An Audacious Electronics Contractor in China

I was shocked to hear that an electronics contractor that makes Apple’s iPod in China has sued a Chinese financial daily for telling the truth about its alleged abuse of workers.

FoxConn, a Taiwanese outsourcing contractor that makes parts and equipment for major electronic brands, including Apple, apparently got caught with its pants down when it’s laborers were forced to work excessive overtime hours. Instead of taking corrective action, as it is obligated to do under Apple’s code of conduct, the company when to court in the city of Shenzhen in southern China and sued the China Business News for defamation, demanding $3.8 million in damages, according to Reuters.

FoxConn, a subsidiary of Hon Hai Precision Industry, is shooting itself in the foot by taking this action. As US public awareness rises about rampant labor abuse in electronic factories in China, smart contractors should be cleaning up their act to become more attractive suppliers. Their customers, giant multinationals like Apple, HP and Dell, are slowly getting serious about corporate social responsibility – and protecting their reputations as nice guys who run a clean and humane operation.

This is a human rights issue. The uncountable droves of young Chinese peasant women who pour into the Pearl River Delta are happy to get coveted jobs in the prestigious electronics industry. They don’t know any better when factory owners force them to work marathon shifts, far longer than the national labor law allows. I’ve interviewed girls who say they work up to 18 hours at a stretch on the assembly line when their factories get behind on production schedules.

It’s abusive and illegal, and any American company who doesn’t make its best efforts at rooting out this abuse in their supply chain should be taken to task. Apple reportedly took well-meaning steps to address the problem at FoxConn earlier this month, which makes it even more of an outrage that the Taiwanese contractor is trying to kill the messenger in court.

Labor abuses are widely known and reviled in textile and sports shoe sweatshops around the globe, but it’s only recently that a few courageous non-profit advocacy groups in Hong Kong and in southern China have shined a light at the situation in electronics factories. It’s long been a taboo subject to probe because of the Teflon coated reputations and economic influence of brand makers, who don’t really make much of anything themselves anymore. But the dirty little secret is that they’ve all been outsourcing their manufacturing to the lowest bidders among these contractors – some of which are based in Silicon Valley.

The human rights violation has been invisible behind the walls of the “clean rooms” in these impressively shiny, spotless factories. The girls often live two-to-bunk inside the plant compound, taking turns working 12-hour shifts while their bunkmates sleep, six and seven days a week. Once they’ve been around long enough to realize something’s terribly wrong, they find they can’t do much about it. Complaining risks the cancellation of their labor contract and sends them back to their impoverish villages. Getting together to form a committee or God forbid a labor union is impossible. Only China’s official labor union has the right to organize factory workers, and it’s an organ of the ruling Communist Party, which promotes capitalism but quashes the right to assembly to keep an iron grip on political power.

I don’t know all the details of the FoxConn case, but I know the context. I’ve talked to factory managers who make contorted arguments that the excessive overtime shifts are perfectly legal because local labor offices have given them official dispensation to waive the protections mandated in the national labor law. Their clients, the big brand makers, can in turn say that their overseas labor practices are in line with local law. Only their corporate codes of contact, which are not standardized and next to impossible to enforce, set boundaries for labor practices.
Apple should now do what’s known in business jargon as “best practices.” It should take transparent steps to resolve the problem at FoxConn. Its code of conduct compliance team should disclose the details of the case and submit a report to an organization like Business for Social Responsibility, which can used the case study to educate other companies on the right thing to do. That will help level the playing field and equitably spread the costs of safeguarding human rights in China across the electronics industry. And maybe it can make a dent in the systemic corruption that fosters abuses by the people who make the computers and other electronic tools we buy.

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It’s the Quality of Life, Stupid

You don’t have to be a Trotskyite or even a Socialist to notice that after the fall of the Soviet Union and the end of the Cold War, something very strange has been going on in the U.S. economy. It’s morphing into what looks a lot more like a laissez faire than a fair shakes economy, replete with permissiveness for no-holds-barred business behavior. It’s been uprooted from the Keynesian "mixed" economy philosophy that guided decades if unprecedented prosperity after World War II, with its dastardly “liberal” regulatory checks on business excess and its populist government intervention in the free market. But we've since privatized the free market of common good in the name of efficiency.

That’s a gross over simplification of a very complex reality, of course. Shameless hyperbole. But it has some basic truth to it, and it came to mind this morning when I read the front page New York Times article about the “slight increase” last year in median household income. I imagine more than a few neoclassical economists view this as a vindication of the regressive tax cuts and other questionable economic policies that have defined our existence over the past six years. (Photo above depicts a young John Maynard Keynes, 1883-1946)

But if you read past the headline and the perfectly factual first paragraph, you get to the real story about the Census Bureau’s new data. It’s totally misleading because the modest rise in household income is due to the fact that more family members in each household are entering the workforce to make ends meet. Personal income hasn’t risen at all.

