by David L. Wil­son, MR Zine (A project of the Monthly Review)

mrzine.monthlyreview.org/2010/wilson040310.html

Within days of a Jan­u­ary 12 earth­quake that dev­as­tated much of south­ern Haiti, the New York Times was using the dis­as­ter to pro­mote a United Nations plan for dras­ti­cally expand­ing the country’s gar­ment assem­bly indus­try, which employs low-paid work­ers to stitch apparel for duty-free export, mainly to the U.S. mar­ket.  This, accord­ing to sev­eral opin­ion pieces in the Times, is the way to rebuild Haiti.¹

The out­lines of the plan were drawn up a year ear­lier, in Jan­u­ary 2009, by Oxford econ­o­mist Paul Col­lier,² but the lead­ing pro­po­nents of devel­op­ment through sweat­shops have been lib­eral Democ­rats in the United States.  Mem­bers of the Con­gres­sional Black Cau­cus pushed hard for HOPE and HOPE II, the 2006 Hait­ian Hemi­spheric Oppor­tu­nity through Part­ner­ship Encour­age­ment Act and its 2008 exten­sion; these acts make the plan pos­si­ble by giv­ing pref­er­en­tial treat­ment to U.S. imports of apparel assem­bled in Haiti.³ UN Spe­cial Envoy for Haiti Bill Clin­ton, the for­mer U.S. pres­i­dent, has pro­vided much of the PR for the plan; in the fall of 2009 he orga­nized a spe­cial meet­ing to encour­age for­eign busi­ness invest­ment in Haiti.⁴ Lib­eral U.S. financier and phil­an­thropist George Soros is help­ing build a new $45 mil­lion indus­trial park near Port-au-Prince’s impov­er­ished Cité Soleil neigh­bor­hood as part of the plan’s imple­men­ta­tion.⁵

Adding to the project’s lib­eral cre­den­tials, in August 2009 Bill Clin­ton made Dr. Paul Farmer his deputy UN spe­cial envoy.  Har­vard pro­fes­sor Farmer is widely respected for his med­ical work in Haiti; he is a founder of Part­ners in Health/Zanmi Las­ante and is on the board of direc­tors of the Insti­tute for Jus­tice and Democ­racy in Haiti (IJDH), a US-based left-liberal advo­cacy group.⁶

The Fall of the Maquilado­ras

The plan’s lib­eral sup­port­ers some­times admit that assem­bly plant jobs may not be the very best type of employ­ment.  But Haitians need work, they say, and the new sweat­shops will cre­ate jobs — as many as “sev­eral hun­dred thou­sand,” accord­ing to Prof. Collier’s descrip­tion of the plan.  What the lib­er­als don’t explain is where they think the jobs will come from.

The gar­ment export indus­try in the Caribbean Basin has been in a sharp decline for the past five years.  The cur­rent round of jobs losses in the region’s apparel maquilado­ras — the Span­ish name for the assem­bly plants — started with the growth of com­pe­ti­tion from indus­trial pow­ers like China and has inten­si­fied with the eco­nomic cri­sis in the United States, the main mar­ket for the industry’s products.

The Domini­can Repub­lic, Haiti’s clos­est neigh­bor, lost 73,000 gar­ment jobs from 2005 through 2007, accord­ing to an infor­ma­tive arti­cle by Mar­ion Weber and Jen­nifer Blair in the July/August 2009 NACLA Report on the Amer­i­cas.  The six coun­tries that signed on to the 2005 Domini­can Republic-Central Amer­ica Free Trade Agree­ment (DR-CAFTA) — in addi­tion to the Domini­can Repub­lic, the U.S.-sponsored trade zone includes Costa Rica, El Sal­vador, Guatemala, Hon­duras, and Nicaragua — saw their com­bined exports fall from a 13.3% share of the U.S. import mar­ket in 2004 to 9.8% in 2008.⁷

The job sit­u­a­tion con­tin­ues to dete­ri­o­rate.  Gar­ment jobs in the Domini­can “free trade zones” (FTZs) — the spe­cial areas where the maquilas are clus­tered — fell another 15.05% in 2008, from 58,546 to 49,735.⁸ In Hon­duras, site of Latin America’s most recent coup d’état, tex­tile and apparel pro­duc­tion for the first six months of 2009 was down by 17.9% com­pared to the same period the year before.  The Hon­duran maquiladora sec­tor lost 15,000 jobs in 2008 and about 8,000 in the first eight months of 2009, leav­ing it with some 114,000 employees.

By Sep­tem­ber 2009 Guillermo Mata­moros, a leader in the Hon­duran assem­bly indus­try, was giv­ing up on apparel and push­ing a new type of maquiladora: call cen­ters and soft­ware cen­ters in the north of the coun­try, which he said could gen­er­ate 25,000 to 40,000 new jobs because of the large num­ber of Hon­durans who are bilin­gual in Eng­lish and Span­ish.⁹

Mag­i­cal Think­ing on Jobs

Of course, the U.S. mar­ket for imported apparel is expected to grow back if the eco­nomic cri­sis recedes, but it’s hard to see how that by itself would pro­duce sev­eral hun­dred thou­sand new jobs for Haiti.

