Insatiable demand for iPhones has helped Apple achieve first quarter profits of $13B, more than double that for the same period in the previous year. It’s been a bonanza for Apple shareholders. Not so much for the Chinese workers assembling the iPhones.
In a piece written for the New York Times, Charles Duhigg and David Barboza describe an accident at a factory where employees polished thousands of iPad cases a day. “Two people were killed immediately, and over a dozen others hurt. As the injured were rushed into ambulances, one in particular stood out. His features had been smeared by the blast, scrubbed by heat and violence until a mat of red and black had replaced his mouth and nose.”
Chinese employees “work excessive overtime, in some cases seven days a week, and live in crowded dorms. Some say they stand so long that their legs swell until they can hardly walk. Under-age workers have helped build Apple’s products, and the company’s suppliers have improperly disposed of hazardous waste and falsified records, according to company reports and advocacy groups that, within China, are often considered reliable, independent monitors.”
Companies like Apple love the flexibility Chinese manufacturing affords them, enabling them to reduce product cycles and change direction quickly — crucially important in the fast-paced world of consumer electronics. But this kind of flexibility comes at a price.
“Apple never cared about anything other than increasing product quality and decreasing production cost, said Li Mingqi, who until April worked in management at Foxconn Technology, one of Apple’s most important manufacturing partners. Mr. Li, who is suing Foxconn over his dismissal, helped manage the Chengdu factory where the explosion occurred.”
The arguments for globalization, more or less, are that capital respects no barriers, and that these workers — such as their lot is — are still better off than they would otherwise be. We should all realize that globalization is here to stay get used to the new reality.
Here at home in London Ontario, Caterpillar, a global company with almost $60B of annual revenue has “offered” to cut Electro Motive workers wages in half and reduce benefits and pensions. Caterpillar isn’t citing competition or threatening to move their plant because they don’t have to. They are simply following a business strategy designed to increase profitability and it works. Caterpillar stock rises when they stage a planned lockout.
Under the present tenets of capitalism, no amount is too much, and no violations of human or environmental capital are too egregious. Do corporations have ethical and moral responsibilities? It’s time to have this conversation. Not to do so means you’re tacitly accepting your role in the race to the bottom.