“The problem with sweatshops is that there are not enough of them”, this is an area under discussion inside the society of the 21^st century. A society which is global and not local anymore under the umbrella of globalization, a society which is responsible to take advantage of all the opportunities for development that are raising everyday inside the global village and at the same time has the moral obligation to protect its people from the danger of a sacrifice of human rights on the altar of globalization.

Many people support the opinion that the existence of sweatshops in the 21^st century is good and absolutely necessary but on the other hand a major part of the society is against and believes that the existence of sweatshops has to stop. In the next paragraphs the author of this study will aim to analyze this subject for discussion through the presentation of the arguments of both sides and will reveal his spot in the map of the global society through the expression of his opinion.

“The overwhelming mainstream view among economists is that growth of this kind of employment is tremendous good news for the world’s poor”.

Paul Krugman, economist
(Allen R. Myerson, “The world; In Principle, a Case For More ‘Sweatshops’,” The New York Times, June 22, 1997, section4, page 5)

“There are not too many sweatshops but there are too few”.
Jeffrey D. Sachs, economist
(Denis G. Arnold and Laura P. Hartman, Beyond sweatshops: Positive deviancy and global labor practices, page 4, available at: www.isbee.org/index.php?option=com_docman&task=doc_download&gid=21 -)

These two economists and many others believe that the creation and the continuation of sweatshops invariably improve the situation of those affected by them (developing countries, via the reduction of the unemployment and its affects; sweatshop employees, via higher wages than they would otherwise receive; consumers, via lower prices for sweatshop goods; and MNCs and their shareholders, through lower labor costs). (Denis G. Arnold and Laura P. Hartman, Beyond sweatshops: Positive deviancy and global labor practices, page 4, available at: www.isbee.org/index.php?option=com_docman&task=doc_download&gid=21-)

Positive effects on developing countries.
There are many positive effects on developing countries. First is the creation of jobs, which is the main reason why developing countries encourage the existence of sweatshops seeking to attract multinational companies. Furthermore multinational companies through sweatshops pay taxes and so provide revenue for the host country’s government. In addition in order to produce more goods in less time, multinational companies, supply the sweatshops with high-tech machinery and bring improved production processes, which may be transferred to local firms and raise productivity levels. It is recognized that the countries which join globalization having no restrictions regarding sweatshops or other forms of foreign direct investment can achieve high rates of GDP growth, reduction of the inflation rate and swell up the its trade surplus. An example of this can be China or India which were among the first countries to follow the wind of globalization and today have the benefit of high GDP growth, reduced inflation rate and swelled trade plus.

Source: The Economist, The World in 2007, 21^st edition, pages 100-101
Positive effects on multinational’s company parent country.
According to McKinsey Global Institute, the multinational’s company parent country wins a lot when this company moves offshore even if this foreign direct investment has to do with the service industry or the production of goods. (McKinsey Global Institute, Exploding the Myths About Offshoring, Martin N. Baily, Diana Farrell, April 2004, pages 2 up to 6)

Here is an example of how the U.S. benefits from this situation:

Corporate savings. For every dollar of corporate spending that moves offshore, U.S. companies save 58 cents. Companies can reinvest that savings in new business opportunities, pay additional earnings out to shareholders, or both.

Additional exports: At McKinsey Global Institute, they estimate that for every dollar of corporate spending that moves offshore, suppliers of offshore services buy five cents’ worth of goods and services from the United States.

Repatriated profits: Four cents of every dollar spent on offshoring returns to the United States economy.
Productivity and new jobs: Corporate savings can be invested in new business opportunities, and this investment will boost productivity as well as create new jobs.

Positive effects on consumers

Consumers either within the host country or on a global basis can benefit from the increase competition and the reduction of the prices. According to a research by Catherine Mann of the Institute for International Economics found that global sourcing of components in the computer hardware industry has reduced the cost of IT hardware by much as 30 percent, thereby boosting demand and adding up to $230 billion to U.S. GDP since 1995. (McKinsey Global Institute, Exploding the Myths About Offshoring, Martin N. Baily, Diana Farrell, April 2004, page3)

Positive effects on employees

Nicholas Kristoff and Sheryl Wudunn in their New York Times article “Two Cheers for Sweatshops” (September 24, 2000) assert that sweatshops offer workers in poor countries a path to prosperity. Workers like the opportunities that sweatshops provide: pay is higher than at any alternative job and the money earned allows them to purchase medicines and send children to school. (The Case Against Sweatshops, Anna Yesilevsky, The Humanist, May/June 2004, 64, 3, Academic Research Library, page21)

As the business map is changing rapidly, sweatshop working system is moving towards them through a rapid but also rigorous change according to working conditions and salaries. Nowadays is observed, companies like Nike or Adidas, that in the past many people and non - governmental organizations had accused them for violation of human rights, to improve working conditions and wages for the employees of sweatshops.

