Saturday, July 21, 2007

With what level of economic exploitation....

...are you comfortable?

My wife and I watched Blood Diamond last night. It is a good movie, with an interesting point. One criticism of western style capitalism is that it pushes economic exploitation into third world countries. While there is little economic exploitation in the United States (there may be some with immigration and a low minimum wage, but these can be serious topics for debate), the economic exploitation that should be in the US is now in other countries.

For example: criticism against Wal-Mart is that it sells very cheap products that it gets from foreign nations, especially China. Since the cost to make the products is so low, the store can pass that savings on to the consumer. In the process, the people that make the products receive very little for their work, hence the economic exploitation. But people in the United States are either (1) not aware of this portion of the free market equation or (2) do not care because the prices are so low. (At one point the giant retail store mainly sold products that were made in America but that was not economically viable for a large chain that aims for the lower classes.)

In Blood Diamond, the story goes that because there is a demand for diamonds (people in the west want them for their engagement rings and other forms of fancy jewelry), that countries fight for the ability of mine and sell them. In this economic process, Civil Wars emerge in Africa to wet the appetites of the West. (There is also a sub-plot that major diamond outlets in the West do not meet the demand for diamonds by keeping the diamonds in storage so as to artificially raise the price of the stone. By keeping some diamonds off the market companies can charge more for the diamonds which are on the markets-- there is more supply available but it could ruin the profit).

And yet, with Blood Diamond, there not a rejection of buying diamonds but a
"realistic" call to action- demand that consumers buy conflict-free diamonds, which would be similar to clothing lines advertising that the clothes are not the product of child-labor.

But this post raises the simple question: how much economic exploitation are you willing to allow in the marketplace in order to fulfill your lifestyle?

This would include clothing (shirts, pants, shoes), technology, food (soft-drinks, especially in plants are in South America, which may not let workers unionize), and shelter?

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