Socialism or Nike

Against the Current, No. 69, July/August 1997

Bill Resnick

GLOBETROTTING FOR THE cheapest workers, capital manifest in all its imperial trajectory, Nike exemplifies the new economic order and the world it is making.

Nike produces through “subcontractors” forced into the most ruthless labor practices.  It cooperates in state repression of popular movements.  With other transnationals it is reshaping the world system, intensifying income polarization and environmental exploitation.

Nike also struts its stuff.  It’s everywhere, instantly recognizable.  A $100 Nike gym shoe represents $6 of materials and production, $70 of marketing/advertising, and $24 of profit.  Nike’s corporate energies and staff time are mostly devoted to shaping culture and consciousness.

Pushing consumerism to the ultimate, Nike offers us not just the good life but meaning and transcendence, thus embodying capitalism’s thrust to omnipotence, over the economy and also over personhood, identity, society.

Nowhere is Nike bigger than here in Portland, Oregon.  Nike’s “campus” headquarters in suburban Beaverton is just ten minutes up the freeway from downtown.  Nike has pioneered their over-designed, showy, graceless and actually ugly new store/shrines here.

The big daily newspaper, “The Oregonian”, celebrates Nike profit reports with more space and pride than victories by Portland’s pro sports teams.  And its owner-founder Philip Knight is a gangly curly haired Donald Trump, obsessively acquiring more trophies to proclaim his majesty.

In short, Nike makes a perfect target for organizing.  Portland activists’ ongoing anti-Nike campaign caught fire when the school system, suffering from a tax revolt mostly benefitting commercial property, went begging for corporate money.  Nike’s gift was simultaneous with a “Life” magazine expose of Pakistani children stitching Nike soccer balls.”

A school board member who had worked sweatshops in Hong Kong in his youth wondered whether the schools should accept money made on child labor.  His resolution to reject the gift, unless Nike accepted independent monitoring of its Asian contractors, ultimately failed 6-1-but did generate an intense and instructive series of rallies, demonstrations, hearings and store invasion/occupations.

The Nike campaign coalition-including Jobs with Justice, the East Timor Action Network, some Greens, and Justice Do It! Nike, formed by Amnesty International activists when Nike refused to meet with them-was not ready to expressly take the fight to international capital.  The campaign’s critique of Nike has gone at child labor, repressive contractors, its failure to pay minimum wages and support for the Indonesian military state.

Campaign demands have concentrated on independent monitoring of Nike factories, with a boycott in the works.  Nike has of course tried to ignore the campaign: Why dignify and call attention to a challenge with an explicit response?

But once the campaign got public attention, the daily paper came to Nike’s defense, by reciting transnational ideology-how Nike was contributing to the healthy development of foreign countries and how the emerging international division of labor was good for the U.S. economy and its workers.

Fighting the Power

Each new stage of capital generates new tensions and fightback.  All of us live and experience a central paradox on a global scale: vastly expanding technological and productive power, great riches being produced, yet most people getting poorer, less secure, more anxious, and the environment more threatened.

Nike illuminates the paradox.  Nike is global, visible, makes itself simultaneously intriguing and repellant.  Its expanding power and reach-geographical, cultural, psychological-bring it into collision with human drives for autonomy, and meaning, creating a hunger for understanding and alternatives.

Nike’s power and glory give the opportunity and indeed invite and require a response-and envision of an alternative equally big and encompassing.  So taking on Nike can help revive the socialist case. The rest of this article will describe how the campaign has tried to confront Nike and thus global capital, to counter their claims, and to build those big alternative understandings and vision.

1) Does Corporate Investment Foster Economic Development in Poor Countries?

The local big daily, “The Oregonian”, hugely profitable within the Newhouse media empire, speaks for Nike:

“Recent publicity should not obscure the value that Nike’s investment brings to the developing world.”  “Economic development through investments like Nike’s is the most powerful engine available to lift developing nations and their citizens out of poverty.”

