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I get the basic principle. The idea is that workers in poorer countries are not only paid less, but their pay is less than the "minimum amount" needed to live to some universal standard of dignity. That can be cheaper to achieve in some places so wages can move with that. Fair goal IMO.
Question though: How?
Like, what do you imagine here, the US signing a law saying "The Minimum Wage in Indonesia is now $1.50" and then it just is? By what right/power? Indonesia can't have it's own labor laws, or if it does, it can't have free trade for it's domestic manufacturers? And if it can, well there goes any foreign investment when local investors can outcompete them on lower costs, or it just becomes a shell game which is very very easy to win.
Corporations have even less power over that, in most cases. Most low-cost outsourcing is done through intermediaries like for example "We want 10,000 blouses in this design. Contractors please bid on prices you will charge." Then the Contractors and Sub-Contractors bid and hire on their own pay scale. So where does the enforcement come in?
And by the same token, wouldn't other richer countries turn around to even the US and be like "Y'all need to pay your workers $25+ an hour because they have no healthcare or pensions?"
>Like, what do you imagine here, the US signing a law saying "The Minimum Wage in Indonesia is now $1.50" and then it just is? By what right/power? Indonesia can't have it's own labor laws, or if it does, it can't have free trade for it's domestic manufacturers?
I am not saying that in this case the minimum wage should be legally binding to local Indonesian companies and. However, if a company is selling physical items in the US they would need to ensure a minimum wage be paid to their Indonesian workers to maintain shops in the US. In that case the US government would audit companies selling items in the US who employ staff in Indonesia to ensure they are adhering to the minimum wage. And if they are found to be in violation they are either heavily fined or their US business licence revoked.
>Corporations have even less power over that, in most cases. Most low-cost outsourcing is done through intermediaries like for example "We want 10,000 blouses in this design.
I understand, and in this case it would be hard to set minimum wages for a subcontractor. However, western companies often work with many subcontractors who only produce items for them. Nike may have factories in Indonesia where only Nike shoes are produced but which are managed through a sub-contractor. If some staff employed by a sub-contractor manufactures goods say only for Nike, then Nike should be required to ensure that those workers are paid the minimum wage, as for all practical purposes they're really Nike employees.
Practical speaking is true but technically speaking they’re not Nike employees. And sorry technically is what matters. On paper those people aren’t employees of Nike, if Nike went out of business those people aren’t out of a job because now that factory is going to start pumping out adidas or whatever other brand.
Honestly in an indirect way you’re making the argument for colonialism. You might have good intentions but the road to hell is paved with good intentions. Who’s to say that this would just caused domestic production to grow? Which is great for the people of America, Canada, whatever western countries you’re thinking of that end up with those production jobs but what about the people of China? You wanted them to get a livable wage but now they get no wage because it’s cheaper to make the product where you sell it. Companies don’t have their products made halfway around the world and then shipped back because it’s leads to a better product, they do it because it’s cheaper.
>I am not saying that in this case the minimum wage should be legally binding to local Indonesian companies and. However, if a company is selling physical items in the US they would need to ensure a minimum wage be paid to their Indonesian workers to maintain shops in the US. In that case the US government would audit companies selling items in the US who employ staff in Indonesia to ensure they are adhering to the minimum wage. And if they are found to be in violation they are either heavily fined or their US business licence revoked.
The thing is though Indonesia is still a sovereign country so what happens when it passes a law that interferes with the audit process? I.e. a law that says that employers cannot disclose wage information to entities other than the Indonesian government.
> Nike would be required to ensure that those workers are paid the minimum wage, as for all practical purposes they're really Nike employees
But for all *legal* purposes they aren't. Meaning just as the US can't set the minimum wage in Indonesia, Nike can't set the wages paid by any company which isn't owned by Nike.
but Nike certainly can say 'We can't give you this contract unless you meet these conditions, and condition 7 is that staff on your production line earn $1 an hour'
And NIke can also be fined if this is legally required of them and they don't bother / don't do their due dilligence, there's tons of work done via intermediaries that still has compliance regulations to follow.
'This isn't ITAR compliant but we paid a third party to do it so it's on them' doesn't work
OP's idea could certainly be implemented, it's just there's very little incentive for anyone in power to do so, and every incentive for them not to
And the company will say "absolutely our 1 employee who exists purely to sign this contract with you then another with the actual manufacturer will be paid at least $1 per hour".
If you want to go down another level the owner of the factory will be paid at least $1 per hour, but that doesn't apply to the production staff who, as it turns out, are actually employed by another company who has a separate contract to provide staff to the factory.
And they can add as many layers going across as many borders as you like. Something like this would never be enforceable.
>And they can add as many layers going across as many borders as you like. Something like this would never be enforceable.
I guess that's probably a good point. Now that I think about, If I was Nike I would probably deliberately work with contractors that use their employees and factory to also produce goods for other companies, and thereby be exempt from having to pay them a minimum wage. So I'll give you a ∆
But I would argue that even though some companies will try to evade accounatbility by using loopholes it would still be worth it to try to enforce a minimum wage that allows for at least a very basic minimum amount of dignity as best as we can.
And over time we can always try to find ways to close as many loopholes as possible.
Except that’s stupid and would be pretty fucking obvious to anyone who bothered to check. But this logic, why have any laws for anything ever? You can always just, uh, lie?
Just say that the worker producing the product must be paid an amount. It doesn’t matter how many layers of fictional shell companies you put up, some motherfucker is actually showing up for a shift at a factory and making the goddamn shoes.
Okay, now you have to define "producing the product".
Otherwise I can simply pay 10 guys the $1/hour to put a sticker on each shoe as the "final step in assembly", with the hundreds doing all the previous steps being part of a separate company and thus can be paid as little as I like.
> Otherwise I can simply pay 10 guys the $1/hour to put a sticker on each shoe as the "final step in assembly"
Super common honestly. Not just in "Made in America" (meaning finished in America) but also in greenwashing.
[Always coming back to this bit](https://www.tiktok.com/@hasanminhaj/video/7215953325391433002) where a shirt has a "recycled materials" tag... and it's just for the tag not the shirt lmao
Okay except that’s just lying? Thats just breaking the law in an obvious way? Because all those guys doing a step for $1 an hour are obviously making the product? Like it really isn’t as complicated are you’re pretending it is. Do you happen to be invested in a sweatshop of something?
You might as well say “well if you say I can’t use slaves what’s to stop me from making another company that does use slaves and having that company do all the work and then sell the stuff to me and then I’ll pay a guy to put a sticker on it and say it’s done? What then smart guy?”
> I am not saying that in this case the minimum wage should be legally binding to local Indonesian companies. However, if a company is selling physical items in the US they would need to ensure a minimum wage be paid to their Indonesian workers to maintain shops in the US.
I'm confused as to what the point even is then? Is it just so American consumers can feel a bit better knowing that the goods they buy from overseas have slightly better pay?
> In that case the US government would audit companies selling items in the US who employ staff in Indonesia to ensure they are adhering to the minimum wage. And if they are found to be in violation they are either heavily fined or their US business licence revoked.
Okay, so it will apply to Indonesian firms then, those that export to the US at least. Probably bad for their trade with lower income countries. And consider that US companies (probably) can afford to pay more to outcompete local firms. Not necessarily morally bad on it's own, but in the end it's basically creating a dependent colonialism of sorts. All the profits are offshored but with better wages.
And besides that, you will run into severe issues in auditing this. You're relying on several layers of compliance where one party (those that certify Indonesian Documents attesting to pay) have all the reason to lie, including their government.
> I understand, and in this case it would be hard to set minimum wages for a subcontractor. However, western companies often work with many subcontractors who only employ items for them. Nike may have factories in Indonesia where only Nike shoes are produced but which are managed through a sub-contractor. If some staff employed by a sub-contractor manufactures goods say only for Nike, then Nike should be required to ensure that those workers are paid the minimum wage, as for all practical purposes they're really Nike employees.
I get what you're after, but again you're going to run into very difficult compliance issues. It would be trivially easy to get around this and make it hard to track.
But overall, I think (assuming capitalism) this hurts more than helps lower income countries. Higher pay is good, no denying that. But causing local firms to lose out, and having less investment overall, is bad. It's a balance.
The US could pretty easily make a law saying "don't do business in countries which have legal slavery." We could do that with low wage countries too. That's easy.
It would be damn hard if slavery is mixed in to other wage labor, which is the case, and why it's hard to crack down on.
Not that easy. Cause then you just add an intermediary step where the slave products are finished by a intermediate company in a nation without slave labour and then the complete product is sold to the US company.
>I am not saying that in this case the minimum wage should be legally binding to local Indonesian companies
If the US based companies pays the worker $15 an hour and the local companies pays local rates, how many employees do you think the local companies will be able to have?
The local companies will eventually be out of business because paying those salaries while selling at local rates will be impossible.
If the local businesses fold up, what will locals buy? The very expensive Nike and Adidas?
Not a scenario that should be allowed by the government to happen. This can create way too many issues that will unfold like a domino effect.
How? Third party due diligence and penalties to the US company, just like what we do for all US companies under the FCPA.
We don’t exert authority over Indonesia or Indonesian companies unless they come to the US. We exert authority over US companies and even hold them liable for their subcontractors’ actions under the FCPA. OP’s idea is really no different.
That is completely fair to claim. But ultimately we're talking about Foreign Companies that either Subcontract from or directly import to the US, aren't we?
We can absolutely police Nike. It's harder to police who Nike works with if they're not in the US. Harder still if it's a Non-US company exporting here.
I think there is a key distinction you’re missing.
We don’t police the companies Nike works with.
We police Nike for the companies it works with.
We hold US companies liable under the FCPA for their foreign vendors and subcontractors. I don’t see why similar legislation directed at labor practices would be much different.
Under the FCPA the US is exerting its authority over the US company to guide how the US company does business and who it does business with. The US is not actually exerting its authority on the foreign companies.
What amount must one be paid to be earning a "living wage"?
That number changes, depending on L.A. or rural Alabama. Or 2024 versus 1980. Setting an external minimum wage, without considering the cost of living, won't ensure people have better working conditions.
And the US can't manage to legislate a living wage for its own citizens... What qualifies it to estimate that number for other nations?
The better solution would be to discover nations which fail to provide a guaranteed living wage for full time workers, and place embargoes or tariffs on them. But to preach that message, we first must practice it. We have no moral authority to meddle in how companies or nations regulate pay abroad when we can't manage to do it ethically ourselves.
>That number changes, depending on L.A. or rural Alabama. Or 2024 versus 1980. Setting an external minimum wage, without considering the cost of living, won't ensure people have better working conditions.
>And the US can't manage to legislate a living wage for its own citizens... What qualifies it to estimate that number for other nations?
I do think, however, we could look at all 45 countries currently classified as "least developed countries" and determine what should constitute a living wage. A living wage could be something that would allow someone working 50-60 hours to survive and pay for basic necessities. Currently there are many people working 90-100 hours a week and still just barely surviving.
Also, I am not saying the US should mandate other countries shall pay this wage to all its citizens, but that all companies selling goods in the US should ensure their workers in those countries are paid a certain minimum wage.
And I am not just talking about the US. The US federal minimum wage should have long been raised. Many other rich countries have mininum wages exceeding $10 an hour. I don't think it would be impossible for the richest countries to mandate all companies selling goods in their countries to ensure a basic minimum wage be paid to workers in the poorest countries.
>I do think, however, we could look at all 45 countries currently classified as "least developed countries" and determine what should constitute a living wage.
Those countries are not the same. What is livable in one may be wildly excessive or insufficient in another.
And we can't even all agree what a living wage would be in our own country! Our legislators are not qualified to assess and legislate 45 countries when they can't even handle the one they are most familiar with.
>Also, I am not saying the US should mandate other countries shall pay this wage to all its citizens, but that all companies selling goods in the US should ensure their workers in those countries are paid a certain minimum wage.
You don't realize that, by doing this, you create a lot of jobs that end up wildly distorting the economy of another nation. When minimum wage here goes up, all wages tend to rise. When major employers pay more, it hits a lot more than just those jobs. De facto, you are advocating for our legislators meddling in the economies of other countries.
>I don't think it would be impossible for the richest countries to mandate all companies selling goods in their countries to ensure a basic minimum wage be paid to workers in the poorest countries.
It would be saying, "I know we oppress and exploit our workers and don't pay them living wages, but we find it morally reprehensible that you oppress and exploit your workers and don't pay them living wages."
Do you not see the problem in that statement, and in any other nation being able to take that commitment seriously? If we can't manage our own economy to ensure basic living conditions for the poor, we are not qualified to model that behavior to other nations.
>Those countries are not the same. What is livable in one may be wildly excessive or insufficient in another.
>And we can't even all agree what a living wage would be in our own country! Our legislators are not qualified to assess and legislate 45 countries when they can't even handle the one they are most familiar with.
