Thursday, February 18, 2010
Baseball, Rawlings Bring New Meaning to Free Trade
In 2006, this reporter shed light on the seemingly unfair labor practices taking place in Costa Rica in a factory operated by the Rawlings Sporting Goods Co., Inc., and now a subsidiary of the multi-national corporation, Jarden Corp. As we embark upon the 2010 MLB season, let us take another look back on this important issue regarding free trade and on that which has transpired since.
At that time, Rawlings was a subsidiary of K2, Inc., primarily a snowboard and in-line skate manufacturer. Then in 2007, Jarden absorbed all of K2's holdings and Rawlings became one of the many assets of Jarden's portfolio.
The Jarden Corp.'s holdings, prior to 2007, had primarily been in the consumer household goods industry, such as with Mr. Coffee®, Oster®, Holmes®, and CrockPot®. It became pro-active in the purchase of outdoor clothing and camping equipment companies such as ExOfficio and Coleman and then with the purchase of K2, which owned Rawlings, Jarden became a force in the professional sporting goods industry as well.
But much like the way corporate takeovers can surface rapidly and on a global scale, with what appears as little hands-on management, corporations' goods are then subject to manufacture in far-off lands with little oversight, too.
And unfortunately, this accomplished strategy, having culminated primarily over the past 25 years, has enjoyed the muscle and delight of the U.S. government and other state governing bodies of countries throughout the world. Unfortunately, global trade does little to improve the standard of living and human condition of the citizens living in such impoverished countries where many global giants relocate.
Since this last report, to wit, Costa Rica has become a member of the Dominican Republic-Central American Free Trade Agreement (DR-CAFTA). Costa Rica, the oldest democracy in Central America, held a voters' referendum in 2007, giving its citizens a voice as to whether they would like to join DR-CAFTA.
The United States Congress rushed through DR-CAFTA in record time, over several months in 2005, but never expected a country such as Costa Rica to actually fight its demands or to obstruct its rush-through process; for all six other CAFTA countries — El Salvador, Honduras, Nicaragua, Guatemala, and the Dominican Republic — were all on board by 2007. As it were, approval for DR-CAFTA was barely passed by Costa Rican voters, and it was not until January 1, 2009 that Costa Rica formally became another Free Trade Zone in Central America.
Few working for or playing in MLB, or for that matter most people living in the U.S., are aware that Free Trade Zones are but only a win for the U.S. government and multi-national corporations operating offshore. Such corporate entities are not required to pay taxes or tariffs, are allowed to import their supplies duty-free, and electricity and water usage are subsidized. Yet, they are not responsible or required to enforce labor and environmental policies that would be required had they remained doing business in the U.S.
The following contains parts of the 2006 article, that encapsulates the story of Rawlings Sporting Goods, Inc. and its subsidiary, Rawlings de Costa Rica, S.A., and its manufacture of some 2.2 million baseballs each year made by hand. These laborers work for MLB's gain, its billionaire owners, and multi-millionaire players, who largely remain mum on this topic to date:
As America's National Pastime has continued to rake in record high revenues over the past several years — in the billions of dollars each season — MLB continues to remain deaf to its critics concerning the manufacture of its official baseball, apparel, and other accessories, with regard to unfair labor practices in the Third World.
In 2004, a 60-page report produced by the National Labor Committee (NLC), an international labor rights organization, entitled, "Foul Ball," initially exposed the poor working conditions of the Rawlings baseball factory in the remote city of Turrialba, Costa Rica.
MLB had a tepid response to such claims. Then, following the report, life-long consumer advocate Ralph Nader wrote a letter to both MLB Commissioner, Bud Selig, and then-Major League Baseball Players Association (MLBPA) Executive Director, Donald Fehr, to address Rawlings' labor practices. Selig referred Nader's letter to his legal department and Donald Fehr said he was unaware of such claims. Neither man ever followed up.
In 2005, the United States government entered into the DR-CAFTA, allowing for further tax breaks, duty-free tariffs and Free Trade Zone status for U.S. corporations doing business in Central America, without providing for any policing of unfair labor practices in such offshore locales. Although the agreement contained language to that effect, there is no enforcement mechanism or political will to instill such.
And instead of it taking the lead in calling-out such a worldwide problem, MLB, through its silence, therefore remains complicit in such exploitation by multi-national corporations throughout the Third World, and especially those that are U.S.-based.
The facts are quite stunning as to what goes into the manufacture of a major league baseball and the sometimes physically-debilitating toll workers take in order to produce some 2.2 million balls utilized each MLB season, in addition to the minor leagues and the NCAA College World Series, with which the Jarden Corp., on behalf of Rawlings, also exclusively contracts.
Rawlings has been operating its baseball factory out of Costa Rica since 1988, as it gradually transitioned its factories from the country of Haiti during its period of government unrest in the late 1980s. Since 1990, Rawlings has produced all of MLB's baseballs in Costa Rica, with its non-professional baseballs manufactured in China.
Although Rawlings also contracts with the National Football League and the National Basketball Association in producing some of its balls and accessories, the baseball itself perhaps best symbolizes all-things-American and is therefore worthy of the attention it garners from critics of the Rawlings factory.
The approximate 600 workers at the baseball factory in Turrialba are either "sewers" who stitch the cowhide covers onto the baseball's sphere, or they are "assemblers" or "winders," responsible for assembling the core's parts, made of two kinds of rubber and cork, and the winding of the ball's four different grades of yarn. Those who stitch are required to complete 108 stitches into the cowhide leather of each ball by hand.
