Invisible Catastrophes: Erik Loomis on the Consequences of Outsourcing

September 08, 2015

Corporate outsourcing is so common in the U.S. that it’s become exceedingly difficult to avoid consuming products made by unregulated and unethical means. But this has not always been the norm, as several decades ago America’s working class economy was booming, and with the advent of unions, labor laws, and environmental protections, the American dream seemed alive and well.

Here to talk about the history of corporate outsourcing in America, and the effects it has had on the economy, the environment, and the lives and well being of countless overseas workers, is author and labor expert, Dr. Erik Loomis. Dr. Loomis is a history professor, blogger, activist and author of the new book Out of Sight: The Long and Disturbing Story of Corporations Outsourcing Catastrophe. Dr. Loomis explains how various legislative incentives have made it nearly impossible for corporations to invest in cutting back on their carbon output, and why irresponsible corporate behavior has led to numerous disasters that take innocent lives and further harm the planet.

This is point of inquiry for Tuesday, September three, 2015. 

Hello and welcome to Point of Inquiry. A production of the Center for Inquiry. I’m your host, Lindsay Beyerstein. My guest today is Eric Lumis, a professor of history at the University of Rhode Island who studies the history of labor and environmentalism in North America. He blogs at lawyers, guns and money, and he is aware of all Internet traditions. His new book is called Out of Sight The Long and Disturbing History of Corporations Outsourcing Catastrophe. I’m proud to say that I played a small part in bringing this book to life. The new press has meetings where they invite writers in and ask them who they think is doing exciting work that might be a good fit for a new press book. And when they invited me, one of the people I told them about was Eric Loomis, because he was doing such cool stuff on the nexus between environmentalism and labor. 

So they did. And the rest is history. Eric, welcome to the program. Hey, thanks for having me. 

So tell me, how is it that you came to write a book about corporate outsourcing in a historical perspective? 

Sure. I mean, so in you know, in 2013, there was a horrible, as many of your listeners know, a horrible workplace accident in Bangladesh, the Rana Plaza collapse, where over 11 hundred workers died, probably the largest single workplace disaster in the history of the industrial revolution. You know, I was I was already interested in these sorts of issues of labor issues and outsourcing. And it really struck me the similarities between this factory collapse and the triangle fire of New York City in 1911 where 146 workers died. You know, you had it was the exact same industry, the apparel industry, the same types of workers, mostly poor women, young women, and the same kind of labor system which was outsourced labor system where you had department stores contracting with sweatshop owners to make clothing for very cheap and workers with very little power. And I thought it was very striking because after the Triangle Fire, Americans fought and succeeded in taming the worst parts of corporate behavior throughout the whole 20th century triangle. Fire itself leads to all kinds of new provisions about building safety and fire safety and workplace safety. 

And people build on this to create the minimum wage, the eight hour day and all sorts of other things that tame corporate behavior. And yet, a century later, American Apparel companies are doing the exact same thing as they did in Triangle. And I think it’s very telling. How do we get here? How do we get to a world where now American corporations are able to globalize the terrible conditions of the Gilded Age? And that’s what my book is about, trying to build connections between the past and the present and between workers and the decline of the American working and middle class here to the struggles of workers around the world. 

Geographically, there was a lot in common between the shirtwaist fire and the Rana Plaza collapse. Too, right? I mean, the shirtwaist fire was right in downtown New York and the Rana Plaza was right in downtown Dhaka. So presumably a lot of prominent people today in Dhaka saw something horrifying, much like, you know, a lot of prominent people like Frances Perkins, the future secretary of labor, saw when the Triangle factory went up in flames. 

Yeah, and I think that, you know, these factories are built usually well, at least in these two cases, these sweatshops are located in large cities. 

But I think that for me, the key with the geography is that in the triangle fires, as you mentioned, Frances Perkins is one of the witnesses. You know, she gets very involved in these workplace safety reforms and later becomes the secretary labor. 

But that was a situation where you had consumers of this clothing seeing the workers making their clothing dye. And that was very powerful. And that spurs the Frances Perkins of the world to say, we need to do something about this. But today, while certainly people in Bangladesh witness that the consumers of this clothing in the United States, in Europe, they’re not seeing it. It’s far away. You know, that disaster is on the news. For one or two days. 

