Wage Slavery and Sweatshops as Free Enterprise?

The conservative American Enterprise Institute offers yet another defense of sweatshops from a self-styled advocate of liberty and free markets, Professor Mark J. Perry. Indeed it is more than just a defense; it’s a selective compilation of quotes and anecdotes hailing sweatshops as perfectly praiseworthy routes out of poverty.

Typical free market defenses of sweatshops focus on the fact that “sweatshops are better than the available alternatives.” These defenses also tend to emphasize sweatshops’ role in a “process of development that ultimately raises living standards.”

When authority precludes other options, using systematic state violence over a course of decades to divest people of their rights and resources, of course sweatshop employment begins to look like a good option, even the best one.

But this selective redaction of history is just how so many supposed champions of free markets earn their reputation for turning a blind eye to economic injustice. Market anarchists find no coherent or principled reason why defenders of freedom, competition, and individual rights ought to waste our words making apologies for the kind of wage slavery offered by sweatshops.

The phrase “wage slavery” tends to really pique most free marketeers, who often object that the employer-employee relationship is one of simple voluntary agreement and contract.

A legitimate contract, however, assumes that relations, up until the point of “agreement,” have been absent of coercion and duress. But what if they haven’t? What if history has been a series of tragic and violent misadventures, a long list of appropriations, injustices, and other villainies carried out by the state to enrich a small ruling class?

Would we still want to defend sweatshops, or would we start to attack them on free market grounds? As William Bailie wrote, “Wage-slavery is merely the modern phase of chattel slavery.” Like the market anarchists of today, Bailie saw capitalism not as a process of advancement and development, but as an “economic retrogression” under which personal freedom had been retarded.

Market anarchists have more faith in freedom, entrepreneurship, and the sovereign individual than most self-described advocates of free enterprise. We don’t believe that, uninhibited by arbitrary restrictions like intellectual property law and given free access to common resources like the land, the people of developing countries would freely choose to work long hours for low pay under the most inhumane conditions.

Apologists for sweatshops tend to ignore the problem of land monopoly, as Murray Rothbard put it, the problem of “continuing seizure of landed property by aggressors.” Rothbard argued that the legitimate owners of land are “the true possessors,” rather than those “whose original and continuing claim to the land and its fruits has come from coercion and violence.”

The history of what is today regarded as the developing world, the site of most sweatshops, is marred by political land monopolization and theft that has driven wages down and rents up. Such deep political coercion has nothing to do with real free market principles.

One wonders whether “free market” defenders of sweatshops really do believe that we got to the current status quo using the free enterprise road, which would arguably make the economic conditions of today entirely defensible.

It may be that sweatshop defenders acknowledge the historical predicates of sweatshops while nevertheless seeing it as important to recognize sweatshops as the best alternative for the poor in the developing world. But no one really denies that fact on its own — on the contrary, market anarchists simply contend that these phenomena are unjust and untenable as they exist in the world today.

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