Haiti: US opposed minimum wage rise, cables show - Polidicks

[release] [h2] Haiti: US opposed minimum wage rise, cables show[/h2] [B]The United States embassy in Haiti worked closely with factory owners contracted by Levi's, Hanes, and Fruit of the Loom to aggressively block a paltry minimum wage rise for Haitian assembly zone workers.[/B] The moves to block a wage rise for the lowest paid in the western hemisphere were revealed by secret US State Department cables obtained by Haiti Liberte and The Nation magazine. The factory owners refused to pay $0.62 an hour, or $5 per eight-hour day, as mandated by a measure unanimously passed by Haiti’s parliament in June 2009. The cables, provided by WikiLeaks, show that behind the scenes, factory owners were vigorously backed by the US Agency for International Development (USAID) and the US embassy. Before the rise, the minimum daily wage was $1.75 a day. The factory owners told parliament they were willing to give workers a mere nine cent per hour pay rise — to $0.31 an hour — to make T-shirts, bras and underwear for US clothing giants such as Dockers and Nautica. To resolve the impasse, the State Department urged then-Haitian president Rene Preval to intervene. US ambassador Janet Sanderson said in a June 10, 2009 cable to Washington: “A more visible and active engagement by Preval may be critical to resolving the issue of the minimum wage and its protest ‘spin-off’ — or risk the political environment spiraling out of control.” Two months later, Preval negotiated a deal with parliament to create a two-tiered minimum wage rise — one for the textile industry at $3.13 a day and another for all other industrial and commercial sectors at $5 a day. The US embassy was still not pleased. Deputy chief of mission David Lindwall said the $5 a day minimum wage “did not take economic reality into account”, but was a populist measure aimed at appealing to “the unemployed and underpaid masses”. Haitian supporters of the minimum wage rise said that it was needed to keep pace with inflation and alleviate the rising cost of living. Haiti is the poorest country in the hemisphere. The World Food Program estimates that about 3.3 million people in Haiti, a third of the population, are food insecure. Haiti was rocked by the “clorox” food riots of April 2008, named after hunger so painful that it felt like bleach in your stomach. A 2008 Worker Rights Consortium study found a working-class family with one working member and two dependents needed a daily wage of at least $13.75 to meet normal living expenses. US opposition to the minimum wage rise was revealed in 1918 cables provided by WikiLeaks. In response to a request for a statement, the US embassy’s information officer Jon Piechowski told Haiti Liberte: “As a matter of policy, the Department of State does not comment on documents that purport to contain classified information and strongly condemns any illegal disclosure of such information. “In Haiti, approximately 80% of the population is unemployed and 78% earns less than $1 a day — the US government is working with the Government of Haiti and international partners to help create jobs, support economic growth, promote foreign direct investment that meets [International Labor Orgainsation] labor standards in the apparel industry, and invest in agriculture and beyond.” For a 20-month period between early February 2008 and October 2009, US embassy officials closely monitored and reported on the minimum wage issue. The cables show that the embassy fully understood how popular the measure was in Haiti. The cables said that the new minimum wage even had support from most of the Haitian business community “based on reports that wages in the Dominican Republic and Nicaragua (competitors in the garment industry) will increase also”. But the proposal faced fierce opposition from Haiti's tiny assembly zone elite, which Washington had long been supporting with direct financial aid and free trade deals. In 2006, the US Congress passed the Haitian Hemispheric Opportunity through Partnership Encouragement (HOPE) bill. This gave Haitian assembly zone manufacturers preferential trade incentives. Two years later, Congress passed an even more generous bill called HOPE II. USAID provided technical assistance and training programs to factories to help them expand and take advantage of the new law. US embassy cables claimed these efforts were threatened by parliamentary demands for a wage hike to keep pace with soaring inflation and high food prices. A June 17, 2009, confidential cable from charge d’affairs Thomas C Tighe to Washington said: “Textile industry representatives, led by the Association of Haitian Industry (ADIH), objected to the immediate ($3.25) per day wage increase in the assembly sector, saying it would devastate the industry and negatively impact the benefits of … HOPE II.” Ironically, Tighe’s confidential cable one week earlier, said the ADIH study had found that “overall, the average salary for workers in the [garment assembly] sector is $4.33” — only 67 cents a day less than the proposed minimum wage. Nonetheless, the study urged opposing any rise in the minimum wage because “the current salary structure promotes productivity and serves as a competitive wage in the region”. Tighe noted, however, that the “minimum salary for workers in the Free Trade Zone on the [Haiti-Domincan Republic] border is approximately $6.00”, a dollar more than the $5 demanded. Still, the ADIH report concluded somehow that the minimum daily being demanded would cause “the loss of 10,000 workers”, more than one third of Haiti's 27,000 garment workers at that time. Tighe said the ADIH and USAID “funded studies on the impact of near tripling of the minimum wage on the textile sector found that [the proposed] minimum wage would make the sector economically unviable and consequently force factories to shut down”. Bolstered by the USAID study, factory owners lobbied heavily against the rise, the cables said. The cables reveal how closely the US embassy monitored widespread pro-wage rise protests and openly worried about the political impact of the minimum wage battle. United Nations troops were called in to quell student protests, sparking further demands for the end of the UN military occupation of Haiti. On August 10, 2009, garment workers, students and other activists protested at the Industrial Park near Port-au-Prince airport. The police arrested two students, Guerchang Bastia and Patrick Joseph, on the charge of inciting the workers. Demanding their immediate release, protesters marched to the Delmas 33 police station, where the police fired tear-gas and the throng replied with rock-throwing. In the course of the demonstration, the windshield of Tighe's vehicle was smashed, and he took refuge in the police station. Due to the fierce protests of workers and students, sweatshop owners and Washington won only a partial victory in the minimum wage battle, delaying the $5 a day minimum for one year and keeping the assembly sector's minimum wage a notch below all other sectors. In October 2010, assembly workers' minimum wage rose to $5 a day, while in all other sectors it went to $6.25. The Haitian Platform for Development Alternatives said in June 2009: “Every time the minimum wage has been discussed, [the assembly industry bourgeoisie in] ADIH has cried wolf to scare the government against its passage: that raising the minimum wage would mean the certain and immediate closure of industry in Haiti and the cause of a sudden loss of jobs. “In every case, it was a lie.” [url=http://www.greenleft.org.au/node/47890]Pasta Sauce[/url] [url=http://wikileaks.ch/cable/2009/12/09PORTAUPRINCE961.html]Leaky leaky.[/url] [/release] [img]http://fi.somethingawful.com/images/smilies/negativeman-55f.png[/img]

