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The New York Times recently reported on the case of Nokuthula Masango, an employee at
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a clothing factory in New Castle, South Africa. Masango works long hours in tough conditions
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all for only $36 per week. If that sounds low, it is, even by South African standards
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where the legal minimum wage is $57 per week. Many people would describe Masango's factory
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as a sweatshop, and many would say that the owners of the sweatshop are treating Masango
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and their other employees unfairly. Now in this video I don't want to try to fully
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settle the question of whether sweatshops treat their workers unfairly or not. Let's
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grant for the sake of argument that they do. The point I want to make here is that even
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if sweatshop workers are treated unfairly, there are three points to be made in defense
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of sweatshops.
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First, it's important to remember that the exchange between the worker and her employer
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is mutually beneficial, even when it's unfair. Sweatshops make their employees better off
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even if they don't make them as much better off as critics think they should. Consider
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sweatshop wages. As you might recall, Masango earned $36 a week at her sweatshop job. Compare
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this with her friend, who lost her job at a sweatshop after it was closed for violating
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minimum-wage laws and had to find work as a nanny. That friend wound up earning just
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$14 a month, less than 12 percent of what Masango earned. And this wage gap is typical
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of sweatshop jobs relative to other jobs in the domestic economy. Studies have shown sweatshop
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jobs often pay three to seven times the wages paid elsewhere in the economy.
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So even if we think the conditions of sweatshop labor are unfair, relative to their other
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alternatives, sweatshop labor is a very attractive option for workers in the developing world.
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And this is why those workers are often so eager to accept so-called sweatshop jobs.
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Now no one on either side of the debate defends forced labor, but so long as sweatshop labor
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is voluntary, even in a weak sense of being free from physical coercion, workers would
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only take a job in a sweatshop when that job is better for them than any of their other
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alternatives. This is true even if we grant that sweatshop workers' freedom is often
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limited in a variety of unjust ways by their government or by the so-called coercion of
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poverty.
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Coercion constrains options, but as long as workers are free to choose from within their
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constrained set of options, we can expect them to select those jobs that offer the best
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prospects of success. And when given the choice between working in a sweatshop or working
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on a farm or working elsewhere in the urban economy, workers consistently choose the sweatshop
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job.
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The second point to be made in defense of sweatshops is this: Even if you think sweatshop
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labor is unfair, it is a bad idea to prohibit it. Think of it this way: People only take
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sweatshop jobs because they're desperately poor and low on options. But, taking away
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sweatshops does nothing to eliminate that poverty or to enhance their options. In fact,
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it only reduces them further, taking away what workers themselves regard as the best
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option they have.
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Now, of course, most anti-sweatshop activists aren't trying to shut down factories, but
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sometimes well-intentioned actions have unintended consequences. The layoffs faced by Masango's
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friend are a stark demonstration of this. That friend was fired because the owners of
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her factory decided it would be better to stop doing business altogether than to pay
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the legal minimum wage. And while you can make it illegal for factories to pay low wages,
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you cannot make it illegal for them to pay no wages by shutting down altogether.
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The third and final point is this. It's better to do something to help the problem
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of global poverty than it is to do nothing. And sweatshops are doing something to help.
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They're giving people jobs that pay better than their other alternatives, and they're
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contributing to a process of economic development that has the potential to affect dramatic
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increases in living standards. Most of us, on the other hand, do nothing to improve the
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lives of these workers, and that includes American companies that don't outsource
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their production at all but instead give their jobs to U.S. workers, who by global standards
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are already some of the world's wealthiest people.
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So take the perspective of one of the world's poor for a moment and ask yourself which looks
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better to you: The American company that outsources to a sweatshop or the American company that,
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because of its high-minded moral principles, doesn't? Maybe the sweatshop is run by people
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who are greedy and shallow in their motivations and maybe the other company is run by people
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with the purest of intentions. But good intentions don't get you a job and they don't feed
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your family. So which looks better now?