Can Creative Capitalism Save the World?

August 4th, 2008 | By Kelsey | No Comments »

Bill Gates thinks so.

Gates in the pages of Time magazine:

As I see it, there are two great forces of human nature: self-interest and caring for others. Capitalism harnesses self-interest in a helpful and sustainable way but only on behalf of those who can pay. Government aid and philanthropy channel our caring for those who can’t pay. And the world will make lasting progress on the big inequities that remain — problems like AIDS, poverty and education — only if governments and nonprofits do their part by giving more aid and more effective aid. But the improvements will happen faster and last longer if we can channel market forces, including innovation that’s tailored to the needs of the poorest, to complement what governments and nonprofits do. We need a system that draws in innovators and businesses in a far better way than we do today.

Naturally, if companies are going to get more involved, they need to earn some kind of return. This is the heart of creative capitalism. It’s not just about doing more corporate philanthropy or asking companies to be more virtuous. It’s about giving them a real incentive to apply their expertise in new ways, making it possible to earn a return while serving the people who have been left out.

A great place to turn for discussions about Creative Capitalism is THIS BLOG. The contributors list is basically a who’s who of authorities on economics and globalization. The posts and discussions from the blog are going to be anthologized in a book by Simon and Schuster in the fall of 2008.

In the most recent post Stephen Landsburg criticizes Gates’s example of fair trade as a form of creative capitalism:

Never mind the fact that “fair trade” seems to be a euphemism for the enforcement of monopsony power (enriching some producers by pricing others out of the marketplace); this isn’t the place to get into that debate. But this much is directly to the point: Lots of people feel a moral obligation to help poor people in general. No sane person feels a moral obligation to help poor coffee farmers in particular. So the “creative capitalism” solution serves a non-existent goal—and this was one of the best two examples the authors could come up with! (KT: the other was the (Red) program)

In fact, the whole fair trade thing is an excellent illustration of creative capitalism gone insane. You can pay an inflated price for your coffee and put a farmer out of work, or you can buy ordinary coffee, contribute to CARE, and feed a starving child. Please oh please don’t trick people into thinking the former is a good deed.

The questions at hand:

1. Is it better for a consumer to NOT pay a premium for products produced under ethical conditions and to take the money they saved and donate it to charity?

2. Is it better for a business to maximize their profits by whatever means possible and then use the maximized profits to do good?

My thoughts:

Bill Gates talking about how capitalism can cure inequities is kind of like the United States, which wasn’t hindered by environmental regulations during its own industrial expansion, telling developing nations to stop polluting. Bill gates got where he did with cutthroat capitalism, not creative capitalism and the Unites States got where it did by burning unclean fossil fuels.

Gates is more of an example of earning boatloads of cash via cutthroat capitalism and then taking all of his money and trying to change the world. And few would argue that there are any individual philanthropists doing more than Gates to help the world’s poor at this time.

Companies doing “good” would be great, but I think that’s shooting a bit high. I would settle for companies “doing no harm” – to the environment and its employees. A company that donates money to a good cause, but has its products manufactured by workers treated unfairly – unpaid overtime, working off the clock, underpaid, overworked, abused, etc – or does unnecessary harm to the environment, more than negates whatever good their philanthropy does.

Before a company tries to do right in the world, they should do right in their own house.

That said, I think marketing fair trade products is a perfectly legitimate niche. There are people that want to buy products made ethically, and they should have the option.

I find the debate very interesting, and hope to check out the Creative Capitalism blog regularly. I’ve added it to my Blogroll on the right.

Big Buck Boneheads

July 30th, 2008 | By Kelsey | No Comments »

I’m always amazed when companies or individuals with deep-as-the-ocean pockets do things that, to the ordinary Joe and Jane 2nd Mortgage, are so obviously stupid.

Obama is in Germany speaking to 100’s of thousands of people, and McCain poses for the photographers in front of a Weiner Schnitzel Hut in Ohio. DUMB!

Obama speaks behind an Obama seal that too closely resembles the President’s. DUMB!

The New Yorker’s cover featuring the militant Obamas – DUMB!

I’ve written about Nike’s Marty McFly Hyperdunks already. So far the shoes seem like a good idea, and they look okay. When I first read about their new ad featuring the shoes, it didn’t sound like a bad idea either. From Gawker.com:

Nike’s new ad campaign for its Hyperdunk shoes features a series of pictures of basketball players getting dunked on in what’s considered the worst way possible: the dunker dangling off the rim…in the face of the man being dunk-ee. They all have dynamic slogans like “That Ain’t Right!”