Of course the editorial writers didn’t try to cite one country that developed through foreign corporate investment.  Mexico for example has received enormous foreign corporate investment the last twenty years, but Mexican workers’ wages have fallen 50% and Mexico’s environment has been ravaged.

We can show that Nike is no more a developer of Indonesia than United Fruit was in Honduras.  When multinational corporations pay low wages, take their profits out of country, and support oppressive, kleptocratic governments, then their investments just mean misery and destruction of natural resources.

2) Creating an International Economic System Plundering Poor Countries.

Nike and “The Oregonian” stress that Nike’s first Asian stop had been South Korea, implying that South Korea’s growth resulted from the entrance of foreign companies like Nike. And this raises the question: How have the Asian “Tigers” done it?

First we point out the dark sides of the miracle; that they are not attractive models.  And then we point out that the considerable economic growth they generated was not through foreign corporate investment.  Their strategy was to autonomously control capital, usually capital internally mobilized, supplemented by bank and government loans and grants from abroad.

The “Tigers” protected nascent industries.  They limited foreign penetration, requiring transfer of skill and technology to local firms.  In the case of South Korea, U.S. aid and grants (to prop them up against the North) came with few conditions to the government, strengthening state capacity for internal development.

Ultimately South Korean elites were forced to respond to worker movements for higher wages, education, and social benefits.  But Nike is not operating in Indonesia as it was forced to do in Korea.

Nike in fact has been one of the most aggressive multinationals extending the current “free trade” regime via NAFTA and GATT, which expressly deny Indonesia the authority to regulate capital flows or control foreign investment.  Indonesia is prohibited, for example, from requiring investors to transfer technology and skills to domestic producers.

Under the new international economic order, foreign aid and bank loans must be used to support private capital and privatize local assets, thus weakening public economic management while increasing private profits.  And when, pressured by growing workers’ movements, the Indonesian military state proposed raising the minimum wage, Nike threatened to move out and is in fact on its way to Viet Nam.

3) Sweating Third World Labor.

Nike’s defense through “The Oregonian” reads: “Nike’s con- tracts in developing areas include provisions against child labor and requirements that suppliers follow the applicable laws in their own countries.”

Nike can write pious contracts-but we point out that Nike invites violations.  Nike does virtually nothing to demand contractor compliance with child labor and minimum wage laws.

As to Indonesian state repression of labor, and the deals that local manufacturers make with local military to harass and imprison, sometimes kill, labor organizers and journalists, Nike says and does nothing.  And of course Nike is completely silent about Indonesia’s seizure and genocide in East Timor.

In contrast, when Nike sees its interests threatened, as in trademark violations or theft from its factories, Nike takes very decisive action.  Nike and capital’s claims that they are helpless to stop violations because of respect for national sovereignty is contradicted by their practice.

Here is summary of an interview with George Southrey, a former military intelligence officer in Viet Nam, now Nike’s ranking executive in Southeast Asia: “It was Southrey’s job to hire informants who would infiltrate the factories and pose as workers .  .  .  Armed with specific violations and locations, Southrey would then contact the local police and raid the factories.  `It was kind of interesting work,’ Southrey said.”  (“Portland Business Journal,” May 5, 1995)

Nike’s contractors and the Indonesian state come to learn exactly what is permitted and what is not. They know that when the crime is against workers, there’s no enforcement or penalty.

While Nike looks the other way at continuous notorious violations of worker rights, Nike forces the contractors to compete with one another, mostly on the basis of price.  We show that by forcing contractors into shady practices, then taking decisive action against some violations while winking at others, Nike has in effect approved and required criminal acts. That makes Nike complicit in the crimes and violations.

4) Nike and Living Standards in Poor Countries.

