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The world-wide gap between rich and poor is “vast and growing.” That’s according to a recent report by the International Labour Organization. Apparently, the ever-expanding reach of corporations and large companies hasn’t brought shared prosperity along with it.

Yet, if you ask the companies themselves, they will tell you that their companies are doing all the right things: offering good jobs and a route out of poverty for factory workers, investing in the local communities in which they operate, and helping protect and sustain the environment.

There is even a movement in place known as Corporate Social Responsibility by which companies communicate to consumers all the amazing things they are doing.

All of which is great, honestly. Companies should feel the need to do good things for the world, to give something back for all the profit they rake in, and to ensure that those profits aren’t earned by keeping other people down or by exploiting the environment.

The trouble is that there are very few ways for the consumer to identify genuinely responsible corporate behavior versus marketing schemes that emphasize relatively small “good works” as a smokescreen for fundamental irresponsibility.
Through the Ethix Merch “CSR Scorecard” we’ll be digging into some of the claims that companies make about their impact on people and the planet, with the goal of helping our readers separate the wheat from the chaff. This time around we’re looking at Econscious and Unionwear.
 

Econscious

As you can see, Econscious has a beautiful, user-friendly website, much of which is dedicated to their corporate social responsibility efforts. Among their laudable claims are an entire line of organic cotton products. They also claim that "social equity" is central to their business practices, which they define as, "paying employees a decent wage, offering a safe and healthy work environment, and encouraging employees to grow in their work and their lives."

So, if you take their word for it, Econscious is taking giant strides to protect the environment and to ensure that employees share in the prosperity resulting from globalized manufacturing.

It all looks extremely impressive, and some of it surely is. But when you dig underneath the surface of the site, despite all of the bells and whistles, there is very little in the way of verifiable assurances that any of the claims about labor practices are accurate. Without such assurances, it is reasonable to assume that their operations may very well be contributing to the “vast and growing” inequality identified by the ILO.

When it comes to certifying their products as organic, Econcious is above board. The reason we can be assured of the veracity of Econscious's claim on this front is their certification by the U.S. Department of Agriculture, backed by the force of law.

With regard to its labor claims, however, Econscious is on much shakier ground. One one of their factories (the one that makes organic caps) is independently certified, in this case by the Worldwide Responsible Apparel Production certification program. However, the problems with WRAP are many, including:
• There’s a large percentage of garment industry executives on the board
• Factory audits are not made available to the public
• Even if you assume that certified factories are legitimately compliant, certification standards don’t require wages above the legal minimum, which in many countries keeps workers in perpetual and abject poverty.

Econscious is also certified by Green America which, like WRAP, does not make specific information about compliance available to the public.
 

Unionwear

 
Like Econcscious, Unionwear offers a wide selection of certified organic products.Also like Econscious, Unionwear makes laudable claims about its labor practices.

There is much less information about Corporate Social Responsibility at Unionwear than you’ll find at Econscious, and no affiliation with common CSR projects like "1% for the Planet."

However, Unionwear's claims about labor conditions are backed by much more powerful assurances.

First, Unionwear's factories are all located within the United States. The “Made in USA” tag reminds us that Unionwear is not a subcontractor. If you want to see the plant where the products are made, just hop on a bus or a plane. If you don’t like what you see, you can make your own educated choice about whether or not to support the company.

Secondly, and most importantly, Unionwear's workers are represented by a trade union (UNITE)

The union label tells us that: 

1.  Experts in the apparel field have researched and collectively bargained for a fair and living wage for the workers,
 
2.  All of the workers have medical insurance and retirement plans provided by their contract, and
 
3.  If workers experience exploitative or dangerous conditions in the factory, they have bargaining power and a powerful megaphone (provided by the union international) through which they can shout these abuses or use a democratic civil legal system to have their claims adjudicated.

Union representation takes labor conditions out of the back rooms, out of the shadows.

Look out for more editions of our "CSR scorecard" soon.