Instead of supporting the myth of prosperity in a growing economy, the statistics reveal how miserable the lives of so many Americans have become in a new landscape of double working parents, lousy public schools, vanishing pensions, and crippling health care costs that are passed on directly to the backs of the lucky people who still have insurance.

Even a growing salary isn’t growing when the employee’s health insurance premiums jump and benefits decline, boosting out of pocket costs. I learned this the hard way earlier this year, when United Health Care sent a letter saying customers like me were going to enjoy “greater value” in their benefits following the company’s recent merger with Pacific Health Systems. Then I learned that our beloved pediatrician and several other doctors treating my ailments were no longer on contract. They’d refused to be paid at the significantly lower rates for their services that the combined healthcare giant offered after the merger. Tough luck.

Nobody should complain that higher gasoline prices are hurting the American quality of life, because the skyrocketing cost of fossil fuel is finally forcing thick-skulled policy makers to move in the direction of seriously thinking about alternative energy and rational mass transportation systems. Hopefully, that will result in progress, after 30 years of denying the lessons of the first two oil crises.

But the news from the Census Bureau goes to the heart of the problem festering away in our economy. There’s a deception behind the data about household income is “rising,” just as there is a deception in the claim that the U.S. economic recovery is based on greater industrial “productivity.” The middle class job force has been left out of this phony productivity-driven prosperity. Strident complaints about the damage perpetrated on white-collar workers by global outsourcing (or sending welll paying jobs overseas) may exaggerate the effects of unavoidable economic displacement, but they cannot be dismissed out of hand. Whether you love globalization or not, the American Everyman is feeling the pinch, and it’s starting to hurt badly.

There was more upbeat news from the Census Bureau: The growth in the number of people living in poverty leveled off in 2005. Only one in eight Americans now lives in poverty, defined as having an annual income under roughly $10,000 for an individual or $20,000 for a family of four. As if that’s something to be proud about for the world’s sole surviving superpower. Where did those trickle-down benefits from the Bush Administration’s supply-side economy policies go? To the astonishing rise of CEO compensation, or to the Wal-mart masses? (Poverty map above is from 2000, but the ugly picture hasn't changed much since then)

Another dry Census statistic to consider: 46.6 million Americans had no health insurance last year, or nearly 16 percent of the population. It was a small increase in terms of percentage points from 2004, but a devastating blow to the lives of those involved. The rate of uninsured grew for the fifth consecutive year, despite the opportunities for improvement one might expect from the so-called economic turnaround. I don’t know how to close this dispatch without sounding like some sort of rabid anti-American, pro-Terrorism hooligan to the electronic ears of the with-us or against-us Establishment. But it seems increasingly clear where the American quality of life is going behind the deceptively rosy economic statistics. Diminished expectations, lower income, more debt, more latchkey kids home alone because of the dearth of affordable childcare, greater rates of death and morbidity among the healthcare have-nots, so many more working hours at stagnant wages to sustain the miracle of productivity growth, and after scurrying around trying to retain the semblance of our former prosperity, no time to think about all this.

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The Disturbing Message behind North Korea’s Darkly Humorous Vitriol – and the Distraction of Pussy-footing around with Iran

One of the few pleasures I had when it was my rotation to work the overnight desk for the Associated Press in Tokyo in the early 1980s was monitoring North Korea’s English language news wire. It was like tuning into comedy central.

Besides singing adoration for “Great Leader” Kim Il Sung and crowing that its Juche ideology of demented autarky was guiding the nation to prosperity, Pyongyang attacked the United States daily with the shrillest over-the-top rhetoric imaginable. It was more than mere propaganda. It was hilarious. Instead of offering tea leaves to read, the Korean Central News Agency entertained with ironic phraseology that paid homage to both George Orwell and Eugene Ionesco.

Later in my career I sent countless telexes and letters to North Korean officials asking permission to visit the country and hoping to meet some of the creative authors behind the absurd verbiage. Were they GIs who defected during the Korean War, enslaved as translators and sending illicit messages of regret and ridicule and dark humor? My timing was always out of synch with the erratic cycle of chance when the reclusive regime opened up to foreign journalists. But I never stopped being a fan of Pyongyang’s perverted political poetry.

