Waylaid Dialectic

January 16, 2012

Corporate Evil

Filed under: China,Trade — terence @ 6:49 am

In comments to my last post J. writes:

Corporations and the larger, increasingly global corporate state is evil. Full stop.

I’ve always been uncomfortable applying the word evil to very broad categories, such as ‘corporations’. But his comment reminded me of one other important point about global businesses and global trade: the issue is not purely economic, political economy is deeply important too.

There are no such things as free markets or free trade. Markets and trade always occur embedded in institutions – laws and norms that form the rules of the game. And these rules can make things considerably better or worse for workers above and beyond the pure economics of what is occurring. If you get good, fair rules workers will typically benefit most from trade. The trouble is that in countries such as China the rules aren’t good or fair. What’s more, the fact that they’re not good or fair reflects in part the impact of lobbying from business groups. Here’s Johann Hari writing in 2007.

Last year, the Chinese dictatorship announced a new draft of labour laws designed finally to allow Chinese workers like her – too late – some basic rights.

The new law would permit people like Lan and Meiren to join trade unions. It would give them the right to a written contract. It would give them the right to a severance payment. It would give them the right to change jobs freely. Where previously China’s labour rules were diffuse, dispersed and barely enforced, now they would be drawn together and backed with big fines.

The dissident-killing Chinese Communist Party didn’t propose this change out of a sudden flush of benevolence. They did it because the Chinese people have in increasing numbers been refusing to be tethered serfs for the benefit of Western corporations. Last year, there were 300,000 illegal industrial actions in China, a huge spate of “factory kidnappings” of managers, and more than 85,000 protests.

The Chinese people were showing they did not want to leap from a Maoist gulag to a market-fundamentalists’ sweatshop. They demanded a sensible compromise: strong trade and markets to generate wealth, matched by strong trade unions to stop markets devouring them. They want an end to grinding poverty, but one that doesn’t kill them as they get there.

But they bumped into a huge obstacle. Groups representing Western corporations with factories in China sent armies of lobbyists to Beijing to cajole and threaten the dictatorship into abandoning these new workers’ protections.

The American Chamber of Commerce – representing Microsoft, Nike, Ford, Dell and others – listed 42 pages of objections. The laws were “unaffordable” and “dangerous”, they declared. The European Chamber of Commerce backed them up.

Like I said, I have some trouble with the word ‘evil’, but lobbying China to be more repressive? That’s evil if ever I saw it.



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