In 1992, Ross Perot foretold of NAFTA causing a grand migration of jobs to Mexico to emit a "giant sucking sound." I started Unionwear the month Perot made that famous prediction and spent the next few years second guessing my career choice.

Q. So why don't I ever see apparel labelled "Made in Mexico?"

Step 1: The law of supply and demand met the law of unintended consequences

Legend has it that immediately after the passage of NAFTA, US agribusinesses began flooding the Mexican market with cheap corn and other farm products. This drove Mexican farmers out of business, and North in search of factory jobs faster than American maquiladoras could be deployed along the US-Mexico border. The supply of cheap labor outpaced the demand for it, and real wages began shrinking. Desperate, Mexicans began illegally crossing the border where they were able to find work building and maintaining the houses built during the real estate bubble and filling entry level positions in the burgeoning service economy.

Step 2: Natural selection meets adverse selection

In 1995 I was kibitzing with Milty, an avuncular garmento across the aisle at M.A.G.I.C., a Las Vegas Menswear Convention. He had just pulled the plug on his Mexico operations and decided to move it to China. "Mexicans are not like Americans. They worked until they made $200 then they would quit and go back to their villages. We could never get any momentum." An agrarian worker content with seasonal employment must have seemed odd to Milty. His grandparents probably uprooted their lives at the turn of the century in order to escape a permanent struggle with survival. They came to America and contributed to a gene pool already wired to chase dreams. As we broke down our booths, Uncle Milty tossed me a sample shirt I had been eyeing. "Do yourself a favor. Don't wash the f:)kin' thing."

When manufacturers began deploying maquiladoras right on the US border they begged for what the health insurance industry terms "adverse selection" in their labor pool. The $10 per hour US jobs across the border attracted Mexicans with the drive to go there, the planning and stamina necessary to get there, the skills to stay there, and the persistence to return if necessary. Those left behind toiled in miserable, unsafe sweatshops for $1 per hour or less and left as soon as they got the chance.

So you know what these maquiladoras got for $1 per hour? Labor that was worth... $1 per hour. This didn't last long. Whole factories and industries started disappearing to Asia, where employers didn't have to compete with the American Dream next door or contend with pesky labor laws or monitors.

Q. Now jobs appear to be returning to Mexico from China. Is this good for the US economy?

Mexico is "local" compared to China. Tijuana is certainly more local to Los Angeles than New York is. Local means more oversight, less environmental damage, and a more direct connection between labor and consumer. Opportunities in Mexico at a time of little opportunity here explains why undocumented workers are returning to Mexico. Manufacturers in Mexico are more likely to use US made parts, particularly under NAFTA. Rebuilding Mexico's supply chain infrastructure after it was gutted by companies relocating to China will also help US manufacturers who import parts.

A "lean" US manufacturer can compete with Mexican manufacturers as long as a weak immigration policy continues to result in adverse selection of Mexican labor. We can't, however, compete with an economy like China's with a low wage workforce, held at gunpoint, that grows by 30 million annually. The original intent of NAFTA was to bring wages in Mexico up to the level of America's wages, and develop a true, viable trading partner and net buyer of our exports. That is a lot more likely to happen now.

And when that happens, work -- not workers -- will be returning to El Norte. 

Free trade is defined as the ability for a buyer and seller to conduct business without government interference.    So when the government is the buyer why can't it freely choose who to buy from without incumbent sellers claiming interference with free trade?

I have a solution to this loophole-infected quagmire: Scrap protectionist language and simply require sellers to the US, state and local governments to comply with US labor law regardless of where the goods are made. 

A recent NY Times Editorial about the "Buy American" bill is a perfect example of how easily the razzle of "Free Trade" can dazzle the journalistic integrity of our last great voice of skepticism.

Sometimes it’s nice to stop pushing for a minute and recognize that, indeed, the “arc of the universe...bends toward justice.”

Despite (or perhaps even partially because of) the passage of California’s Prop 8 last November, much progress has been made of late in the long struggle for LGBT rights. Just this year, the number of U.S. states to legalize gay marriage jumped from two to six. And this week, President Obama announced that federal employees will be permitted to share some of their benefits with same-sex partners. (Allowing same-sex partners to share full health benefits will require legislation.)