Peo­ple in the United States tend to think irra­tionally about things like job cre­ation.  Many of us believe that immi­gra­tion reduces the num­ber of jobs avail­able for U.S. cit­i­zens, while the same peo­ple often swal­low the idea that build­ing new indus­trial parks in Port-au-Prince will mag­i­cally cre­ate jobs for Haitians.

The real­ity is exactly the oppo­site.  If Hait­ian immi­grants were stitch­ing gar­ments in New York or Los Ange­les at jobs with stan­dard wage rates, they and their depen­dents would be able to pay for decent hous­ing and sta­ples like food and cloth­ing.  This would stim­u­late job cre­ation, and the new jobs would make up for the jobs the immi­grants had taken — as in fact hap­pened in the past when the United States pro­duced its own apparel in union shops.  But if the same Haitians work in assem­bly plants in Port-au-Prince or in the FTZ near the Domini­can bor­der in Oua­naminthe, they have to accept wages at about one-twentieth the rate they would get in the United States.  These work­ers are barely able to scrape by; their spend­ing can do lit­tle to stim­u­late job cre­ation either in Haiti or in the region as a whole.

But the UN plan isn’t really about cre­at­ing jobs; it’s about relo­cat­ing them.  The key, accord­ing to Prof. Col­lier, lies in Haiti’s “pro­pi­tious fun­da­men­tals” — its “poverty and rel­a­tively unreg­u­lated labor mar­ket” and “labor costs that are fully com­pet­i­tive with China.”  Add Haiti’s loca­tion near the United States: it’s “on the doorstep of its mar­ket.”  Haiti is the “only low-wage econ­omy in the region,” Col­lier writes, mean­ing that the maquilas in nearby coun­tries just can’t com­pete with Hait­ian fac­to­ries pay­ing a min­i­mum wage of around $3.05 a day, approx­i­mately half the min­i­mum in the Domini­can FTZs.¹⁰

So when the pro­fes­sors and politi­cians say they will help Hait­ian work­ers by giv­ing them jobs, what they really mean is that they plan to take the jobs away from Domini­can, Mex­i­can, and Cen­tral Amer­i­can work­ers — and pay the Haitians even less for doing the same work.  It’s no won­der that the Amer­i­can Apparel and Footwear Asso­ci­a­tion (AAFA), a U.S. man­u­fac­tures’ orga­ni­za­tion, hopes to “play a respon­si­ble and proac­tive role in Haiti’s over­all recov­ery.“¹¹

Rerun­ning the Race to the Bottom

The jobs the Haitians will get are only tem­po­rary, in any case.  Hait­ian work­ers have been through all this before.

Haiti pio­neered export-based devel­op­ment plans in the 1970s under Jean-Claude Duva­lier (“Baby Doc”).  Once assem­bly plants started oper­at­ing in Haiti, other parts of the region fol­lowed suit under the Rea­gan administration’s 1984 Caribbean Basin Ini­tia­tive (CBI).  The brief boom in the Caribbean apparel indus­try ended when jobs started going to Mex­ico because of the 1994 North Amer­i­can Free Trade Agree­ment (NAFTA).  Mex­i­can work­ers became still more “com­pet­i­tive” after 1994, thanks to an eco­nomic cri­sis and a cur­rency deval­u­a­tion (a de facto wage cut).  The Mex­i­cans in turn lost jobs to lower-paid Chi­nese work­ers as the new mil­len­nium started.  Domini­can and Cen­tral Amer­i­can man­u­fac­tur­ers responded with DR-CAFTA and, pre­dictably, more wage cuts.  And yet the job losses have con­tin­ued.¹²

Anti-sweatshop activists Bar­bara Briggs and Char­lie Ker­naghan used to warn back in the 1990s that this type of “eco­nomic devel­op­ment” would cre­ate a “race to the bot­tom” in which work­ers in dif­fer­ent coun­tries would have to com­pete by accept­ing lower and lower wages.  And that’s exactly what happened.

Haitians have learned not to lis­ten to peo­ple like Prof. Col­lier and Spe­cial Envoy Clin­ton.  In August 2009 thou­sands of Hait­ian sweat­shop work­ers went on strike to demand a higher min­i­mum wage.  They ignored argu­ments that they needed to keep their wages com­pet­i­tive — it took tear gas and UN troops to get them back into the fac­to­ries.¹³ Grass­roots orga­ni­za­tions meet­ing in Port-au-Prince since the earth­quake have been work­ing on pro­pos­als for rebuild­ing Haiti through a sus­tain­able devel­op­ment plan rooted in Hait­ian real­ity.  “Not more of the same,” Camille Chalmers of the Hait­ian Plat­form to Advo­cate Alter­na­tive Devel­op­ment (PAPDA) said in late Jan­u­ary, “but some­thing really alter­na­tive and pop­u­lar.“¹⁴

Maybe it’s time to lis­ten to the Haitians for a change.

