Americans want to help Haiti; Democrats control the US Congress; the Haitian Parliament has passed legislation saying Haitian workers should be paid at least $5 a day; and specific legislation that provides preferential access to the US market to garments from Haiti is already US law. Therefore, the following policy reform ought to be a slam dunk: Haitian garment workers whose products receive preferential access to the US market under the HOPE II Act ought to be paid at least $5 a day.
The international community is dusting off a plan to expand Haiti’s low-wage garment assembly industry as a linchpin of recovery, The AP reported. The Obama administration is on board, encouraging US retailers to obtain from Haiti at least one percent of the clothes they sell. Garments are central to an economic growth plan commissioned by the UN and promoted by former President Clinton, the UN’s special envoy for Haiti.
In 2008, Congress passed the “HOPE II” Act, which lets Haiti export textiles duty-free to the US for a decade.
Currently, the minimum wage in Haiti for garment workers who produce for the US consumer market is $3.09 a day. Last year, the Haitian Parliament passed legislation to raise the minimum wage for all workers from $1.72 a day to $5 a day. But factory owners in the export sector producing for the US consumer market complained to Haitian President Preval, and he refused to implement the law. A compromise was reached: the minimum wage is now $5, except for the garment workers; they get $3.09 a day.
The AP gave the example of Jordanie Pinquie Rebeca, a garment worker:
Rebeca … guides a piece of suit-jacket wool and its silky lining into a sewing machine … If she does this for eight hours, she will earn $3.09. Her boss will ship the pinstriped suit she helped make to the United States, tariff-free. There a shopper will buy it from JoS. A. Bank Clothiers for $550.
The AP said that even the factory owners concede that garment-industry wages are too low to feed, clothe and house workers and their families.
As for Rebeca:
Rebeca … sleeps on the street and barely eats. With a day’s pay she can buy a cupful of rice and transport via group taxi, and pay down debt on her now-destroyed apartment. Anything left over goes to cell phone minutes to call her boyfriend, who was evacuated to the Dominican Republic with a leg fracture sustained in the quake, or her 4-year-old son, Mike, whom she sent to live with relatives in the countryside.
Should a worker in Haiti whose job is supported by US consumer demand, whose product has preferential access to the US consumer market, be forced to live like this?
The US Congress could raise Rebeca’s daily wage from $3.09 to $5 – a 60 percent increase – simply by enacting into US law the benchmark established by the Haitian Parliament. Indeed, it is likely that if Democrats in Congress merely signaled their willingness to enact this benchmark into law, Haitian Parliamentarians could do the rest. They could go to President Preval and say: “Look, the Americans want this.” And President Preval would have to listen.
Suppose that it takes Rebeca a day to produce that suit, an assumption that the AP article seems to imply is plausible. Is it too much to ask that she get an extra $2 for making a $550 suit? If we could ask the customer in the US who purchased the suit for $550 for a $2 donation so Rebeca could have something to eat, how many people would say no?
Following the earthquake, the US granted Temporary Protected Status to Haitians in the US. One of the arguments in favor of doing this was that remittances from Haitian workers in the US support people in Haiti, and this support was even more needed now in the wake of the earthquake. Doesn’t this logic also apply to increasing the wages of workers in Haiti supplying the US consumer market? Wouldn’t this be a straightforward way to get US dollars into deserving hands close to the ground?
We have a principle in the US – not always honored in practice – that if you work full-time, you ought to be able to feed and clothe yourself and put a roof over your head. This principle ought to apply to workers in Haiti who produce for the US consumer market.
This is a policy that labor, aid and Haiti solidarity groups should be able to unite on. Labor wants to raise labor standards. Aid groups want trade to support development. These are two great tastes that would taste great together.
Establishing this policy would set a good precedent. US-supported international institutions such as the International Monetary Fund (IMF) and the World Bank have long used their influence to obstruct government efforts to raise wages in countries like Haiti. But the IMF has recently reversed itself on other long-held dogmas – embracing capital controls and moderate inflation in developing countries, for example. If the IMF can rethink capital controls and moderate inflation, maybe it can rethink starvation wages.