An often-overlooked benefit of this particular civil rights movement is that it obliterates lines of class, ethnicity, race, geography and politics. While a white, heterosexual couple is probably not going to produce an African-American child, they could very well produce a gay one. Homosexuality can be a tremendously effective reminder of the diversity that defines our species. You simply can’t run away from it, so even if it makes you uncomfortable, you may as well learn tolerance and, eventually, appreciation for all kinds of people.

Former Vice President Dick Cheney is a case in point of someone who probably had to overcome significant personal reservations in order to make room in his heart for his openly gay daughter. The fact that he has come out publicly in support of gay marriage speaks volumes about the potential for a widening circle of compassion.

This circle needs widening even among progressives, however, as the current struggle for gay rights is going to show. The fallout from Prop 8 created tension in California between two historically oppressed minorities – gays and African Americans – when some in the gay community publicly lashed out against African Americans, approximately 6 in 10 of whom supported Proposition 8. California Assembly Speaker Karen Bass argued that “No on 8” advocates failed to outreach in a significant way to African-American members of the LGBT community, that this oversight needlessly reminded African-Americans of the history of white racism, and that the resulting tension cost the campaign valuable momentum.

The fight for equality for same-sex couples goes on, of course, offering more opportunities for many different communities – each with their own LGBT community within it – to work together and in so doing, to create bonds that last from movement to movement.

The upcoming Pride Parade in San Francisco is one such opportunity. We were excited to get a call from a group of Jews (both LGBT and their straight allies) representing synagogues and mainstream Jewish institutions across the Bay Area, looking for sweatshop-free t-shirts that proclaim their solidarity with the LGBT marchers.

Working on this project has been extremely rewarding because of the forward progress it represents in so many different areas: recognizing our role as consumers in creating justice for workers around the world whom we may never meet; resisting complacency when the rights of others hang in the balance; and proudly adhering to one’s own cultural identity while simultaneously pushing on that culture to embrace diversity.

The parade is June 28th, so be sure to come back here to check out the photos of hundreds of Jews marching for LGBT rights, wearing sweatshop-free t-shirts. Meanwhile, here are some links to read about the “Jews March for Pride” project.

About Jews March for Pride

How to Get Involved

And here are links to the specific Jewish groups that will be standing against sweatshops while they march for LGBT rights: 

Jewish Community Relations Council

Jewish Community Federation of San Francisco

Temple Sinai of Oakland

Congregation Emanu-El of San Francisco

Looking for some good economic news? Look no further than US Manufacturing.  China's advantages in manufacturing have all but eroded  according to Business Week.    The US Trade Deficit sank to a ten year low.  And all sorts of indeces are pointing to an impending expansion in domestic manufacturing ahead of the rest of the economy.  This is such positive news I'm hesitant to even mention it.  At this point my grandma would chide me for begging the evil eye to come and knock my optimism down a peg, and attempt to ward it off with a medieval Yiddish spell ("kinna hurra").  What's happening and why?

Legislation Levels the Playing Field

Red state laborers will finally make as much as their blue state counterparts next month, when the Federal Minimum Wage is raised to $7.25. Most of the blue states, ours included, had already raised their legal minimums to that level years ago, but a map of the states still slumming it at the Federal Minimum Wage is basically identical to the 2008 map of states won by John McCain, proving once again that the more someone needed a change, the less likely they were to vote for it. What IS the matter with Kansas?

What a great image: nurses at Parkview Community Hospital in Riverside, California, signing their first union contract and proudly wearing union made and union printed t-shirts.

Congratulations to Parkview RNs and the UNAC/UHCP on this milestone, and thanks for extending your support to union printers and garment workers.

SweatFree Communities is the leading anti-sweatshop organization in the United States. Their Executive Director, Bjorn Claeson, answered some of our questions about the state of the movement, nearly halfway through 2009.