When I read that I immediately pictured Vince Carter dunking on that Russian guy. Seems like an okay ad to me.

Then I read about the controversy around the ads. They were labeled homophobic and insulting to the black community that is already heavily hit by AIDS. “Come on people,” I thought, thinking this was just another case of people taking political correctness to ridiculous levels. Then I saw the ad…

Uh, yeah, that ad ain’t right.

Does the defenders face have to be so buried into the dunkers crotch? It looks like his throat is taking a charge. Gross. That is offensive. I feel uncomfortable. Yet if the fella being dunked on was turning his head, I think it would be an acceptable ad.

How many millions of dollars did NIKE spend on highly paid consultants and ad professionals to design this ad, when they could have just pulled someone off the nearest corner to tell them that it was a bad idea?

Whether it’s men vying to run the country or corporations the size of a country, they each could benefit from a little more common sense.

Ever really thought about the banana?

June 26th, 2008 | By Kelsey | No Comments »

Dan Koeppel has. He wrote a book on the fruit titled Banana: The Fate of the Fruit That Changed the World.

Koeppel in the NY Times about bananas:

That bananas have long been the cheapest fruit at the grocery store is astonishing. They’re grown thousands of miles away, they must be transported in cooled containers and even then they survive no more than two weeks after they’re cut off the tree. Apples, in contrast, are typically grown within a few hundred miles of the store and keep for months in a basket out in the garage. Yet apples traditionally have cost at least twice as much per pound as bananas.

I’ll never look at ‘nanas the same.

In defense of Sweatshops

June 3rd, 2008 | By Kelsey | 2 Comments »

Benjamin Powell, Assistant Professor of Economics at Suffolk University, is coming to the defense of sweatshops. In this article he makes several arguments:

- we need to look at jobs in the garment industry in the context of their countries’ economies
- Fighting for workers’ rights alone will lead to the unemployment of workers
- Workers’ rights can only improve if worker efficiency and productivity improves

Here’s an excerpt:

Should Kathy Lee have cried? Her Honduran workers earned 31 cents per day. At 10 hours per day, which is not uncommon in a sweatshop, a worker would earn $3.10. Yet nearly a quarter of Hondurans earn less than $1 per day and nearly half earn less than $2 per day.
Wendy Diaz’s message should have been, “Don’t cry for me, Kathy Lee. Cry for the Hondurans not fortunate enough to work for you.” Instead the U.S. media compared $3.10 per day to U.S. alternatives, not Honduran alternatives. But U.S. alternatives are irrelevant. No one is offering these workers green cards.

This graph shows that most apparel workers earn more than the average person in their country.

I agree that in most of these countries there are much worse ways of trying to make a living, but I’m not so sure about his numbers. Not that I know what the numbers should be, but that’s my point, no one can. He even admits to his assumption:

Data on actual hours worked were not available. Therefore, we provided earnings estimates based on various numbers of hours worked. Since one characteristic of sweatshops is long working hours, we believe the estimates based on 70 hours pr week are the most accurate.

I met workers that worked much longer than 70 hours per week, but didn’t get paid for more than 50. Numbers, like Chinese labor laws, are often pointless. Unless you do extensive worker interviews and studies, I don’t think there is anyway to obtain accurate estimation of wages paid or hours worked in most garment sectors

I’m not a big fan of the way he dismisses the passion of the anti-sweatshop movement. He talks like Charles Kernaghan, arguably the father of the modern movement, is a puppet of US protectionism. As if, Kernaghan’s fight for the workers around the world is a charade for his actual intention of preserving what’s left of the American apparel industry.

Powell’s essential argument is sweatshops are good. The anti-sweatshop movement’s argument is that sweatshops are bad.

In my opinion they’re both wrong.

Michael Pollan’s call to Action: “Plant a garden!”

May 6th, 2008 | By Kelsey | No Comments »

Author Michael Pollan (In defense of Food, The Omnivores Dilemma) recently wrote a call to action in the New York Times Magazine, including this little mid-paragraph nugget:

Sometimes you have to act as if acting will make a difference, even when you can’t prove that it will.

Mainly, he’s talking about the environment, but his message can be applied universally. As I read, I found myself substituting “clothes” for “food”, and “what we wear” for “what we eat”.