But because we as consumers are not seeing what’s going on, it makes it much harder to create the reforms to this system that will force these apparel companies to take responsibility for the death of workers. And I think that that’s a key issue of geography. When you have globalized production, when you have corporations able to move anywhere around the world in a race to the bottom, it makes it really difficult for consumers to understand the system in which their goods are being produced and that very much benefit the corporations. And so even if Bangladesh manages to reform. There. 

And end this kind of sweatshop labor. Wal-Mart and Target and the Gap can always just move to Vietnam or to Indonesia or some other nation. And that is a major, major problem in reforming the conditions of work like we did after the Triangle Fire. 

Do you think it was critical, the fact that Frances Perkins was probably buying dresses and shirtwaists and things like that, you know, at her local department store at Bloomingdale’s or wherever it was in those days that she felt that personal connection to the product, not just that she saw the fire? 

I think it matters. Yes. I mean, I think that most people, they don’t want you know, if they’re wearing clothing, as we all are, probably that’s made in these factories. You know, we don’t want actively people to suffer in the production of our clothing. But I think that it’s very easy to say, well, I don’t know what’s going on. And to sort of be able to forget about it. 

And so I think when consumers have the awareness of what’s happening, whether it’s because they saw work or, you know, die or it’s because, you know, they become aware of what’s of what’s happening. You think about the 1990s when you had the anti sweatshop movement develop. And, you know, it wasn’t as if college students were seeing factories in Honduras that were making their college apparel, but they became aware of those conditions. And as aware consumers, they began to fight back on that. And so I think that any way that consumers become aware of the conditions of production where people are suffering and dying, then, yes, they are going to be inclined to try to do something about it. And so the more, you know, awareness that can be generated, the more likely it is that you are going to see significant reform. And so any way that we can raise that kind of consumer awareness is a good thing to do. 

There’s this kind of narrative. We tend to assume that the environment in the United States has just been inexorably deteriorating since the pilgrims got here or since whenever. 

But that’s not really true, as you point out in the book. Can you talk about that? 

Sure. I mean, I think that, you know, I really work hard to convict labor and environmental issues. And I think that we have this narrative. Right, of sort of this beautiful paradise of, you know, 40, 90 to the Europeans come in and just decimate. And that story is a lot more complicated than that on a number of levels. I mean, first of all, you know, there’s this kind of mythology that Native Americans lived in harmony with the natural world, with them, and that’s just simply not true. You know, that that Native Americans, like every other people on the history of the planet, adapt that the landscape to suit their own needs. They didn’t maybe have the technological ability to, you know, cut down all the trees. But it doesn’t mean that they wouldn’t have if they had that opportunity. But as far as sort of connecting it up to the book, I mean, one of the ways at the same time that that Americans are saying, you know, we need to reform labor conditions. They’re also especially in the second half of the 20th century, beginning to say, you know, corporations are also exploiting our natural world and this is a real, really bad thing. And we need to stop this. We need to put some limits on this because, you know, we’re dying from these poisonous fogs that are developing, such as that Northug in Pennsylvania. We are your rivers are catching on fire. We have oil spills everywhere. It’s all beginning to really in the 50s. But then the serious expanding in the 60s and 70s, Americans, including working class Americans, are saying, you know, we need to put some limits on this and we do very successfully. And so the kind of terrible environment of the 19th century and the first half of the 20th century is really something that Americans don’t know today. We we don’t really experience that. Our air is pretty clean. Our water is mostly clean. 

For the most part, corporations are not able to dump chemicals in the water without, you know, without any recourse. 

It’s funny. It’s almost like vaccines where environmental regulations have become victims of their own success, where we don’t realize that the relatively intact environment that we see around us is actually due to this huge regulatory regime that’s keeping it from deteriorating to back when it was in the 19th century. 

Yeah. So I think that’s I think that’s a very accurate comparison. But I think that what has happened is that, you know, corporations were able to operate and be profitable with environmental restrictions, but at the same time that they began to move overseas in order to for cheap labor, they also were able to move overseas so they could continue polluting. And so in many ways, you know, the kind of pollution that goes into making our products is not any different today than it was in nineteen hundred, except that that pollution is again out of our sight. The air is not terrible in Pittsburgh. It’s terrible in Beijing. We’re not dumping chemicals into the rivers in Cleveland. We’re dumping them into the rivers in Bangladesh. Once again, it’s the same system, just globalized and consume. Workers are less likely, again, to act on it because they don’t really know about it. 

