|
IN AMERICA: Nike's Pyramid Scheme
By BOB HERBERT
The New York Times
June 10, 1996
Workers at
sweatshops with Nike
contracts are
grudgingly paid
$2.20
a day
With a wage
scale of $30 a
month,
who
could resist?
|
 Think of
it as a pyramid of exploitation. In the comfort zone at the very top is a stable
of uncaring multimillionaire celebrities--Michael Jordan, Andre Agassi, Spike
Lee et al -- and their guru, the fabulously successful founder and chief
executive of Nike Inc., Philip H. Knight.
At the bottom,
shouldering the crushing weight of Mr. Knight's multinational enterprise, are
the legions of young Asians, mostly women, who work like slaves to turn out
Nike's products, and the media-mesmerized young people in the United States and
elsewhere who somehow have been persuaded to shell out up to $140 for a pair of
sneakers.
More than a third of
Nike's products are manufactured in Indonesia, a human rights backwater where
the minimum wage was deliberately set below the subsistence level in order to
attract foreign investment. Workers at sweatshops with Nike contracts are
grudgingly paid $2.20 a day. It took four years of sometimes violent struggle to
get the minimum wage that high.
Now consider Mr.
Knight. I asked Nike on Friday what he was worth. After hemming and hawing about
such incidentals as his $864,583 salary and $787,500 bonus in fiscal 1995, a
spokesman got to the real deal--his Nike stock. Hold onto your sneakers. Mr.
Knight's stock is valued at a breathtaking $4.5 billion.
And, of course, he wants
more. With labor costs skyrocketing in Indonesia, Nike is moving into Vietnam. I
asked a Nike spokesman if he knew what the minimum wage was there. He said it
was 331,000 Vietnamese dollars per month. He said he didn't know how much that
was in American dollars.
I do. It's $30 a month.
What's next? Employees
who'll work for a bowl of gruel?
Philip Knight has an
extraordinary racket going for him. There is absolutely no better way to get
rich than to exploit both the worker and the consumer. If you can get your
product made for next to nothing, and get people to buy it at exorbitant prices,
you get to live at the top of the pyramid.
Nike pays Michael Jordan
$20 million a year to help create the demand for its products. Mr. Agassi
reportedly has a $100 million, 10-year deal to do the same. Spike Lee is paid
big bucks to star in and direct Nike commercials. If these stars, or any of
Nike's other highly paid pitch people, are concerned about the wretched origins
of the company's products, they haven't let on.
Mr. Jordan said,
in essence, that it wasn't his problem. It is up to Nike, he said last week, "to
do what they can to make sure everything is correctly done."
He added: "I
don't know the complete situation. Why should I? I'm trying to do my job.
Hopefully, Nike will do the right thing."
That is the
attitude that prevails throughout the Nike enterprise. Everyone is cloaked in
layer upon layer of deniability. Everybody wants to partake of the riches, but
no one is willing to take responsibility for the fundamental fact that so many
of Nike's products are made by workers who are not paid a living wage, and who
often have to endure the humiliating abuses of brutal bosses and repressive
governments.
Nike's subcontractors
actually hire the workers who make the product. But the subcontractors are
agents of Nike's will, and Nike is ever on the alert for a new situation, a new
country, in which workers can be paid even less. That is why it has established
a foothold in Vietnam.
When I asked Nike
spokesman Keith Peters if the company planned to expand its Vietnam operations,
he said yes.
With a wage scale of $30
a month, who could resist?
Nike also has goods made
in China, South Korea, Taiwan and Thailand. The company's pattern of operations
follows a very simple theme: as wages and living standards increase, Nike looks
elsewhere. Every time the company has moved its operations from one country to
another it has been to a place with a lower wage scale.
While the fabulous wealth
of men like Philip Knight and Michael Jordan continues to soar, the pathetic
wages of the workers who make Nike products are ruthlessly suppressed.
Human rights workers are
already calling the hike in Indonesia's minimum wage to $2.20 a day a Pyrrhic
victory. They fear that companies like Nike, rather than doing the right thing
by workers, will soon be off to more hideous pastures.
|