Here’s a longer excerpt:

Whatever we can do as individuals to change the way we live at this suddenly very late date does seem utterly inadequate to the challenge. It’s hard to argue with Michael Specter, in a recent New Yorker piece on carbon footprints, when he says: “Personal choices, no matter how virtuous [N.B.!], cannot do enough. It will also take laws and money.” So it will. Yet it is no less accurate or hardheaded to say that laws and money cannot do enough, either; that it will also take profound changes in the way we live. Why? Because the climate-change crisis is at its very bottom a crisis of lifestyle — of character, even. The Big Problem is nothing more or less than the sum total of countless little everyday choices, most of them made by us (consumer spending represents 70 percent of our economy), and most of the rest of them made in the name of our needs and desires and preferences.

For us to wait for legislation or technology to solve the problem of how we’re living our lives suggests we’re not really serious about changing — something our politicians cannot fail to notice. They will not move until we do. Indeed, to look to leaders and experts, to laws and money and grand schemes, to save us from our predicament represents precisely the sort of thinking — passive, delegated, dependent for solutions on specialists — that helped get us into this mess in the first place. It’s hard to believe that the same sort of thinking could now get us out of it.

Confessions of a sweatshop inspector

April 30th, 2008 | By Kelsey | No Comments »

The Washington Monthly has a great piece by editor and former social compliance inspector, T.A. Frank, titled Confessions of a Sweatshop Inspector (first seen on CloneSix). Frank covers a lot of the issues surrounding international sourcing. Here’s a few excerpts:

On the job…

Unfortunately, we missed stuff. All inspections do. And sometimes it was embarrassing. At one follow-up inspection of a factory in Bangkok at which I’d noted some serious but common wage violations, the auditors who followed me found pregnant employees hiding on the roof and Burmese import workers earning criminally low wages. Whoops.

On ignorance is bliss sourcing…

Now, anyone in the business knows that when inspections uncover safety violations or wage underpayment more than once or twice—let alone five times—it’s a sign that bigger problems are lurking beneath. Companies rarely get bamboozled about this sort of thing unless they want to.

And many prefer to be bamboozled, because it’s cheaper.

On WalMart…

I noticed that Wal-Mart claimed to require factories to maintain decent labor standards—but why did it seem to think it could find them among the lowest bidders?

On being an engaged consumer…

Now, I know about good and bad actors mostly because I saw them directly. But ordinary consumers searching on company Web sites—Walmart.com, Nike.com, etc.—can find out almost everything they need to know just sitting at their desks. For instance, just now I learned from Wal-Mart’s latest report on sourcing that only 26 percent of its audits are unannounced. By contrast, of the inspections Target conducts, 100 percent are unannounced. That’s a revealing difference. And companies that do what Nike does—prescreen, build long-term relationships, disclose producers—make a point of emphasizing that fact, and are relatively transparent. Companies that don’t are more guarded. (When in doubt, doubt.)

On child labor…

You may rightly hate the idea of child labor, but firing a fourteen-year-old in Indonesia from a factory job because she is fourteen does nothing but deprive her of income she is understandably desperate to keep. (She’ll find worse work elsewhere, most likely, or simply go hungry.)

On the Challenge…

But when a Chinese factory saves money by making its employees breathe hazardous fumes and, by doing so, closes down a U.S. factory that spends money on proper ventilation and masks, that’s wrong. It’s wrong by any measure. And that’s what we can do something about if we try. It’s the challenge we face as the walls come down, the dolls, pajamas, and televisions come in, and, increasingly, the future of our workers here is tied to that of workers who are oceans away.

Does blogging build a writing career?

April 21st, 2008 | By Kelsey | No Comments »

Abha from Writtenroad.com asks several travel writers HERE, “How important is blogging in building your career as a travel-writer? Has blogging ever got you any work with print publications?” She included part of my answer, here’s the rest:

As far as advancing my career as a writer, blogging has been every bit as important as dumb luck.

It was dumb luck when Literary Agent A stumbled upon my blog, www.whereamiwearing.com and asked me if I had considered writing a book about the subject. This was before I had even left on the trip the blog was about.

When I returned from the trip I went to a writer’s conference in Muncie, Indiana, (not exactly a hotspot for meeting agents) and asked Agent B about pre-contract etiquette dealing with Agent A. Agent B asked about my book and was darn near more enthusiastic about it than me. Agent B, Caren, became my agent and a few months later sold my first book, which shares a name with my blog.

In the year I’ve kept the blog, I’ve spent over 72,000 minutes (50 days) writing it, but never considered myself a blogger until the Publisher’s Marketplace listing of the sale was released:

Non-fiction Narrative: www.whereamiwearing.com blogger Kelsey Timmerman’s WHERE AM I WEARING?, in which the author learns about the garment industry by following the Made In China/Bangladesh/Honduras tags of a complete outfit and goes to the countries to visit the factories that made his clothes and talk to its workers…

I started as a blogger and, with a little dumb luck, I became an author.