wow a US embassy undercutting the lower class in other countries this is a surprise!!!!!!!!!!!! This happens in a lot of third world countries, especially with corporations that need raw labor.

I thought Republicans were saying that we're losing jobs because of the low wages in other countries? So if they're going to keep wages low in Haiti, they're pretty much preventing jobs from coming back to the US. Nothing new I guess.

This is despicable.

Well it's not surprising since the US gets most of their stuff from other countries that have a low minimum wage and if it rises the prices for stuff in America would rise too.

Are you all idiots or something??? Republicans need that money to fuel their furnaces with coal!!! How inconsiderate are those people!!!

[QUOTE=MasterG;30413911]Honestly with the way the US has been acting in the past 10 years? Doesn't surprise me.[/QUOTE] If by "US" you mean "Western world" and by "10" you mean "500".

If the cost of living and economy remained constant in Haiti, I don't see a problem with the minimum wage not being raised. If the economy was not strong enough so that most employers could not afford to pay their workers a higher wage, it would've just resulted in Haitian job losses, which would mean that the US probably did Haiti a favour. The Irish economy has weakened over the last few years and our minimum wage has been cut. Its the same principle. That said, if the Haitian economy was getting much stronger then the US really doesn't have much of an excuse.

[QUOTE=Caesar;30414920]If the cost of living and economy remained constant in Haiti, I don't see a problem with the minimum wage not being raised. If the economy was not strong enough so that most employers could not afford to pay their workers a higher wage, it would've just resulted in Haitian job losses, which would mean that the US probably did Haiti a favour. The Irish economy has weakened over the last few years and our minimum wage has been cut. Its the same principle. That said, if the Haitian economy was getting much stronger then the US really doesn't have much of an excuse.[/QUOTE] If the wage rise was solely down to economic issues, then there wouldn't be a problem, thats tough luck. However, it's a targeted measure by the US government to keep the US's good cheap. That isn't OK in the slightest.

[QUOTE=Caesar;30414920] The Irish economy has weakened over the last few years and our minimum wage has been cut. Its the same principle.[/QUOTE] Reducing the minimum wage helps the economy how

[QUOTE=Zeke129;30417658]Reducing the minimum wage helps the economy how[/QUOTE] increases jobs because companies dont have to pay as much to employ people although people are making less money, more people are making money at least thats my understanding

[QUOTE=yawmwen;30417925]increases jobs because companies dont have to pay as much to employ people although people are making less money, more people are making money at least thats my understanding[/QUOTE] If people are making less money they'll be spending less though, I can't see how there would be an overall positive benefit

Americans prison system also out beats Mexican industry. Sadly, the western lifestyle lives by making sure the eastern world does not. One man suffers so the other may enjoy himself. Such a shame, but if you want cheap good than be expected for this to happen, its just slavery under a new name.

