How we’re building the middle class in China

Image copyright: Ryan Pyle for The New York Times

Are we, the U.S. consumers, monsters for heartlessly exploiting workers in developing countries to feed our endless greed for electronics? Or are we recipients of the wonder of globalization, which is also slowly making China a better place? While I’ve touched on this issue on other blog posts, Professor Zhu’s contribution in “The Agony and the Ecstasy of Steve Jobs” made look deeper into this issue.

We’ve had the horrible images of the sweatshops described to us. We felt sympathy, guilt, outrage. Then we might have felt either outrage or acceptance when it came to light that some of Daisey’s claims were meant to move us emotionally, not necessarily inform us. We were also told about the other major actor, right in the middle of the consumers and the corporations, the laborers themselves. The way they were portrayed by Daisey was even to a guerrilla army: hiding, sometimes in plain sight, gathering information and slowly building support despite being repeatedly harassed. I felt the portrayed supported that the unofficial unions were somewhat toothless. In exploring a variety of news articles, it seems to me that some parts of the changing Chinese sociopolitical landscape was not talked about. That of social change due to official and unofficial union actions.

The New York Times talks about the changes that have begun happening in Chinese society. Economic growth is slowing down and the availability of labor, while still impressive when compared to developed countries, is shrinking. This has increased the bargaining power of Chinese laborers.

Even the attitude of the Chinese government of giving corporations much liberty as long as they are investing in China seems to be gradually shifting. Bloomberg reports on how as the economy is slowing down, Chinese authorities trying to make consumption, not only investment, a primary source of growth for the economy. David Dollar, a former U.S. Treasury Department official in Beijing, is quoted as stating: ““It’s like that old Henry Ford story: I’ve got to pay my workers enough so they can buy my product,”. On the other hand, it seems much of the resistance to labor movement comes not from the central government, but from regional government that are unwilling to deal with the unrest and economic consequences from labor demands.

Stories of protests staged by underground unions or even approved by the official Chinese union have shown however, that the demand for change is growing at an increased rate, spurred by the rising Chinese middle class. Abandoning their posts, or simply choosing to idle instead of work, Chinese workers have inflicted economic damage on IBM, Nike, Adidas and many other companies. Their actions have been with results as well, as previous irregularities such as the withholding of social security payments have been reduced and wages are seeing an increase.

This made me wonder whether the efforts of many U.S. consumers (apart from mass boycotting) are simply pointless when compared to the change demanded by the Chinese workers themselves. After all, has Apple seen a dramatic sales downturn since the scandal? Has their policy fundamentally changed since then? Nothing groundbreaking actually happened, so it was all a waste of time…right? Maybe not so: in an article in The Guardian, Adidas’ stance on the protests were quite unlike the other corporations’: they actually lobbied for the release of detained labor activists and encouraged the resolution of the workers’ grievances. Did Adidas decide to support the workers’ plight because the decision-makers there were all good-natured people? Perhaps to an extent, but the desire to create a positive image of their company definitely played a key part. And that desire springs from the demands of the consumers, who are not only interested in the attributes of the product itself, but also in every aspect in the supply and production chain.

Investigating this issue has made me understand how complicated the situation is. It has also shown me that it might be too optimistic to believe that we as consumers have the power to dictate what corporations do in developing countries, regardless of the actions of the country’s own citizens. That does not mean however, that we do not have our parts to play if change, whether social, political or economical is to happen.

Featured image can be found at TheEconomist.com and is created by Jon Berkeley.