Globalization and Running: how much would shoes be if they weren't made by a 9 year old in Thailand?

Ninetonite wrote:

"the companies would find other ways to cut costs (materials, availability) to keep prices close, if not level."

Stupid comment. Don't you think that Nike, the biggest running shoe company in the world, has not already negotiated the very best price on raw materials? The company making the nylon and leather ain't gonna give it away for free??

So, if Nike (and/or any/every other shoe manufacturer) suddenly had to pay $10/hour to get their shoes made then they'd either have to price their shoes so that their market share would be cut dramatically or they'd go out of business? Nonsense. There might be a short-term hit to stock prices, but in the long run they'd be just fine because they know what it takes to succeed in the market, not just because they have some magical power to get the best price for raw materials and underpriced labor. They'd probably scale back marketing campaigns and athlete sponsorships, there are many places where Nike can cut costs besides raw materials, and their margins are such that they can absorb a cut in profit and still operate very healthily.

omg joe walsh is so moneeey

Ninetonite wrote:

The fact that a Nike employee in Taiwan can't afford to buy a refrigerator on what he makes in a year has nothing to do with the cost of refrigerators in Taiwan, it has everything to do with the miniscule wages he is paid.

taiwan is the 13th largest economy in the world. GDP/capita is US$17k/person....its a developed country.

During a research grant trip to Sri Lanka in '91, I saw an export processing zone where they paid (by local standards) extrodinarily high wages - 3-4x what an average factory worker would get. The Sri Lankan government's belief was that this would benefit workers.

They obviously forgot that old phrase from Econ 101 "Extrenalities"

1. Employers hired only women - why? They were much less likely to unionize.

2. There was an accute shortage of housing. The applications to work in the export zone came from all over the country, so those hired were often in need of housing. The result was that rents went sky high, and workers were living 6 to a room in larcenous pig pens.

3. All other goods were more expensive for the outsiders - an informal two-tiered pricing structure emerged for everything.

These lucky workers also had to pay tax. So at the end of it all, they didnt have much more to show for their efforts, except a lot of stress.

Imposing "fair" conditions on the wage-employment bargain sometimes results in unintended consequences. Child labor was a fact of life IN THE US until about 80 years ago. Why is there still 3 months off for school? So kids can go work the fields to bring in the crops. Otherwise...they wouldnt have been able to go to school.

Most children in most of the world do some work from a very early age (a paper route?). Its not a crime to employ them.

but its a crime to employ illegal aliens.

yeah yeah yeah.

my point is that globalization causes a lot of problems. These problems are many;

you think lower prices are a good thing but they are not. They have made this country habitualized to low prices and abundant goods and sevrices. not only that, but those bad habits towards consumption lead corporations, to find yet more cheaper locations for production. They can move all over the world simply because energy costs are low and resources and labor are abundant.

what happens when resources aren't abundant? what happens when energy prices are high? or when labor doesn't have time to work because they're starving when they can't pay for oil for their farms?

Globalization was about as smart as credit cards. Well, they should both end at the same time.

cheers.

I'm not even going to begin to try and address some of the silly statements being made or the oversimplifying models used by others (namely traxor)...

I'll only say that you should be thankful your shoes cost what they do - here in Zurich it is hard to touch any running shoe for under 240 swiss francs ($200)

I toured one of these plants for another reason, but the experience was useful. The plant supervisor I talked to said the most important factor in their decision was frequency of urination. A worker who must urinate frequently is off the line too much. Someone who can hold their pee, or pee in a bottle and dispose of it later, is a much more productive worker.

The children working for nike should be thankfull. The alternitive is selling your self for sex or starvation. Thank god for nike and all the other big companies that allow people to actually have a job and bring home a paycheck. The high minded liberal elites never think of the alternitive. Only what THEY deem to be fair and just.

I love peeps wrote:

what happens when resources aren't abundant? what happens when energy prices are high? or when labor doesn't have time to work because they're starving when they can't pay for oil for their farms?

cheers.

An integrated economy w/ division of labor allows us to have 6bn people. If all of this "global economy" came to a grinding halt, most of these people (~80%) would die. In addition the standard of living of those remaining would take a step back of roughly 500 years.

No vaccines?

No liveable structures in harsh climes?

A life expectancy of 50?

These are good things?

You have no alternative to existing systems, which allows us to moentize human beings' ability to defer gratification.

Spend a month in Jakarta and then tell us what people want. You'll get the same answer as in Kinshasa, Caracas, Lome or anywhere else - a stable job, education for their children. If they can attract capital (a bad thing in your opinion) their wish will be granted. But you would prefer them to return to the jungle like some romatic notion of rousseau's "noble savage".

Your notions are elitist and patronizing. You know nothing of how people in developing worlds think or what motivates them.

Didn't we outlaw child labor over 100 years ago because we found it to be immoral? Why do we have different moral standards for the way our corporations treat us vs. how they treat people from any other country? An unfair system not only hurts the victims, but it also has a negative effect on the corporations. It infects our nation with a disregard for others as long as we make a buck. In the end that makes us weaker rather than stronger.