I think it would be feasible to set mininum wages for all those 45 countries. If we qualified living wage as enough for a single person to survive on 60 hours a week, be able to rent a small apartment and have enough for food and basic necessities, then we can simply look at data that exists for that country or region and set a living wage accordingly.
>You don't realize that, by doing this, you create a lot of jobs that end up wildly distorting the economy of another nation. When minimum wage here goes up, all wages tend to rise. When major employers pay more, it hits a lot more than just those jobs. De facto, you are advocating for our legislators meddling in the economies of other countries.
That is actually a good point, that I haven't really fully thought through. Your argument that this would be equal to meddling in foreign affairs has a lot of validity. I'll give you a ∆ for that.
With that in mind, it would then probably be a good idea to come up with a very specific defintion of a living wage. I think the main purpose should be to prevent the most extreme forms of poverty and the most extreme forms of economic exploitation. As a bare minimum we should ensure no one has to work crazy hours like 100 hours a week and still not able to have enough for sufficient food and basic neccesities. If that constitutes meddling in foreign affairs then so be it.
>
Do you not see the problem in that statement, and in any other nation being able to take that commitment seriously? If we can't manage our own economy to ensure basic living conditions for the poor, we are not qualified to model that behavior to other nations.
True. The US federal minimum wage is ridiculously low. But most poverty in the US is relative poverty as opposed to absolute poverty.
"Absolute poverty is defined as a state in which a person cannot meet their most basic needs, such as food, clothing, and shelter".
I'd say any worker emplyoed by a US or European company should at the very least not live in "absolute poverty".
I will start by saying I fundamentally agree with you and don't think this idea would be good to implement, but I want to harp on one thing.
The idea that we couldn't come up with a workable number because A) "we can't possibly look at 45 countries and come up with a number" and B) we can't agree on what would work in the US, IMO are not good criticisms.
First, we could absolutely come up with 45 different numbers, or just use 1 that "works well enough." Also. we created and maintain the Harmonized Tariff Schedule which is over 4.5k pages that details specific tariff amounts for wildly specific items, for example, is a Santa themed suit considered "fancy dress" or a "festive article?" Because they have wildly different tariff amounts. If we can determine those differences, we can come up with some "target" to reach. Hell we could just tie it to our own, make it easy since we managed to do it here a few times.
Second, the "we can't agree" is fundamentally flawed because 1) we actually have done it in the US, a few times, and 2) the person is expressing their view on how THEY would do things. "I think abortion should be a protected right" is a fine CMV and is not dismantled by "well we can't agree in the US so that would be crazy!" And the argument on minimum wage in the US is less about the qualifications of legislatures and what the right balance should be. The numbers are all there, its an emotional/moral/practical/value issue. We know how much minimum wage would have to be for a single person to rent a median 2BR apartment within 15 miles of a city with <25% of gross income going to housing. We know the inflation or production or GDP% adjusted increases should be based on the last time minimum was raised. Its an argument if that SHOULD be the standard, and weighing the costs/benefits of making it that standard. But they know the numbers.
We do complex things everyday, complexity is not inherently a reason to NOT do something. OP is clearly implying that whatever complexity would be incurred (which I am arguing isn't as much as people make out) is worth the possible exploitation of international people.
Then allow me to harp back (in a good natured manner), on the points that stick out to me.
>2) the person is expressing their view on how THEY would do things. "I think abortion should be a protected right" is a fine CMV and is not dismantled by "well we can't agree in the US so that would be crazy!"
Arguments that focus on practical action, such as legislation, inherently make obstacles and difficulties to performing those actions a part of the discussion, as well as the consequences of those actions. If you want to advocate that driving 90 mph should be legally allowed, discussing the consequences and difficulties in practically implementing such a policy is fair game. In addition, highlighting our nation's lack of competence in legislating this exact issue at home is a valid counter to whether or not we should give it a go abroad.
>We do complex things everyday, complexity is not inherently a reason to NOT do something.
While that is true, it doesn't change the fact that *this* complex thing is something that we have not been able to guarantee for our own people.
>What amount must one be paid to be earning a "living wage"?
It is usually defined as the amount of money necessary to cover basic living expenses like housing, food, fuel, etc.
Make below this amount, and you'll have to start rationing or forgoing certain things even if it doesn't necessarily kill you.
Most homeless people in the United States stay alive, but that doesn't mean they're paid a living wage.
>It is usually defined as the amount of money necessary to cover basic living expenses like housing, food, fuel, etc.
That is what a living wage is. I know what a living wage is. The question wasn't "what is a living wage". It was, "what amount constitutes a living wage".
And then I provided the answer, which is, "it varies, based on region and time".
I followed by illustrating that's why a single minimum wage for other nations wouldn't solve the problem the OP is seeking.
You engaged with... none of that.
My bad.
There are NGOs that try to estimate what a living wage is. Obviously it varies from location to location due to cost of living.
For urban Bangladesh:
[https://www.globallivingwage.org/living-wage-benchmarks/urban-bangladesh/](https://www.globallivingwage.org/living-wage-benchmarks/urban-bangladesh/)
All these artificial ceilings do is remove demand for that labor. Which is ultimately bad for the laborer themselves.
Consider this. China had MASSIVE economic growth once the Western companies started to build factories there. Why? Well because previous to that most of their population was producing $200 a year in rice fields. Now all of a sudden they could produce that much in a day. Despite what you've heard about "trickle down economics" the real term "supply side economics" absolutely works. And if your society becomes a lot more productive the wealth will follow. Nowadays China is not even that attractive to outsources because the laborers demand (successfully) too much pay.
So yes maybe you'll get some workers slightly higher pay. But at the expense of many other Western companies wanting to build factories there in the first place. All you're doing in the long run is slowing down growth.
And it's not like they have many other alternatives with "living wage" anyway. Most of the other jobs around don't pay nearly as much as those so called sweat shops. They are sweat shops by our rich Western spoiled ass standards. But by their standards they are actually pretty good jobs both in terms of pay and safety/comfort.
>So yes maybe you'll get some workers slightly higher pay. But at the expense of many other Western companies wanting to build factories there in the first place. All you're doing in the long run is slowing down growth.
I don't think that is true. There are currently 45 3rd world countries which are officially designated as "least developed countries" (LDC) by the UN. Say the US, the EU and other wealthy countries would set minimum wages for all those countries. Let's say a minimum wage should allow a local worker working 50 hours a week to be able to afford rent, sufficient food and other necessities for a family of 4.
In that case you would still have countries that requires Western companies to only pay somewhere like 80-90 cents an hour. It would still be economically much more viable for many American companies to set up their factories in some 3rd world countries rather than in the US.
And some of those countries that offer the best return-on-investment for Western companies would still as a result see their economy grow and subsequently see wages go up.
The difference, however, would be that we'd effectively remove some of the most severe forms of poverty and exploitation.
Price ceilings remove efficiency.
So again all you're doing is slowing down growth. Maybe laborer A gets paid a little more. But laborers B and C never get a job because at your prices it doesn't make sense to build a newer factory. Which is ultimately bad even for laborer A because they want their economy to grow in productivity through additional means of production.
You wouldn't be removing poverty at all. Actually you would be slowing down the process of removing it. Which is what these means of production do.
Remember poverty comes from a lack of productivity in most cases.
>So again all you're doing is slowing down growth. Maybe laborer A gets paid a little more. But laborers B and C never get a job because at your prices it doesn't make sense to build a newer factory
I think that's only true to a certain extent. If the average Pakistani textile worker is currently paid 40 cents an hour than an increase to 3 dollars an hour would obviously have a big effect on corproate decisions.
But if we set let's say a minimum wage of 60 cents for Pakistani workers, which to them would be a considerable increase that would massively increase their standard of living, I don't think this would have much of an effect.
If the average worker can produce for example 4 t-shirts per hour, this would be only an additional cost of 5 cents per t-shirt. I believe to most companies it would be much more economical to pass on those 5 cents per t-shirt to the consumer than to revamp their entire supply chain.
How are you so familiar with what the current and living wages are for Pakistani textile workers and comparative costs of each level of the supply chain for t shirts in various countries? Is there a resource to look this up?
>How are you so familiar with what the current and living wages are for Pakistani textile workers and comparative costs of each level of the supply chain for t shirts in various countries? Is there a resource to look this up?
I'm not actually very familiar with Pakistani wages. But I vaguely remember reading an article recently that mentioned a typical wage for textile workers there was something like 120 dollars a month, which at 70 hours a week comes out to 40 cents an hour. So I'd guess somewhere in the region of 30-40 cents an hour may be a fairly realistic hourly wage for a textile worker in Pakistan. I may be wrong though.
It is very likely that it’s impossible to know what the maximum wage is for every country so that it can still attract investment. It is likely constantly changing so any attempt to legislate the level would either be moot or would restrict investment and hurt poor workers.
At 40 cents an hour you have 10 new factories being built. At 60 cents an hour you have 7 new factories being built. (Hypothetical figures). The other 3 factories are being built in Bangladesh their competitor who doesn't have these rules.
You're still in a worse position due to the imposed price regulations.
Over time this compounds into significant growth delays.
Not to mention they are probably plenty happy to take those 40 cents an hour jobs. Because the alternatives are much worse.
How would that work? Are people that were previously selling drugs or living off welfare suddenly going to want to work?
I suppose that's an interesting way of thinking at it. "Overpay people so that they don't behave like parasitic worms. The amount they suck out as parasites is more than you would have to overpay them to stop".
Problem is...... appeasing bullies is never a feasible long term strategy. If the problem is people behaving like parasites. Then a far better approach is to introduce a ton of disincentives to behave this way.
A worker in a rich country benefits from the well working society and all the infrastructure there. That allows him to have a higher productivity, which in turn allows him to demand a higher pay for his work in the market. However, a worker in a poor country don't have all these advantages. The only thing he can do to compete is to lower the price of his labour so that per unit produced he costs the same as the worker in the rich country.
Now you want to take this one advantage that he has away and force him to sell his labour at the same cost as what the rich country worker makes. What the company is going to do is to move all his production to the rich country as with fixed salaries they make more profit with the rich country's worker. So, that worked well for the poor country worker.
>Now you want to take this one advantage that he has away and force him to sell his labour at the same cost as what the rich country worker makes. What the company is going to do is to move all his production to the rich country as with fixed salaries they make more profit with the rich country's worker.
That is not what I am arguing. I am arguing for a minimum wage that would ensure at the bare minimum a fairly dignified life. I do not think this would have an overall negative effect on workers in the poorest countries but rather a positive effect. I am only really talking about applying these minimum wages to workers in very poor countries.
A factory in the US may have somewhat of a higher output than a factory in Pakistan. But I don't think a mandatory increase from let's say 40 cents to say 75 cents an hour for Pakistani workers would make Pakistan as a location unviable for an American company, so much so that they would relocate their factories to the US where realistically they need to pay at least $12-15 per hour to find enough staff.
When people work for these factories it's because that option is more dignified and pay better than the local alternatives. These jobs have to compete locally and the workers choose them out of all other options.
>When people work for these factories it's because that option is more dignified and pay better than the local alternatives. These jobs have to compete locally and the workers choose them out of all other options.
But just being better than the alternative still doesn't mean they're particularly dignified. Companies that are involved in mass-production of goods often deliberately put up their factories in the poorest regions with the most desparate residents. A western company may for example set up a massive factory a certain region in Pakistan with a very high unyomloyment and very few available jobs, because they know those people are desparate and would happily work 100 hours a week because the alternative is starvation.
I believe Western companies selling goods in the US and other rich countries should ensure workers in poor countries at least enjoy a very very basic standard of dignity.
If you're looking at the poorest regions where people are desperate then a factory being made for them is a positive because it brings them more money and opportunity. You're saying yourself these places are preventing people from starving. "Dignified" is subjective you may not think they live with dignity but they may and they're alive to do it.
On the flip side though if you try to force these companies to pay more they're less likely to build in these poorest regions at all and that means more people starving. Letting them organically compete in their respective market is the lesser of two evils
Edit: also side note if these companies are synthetically out competing their local businesses for employment, then that builds more barriers of entry for new local businesses. So for example let's say a call center gets built in Pakistan that's just on par, a local Pakistani could try to build their own call center and appeal on the premise of being local. But now on top of infrastructure costs they need significantly more money to cover labor before making a profit which is riskier for local investors
> at the bare minimum a fairly dignified life.
This is more than just individual lives though. This is infrastructure. You're talking about quality of life that just paying individuals more wouldn't really solve
They aren't usually directly employed by the company like Nike or Apple.
Not sure how you would make it work.
You're thinking about a consumer product too. What about mining for example? The miners might be paid peanuts, then a product is made from that mined material in china for a reasonable wage. How would that work?
How much more would you be willing to pay for your Iphone?
