Apple Driving Workers to Threaten Mass Suicide?

The Pathologies of the Modern Corporation
By Robert Cruickshank, AlterNet
January 26, 2012

Here in my household, we are swimming in Apple products. We have four iPhones, although only three of them are currently in use. We have an iPod and an iPad. We have a MacBook and a MacBook Air (on which this post is currently being composed). We have two iBooks in storage, along with my iMac, which dates to the summer of 2000. It still boots up and works just fine.

I’m not an Apple fanboy. I just prefer products that work well, rarely ever crash, and help me create value. Apple products meet those needs perfectly, whereas most PCs I’ve used simply don't.

If those were the only things I cared about in life, I wouldn’t give those products a second thought. But there’s more to life than a functional piece of consumer electronics. Those items should exist to help me do the things in life that I want to do, to help me live a better life. They’re tools, not ends.

Even that’s not sufficient. One of my main goals in life is to build a better world, to ease suffering, end oppression, and provide equality – all in order that others may have the freedom to pursue their own dreams. A well-designed product can certainly help that process along. But what if the way that product is made actually undermines those broader goals? Suddenly, there’s a problem.

In the last year or two, it’s become increasingly clear that the way Apple makes its products is deeply flawed. Working conditions at the factory which makes most of their products – Foxconn in Shenzhen, China – are so appalling that workers engaged in a rash of suicides in 2010 to ameliorate their own suffering. Earlier this year workers threatened mass suicide over pay and working conditions. And of course, there’s the fact that Apple makes these products overseas rather than in the United States, where unemployment remains at some of the highest levels we’ve seen since the Great Depression.

Here in the 21st century, it should be clear to us that better technology is not sufficient to build the kind of better lives and society that we want. If it were, we wouldn’t be in a position of mass unemployment, widespread suffering, and a democracy in decay. Social institutions, including workplaces and corporations, have to be full partners in building a democratic, empowered, and equal society.

Most corporations, however, don’t see themselves that way – including Apple. Today’s New York Times took a look at Apple, America And A Squeezed Middle Class, curious to see why Apple no longer manufactures its products in the US and what the impact is on our prosperity. They found that Apple builds in China in large part because they have a narrow focus on their products and their profits, and disdain wider concerns for the good of society. When an unnamed Apple executive was asked about their role in addressing America’s economic problems, their response was revealing:

They say Apple’s success has benefited the economy by empowering entrepreneurs and creating jobs at companies like cellular providers and businesses shipping Apple products. And, ultimately, they say curing unemployment is not their job. 

“We sell iPhones in over a hundred countries,” a current Apple executive said. “We don’t have an obligation to solve America’s problems. Our only obligation is making the best product possible.”

That quote is perhaps the best encapsulation of the pathologies of the modern American corporation. In fact, Apple does have an obligation to solve America’s problems. Everyone who lives in this country has that obligation. And corporations have that obligation too. If they don’t want to help make things better, then they shouldn’t exist.

The notion that companies exist only to generate profit or build a specific few set of products is corrosive. Those profits and products serve the rest of society. And as a part of that society, companies and their executives exist to make that society a better place. If they are engaged in a set of practices that make society worse off, then those actions are indefensible and need to be changed.

For the last 30 years, American businesses have been devoted to a single-minded pursuit of maximizing short-term profits. Unsurprisingly, this has had profound ripple effects throughout the rest of society. The economy became focused on those profits, and so with it followed politics, culture, and our values as a civilization.

By now it should be clear to everybody that while this works well for the small elite that has hoarded all these profits – the so-called “1%” – it has utterly failed to provide a happy and fulfilled life for everyone else.

This is true not only of the American workers who have lost their jobs due to outsourcing, it’s true of the workers around the world who have those jobs now. Those workers aren’t villains – if anything they’re even worse off. Foxconn’s chairman not only compared his workforce to animals, he suggested he might learn good management techniques from a Taiwanese zoo.

The NYT article talks about one of the reasons Apple likes Foxconn is because the factory is willing to push its workers not just to the breaking point, but well beyond it, in service to Apple’s profits and product demands. The NYT article described Steve Jobs’ 2007 rant about the iPhone needing an unscratchable glass surface within six weeks, and how Foxconn went about fulfilling that need:

In mid-2007, after a month of experimentation, Apple’s engineers finally perfected a method for cutting strengthened glass so it could be used in the iPhone’s screen. The first truckloads of cut glass arrived at Foxconn City in the dead of night, according to the former Apple executive. That’s when managers woke thousands of workers, who crawled into their uniforms — white and black shirts for men, red for women — and quickly lined up to assemble, by hand, the phones. Within three months, Apple had sold one million iPhones. Since then, Foxconn has assembled over 200 million more.