You don't get to make the laws for other nations.

By the way children are allowed to work in the US.

Since when did work become a bad thing?

reggie smith wrote:

You don't get to make the laws for other nations.

By the way children are allowed to work in the US.

Since when did work become a bad thing?

We can make laws that our own companies have to follow - or we can only buy products from companies that treat their employees well.

Sure they can work - I had a paper route for most of my childhood - but I wasn't working 80 hours a week in sweat shop at the age of 9 for pennies a day. That's the difference. There's nothing wrong with work - it's just that people should be fairly compensated and vunerable individuals (children) should not be taken advantage of.

reggie smith wrote:

The children working for nike should be thankfull. The alternitive is selling your self for sex or starvation. Thank god for nike and all the other big companies that allow people to actually have a job and bring home a paycheck. The high minded liberal elites never think of the alternitive. Only what THEY deem to be fair and just.

So, wanting people in poor disadvantaged countries to be treated right is an "elitist" position? That damn elitist Jesus - I wish he would have just shut his mouth about what he deemed to be "fair and just".

And I'm really sick of the conservative use of the "it could be worse" logic. It's what John Yoo uses when justifying torture - "well in a war we could kill them - so torture is actually not as bad." Or in this case - "they will either starve or sell themselves for sex - so paying them substandard wages is not really that bad." Please don't tell me that Nike gives a crap what happens to these people - they are using them because they are the cheapest labor pool they can find, period. And while some of you might say, "what's wrong with that - a company is supposed to make a profit" - I think we have to make a decision about the kind of culture we want to live in. Do we want to be living the good life off the backs of people in close to slavery like conditions?

Ninetonite wrote:

"the companies would find other ways to cut costs (materials, availability) to keep prices close, if not level."

Stupid comment. Don't you think that Nike, the biggest running shoe company in the world, has not already negotiated the very best price on raw materials? The company making the nylon and leather ain't gonna give it away for free??

If this is a stupid comment then how do the Air Max 360s retail for $160 when the Pegasus is only $80? Cheaper materials! Nike makes cheaper shoes than these, they would become the flagship running shoes as much as that will suck, but they will because the demand for ultra cushioned techno trainers won't outweigh the cost. Don't be ridiculous, we all know that companies like Nike, Walmart and McDonalds have a long way to go before they've cut costs all the way to the bottom. Anyone else here seen Soylent Green?

Its not an argument of what I want to happen to them.

Trust me, if the current system could go on forever OTG, I would be happy.

Unfortunately thats not the reality and you either adjust to reality, or let it deal with you harshly.

6 Billion people can not live like 200 Million do in this country. There aren't enough resources in the world to allow that for very long.

There are barely enough resources the way things are now to last as they are much longer. In one decade things will be starkly different.

So, again, while I'd be happy to the ends of my toesies OTG for all those little ethnics to be happy and have jobsies so their little ones could fatten, I understand that it won't happen. Its not because I don't want it to happen, but its called reality OTG. People starve. People die. Life isn't a hollywood movie OTG.

What the heck do you think will happen if oil, coal, and natural gas suddenly became 5% more scarce?

Resource Grab, leading to resource war, resulting in an even larger resource shortage, resulting in massive death cycles and further resource grabs, wars, and shortages that perpetuate themselves ad-infinitum.

OTG stick that que tip a little further in your ear next time and save me the trouble of explaining myself here. thanks.

When you get conscripted OTG, maybe you can give these little ones flowers. I'm sure they won't shoot you first...oh yeah life suddenly isn't so simple is it? Idiot.

Easy on that 9-year-old in Thailand. You might be talking about Mayeroff's significant other.

I'm curious, I always see these "slave labor" accusations around here and I was wondering: What would these people be doing if they weren't making shoes?

Are they being physically restrained from taking higher paying jobs at another place in their area?

Slave labor sounds so much worse and it let's the pie in the sky liberal refer to Big companies as plantation owners who use slaves for labor. When infact it is these companies who allow people to put food on the table.

These people are actually just mad because in reality they are doing nothing to help feed the hungry and the big companies are doing something to help the poor. They are giving them jobs.

This infuriates the high minded liberals

To the guy who said credit cards were stupid:

Quantity of money theory: P * Q = M * V

An availability of credit cards means that the amount of money people hold, k, decreses so V (V = 1/k) increses. With an increse in V, money is changing hands more often. V is dependent on the interest rate r so it becomes V(r). It is also inversely related to the interest rate, so we see falling interest rates as more credit cards come into play. A lower level of the real interest rate r will cause a fall in the nominal interest rate i (which equals r + inflation). When the nominal interest rate falls, investment will increase. With this, we will se an increase in Q (or Y, total income in the economy, total output in the economy, GDP) because Y = C(Y-T) + I(r) + G + (X-M).

Basically, you're completely f***ing wrong and credit cards in fact increase the level of employment and income across the board.

It increase employment due to Okum's Law, which states that a 2% rise in GDP will cause a 1% decrease in the Unemployment rate U/L, or put another way 1/(1+ (f/s))

Just stop posting you stupid liberal.