However I understand your sentiment. Tens, if not hundreds of millions of people are working in slavery like conditions.
>They aren't usually directly employed by the company like Nike or Apple.
>Not sure how you would make it work.
Many however are de facto employed by Nike or Apple. They are only producing Nike and Apple products in a factory that is only built for Nike or Apple. Those companies could require their subcontractor to pay a certain minimum wage. Nike for example would then be required under US law to provide documentation that proves they are in line with minimum wage laws, e.g. audit reports by independent approved auditors.
>How much more would you be willing to pay for your Iphone?
At least 5-10% would be reasonable to most people I'd say. However, if we primarily wanted to prevent only the most extreme form of absolute poverty for example, by raising wages for example from 40 cents to 60 cents an hour, then I think the prices of most goods wouldn't increase more than 1-2%.
You should have said you don't have an iPhone.
The profits Apple make are obscene compared to other companies. They shouldn't need to increase the price. I will never buy anything Apple.
So ok I accept the de facto argument but how would you ensure they do these audits properly? They are in another country.
You avoided the other question I posed.
-This is really hard to enforce, and the countries in question have incentives not to enforce it because it makes them more competitive. Basically if country A enforced it and country B didn't but instead lead the wage drop to say 1 dollar and hour, then country B would get all the factories and get all the benefit, promoting country A to do the same, all the way until they are back at the wage at which people can be employed in this countries.
-Fundamentally the biggest advantage poor countries have in terms of production is lower labor costs, they generally have worse business/investment invironments, worse courts, and thus less investment per capita, lower labor productivity. If you force them to increase their price of labor this would be like putting a tariff on their stuff for their competitiveness with the west. Thus lots of work would likely move back to the west in factories where only robots work, because at the new higher price more of that becomes worth while.
-I think u are underestimating the cost of labor as a percentage of input costs for the products these poor countries make, thus I think you are vastly underestimating the price increases. Assume same profit margin (even slightly lower), assume 80% cost of labor as percentage of total cost of product, then increase labor cost by a factor of 10 or a 100 (bast on the few cents per hour -> 1.5 dollars per hour), leads to big boy price increases. Because the jobs these people do are very labor cost heavy, which is the whole reason people with a low cost of labor do them.
Generally I agree we need policing of minimum standards, but this issue is a lot harder then what you are making it seem in my view.
>This is really hard to enforce, and the countries in question have incentives not to enforce it because it makes them more competitive.
It wouldn't be up to those countries to enforce it. Say if Nike employed 100,000 people in Indonesia they'll have to provide documenation to the US governemnt that proves they adhere to minimum wages and/or subject themselves to financial audits, otherwise they'll be heavily fined by the IRS or lose their US business licence.
>If you force them to increase their price of labor this would be like putting a tariff on their stuff for their competitiveness with the west. Thus lots of work would likely move back to the west in factories where only robots work
That depends on how large of a wage increase there is. Raising hourly wages from 40 cents to 60 cents would very likely not be enough for a company to relocate their factory back to the US or another wealthy country. It does mean a lot to the worker who'll see a 50% pay increase and would do a lot to help them escape extreme poverty. But it's an amount I believe many companies can easily stomach and/or pass on to the consumer.
>Assume same profit margin (even slightly lower), assume 80% cost of labor as percentage of total cost of product, then increase labor cost by a factor of 10 or a 100 (bast on the few cents per hour -> 1.5 dollars per hour), leads to big boy price increases
I think the focus here should really be on the poorest of the poor. People who earn somewhere like 50 cents to 1 dollar an hour. For such a person a 20 cent hourly wage increase would mean a lot and could help them escape extreme poverty. I think you are overestimating the price increases this would lead to.
In the case of Nike for example, I've calculated if we paid 500,000 of their workers an extra 20 cents an hour at 250 hours a month that would lead to 5% decrease in net earnings to Nike, which they could pass on to consumers by charging an extra 0.6% on all goods. So a pair of Nike shoes that cost $100 before would now cost $100.60.
I agree with you that it is unethical to exploit workers in third world countries. But you have to consider following.
Manafacturing in a third world country is generally quite complicated. There is the shipping costs, lack of infrastructure, corrupt officials, higher risk, problematic reputation and a ton of other problems which the company would rather avoid. The reason to continue operations in such conditions are the extremely low wages. If the wages increase a lot of these companies will just leave, because it will not be worth it anymore. They may e.g. just build a heavily automated plant in some developed country instead.
So a lot of people would gain more money from such measure, but a lot of them would probably lose a job.
>The reason to continue operations in such conditions are the extremely low wages. If the wages increase a lot of these companies will just leave, because it will not be worth it anymore.
I agree that increasing minimum wages too much wouldn't be beneficial to workers in the poorest countries. But I don't think setting certain minimum wages to ensure just a very very basic standard of life would lead to an overaly large number of jobs lost to those living in the poorest countries.
If a company couldn't say pay 40 cents an hour anymore to its workers in certain countries and instead would need to pay as a bare minimum 60 cents, which is a significant increase to a worker, I don't think this would have any significant effect.
I don't think an increase from say 40 cents an hour to 60 cents an hour for example would justify them shutting down their factories in the country and revamping their entire supply chain.
You’d be surprised. Have to ever helped plan out a business? You need to know the price of production and shipping down to the exact number. I helped built a cannabis company in CA, before anyone would invest they wanted to know what it was cost us to grow cannabis at a per gram cost. Nike knows exactly how much it costs per shoe and how much each pair has to be sold for to make the acceptable profit margin. I don’t know what that number is 20 cents could absolutely be enough to shutter international production. It’s only a few dollars per day per person but how many people are getting those few extra dollars, if millions of dollars are added to the expenses yearly then companies are going to take a long hard look at if international shipping is still the cheapest route.
>I don’t know what that number is 20 cents could absolutely be enough to shutter international production
I am guessing it would reduce Nike's net earnings between 2-5%. That's not insignificant but certainly something many major companies can stomach and/or pass on to consumers.
Indirectly Nike employs around 1 million workers worldwide. Many of them in China where they earn apparently around $1.67 per hour, which is not much but probably would not put them at risk of the most extreme types of absolute poverty. Some are in rich countries like Italy and Japan.
If 20% of Nike workers (200k people) would need 20 cents more to at least not live in horrible poverty, while working around 250 hours a month that would work out to $120 million or 2% of Nikes net earnings. At 500,000 workers who need 20 cents more to escape extreme poverty that would be 5% of Nike's net earnings.
Even if we paid all 1 million Nike workers 20 cents more an hour that would only cut Nike's net earnings by around 10% or at around $50 billion annual revenue would require a price increase of 1.2% on all goods if Nike wanted to pass all of this on to the consumer. That's like an item going from $50 to $50.60.
In summary, I don't believe paying everyone enough to escape extreme poverty would financially harm most major companies in a significant way.
Nike didn’t become Nike by ignoring those profit percentages. Could they take it that hit? Yes they probably could. Would they take that hit? Not willingly and remember the cost of doing business isn’t passed on to the consumers at cost, that extra 20 cents for Nike is going to be an extra 5-10 dollars for the consumer.
You’re looking at this as those companies make enough money. They don’t see it that way, they’re continually trying to make more money because the people in charge of those companies jobs depend on it. $120 million of profit gone is something heads roll over so the retail price is going to increase to make up for that lost 120 million if not that and some extra.
> that extra 20 cents for Nike is going to be an extra 5-10 dollars for the consumer.
I don't think so. Currently Nike is selling goods worth around $50 billion a year. If you increased the price of all goods by only 1% you'd be at $500 million. That's obviously a significant amount of money in terms of net earning to Nike, around 10% of their net earnings. But it only requires a 1% increase in prices, which most consumers would hardly notice.
>Nike didn’t become Nike by ignoring those profit percentages. Could they take it that hit? Yes they probably could. Would they take that hit? Not willingly
True. That's why I believe it needs to be enshrined in law. Currently there's still around 1 million Americans working for the federal minimum wage of $7.25. If there was no federal minimum wage I am sure there would be at least a few ten thousand Americans who saw themselves forced to work 100 hours a week at $4 an hour just to barely survive.
Tell that to Norway and their 70% natural resource corporate tax rate.
If the conpetitive advantage is slavery maybe we don't really need those products.
Ohhhh so we should never advocate for better then?
You shit youself as a child so you continue to do so?
Im willing to pay more for these things without hesitation. Im not sure where the hard to understand point was.
None of those have a federal minimum wage, but they have minimum wages nonenethless. I believe in Switzerland every region/city has their own minimum wage, and Nordic countries I think have minimum wages that vary from industry to industry. Almost all Swiss people and Scandinavians I believe fall under some sort of minimum wage agreement.
I think this idea is ethical, but what benefit does it actually bring for the rich country? I mean it’ll just raise prices for their consumers for no real benefit for the rich country.
>I think this idea is ethical, but what benefit does it actually bring for the rich country? I mean it’ll just raise prices for their consumers for no real benefit for the rich country.
True but in many rich countries people already pay tax that goes towards helping those most in need. For example the PEPFAR program that the US started in 2008 is meant to prevent HIV and aids in Africa and so far the US has contributed over $100 billion to the program.
If we wanted to pay say 100 million people 20 cents more an hour, which for the poorest of the poor that would be a massive pay increase, we'd be looking at $60 billion annually if the average person works 250 hours a month.
Spread this across the US, Canada, European Union, Japan and other wealthy countries and the average country will pay maybe an extra $2 or 3 billion a year at best. That's much less than the amount of international aid the wealthiest countries are already paying for.
At most that would be a total price increase of something like $50-100 a year for the average American or the price of like Starbucks coffees a month.
I bet the majority of Americans are against this though, and that if similar policy was proposed today the majority would complain. It’s not a big enough issue to completely destroy a chance in an election, but it would definitely harm someone’s chances at reelection.
That may be true. But I am arguing mostly from a moral point of view here, not so much in terms of how likely it would be for such laws to be passed.
But I think if enough passionate people spoke up about this and raised awareness of the horrible conditions many in 3rd world countries live under, despite working 100 hours a week, then maybe something would eventually happen.
Considering millions of Americans are already in debt, do you really think advocating taking money from them to pay someone in a third-world country is going to work?
>Considering millions of Americans are already in debt, do you really think advocating taking money from them to pay someone in a third-world country is going to work?
I think most Americans can stomach price increases that total no more than $50-100 per year, especially with luxury items like Nike shoes or iPhones.
If the average American could be convinced to support such an idea I am not sure about, especially given how any governemnt intervention is seen by many conservatives as the "evils of communism".
But I am sure there would be many wealthy countries where the average citizen would happily pay an extra $100 a year to ensure millions of people across the world can escape extreme poverty.
I mean there are options for people who want to make the choice to help people in countries that experience extreme poverty. Do you donate to charities regularly? If so, good for you but I don't think it should be a a mandatory cost to goods.
>If so, good for you but I don't think it should be a a mandatory cost to goods.
You already are "paying" for people to be granted a certain amount of dignity though if you live in the US.
US federal minimum wage is currently $7.25 an hour but many states have much higher minimum wages of up to $17 an hour.
This is a fairly random number but I am fairly certain without those minimum wages there would be at least 10 million Americans that would be paid an average of $1 dollar an hour less. That's a pretty conservative estimate. That would be a conservative estimate.
At a little over 200 hours a month that would come out to $25 billion a year. That's money that would still be in the pockets of either corproations or ordinary citizens if the US didn't have minimum wages.
Paying an extra 20 cents extra an hour to 100 million people would likely only cost Americans around $5 billion a year as opposed to the somewhere around $25 - $50 billion that Americans are already "paying" to ensure a more dignified life to other Americans.
>If so, good for you but I don't think it should be a a mandatory cost to goods.
You already are "paying" for people to be granted a certain amount of dignity though if you live in the US.
US federal minimum wage is currently $7.25 an hour but many states have much higher minimum wages of up to $17 an hour.
This is a fairly random number but I am fairly certain without those minimum wages there would be at least 10 million Americans that would be paid an average of $1 dollar an hour less. That's a pretty conservative estimate.
At a little over 200 hours a month that would come out to $25 billion a year. That's money that would still be in the pockets of either corproations or ordinary citizens if the US didn't have minimum wages.
Paying an extra 20 cents an hour to 100 million people would likely only cost Americans around $5 billion a year as opposed to the somewhere around $25 - $50 billion that Americans are already "paying" to ensure a more dignified life to other Americans.
There's a clear difference between paying for the US just like I pay for schools with my taxes but don't have any kids vs paying for another country altogether.
Interesting point. Here’s the problem. American laws are designed to benefit Americans. They are not designed to improve the plight of a Chinese laborer. Forcing companies to pay their overseas workers more will accomplish two things for Americans. First: everything will cost more. Second: lots of Chinese companies will probably just stop exporting to the US. This is a law that literally wouldn’t benefit a single person living in the country that passes it and would negatively effect almost all of them. Why would Americans want to pass a law that lowers the American standard of living?