For example, Nike’s Chief Executive Officer Phil Knight at a speech at the National Press Club in 1998 accepted responsibility at the corporate level for the labor activities of its suppliers by establishing six initiatives for the firm. (Phil Knight, “New Labor Initiatives”, speech delivered to the National Press Club, Washington D.C., May 12, 1998).

Knight explained that, as of that day, Nike committed to:

• Increasing the minimum age of new footwear workers to 18, and the minimum age for all the other new light – manufacturing workers (apparel, accessories, equipment) to 16;
  
• Adopting the personal exposure limits (PEL) of the U.S. Occupational Safety and Health Administration (OSHA) as the standard for indoor air quality for all footwear factories;
  
• Funding university research and open forums to explore issues related to global manufacturing and responsible business practices such as independent monitoring and air quality standards;
  
• Expanding worker education programs, including middle and high school equivalency courses, for workers in all Nike footwear factories;
  
• Increasing support of its current micro – enterprise loan program to 1,000 families each in Vietnam, Indonesia, Pakistan and Thailand;
  
• Expanding its current independent monitoring programs to include NGOs, foundations and educational institutions and making summaries of the findings public;
  
• Involving NGOs in the process of factory monitoring, with summaries released to the public.
  In September 2001 Knight and Nike’s Board of Directors created a Corporate Responsibility Committee of the Board. The committee has the responsibility to: review, report and make recommendations to the full board regarding Nike’s alignment with corporate responsibility commitments.
  According to Denis G. Arnold and Laura P. Hartman, at their research “Beyond sweatshops: Positive deviancy and global labor practices”, sweatshop is any workplace in which workers are typically subject to two or more of the following conditions: systematic forced overtime; systematic health and safety risks that stem from negligence or the willful disregard of employee welfare; coercion; systematic deception that places workers at risk; underpayment of earnings; and income for a 48 hour work less than the overall poverty rate for that country (one who suffers from overall poverty lacks the income necessary to satisfy one’s basic non – food needs such as shelter and basic healthcare). (Denis G. Arnold and Laura P. Hartman, Beyond sweatshops: Positive deviancy and global labor practices, page 35, available at: www.isbee.org/index.php?option=com_docman&task=doc_download&gid=21-)
  Furthermore, Pietra Rivoli, asserts that sweatshops are accused of (Pietra Rivoli, Labor standards in the Global economy: Issues for investors, Journal of Business ethics, 43, pp224- 226):
  
• Low wages: Perhaps the most defining characteristic of a sweatshop is low wages.
• Lack of health and safety standards: There is a great absence of health and safety standards in sweatshops. The lack of fire safety has become a common cause for concern in many sweatshops. Particularly in Asia and in a number of cases, blocked fire exits have resulted in deaths and injuries (Varley, Pamela (ed) 1998 The sweatshop Quandary/ Corporate Responsibility on the Global Frontier, investor responsibility Research Center, Washington D.C., pp66 – 67). Furthermore in shoe and toy factories, exposure to toxic materials under conditions of pure ventilation may represent a threat to workers’ health. Also the availability of potable water is a very serious issue to concern. In factories with dormitory facilities, the safety and cleanliness of the living facilities have also been criticized by some observers(Pietra Rivoli, Labor standards in the Global economy: Issues for investors, Journal of Business ethics, 43, pp226)
  
• Restrictions concerning association: In developing countries those who work in apparel and toy factories are not represented by independent unions. (Pietra Rivoli, Labor standards in the Global economy: Issues for investors, Journal of Business ethics, 43, pp224- 226)
  
• Child labor: Child labor and the worst forms of child labor, as defined By the International Labour Organization (ILO) Conventions, damage children’s health, threaten their education and lead to further exploitation and abuse. Child labor has been widely reported in the textile and apparel industries, particularly in Pakistan, India, and Bangladesh. (Hobbs, Sandy, Jim McKechnie and Michael Lavalette: 1999, Child Labo: /A World History Campanion (ABC – CLIO, Santa Barbara). 
  

