The Last 'Competitive Advantage': Letter From China

Pang Qing Xiang climbs furtively up the narrow staircase leading to the private dining rooms of a noodle shop in Liaoyang, a city in northeastern China. He speaks quietly as he takes a seat, and flinches whenever there is a sound or when someone enters the room. That's the price Pang, 60, is still paying for having tried to organize unpaid employees at the ferro-alloy factory where he worked three years ago. Independent trade unions are banned in China, and Pang's incipient unionism got him nine months in prison, where he was often beaten and abused. "To them we were nothing," says Pang, who is still tailed by plainclothes police officers. "Certainly not people who had a right to demand anything, not even pay. When I told them work without pay is slavery, they just laughed."

Global consumers buying $25 Chinese-made DVD players usually assume Chinese labor is cheap because the country has a limitless supply of poor workers. But the morally cumbersome truth is that the Chinese government systematically prevents workers from being paid the full value of their labor. Chinese workers can join several state-controlled unions, but since the state and politically connected clans, or families, own most of the Chinese economy, official union representatives who work too zealously first get a warning smack on the wrist--then worse. Ask Kong Youping. After Kong, a trade union official in Liaoyang, raised the ire of local officials by fighting doggedly for the rights of recently laid-off workers, he was sentenced to fifteen years in prison.

This power imbalance between owners and workers in China means that almost 200 million Chinese workers go to bed every night in overcrowded dormitory rooms after having worked eighteen-hour days in Dickensian factories where some employees are literally worked to death. The phenomenon has even added a new word to the Mandarin vocabulary: guolaosi, or overwork death, where fatigued workers fall off their stools bleeding from the ears, nose and anus.

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