Each sewer must complete one ball every 15 minutes. They are required to reach a minimum quota of 156 balls per week, in a factory without air conditioning, in temperatures exceeding 100°, requiring permission to use bathrooms, and which prohibits workers from speaking to each other on the factory floor.
The hours that workers put in average 11-12 per day and they must always reserve their Saturdays for the factory, in the event an "emergency order" comes through. If not available on Saturday, they are subject to termination.
The gross wages per worker average $1.50 per hour. Workers can earn up to an additional $8.00 per week if they reach the threshold of completing 180 baseballs in one week. Baseball factory workers earn more than the country's minimum wage, but are subject to the Costa Rican Labor Ministry for any increases in the minimum wage.
Provided they reach the minimum weekly ball quota each week, workers are compensated an additional 25-30 cents per baseball by Rawlings. Should they not reach the minimum quota, they again risk being terminated.
The physical impact endured by the sewers has left about one-third of them with carpal tunnel syndrome or repetitive stress injuries, including permanent disability, after just two or three years of stitching. And sadly, most MLB players have no knowledge that every baseball manufactured is done so solely by hand under such conditions. Should a worker miss any length of time greater than a couple of days of work, due to illness or injury, they can be easily replaced due to the desperate employment situation. And their healthcare, thereafter, is in doubt.
Costa Rica, always reliant upon its agriculture to sustain its people and to provide jobs, was dependent upon coffee and sugar cane as its main exports. Yet, in the past several years, as prices for coffee in particular rose, a good part its coffee exports, including its sugar cane industry, lost out to Nicaragua, as even cheaper labor costs prevail there. Some labor experts directly blame the impact of DR-CAFTA on the erosion of the agricultural industry in Costa Rica; the opposite of DR-CAFTA's supposed intent.
Because of the loss of agricultural jobs, the baseball factory now largely sustains the city of Turrialba and its population of 30,000. Rawlings has its workers over a barrel, as they know jobs are scarce, with many more willing to endure such a tough and pressurized work environment.
The NLC, as well as the International Labor Committee (ILO), have called upon Rawlings of Costa Rica, S.A. to modify some of its working conditions. Rawlings was asked to provide ergonomics training for workers in order to reduce repetitive stress injuries, to provide workers with a better wage, and to increase the amount of incentives based upon levels of production. Yet, Rawlings U.S. deferred to Rawlings de Costa Rica, S.A. and the Costa Rican government.
And the NLC emphasizes the need to allow the workers the right to organize in order to regulate problematic issues, without fear of being fired or reprisal, such as forced overtime or forced layoffs after three months, before workers can earn any legal rights. Currently, the workers are well aware that any talk of labor unions will get them dismissed and fear that the factory will go the way of its agricultural industry and relocate to a country where labor is cheaper.
Unfortunately, as the result of doing business abroad, corporations are still subject to the labor laws of the respective country in which they do business. In the case of Costa Rica, there remains a lack of oversight, follow-up, or initially filed documents by the Labor Ministry for worker complaints, throughout all industries.
With respect to collective bargaining, it is permissible by law, but is discouraged in the workplace, with employers encouraging workers to join "solidarity associations" instead. These groups are allowed to assemble, but are prevented from collective bargaining and are partially financed by the employer.
Ralph Nader previously demanded that MLB and the MLBPA, "Adopt internationally recognized workers' rights standards and effective enforcement mechanisms, as a core condition governing all of its product sourcing and license agreements."
Yet, much like the U.S. government's claim it cannot fully enforce its Free Trade Agreements, MLB can make the same claim when it comes to its licensees or subcontractors. Thus, passing the buck becomes an accepted practice and it is chalked it up to the price of doing business in the U.S. and abroad.
Ralph Nader, at the time, went on to say that, "We cannot tell you that it comes as a shock to us that MLB properties do not have any workers' rights guidelines in their licensing agreements. Nor are we surprised by the irony of the Players Associations' Strike Fund being supported by royalties from products which might be made by Third World workers stripped of their own rights. The irony is bitter."
MLB stands pat in that, "Our agreements routinely include provisions that require our partners to comply with applicable laws including those related to employment and workplace safety. At the same time, I am sure you understand that we are not in a position to actively regulate the practices of each and every separate company with which we do business." No, but they could start with the ball — its centerpiece.
It is not too late for MLB and its superstars to take a stand on workers' rights, regardless of lax U.S. laws in the world of Free Trade and its Agreements' legal loopholes. And important to note — although it has only been one year since DR-CAFTA has been realized in Costa Rica — its exports to the U.S. fell 15%, imports from the U.S. to Costa Rica fell 30%, unemployment rose to 7.8% from 4.9% in 2008, and Foreign Direct Investment from other countries fell approximately 30%. Economists will conveniently blame the global recession on these bleak figures, but it represents many Costa Ricans' worst nightmares coming true.
The sweatshop culture in the U.S. ended with the enactment of labor laws and the rise of labor unions. However, one must ask that private industry as well as the U.S. government be held accountable. For not only are both culpable in the permanent export of U.S. jobs, but both stand by — eyes wide open — as workers in other countries, without many of the freedoms U.S. citizens enjoy, are blatantly exploited. For there is no "free trade," as someone ultimately pays.
Take a stand, MLB! Perhaps now is the time for Rawlings to go.