By: George Noga – June 17, 2013
Our hearts go out to the victims of the building collapse in Bangladesh; they were hard workers striving simply to build a better future. The government building inspectors and all others who are complicit deserve severe punishment. However, it is crucial we learn the correct lessons from the workers’ terrible sacrifice. The media and their liberal camp followers have been quick to draw conclusions and to apportion blame; among the things they believe are:
- Greedy capitalists choose to pay subsistence wages for working in intolerable conditions;
- Capitalists’ ill-gotten gains can be used for higher wages and better working conditions;
- Desperate conditions in Bangladesh are due to an absence of government regulation;
- Globalization and free trade harm the poor and exploit child labor; and
- Boycotts of companies that sell products made in bad conditions help the poor.
Each and every one of the above beliefs is wrong; they are voodoo economics and the consequences of acting on these beliefs is highly destructive. The masses in Bangladesh already are living at bare subsistence; anything that increases the cost of employing them – be it higher wages or better conditions – comes at their expense and results in unemployment. The higher the price of anything, the less will be bought; this applies universally including in Bangladesh.
“Economic Liberty – not government intervention – creates wealth.”
Everyone desires higher wages and better working conditions for third-world workers. Ignoring the laws of economics (media and liberals) only worsens the situation. To actually bring about such results requires the maximum degree of economic freedom and the dead minimum of government and outside interference. We have seen time and time again – in Hong Kong, South Korea, India, and now China that within one generation workers are much better off. New factories open with more advanced equipment and competition for labor intensifies leading to higher wages. As wages rise, workers are willing to trade off for better conditions.
Globalization – Free Trade – Child Labor – Boycotts
Globalization and free trade benefit the poor in particular. To the chagrin of elitists, the poor grasp this viscerally; that’s why, inter alia, they embrace Wal-Mart. The greatest beneficiaries are those who live in poor countries (including Bangladesh) with whom we trade. Voluntary labor – yes including children – and even at low wages and less than ideal conditions – is not exploitative. Workers choose to work because it is better than what they had before and offers a path to a better life. This is how they work their way out of poverty.
Workers (including children) in Dickensian England were better off in the factories than the life they voluntarily left. It was the same in the United States where child labor was common until the early part of the twentieth century. My uncle began working in the coal mines at age six because young children with their small, lithe bodies could crawl into small places.
“Who do you trust to look out for children: government or parents?”
In England and the US, child labor had vanished well before the passage of child labor laws. As soon as humanly possible, parents remove their children from the labor force. It comes down to who do you trust to have the best interests of children at heart – their parents or government?
Boycotts are primarily the province of economically illiterate movie stars with too much time on their hands. Even if a boycott could be effective, the greatest harm would befall the displaced workers trying desperately to lift their families out of poverty. Low income Americans also are harmed by having to pay more for many products just to pander to the falsetto angst of Hollywood types who feel but do not think.
The media and liberals set up straw men, in this case greedy businessmen, and then rail against them. They don’t understand economics and they don’t know what they don’t know. They ignorantly call for boycotts that harm those they seek to help. Then, satisfied they have demonstrated their compassion and good intentions, they retreat back inside their plastic bubble where life is so much simpler than in the real world, where thinking rather than feeling counts.