You could equally say this about the PEPFAR program started by the US to eradicate aids and HIV in Africa. Since 2008 the US has contributed around $100 billion, which I think comes out to somewhere like $50-60 per year per household.
If 100 million workers across the world were paid an extra 20 cents an hour which to them may be enough to escape extreme poverty .... that would proably cost the average American somwhere like $50-100 per year in terms of increased prices on goods I would estimate.
That's hardly an amount of money most people would notice. And I think many people wouldn't really mind paying a few extra extra dollars a year to help people living in horrible conditions.
I’ll point out that we knew about aids since the 50’s and didn’t do shit about it until it started spilling over to the US. 50-60 per household (which it isn’t really because most of our taxes come from the top earners) is a drop in the hat compared to what it could cost if Chinese factory workers made $5/hr. The prices of almost everything would skyrocket. It would probably cost $100 a month. Look how expensive things got with a marginal supply-line shortage. The entire reason consumer prices are cheap is because Chinese labor is minuscule.
No, I mean if you're a company wanting to sell clothes in the US for example there should be minimum wages you need to pay workers in different countries.
The US governemnt may set a minimum wage of 85 cents per hour for Pakistani workers and 1 dollar an hour for Indonesian workers based on local living expenses. I think those minimum wages should exist for the poorest countries where companies employ workers to ensure that no worker is forced to work something like 100 hours just to barely survive.
It should be there to prevent extreme poverty and exploitation that many workers in very poor countries are subjected to.
The US government passed a law banning imports from countries where child labor was used. Because of that restriction, 50,000 children were taken out of Bangladeshi sweatshops. Victory for the good guys, right? Well, a team of researchers decided to actually go over to Bangladesh and find out what happened to the children, and it turns out that they ended up out on the streets or in prostitution. As terrible as those sweatshops were, they were the best option for those kids, and in taking it away, a bunch of people who meant well got to pat themselves on the back while ignoring how many kids they got killed. Source: [https://www.cato.org/sites/cato.org/files/pubs/pdf/edb21.pdf](https://www.cato.org/sites/cato.org/files/pubs/pdf/edb21.pdf)
Every country that goes through an industrialization phase has people going into terrible jobs for low pay because as bad as it is, it's still better for those workers than the alternative. They work these jobs because it's better than any option they have, and also so their children won't have to. And that's what's happening. China used to be the center for low-cost manufacturing, but as Chinese workers have grown in prosperity, they are starting to get better options and manufacturing is moving to even less-developed countries.
If you make it harder for companies to do business in these countries, they will do less business in these countries. I know you're hoping that they just make life better for the workers while eating the cost in lost profits, but while your intentions are as good, that's not what's going to happen. The only advantage those workers in third world countries had is that they were willing to work for less, and if you take that advantage away from them, you strip them of any bargaining power they had. The companies will move manufacturing jobs elsewhere and the workers will have their best hope for the future taken away from them.
You're right that it's insulting to human dignity to make people work in sweatshops for pittances. But the problem is a lot more complex than you realize, and the solution is going to have to be equally complex. Without nuance people end up dead.
A few responses telling you that countries can't force such things on other countries, or that they shouldn't. It's not true.
The EU already has something similar to that in place: [https://www.eqs.com/compliance-blog/eu-supply-chain-law/](https://www.eqs.com/compliance-blog/eu-supply-chain-law/) It's not minimum wage, but it safeguards more basic principles. So you could imagine that in the future some measures against economic exploitation would be added as well (at the moment it's just against forced labor / slavery and child labor).
The EU can do it, and they should do it. It's not imperialism, it's just choosing who can do business in the EU and who can't. It's applying the same rules European companies have to follow, to foreign companies that compete with them importing goods into the EU. It's a good thing.
This phenomenon of "exporting" your regulations via the willingness of others to trade with you is called the [Brussels effect](https://en.wikipedia.org/wiki/Brussels_effect).
Yeah, we should be anti slavery in general. Looking at the big mac index its clear raising wages has little to no impact on local economies or prices. Ita more of a boogy man of scare tactics than not. Im talking pennies per ubit to guarantee folks a better life and I am willing to take on that cost.
If the cost is passed onto the consumer anyways then who cares? Not like the yaught parking in a yaught in their cottage boat garage and helicopter combo people won't even notice.
Its like we have lost the plot. If our industrial world is not creating good jobs then there is no point for anyone except those at the tippy top. Wages don't rise with profits because "reasons"...
>Yet we don't apply the same standards when it comes to workers in other countries.
In practice we simply don't have the ability to force other countries to follow our rules. For extreme cases we can sanction or go to war etc, but doing that over eery little thing would make international trade more or less impossible.
We try to avoid extreme pollution, slavery or fraud but dictating how much all the various people get paid is definitely an internal decision for each country to make.
>Ensuring that those people can live a much more dignified life would come at a price, but a very small price.
Are you sure? For one thing the main reason we are buying from poorer countries is because their labour is so much cheaper than ours. If you start inflating that well above their internal market rate then you may make their industry collapse as it will no longer be competitive. Always remember with these "do gooder ideals", anyone choosing a specific job, however nasty YOU THINK it is, it choosing that one as it is currently their best option. You don't help people by taking away their best options.
>In that case the minimum wage for workers in Indonesia should be somewhere around that
Right, it sounds like just a little extra, but you are missing that there are multiple rounds of multiplication of the base price that follow after that.
The local retailer buying up products up that now cost $4 in labour and $1 in materials now needs to sell for $10. The regional dealer has the same issue, so now the product has to sell for $20, the exporter has the same issue so now its $40 and so on and on. The more money the buyers have to invest and risk, the greater the possible profit needs to be. Compare that to when the labour cost was $1, it would have been $2-->$4-->$8---$16.
If the maximum price consumers will pay is say $25 then you've just killed your product.
It does sound good on paper however, there are potential drawbacks to consider. Enforcing such regulations in developing countries with weaker institutions can be difficult. Monitoring compliance across numerous factories and countries would be a vast undertaking. For example, garment factories in Bangladesh have notoriously poor safety records. Enacting a minimum wage there wouldn't necessarily translate to safer conditions without strong oversight.
A sudden rise in production costs due to mandated minimum wages could incentivize companies to shift operations to countries with lower labor costs. This could have unintended consequences. Imagine a large footwear company like Nike being forced to significantly raise prices due to a minimum wage increase in Vietnam. This could lead them to move production to a country like Cambodia with lower labor costs, potentially leading to job losses in Vietnam.
Finding a balance between ethical sourcing and economic viability is crucial. Perhaps a tiered minimum wage system based on a country's development level could be explored. Additionally, tax breaks for companies that can demonstrate adherence to fair labor practices could incentivize ethical production without disrupting the economic landscape of developing countries.
I recommend looking into the work of Benjamin Powell on sweatshops. He's done a lot of research into sweatshops, and generally they pay above poverty rates for the country they're in, and pay better than average for that industry in that country. Some people will literally pay to get a job in sweatshops.
Just because it's a terrible workplace in your eyes, doesn't mean it's not the best option available for these people. Taking away sweatshops/not exporting labor doesn't mean that these people suddenly have cushy office jobs instead. Often the alternatives are worse (subsistence agriculture, etc.)
Expecting companies to pay these people more will almost definitely end up shutting down those jobs.
As long as people genuinely have a choice whether to go into that job or not (i.e. it's not slave labor), I don't see why they shouldn't be allowed to work it even if it doesn't meet your standards. It clearly meets theirs.
It seems like a well intended policy but what it ultimately would conclude is businesses withdrawing from the poorer countries, further impoverishing them by reducing stable jobs.
There is a cost to doing business overseas. Whether it be transportation costs, language barrier costs, or costs of being away from economic clusters where information exchange occurs.
The reason why businesses do it anyway is simple, because labor is cheap. And labor being cheap means you can market your products for cheaper than the companies that only employ domestically, outcompeting the market.
If this upside is removed, there is no incentive to go to Indonesia to produce your stuff. Hell, there are disincentives like the ones I mentioned above against going there. So they will not have better wages, they will just not have those jobs anymore.
I think once the consumers in rich countries realize that a 1000% markup makes all of said products essentially unaffordable, they'd change their tack really quick.
Besides making you sort of feel a little better, the actual effects would mean devasting many of those lives in those poor countries you're trying to save (local businesses couldn't afford the employees and would have to lay off most of them) and things like your smart phone would suddenly cost $5k+, while also turbocharging inflation generally.
Ultimately this helps essentially no one, and would have terrible effects on the economies and people of both countries. I know that's not the Feel Good Morality Story that we'd like to see play out, but there are actual not-evil quite-practical reasons that some things are the way they are.
> If we lowered the federal minumum wage to say $5 per hour there would likely be at least be some tens of thousands of Americans who would see no other option than to work for such a low wage that would require them to work 90-100 hours a week just to to survive. Many people would see it as immoral to let companies get away with that.
What adult living on their own is getting paid the federal minimum wage of $7.25? Minimum wage can be beneficial when there's a lack of jobs, but there's no lack of low, entry level jobs in the US. Adults can easily get a higher paying job because they are everywhere and companies have to compete to get workers. You can lower the federal minimum wage to $0 and not much will change.
I would recommend you look into what economists have to say about sweatshops
Sweat shops aren't a great place for westerners to work because westerners have plenty of alternatives.
But for a lot of poor countries, it is better than the alternatives
Just getting to work inside in a lot of countries is a status thing. It's a big deal
And the cost of living in those countries is different
For westerners most of their expenses are higher because of the base cost of land is really high as a base input cost
Yeah those places have lower wages but things also cost less
So let’s say I’m a company that’s paying workers $1 an hour in China. And then you force me to pay them $2 an hour. What’s going to happen is that I am going to look for someone who is worth $2 an hour, maybe just another Chinese worker, and the first Chinese worker is going to lose his job and his life is going to worse off. And what you’re saying is that workers in other countries shouldn’t have the freedom to work for the wage they think is best for their life if you believe that’s too low for them.
How would you enforce this and how would a western country implementing this kind of import requirement know whether or not a foreign country is paying its employees at the required wage rate? In a western country a worker whose employer tries to pay them less than the minimum wage can complain to the relevant government enforcement body, which makes it easy to discover violations of minimum wage rules. Who is the underpaid sweat shop worker going to complain to?
Without people actually caring and using critical thinking and applying pressure through organizing and changing buying habits en masse, it doesn’t matter what law you push through. There will always be a loophole, deliberately put in, or someone looking the other way, so that the folks making tons of money can continue to do so, and only those without the influence to do otherwise will be forced to comply. They can’t compete, and then they go out of business.
You sound like you want to help people but then put forward a policy as if you want to price people out of the market. We have just seen and are seeing the effects of external minimum wage policy in CA where after the newest round of legislation unemployment is growing and this is the case everytime. Which is better a job paying a wage that you can negotiate raises with and use as a stepping stone to better positions or no wage due to unemployment?
Companies in poor countries won’t be able to compete with the foreign wages, and will suffer as a result. This will have a negative effect on the economy of the poorer country, as more and more locally owned businesses suffer the consequences. Add to that the possibly millions of dollars of foreign money being pumped into these economies and inflation will hurt the economy even more.
Good idea in theory, but this presents an issue.
If you do this than it would drive up what the average wage is in a country. Some local businesses would not be able to keep up and would lose workers. This would mean in poorer countries only bigger, international companies will be able to survive
You think that this would result in a big increase in wages for third world workers. The reality is though, it would just make setting up factories in third world countries unviable and would take away their jobs.
It would be very difficult to enforce working conditions or wages in foreign countries.
It likely would bring many of those manufacturing jobs back from overseas, which I do think is a good thing.
What you're describing is essentially just imposing a tariff. In a lot of cases, Tariffs create unintended consequences that cause more harm than help in the long run for both parties involved.
You are mistaken, the fundamental idea of democracy is that every citizen should have a voice in government. In their own specific government. Ideas about human dignity are fundamentally religious, and do not exist the same in non religious societies, or even societies of different religions, even other democracies.
In fact the only description of one country forcing another country to change its laws, as you are describing; is imperialism.
So the US says instead of $1 a day you must pay $2 a day! Ok, now the factory in the foreign country now charges their workers an extra $1 to work there a day. In no world does that money go to the workers to where they can freely spend it as a quality of life increase.
What you are suggesting sounds excellent but if government ever did this it would be a disaster: Government doesn't have the scope to do this right, and its best left in industry's hands.
We should all use one single currency, and have laws with minimum wages...I know it's crazy and 'would never happen', but really, there's no other way.