As for print publications…

I rarely direct editors of newspapers and magazines to my blog, for the simple fact that they might visit on a day I write about shaving my tongue or farting on airplanes. However, I have adapted blog posts that eventually ran in print publications or aired as essays on NPR. In this way, blogging is more of a personal writing tool for me than an eye-catcher for editors.

Scalzi on writing and money

February 12th, 2008 | By Kelsey | 3 Comments »

Science-fiction writer John Scalzi delivers some “unasked-for advice to new writers about money” on his blog Whatever.

You gotta give Scalzi some credit, few people talk about money, especially writers who often work a lot to make very little. Although, I suspect, it’s easier to talk about money when you make as much as Scalzi. But Scalzi has paid his dues. Here’s a list of his Science Fiction earnings. In 1999 he earned $400 in 2007 $67,000. (Note: he supplements this income with a fair amount of corporate writing, blogging, non fiction writing, so he was able to feed his family in 1999.)

Anyhow, here’s my favorite point of his unasked-for advice:

8. Unless you have a truly compelling reason to be there, get the hell out of New York/LA/San Francisco.

Because they’re friggin’ expensive, that’s why. Let me explain: Just for giggles, I went to Apartments.com and looked for apartments in Manhattan that were renting for what I pay monthly on my mortgage for my four bedroom, 2800 square foot house on a plot of land that is, quite literally, the size of a New York City block ($1750, if you must know, so I looked at the $1700 - $1800 range). I found two, and one was a studio. From $0 to $1800, there are thirteen apartments available. On the entire island of Manhattan. Where there are a million people. I love that, man.

The other day someone in the publishing industry told me that I sound like the type of guy that should move to New York to be in the mix. He even drew a picture something like this: I would arrive from Indiana, stand on the street corner all wide-eyed with my weathered suitcase, a bag of apples my mom packed, full of naïve optimism, and marvel at the big city.

I told him that although I’m sure if would be nice to have connections, if I moved to NYC, Annie would leave me, which would not be a good thing and would completely go against Scalzi’s tip #3. Also, like Scalzi points out, the big city is expensive. In Indiana my writing career affords a pretty nice life (supplemented by my day job and Annie’s) in a 2400 sq foot home. But In NYC, it would afford a pretty nice cardboard box. And I like not having to worry about my walls getting soggy when it rains.

If I lived in a big expensive city, the pressure to earn money would have probably put a stop to my writing career long ago.

The narrative journalism oath

January 29th, 2008 | By Kelsey | No Comments »

1/29/08
Karl Schoenberger author of Levi’s Children: coming to terms with human rights in the global marketplace on narrative journalism:

“When the human rights narrative abandons the pretext of objectivity and crosses over into the realm of pure entertainment, it can become as preposterous as it is insidious.

The problem begins with the occasional purple-prose narrative journalism that reveals shocking tales of egregious human rights violations but neglects to follow up on the factual chain of events or to place the sordid tale into a broader context. The consumer of a newspaper article or a TV newsmagazine expose feels absolved of personal responsibility after experiencing a delicious emotional revulsion to the outrage, without being asked to think about how to prevent it from happening again. For an ephemeral moment, the passive audience for cheesy entertainment journalism can feel good about detesting Nike shoes or virtual slavery on Saipan without any obligation to revisit the intellectual and more challenges of the issue the next day.”

I Kelsey Timmerman, soon-to-be author of Where am I Wearing? do solemnly swear to not use purple-prose (or any other color of prose) in my narrative, to place all sordid tales in a broad context, to avoid having my readers experience any delicious emotional revulsion to outrage, and to cut the cheese out of my journalism.

Thank you.

Things I’m excited about: Finding Osama at Sundance & Bliss

January 25th, 2008 | By Kelsey | 2 Comments »

1. Morgan Spurlock’s new film Where in the World is Osama Bin Laden recently debuted at the Sundance Film festival. I probably won’t be able to see it for some time since films like this don’t come to a theater near me in Muncie, Indiana. So, I’ll have to wait for the DVD. Until then here’s a taste:

2. Eric Weiner’s book The Geography of Bliss. Weiner a former NPR correspondent banished to report from the world’s most depressing places visits the happiest places on Earth. I’m all about chasing an idea from culture to culture and trying to make sense of it. It’s a bold move looking for something as abstract as happiness, but from what I’ve heard about the book, he does a good job of it.

Here’s a question for you:

Which is easier to find Osama Bin Laden or Bliss?