Ethix Merch: What has been the single most important development in the fight against sweatshops in the past year?

Bjorn Claeson:

Well, I would like to say it’s been the development of the Sweatfree Purchasing Consortium because it creates a substantial market for decent working conditions as well as an effective tool for workers to enforce their rights. But, the Consortium is not yet far enough along to qualify as “the most important development in the fight against sweatshops.” (Ten cities and states have committed to join so far and with a little bit of luck it will start doing monitoring work within the year).

Considering the question through U.S. lenses I would have to say that the campaign against Russell has broken new ground as scores of universities have cut their contracts with Russell in the face of overwhelming evidence that it shut down a factory in Honduras rather than recognizing workers’ choice to have a union represent them. This campaign has certainly been the most visible anti-sweatshop campaign in the United States over the past year. I am somewhat reluctant to say this protest campaign has been “the most important” because I think we ought to be able to implement positive solutions of equal magnitude. However, the Russell campaign has succeeded in something very important: building consensus that cutting and running from workers who are organizing a union is unacceptable behavior. We can build on that.

Ethix Merch: In recent years, the movement has focused on utilizing the leverage of large consumers like states, cities, universities, and school districts. While these projects develop, how can individuals help the cause?

In a related question, do you think it is realistic for consumers to buy only guaranteed sweatshop-free clothing for themselves and their children, or should they focus on supporting the movement in other ways?

Bjorn Claeson:

First of all, most of us – and I include myself here – should buy less of everything, period. When we do buy, we owe it to workers, to the earth, and to our future generations to pay a fair price so that others do not need to absorb the true cost of production by living in abject poverty, working when sick, and enduring unhealthy workplaces. Unfortunately, we have built a global economic system that requires producers to externalizing the cost of production to the weakest and most vulnerable among us, including our planet. So it is not easy to pay a fair price. We have to work against the system. Just as companies scour the globe for the cheapest possible labor, we have to scour the aisles—so to speak—for products that are union made or made by worker-owned cooperatives. We should buy organic-certified cotton as much as possible. We should consider buying products that are made locally and haven’t been transported half-way across the globe before we get them. We need to reduce the distance between consumer and producer both geographically and economically. Look at it that way and shopping is activism. We have a tool to promote shopping as activism—the Shop with a Conscience Consumer Guide. There are many other tools. The important step is to think when we buy. Is this purchase necessary? And if so, how does it impact the earth and the workers?
 

Beyond shopping? Yes, of course. There are many, many ways for people to get involved and strengthen the anti-sweatshop movement. I would suggest that people consider ways to build activism into their daily lives. How can you educate the members of your church or school? Can you get your company to buy logo-apparel made by union workers? Can you join or start a group for your city to buy only sweatshop-free apparel? There is no end of possibilities.

Ethix Merch: In a recent column, Nicholas Kristof of the New York Times defended sweatshops, writing:

"Among people who work in development, many strongly believe (but few dare say very loudly) that one of the best hopes for the poorest countries would be to build their manufacturing industries. But global campaigns against sweatshops make that less likely."

How would you respond to this particular argument?

Bjorn Claeson: 

Kristof assumes that industrial development ineluctably leads to a better standard of living, that second generation factory workers will be better off than first generation workers. But he ignores the economic system within which industry develops, a system based on low-cost production requiring factories to operate as sweatshops in order to be successful. Garment factories in Central America or Asia are every bit as oppressive today as two decades ago. The anti-sweatshop movement is not trying to deny the opportunity of industrial development to certain countries—it has never been a boycott movement. Instead, it is working to change the system of production so that factories that pay workers a living wage and respect workers’ right to organize are favored rather than disfavored, so that industrial development can actually produce a middle class.

Ethix Merch: How would you rate the Obama administration’s first few months, when it comes to sweatshops? Going forward, are you optimistic about the role of the U.S. government in combating sweatshops here and abroad?