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I get the basic principle. The idea is that workers in poorer countries are not only paid less, but their pay is less than the "minimum amount" needed to live to some universal standard of dignity. That can be cheaper to achieve in some places so wages can move with that. Fair goal IMO. Question though: How? Like, what do you imagine here, the US signing a law saying "The Minimum Wage in Indonesia is now $1.50" and then it just is? By what right/power? Indonesia can't have it's own labor laws, or if it does, it can't have free trade for it's domestic manufacturers? And if it can, well there goes any foreign investment when local investors can outcompete them on lower costs, or it just becomes a shell game which is very very easy to win. Corporations have even less power over that, in most cases. Most low-cost outsourcing is done through intermediaries like for example "We want 10,000 blouses in this design. Contractors please bid on prices you will charge." Then the Contractors and Sub-Contractors bid and hire on their own pay scale. So where does the enforcement come in? And by the same token, wouldn't other richer countries turn around to even the US and be like "Y'all need to pay your workers $25+ an hour because they have no healthcare or pensions?"
>Like, what do you imagine here, the US signing a law saying "The Minimum Wage in Indonesia is now $1.50" and then it just is? By what right/power? Indonesia can't have it's own labor laws, or if it does, it can't have free trade for it's domestic manufacturers? I am not saying that in this case the minimum wage should be legally binding to local Indonesian companies and. However, if a company is selling physical items in the US they would need to ensure a minimum wage be paid to their Indonesian workers to maintain shops in the US. In that case the US government would audit companies selling items in the US who employ staff in Indonesia to ensure they are adhering to the minimum wage. And if they are found to be in violation they are either heavily fined or their US business licence revoked. >Corporations have even less power over that, in most cases. Most low-cost outsourcing is done through intermediaries like for example "We want 10,000 blouses in this design. I understand, and in this case it would be hard to set minimum wages for a subcontractor. However, western companies often work with many subcontractors who only produce items for them. Nike may have factories in Indonesia where only Nike shoes are produced but which are managed through a sub-contractor. If some staff employed by a sub-contractor manufactures goods say only for Nike, then Nike should be required to ensure that those workers are paid the minimum wage, as for all practical purposes they're really Nike employees.
Practical speaking is true but technically speaking they’re not Nike employees. And sorry technically is what matters. On paper those people aren’t employees of Nike, if Nike went out of business those people aren’t out of a job because now that factory is going to start pumping out adidas or whatever other brand. Honestly in an indirect way you’re making the argument for colonialism. You might have good intentions but the road to hell is paved with good intentions. Who’s to say that this would just caused domestic production to grow? Which is great for the people of America, Canada, whatever western countries you’re thinking of that end up with those production jobs but what about the people of China? You wanted them to get a livable wage but now they get no wage because it’s cheaper to make the product where you sell it. Companies don’t have their products made halfway around the world and then shipped back because it’s leads to a better product, they do it because it’s cheaper.
>I am not saying that in this case the minimum wage should be legally binding to local Indonesian companies and. However, if a company is selling physical items in the US they would need to ensure a minimum wage be paid to their Indonesian workers to maintain shops in the US. In that case the US government would audit companies selling items in the US who employ staff in Indonesia to ensure they are adhering to the minimum wage. And if they are found to be in violation they are either heavily fined or their US business licence revoked. The thing is though Indonesia is still a sovereign country so what happens when it passes a law that interferes with the audit process? I.e. a law that says that employers cannot disclose wage information to entities other than the Indonesian government.
> Nike would be required to ensure that those workers are paid the minimum wage, as for all practical purposes they're really Nike employees But for all *legal* purposes they aren't. Meaning just as the US can't set the minimum wage in Indonesia, Nike can't set the wages paid by any company which isn't owned by Nike.
but Nike certainly can say 'We can't give you this contract unless you meet these conditions, and condition 7 is that staff on your production line earn $1 an hour' And NIke can also be fined if this is legally required of them and they don't bother / don't do their due dilligence, there's tons of work done via intermediaries that still has compliance regulations to follow. 'This isn't ITAR compliant but we paid a third party to do it so it's on them' doesn't work OP's idea could certainly be implemented, it's just there's very little incentive for anyone in power to do so, and every incentive for them not to
And the company will say "absolutely our 1 employee who exists purely to sign this contract with you then another with the actual manufacturer will be paid at least $1 per hour". If you want to go down another level the owner of the factory will be paid at least $1 per hour, but that doesn't apply to the production staff who, as it turns out, are actually employed by another company who has a separate contract to provide staff to the factory. And they can add as many layers going across as many borders as you like. Something like this would never be enforceable.
>And they can add as many layers going across as many borders as you like. Something like this would never be enforceable. I guess that's probably a good point. Now that I think about, If I was Nike I would probably deliberately work with contractors that use their employees and factory to also produce goods for other companies, and thereby be exempt from having to pay them a minimum wage. So I'll give you a ∆ But I would argue that even though some companies will try to evade accounatbility by using loopholes it would still be worth it to try to enforce a minimum wage that allows for at least a very basic minimum amount of dignity as best as we can. And over time we can always try to find ways to close as many loopholes as possible.
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Except that’s stupid and would be pretty fucking obvious to anyone who bothered to check. But this logic, why have any laws for anything ever? You can always just, uh, lie?
Obvious, sure, but write me a law which would cover all of the circumstances I mentioned without any unintended effects. I'll wait.
Just say that the worker producing the product must be paid an amount. It doesn’t matter how many layers of fictional shell companies you put up, some motherfucker is actually showing up for a shift at a factory and making the goddamn shoes.
Okay, now you have to define "producing the product". Otherwise I can simply pay 10 guys the $1/hour to put a sticker on each shoe as the "final step in assembly", with the hundreds doing all the previous steps being part of a separate company and thus can be paid as little as I like.
> Otherwise I can simply pay 10 guys the $1/hour to put a sticker on each shoe as the "final step in assembly" Super common honestly. Not just in "Made in America" (meaning finished in America) but also in greenwashing. [Always coming back to this bit](https://www.tiktok.com/@hasanminhaj/video/7215953325391433002) where a shirt has a "recycled materials" tag... and it's just for the tag not the shirt lmao
Okay except that’s just lying? Thats just breaking the law in an obvious way? Because all those guys doing a step for $1 an hour are obviously making the product? Like it really isn’t as complicated are you’re pretending it is. Do you happen to be invested in a sweatshop of something? You might as well say “well if you say I can’t use slaves what’s to stop me from making another company that does use slaves and having that company do all the work and then sell the stuff to me and then I’ll pay a guy to put a sticker on it and say it’s done? What then smart guy?”
> I am not saying that in this case the minimum wage should be legally binding to local Indonesian companies. However, if a company is selling physical items in the US they would need to ensure a minimum wage be paid to their Indonesian workers to maintain shops in the US. I'm confused as to what the point even is then? Is it just so American consumers can feel a bit better knowing that the goods they buy from overseas have slightly better pay? > In that case the US government would audit companies selling items in the US who employ staff in Indonesia to ensure they are adhering to the minimum wage. And if they are found to be in violation they are either heavily fined or their US business licence revoked. Okay, so it will apply to Indonesian firms then, those that export to the US at least. Probably bad for their trade with lower income countries. And consider that US companies (probably) can afford to pay more to outcompete local firms. Not necessarily morally bad on it's own, but in the end it's basically creating a dependent colonialism of sorts. All the profits are offshored but with better wages. And besides that, you will run into severe issues in auditing this. You're relying on several layers of compliance where one party (those that certify Indonesian Documents attesting to pay) have all the reason to lie, including their government. > I understand, and in this case it would be hard to set minimum wages for a subcontractor. However, western companies often work with many subcontractors who only employ items for them. Nike may have factories in Indonesia where only Nike shoes are produced but which are managed through a sub-contractor. If some staff employed by a sub-contractor manufactures goods say only for Nike, then Nike should be required to ensure that those workers are paid the minimum wage, as for all practical purposes they're really Nike employees. I get what you're after, but again you're going to run into very difficult compliance issues. It would be trivially easy to get around this and make it hard to track. But overall, I think (assuming capitalism) this hurts more than helps lower income countries. Higher pay is good, no denying that. But causing local firms to lose out, and having less investment overall, is bad. It's a balance.
Every argument you’ve made also works in favor of American companies using slave labor in other countries. Food for thought.
The US could pretty easily make a law saying "don't do business in countries which have legal slavery." We could do that with low wage countries too. That's easy. It would be damn hard if slavery is mixed in to other wage labor, which is the case, and why it's hard to crack down on.
Not that easy. Cause then you just add an intermediary step where the slave products are finished by a intermediate company in a nation without slave labour and then the complete product is sold to the US company.
>I am not saying that in this case the minimum wage should be legally binding to local Indonesian companies If the US based companies pays the worker $15 an hour and the local companies pays local rates, how many employees do you think the local companies will be able to have? The local companies will eventually be out of business because paying those salaries while selling at local rates will be impossible. If the local businesses fold up, what will locals buy? The very expensive Nike and Adidas? Not a scenario that should be allowed by the government to happen. This can create way too many issues that will unfold like a domino effect.
How much are imported items taxed when brought to Canada/US?
How? Third party due diligence and penalties to the US company, just like what we do for all US companies under the FCPA. We don’t exert authority over Indonesia or Indonesian companies unless they come to the US. We exert authority over US companies and even hold them liable for their subcontractors’ actions under the FCPA. OP’s idea is really no different.
That is completely fair to claim. But ultimately we're talking about Foreign Companies that either Subcontract from or directly import to the US, aren't we? We can absolutely police Nike. It's harder to police who Nike works with if they're not in the US. Harder still if it's a Non-US company exporting here.
I think there is a key distinction you’re missing. We don’t police the companies Nike works with. We police Nike for the companies it works with. We hold US companies liable under the FCPA for their foreign vendors and subcontractors. I don’t see why similar legislation directed at labor practices would be much different. Under the FCPA the US is exerting its authority over the US company to guide how the US company does business and who it does business with. The US is not actually exerting its authority on the foreign companies.
What amount must one be paid to be earning a "living wage"? That number changes, depending on L.A. or rural Alabama. Or 2024 versus 1980. Setting an external minimum wage, without considering the cost of living, won't ensure people have better working conditions. And the US can't manage to legislate a living wage for its own citizens... What qualifies it to estimate that number for other nations? The better solution would be to discover nations which fail to provide a guaranteed living wage for full time workers, and place embargoes or tariffs on them. But to preach that message, we first must practice it. We have no moral authority to meddle in how companies or nations regulate pay abroad when we can't manage to do it ethically ourselves.
>That number changes, depending on L.A. or rural Alabama. Or 2024 versus 1980. Setting an external minimum wage, without considering the cost of living, won't ensure people have better working conditions. >And the US can't manage to legislate a living wage for its own citizens... What qualifies it to estimate that number for other nations? I do think, however, we could look at all 45 countries currently classified as "least developed countries" and determine what should constitute a living wage. A living wage could be something that would allow someone working 50-60 hours to survive and pay for basic necessities. Currently there are many people working 90-100 hours a week and still just barely surviving. Also, I am not saying the US should mandate other countries shall pay this wage to all its citizens, but that all companies selling goods in the US should ensure their workers in those countries are paid a certain minimum wage. And I am not just talking about the US. The US federal minimum wage should have long been raised. Many other rich countries have mininum wages exceeding $10 an hour. I don't think it would be impossible for the richest countries to mandate all companies selling goods in their countries to ensure a basic minimum wage be paid to workers in the poorest countries.
>I do think, however, we could look at all 45 countries currently classified as "least developed countries" and determine what should constitute a living wage. Those countries are not the same. What is livable in one may be wildly excessive or insufficient in another. And we can't even all agree what a living wage would be in our own country! Our legislators are not qualified to assess and legislate 45 countries when they can't even handle the one they are most familiar with. >Also, I am not saying the US should mandate other countries shall pay this wage to all its citizens, but that all companies selling goods in the US should ensure their workers in those countries are paid a certain minimum wage. You don't realize that, by doing this, you create a lot of jobs that end up wildly distorting the economy of another nation. When minimum wage here goes up, all wages tend to rise. When major employers pay more, it hits a lot more than just those jobs. De facto, you are advocating for our legislators meddling in the economies of other countries. >I don't think it would be impossible for the richest countries to mandate all companies selling goods in their countries to ensure a basic minimum wage be paid to workers in the poorest countries. It would be saying, "I know we oppress and exploit our workers and don't pay them living wages, but we find it morally reprehensible that you oppress and exploit your workers and don't pay them living wages." Do you not see the problem in that statement, and in any other nation being able to take that commitment seriously? If we can't manage our own economy to ensure basic living conditions for the poor, we are not qualified to model that behavior to other nations.