[QUOTE=Zeke129;30417658]Reducing the minimum wage helps the economy how[/QUOTE] So if the minimum wage was $20/hour in America, that'd be cool right? [editline]e[/editline] That isn't to say i support this whole operation, it's their country and they're free to fuck it up however they want.

[QUOTE=Zeke129;30417965]If people are making less money they'll be spending less though, I can't see how there would be an overall positive benefit[/QUOTE] There is a lot to this argument and it's take a well spoken economist to explain it well. I'll try to find you a good article or video about it. A better way of looking at minimum wage is that it is a price control or labor, and because of this, any argument made against price controls can be made about minimum wage. I would myself give you more reasons, but I'm not confident enough in this area. Here is a quick article I found about the pros and cons. [url]http://www.balancedpolitics.org/minimum_wage.htm[/url] I believe the lecture below talks a bit on why Haiti is so poor, and I believe minimum wage is argued to be a big factor. [media]http://www.youtube.com/watch?v=Dx5fzBNO4l4[/media]

Haiti and its citizens got screwed over the US in the 1800s because Thomas Jefferson was a racist asshole and refused to trade with Haiti in a twisted way to prove that black people couldn't run a country. It worked. In 2011 US companies screw over Haiti and its citizens by not raising an already low minimum wage because the CEOs want to buy another yacht.

[QUOTE=Zeke129;30417965]If people are making less money they'll be spending less though, I can't see how there would be an overall positive benefit[/QUOTE] The millionaires running the factory would have $70 million rather than $75 million. Duh. Think with your head Zeke.

[QUOTE=PvtCupcakes;30420142]The millionaires running the factory would have $70 million rather than $75 million. Duh. Think with your head Zeke.[/QUOTE] No, they'll still have $75 million, they'll just lay off $5 million worth of unskilled labor.

[QUOTE=PvtCupcakes;30420142]The millionaires running the factory would have $70 million rather than $75 million. Duh. Think with your head Zeke.[/QUOTE] Actually, most factory jobs pay far above minimum wage. It's not what you expect particularly mainly in comparison to the country you live in, but on average the best job for workers in third world countries are in factories. Because of this, raising the minimum wage in many of these countries would not affect factory workers, but would rather affect local business and lead more into poverty because the local businesses are not rich and would not be able to support such wage increases. [img]http://www.independent.org/images/article_images/charts/040927_6.gif[/img]

[QUOTE=Zeke129;30417658]Reducing the minimum wage helps the economy how[/QUOTE] As has already been said, the less that employers have to pay to hire workers, the more workers they can hire. The more workers that are hired, the less money the Government needs to pay for social welfare. Because there are more workers, there are more people paying taxes and more people with disposable incomes.

But if we raised their wages, we wouldn't be able to outsource anymore. Then we'd be forced to build the factories here and pay American wages--a nightmare by any measure.

[QUOTE=Ultra Violence;30426827]But if we raised their wages, we wouldn't be able to outsource anymore. Then we'd be forced to build the factories here and pay American wages--a nightmare by any measure.[/QUOTE] Paying American wages? Absurd! I could never afford such luxuries! Excuse me, my money bath is ready. In all honesty, free market is a bitch sometimes. :frown:

[QUOTE=Vaught;30426857]Paying American wages? Absurd! I could never afford such luxuries! Excuse me, my money bath is ready. In all honesty, free market is a bitch sometimes. :frown:[/QUOTE] Free market doesn't exist, also, I like how people just spew out regurgitated nonsense without addressing any of the economic arguments regarding the minimum wage. I know I'm jumping on you last two posters, but try actually contributing to the conversation.

[QUOTE=s0beit;30427250]Free market doesn't exist, also, I like how people just spew out [b]regurgitated nonsense[/b] without addressing any of the economic arguments regarding the minimum wage. I know I'm jumping on you last two posters, but try actually contributing to the conversation.[/QUOTE] Haha, are you kidding me? The ONLY reason the US is opposed to a raise in minimum wage is because outsourcing needs to be cheap to be viable. That [i]is[/i] the economic argument, at least from the US. Sure, Haiti cares about their economy, but the US doesn't care beyond getting product as cheap as possible. Clearly you do not understand how this country operates in regards to outsourcing. And that post you just made was really beneficial to the conversation, as well. You didn't say... anything. Except that you don't agree with us. You didn't even propose a counter argument beyond "lol ur dumb and i disagree w/ u" So what I'm saying is try to actually contribute something to this conversation. [editline]13th June 2011[/editline] Since you rated me dumb, I'm patiently waiting for your rebuttal.