The status of some sweatshops is so doubtful as to be called modern slavery by the American Anti Slavery Organization. Also Steve King says in an article that a sweatshop is a form of modern slavery. (The Economist, The World in 2007, 21^ST edition, page94). Slavery is like polio. Most westerns associate it with earlier, darker times in human history. Its eradication is a sign of human progress. And yet despite these perceptions slavery, like polio, has not in fact been eradicated. (http://www.economist.com/agenda/PrinterFriendly.cfm?story_id=3737154 28/12/2006).
For example, the union of the Disney Niagra plant workers supports that, their human rights are violated, the working conditions are bad and their wages are touching the poverty. (http://www.nlcnet.org/campaigns/niagra/niagra-bangladesh.pdf 28/12/2006)Furthermore in “Slavery: Worldwide Evil”, posted on iAbolish.com, Charles Jakobs writes. (The Case Against Sweatshops, Anna Yesilevsky, The Humanist, May/June 2004, 64, 3, Academic Research Library, page20):
“Locked in a room and given no food until the agreed to weave on the looms, Santosh made Oriental carpets for nine years, working from 4:00 in the morning to 11:00 at night, every day, without breaks. He was never given a single rupee for his labor. When he cut his finger with a sharp tool, the loom master shaved match heads into the cut and set the sulphur on fire. He did not want the child’s blood staining the carpet.”

Even though most sweatshops stop short of such whole sale exploitation, human rights violations are barricade and work conditions are definitely poor. Workers suffer from the absence of safety procedures and quality equipment. Working hours are long and the week is full of work or with only one day stop. Workers are forced to accept the sweatshop lifestyle or suffer even more abject poverty without having a chance to negotiate with the managers of sweatshops for their rights.

Another aspect of the case against sweatshops is corruption. Multinational companies help the corruption to grow in the poor countries in order to continue the existence of sweatshop and exploit the nations natural and human resources. According to the Economist, the most corrupt countries are the poorest and the cleanest are the richest. (The Economist, November 11^th – 17^th 2006, page 69). In China for example, the Chinese lawyers who defend human rights and expose the absence of an independent judiciary are under increasing attack from state authorities. (http://hrw.org/english/docs/2006/08/23/china14064_txt.htm 24/12/2006)

According to many people of the Academic world, corruption has become one of today’s most pressing global ethical problems. (Pacini, C., J. A., Swingen and H. Rogers: 2002, ‘The Role of the OECD and EU Conventions in Combating Bribery of Foreign Public Officials’, Journal of Business Ethics 37(4), pages 385-340, Ryan L 2000, ‘Combatting Corruption: The 21^st Century Ethical Challenge’, Business Ethics Quarterly 10(1), pages 331-338) Corruption is the leader concerning: lost revenues for governments’ incomes (Fjeldstad, O. and B. Tungodden 2003, Fiscal Corruption: A Vice or a Virtue?’, World Development 31(8), pages 1459-1467), declining quality of governance, extra costs to businesses that engage in bribery, and lost opportunities for those that do not. (Caiden, E. G. P. O. Dwivedi and J. Jabbra: 2001a, ‘Introduction’, in J. Jabra (ed), Where Corruption Lives (Kumarion Press, Bloomfield, pp 1-14) It is also believed that corruption harm the values and corrode the respect of law (Hamir M. A. 1999. ‘Keynote Adress’, in K. Frimpong and G. Jacques (eds), Corruption, Democracy and Good Governance in Africa: Essays on accountability and ethical behaviour , Lentswe La Lesedi, Gaborone, Botswana, pp.1-8), result in higher public investment and lower quality of infrastructure(Schools, M. 1998, Combating corruption for development: the role of government, business, and civil society. In transparency international and the international bank for reconstruction and development (ed), New perspectives on combating corruption , Transparency international and the international Bank for reconstruction and development, Washington, pp1-11), and as Klitgaards supposes hold back political and economic advance (Klitgaard, R 1994, ‘Aframework for a country programme against corruption’, in F. Galtung (ed), Accountability and transparency in international development: the launching of transparency international, Laserline GmbH, Berlin, pp55-73) .