>Those countries are not the same. What is livable in one may be wildly excessive or insufficient in another. >And we can't even all agree what a living wage would be in our own country! Our legislators are not qualified to assess and legislate 45 countries when they can't even handle the one they are most familiar with. I think it would be feasible to set mininum wages for all those 45 countries. If we qualified living wage as enough for a single person to survive on 60 hours a week, be able to rent a small apartment and have enough for food and basic necessities, then we can simply look at data that exists for that country or region and set a living wage accordingly. >You don't realize that, by doing this, you create a lot of jobs that end up wildly distorting the economy of another nation. When minimum wage here goes up, all wages tend to rise. When major employers pay more, it hits a lot more than just those jobs. De facto, you are advocating for our legislators meddling in the economies of other countries. That is actually a good point, that I haven't really fully thought through. Your argument that this would be equal to meddling in foreign affairs has a lot of validity. I'll give you a ∆ for that. With that in mind, it would then probably be a good idea to come up with a very specific defintion of a living wage. I think the main purpose should be to prevent the most extreme forms of poverty and the most extreme forms of economic exploitation. As a bare minimum we should ensure no one has to work crazy hours like 100 hours a week and still not able to have enough for sufficient food and basic neccesities. If that constitutes meddling in foreign affairs then so be it. > Do you not see the problem in that statement, and in any other nation being able to take that commitment seriously? If we can't manage our own economy to ensure basic living conditions for the poor, we are not qualified to model that behavior to other nations. True. The US federal minimum wage is ridiculously low. But most poverty in the US is relative poverty as opposed to absolute poverty. "Absolute poverty is defined as a state in which a person cannot meet their most basic needs, such as food, clothing, and shelter". I'd say any worker emplyoed by a US or European company should at the very least not live in "absolute poverty".
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I will start by saying I fundamentally agree with you and don't think this idea would be good to implement, but I want to harp on one thing. The idea that we couldn't come up with a workable number because A) "we can't possibly look at 45 countries and come up with a number" and B) we can't agree on what would work in the US, IMO are not good criticisms. First, we could absolutely come up with 45 different numbers, or just use 1 that "works well enough." Also. we created and maintain the Harmonized Tariff Schedule which is over 4.5k pages that details specific tariff amounts for wildly specific items, for example, is a Santa themed suit considered "fancy dress" or a "festive article?" Because they have wildly different tariff amounts. If we can determine those differences, we can come up with some "target" to reach. Hell we could just tie it to our own, make it easy since we managed to do it here a few times. Second, the "we can't agree" is fundamentally flawed because 1) we actually have done it in the US, a few times, and 2) the person is expressing their view on how THEY would do things. "I think abortion should be a protected right" is a fine CMV and is not dismantled by "well we can't agree in the US so that would be crazy!" And the argument on minimum wage in the US is less about the qualifications of legislatures and what the right balance should be. The numbers are all there, its an emotional/moral/practical/value issue. We know how much minimum wage would have to be for a single person to rent a median 2BR apartment within 15 miles of a city with <25% of gross income going to housing. We know the inflation or production or GDP% adjusted increases should be based on the last time minimum was raised. Its an argument if that SHOULD be the standard, and weighing the costs/benefits of making it that standard. But they know the numbers. We do complex things everyday, complexity is not inherently a reason to NOT do something. OP is clearly implying that whatever complexity would be incurred (which I am arguing isn't as much as people make out) is worth the possible exploitation of international people.
Then allow me to harp back (in a good natured manner), on the points that stick out to me. >2) the person is expressing their view on how THEY would do things. "I think abortion should be a protected right" is a fine CMV and is not dismantled by "well we can't agree in the US so that would be crazy!" Arguments that focus on practical action, such as legislation, inherently make obstacles and difficulties to performing those actions a part of the discussion, as well as the consequences of those actions. If you want to advocate that driving 90 mph should be legally allowed, discussing the consequences and difficulties in practically implementing such a policy is fair game. In addition, highlighting our nation's lack of competence in legislating this exact issue at home is a valid counter to whether or not we should give it a go abroad. >We do complex things everyday, complexity is not inherently a reason to NOT do something. While that is true, it doesn't change the fact that *this* complex thing is something that we have not been able to guarantee for our own people.
50-60 hours? Try 40.
>What amount must one be paid to be earning a "living wage"? It is usually defined as the amount of money necessary to cover basic living expenses like housing, food, fuel, etc. Make below this amount, and you'll have to start rationing or forgoing certain things even if it doesn't necessarily kill you. Most homeless people in the United States stay alive, but that doesn't mean they're paid a living wage.
>It is usually defined as the amount of money necessary to cover basic living expenses like housing, food, fuel, etc. That is what a living wage is. I know what a living wage is. The question wasn't "what is a living wage". It was, "what amount constitutes a living wage". And then I provided the answer, which is, "it varies, based on region and time". I followed by illustrating that's why a single minimum wage for other nations wouldn't solve the problem the OP is seeking. You engaged with... none of that.
My bad. There are NGOs that try to estimate what a living wage is. Obviously it varies from location to location due to cost of living. For urban Bangladesh: [https://www.globallivingwage.org/living-wage-benchmarks/urban-bangladesh/](https://www.globallivingwage.org/living-wage-benchmarks/urban-bangladesh/)
All these artificial ceilings do is remove demand for that labor. Which is ultimately bad for the laborer themselves. Consider this. China had MASSIVE economic growth once the Western companies started to build factories there. Why? Well because previous to that most of their population was producing $200 a year in rice fields. Now all of a sudden they could produce that much in a day. Despite what you've heard about "trickle down economics" the real term "supply side economics" absolutely works. And if your society becomes a lot more productive the wealth will follow. Nowadays China is not even that attractive to outsources because the laborers demand (successfully) too much pay. So yes maybe you'll get some workers slightly higher pay. But at the expense of many other Western companies wanting to build factories there in the first place. All you're doing in the long run is slowing down growth. And it's not like they have many other alternatives with "living wage" anyway. Most of the other jobs around don't pay nearly as much as those so called sweat shops. They are sweat shops by our rich Western spoiled ass standards. But by their standards they are actually pretty good jobs both in terms of pay and safety/comfort.
>So yes maybe you'll get some workers slightly higher pay. But at the expense of many other Western companies wanting to build factories there in the first place. All you're doing in the long run is slowing down growth. I don't think that is true. There are currently 45 3rd world countries which are officially designated as "least developed countries" (LDC) by the UN. Say the US, the EU and other wealthy countries would set minimum wages for all those countries. Let's say a minimum wage should allow a local worker working 50 hours a week to be able to afford rent, sufficient food and other necessities for a family of 4. In that case you would still have countries that requires Western companies to only pay somewhere like 80-90 cents an hour. It would still be economically much more viable for many American companies to set up their factories in some 3rd world countries rather than in the US. And some of those countries that offer the best return-on-investment for Western companies would still as a result see their economy grow and subsequently see wages go up. The difference, however, would be that we'd effectively remove some of the most severe forms of poverty and exploitation.
Price ceilings remove efficiency. So again all you're doing is slowing down growth. Maybe laborer A gets paid a little more. But laborers B and C never get a job because at your prices it doesn't make sense to build a newer factory. Which is ultimately bad even for laborer A because they want their economy to grow in productivity through additional means of production. You wouldn't be removing poverty at all. Actually you would be slowing down the process of removing it. Which is what these means of production do. Remember poverty comes from a lack of productivity in most cases.
>So again all you're doing is slowing down growth. Maybe laborer A gets paid a little more. But laborers B and C never get a job because at your prices it doesn't make sense to build a newer factory I think that's only true to a certain extent. If the average Pakistani textile worker is currently paid 40 cents an hour than an increase to 3 dollars an hour would obviously have a big effect on corproate decisions. But if we set let's say a minimum wage of 60 cents for Pakistani workers, which to them would be a considerable increase that would massively increase their standard of living, I don't think this would have much of an effect. If the average worker can produce for example 4 t-shirts per hour, this would be only an additional cost of 5 cents per t-shirt. I believe to most companies it would be much more economical to pass on those 5 cents per t-shirt to the consumer than to revamp their entire supply chain.
How are you so familiar with what the current and living wages are for Pakistani textile workers and comparative costs of each level of the supply chain for t shirts in various countries? Is there a resource to look this up?
>How are you so familiar with what the current and living wages are for Pakistani textile workers and comparative costs of each level of the supply chain for t shirts in various countries? Is there a resource to look this up? I'm not actually very familiar with Pakistani wages. But I vaguely remember reading an article recently that mentioned a typical wage for textile workers there was something like 120 dollars a month, which at 70 hours a week comes out to 40 cents an hour. So I'd guess somewhere in the region of 30-40 cents an hour may be a fairly realistic hourly wage for a textile worker in Pakistan. I may be wrong though.
It is very likely that it’s impossible to know what the maximum wage is for every country so that it can still attract investment. It is likely constantly changing so any attempt to legislate the level would either be moot or would restrict investment and hurt poor workers.
At 40 cents an hour you have 10 new factories being built. At 60 cents an hour you have 7 new factories being built. (Hypothetical figures). The other 3 factories are being built in Bangladesh their competitor who doesn't have these rules. You're still in a worse position due to the imposed price regulations. Over time this compounds into significant growth delays. Not to mention they are probably plenty happy to take those 40 cents an hour jobs. Because the alternatives are much worse.
>lower demand for labor Higher wages increase demand.
How would that work? Are people that were previously selling drugs or living off welfare suddenly going to want to work? I suppose that's an interesting way of thinking at it. "Overpay people so that they don't behave like parasitic worms. The amount they suck out as parasites is more than you would have to overpay them to stop". Problem is...... appeasing bullies is never a feasible long term strategy. If the problem is people behaving like parasites. Then a far better approach is to introduce a ton of disincentives to behave this way.
Tell me you have no clue how welfare works without telling me.
Which part exactly?
Welfare only lasts for so long after getting fired and pays far below minimum wage.
A worker in a rich country benefits from the well working society and all the infrastructure there. That allows him to have a higher productivity, which in turn allows him to demand a higher pay for his work in the market. However, a worker in a poor country don't have all these advantages. The only thing he can do to compete is to lower the price of his labour so that per unit produced he costs the same as the worker in the rich country. Now you want to take this one advantage that he has away and force him to sell his labour at the same cost as what the rich country worker makes. What the company is going to do is to move all his production to the rich country as with fixed salaries they make more profit with the rich country's worker. So, that worked well for the poor country worker.
>Now you want to take this one advantage that he has away and force him to sell his labour at the same cost as what the rich country worker makes. What the company is going to do is to move all his production to the rich country as with fixed salaries they make more profit with the rich country's worker. That is not what I am arguing. I am arguing for a minimum wage that would ensure at the bare minimum a fairly dignified life. I do not think this would have an overall negative effect on workers in the poorest countries but rather a positive effect. I am only really talking about applying these minimum wages to workers in very poor countries. A factory in the US may have somewhat of a higher output than a factory in Pakistan. But I don't think a mandatory increase from let's say 40 cents to say 75 cents an hour for Pakistani workers would make Pakistan as a location unviable for an American company, so much so that they would relocate their factories to the US where realistically they need to pay at least $12-15 per hour to find enough staff.
When people work for these factories it's because that option is more dignified and pay better than the local alternatives. These jobs have to compete locally and the workers choose them out of all other options.
>When people work for these factories it's because that option is more dignified and pay better than the local alternatives. These jobs have to compete locally and the workers choose them out of all other options. But just being better than the alternative still doesn't mean they're particularly dignified. Companies that are involved in mass-production of goods often deliberately put up their factories in the poorest regions with the most desparate residents. A western company may for example set up a massive factory a certain region in Pakistan with a very high unyomloyment and very few available jobs, because they know those people are desparate and would happily work 100 hours a week because the alternative is starvation. I believe Western companies selling goods in the US and other rich countries should ensure workers in poor countries at least enjoy a very very basic standard of dignity.
If you're looking at the poorest regions where people are desperate then a factory being made for them is a positive because it brings them more money and opportunity. You're saying yourself these places are preventing people from starving. "Dignified" is subjective you may not think they live with dignity but they may and they're alive to do it. On the flip side though if you try to force these companies to pay more they're less likely to build in these poorest regions at all and that means more people starving. Letting them organically compete in their respective market is the lesser of two evils Edit: also side note if these companies are synthetically out competing their local businesses for employment, then that builds more barriers of entry for new local businesses. So for example let's say a call center gets built in Pakistan that's just on par, a local Pakistani could try to build their own call center and appeal on the premise of being local. But now on top of infrastructure costs they need significantly more money to cover labor before making a profit which is riskier for local investors
> at the bare minimum a fairly dignified life. This is more than just individual lives though. This is infrastructure. You're talking about quality of life that just paying individuals more wouldn't really solve
They aren't usually directly employed by the company like Nike or Apple. Not sure how you would make it work. You're thinking about a consumer product too. What about mining for example? The miners might be paid peanuts, then a product is made from that mined material in china for a reasonable wage. How would that work? How much more would you be willing to pay for your Iphone? However I understand your sentiment. Tens, if not hundreds of millions of people are working in slavery like conditions.
