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China, Trade and Progress; Working Conditions in China Today Don't Look Too Different from Those in the United States a Century Ago, When We Were First Industrializing

By Samuelson, Robert J. | Newsweek, April 5, 2004 | Go to article overview

China, Trade and Progress; Working Conditions in China Today Don't Look Too Different from Those in the United States a Century Ago, When We Were First Industrializing


Samuelson, Robert J., Newsweek


Byline: Robert J. Samuelson

The test of a first-class mind is the ability to hold two opposing views... at the same time and still retain the ability to function," F. Scott Fitzgerald once said. So it is with China and trade. On the one hand, expanded trade has lifted millions of Chinese out of poverty. But on the other, it has fostered oppressive working conditions. Which brings us to the AFL-CIO's sweeping trade complaint against China submitted recently to the Bush administration. It's an object lesson in the new politics of trade.

The AFL-CIO says that repressive labor practices have depressed China's factory wages by 47 percent to 86 percent, lowered the prices of Chinese exports and cumulatively cost about 727,000 U.S. jobs. What repressive labor practices? Well, Chinese workers can't organize independent unions. Wages sometimes aren't paid. Millions of migrant workers--often young women--are held in virtual bondage. They move from rural areas and, because they need residency permits that can be revoked, are at the mercy of employers. Sweatshops are common. Writes sociologist Anita Chan of the Australian National University, whose research partially informs the AFL-CIO complaint:

"According to a survey I conducted in China's footwear industry, the average number of hours came to about 11 each day, often with no days off--that is, an 80-hour work week. [There] is a staggering amount of wages owed but not paid to migrant workers: 43 percent of the 51,000 cases of workers' complaints [in Shenzhen, an industrial city] in 2001 related to unpaid wages."

Grim. But it's also true that China's economic liberalization has been a vast engine of human progress that, in turn, has depended heavily on trade. In the past 25 years, reports economist Andy Xie of Morgan Stanley, China's economy has expanded by a factor of almost nine, but exports have grown 45 times. Here are some measures of social gains from the World Bank:

From 1978 to 2002, the average annual per-person income rose from $190 to $960. It's probably now above $1,000. (The U.S. figure: about $36,000.)

Life expectancy increased from 61.7 years in 1970 to 71 in 2002.

Adult illiteracy fell from 37 percent in 1978 to less than 17 percent in 1999.

Infant mortality dropped from 41 per 1,000 live births in 1978 to 30 in 1999 (the U.S. rate: about seven).

The explanation for the apparent paradox is that progress is a contradictory beast. In most societies, industrialization confers huge benefits even though it is a rough process. In late-19th-century America, factory work was typically 10 hours a day, six days a week, and layoffs were usually at the whim of foremen, reports a paper by economists Jeremy Atack of Vanderbilt University and Fred Bateman of the University of Georgia.

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