, such as it is.

We're facing some major transitions today.  Automation - and globalization in the more industrialized economies - is taking away a lot of the jobs that used to be there for what's called an 'unskilled' population. (Even though it's called unskilled, experience and skill can make a big difference in improvement, so it's technically not.  I've seen this at work, where we have some pretty simple jobs anyone is capable of doing...and yet it's hard to find the right person for the role.)  I don't want to be a Luddite, and throw away this technology just to keep people employed.  I think that's a waste of resources.  I also think that very few people enjoy doing the boring, monotonous jobs that are best suited for automation.  (It seems sad to say that all a thinking and feeling human being is capable of is to do some repetitive and brainless task.  I kind of feel they should be paid more not because it requires a special skill, but because it's such a waste of human potential.  Reminds me of a science fiction book that had a restaurant that was considered classier and more expensive because it used real human servers.) 

And so I wonder what an economy like that would look like.  One where most people have the skills to do the higher level jobs, where only a few people work the 'unskilled' ones that can't be automated - and are paid well for it - and where our products cost what they 'should' in so doing.

Some things would probably be much more expensive, but if it's made using the charcoal  made by the Brazilians I mentioned above, isn't that an artificially low cost?  Or if a t-shirt is now twice as expensive, but the price we're used to came from ]mistreated garment workers, is that truly a fair price?

And how much would truly destroy a business, versus just changing what portions of the pie everyone gets?