Capital becomes so mobile. How did we get from a system where industrialists had to make their stuff here in the US and had to abide by U.S. laws and know respect employees and the environment to a system where they can just pick up and go wherever they want and do whatever they want. 

So companies always wanted to escape these regulations and to some extent they were able to in the early part of the 20th century. The apparel industry, again, the production model of apparel, has always been incredibly exploitative. And so really as early as the 20s and 30s, you are seeing some apparel companies move out of there now, unionized shops in New England and in New York and in New Jersey and beginning to move down to North Carolina and Tennessee and Alabama in order to create union free workplaces there. Now, eventually, a lot of those workers will unionize as well. And so there’s always a sort of attempt to escape unions and escape war by moving to nonunion states or states with less regulations. But the international part, this really begins in the 1960s where you have the Mexican government decide to create what’s called the border industrialization product, where basically they’re going to try to attract American industry across the border by advertising their cheap labor and their ability to pollute and all of this. And that is a very strongly assisted by the federal government. So the government trying to please corporations basically encourages this. 

The Mexican government or our government are both really both governments. 

And so you have really even as far back as the Roosevelt administration in the 30s, some sort of a long term plan, for instance, to move steel production into Latin America as a way to industrialize Latin America, make these Latin American nations more friendly to America, mainly in the 60s. That really begins to expand during the Johnson administration. As you you really begin to see sort of Johnson destruction, economic policies began to effectively encourage companies to move abroad. And then in the 70s, corporations began to get very, very aggressive about it. And by that time, you know, it effectively becomes almost a bipartisan a bipartisan thing that companies are going to move abroad and and politicians are effectively going to support that. Not all politicians, but the Republican Party becomes very supportive and large sections of Democratic Party as well. 

And some unions thought this was a good idea, too, at the time. Right. Because it would create markets overseas for our goods. 

Yes. I mean, there is some of that, you know, in the 60s unions I really believe that the economy’s going to continue to grow, that working people are going to continue to be a central part of that economy and they’re going to have a bigger piece of the pie. And, you know, union members are going to live better lives. And so, you know, sometimes the organized labor is a little slow to recognize this threat and they don’t adjust very well at all. By the 70s, the conversations really shifted where they began to realize what’s happening. And they’re very unable to shift system. So, for instance, that, you know, a response to the rise of competition from Japanese autos is, you know, UAW members smash Toyotas with sledgehammers, which maybe feels good. But it’s not a very useful response to the sort of foreign competition that begins to come in and undermine American unions. 

Big international trade agreements, things like NAFTA and CAFTA and those kinds of deals affect this process of capital mobility. 

I think that a one mistake that we often make, those who are worried about things like capital mobility and worried about trade agreements is that we just focus on the trade agreement themselves. So I and many others are very concerned of Trans-Pacific Partnership that President Obama is pushing and for good reason. Trade agreements are important. But many people who say, oh, the critics of Trans-Pacific Partnership along, we’ll go back and somewhat accurately say that Nasta is not the only problem here. NAFTA did not cause all of this capital mobility. And they’re correct about that. Capital mobility was well underway. Outsourcing of jobs was well underway before Nasta comes into play. What trade agreements like NARTH to do is create effectively international systems that encourage this capital mobility, that encourage outsourcing, that encourage, you know, a kind of integrated economy between nations, that really incentivize is cheap labor and incentivizes a kind of race to the bottom. And so, you know, NAFTA is very damaging to the American working class. But what it really did in many ways was ratify and increase an. Already existing system that had already been going on for almost 30 years. 

By the time NAFTA gets passed and how does it have to make it easier or more lucrative for corporations to outsource jobs? 

Sure. I mean, what free trade agreements do, like NAFTA, is reduce or eliminate trade barriers, which makes it even cheaper for a company, USA steel company or chemical company, to move their production from the U.S. into Mexico, for instance. And the Trans-Pacific Partnership will continue to do that by reducing trade barriers between nations around the Pacific. 

Even more so, trade barriers are things like duties and that kind of thing. Tariffs, yes. 

Yes, basically. Right. So basically, effectively, duties are taxes on imported goods that had traditionally been used to protect domestic industry from foreign competition. Those get eliminated or largely eliminated in these trade agreements. So it certainly encourages kind of a global race to the bottom by making it more profitable for companies to move their production to Mexico or Transdev hardship to a Malaysia or or other nations around the Pacific. But it’s already quite profitable for them to do that. And it basically institutionalizes preexisting is part labor relations go. It institutionalizes preexisting trends. 

What is the Trans-Pacific Partnership and why should we be concerned about it? 

The Trans-Pacific Partnership is a 12 nation trade agreement that President Obama is pushing, making really one of his very top political priorities in the second half of his final term. And what the Trans-Pacific Partnership does, it’s nations ranging from the U.S. and Canada to several South American nations, and probably most importantly, several, several Asian nations, including Malaysia, which is one of the biggest players in this. What it does is it continues to reduce these tariffs. Bill is really concerning about the Trans-Pacific Partnership is that it’s creating what’s called an investor state dispute settlement system. And these are basically courts that will allow corporations to sue or prosecute governments, whether it’s national governments or even state and local governments in the United States, for instance, for enacting policies that are seen to hurt those corporate interests. And these kind of international courts are already being developed in different ways. And so you have, for instance, you know, Philip Morris, the U.S. tobacco company, suing nations for enacting anti tobacco policies. And this is an enormous threat because what that does is, is it potentially says, well, you know, if the state of Rhode Island, where I live, an act, some law that would say limit or put restrictions on the kinds of conditions that goods coming into this state would be allowed, potentially corporations could then or or national governments could come after Rhode Island and say, oh, you can’t do that. 

That’s a trade violation. And so basically, it creates a system, of course, that have no accountability to the peoples of these nations and could really serve to undermine any ability to raise the conditions of labor or of restricting pollution or other sorts of laws that we might create to reform this system. 

That is very, very scary to anybody who cares about these issues and really defeating this Trans-Pacific Partnership, at least as it’s currently it looks like it’s being written. It should be a very high priority for any of us. 

Could it go the other way around, like, let’s say I’m a farmer in Kansas and we’re in the Trans-Pacific Partnership, hypothetically. And I see that factory farms in Malaysia are causing disease to spread. That’s affecting my economic prospects like bird flu. It’s a duck farmer and all my birds have to be euthanized because some farmer in China was not observing good practices and, you know, caused an outbreak of bird flu. Could we sue them back under the same agreement? 

It’s possible. I mean, I think that, you know, a system where you have the ability to raise standards internationally I think is potentially a positive system. I think that the concern is that so so the scenario that you bring up is something that could be of interest is something that we may find valuable. 

I think the concern is that the way that it’s being written and the ways that this has been done in the past is it primarily empowers not everyday people, but rather corporations. 

And so, as far as I’m aware, there’s no say ability in the Trans-Pacific Partnership for your Kansas farm. More to come after Malaysia for its poor farming practices and as these courts have already been developing around the world, really the only situations that we have been seeing is companies or sometimes the nations that support those companies suing to reduce the ability to protect citizens, sue to reduce labor standards and these sorts of things. You know, if we can rewrite the Trans-Pacific Partnership, for instance, to create a kind of a system that would empower us to raise standards, I think there is value in that as it seems to be written. And again, much of it’s quite secretive. You know, that does not seem to be in there and that’s a problem. 

How did these kinds of international entanglements affect our ability nationally and globally to combat climate change? 

Well, it could be quite negative. I mean, if, for instance, you know, Royal Dutch Shell or Exxon Mobil can come after a can come after a nation for enacting strict emissions standards or to reduce oil or these sorts of things, then it really, you know, gives corporations that are invested in dirty energy. It gives them an incentive and not only an incentive, but as a framework to protect their corporate interests by saying that restrictions on oil use is a trade violation. And so the potential for these kind of agreements to undermine our ability to fight climate change is real. And, you know, that’s yet another reason why this investor state dispute settlement assets, as it’s being it looks like it’s being constructed, needs to be pushed back against it. And it’s it’s a way that both labor activists and environmental activists can come together, because these is ISIS really has the potential to undermine the interconnected attempts to give people better lives, whether it’s a more sustainable life on the land or a more sustainable life in the cities. That’s going to. Are going to be livable in 100 years or the ability of everyday workers to have enough money to pay their rent and not die on the job, whether in the United States or in Bangladesh. These things are very closely connected, and I think that it’s a way that labor environmental activists can work together. 

And there is a history of cooperation between labor and the environment that we tend to forget about. Right. I mean, if you grew up on the West Coast, like you and me, you tend to think of, oh, environmentalists and labor like cats and dogs. You know, they’re both great, but you don’t expect them to get along. But in the book, you talk about how there used to be more solidarity between those two constituencies. Wouldn’t that look like. 

Yeah. I mean, labor and environmentalists have always had sort of alliances of convenience. I mean, they’ve never truly come together and made each other’s agendas their own. But there is in many cases in the past and sometimes in the present where labor and environmentalists come together. So, for instance, if this was especially strong in the 1960s and into the early 1970s, where you had labor and environmentalists both working together to produce OSHA, workplace safety standards, limit chemicals in the workplace and these sorts of things, you know, I have another book coming out later this year called Empire of Timber from Cambridge University Press. That is a book that looks at how the loggers use their labor unions in the Pacific Northwest in order to push for their environmental agendas. And one of the things I talk about in there is how the CIO, Woodworkers Union, the International Workers of America, or IWK, how they were attacking is early as the 1930s attacking corporate destruction of timber and they begin to produce alliances with conservation is as early as 1938, for instance, to promote the creation of Olympic National Park. And those alliances continue really into the 1980s, even though sometimes protecting forests and wilderness means a few less jobs. But they wanted healthy, sustainable force for their workers to work and be able to have jobs for a long period time, also enjoying their leisure time. And so there’s actually a pretty robust history between labor and environmentalists that really is kind of a lost history and one that’s important because I think labor and environmentalists have a lot in common and they need to work together in the 21st century. 

Big environmental groups like Greenpeace to the Sierra Club go wrong somehow in their messaging because it seems like they’ve become pawns in the culture wars and are being used to signify this extremely elite agenda of rich people who can afford to go to beautiful and despoiled wilderness and that sort of thing, and are now resented when they used to be more solidarity. 

Do you feel like big environmental groups went astray somewhere? 

Yes, to some extent. I think that, you know, in part what happens is that by the late 1970s, and especially after the Reagan socially, after Reagan gets elected and takes power in 1980. One, a couple of things are happening by by 1981, first of all, you know, the already existing capital mobility is making workers worried that if they support in more environmental regulations, that they’re going to lose their jobs, because by this time, corporations are already moving on to jobs abroad and are realizing that if they say that new environmental regulations are going to are going to cost workers their jobs, then they are here, then workers are less likely to support them. 

And so the timber industry, for instance, is openly lying to their workers about why they’re losing their jobs in the 1980s. They’re saying it’s environmental protection, it’s not environmental protection, it’s over. Cutting is replacing workers with machines and it’s other sort of timber policies that the industry is creating. But they’re able to cover up their own responsibility for the loss of jobs by blaming environmentalists. 

So, ironically, people are losing jobs in part because of lack of responsible stewardship. Absolutely. Could have been prevented with better laws. 

Absolutely. With better logging practices, there was the ability to have sustainable work in these forests for a long, long time and for different economic policies. I mean, it gets kind of complicated, but but yes. So companies are able to lie about it. But the flip side of that is that the Reagan administration also cuts off access to new environmental regulation. The Reagan administration is, of course, very anti environmentalist. And so what it behooves environmentalists to do by the 1980s is to forget about or to minimize a kind of popular environmentalism and instead turn to the courts in order to protect the environmental legislation already on the books and to ensure that the Reagan administration follows it. And that is a smart strategy on one level. But to do that, they have to raise a lot of money. And what that means is that the environmental movement moves from sort of, you know, a kind of mass movement to trying to target donors to sort of mass mailings with charismatic animals on the covers of their magazines to get people to give money to save the polar bear or to save the rainforest or to save the tiger. 

I am such a sucker for charismatic megafauna. I have to admit. 

Sure. I mean, we all know, right? We all love a cute animal. I mean, not a panda bear on it. Very effective way to fundraise. And and so what that does is, is it. 

It means that environmentalists are become more beholden to to the wealthy or relatively wealthy people who can get money rather than a positive environmental ism. And so, you know, they sort lose those connections with workers and sometimes they’re upset about it. They know it’s a problem, but they’re exploring a political strategy that is effective for them. But it does have Long-Term Effects of making it seem like environmentalists are just about the rich and not about the poor. And they’re doing a somewhat better job of trying to reach out to labor these days. But it’s very much a work in progress. 

Do you think that there’s room for reinventing the environmental message in a way that’s more about creating new laws and therefore appealing to people as a mass populace, as voters, instead of just, you know, trying to retrench the laws and enforce the laws that we already have through the courts? 

Well, I think that if you’re going to create mass environmentalism, it has to affect people where they live. I mean, so I think that people were motivated in the 1960s and 70s to support a robust environmentalism, in part because they experienced the negatives of industrial capitalism in a very profound way and that they couldn’t swim in the river. Right. You know, they were choking on air. These were major problems. And I think that figuring out ways to really get people where they live to connect environmentalism to their lived experiences is going to be necessary to, again, create a popular environmentalism. And I think that has to revolve largely, probably around climate change issues. And, you know, it’s not so easy because climate change is a tough, complex issue. So, you know, I think the breaking climate change down into some of the problems that it already creates, such as coastal flooding, for instance, or increased cockroaches in the cities because they’re hotter and, you know, cockroach infestations in poor people’s housing and higher asthma rates. These sorts of things, I think, are going to become are really important for environmentalists to work on in order to sort of rebuild popular support for environmentalism. I think outside of that, it’s going to be hard. 

How do we cut through all the pseudoscience and denialism where it’s just convenient to say, oh, there’s no proof this week’s heatwave is caused by global warming. There’s no proof that this hurricane or this flood or whatever it is, you’re always giving people an excuse. How do we put it in? How do we frame the evidence in a way where people understand that, yes, there is overwhelming evidence and maybe we could still do something? 

Yeah. I think it’s hard. I think that people like Bill Nye and others have really done a good job in Reise in the last couple of years of really beginning to take ownership of this issue, you know, because the scientific method obviously always. Is has a degree of uncertainty yet. And, you know, uncertainty is not good for message, whereas you have the climate deniers who are incredibly wealthy corporations funding an entire messaging operation saying, oh, this isn’t happening or, oh, we just don’t know yet. So we shouldn’t do anything about it. And that’s that’s very difficult. And I don’t have any great answers about how do we message on climate change. If I did, I’d probably would be much more wealthy than I am now because everybody would really love my answer and and want to enact it. So I don’t know. I think that what you have to do is, is try to organize on the ground around people who are, you know, get around these lived experiences and say, you know, it’s just hotter now than it was 10 years ago. And you can feel that. You can see that on a day to day basis. There’s more flooding in Miami than there was ten to fifteen years ago. And we have to do something. Or Miami is going to disappear and really make this a core issue in, say, Miami politics. You know, I think that’s not easy to do. It takes a lot of resources. 

And think about how much the average person is. Even if you’re not rich, if you have any kind of finances at all, it’s probably tied up in your property. And that’s your entire legacy to leave to your children. I think people might get motivated if you start talking about what your house may not be here. I may not be worth anything if we don’t do something about these trends. 

Yeah, I think that’s right. I mean, I think that, again, you know, focusing on what’s important to everyday people in their everyday lives is how you rebuild this movement on a popular level. And I think that the things like property, for instance, property values, is something that can motivate people. And so, you know, I think that’s certainly a piece of how you create your message around climate change. 

That’s all the time we have for today. Thank you so much for coming on the program. Thank you so much for having me. 

Lindsay Beyerstein

Lindsay Beyerstein

Lindsay Beyerstein is an award-winning investigative journalist and In These Times staff writer who writes the blog Duly Noted. Her stories have appeared in Newsweek, Salon, Slate, The NationMs. Magazine, and other publications. Her photographs have been published in the Wall Street Journal and the New York Times’ City Room. She also blogs at The Hillman Blog (, a publication of the Sidney Hillman Foundation, a non-profit that honors journalism in the public interest.