Nike insists it’s virtuous.  “The Oregonian” repeated Nike claims that: “In Indonesia the Nike wage is twice the national minimum.  Entry level workers in Indonesia make five times as much as the average farmer.  Nike jobs are widely sought after.”  “The company pays good wages by the standards of the countries where it operates.”

None of this stands up to examination.  As to Nike contractors paying twice the minimum wage, “Business Week” just reported that one Nike contractor asked for a waiver of the minimum wage itself.  And the Indonesian government acknowledges the obvious, that in a country where food is sold at world market prices, a $2 a day minimum wage is barely enough to eat.

The Indonesian government estimates the minimum wage is 93% of subsistence.  This then provides a powerful insight about the global supermarket.  We can show how the new economic order, through the World Bank and “free trade” treaties, strongly discourages food subsidies.  Producers everywhere sell at world market prices, and those who wish to eat all compete for rice, grain, and milk, at the same price.

It is no wonder that U.S. dogs and cats, with their owners’ buying power behind them, eat far better than poor people all over the globe.

And why are Nike jobs, indeed, any job, “sought after?” Why indeed do the children want and need to work, as libertarian supporters of child labor argue?  It’s because multinationals like Nike have intensified exploitation of rural and coastal areas, driving people off the land and traditional employments, driving people into ever enlarging polluted cities.

Sure, people are dying for Nike jobs; and dying when they get them, because Nike and the other predatory multinationals are cooperating with equally vicious domestic elites and the military government to grab all the wealth.

5) Nike, U.S. Workers and the U.S. Economy-Bringing the Struggle Home.

Nike promotes itself as pioneering the path to national economic salvation.  It describes itself as creating high value- added, allegedly high-paid information age work in the United States, while transferring menial low-paid production work to the Third World.

This, according to the fashionable argument, keeps the U.S. economy ahead of the competition, benefitting all of us. These claims collapse when confronted.

There is no “us,” we point out. The international division of labor, which Nike has done as much as any company to establish, exploits and impoverishes workers here and abroad.  Over the past quarter century this country has experienced a vast redistribution of wealth from the poor to the rich, along with a weakening and lax enforcement of environmental regulation.

Nike is “doing it” to the planet and its people.  Indeed, what Nike has helped to innovate globally, U.S. firms do here: They shed their own manufacturing plants, instead dealing with numerous sub-contractors to whom they offer deals that require low wages and shady operations.  And they threaten to leave the city or state unless they get tax and regulatory favors (including environmental surrenders) from governments and wage concessions from workers.

6) Solutions—Managing the World Economy, Their Ideas and Ours.

This explanation of the world economy then enables people to understand that fundamental paradox we all live but seldom think about.

On the one hand, we see and often participate in an immense (and even more immensely hyped and promoted) advance in science, technology and productive power.  On the other hand, we work harder for less, have increased stress and insecurity, and fear for global environmental collapse.

How can that be?  Because international capital has set up a system that systematically creates these outcomes: enriches them, takes from most of us, and defiles the environment.

What then is to be done?  When pressed, Nike and the Clinton Administration come up with answers, co-optive and narrow.

As the tempest over foreign sweatshops and child labor (the embarrassment of Kathy Lee Gifford, Wal-Mart, the GAP) set off by the National Labor Committee Education Fund in Support of Worker and Human Rights heated up, the Clinton Administration, through Robert Reich at the Department of Labor, created a study committee to take a six month look at ways to combat sweatshop conditions in the Third World.

When its troubles didn’t blow over, Nike went into damage control, accepted Reich’s invitation, and joined the group.  Sure enough, “The Oregonian” commented: “Nike Inc.’s recent decision to formally join .  .  .  ought to be seen as a strong statement by the company that it is committed to high standards for its foreign factories.”

In fact Nike was forced to finally admit what it had formerly expressly denied: that it has responsibility for what happens in its “contractors'” factories.

