[afmdiscussion] Fwd: Re: [saymaListserv] Fwd: Globalization and the Poor: Do Quakers have a realistic view of world poverty?

Janet Minshall jhminshall at comcast.net
Fri Apr 8 11:09:33 JEST 2005


Hi Julia,  Sorry to have been slow to respond.  I have been 
indisposed.  I will respond to your questions at the bottom:

Julia wrote on 4-3-05:

>Here is where I have a question or two.
>
>I agree that American or Western businesses can easily outbid local
>companies
>for these offshore workers' labor--and do--and still be considerably under
>the rates they would have to pay in the US. However, just because they offer
>these
>women more wages than the local companies offer, it does not follow that
>these women are paid equal to the male workers hired by the American or
>Western company. Since the women are used to accepting lower pay than men,
>there is every incentive for US companies to continue paying them less than
>men,
>  even though the total wage context is higher than the local custom. As far
>as I know,
>US laws and regulations regarding equal pay, fair employment practices and
>safe/healthy
>working conditions do not apply offshore--which is a large element in
>motivating
>US companies to go offshore for labor. American companies might continue to
>voluntarily
>honor equal pay practices among executives and consultants exported from the
>US to
>supervise or monitor the offshore business, but the ordinary worker might
>not
>be aware of same, or if aware, might not conclude that executive pay had any
>relationship to labor wages.
>
>Is there any reliable data in these sources, Janet, or any others, about how
>often
>US companies exhibit the high degree of altruism needed to pay women equally
>and eschew child labor when there are no laws or penalties in these
>countries?
>And has the Bush administration suddenly gotten a case of conscience and
>passed
>massive tax credits and incentives for paying foreign labor more than
>absolutely necessary
>in order to advance female equality and eliminate child labor??? Just
>asking...



First,  continuing my messages earlier to Charles Schade and Bill 
Reynolds of SAYMA,it does not follow, necessarily, that women would 
have to be paid an equal wage for equal work, but it happens that US 
multinationals and those which are letting outsourcing contracts to 
countries which have a lower wage scale are having to consider not 
just public pressure from women and other activists in the US for 
equal pay for equal work, but also European (EU) pressures which are 
far more rigorous and demanding than those in the US.  It generally 
is not practical to try to maintain different payscales when there 
are analysts from various international agencies as well as the NGOs 
looking over your shoulder around the globe and going to court to 
subpoena employment records from which they can and will produce bad 
publicity and successful complaints to  international bodies such as 
The World Bank and The World Trade Organization. These international 
bodies, so thoroughly maligned by anti-globalizers and some Friends, 
are actually doing some good things for poor and working people 
around the world.

The only reliable data I can offer are the two highly recommended 
books and the article in Foreign Affairs I recommended in previous 
messages and their very thorough footnotes.  It doesn't really make 
sense for you to get the names of companies and how much they pay in 
local currency because unless you are an economist specializing in 
the current economy of the country in question, you won't know how to 
interpret that information.  Jaghwhad Bagdish, like Jack Powelson, 
the Quaker economist I refer to frequently, has been to a wide 
variety of other countries and studied the issues and relationships 
in the political economy they found there.  They can, and do 
thoroughly document information relevant to how a pay scale relates 
to a living wage in that country  -- and it differs somewhat in every 
country.

Simplistic mass distributed materials from some union representatives 
and spokespersons use a rough translation from local currency into US 
dollars or Euros and imply that the lower wages are obviously 
inadequate.  Yes, they would be in the US or Western Europe, but the 
point is that workers in lower wage countries live in very different 
circumstances. Their housing, food and medical care costs far less 
than in the US.  That is how their standard of living increases 
dramatically even with a somewhat lower wage than that given to US 
and European workers.
				Best Regards, Janet Minshall