[QUOTE=Ultra Violence;30427490]That [i]is[/i] the economic argument, at least from the US. Sure, Haiti cares about their economy, but the US doesn't care beyond getting product as cheap as possible.[/quote] No, it isn't an economic argument. You can't explain how raising the minimum wage is a good thing, let alone paying them "American wages". If you think it's a realistic possibility that we can pay everyone around the world the same wages as Americans, you're a tool. If you think raising the minimum wage is a good thing, prove it. [QUOTE=Ultra Violence;30427490] Clearly you do not understand how this country operates in regards to outsourcing. [/quote] I understand it perfectly, people in your position, that is, living a cozy life in America think all outsourcing is bad unless they're being payed the same wages as Americans (you know, effectively killing all of their job opportunities because why would you hire somebody overseas to do something for the same price, if not more, because they're across a fucking ocean.) [QUOTE=Ultra Violence;30427490] And that post you just made was really beneficial to the conversation, as well. You didn't say... anything. Except that you don't agree with us. You didn't even propose a counter argument beyond "lol ur dumb and i disagree w/ u" So what I'm saying is try to actually contribute something to this conversation.[/QUOTE] I did, nobody seemed to pay it much mind. You two just shrugged it off and posted stupid, ill informed emotional responses to problems you clearly don't understand. If Haiti wants to raise their minimum wage fine, they should be able to, it's their own country and they won their independence fairly to govern themselves. This doesn't mean that raising the minimum wage to such an extreme degree is a good idea.

[QUOTE=s0beit;30427668]No, it isn't an economic argument. You can't explain how raising the minimum wage is a good thing, let alone paying them "American wages". If you think it's a realistic possibility that we can pay everyone around the world the same wages as Americans, you're a tool.[/quote] Well, first of all I never said that they'd be paid American wages, you need to read better. I was implying that if the wages reach a point where the cost-effectiveness no longer outweighs the fact that these jobs would be wonderful for the large number of unemployed in our own country, it would no longer be feasible to outsource. And I didn't say raising minimum wage is a good thing. I'm saying that America has a very strong interest in keeping it low because they want to make as much of a profit as they can. [quote]If you think raising the minimum wage is a good thing, prove it.[/quote] Never said that. [quote]I understand it perfectly, people in your position, that is, living a cozy life in America think all outsourcing is bad unless they're being payed the same wages as Americans (you know, effectively killing all of their job opportunities because why would you hire somebody overseas to do something for the same price, if not more, because they're across a fucking ocean.)[/quote] I also never said all outsourcing is bad. You're just making up everything here. You're making up assumptions about me based on what you think I'd believe, but have [i]never[/i] said in any of my posts. I also never said they should be paid American wages. Besides repeating yourself, you're repeating made-up arguments that never occurred. [quote]I did, nobody seemed to pay it much mind. You two just shrugged it off and posted stupid, ill informed emotional responses to problems you clearly don't understand.[/quote] Emotional responses? It is VERY obvious that the US's interests lie in keeping wages as low as possible. That is ALL I ever implied. And you're accusing me of "not understanding" when you're making up 90% of this post with things I never said? This is ridiculous. How do you take yourself seriously? [quote]If Haiti wants to raise their minimum wage fine, they should be able to, it's their own country and they won their independence fairly to govern themselves. This doesn't mean that raising the minimum wage [i]to such an extreme degree[/i] is a good idea.[/QUOTE] Who the fuck even said that? The raise they're proposing is a fucking pittance. They're making less for an entire day's work for the work we do for an hour. I think the tiny raise they proposed isn't "extreme." Unless you're still going on about this whole silly thing where you think that I somewhere said they should be paid American wages. By the way, you keep accusing me of not understanding this from an economic point of view, and yet I haven't seen you make a single argument that even addresses the issue. You're making baseless accusations, and have said nothing about the actual Haitian economy or the US economy or the relationship between the two, or even outsourcing in general.

