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Story Publication logo October 25, 2007

Do U.S., Utah Companies Share the Blame?


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Reporter Loretta Tofani gets inside America's factory, China, where the lack of health and safety...

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Three former factory workers who have high levels of cadmium in their blood and serious medical problems from making nickel-cadmium batteries for U.S. export. Left to right: Chen Honghuan, Liu Hongmei and Xie Xinrong. Image by Loretta Tofani. China, 2007.

Genco Mine Service, a small company that sells trucks that transport miners deep underground, buys its vehicles from a factory in Beijing. The company's owners know the factory uses outdated machinery and unsafe production methods, but they accept those conditions as the normal course of doing business with China.

"China's equipment and machinery are like ours in the 1940s," Genco co-owner Glenn Sebring said. "They can't afford a forklift. If they have to move a truck, they stick four boards under the body and they walk it around."

As he sees it, it's up to China -- not him -- to figure out how to protect factory workers from occupational diseases and injuries. If China someday increases his costs by buying new machines or by providing workers with better protective gear, Sebring may do business elsewhere to remain competitive. "Next maybe it's Micronesia," he said.

Sebring emphasizes that he doesn't want workers to get sick or hurt. But he doesn't believe small businesses like his are responsible for working conditions in factories they may buy from but hardly control.

So who is responsible?

Is it Chinese businesses or the nation's central or local governments? International trade and labor organizations? Consumers themselves who buy -- and demand -- cheap Chinese-made goods?

Pat Goodsell never considered the role she and other shoppers play. The Ogden woman was simply bargain hunting when she paid $99 for a Char-Broil gas stove that she bought as a Mother's Day present for herself.

Told recently that Chinese workers sanding and polishing the parts for the metal grills had contracted the lung disease silicosis, she reacted with dismay.

"I never thought about the Chinese workers who made them," she said, articulating a widespread American view. "We just want it [the product] to work."

Import records tell the story of Utah's growing reliance on Chinese-made goods. In the first five months of this year, Utah companies received 1,680 shipments from overseas. About 85 percent of those shipments originated in China.

What comes here from China? Almost everything, it seems. Furniture, sprinklers and other irrigation equipment, treadmills and stationary bicycles, sleeping bags, rings and necklaces, trampolines, automobile parts, floor tiles and countertops, shipping documents show.

Shipments from China arrive with such regularity that there's little doubt China has become Utah's factory, yet worker safety in China has not been a primary concern.

Businesses typically are singularly focused on the end result when it comes to Chinese-made goods. They exist to increase profits in part by lowering costs, and few businesses are naive about why costs are lower in China.

Sebring, for example, describes how Chinese workers in the factory that makes his mining vehicles wear masks with charcoal filters while spray-painting the vehicles. But they don't work in ventilated spray booths as workers do in the United States -- booths that increase production costs.

"There are no [independent] unions, so they work longer hours," said Sebring, who has visited the factory he used in Beijing at least seven times in the past 10 years. "They don't have a 40-hour work week, like we do."

And although a 2002 Chinese law seeks to protect workers from occupational illnesses, critics say it is rarely enforced.

"The Chinese don't have the same respect for human life we do," he said. "They almost treat the worker as a machine. The attitude is, 'when it wears out, we get another one.' '

Other businesses certainly are motivated to make money, but emphasize they at least try to improve conditions for Chinese workers.

Jeff Elvin, owner of Dakota Enterprises in Edina, Minn., has been to the southern China factory that cuts and polishes the gemstone beads his company imports. While there, he noticed the lack of proper protective gear.

"My dad works in the safety industry, so we sent them boxes of 3-M face masks to stop any rock particles," he said. A 2004 Chinese medical survey organized by Zhang Donghui, a researcher with the Guangzhou Occupational Disease and Prevention Centre, found 56 percent of testing sites inside 152 gem-processing factories in Guangdong Province alone had levels of silica dust exceeding legal limits. Particles from cut rocks and minerals lodge into workers' lungs, causing silicosis, a disease that makes breathing difficult, and eventually impossible.

Elvin said he noticed on a subsequent visit that workers never wore the masks he sent to the factory. "The boxes were there, and the masks were still inside them."

Yet he continues to do business with the factory, Ko Ngar Gems Factory Ltd., even after a court last year ordered its Hong Kong owners to pay worker Feng Xingzhong nearly $60,000 in compensation for silicosis.

"The workers are not completely aware of the dangers that go on, and they don't place value on the same things we do," Elvin said. "They are building income for the family, and the individual doesn't matter so much. They're working for the greater good of the family."

His company provided the masks, he said. "That's as far as we could go."

Does his own inspecting

Downeast Outfitters of Orem does independent audits itself of factories it pays to make its furniture.

Co-owner Bill Freedman said he travels to China up to seven times a year. "People I know in the furniture industry think I'm insane; it's so unusual not to work with a trading partner or agent," he said. "I have no problem traveling there, going by myself."

Freedman said the 15- to 20-hour plane trips are worth it because he can personally inspect factories where he is considering placing orders. Through visits, he can eliminate those factories where conditions are poor or blatantly unsafe.

"They have a gold-rush mentality in China," he said. "People are in such a rush to produce, produce, produce that they're less concerned with providing a safe environment."