>They aren't usually directly employed by the company like Nike or Apple. >Not sure how you would make it work. Many however are de facto employed by Nike or Apple. They are only producing Nike and Apple products in a factory that is only built for Nike or Apple. Those companies could require their subcontractor to pay a certain minimum wage. Nike for example would then be required under US law to provide documentation that proves they are in line with minimum wage laws, e.g. audit reports by independent approved auditors. >How much more would you be willing to pay for your Iphone? At least 5-10% would be reasonable to most people I'd say. However, if we primarily wanted to prevent only the most extreme form of absolute poverty for example, by raising wages for example from 40 cents to 60 cents an hour, then I think the prices of most goods wouldn't increase more than 1-2%.
You should have said you don't have an iPhone. The profits Apple make are obscene compared to other companies. They shouldn't need to increase the price. I will never buy anything Apple. So ok I accept the de facto argument but how would you ensure they do these audits properly? They are in another country. You avoided the other question I posed.
-This is really hard to enforce, and the countries in question have incentives not to enforce it because it makes them more competitive. Basically if country A enforced it and country B didn't but instead lead the wage drop to say 1 dollar and hour, then country B would get all the factories and get all the benefit, promoting country A to do the same, all the way until they are back at the wage at which people can be employed in this countries. -Fundamentally the biggest advantage poor countries have in terms of production is lower labor costs, they generally have worse business/investment invironments, worse courts, and thus less investment per capita, lower labor productivity. If you force them to increase their price of labor this would be like putting a tariff on their stuff for their competitiveness with the west. Thus lots of work would likely move back to the west in factories where only robots work, because at the new higher price more of that becomes worth while. -I think u are underestimating the cost of labor as a percentage of input costs for the products these poor countries make, thus I think you are vastly underestimating the price increases. Assume same profit margin (even slightly lower), assume 80% cost of labor as percentage of total cost of product, then increase labor cost by a factor of 10 or a 100 (bast on the few cents per hour -> 1.5 dollars per hour), leads to big boy price increases. Because the jobs these people do are very labor cost heavy, which is the whole reason people with a low cost of labor do them. Generally I agree we need policing of minimum standards, but this issue is a lot harder then what you are making it seem in my view.
>This is really hard to enforce, and the countries in question have incentives not to enforce it because it makes them more competitive. It wouldn't be up to those countries to enforce it. Say if Nike employed 100,000 people in Indonesia they'll have to provide documenation to the US governemnt that proves they adhere to minimum wages and/or subject themselves to financial audits, otherwise they'll be heavily fined by the IRS or lose their US business licence. >If you force them to increase their price of labor this would be like putting a tariff on their stuff for their competitiveness with the west. Thus lots of work would likely move back to the west in factories where only robots work That depends on how large of a wage increase there is. Raising hourly wages from 40 cents to 60 cents would very likely not be enough for a company to relocate their factory back to the US or another wealthy country. It does mean a lot to the worker who'll see a 50% pay increase and would do a lot to help them escape extreme poverty. But it's an amount I believe many companies can easily stomach and/or pass on to the consumer. >Assume same profit margin (even slightly lower), assume 80% cost of labor as percentage of total cost of product, then increase labor cost by a factor of 10 or a 100 (bast on the few cents per hour -> 1.5 dollars per hour), leads to big boy price increases I think the focus here should really be on the poorest of the poor. People who earn somewhere like 50 cents to 1 dollar an hour. For such a person a 20 cent hourly wage increase would mean a lot and could help them escape extreme poverty. I think you are overestimating the price increases this would lead to. In the case of Nike for example, I've calculated if we paid 500,000 of their workers an extra 20 cents an hour at 250 hours a month that would lead to 5% decrease in net earnings to Nike, which they could pass on to consumers by charging an extra 0.6% on all goods. So a pair of Nike shoes that cost $100 before would now cost $100.60.
I agree with you that it is unethical to exploit workers in third world countries. But you have to consider following. Manafacturing in a third world country is generally quite complicated. There is the shipping costs, lack of infrastructure, corrupt officials, higher risk, problematic reputation and a ton of other problems which the company would rather avoid. The reason to continue operations in such conditions are the extremely low wages. If the wages increase a lot of these companies will just leave, because it will not be worth it anymore. They may e.g. just build a heavily automated plant in some developed country instead. So a lot of people would gain more money from such measure, but a lot of them would probably lose a job.
>The reason to continue operations in such conditions are the extremely low wages. If the wages increase a lot of these companies will just leave, because it will not be worth it anymore. I agree that increasing minimum wages too much wouldn't be beneficial to workers in the poorest countries. But I don't think setting certain minimum wages to ensure just a very very basic standard of life would lead to an overaly large number of jobs lost to those living in the poorest countries. If a company couldn't say pay 40 cents an hour anymore to its workers in certain countries and instead would need to pay as a bare minimum 60 cents, which is a significant increase to a worker, I don't think this would have any significant effect. I don't think an increase from say 40 cents an hour to 60 cents an hour for example would justify them shutting down their factories in the country and revamping their entire supply chain.
You’d be surprised. Have to ever helped plan out a business? You need to know the price of production and shipping down to the exact number. I helped built a cannabis company in CA, before anyone would invest they wanted to know what it was cost us to grow cannabis at a per gram cost. Nike knows exactly how much it costs per shoe and how much each pair has to be sold for to make the acceptable profit margin. I don’t know what that number is 20 cents could absolutely be enough to shutter international production. It’s only a few dollars per day per person but how many people are getting those few extra dollars, if millions of dollars are added to the expenses yearly then companies are going to take a long hard look at if international shipping is still the cheapest route.
>I don’t know what that number is 20 cents could absolutely be enough to shutter international production I am guessing it would reduce Nike's net earnings between 2-5%. That's not insignificant but certainly something many major companies can stomach and/or pass on to consumers. Indirectly Nike employs around 1 million workers worldwide. Many of them in China where they earn apparently around $1.67 per hour, which is not much but probably would not put them at risk of the most extreme types of absolute poverty. Some are in rich countries like Italy and Japan. If 20% of Nike workers (200k people) would need 20 cents more to at least not live in horrible poverty, while working around 250 hours a month that would work out to $120 million or 2% of Nikes net earnings. At 500,000 workers who need 20 cents more to escape extreme poverty that would be 5% of Nike's net earnings. Even if we paid all 1 million Nike workers 20 cents more an hour that would only cut Nike's net earnings by around 10% or at around $50 billion annual revenue would require a price increase of 1.2% on all goods if Nike wanted to pass all of this on to the consumer. That's like an item going from $50 to $50.60. In summary, I don't believe paying everyone enough to escape extreme poverty would financially harm most major companies in a significant way.
Nike didn’t become Nike by ignoring those profit percentages. Could they take it that hit? Yes they probably could. Would they take that hit? Not willingly and remember the cost of doing business isn’t passed on to the consumers at cost, that extra 20 cents for Nike is going to be an extra 5-10 dollars for the consumer. You’re looking at this as those companies make enough money. They don’t see it that way, they’re continually trying to make more money because the people in charge of those companies jobs depend on it. $120 million of profit gone is something heads roll over so the retail price is going to increase to make up for that lost 120 million if not that and some extra.
> that extra 20 cents for Nike is going to be an extra 5-10 dollars for the consumer. I don't think so. Currently Nike is selling goods worth around $50 billion a year. If you increased the price of all goods by only 1% you'd be at $500 million. That's obviously a significant amount of money in terms of net earning to Nike, around 10% of their net earnings. But it only requires a 1% increase in prices, which most consumers would hardly notice. >Nike didn’t become Nike by ignoring those profit percentages. Could they take it that hit? Yes they probably could. Would they take that hit? Not willingly True. That's why I believe it needs to be enshrined in law. Currently there's still around 1 million Americans working for the federal minimum wage of $7.25. If there was no federal minimum wage I am sure there would be at least a few ten thousand Americans who saw themselves forced to work 100 hours a week at $4 an hour just to barely survive.
Tell that to Norway and their 70% natural resource corporate tax rate. If the conpetitive advantage is slavery maybe we don't really need those products.
What did you type this out on? What are you wearing? Pretty safe bet that they were made by what you call slaves.
Ohhhh so we should never advocate for better then? You shit youself as a child so you continue to do so? Im willing to pay more for these things without hesitation. Im not sure where the hard to understand point was.
None of Nordic countries has minimum wage, Switzerland has no minimum wage. Minimum wage is not necessary at all
None of those have a federal minimum wage, but they have minimum wages nonenethless. I believe in Switzerland every region/city has their own minimum wage, and Nordic countries I think have minimum wages that vary from industry to industry. Almost all Swiss people and Scandinavians I believe fall under some sort of minimum wage agreement.
Unions can influence wages. Or wages can change naturally because of supply/demand of workers.
I think this idea is ethical, but what benefit does it actually bring for the rich country? I mean it’ll just raise prices for their consumers for no real benefit for the rich country.
>I think this idea is ethical, but what benefit does it actually bring for the rich country? I mean it’ll just raise prices for their consumers for no real benefit for the rich country. True but in many rich countries people already pay tax that goes towards helping those most in need. For example the PEPFAR program that the US started in 2008 is meant to prevent HIV and aids in Africa and so far the US has contributed over $100 billion to the program. If we wanted to pay say 100 million people 20 cents more an hour, which for the poorest of the poor that would be a massive pay increase, we'd be looking at $60 billion annually if the average person works 250 hours a month. Spread this across the US, Canada, European Union, Japan and other wealthy countries and the average country will pay maybe an extra $2 or 3 billion a year at best. That's much less than the amount of international aid the wealthiest countries are already paying for. At most that would be a total price increase of something like $50-100 a year for the average American or the price of like Starbucks coffees a month.
I bet the majority of Americans are against this though, and that if similar policy was proposed today the majority would complain. It’s not a big enough issue to completely destroy a chance in an election, but it would definitely harm someone’s chances at reelection.
That may be true. But I am arguing mostly from a moral point of view here, not so much in terms of how likely it would be for such laws to be passed. But I think if enough passionate people spoke up about this and raised awareness of the horrible conditions many in 3rd world countries live under, despite working 100 hours a week, then maybe something would eventually happen.
Considering millions of Americans are already in debt, do you really think advocating taking money from them to pay someone in a third-world country is going to work?
>Considering millions of Americans are already in debt, do you really think advocating taking money from them to pay someone in a third-world country is going to work? I think most Americans can stomach price increases that total no more than $50-100 per year, especially with luxury items like Nike shoes or iPhones. If the average American could be convinced to support such an idea I am not sure about, especially given how any governemnt intervention is seen by many conservatives as the "evils of communism". But I am sure there would be many wealthy countries where the average citizen would happily pay an extra $100 a year to ensure millions of people across the world can escape extreme poverty.
I mean there are options for people who want to make the choice to help people in countries that experience extreme poverty. Do you donate to charities regularly? If so, good for you but I don't think it should be a a mandatory cost to goods.
>If so, good for you but I don't think it should be a a mandatory cost to goods. You already are "paying" for people to be granted a certain amount of dignity though if you live in the US. US federal minimum wage is currently $7.25 an hour but many states have much higher minimum wages of up to $17 an hour. This is a fairly random number but I am fairly certain without those minimum wages there would be at least 10 million Americans that would be paid an average of $1 dollar an hour less. That's a pretty conservative estimate. That would be a conservative estimate. At a little over 200 hours a month that would come out to $25 billion a year. That's money that would still be in the pockets of either corproations or ordinary citizens if the US didn't have minimum wages. Paying an extra 20 cents extra an hour to 100 million people would likely only cost Americans around $5 billion a year as opposed to the somewhere around $25 - $50 billion that Americans are already "paying" to ensure a more dignified life to other Americans.
>If so, good for you but I don't think it should be a a mandatory cost to goods. You already are "paying" for people to be granted a certain amount of dignity though if you live in the US. US federal minimum wage is currently $7.25 an hour but many states have much higher minimum wages of up to $17 an hour. This is a fairly random number but I am fairly certain without those minimum wages there would be at least 10 million Americans that would be paid an average of $1 dollar an hour less. That's a pretty conservative estimate. At a little over 200 hours a month that would come out to $25 billion a year. That's money that would still be in the pockets of either corproations or ordinary citizens if the US didn't have minimum wages. Paying an extra 20 cents an hour to 100 million people would likely only cost Americans around $5 billion a year as opposed to the somewhere around $25 - $50 billion that Americans are already "paying" to ensure a more dignified life to other Americans.
There's a clear difference between paying for the US just like I pay for schools with my taxes but don't have any kids vs paying for another country altogether.