Bjorn Claeson: 

I am not in a position to rate Obama’s actions on sweatshops just yet, but here is at least a beginning of an agenda I would propose to the administration: 1) Speak out in support of unions and the Employee Free Choice Act. With EFCA workers have a better chance to turn U.S. sweatshops into decent places to work. 2) Fully fund the U.S. Department of Labor workplace investigations to discover and remedy violations of the Fair Labor Standards Act. 3) Turn the ship of trade around. No more WTO and NAFTA model trade agreements in which labor standards are at best unenforceable and at worst seen as a hidden obstacle to trade. Advocate for the T.R.A.D.E. Act. 4) Enforce and then expand Clinton’s Executive Order banning federal purchases of products made by forced and indentured child labor. First, add transparency requirements and add investigatory capacity. Then expand the purchasing ban to products not made in accordance with international core labor standards. 5) Fund the Sweatfree Purchasing Consortium to help all government agencies end purchasing from sweatshops.

Let’s check back in a year from now.

Ethix Merch: As challenging as it has been to pass sweat-free procurement ordinances in states and cities around the country, it seems that enforcement of these ordinances has been inconsistent. Why aren’t more of these ordinances enforced, and what is being done about it?

Bjorn Claeson: 

Enforcement is a tremendous challenge because there is hardly any supply of sweatfree uniforms and other apparel for government agencies to buy. Buying sweatfree is not the same as buying recycled paper, fair trade coffee, or organic cotton shirts when you can just check the label and buy accordingly. Buying sweatfree is a process of transformation where government agencies use their purchasing power to create transparency, investigate working conditions, demand change, and, eventually, designate sweatfree suppliers. It’s a lot of hard work in the early stages especially. The only way forward is collaborative. That is why we are focusing on creating the Sweatfree Purchasing Consortium to give governments real monitoring and investigative capacity. We also encourage companies like Ethix that truly seek to comply with sweatfree standards to get into the government procurement market. It’s not going to be easy in the beginning, but we need to show government purchasers that they do have options.

Ethix Merch: During the sweatfree communities conference in 2007, a link was drawn between sweatshops in the garment industry and "sweatshops in the field." Are partnerships continuing between SFC and organizations like the Coalition of Immokalee Workers?

Bjorn Claeson: 

You know, not as much as I would like. We learned a lot from the CIW and their demands for supply chain transparency and fair pricing—their penny more per pound campaign. The solutions for sweatshop workers in the field and in the factories are similar. But whether it is because of lack of resources or other reasons we have not maintained more than occasional contact.

Some things just aren’t done, and when they are, you just have to cringe. Like putting ketchup on a Chicago hot dog, or wearing socks with sandals. Fortunately, most of our fair fellow citizens have figured these out by now, and violators are quickly shamed into compliance by the aforementioned cringing.

Other things should be faux pas, but for some reason haven’t yet become so, and people get away with them all the time. One example of such a “future faux pas” is taking a call on your cell phone, thus leaving your lunch partner to play with coffee creamers while pretending not to listen to one side of your boring conversation.

Another overlooked faux pas is when quintessential American institutions get besmirched through an association with imported, unethically made merchandise. When I walk into a gift shop at Yellowstone National Park, I want to buy a t-shirt. (No, I don’t care that it looks like this. I want it anyway.) But I want my Yellowstone shirt to be made in America, dammit! I’m sorry but a shirt with a cowboy, an American bison, and a Native American in full headdress on it just can’t be made in China.

In virtually every case you can imagine, logo gear for our beloved American institutions is manufactured overseas, using foreign components and foreign labor. How about Major League Baseball? You think they support solid, American middle class manufacturing jobs? Think again. Apparently our garment workers don't get to participate in our national pasttime. What about the Samuel Adams E-store? Mount Rushmore? The St. Louis Arch? Nope. (Although I was told by the people at the Mount Rushmore store that they have one Made in USA apparel item - out of 25 total options - but it is not yet available on their website.) 

What gives?