>Thanks to Janet for a very interesting and helpful letter, in which she
>wrote in part.
>citing Bhagwati:
>
>>Japanese male executives were first sent to the US with
>>  their wives and children.  Wives saw how women lived, worked and went
>>  to college in the US and began slowly pressuring for similar
>>  opportunities in Japan, as did the wives of college and graduate
>>  students after they returned home. (Remember that now, in 2005, many,
>>  many more countries where multinationals are operating are sending
>>  their foreign executive personnel with their families to live and
>>  work in the US for awhile, and 60% of the students in US graduate
>>  schools are foreign students who often bring their wives and children
>>  along, just as the Japanese did).
>>
>>  Similarly, Japanese men learned back then during their time in the
>>  US, and continue to learn more significantly over time that the old
>>  habits of paying women lower wages for the same work that men did was
>>  no longer acceptable.  They have learned that "prejudice has its
>>  price: any firm that indulges in it is going to be at a competitive
>>  disadvantage to firms that hire without this prejudice....Now if
>>  there is a closed economy and all domestic firms share this prejudice
>>  (and pay women a lower wage) all firms will be equally handicapped.
>>  But when we introduce foreign competition, the foreign firms that do
>>  not share this prejudice will be able to gain in competitiveness
>>  against domestic firms....Liberalized trade which enables foreign
>>  firms to compete with domestic firms in open markets, therefore, puts
>>  pressure on domestic firms to shed their prejudice. The gender wage
>>  gap will then be reduced in industries that must compete with imports
>>  produced by unprejudiced firms elsewhere."
>
>This has IMHO also been happening regarding women from the predominantly
>Muslim countries, who have met American Muslim women who are freer
>in their dress and privileges (rights) and inclination to challenge male
>traditional interpretation and doctrine and male authority. It has helped
>fuel the already burgeoning women's rights movements "back home"
>
>>  This same principle applies even more widely now, both in regard to
>>  multinationals who move production abroad to take advantage of a
>>  lower wage structure and to the process of outsourcing to cheaper
>>  labor markets. Multinationals and outsourcers have easy access to
>>  traditional domestic labor forces as long as they they pay somewhat
>>  higher wages and provide equal wages for equal work. In the rest of
>>  the globalizing world both women and minorities in countries whose
>>  producers have traditionally paid lower wages on the basis of sexual,
>>  class, caste or color prejudices are experiencing a progressively
>>  rising wage scale and a higher standard of living.  If a woman or
>>  minority worker's current domestic employer won't pay them adequately
>>  they can go to the other side of town, or even move to the outskirts
>>  of a nearby city, and work for a higher wage for a multinational or a
>>  domestic company with an outsourcing contract.  To counter the loss
>>  of trained laborers in this manner, domestic producers must adjust
>>  their wages and their discriminatory hiring and benefits policies to
>>  retain their workers. This opening up of foreign labor markets
>>  ultimately produces the impressive statistics I cited in my first
>>  message about the significant and continuing reduction of world
>>  poverty in those countries which are in process of globalizing.
>
>Here is where I have a question or two.
>
>I agree that American or Western businesses can easily outbid local
>companies
>for these offshore workers' labor--and do--and still be considerably under
>the rates they would have to pay in the US. However, just because they offer
>these
>women more wages than the local companies offer, it does not follow that
>these women are paid equal to the male workers hired by the American or
>Western company. Since the women are used to accepting lower pay than men,
>there is every incentive for US companies to continue paying them less than
>men,
>  even though the total wage context is higher than the local custom. As far
>as I know,
>US laws and regulations regarding equal pay, fair employment practices and
>safe/healthy
>working conditions do not apply offshore--which is a large element in
>motivating
>US companies to go offshore for labor. American companies might continue to
>voluntarily
>honor equal pay practices among executives and consultants exported from the
>US to
>supervise or monitor the offshore business, but the ordinary worker might
>not
>be aware of same, or if aware, might not conclude that executive pay had any
>relationship to labor wages.
>
>Is there any reliable data in these sources, Janet, or any others, about how
>often
>US companies exhibit the high degree of altruism needed to pay women equally
>and eschew child labor when there are no laws or penalties in these
>countries?
>And has the Bush administration suddenly gotten a case of conscience and
>passed
>massive tax credits and incentives for paying foreign labor more than
>absolutely necessary
>in order to advance female equality and eliminate child labor??? Just
>asking...




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