But the Reich/Clinton/Nike study committee is a substitute for meaningful action.  In view of decisive and irrefutable evidence of crimes and human rights violations by its manufacturers, Nike should have taken a number of immediate steps: (1) revise its standards upward, (2) create an effective enforcement unit and arrange for independent monitoring of compliance, (3) announce a “no excuses allowed” policy to its contractors, (4) reopen negotiations, offering contracts that would pay fair wages.

In contrast, agreeing to join a study just permits continuation of the violations (which Nike mandates because of the low payments to contractors), as Nike moves to Viet Nam.

A Global New Deal?

But even had Nike been forced to take these actions, we can show they would be inadequate and no lasting remedy.  We have demonstrated that it is the structure of the world economy that is injuring workers here and there.  Up against this international system, codes of conduct will have little bite or meaning.

It is necessary to reconstruct the international economy.  But what do we propose?  An immediate leap to a non- capitalist world, some vast association of worker/producers, will not play. Probably the best “transitional program” we can promote is a global New Deal, like that proposed by the newly formed Labor Party and the Economic Policy Institute.

Such a program means structural change in international economic management: trade treaties with tough environmental and labor standards; capital controls; transaction taxes on foreign currency markets to reduce speculation; international and inter-country compacts that make impossible corporate blackmail; regulation of footloose companies; progressive taxation; international measures to lift the poor and support labor unions; redeployment of wealth from military spending to massive job creation in environmental restoration, child care, disease prevention.

In contrast to traditional social democracy, the global New Deal would have a democratic and environmental thrust.  And of course we have to emphasize learning and organizing-shop floor power; national unions, movement parties; internationalism; cross border organizing; patiently building a worker/ producer political thrust.

Nike’s World and Ours

Capitalist competition is ratcheting up the sophistication and costs of marketing and distribution.  To maintain or increase market share requires firms to employ more and more advanced and powerful means for creating ever more tight and lasting identifications between buyer and brand name, and to assume dominant or monopoly positions by drowning out competitors.

In doing this-in its perpetual, ever present, no holds barred advertising and self-promotion directed to every consuming segment and invading all of life-Nike is lead and master.  “You don’t sell the steak, you sell the sizzle.”

Whatever the achievements of Coke, Chevrolet, and Camels, Nike sizzles at a whole new level, casting its nets wider and deeper, appealing to and more closely linking with a wider range of human needs, motives, insights.

Take its recent national campaigns directed to women and children, which position Nike opposing undefined evil forces that would deny self-realization, pleasure, freedom.  In contrast Nike is portrayed as protector and friend, standing for freedom, pleasure and self-determination, for safe secure happy childhoods, and against repression/poverty/ want/discrimination.

Other campaigns attach Nike to sociability, compassion, accomplishment, capability and strength, fulfillment, self- expression, excellence, beauty, freedom.  And Nike absorbs and comes to capitalize on resistance and critique too: Its ads have taken to exploiting “resistant readings,” incorporating the critique of advertising, the critique of fakery and fluff and sell, into the Nike message.

Nike is our friend and shares our values.  Nike has in fact brought consumerism to full flower, as far as it can go-in content, process, intensity.

To be sure, before Phil Knight sold his first gym shoe, consumption was the national passion and religion; the mall became our commons, and home, car, clothing, and accoutrements the most intense and significant sources of meaning, security, selfhood and even attachment to others.

Yet Nike suggests more than Coke or Ford ever imagined.  Even in standard marketing methods-associating its products to athletes of great drive and accomplishment, to scenes of pleasure and natural beauty-Nike creates deeper links.  And Nike now explicitly offers meaning and transcendence, feelings and accomplishment beyond human understanding and the usual limits of human experience.

In its images of runners and athletes, individuals and groups, Nike has them undergoing religious transformation, transcendent moments.  And Nike is everywhere, always reminding us, reinforcing its message, so confident and so present that it de-emphasizes its products in order to deeper infiltrate consciousness; some of its most expensive and oft repeated ads and promotions are without sign of shoes, designed only to fortify identification between logo and values, needs, ambitions, yearnings, insights.