[QUOTE=Ultra Violence;30427760]Well, first of all I never said that they'd be paid American wages, you need to read better. I was implying that if the wages reach a point where the cost-effectiveness no longer outweighs the fact that these jobs would be wonderful for the large number of unemployed in our own country, it would no longer be feasible to outsource. And I didn't say raising minimum wage is a good thing. I'm saying that America has a very strong interest in keeping it low because they want to make as much of a profit as they can.[/quote] Even though I'd agree with you that I don't think policy makers should have [i]any[/i] impact on the wages people here, or across the ocean make (especially), of course it's in our interest to keep wages low. It's in every companies interest to keep wages low. Hospitals would love to pay doctors low wages, they can't though, their labor is scarce. [QUOTE=Ultra Violence;30427760] Never said that. [/quote] I have no idea what you were trying to imply then. [QUOTE=Ultra Violence;30427760] I also never said all outsourcing is bad. You're just making up everything here. You're making up assumptions about me based on what you think I'd believe, but have [i]never[/i] said in any of my posts. I also never said they should be paid American wages. Besides repeating yourself, you're repeating made-up arguments that never occurred.[/quote] [quote]But if we raised their wages, we wouldn't be able to outsource anymore. Then we'd be forced to build the factories here and pay American wages--a nightmare by any measure.[/quote] Once again, just what the hell were you trying to say here. [QUOTE=Ultra Violence;30427760] Emotional responses? It is VERY obvious that the US's interests lie in keeping wages as low as possible. That is ALL I ever implied. And you're accusing me of "not understanding" when you're making up 90% of this post with things I never said? This is ridiculous. How do you take yourself seriously? [/quote] If you mean the US policy makers, I've already said I don't support them interfering, if you mean businesses Employers try to pay the least amount of wage to people willing to take it? OH MY GOD STOP THE PRESSES [QUOTE=Ultra Violence;30427760] Who the fuck even said that? The raise they're proposing is a fucking pittance. They're making less for an entire day's work for the work we do for an hour. I think the tiny raise they proposed isn't "extreme." Unless you're still going on about this whole silly thing where you think that I somewhere said they should be paid American wages. By the way, you keep accusing me of not understanding this from an economic point of view, and yet I haven't seen you make a single argument that even addresses the issue. You're making baseless accusations, and have said nothing about the actual Haitian economy or the US economy or the relationship between the two, or even outsourcing in general.[/QUOTE] [quote]Before the rise, the minimum daily wage was $1.75 a day.[/quote] [quote]Two months later, Preval negotiated a deal with parliament to create a two-tiered minimum wage rise — one for the textile industry at $3.13 a day and another for all other industrial and commercial sectors at $5 a day.[/quote] On their standards, how is this pittance? It's quite a grand increase.

[QUOTE=s0beit;30427892]Even though I'd agree with you that I don't think policy makers should have [i]any[/i] impact on the wages people here, or across the ocean make (especially), of course it's in our interest to keep wages low. It's in every companies interest to keep wages low. Hospitals would love to pay doctors low wages, they can't though, their labor is scarce.[/quote] Um, also never said anything about policy makers. [quote]I have no idea what you were trying to imply then.[/quote] Clearly. You haven't had any idea since my first post. [quote]If you mean the US policy makers, I've already said I don't support them interfering, if you mean businesses[/quote] Once again, no. I never mentioned anything about policy makers. I am talking about the businesses that have involved themselves in the Haitian economy. [quote]Employers try to pay the least amount of wage to people willing to take it? OH MY GOD STOP THE PRESSES[/quote] Wow, you're just getting more ridiculous by the minute. My first post was exactly that: yes, the US will do anything they can to keep wages low in countries they have outsourced to. You are the one that decided to make an issue of that one [obviously true] statement, telling me I have no idea what I'm talking about. So if anyone's stopping the presses, it's you. [quote]On their standards, how is this pittance? It's quite a grand increase.[/QUOTE] We aren't talking about it from the Haitian point of view. I'm talking about it from the perspective of the United States and the perceived benefits of outsourcing. But I'm done with this. Your arguments are weak and half of it consists of made up things I never said.

[QUOTE=Caesar;30426287]As has already been said, the less that employers have to pay to hire workers, the more workers they can hire. The more workers that are hired, the less money the Government needs to pay for social welfare. Because there are more workers, there are more people paying taxes and more people with disposable incomes.[/QUOTE] The production of a product has to be at the same level as the demand for a product, and because of this hiring more workers isn't necessarily good because it can lead to overproduction. So, reducing minimal wages doesn't necessarily mean that companies will employ more people. And if they are at the same time lowering the workers' wages, it leads to a reduction in aggregate demand, since the people can't buy as much, and that is directly harmful for the economy.

:munch: