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"The Travels of a T-Shirt in the Global Economy", or, "Trade Protectionism for Fun and Profit!"
Ethan Zuckerman, 14 Mar 05

mytshirt.jpgIn 1999, Pietra Rivoli, an economics professor at Georgetown, found herself listening to an antiglobalization protestor question the origins of university t-shirts: "Who made your t-shirt?... Was it a child in Vietnam, chained to a sewing machine without food or water? Or a young girl from India earning 18 cents an hour and allowed to visit the bathroom only twice a day?"

Rivoli realized that she didn't know where her t-shirt came from, and that she doubted the protester did either. So she decided to find out. Purchasing a shirt on a Ft. Lauderdale street, she traced the origins of her t-shirt from a cotton field in West Texas to a factory in Shanghai, a t-shirt printer in Miami, and its likely eventual fate at a textile recycling facility in Brooklyn and a used garment market in Tanzania.

It's the perfect set up for a global road trip, which she documents in her book The Travels of A T-shirt in a Global Economy.And like all travel writers, the trip - and the lessons it teaches - are deeply colored by the traveller's perspective.

In 1999, Pietra Rivoli, an economics professor at Georgetown, found herself listening to an antiglobalization protestor question the origins of university t-shirts: "Who made your t-shirt?... Was it a child in Vietnam, chained to a sewing machine without food or water? Or a young girl from India earning 18 cents an hour and allowed to visit the bathroom only twice a day?"

Rivoli realized that she didn't know where her t-shirt came from, and that she doubted the protester did either. So she decided to find out. Purchasing a shirt on a Ft. Lauderdale street, she traced the origins of her t-shirt from a cotton field in West Texas to a factory in Shanghai, a t-shirt printer in Miami, and its likely eventual fate at a textile recycling facility in Brooklyn and a used garment market in Tanzania.

It's the perfect set up for a global road trip, which she documents in her book "The Travels of a T-Shirt in the Global Economy". And like all travel writers, the trip - and the lessons it teaches - are deeply colored by the traveller's perspective. As Rivoli is careful to inform us in the introduction, she's a classically trained economist. As such, she often seems more interested in violations of free markets than in violations of human rights. It makes for a bit of an odd journey - fascinating, but there are many times I found Rivoli speeding past the story I wanted to hear towards the story she wanted to tell.

Rivoli's book has three main foci: cotton, Chinese manufacturing, and the "snowflake" market of used clothes. Rivoli points out the amazing fact that the US is still one of the world's largest cotton producers - sharing the top spots with Uzbekistan and China. Economies generally move beyond production of commodity goods as they mature and labor costs rise - commodity production moves to markets where labor is cheaper. (Think about how electronics manufacture moved from the US to Japan to South Korea and Singapore to Taiwan to mainland China over the past five decades.) Why the heck does the US still dominate the cotton market?

Rivoli spends three chapters telling a story about creativity, entrepreneurship, cooperation and American grit... and gives us a much more convincing explanation for America's dominance in the three pages she allots to talking about subsidies. Cotton's story, as Rivoli sees it, is an attempt to squeeze market forces - specifically labor market risk - out of the equation of farming.

Because picking cotton is incredibly difficult work, requiring hundreds of laborers, all of whom need to work at exactly the same time because cotton all blooms at once, farmers need a captive labor pool. Southern farmers accomplished this first by using slave labor, then by creating sharecropping, a form of indentured servitude. As these methods became legally unfeasible, cotton production shifted from the US southeast to Texas, where a sturdier breed of cotton could be picked by machine, removing labor risk by removing labor from the equation.

The last fifty years of cotton's story have involved fewer humans, astounding feats of agricultural research and engineering, and an amazing ability of farmers to band together and own the whole value chain of their crop production. Rivoli marvels that farmers have figured out how to market cotton seeds (they make great frying oil) and stems (feed for cattle), as well as forming collectives to pack, sort, grade, sell and market the cotton and other products. The combination of mechanization, American ingenuity, command of the value chain and agricultural research is what makes the American cotton farmer dominant.
Uzbekistan, hear us roar!

Oh, and subsidies. Big subsidies. A combination of US government subsidies guarantees that US farmers will get a minimum of 72.24 cents a pound for their cotton. Since the global market price for cotton in 2004 was 38 cents a pound, US taxpayers paid cotton farmers a lot of money. We pay cotton farmers more money by requiring American garment factories to purchase a certain percentage of their cotton from American growers, subsiding the price difference. And, just to ensure that cotton farmers don't lose too much sleep, there are programs to compensate farmers for weather losses, to loan them credit and to help them develop new technologies. Our support for American cotton last year was roughly $4 billion dollars, or roughly three times what the US Agency for International Development requested for support for all of Africa in 2004. Rivoli points to a range of students that suggest that US subsidies depress the global price of cotton from anywhere from 3 - 15%.

While Rivoli seems offended by US subsidization of our 25,000 cotton farmers, to the tune of $160,000 per farmer per annum, she doesn't seem to think that countries like India and Pakistan could compete even if the US removed subsidies. She tells a tragic story about Indian farmers experiencing crop failure and drinking pesticide as a way of letting us know that the small farmer is doomed in the face of mass mechanization. This seems to miss the historical point about cotton - it's a crop that, while risky, can be farmed using huge inputs of labor, creating jobs in desperately poor places, and introducing mechanization over time. Seems just about perfect for Mali, India, Pakistan, etc., were such countries able to compete on a level playing field. But hey, I'm not a classically trained economist, so what do I know?

The author's next stop is Shanghai, and the Shanghai Brightness Number 3 Garment Factory. Rivoli is smart enough not to try to turn anecdote into data. She doesn't see the factory as a sweatshop, but she does see it as the latest incarnation of an industry that has always relied on "docile" (her word, not mine) young women who are willing to do repetitive, physically demanding labor in exchange for a chance to escape farm life. She introduces us to Jiang Lan, who works six days a week, eight hours a day tieing together strands of broken yarn. She makes $100 a month, and, according to Rivoli, likes her job.

Rivoli believes her: she sees millwork in China as a way that young women can gain independence from their families, the drudgery of life in rural China and arranged marriages. She pats our activist friend from the introduction on the back, thanking her for making factories safer for the workers, reminds us how bad things were in England, New England and the American south, teases us with the hint of a story about Chinese workers making death threats to employers to receive their back wages, and then plunges on into the story we all really want to hear, about global garment quotas.

While Rivoli somehow makes the long and convoluted story of the 1974 Multifiber tarrif agreement fascinating, I cannot. I tried to do so yesterday in a piece on the garment trade in Lesotho, and largely failed. Suffice it to say that the tarrifs that allow some garments into the US and keep some out are complex, convoluted and very far from this "free trade" that you've heard so much about from American politicians. It will be interesting to read Rivoli's account again in a few years - as her book went to press, the Multifiber Agreement was being "phased out", and most economists are predicting that China will swallow the world's garment market, expanding from a 20% to 70% share, likely devestating the nascent garment industries in countries like Cambodia and Mongolia. And Rivoli's account of the tarrifs and their unintended consequences is a fantastic intro and a really good read... or at least, a really good read as far as accounts of protectionist tarrifs go.

It's not until Rivoli decides to recycle her t-shirt at Goodwill that she actually encounters real free markets. A Brooklyn recycler buys t-shirts from Goodwill and the Salvation Army at 5 cents a pound and sorts them, looking for small-size Levis for resale in Japan and vintage rock t-shirts for European boutiques. (Because each item is unique - a "snowflake" - different processes take place than in commodity economies like cotton or t-shirt production.) The remaining items are sorted into 400 categories - warm clothes for Ukraine, Poland and Moldova, stained white t-shirts to be cut into industrial rags, and most everything else put in 500kg bales and shipped to Africa.

Rivoli acknowledges that the mitumba (used clothes) trade is a controversial one, with some African nations banning the import of America's castoffs as an insult to national pride, or a protection for local garment industries. But she's an unabashed fan of the phenomenon, pleased to see that the "snowflake" effect continues in African markets. Unblemished khaki pants are worth a local fortune, perhaps $5 a pair; shirts from successful sports teams are worth more than shirts from losers; five matching outfits are worth more, because they can be used as a uniform for a store or a restaurant. She's got useful insights on why this industry favors the small player and why China might have a difficult time dominating the market if it chose to take it on. But mostly she's fun to read, simply to see her sheer joy at encountering the classical economist's version of heaven in Dar Es Salaam.

My snarky critiques aside, Rivoli's book is an extremely useful introduction to commodity markets, the "Chinese miracle" in manufacturing, the trade in used clothing and the distorting effect of subsidy and quota on global trade. Readers concerned with labor issues will be baffled at her failure to spend more time on the question of what constitutes a "sweatshop"; trade activists (myself included) find her critique of US cotton subsidies insufficiently harsh. And I wish we got a few stories about her drinking exploits with textile workers or garment recyclers. (I guess classically trained economists just don't do that.) But it's a tremendously useful book and well worth the read.

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Comments

Cotton, besides being subsidized, is also a pesticide-guzzling crop. Protection of the cotton industry in the south is probably the real reason that hemp, the fiber, (which doesn't need pesticides or subsidies) became illegal. I say became because its historic roots are deep - Thomas Jefferson farmed hemp, and the Declaration of Independence was written on hemp paper.


Posted by: Em on 14 Mar 05

I look forward to reading her book. Steinbeck commented on cotton's depletion of the soil in his Grapes of Wrath. China is also one of the world's largest growers/exporters of industrial hemp. Go Em! A fine point: the draft of the Declaration was written on hemp paper--the final document is on parchment.


Posted by: gayc on 15 Mar 05



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