Friday, March 30, 2012

Foxconn: What Does That Name Mean?

News! That is all.
I was just told I should elaborate so here we go. There has been a lot of talk about iPads lately, namely the release of a new one that, much like the old one, I can't afford. To be perfectly honest, I have no use for one but they are so cool I still want one. I feel like it would match my iPhone and maybe make it less lonely.
Anyway, todays iPad news is coming from, where else, China. Like most things in America, iPads are made in China. Go ahead, take a minute and look around you. Check the tags on your clothes and the bottoms of electronics or anything else. Chances are it says "Made in China". For some quick background, iPads are made in China by a company called Foxconn, with factories mostly in the south of China.
Well reports are coming out about labor violations in Foxconn factories. First of all, I didn't even know China had labor laws. True story, I once saw a guy welding on a Sunday evening wearing nothing but flip-flops and shorts. No shirt and certainly no safety glasses, much less a welders mask. I've seen workers literally hanging out windows to install air conditioners. That's why when I saw this report, I figured it must be really really bad in a Foxconn factory.
I was picturing workers chained to their desks, getting whipped while Communist propaganda plays loudly.
Those workers are way too animated
Anyway, instead of the hilarious scene above, workers were reporting extreme dissatisfaction with pay scale and hours (join the club). For example, Foxconn factory workers acrue overtime in 30 minute increments, which means 29 minutes extra means no overtime and 59 minutes means only one unit. As an American, that sucks. But for a Chinese worker, that's still pretty decent. In fact this is the first time I've even heard of overtime pay in China. Seriously, that's not a joke.
Workers were paid above the legal minimum (again, didn't even know there was a minimum wage in China) and always on time. But almost 65% of workers reported being unable to cover their basic needs.
I'm going to pause for a moment to editorialize. I lived in China for 5 years and was paid in Chinese currency at Chinese rates and was able to live very comfortably. I will admit that I did not live in the major metropolis that is Shenzhen, but cost of living was pretty damn cheap. I could literally feed myself three meals for less than 4 American dollars. Transportation was cheap. Rent was cheap. Granted, I wasn't providing for a family, but I feel like I probably could have on my salary.
What are these workers spending their money on? They're getting paid well above minimum, which in China is more than enough to live on.
Of course the majority of workers are of the migrant variety. China has a floating population of roughly 300 million migrant workers who travel from their countryside towns to the big cities looking for work. This often lands them in factories or working construction. They live in workers dorms which suck more than the dorms at any American state university. I'm looking at you UMass. The dorms are usually not heated with no hot water and there are up to 8 people crammed into a dorm room. And you thought your job sucked.
Despite all these drawbacks, workers at Foxconn are still getting paid fairly well (relatively speaking). I don't mean to defend what very well may be horrible conditions, but I think the problem lies in unrealistic expectations. Because its a prominent American company, I think people are expecting to receive wages and treatment commensurate with that.
What we have to remember is that China is not America. Our labor laws were shaped during the Industrial Revolution, something that China is still going through in many ways. China may be one of the largest economies in the world, but it is still a developing nation that at times is held to unrealistic standards. It takes years, decades even, to modernize both the workforce and the laws that govern it.
Furthermore, lets not forget that China is not a capitalist democratic republic, like America. While I agree that its not fair to the workers in China, its also not fair to hold Chinese companies and factories to foreign standards. It is a form of economic extraterritoriality, whereby foreign owned businesses are expected to govern themselves according to the standards set by their home country, and not the country the factory is in.
Compared to other factories in China, Foxconn is a beacon of progress. Compared to factories in the First World, it is still deficient. I have seen working conditions in both America and China with my own eyes. Yes, American conditions are waaay better, but the Chinese ones are improving. We can't expect a complete overhaul overnight. We can pressure Chinese companies to improve but we can't force them to move to quickly or they will collapse.
The attention that this receives is greater than it deserves, largely due to the fact that it is a prominent company producing a popular product. The computer I'm writing on right now was made in China, but we don't hear reports about Gateway factories not living up to our expectations.
Let me sum up my arguments. Conditions at the Foxconn factories are not great, but they have improved and are above the industry standard. For China. China is making great progress in terms of benefits, wages, and workers rights, but its a slow process that will take years to complete. In America, we have the benefit of more than 100 years of industrialization to learn from. We have unions to protect workers. We also have representative government and the Whopper. It is unrealistic at this point to hold Chinese businesses to American standards.
Now I know what you're going to say. "But Dave, Foxconn is an American owned company" Yes, but it is not located in America and therefore not governed by the same laws and standards.
Wow, this post got serious. I just wanted to poke fun at the fact that labor laws exist in China and I ended up ranting about the lopsided expectations. What are your thoughts? Do you agree with me? Do you know think I'm a fascist A-hole? Let me know, that's what the comments section is for. Maybe we can have a lively debate.

1 comment:

  1. Wow. A little too serious for me. On the other hand,despite the lack of biting sarcasm, this is a lesson in Capitalism 101. I, as the customer, can buy from any manufacturer I want. My choice is determined by price, and perhaps working conditions and other considerations. Apple products are among the most expensive in the market. They're still flying off the shelves at list price so price is not the overriding decision point. Part of the Apple aura is their image as innovative developers and manufacturers. If that image is tarnished by factory working conditions, then, in order to keep sales, and revenues, growing Apple must take appropriate action. There must be real changes made and the consumer must be made aware of them. Apple's actions might encourage other well known and regarded companies to do the same. It's not the American government driving the change but the American consumer. Since China's economic growth is driven by exports, and since the Chinese government is very much aware of this, Apple's actions, if there are any besides a factory visit, will put pressure an their competitors, and by extention the Chinese government, to do the same.

    You are correct in that this is a slow process and they are just starting. As in most industies it is the consumer's dollars that drive the economy. Americans and Chinese both know this.

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