Manufacture This

The blog of the Alliance for American Manufacturing

The company's history showcases what could go wrong with trade.

President Obama will visit Nike headquarters on Friday to promote trade, though the visit may also highlight everything that can go wrong with negligent trade policy.

Despite his efforts to fast track his trade agenda through Congress, this recent development leaves many wondering if perhaps the president is attempting to warn Americans of the economic disaster inherent in weak trade enforcement. The strangely prescient visit to Nike headquarters may foretell of future outsourcing and inequality.

Perhaps no company better represents the pitfalls of inadequate trade deals more than Nike.

In the 1990s, the apparel manufacturer was the subject of a series of scandals involving sweatshops, child labor and unsafe working conditions. Subsequently, Nike has embarked on a campaign to fix its image, not its labor standards.

Its superficial efforts to reform its unethical and exploitative production methods are as hollow as the trade enforcement provisions in previous trade deals. Both provide only a thin veneer, an attempt to manipulate opinion and feign efforts at equality and fairness while actively benefitting from abusive practices.

The Nike model is the inevitable result of trade deals which incentivize circumventing labor standards and human rights at the expense of American workers. The United States, as a bastion of individual rights and democracy, should not reward violations of internationally accepted labor standards.

According to a White House statement, the president will use the visit to discuss the ways that free trade benefits American workers, part of his efforts to campaign for fast track. The chosen location for this sales pitch, Nike’s headquarters in Oregon, seems odd — considering most of Nike’s 48,000 direct employees are employed outside of the United States. 

As National Journal noted earlier this week, the only things Nike manufactures in the United States are “Air Sole” cushion components and some small amounts of plastic products (which don’t even make it into Nike shoes — those are sold to other manufacturers).

So how does Nike actually manufacture its pricey shoes? The company employs roughly 1 million subcontracted workers at overseas factories, mostly in Asian countries such as Vietnam, China, and Indonesia — and the benefits that the workers have experienced are questionable.

Numerous Nike products have been produced by children as young as 10, according to the company’s own admission. In Nike’s factories — which have been deemed unsafe by inspectors who found windows nailed shut, among other safety hazards — these children are able to earn at the same levels as their parents, 60 cents per day.

The Nike model is the inevitable result of trade deals which incentivize circumventing labor standards and human rights at the expense of American workers. The United States, as a bastion of individual rights and democracy, should not reward violations of internationally accepted labor standards.

We have fought and worked our way towards a standard of living that we need not apologize for. We believe that employees are entitled to safe working conditions and a fair wage. The president should not endorse any company that offshores its production in an effort to evade these cornerstones of American liberty and prosperity. We should all reflect on the grim prospects for American opportunity that this visit portends. 

Trade's O.K. — But Only If It's Fair

Tell Congress: American manufacturing can benefit from trade, but only if foreign countries are deterred from trade cheating and currency manipulation.

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