Look, I don’t have blinders on, and I understand that the vast majority of merchandise is now made outside this country. And, of course, imports are not inherently bad. But there are certain times and certain places to make a statement…and logo gear that literally promotes America is the place, if there ever was one, to proudly show that we – the workers of America - can make t-shirts, mugs, and tote bags right here, and furthermore that we can do so while paying a living wage and respecting the right of our workers to organize into a union.

That statement would show that we are serious about protecting workers and the American dream. Eventually, no product made under sweatshop conditions should be sold within our borders. That day is a long way off, but long journeys are nothing more than a bunch of little steps.

Please contact the above locations (or any others you know of), point out their fashion faux pas, and encourage them to source from guaranteed sweatshop-free sources like those that are available at Ethix Merch.

Note: In my perusal of various e-stores selling Americana, I did come across one garment that was proudly labeled "Made in USA" (though most likely not union made). Here it is: 

Central Park Ladies Tee

Before the break up of Ma Bell in 1986, long distance phone calls used to cost a fortune.  Then competition like Sprint and MCI drove down the cost of long distance, and by the 1990s long distance calls were less expensive than local calls.  But that is still news to my grandmother, who to this day will not talk on the phone to another area code for more than 59 seconds.

Our former plant manager was similarly phobic towards overtime pay, prohibiting it under any circumstances. And I never questioned him--after all, with our labor costs so high to begin with, how could we possibly make any money paying 50% more for the same work?  A year after he retired, we faced a tremendous temporary surge in business--providing both 2008 presidential candidates with hats and bags.  We had to make a quick decision--do we hire 20 more sewing operators, or give 80 of our operators the chance to (voluntarily) work an extra 10 hours a week at time and a half?  I don't know what drove me to "do the math"--on the surface it seemed that hiring the cheaper new operators would be a no brainer--but the answer actually astonished me.

The first thing I noticed was that our regular time was actually costing us more than time and a half.  Besides the 11% federal employer portion of taxes, we had 3% for workers comp, 3% on our pension contribution, and 1% on city taxes--an 18% vig to the system.  Then there was 25 days of unworked pay: 10 holidays, 10 vacation days, and 5 personal and sick days, all subject to the 18% vig. When amortized over the other 236 weekdays in the year it meant 12.5% of every dollar of regular pay went to fund unworked pay. Finally, our health insurance costs worked out to $2.22 per regular hour worked, or 22% of a $10.00 wage. We also gave production bonuses averaging $.75 per hour, or 7.5%.

So regular pay was costing us 60% more than the gross wage. How does that compare to overtime?  The health insurance, unworked pay, and pension were all paid for by regular time--they don't increase with overtime. We don't give production bonuses on overtime hours, and in our state workers comp is not charged to overtime hours. That just leaves the 12% in payroll taxes, plus the "and a half" premium (also subject to 12%)--a total of 68%.  

So all things being equal, overtime was costing just 5% more (168%/160%) than regular time per hour for the same employee.  But all things are not equal--because when overtime is necessary, the alternative is hiring a new employee, training them, replacing them, training their replacement, then letting them go when demand goes back down before they reach their full potential. They may be a couple of dollars cheaper, but for the first few months they add so much less value and require so much more high labor cost supervision.

Another argument against overtime is that it fatigues the workers. What we discovered was that a number of our workers had second jobs that they gave up because they were making more in ten hours of overtime than they were in twenty hours of their part time second jobs.  One of the great benefits of voluntary overtime pay is that so much more of the payroll costs ends up the employees pockets. If an employee is making a just over a living wage, overtime can multiply their discretionary income many times over.

In this recession I regularly read about companies who cut back hours to save labor costs. In the scenario above, a $10 worker costs the company around $16 per hour whether they are working regular time or undertime.  However, if their hours are cut back to 32 hours per week, that means that health insurance and unworked pay are amortized over 20% fewer hours--so labor costs per hour increase significantly.  Employees may be sacrificing to share the pain, but both companies and employees always lose out when workers don't work at least 40 hours.

So the bottom line--don't fear overtime--it doesn't cost a company any more than regular time, and it may cost a lot less.