"Flush The Swoosh" Coalition Says Nike Sweatshops Tarnish U-M's Good Name
"Flush the Swoosh"
Coalition Says Nike Sweatshops Tarnish U-M's Good Name
by Robert Krzewinski
If a coalition of campus and community groups has its way their mid-October football-Saturday protest will mark the beginning of the end to U-M's multi-million dollar contract with Nike.
The morning of October 18 saw a small crowd of about 60 gathering on the U-M Diag for Ann Arbor's first Nike Action Day. The same day, similar "Just Don't Do It" protests took place at a number of other universities and communities in 28 states. The demonstration also had an international flare, with similar rallies in 13 countries worldwide.
Following the Diag rally, the "Just Don't Do It" campaign supporters marched to the U-M Stadium for the Iowa game chanting "N-I-K-E Out Of Our University" and "Nike, Just Don't Do It" to a crowd that had many thanking the marchers and only a few negative reactions (due in part to the protesters' intentional "Go-Blue" yet anti-Nike stance). While it could be effectively argued that the main thought of the crowd on October 18 was on the football game, many fans did not know about sweatshop allegations against Nike with demonstrators quickly running out of over 3,000 flyers.
Local organizations endorsing and participating in the event included the Coalition of Asian Social Work Students, East Timor Action Coalition, Huron Valley/Student Greens, Women's International League for Peace and Freedom, Solidarity, United Food and Commercial Workers Local 951, ARA/Free Mumia Coalition and the Vietnamese Student Association.
Also at the game was a small contingent of pro-Nike supporters who were supervised by a paid U-M/Nike campus representative. While media coverage of the demonstration was non-existent (s situation critics say is common given that TV and the press do not want to jeopardize Nike advertising accounts), anti-Nike demonstrators were repeatedly filmed and interviewed by a camera crew from Oregon that would not reveal who they worked for.
Diag Discontent
A number of speakers at the Diag rally condemned the sweatshop labor practices of Nike and demanded that they U-M suspend its contract with Nike. The coalition's petitions and flyers pointed out that the Nike formula for success was simple: Find the cheapest labor source you can, employ workers at substandard wages for long hours and then sell the product to the youth of developed nations through celebrity endorsements, rebellious-sounding slogans and slick merchandising campaigns.
On the U-M/Nike contract, speakers cited a growing outrage that a public institution of higher learning would allow itself to become subservient to the advertising needs fo a company that is well known for its unfair labor practices and human rights abuses. What was even more bothersome to a number of Nike Day participants was the fact that the University of Michigan would let its good name be used for the sake of making money.
Speaking to the small group assembled at the steps of the Graduate Library, U-M Prof. of Philosophy Eric Lowmond cited Nike labor practices that echo strongly of labor abuses seen in the U.S. earlier in the century, especially in coal mines. Lowmond pointed out that Nike factories, like coal mines, are often located in remote areas where the employer becomes the dominant force in the local economy. Workers find that what little money they make can only realistically be spent at "company" stores as travel to other locations is costly and almost impossible when a person is working 12 hours a day, seven days a week. Working conditions are so brutal that nearly three-quarters of the workforce leave after a year, only to be replaced with new, younger workers. And when a workplace becomes too expensive to operate or labor problems arise, Lowmond said, the owners pack up and move on to a new location.
The U-M Connection
In 1994 Nike entered into a six-year contract with the University of Michigan that, in exchange for shoes, uniforms, scholarships and monetary donations, requires team members, staff and coaches in 23 sports to wear Nike products at all games and practice sessions. Similar contracts are in effect at eleven other universities while 250 colleges and over 100 high schools have entered merchandising agreements with Nike.
For Nike, the U-M contract allows it to receive massive product exposure (just try and not see the Nike "swoosh" symbol around campus), exclusive merchandising rights, U-M coach endorsement rights, advertising space on U-M property, sports events tickets and a host of other benefits. The U-M/Nike contract also provides for a number of women's sports scholarships and two journalism scholarships. While critics have called the women's sports scholarships an advertising ploy to simply increase Nike's sales to women, on the matter of journalism scholarships Nike is more blunt. A Nike spokesman has stated that the company may very well be interested in hiring those receiving journalism scholarships and along those lines Nike is a fully vested participant in the selection process.