Was that necessary? Certainly not. That might not sound as bad as other reported abuses, but the situation is likely much worse at Apple’s suppliers, with overwork and other forms of employment fraud being rampant. 

As William K. Black explains at Alternet, this is a good example of what may be a widespread tolerance for fraud in the global economy:

These frauds take place abroad, but they harm employees at home. Mitt Romney explains that Bain had to slash wages and pensions to save firms located in the U.S. who had to meet competition from foreign anti-employee control frauds. The damage from foreign anti-employee control frauds drives the domestic attack on U.S. manufacturing wages. Bad ethics increasingly drive good ethics out of the markets and manufacturing jobs out of the U.S. and into more fraud-friendly nations.

One only needs to look at the widespread fraud that underlay the housing bubble of the ’00s to see further evidence for these claims.

Apple likes to think of itself as a model corporation. But as we saw above, their attitude is the same as that of many other businesses – that only the product and the profits matter, with all other elements of human life and social good being unimportant. The NYT article implicitly endorses this view by framing Apple’s decisions as being driven by the marketplace:

It is hard to estimate how much more it would cost to build iPhones in the United States. However, various academics and manufacturing analysts estimate that because labor is such a small part of technology manufacturing, paying American wages would add up to $65 to each iPhone’s expense. Since Apple’s profits are often hundreds of dollars per phone, building domestically, in theory, would still give the company a healthy reward.

In fact, the article explains that Apple is the world’s most profitable company, so clearly there is room to give. I would personally pay $65 more per iPhone if I knew it was going to American workers. I’m an internationalist, and so I’m also willing to pay more if I knew it was going to create better pay and better working conditions for the Foxconn workers in Shenzhen.

The NYT suggests that it’s not just profit motive that drives Apple’s unwillingness to bring jobs back to the States, but the lack of a skilled workforce and existing factory capacity:

But such calculations are, in many respects, meaningless because building the iPhone in the United States would demand much more than hiring Americans — it would require transforming the national and global economies. Apple executives believe there simply aren’t enough American workers with the skills the company needs or factories with sufficient speed and flexibility. Other companies that work with Apple, like Corning, also say they must go abroad.

The NYT treats this as a kind of historic accident, a consequence of the marketplace. But it is in fact the product of 30 years of deliberate American government policy to deskill our workforce and send their jobs overseas so that the top 1% of our society can enjoy greater profits.

Nowhere in the article is the notion of an “industrial policy” described. China spends vast sums of money to develop, promote and protect its manufacturing sector. The United States has not only done no such thing, at least not since 1980, but has instead spent its money and used its laws and policies to encourage the deindustrialization of this country. This is not a market failure but a deliberate outcome of specific political choices.

There is nothing stopping the United States from shifting our current industrial policy away from “doing everything we can to help the 1% get richer” and toward “doing everything we can to promote the development of a manufacturing sector that employs a lot of people, paying good wages with good working conditions.” Well, nothing except the political power of the 1% – and the hegemony of neoliberal ideology, which holds that “the market” should decide who wins and who loses in life, rather than all of us collectively deciding that there’s no reason anyone should ever have to “lose” at all.

The United States could and should spend money to provide job training to help create a workforce that can build the products that make a 21st century society go. We can and should spend money to help make it easier to build sustainable, environmentally responsible factories. We can and should pass laws to ensure those factories are run by a democratic workforce, ideally by a cooperative, rather than by a large corporation focused on profits rather than the social good.

If companies are complaining about costs, we can help solve that problem without letting them fall back on the extremely damaging “solution” of simply cutting their workers’ pay, benefits, or even their jobs. Universal health care, funded through taxation, would mean a company like Apple would not have to include that cost in deciding when and where to hire. The same holds true of universal defined-benefit pensions – an augmented version of Social Security – as well as better schools and a freight and passenger transportation infrastructure that was not dependent on expensive oil.

Those things would not necessarily have to benefit just large corporations. They could provide the basis for people to innovate for themselves, for cooperatives to start setting up shop in the US and begin to design and build things like smartphones.

Changes to the way our companies operate, including eliminating the laws requiring them to maximize shareholder value and instead focus on operating in a way that makes society better, are also key pieces of building a better 21st century prosperity.

If all we want out of life is an iPhone, then we can just continue on the present path. But for those of us who know we can and should aspire to much more fulfilling things, it’s time we started figuring out how to change the global economy, rather than let it continue undermining our values and our lives.