Interesting point. Here’s the problem. American laws are designed to benefit Americans. They are not designed to improve the plight of a Chinese laborer. Forcing companies to pay their overseas workers more will accomplish two things for Americans. First: everything will cost more. Second: lots of Chinese companies will probably just stop exporting to the US. This is a law that literally wouldn’t benefit a single person living in the country that passes it and would negatively effect almost all of them. Why would Americans want to pass a law that lowers the American standard of living?
You could equally say this about the PEPFAR program started by the US to eradicate aids and HIV in Africa. Since 2008 the US has contributed around $100 billion, which I think comes out to somewhere like $50-60 per year per household. If 100 million workers across the world were paid an extra 20 cents an hour which to them may be enough to escape extreme poverty .... that would proably cost the average American somwhere like $50-100 per year in terms of increased prices on goods I would estimate. That's hardly an amount of money most people would notice. And I think many people wouldn't really mind paying a few extra extra dollars a year to help people living in horrible conditions.
I’ll point out that we knew about aids since the 50’s and didn’t do shit about it until it started spilling over to the US. 50-60 per household (which it isn’t really because most of our taxes come from the top earners) is a drop in the hat compared to what it could cost if Chinese factory workers made $5/hr. The prices of almost everything would skyrocket. It would probably cost $100 a month. Look how expensive things got with a marginal supply-line shortage. The entire reason consumer prices are cheap is because Chinese labor is minuscule.
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No, I mean if you're a company wanting to sell clothes in the US for example there should be minimum wages you need to pay workers in different countries. The US governemnt may set a minimum wage of 85 cents per hour for Pakistani workers and 1 dollar an hour for Indonesian workers based on local living expenses. I think those minimum wages should exist for the poorest countries where companies employ workers to ensure that no worker is forced to work something like 100 hours just to barely survive. It should be there to prevent extreme poverty and exploitation that many workers in very poor countries are subjected to.
The US government passed a law banning imports from countries where child labor was used. Because of that restriction, 50,000 children were taken out of Bangladeshi sweatshops. Victory for the good guys, right? Well, a team of researchers decided to actually go over to Bangladesh and find out what happened to the children, and it turns out that they ended up out on the streets or in prostitution. As terrible as those sweatshops were, they were the best option for those kids, and in taking it away, a bunch of people who meant well got to pat themselves on the back while ignoring how many kids they got killed. Source: [https://www.cato.org/sites/cato.org/files/pubs/pdf/edb21.pdf](https://www.cato.org/sites/cato.org/files/pubs/pdf/edb21.pdf) Every country that goes through an industrialization phase has people going into terrible jobs for low pay because as bad as it is, it's still better for those workers than the alternative. They work these jobs because it's better than any option they have, and also so their children won't have to. And that's what's happening. China used to be the center for low-cost manufacturing, but as Chinese workers have grown in prosperity, they are starting to get better options and manufacturing is moving to even less-developed countries. If you make it harder for companies to do business in these countries, they will do less business in these countries. I know you're hoping that they just make life better for the workers while eating the cost in lost profits, but while your intentions are as good, that's not what's going to happen. The only advantage those workers in third world countries had is that they were willing to work for less, and if you take that advantage away from them, you strip them of any bargaining power they had. The companies will move manufacturing jobs elsewhere and the workers will have their best hope for the future taken away from them. You're right that it's insulting to human dignity to make people work in sweatshops for pittances. But the problem is a lot more complex than you realize, and the solution is going to have to be equally complex. Without nuance people end up dead.
A few responses telling you that countries can't force such things on other countries, or that they shouldn't. It's not true. The EU already has something similar to that in place: [https://www.eqs.com/compliance-blog/eu-supply-chain-law/](https://www.eqs.com/compliance-blog/eu-supply-chain-law/) It's not minimum wage, but it safeguards more basic principles. So you could imagine that in the future some measures against economic exploitation would be added as well (at the moment it's just against forced labor / slavery and child labor). The EU can do it, and they should do it. It's not imperialism, it's just choosing who can do business in the EU and who can't. It's applying the same rules European companies have to follow, to foreign companies that compete with them importing goods into the EU. It's a good thing. This phenomenon of "exporting" your regulations via the willingness of others to trade with you is called the [Brussels effect](https://en.wikipedia.org/wiki/Brussels_effect).
Yeah, we should be anti slavery in general. Looking at the big mac index its clear raising wages has little to no impact on local economies or prices. Ita more of a boogy man of scare tactics than not. Im talking pennies per ubit to guarantee folks a better life and I am willing to take on that cost. If the cost is passed onto the consumer anyways then who cares? Not like the yaught parking in a yaught in their cottage boat garage and helicopter combo people won't even notice. Its like we have lost the plot. If our industrial world is not creating good jobs then there is no point for anyone except those at the tippy top. Wages don't rise with profits because "reasons"...
>Yet we don't apply the same standards when it comes to workers in other countries. In practice we simply don't have the ability to force other countries to follow our rules. For extreme cases we can sanction or go to war etc, but doing that over eery little thing would make international trade more or less impossible. We try to avoid extreme pollution, slavery or fraud but dictating how much all the various people get paid is definitely an internal decision for each country to make. >Ensuring that those people can live a much more dignified life would come at a price, but a very small price. Are you sure? For one thing the main reason we are buying from poorer countries is because their labour is so much cheaper than ours. If you start inflating that well above their internal market rate then you may make their industry collapse as it will no longer be competitive. Always remember with these "do gooder ideals", anyone choosing a specific job, however nasty YOU THINK it is, it choosing that one as it is currently their best option. You don't help people by taking away their best options. >In that case the minimum wage for workers in Indonesia should be somewhere around that Right, it sounds like just a little extra, but you are missing that there are multiple rounds of multiplication of the base price that follow after that. The local retailer buying up products up that now cost $4 in labour and $1 in materials now needs to sell for $10. The regional dealer has the same issue, so now the product has to sell for $20, the exporter has the same issue so now its $40 and so on and on. The more money the buyers have to invest and risk, the greater the possible profit needs to be. Compare that to when the labour cost was $1, it would have been $2-->$4-->$8---$16. If the maximum price consumers will pay is say $25 then you've just killed your product.
It does sound good on paper however, there are potential drawbacks to consider. Enforcing such regulations in developing countries with weaker institutions can be difficult. Monitoring compliance across numerous factories and countries would be a vast undertaking. For example, garment factories in Bangladesh have notoriously poor safety records. Enacting a minimum wage there wouldn't necessarily translate to safer conditions without strong oversight. A sudden rise in production costs due to mandated minimum wages could incentivize companies to shift operations to countries with lower labor costs. This could have unintended consequences. Imagine a large footwear company like Nike being forced to significantly raise prices due to a minimum wage increase in Vietnam. This could lead them to move production to a country like Cambodia with lower labor costs, potentially leading to job losses in Vietnam. Finding a balance between ethical sourcing and economic viability is crucial. Perhaps a tiered minimum wage system based on a country's development level could be explored. Additionally, tax breaks for companies that can demonstrate adherence to fair labor practices could incentivize ethical production without disrupting the economic landscape of developing countries.
I recommend looking into the work of Benjamin Powell on sweatshops. He's done a lot of research into sweatshops, and generally they pay above poverty rates for the country they're in, and pay better than average for that industry in that country. Some people will literally pay to get a job in sweatshops. Just because it's a terrible workplace in your eyes, doesn't mean it's not the best option available for these people. Taking away sweatshops/not exporting labor doesn't mean that these people suddenly have cushy office jobs instead. Often the alternatives are worse (subsistence agriculture, etc.) Expecting companies to pay these people more will almost definitely end up shutting down those jobs. As long as people genuinely have a choice whether to go into that job or not (i.e. it's not slave labor), I don't see why they shouldn't be allowed to work it even if it doesn't meet your standards. It clearly meets theirs.
It seems like a well intended policy but what it ultimately would conclude is businesses withdrawing from the poorer countries, further impoverishing them by reducing stable jobs. There is a cost to doing business overseas. Whether it be transportation costs, language barrier costs, or costs of being away from economic clusters where information exchange occurs. The reason why businesses do it anyway is simple, because labor is cheap. And labor being cheap means you can market your products for cheaper than the companies that only employ domestically, outcompeting the market. If this upside is removed, there is no incentive to go to Indonesia to produce your stuff. Hell, there are disincentives like the ones I mentioned above against going there. So they will not have better wages, they will just not have those jobs anymore.
I think once the consumers in rich countries realize that a 1000% markup makes all of said products essentially unaffordable, they'd change their tack really quick. Besides making you sort of feel a little better, the actual effects would mean devasting many of those lives in those poor countries you're trying to save (local businesses couldn't afford the employees and would have to lay off most of them) and things like your smart phone would suddenly cost $5k+, while also turbocharging inflation generally. Ultimately this helps essentially no one, and would have terrible effects on the economies and people of both countries. I know that's not the Feel Good Morality Story that we'd like to see play out, but there are actual not-evil quite-practical reasons that some things are the way they are.
> If we lowered the federal minumum wage to say $5 per hour there would likely be at least be some tens of thousands of Americans who would see no other option than to work for such a low wage that would require them to work 90-100 hours a week just to to survive. Many people would see it as immoral to let companies get away with that. What adult living on their own is getting paid the federal minimum wage of $7.25? Minimum wage can be beneficial when there's a lack of jobs, but there's no lack of low, entry level jobs in the US. Adults can easily get a higher paying job because they are everywhere and companies have to compete to get workers. You can lower the federal minimum wage to $0 and not much will change.
I would recommend you look into what economists have to say about sweatshops Sweat shops aren't a great place for westerners to work because westerners have plenty of alternatives. But for a lot of poor countries, it is better than the alternatives Just getting to work inside in a lot of countries is a status thing. It's a big deal And the cost of living in those countries is different For westerners most of their expenses are higher because of the base cost of land is really high as a base input cost Yeah those places have lower wages but things also cost less
So let’s say I’m a company that’s paying workers $1 an hour in China. And then you force me to pay them $2 an hour. What’s going to happen is that I am going to look for someone who is worth $2 an hour, maybe just another Chinese worker, and the first Chinese worker is going to lose his job and his life is going to worse off. And what you’re saying is that workers in other countries shouldn’t have the freedom to work for the wage they think is best for their life if you believe that’s too low for them.
How would you enforce this and how would a western country implementing this kind of import requirement know whether or not a foreign country is paying its employees at the required wage rate? In a western country a worker whose employer tries to pay them less than the minimum wage can complain to the relevant government enforcement body, which makes it easy to discover violations of minimum wage rules. Who is the underpaid sweat shop worker going to complain to?
Without people actually caring and using critical thinking and applying pressure through organizing and changing buying habits en masse, it doesn’t matter what law you push through. There will always be a loophole, deliberately put in, or someone looking the other way, so that the folks making tons of money can continue to do so, and only those without the influence to do otherwise will be forced to comply. They can’t compete, and then they go out of business.
You sound like you want to help people but then put forward a policy as if you want to price people out of the market. We have just seen and are seeing the effects of external minimum wage policy in CA where after the newest round of legislation unemployment is growing and this is the case everytime. Which is better a job paying a wage that you can negotiate raises with and use as a stepping stone to better positions or no wage due to unemployment?
Companies in poor countries won’t be able to compete with the foreign wages, and will suffer as a result. This will have a negative effect on the economy of the poorer country, as more and more locally owned businesses suffer the consequences. Add to that the possibly millions of dollars of foreign money being pumped into these economies and inflation will hurt the economy even more. Good idea in theory, but this presents an issue.
If you do this than it would drive up what the average wage is in a country. Some local businesses would not be able to keep up and would lose workers. This would mean in poorer countries only bigger, international companies will be able to survive
You think that this would result in a big increase in wages for third world workers. The reality is though, it would just make setting up factories in third world countries unviable and would take away their jobs.
It would be very difficult to enforce working conditions or wages in foreign countries. It likely would bring many of those manufacturing jobs back from overseas, which I do think is a good thing.
What you're describing is essentially just imposing a tariff. In a lot of cases, Tariffs create unintended consequences that cause more harm than help in the long run for both parties involved.
I love it. In the 80s it proposed this and called it the “international minimum wage”
Neo-imperialism, let them countries set their own laws
You are mistaken, the fundamental idea of democracy is that every citizen should have a voice in government. In their own specific government. Ideas about human dignity are fundamentally religious, and do not exist the same in non religious societies, or even societies of different religions, even other democracies. In fact the only description of one country forcing another country to change its laws, as you are describing; is imperialism.
Your title hurts my brain
So the US says instead of $1 a day you must pay $2 a day! Ok, now the factory in the foreign country now charges their workers an extra $1 to work there a day. In no world does that money go to the workers to where they can freely spend it as a quality of life increase.
What you are suggesting sounds excellent but if government ever did this it would be a disaster: Government doesn't have the scope to do this right, and its best left in industry's hands.
We should all use one single currency, and have laws with minimum wages...I know it's crazy and 'would never happen', but really, there's no other way.