By Jeremy Brecher and Brendan Smith
March 10, 2000
Advocates of President Clinton's deal to admit China to the World Trade Organization claim it will benefit the poorest people of China. It is far more likely to drive down already pitiful wages, create hundreds of millions of displaced workers and lead to still worse repression.
Proponents of the deal argue that increased exports will raise living standards for Chinese workers. But the evidence suggests the opposite. The National Labor Committee, based in New York, and the China Labor Bulletin, based in Hong Kong, have discovered that production for export is already creating a "race to the bottom" within China as regions lower their labor costs to attract foreign capital.
American companies like Wal-Mart and Sears initially set up production facilities in the northern city of Tianjin, where wages averaged 50 cents an hour and employers were mandated to provide workers health and retirement benefits, overtime pay, pension insurance and sick days. But then the companies began pulling out of Tianjin and moving their work to booming sweatshops in China's southern coastal provinces. Wages were cut to as low as 13 cents an hour, benefits eliminated and work shifts stretched to 14 or more hours a day, seven days a week.
Chinese entry into the WTO will further globalize the "race to the bottom," forcing China's poor to compete against the poor of Bangladesh, Haiti and Mozambique. By pitting the poor populations in the Third World against each other, companies are able to move their operations (or their subcontracting) to whichever region offers the lowest wages, and weakest environmental, health and safety laws.
Opening its agricultural market to imports could be even more catastrophic. The Chinese government concedes that this will result in the loss of income and livelihood for millions of rural farmers. The South China Morning Post, based in Hong Kong, estimates that if China joins the WTO, the wages of rural workers will actually drop over the next five years. China's "floating population" is already estimated at more than 100 million -- and the effects of the new trade deal are likely to create hundreds of millions more.
China's social-safety net consists almost exclusively of subsidized employment -- for example, sheltered workshops for workers with disabilities. This sector is already being undermined by marketization, and it could be devastated by the market opening required by the Clinton deal. China has no substitute system of social welfare to pick up the victims.
Some human-rights advocates maintain that Chinese entry into the WTO will help bring human rights and the rule of law to China. Unfortunately, that view is highly optimistic. The conditions of the Clinton deal will destroy the most basic of human rights -- to live, eat, have a home and make a living -- for hundreds of millions of the "displaced." And China's ruling group has given every indication it will meet the unrest that will predictably emerge with more repression, not with more democracy.
Exiled Chinese human-rights advocate Harry Wu recently called the China deal "unwise and unnecessary," adding, "It gives a much needed boost to the Chinese Communist leadership."
Maybe that is good for global corporations, but it's hard to see how it benefits the people of China.
Jeremy Brecher and Brendan Smith wrote and produced the public television documentary "Global Village or Global Pillage."
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