Among the thousands of small contractor shops where workers sew clothing, in New York and Los Angeles, in New Jersey and around the United States, six out of ten persistently break the labor laws, failing to pay minimum wages or overtime. These sweatshops are right here in the United States, but the government is about to declare virtual disarmament against the lawbreakers.
President Bush's budget calls for a tiny increase in spending on enforcement of the Fair Labor Standards Act--from $166 million to $169 million, or 1.8 percent. Since the authoritative economic forecasts predict price increases between 2.6 and 2.8 percent, the President's budget actually implies a relative loss of enforcement ability. This is not a good time to cut back on law enforcement for minimum wage, overtime and child labor protections. We have been down that road before and it has been disastrous.
When Eisenhower was President in 1957, the Wages and Hours Division of the Department of Labor had one investigator for every 46,000 workers; by 1972 (after a brief deterioration) the figure was similar. This level was apparently adequate, and it was among the factors that led, in the long generation from 1938 (when the Fair Labor Standards Act was passed) to the late 1970s, to the overall decline in abuses and the eradication of the worst sweatshops in manufacturing industries like garment-making.
After the mid-1970s, successive federal budgets chipped away at this level of law enforcement. During the Reagan era, the ratio of Wages and Hours investigators to employees sank to one per 110,000. When President Bush left office, the ratio was one to 130,000. During Clinton's first term, the trend continued; by 1996, the ratio of enforcers to workers was at a low of less than one per 150,000. If the number of investigators had kept pace with the growth of employment, there would have been more than 2,500 officials charged with stopping sweatshop abuses and other violations of the labor laws. Instead, by 1996 there were only 781 investigators (Ike had more than 1,100). This is like firing two out of every three cops and then wondering why there are more robberies.
It was in the mid-1990s, when law enforcement capacity was at its lowest, that the most outrageous abuses were discovered. Seventy-two workers were found held in a virtual slave factory in El Monte, California, in 1995, for example. Mainstream suppliers like Wal-Mart and celebrity endorsers like Kathie Lee Gifford were found engaging contractors who had failed to pay their workers. In this period, too, shops with systematic abuses appeared in what had once been the heartland of the ladies' garment workers union--New York City's garment district. As industry production broke up into 25,000 small contractor shops, law enforcement needs grew, while capability diminished.
Finally, Congress changed course in 1996, when New York's Democratic Congresswoman Nydia Velázquez successfully proposed a sizable increase in appropriations for Wages and Hours investigators, especially in immigration-impacted areas and industries. The number of investigators went from 781 to its current 940--but then it stayed there. Because of continued growth, from 1997 to the present the ratio of investigators to workers has once again deteriorated.
This year, the budget and the appropriations will come before a Democratic Senate. Senator Edward Kennedy is now the chairman of the Senate Committee on Health, Education, Labor and Pensions, which could bring forward long-stalled legislation to hold retailers and manufacturers responsible for labor law violations that contractors commit on their behalf. Given his stature in the Senate, Kennedy could also try to influence the appropriations for the Department of Labor, even though he does not sit on the Appropriations Committee.
Kennedy and other Senate liberals are facing another important fight this year on the minimum wage. But that should go hand in hand with a commitment to enforcing laws that guarantee minimum labor conditions. Hundreds of thousands of apparel workers now work for less than the minimum wage, and it is likely that even larger numbers of restaurant workers are not paid for overtime. This is an area of law enforcement that really is about the administration of justice. Whatever the constraints of the tax bill just passed, the government can afford to enforce its own labor laws. No one wants a government that is too large; right now, when it comes to fair labor standards, we do not have one large enough to do the job.