Posted on 11/02/2007 10:24:10 PM PDT by Justmay
The New Bugaboo: Low Prices
Consider yourself in the following situation: You ask someone to run to the store for you to buy you a candy bar, and you give him more cash than necessary. Keep the change, you tell him. The guy gets to the store and decides to shoplift the candy bar instead. Now, are you responsible for the person’s unethical actions?
In an article titled “China Pays Steep Price As Textile Exports Boom”, the Wall Street Journal suggested that companies like Wal-Mart, Nike and Liz Claiborne bear a responsibility for the unethical behavior of their suppliers. I had to read that one twice. The supplier is polluting, but the customer is to blame. No multinational ever suggested that its supplier pollute. That decision was made by the manufacture, and if the supplier felt pressure from “ever-lower prices”, it could have simply asked for a higher price.
McClatchy Newspapers ran with “U.S. Businesses Share Blame For China Toy Recall” where the idea is also that the fault is ours. All those recalls, you see, were caused by companies that had the audacity – the nerve - to source products at a competitive cost. The idea that price pressure is to blame is very much appreciated by Chinese factory owners, by the way. No matter what manufacturers might be criticized for in the future, thanks to arguments like this one, they can say that the devil made them do it. Got caught cutting corners on quality? Found to be a major polluter? Treating workers poorly? “Wasn’t me,” they’ll insist. “It was those damn low prices!”
The name of the game is always to buy low and to sell for what you can get - it’s called “business”. Nothing new there, and neither are suppliers who cry poor. Not sure if everyone has heard the news, but China is in the midst of the biggest economic boom the world has ever known. It’s hard to sympathize with suppliers who say they have fallen on hard times after learning of the supplier in the Mattel case. The head of the company is worth over $1.1bn.
I love this next part: Those who suggest low prices are to blame are telling us that we can make all of our problems go away by paying the factories more. First, if you give more money to a supplier who has behaved unethically, isn’t that sending the wrong message? What would these people say about a CFO caught embezzling corporate funds? “Well, the poor guy must have needed the money. Let’s give the guy a raise and see if the problem clears up on its own.” There is also a dubious assumption in there anyway - that a supplier who has behaved unethically at $1.00 per unit is suddenly going to behave ethically now that he’s getting $1.10. Some of these China suppliers must be laughing at how the media is portraying their supposed plight.
I have a novel suggestion. Let’s look at unethical actions for what they are and not excuse bad behavior. It is not low prices that are to blame, in any case.
I thought this was a post worth to mention, hits the nail on the head about how prices are blamed for the problems in China. The factories there need to take more responsiblity.
Simple solutions:
Hire AMERICANS here, to make what you sell.
Buy American.
This sounds like a country club whine "waaaaa, holding us responsible is costing us money and we were going to make a pile of it by selling cheap Chinese crap, waaaaaa." Same bunch who whine about enforcing the borders.
Consider yourself in another situation: You own a candy company and you close your factory and fire all the workers because you can buy candy much cheaper from an overseas supplier who makes the candy from doubtful ingredients in doubtful conditions. Are you responsible for your own unethical actions?
We have a winner. Email him with that response, or I will!
Well said. American corporations who facilitate this problem are equally responsible.
And moreso the government, both Federal and local level who permitted union tyranny, punitive taxation and farcical environmental radicalism to drive out competitive industry.
These factories are not all closing their doors. Sometimes, a company in America will outsource “some” of what it needs in order to stay in business. There are also people working in the office and sales staff and warehouse staff. Anyway, you’re missing the point. We’re talking about how people say that Americans are responsible for problems in China like pollution or child labor. Are American companies really to blame?
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