Buying American

New at Reason: Julian Sanchez tries on American Apparel's no-sweat business plan.

Comments

[Jason Ligon]

Ahh, Ben & Jerry's redux.

How long before they are bought by the Good Humor Man of tee shirts?

[Larry Edelstein]

Two mistakes in this article:

- I think it's silly to slam Diesel. A lot of people like those clothes. Not that it's an important point in the article, but I think it detracts.

- Cheap labor in the developing world *can* be exploitative if corruption in the local government limits the choices that the local labor have and the potential profit they can make. If the provincial governor signs a deal with GlobalCo to build a factory and then strongarms local manufacturers out of the area and takes a profit from the venture, the locals tend to lose.

[Julian Sanchez]

A lot of people like a lot of ugly clothes...

[Larry Edelstein]

Reason is a strange place to advance the notion of universal standards in what are clearly matters of taste, Julian.

[Douglas Fletcher]

I won't be happy until somebody in the fashion world brings back the Mao suit. I'm too fat to fit into my old one.

[SM]

"The standard theory of how markets work?maximizing welfare by efficiently satisfying preferences?starts to look a lot stranger when our own (possibly mistaken) beliefs about what maximizes aggregate welfare becomes an input into our preferences."

What a strange sentence ! It's as if consumers are expected to be mindful of the simplifying assumptions & approximations of free-market models when they shop. The only way that'll happen if shoppers behave like their counterparts in commercials.
Besides, if these guys are making goods available at competitive rates, then why should it concern me any more if the CEO holds peculiar views than when the CEO of GM dumps his wife for a 18 year old girl or dead boy ? Isn't it all about maximizing shareholder value ?
Well, no matter. Just so long as "workers in Asian developing countries" AKA "the children" are happy.

[Jimmy Antley]

How do I get a full size picture of the honey on the http://www.reason.com page? I can't seem to get anything but the thumbnail. What's going on here?

Oh, what was the article about, now?

[fyodor]

SM,

I think Julian's just saying that we know what clothes we like (he sure does, anyway!), but once we started trying to make consumer choices based on which more greatly benefit the world at large, it's a crapshoot as to whether we'll have any success.

And oh, uh, ditto to Jimmy Antley!!

[fyodor]

Larry Edelstein,

If a business participates directly with or provides an incentive to an act of government coercion, then you have a point. But that point applies equally to domestic business activities as well. I hope I never find myself shopping at the Wal-Mart that's getting a tax break to build in place of a bunch of viable small (and very cool) Asian businesses a few miles south of where I live in Denver (I think they may be condemning the businesses, too, though I'm not sure). But I hesitate to hold that against the entire Wal-Mart corporation cause then it would only make sense to boycott all companies that receive government favoritism somewhere or other, in which case I might just end up naked and starving!!

[The Lonewacko Blog]

I agree! The Diesel shop's clothes are gauche! (ZZZZZZZZZzzzzzzzzzz)

Anyhoo, I'd like to know where their cotton comes from. I'd imagine that the cotton used to sew garments in "Romania, Russia... Turkmenistan, or Ukraine" comes from that general area. See 'Aral Sea Loss and Cotton' for a non-labor example of what can happen when trading with countries that don't have the same standards as we do.

[SM]

fyodor,
Sure. But its also true that I might buy pants under the woefully mistaken assumption that it makes me as virile as Brad Pitt or whoever serves that public function these days. Won't work either, right ? Seems to me that Julian disapproves of CEO's worldview & motives and is looking for excuses to attack his business model - it's a miracle he limited himself to one tofu (assuming that's what toffuti is) joke.
And before we start - i shop at k-mart & ikea. Whew !

[Larry Edelstein]

Fyodor - I agree. Domestic tax breaks like that run the gamut from well-meaning gov't attempts at socioeconomic engineering to straight-up corruption. They are fundamentally similar to the corruption I mentioned earlier. (I realize now I forgot to note incompetence as a similar danger.)

Can anyone opine on the effectiveness of Transparency International (http://www.transparency.org) in dealing with these kinds of issues?

[fyodor]

SM,

Well, sure, certainly if the ability to convince one's clientele that shopping at your store helps people across the world improves one's bottom line, it's no better or worse (from a stockholder's point of view) than any other questionable claim a company may make. At this point I gotta admit I'm not sure if that refutes what Julian is saying or not, perhaps because his language tends towards the labyrinthian at times.

[joe]

Man, that's some seriously sloppy use of the word "protectionist." I had no idea that outsourcing your manufacturing to Portugal was a Buchananite idea.

Also, Julian denounced the assumption that outsourcing to third world countries is exploitative. While it isn't necessarily exploitative, it often is. And the company didn't just assume that all Asian manufacturers exploited their workers - they conducted a lengthly, plant by plant search, and based their conclusion on an understanding of the specific circumstances in each location. Sounds to me like Julian is the one making assumptions about offshore working conditions here.

Julian Sanchez feels uncomfortable when people express concern for the well being of foreign workers, and base their business decisions on a desire not to exploit them. Frankly, that tells me a lot more a Julian himself than about the owners of American Apparel.

[mojo jojo]

Have you seen the models in there online store? T-shirts and no bras!!!! Looks like it was cold too. I'm buying.

[Jimmy Antley]

Doug Fletcher, is that Mao suit anything like what David Byrnes of the Talking Heads wears? I want me one, but I don't want people to think I'm a Pinko, either. Where should I shop? Should I wear any accessories? I think in China, though, the only accessory I see a lot is a haircut made with a cereal bowl, but I'm no fashion expert.

Sorry, I can't get serious today - weather's too nice!

[Jimmy Antley]

"Looks like it was cold too" ;-} Nah, not that cold, just a bit nipply out.

And Joe, puhleeze don't pick on Mr. Sanchez - I need to see more of his photo collection (I'm sure he'll say it's his girlfriend, but it's just a file photo usually used for stories about fast-moving cold fronts bringing nipply weather this way.).

[joe]

Man, are you barking up the wrong tree.

[fyodor]

Joe,

I'm not sure if I'm reading your post accurately, but American Apparel's plants are all domestic, so there's no indication that they did any foreign "search." It's BlackSpot who did that, and their quoted criteria include, "working conditions, shoe quality and overall excellence" and nothing else. The latter two have nothing to do with exploitation, and the first is debatable. I guess it won't surprise you to know I see nothing unethical about employing people in poor working conditions as long as they're working there voluntarily. And to leave our basic philosophical differences aside, at the very least one should consider the alternatives a particular community faces rather than simply comparing a factory's working conditions to what exists in the US or even elsewhere in the world. Now, maybe BlackSpot did this, but there is no indication of such from the quote. Furthermore, while I should probably just ignore the ad hominen aspects of your argument altogether, I don't believe Julian ever said outsourcing to Portugal was protectionist, he merely snarkily noted the irony of choosing a location where workers are already more well off on the grounds of helping workers. And I agree that that is quite ironic and wrong-headed. As you can tell from my replies to Larry Edelstein, I acknowledge that there are business arrangements that third parties have a right to call unethical. But if BlackSpot (or American Apparel) ever used such criteria (coercion) in their decision making process, there is absolutely nothing either in Julian's article or in your post that indicates so, whereas criteria are given by BlackSpot that I would agree with Julian have little to nothing to do with "exploitation."

[Will Wilkinson]

Dude, I hope you recognize that "uniformly hideously ugly" is a reflexive phrase.

[fyodor]

What's a reflexive phrase? It's somewhat awkward wording to be sure, but what else can you do when you want to qualify an adjective with multiple adverbs?