I went to last night’s Senate meeting, but I had to leave before the they got to to the sweatshop and Russell Athletics resolutions. (Hey, Senate, it would be great if you could spend less than an hour flapping your jaws about every single point on the agenda. Just a thought.) From my extensive Twitter analysis, it appears both of the resolutions failed.
Anyway, Vincent’s post below pretty much nails it, but I’d like to add this 2004 article in Reason, which cites a study by the National Bureau of Economic Research.
[W]hen economists looked at reams of economic data on wages and workers’ rights in developing countries, they found that multinationals generally paid more — often a lot more — than the wages offered by locally owned companies. The study cites evidence that affiliates of U.S. multinationals “pay a wage premium that ranges from 40 percent in high-income countries to 100 percent, or double the local average wage, in low-income countries.”
Vietnamese workers in foreign-owned apparel and footwear factories rank in the top 20 percent of the population by household expenditure. Indonesian workers in Nike subcontractor factories earned $670 per year, compared to the average minimum wage of $134. In Mexico firms that exported more than 80 percent of their output paid wages that were 58 percent to 67 percent higher than wages paid by domestic firms.
If Russell is truly acting in an illegal and unethical way, then the university should not renew its contract with the company. However, a broad, “anti-sweatshop” resolution would be (a) less effective and (b) naive and somewhat ignorant given the great benefits of foreign direct investment in third-world countries.
Also, Alex “Tomcat” Scott has a good post over on the ODE news blog with many links for and against Russel.