What’s Wrong with Free Trade and Outsourcing?

This article was originally published on The Distributist Review

What’s wrong with free trade and outsourcing? Nothing, according to most capitalists. There is a contingent of populist capitalists who argue that we are harming, if not losing, our economic and political independence with such practices, but they are openly mocked and scoffed at by the majority of “enlightened” economists who are the real decision makers in the United States. Anyone criticizing the doctrine of Global Free Trade is called ignorant, isolationist, and protectionist.In articles and comments here at The Distributist Review, we have pointed out the same problem as these populist capitalists, along with the greater moral aspect to the issue. When the primary factor in business decisions is “economic efficiency,” a euphemism for the maximization of profit, the moral dimension gets ignored. Distributists are not against profit—we do understand that the desire to better one’s condition and state in life can be a positive factor—but it cannot be sought in a morally reprehensible way. This is an idea our critics scoff as well, claiming that, in a free market, we are free to choose to buy or not buy, so there isn’t really any harm.

The problem with that idea is that not all choices are morally equal. Just because someone has the ability to freely choose whether or not to buy something he knows is made from slave labor doesn’t mean that there is no harm. Beyond this, however, is the fact that most people remain blissfully unaware of the conditions of the workers who make the products they buy. They are kept unaware by the fact that the workers are a remote distance from them. What they see are tempting products in attractive packaging, but they do not see the conditions in which those products are made. If the products were made locally, they would be very likely to know about those conditions, With production so far away, it is only when the conditions get so bad as to get the interest of the international media that they get a small glimpse of the human cost of our endless pursuit of maximum profit.

An example of this is the recent revelation of the working conditions of those employed by one of the largest manufacturers of electronic components. Foxconn produces components for many of the largest electronics companies in the world, including many who are based right here in the USA. Now, we need to ask what happened to our own electronics industry? The major players have either outsourced their manufacturing to other countries, been bought out by foreign competitors, or been driven out of business by the fact that it cost more to have good working conditions here in the U.S. than to have conditions so bad that it drives employees to commit suicide. I ask you, is there no moral aspect to this for both the producer as well as the consumer?We in the United States blissfully purchase the latest neat gadgets manufactured by a company whose working conditions are so bad that they prompted sixty teachers and students from twenty universities in China and Taiwan to go undercover to reveal them. Why were American electronics workers replaced in favor of this? Because the production costs were lower. Why do we buy products from companies who contract with such places? The sad truth is that many of us in the United States remain ignorant of the extent to which the products we enjoy are made by people working in conditions we would not tolerate. We have been told lies about how we are helping to better their lives. We have been told lies about how easy it would be to simply retrain our own workers to switch to a new field when their jobs got outsourced to a foreign competitor. We have been conditioned to believe that we are being cheated if we don’t get something for the lowest possible price.

We have been taught by self-serving economists that, whatever problems Capitalism may have, it is the best way to manage an economy. Best? With our own workers losing jobs and foreign workers in conditions so bad that they commit suicide, one has to wonder, “Best for whom?”