China’s ‘Competitive Advantage’: Serfdom

January 26, 2012 - AFL-CIO NOW! Blog - By Tula Connell

A much-discussed report in the Sunday New York Times on why iPhones are made in China highlights the transition of Apple guru Steve Jobs who, a few years after Apple began building the Macintosh in 1983, bragged it was “a machine that is made in America.” Today, millions of Apple products like iPhones, iPads and Kindles are made in China sweatshops like Foxconn.

So what happened?

In a nutshell, this:

Apple had redesigned the iPhone’s screen at the last minute, forcing an assembly line overhaul [at a Chinese factory]. New screens began arriving at the plant near midnight.

A foreman immediately roused 8,000 workers inside the company’s dormitories, according to the executive. Each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames. Within 96 hours, the plant was producing over 10,000 iPhones a day.

“The speed and flexibility is breathtaking,” the executive said. “There’s no American plant that can match that.”

China’s use of near-slave labor conditions creates its “competitive edge.” But its advantage is not so much due to lower wages as to speed and turnover—an on-demand supply of workers who are housed little better than assembly parts, stacked in multiple dorm beds per room with no chance to escape.

Yet the New York Times repeats the mantra that corporations don’t create such jobs in the United States because of a “skills shortage.” Economist Clyde Prestowitz takes apart this tired refrain:

The Apple argument is that the U.S. schools and education system are not turning out the kinds of workers with the kinds of skills we need. So, we have no choice but to go overseas. But the truth is more nearly the opposite. It’s because the companies are moving the jobs overseas that no Americans are learning the necessary skills. This is true for two reasons. One is that Americans are generally not stupid and recognize that because of off-shoring there won’t be any of those kinds of jobs and thus there is no sense in learning the skills necessary to do them. The second is that most of this kind of job or skill training occurs on the job, and if there are no jobs then there will be no skills.

Prestowitz applauds President Obama for asserting in his State of the Union address Tuesday night that a U.S. “economy built to last” must have a robust manufacturing base and that corporate tax incentives to offshore jobs must be reversed.

But as AFL-CIO President Richard Trumka notes, Obama alone can’t turn around this nation’s economy and create good jobs.

Now it’s time for Congress to stop standing in the way of rebuilding our country and act.