On his laptop computer, Freedman displayed a photo of a factory he considered using. On the screen appeared a gymnasium-sized concrete room with small, closed windows near the ceiling. "There's no ventilation in this room, but there's lots of dust," he said. "If you're sanding, the dust has to be ducted to the outside of the factory. This factory doesn't have ducts."

Freedman displayed another photo of someone kneeling, pushing an electric sander over lumber in the factory. "See this man sanding?" he asked. "He's not sitting on a stool. And he's not wearing a mask."

The factory offered Freedman rock-bottom prices, but he decided not to place an order. "If they don't treat the workers well, you know they're not going to treat you well," he said.

As well-intentioned as Freedman appears, he doesn't know whether machines in the factories he visited have safety guards to protect workers from amputation. He also doesn't know whether any accidents or amputations occurred in the dozens of factories he visited.

Still, he feels it's important to work with factories where the conditions appear generous; those factories are more likely to produce quality furniture.

Like all business owners, though, Freedman must juggle his goal of using factories that have decent work conditions with two other goals: getting the products and styles he wants at good quality, and getting a low price.

The concept of American corporate responsibility to overseas workers is still evolving. In the early 1990s, Nike was widely criticized for the low wages it paid workers in Asian factories. Nike initially ignored or deflected criticisms, noting it did not own the factories.

But concerned that criticism could tarnish its brands, Nike and other companies eventually developed codes of conduct they sometimes posted on walls in overseas factories. The codes typically noted he factories were expected to abide by all local laws, including wage and overtime laws.

Still, stories appeared about problems in overseas factories, alleging Nike was not just cheating workers out of wages and overtime, but was using child labor. A 1996 Life magazine photo ishowed a 12-year-old boy in Pakistan stitching a Nike soccer ball.

To enforce codes of conduct, U.S. and multinational companies began hiring auditors to check on compliance. Auditing apparently has protected some children from working in factories; U.S. and multinational companies say they have "zero tolerance" for use of child labor.

But the auditors -- usually, accounting firms -- often miss other major problems, according to Dara O'Rourke, assistant professor of environmental and labor policy at the University of California, Berkeley.

In a September 2000 research paper, O'Rourke wrote that he accompanied auditors on factory inspections in China and Korea in 2000. The auditors failed to note hazardous chemical use, other serious health and safety problems, as well as barriers to freedom of association and collective bargaining.

The reports "miss major issues and paint a false impression of a factory's compliance with local laws," O'Rourke wrote.

Today, some business managers and labor activists alike echo O'Rourke's complaints.

Han Dongfang, a Chinese labor activist expelled from China in 1993, believes the idea of business leaders voluntarily auditing factories -- or paying a company to check that factories abide by health and safety laws -- is ridiculous. "It is naive to expect foreign companies to promote good labor practices," said Han, who works from Hong Kong at China Labour Bulletin. "The reason they go to China is to take advantage of cheap labor and improve their profits."

For its part, the Chinese government acknowledges that millions of workers routinely suffer fatal diseases from toxins used in "foreign-funded" enterprises. It blames the U.S. and other countries for the carcinogenic chemicals and other toxins that are used to make products for export without regard for the Chinese people.

Qiao Jian, the government official who heads the All China Federation of Trade Unions, said one way to address China's occupational safety and health crisis may be to expand the government- controlled union's reach into factories where worker representation is lacking.

"Previously we thought that the trade union should be controlled from top downward and set up by the boss," he said. "But now we're thinking it might be best to leave some things up to the workers and have them express their own free will."

Hansen Wang, owner of Gilbert, Ariz.-based Gem Mall and Popular Gems Corp., cautions against applying U.S. standards to developing nations.

Wang, who said he is from China, has visited the Lucky Gem and Jewelry Factory in Guangdong Province while buying gems. The factory was ordered by a Chinese court to compensate 48 workers for silicosis, including 12 workers who courts ruled had developed silicosis from working at the factory. "From what I've seen there has been much improvement but still there is room to improve," Wang said, noting that the factory has purchased some fans. "More needs to be done."

Virtually all gem-processing factories overseas have unhealthy conditions, Wang said.

"The factory environment cannot be as good as people in the U.S. would like to see," he said. "The standards in the environment outside the factories are not high, so they cannot be high inside the factories. They are factories, after all, and they are in poorer countries."

Regardless, Chinese workers will demand safer work environments, according to labor activist Han. As more Chinese workers get occupational diseases or amputations, the number of strikes and labor actions will spiral in China, he said.

He believes strikes and lawsuits also will challenge U.S. and other overseas companies that do business in China. "Chinese workers must hold foreign companies responsible and take legal actions insisting on the protection of workers' rights," he said.

Garrett Brown, the California industrial hygienist, thinks global change is needed to truly protect workers. The problem is the world economic system -- a system that so prizes low wages and low factory costs that workers' health is ruined, said Brown, who also coordinates the Maquiladora Health & Safety Support Network, a group of 400 professionals working to improve factory conditions.

"Unless you change the world economic system," he said, "you're not going to change this system."

Click here to view the Salt Lake Tribune's special web presentation of the American Imports, Chinese Deaths series.





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