The frightening thing is that North Korea is no longer a paper tiger. It has the bomb. Several of them. You don’t have to look very far to find a security analyst who will tell you that the regime of “Peerless Leader” Kim Jong Il, the late great leader’s son, could be paranoid enough set off a little mushroom cloud in a wild moment of panic, as suicidal as that may seem. North Korea’s strategic deterrent to rational diplomacy is far more mad than the relatively benign mutual assured destruction (MAD) doctrine of the Cold War.

Let’s hear what the KCNA wire is saying today:

In the top dispatch, it characterizes the Bush Administration’s threat of escalating economic sanction (an effort to get a recalcitrant Pyongyang back into six-party talks) as a “gangster-like act of gravely infringing upon the sovereignty and dignity of its dialogue partner.” Thin skinned as ever, but you have to wonder if the White House is still relying too heavily on the stick and letting the carrots rot.

The wire service ran an article from the official state newspaper, Rodong Sinmun, blasting the US imperialists for creating “clouds of war” on the Korean Peninsula with annual joint military exercises in South Korea, and planning a “preemptive attack” on the North “worked out by the Bush bellicose forces.” This may sound a little weird, but it's nothing new. In response to the 1983 "Team Spirit" exercizes, KCNA bellowed that a ''a semiwar state'' had been declared and that ''all the units of the Korean People's Army will get ready in full combat gear to smash in time the enemy's war moves. ''

Today's utterances are hardly the soothing words of diplomacy. They can be explained partly as aimed at mobilizing the local citizenry – who are still suffering from food shortages in a botched totalitarian society and are sneaking across the Chinese border in droves. They don't believe the propaganda and many are yearning for political assylum in the South, like the gang of 136 refugees trapped yesterday in a legal bind in Bangkok on their odyssey to Seoul. But there’s also method of childish distemper to this madness, crafted for external consumption. It is the rant of a dangerously frustrated, boxed in and decaying military state that considers itself the only legitimate government on the Korean Peninsula, and a martyr to the cause of rectifying its own glorious role in history.

Still, North Korea’s hysteria doesn’t excuse the fact that foaming-at-the-mouth neo cons in the Administration conned George Bush soon after his first inauguration into thinking that brinksmanship was the only way to contain the “nucular” threat from North Korea. Bill Clinton and his pals were wimps for thinking otherwise and trying to negotiate and cajole North Korea out of its missile tests, black market weapons sales, and plutonium dreams.

I’m left with the feeling that the people who act on behalf of the US government have met their match in their battle with North Korea’s propaganda machine. They are just as frustrated as their foe, crippled by their own rigid ideology, and incapable of defusing the time bomb ticking away in one of the world’s most dangerous hot spots. Dealing with the threat of nuclear proliferation in Iran is a cake walk in comparison, although chances are they’re going to blow that one too. Why are they making this avoidable mistake, and why did they preoccupy themselves with Iraq’s imaginary weapons of mass destruction in the first place, when the smoking gun is branished by the other member of the "axis of evil" in East Asia?

Yasukuni Shrine

If I had this blog thing up and runing on August 15, the anniversary of Japan's surrender in World War II, I would have chimed in to complain about the shallow reporting on the Prime Minister's controversial visit to Yasukuni Shrine.

The nub of my comment would have been to say the visit, paying homage to the spirits some war criminals in addition to those of fallen Imperial soldiers dating back to the year Meiji 2 (1869), was primarily about domestic politics, not international. Koizumi may be stepping down as premier, but he's young enough to want to manipulate politics from behind the scenes for years to come, in the Tanaka tradition of wire-puller. He's continuing to pander to the right wing of his party, despite the howls of protest from Beijing and Seoul, because he can't stop doing so without looking like a real lame duck. This is textbook LDP politics, shedding some light on the core of unhealthy nationalism that gives Japan's new nationalistic awakening a bad name. (Cartoon above, from the Yasukuni Shrine Web site, illustrates Japanese children learning about praying for war ghosts)

There, I've said it. Ten days too late. With the full understanding that nobody's listening. Just clearing my throat. Ahem.

Signing On

Greetings, bloglings. I'm new to this form of communicating, so cut me some slack if I'm amateurish in my initial attempts.

I stopped traveling regularly around Asia a couple of years ago and am still trying to get my feet and my brain on the ground.

Image at right is me posing by the famous red mailbox I made when I was a student at Kyoto University in the late 1970s. Amazingly, in April it was still hanging next to the rice shop in Asukaicho I lived above. I try to check it every few years. Haven't seen any mail for me, but its nice to ponder my immnortality as a former "Kyo Gaijin," as lost foreingers were known in Kyoto at the time. Yes, you CAN go back.