1 Nicholas D. Kristof, “Some Frank Talk about Haiti,” New York Times, Jan­u­ary 20, 2010; Paul Col­lier and Jean-Louis Warn­holz, “Build­ing Haiti’s Econ­omy, One Mango at a Time,” New York Times, Jan­u­ary 28, 2010;  “Think­ing About a New Haiti,” edi­to­r­ial, New York Times, Feb­ru­ary 1, 2010

2 Paul Col­lier,  “Haiti: From Nat­ural Cat­a­stro­phe to Eco­nomic Secu­rity,” report for the sec­re­tary gen­eral of the United Nations, Jan­u­ary 2009.  For more on the Col­lier plan, see Ash­ley Smith, “The ‘Shock Doc­trine’ for Haiti,” Social­ist Worker, Feb­ru­ary 8, 2010.  For Collier’s related views on peas­ant farm­ing, see Walden Bello and Mara Baviera, “Food Wars,” Monthly Review, vol. 61, no. 3, July-August 2009.

3 Rep. Kendrick Meek, “A Help­ing Hand for Haiti,” The Louisiana Weekly, June 20, 2008.

4 Marc Lacey, “Still Frag­ile, Haiti Makes Sales Pitch,” New York Times, Octo­ber 5, 2009.

5 “Haiti-based WIN Group and Soros Eco­nomic Devel­op­ment Fund Announce a $45 Mil­lion Com­mer­cial Zone in Haiti,” Busi­ness Wire, Octo­ber 6, 2009, via Reuters.

6 “Pres­i­dent Clin­ton Appoints Paul Farmer as Deputy Spe­cial Envoy for Haiti,” Office of the Spe­cial Envoy for Haiti press release, August 11, 2009; Part­ners in Health/Zanmi Las­ante web­site, <http://www.pih.org/where/Haiti/Haiti.html>, and IJDH web­site, <http://ijdh.org/about/board-of-directors>, both accessed Feb­ru­ary 26, 2010 .

7 Mar­ion Werner and Jen­nifer Bair, “After Sweat­shops? Apparel Pol­i­tics in the Circum-Caribbean,” NACLA Report on the Amer­i­cas, Vol. 42, No. 4, July/August 2009.

8 “Informe Estadís­tico 2008,” Con­sejo Nacional de Zonas Fran­cas de Exportación, Cuadro No. 28.

9 “Hon­duras: Econ­omy Could ‘Quickly Buckle,’” Weekly News Update on the Amer­i­cas, #1002, August 30, 2009; “Hon­duras: Will Maquilas Sur­vive the Coup?” Weekly News Update on the Amer­i­cas, #1005, Sep­tem­ber 27, 2009.

10 The min­i­mum wage for Hait­ian assem­bly plant work­ers was raised to 125 gour­des a day in Sep­tem­ber 2009 (USD $3.049 as of Feb­ru­ary 24, 2010).  The monthly min­i­mum wage for FTZ work­ers in the Domini­can Repub­lic is cur­rently 5,400 pesos a month (USD $145.397 as of Feb­ru­ary 24, 2010); see “El Comité Nacional de Salarios aumenta el salario de la zona franca,” Notirevista.com, Decem­ber 18, 2009.

11 James A. Mor­ris­sey, “Tex­tiles and Apparel Will Play Key Role in Haiti Recov­ery,” Tex­tile World, Feb­ru­ary 9, 2010.

12 Mar­ion Werner and Jen­nifer Bair, op. cit.

13 “Haiti: Maquila Work­ers March for Wage Hike,“Weekly News Update on the Amer­i­cas, #1000, August 9, 2009; “Haiti: More Strikes Hit Maquilas,“Weekly News Update on the Amer­i­cas, #1001, August 23, 2009.

14 Bev­erly Bell, “Rais­ing Up Another Haiti,” Com­mon Dreams, Febu­rary 23, 2010; “Camille Chalmers: ‘We Call for Sol­i­dar­ity Between the Peo­ple,’” Anarkismo.net, Febu­rary 3, 2010.  See also PAPDA web­site, <http://www.papda.org/>.

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David L. Wil­son is co-author, with Jane Guskin, of “The Pol­i­tics of Immi­gra­tion: Ques­tions and Answers” (Monthly Review Press, July 2007) and co-editor of “Weekly News Update on the Amer­i­cas.”  He was in Port-au-Prince to inter­view Hait­ian activists about the UN devel­op­ment plan when the earth­quake struck on Jan­u­ary 12.