An article in today's New York Times about workers sickened by n-hexane -- a potent neurotoxin used in Chinese manufacturing plants that produce iPhone components for Apple -- underscores the questions raised in my piece called "A Great Leap Backward" posted yesterday on The Pump Handle.
Seeking to lower production costs and boost per dollar productivity, U.S. companies have routinely sought locations with lower wages and less stringent environmental and occupational health and safety regulations. This has been true for some time, but now House Republicans are pushing to rollback standards ostensibly to make us more competitive with China. As we listen to these arguments, it's worth considering what environmental and working conditions in China actually are.
During the weeks of February 7 and 14 -- in the run-up to the February 19 vote on the FY2011 budget bill -- the House Education and Workforce, Energy and Commerce, Judiciary, Oversight, and Rules Committees held hearings to examine how environmental and workplace safety regulations impact job creation.
While watching these hearings, I've thought about what I've learned about and seen of the working and environmental conditions in places that are now the hub of world manufacturing. I've been picturing the smog that hangs over Chinese cities. I've been thinking about the fatal despair of young high-tech workers at Foxconn and Samsung factories in China and South Korea, about the depressed wages and severe working conditions at factories in the Philippines, and about the electronics workers I met in Indonesia this past fall who overflowed with questions about the health effects of their working conditions.
The House Republicans' premise is that the regulations created to implement current United States environmental and occupational health standards are costly impediments to job and business growth, and prevent the U.S. from fully competing as a manufacturing power in the global economy. These regulations, say Republican House members and witnesses representing business associations and manufacturing companies, have caused the U.S. to lose jobs to foreign countries, particularly to developing Asian nations, like China. Without such regulatory obligations, these speakers imply, domestic manufacturing could be booming.
Michael Friedrich, president of a Wisconsin company called MCM Composites, gave this assessment in testimony before the Oversight Committee on February 10th:
We cannot compete on labor costs... The total cost of production labor (hourly wage plus health care, payroll taxes, unemployment compensation, etc) in China, India, East Asia, and Mexico is only a fraction of the cost in the US. What costs $30 per hour to produce in the U.S. costs $15 per hour in East Asia and $5.00 in Mexico. The only way we can compete - and we can compete - in the world economy is through higher productivity coupled with lower overhead burden. The current burden includes the compliance costs of federal regulations, and with the threat of additional burden the U.S. is moving entirely in the wrong direction.
By contrast, Democratic members and witnesses from academic institutions, NGOs and some businesses maintain that government regulations that safeguard occupational, environmental, and public health result in net benefits (including financial benefits) that outweigh any upfront financial costs of implementation. (See University of Maryland law professor Rena Steinzor's testimony before the House Energy & Commerce Committee's Subcommittee on Environment and Economics.) They also maintain that these regulations and the standards they implement can produce and preserve jobs -- and are essential to basic public safety. "I defy you not to think about regulations the next time you get on a commuter airline or the next time you drink tap water in Chicago. Think about it in the morning when you have your eggs," said Representative Mike Quigley (D-IL) during a February 10th House Oversight and Government Reform Committee hearing.
The House Republicans' goal appears to be the removal of what they consider regulatory obstacles to industrial productivity -- the legally enforceable occupational and environmental safety standards designed to protect workers and the public from adverse health effects of industrial processes. Regulation by the Environmental Protection Agency to enforce air-quality standards and by the Occupational Safety and Health Administration to address workplace noise are among their targets.
Here's some recent news from China to bear in mind when considering what life is like in the absence of rigorous environmental and occupational safety standards two generations after The Great Leap Forward -- China's rapid industrialization campaign (led by Mao Zedong starting in the late 1950s) that did begin to transform the country from a rural agrarian to urban industrial society but at devastating human cost:
Thanks to implementation of the Clean Air Act and Occupational Safety and Health Act in 1970, hundreds of thousands of premature pollution-related deaths and thousands of work-related fatalities have been avoided. So the question policy-makers need to be asking as they consider the current attack on environmental, health and safety regulations is do we want to make a great leap backward?
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