In conclusion, such conditions are not only tragic; they are an affront to human dignity and extensive violation of human rights. The author of this study believes that a civilized and progressive society must put moral bargains in order to protect its people from exploitation of their right to live with dignity and must react immediately when this right is in danger. Boycotting the sweatshop’s products is a single action that every single person can do in order to take action against the sweatshops and everything of what they represent. In the 21^st century where everything is changing rapidly and most of the multinational companies want to add extra profits in their balance sheet without caring about people’s dignity, every single person must believe that his or her actions can affect the global society and many things can change because of these.

• Denis G. Arnold and Laura P. Hartman, Beyond sweatshops: Positive deviancy and global labor practices, page 4, available at: www.isbee.org/index.php?option=com_docman&task=doc_download&gid=21-)
  
• McKinsey Global Institute, Exploding the Myths About Offshoring, Martin N. Baily, Diana Farrell, April 2004, pages 2 up to 6
  
• The Case Against Sweatshops, Anna Yesilevsky, The Humanist, May/June 2004, 64, 3, Academic Research Library, page21
  
• Phil Knight, “New Labor Initiatives”, speech delivered to the National Press Club, Washington D.C., May 12, 1998
  
• Denis G. Arnold and Laura P. Hartman, Beyond sweatshops: Positive deviancy and global labor practices, page 35, available at: www.isbee.org/index.php?option=com_docman&task=doc_download&gid=21-
  
• Varley, Pamela (ed) 1998 The sweatshop Quandary/ Corporate Responsibility on the Global Frontier, investor responsibility Research Center, Washington D.C., pp66 – 67
  
• Hobbs, Sandy, Jim McKechnie and Michael Lavalette: 1999, Child Labo: /A World History Campanion (ABC – CLIO, Santa Barbara
  
• Unless otherwise indicated, International Labor Office, The End of Child Labour :Within reach, Global Report under the follow up to the ILO Declaration on Fundamental Principles and Rights at Work, International Labour Conference, 95^th Session 2006, Report I (B), ILO, Geneva, 2006
  
• http://www.unicef.org/protection/files/Child_Labour.pdf 27/12/2006
  
• International Programme on the Elimination of Child Labour, Helping Hands or Shackled Lives? Understanding child domestic labour and responses to it, ILO, Geneva, 2004, PIII
  
• The Economist, The World in 2007, 21^ST edition, page94
  
• http://www.economist.com/agenda/PrinterFriendly.cfm?story_id=3737154 28/12/2006
  
• http://www.nlcnet.org/campaigns/niagra/niagra-bangladesh.pdf 28/12/2006
  
• The Case Against Sweatshops, Anna Yesilevsky, The Humanist, May/June 2004, 64, 3, Academic Research Library, page20
  
• The Economist, November 11^th – 17^th 2006, page 69
  
• http://hrw.org/english/docs/2006/08/23/china14064_txt.htm 24/12/2006
  
• Pacini, C., J. A., Swingen and H. Rogers: 2002, ‘The Role of the OECD and EU Conventions in Combating Bribery of Foreign Public Officials’, Journal of Business Ethics 37(4), pages 385-340
  
• Ryan L 2000, ‘Combatting Corruption: The 21^st Century Ethical Challenge’, Business Ethics Quarterly 10(1), pages 331-338
  
• Fjeldstad, O. and B. Tungodden 2003, Fiscal Corruption: A Vice or a Virtue?’, World Development 31(8), pages 1459-1467
  
• Caiden, E. G. P. O. Dwivedi and J. Jabbra: 2001a, ‘Introduction’, in J. Jabra (ed), Where Corruption Lives (Kumarion Press, Bloomfield, pp 1-14
  
• Hamir M. A. 1999. ‘Keynote Adress’, in K. Frimpong and G. Jacques (eds), Corruption, Democracy and Good Governance in Africa: Essays on accountability and ethical behaviour , Lentswe La Lesedi, Gaborone, Botswana, pp.1-8
  
• Schools, M. 1998, Combating corruption for development: the role of government, business, and civil society. In transparency international and the international bank for reconstruction and development (ed), New perspectives on combating corruption , Transparency international and the international Bank for reconstruction and development, Washington, pp1-11
  
• Klitgaard, R 1994, ‘Aframework for a country programme against corruption’, in F. Galtung (ed), Accountability and transparency in international development: the launching of transparency international, Laserline GmbH, Berlin, pp55-73
  
• The Economist, The World in 2007, 21^st edition, pages 100-101
  

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