The goal goes beyond mere linkage or attachment, beyond just attaching us to assorted Mets, Packers, Cubs, Tigers, Dodgers, cars, soft drinks and the rest. Nike’s marketing campaigns seek to brand the emotion or experience, as so many sports teams and coaches, all the big name college athletic powers, are branded with Nike’s swoosh.

Nike’s goal is an identity deeper and less accessible to rational critique, to become the stuff of consciousness, to become part of the definition of freedom and accomplishment, displacing other definitions and patterns as it must displace Reebok, Converse and New Balance.

How To Resist?

This trajectory of Nike and capital, this more and more advanced and powerful infiltration of consciousness and soul and personhood, is of course grotesque, unsettling, threatening.  People want to fight it, to protect selves and especially children.  The most obvious expressions of fightback are defensive efforts directed to children’s TV, to somehow counter, in Ralph Nader’s term, the “electronic child molesters” of media marketing.

The challenge for progressives is to channel the resistance and fightback from protective/defensive to affirmative/of- fensive/constructive.

We begin with critique.  We can culture jam or deconstruct Nike and capital: the corruption, mockery and cynicism of identifying grace, accomplishment, self-determination, excellence, freedom and meaning with gym shoes.  The misery and waste of alienated labor in a life directed to acquisition.  The emptiness of consumption as way of life.

Nike can be shown as capitalism’s intensifying barbarism, in an Old Testament sense establishing and praying to false Gods, defiling human values, destroying the human bonds that create community.  This critique of Nike/ capitalist barbarism only becomes understandable, and gains its meaning, when placed against other views of human value and a good society that are vividly presented and potentially attainable.

We can ask people to think of the real sources of freedom, friendship and meaning.  We can then contrast our world to Nike’s by presenting alternative economic and social institutions, real life practices and activity, what we actually do on a daily basis.

This age of vast wealth and wondrous technical advance creates the possibilities of rich democratic lives.  We can propose experiments in work reduction, self-management, democratic control of media.  We must insist on the necessity of redeploying national wealth and corporate welfare (including the military budget) into environmental restoration, child care, health, and education.

We can vividly outline new city forms-livable, compact, social, park-like cities-and the considerable investments in alternative transport, affordable housing, land and stream restoration, water quality, and living wage jobs that would make this possible.

We can then show that this vision-laying claim to its Enlightenment heritage, employing reason and a democratic politics to stand up to the forces of profit and selling-preserves human values.  It is such a society and culture, caring of nature and other humans, that generates a sense of accomplishment, solidarity, meaning, connectedness and community, indeed transcendence, as contrasted to capital’s magic of the full life through consumption.

Nike/capital’s so visible imperialism, geographical and psychological, render it suspect and easy to attack.  So, starting with Nike in Indonesian sweatshops, we can examine Nike and global economy, Nike and American workers, and finally Nike and consumer culture and the degradation of consciousness and society.

Taking on Nike can be a way to revive a visionary left, confident in its premises, attacking international capital on all fronts, and demonstrating a counter vision.  Nowhere is Nike more active than in appealing to youth and on campuses.  School and college campaigns might be the initial effort of a campaign with widespread appeal.

While the impulses of the `60s, towards democracy, liberation, self-realization and pleasure defined in social rather than commodified terms are subject to myriad backlash movements (anti-affirmative action, anti-youth, anti-sex, anti-feminist), they remain not just alive but in today’s multiple culture wars still on the offensive, still defying the old order and its authorities.

That’s why Nike can make money portraying itself as rebel and friend of the oppressed, while corrupting the ideals.  So in every venue our claim “socialism or barbarism” can be vividly displayed and made understood-socialism or Nike.”

Bill Resnick is an activist and radio host on Pacifica Radio (KBOO-FM) in Portland, Oregon.

ATC 69, July-August 1997