It is estimated that the U-M Athletic department alone receives $7.8 million a year in sports shoes and apparel from Nike. Like the scholarships and other donations, almost all are tax deductible to Nike. Concerning student demands that the U-M end its association with Nike, Keith Molin from the U-M Athletic Department informed AGENDA that the University has no response and that students are free to make statements about the relationship the University has with Nike.
"Just Don't Do It Campaign" Gaining Momentum
While the slogan of Nike--"Just Do It"-- is meant to denote feelings of ability and personal power, this small but energetic local protest appears to be part of a rapidly growing worldwide human and labor rights grassroots effort that is trying to throw the phrase back in the face of the shoe and apparel manufacturer.
The "Just Don't Do It Campaign" is demanding that Nike pay its workers a living wage, promote working conditions consistent with human rights, allow workers the freedom to join a union and engage in collective bargaining, allow independent monitoring by local human rights groups and allow the redress of claims by workers fired for protesting working conditions. And to consumers, whatever their age, the Campaign simply asks whether it is really cool or trendy for people to wear a product that was made by someone working over 80 hours a week in a sweatshop, earning a wage that doesn't allow that person to feed, clothe or shelter themselves or their family properly?
A few days following the October demonstrations, the Campaign For Labor Rights (the U.S. coordinator for the anti-Nike mobilization) reported a hugely successful event. While traditional protests took place in most locations, a group in New York City organized a return of shoes to a Nike store, a fourth-grade class in New Jersey presented a play on sweatshops and students at the University of Denver held a raffle where ticket prices were $1.60 (the daily Nike wages in Vietnam) with the winner receiving $2.10 (the price of three square meals in Vietnam).
The scope of action reportedly had Nike scrambling to contain negative publicity, with the company holding press conferences, conference calls, meetings with the media (including the Michigan Daily) and placing advertisements in college papers. Campaign For Labor Rights spokesman Trim Bissell remarked that Nike knows (see next page)
[PHOTO: Oct. 18: Anti-Nike demonstrators on the march from the U-M Diag to the Michigan football stadium. Photo by Ted Sylvester].
(see next page)
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it has a huge problem on its hands concerning sweatshop labor but is attempting to fix the situation the same way they sell shoes, through public relations maneuvers.
To Bissell, a very welcome outcome of the October 18 Nike protests was the networking that took place to plan for further action. Finding much in common, student activists from 10 campuses where Nike has a vested interest are working together more closely than ever. Anti-Nike activists have sworn to take the campaign to "the next higher lever" with increased local actions and another worldwide Nike Action Day in the spring of 1998. The Campaign For Labor Rights is also finding that due to the publicity of the October event, demands are rising significantly for information about Nike from groups previously uninvolved.
Locally, U-M Nike Action Day organizer Eric Dirnbach was very happy with the outcome of the day's events, as up to only a few months ago many on campus thought Nike's labor practices to be non-issue. Dirnbach pointed out that with a whole new school year starting, many students are not aware of the Nike sweatshop allegations or the relationship the U-M has with the shoemaker, so awareness-building will be a key factor in future actions.
Vada Manager, a Nike public relations staffer, told AGENDA that Nike believes it is a leader in fair labor practices and feels its relationship with universities is very beneficial to all parties. At the same time, Manager expressed concerns about the negative campus publicity it is receiving and said Nike has initiated a vigorous meeting schedule with college administrators, university groups and college groups. And for those in administration, Nike is inviting university managers to visit its overseas operations.
Nike's Track Record
In what appears to be a classic American success story, a young college student and track star, Phil Knight, wrote a graduate paper on how a company could succeed by importing Asian-made sneakers. In 1964 Phil Knight began to take action on his dream by joining with a former track coach and actually distributing Japanese-made athletic shoes. From these small beginnings in the 1960s, Nike has grown to become the world's largest shoe company.
From a business sense, Phil Knight seems to have never forgotten the plan he thought up in college. While Nike keeps its corporate offices in Beaverton, Oregon, it produces over 99% of its footwear in Asia by a workforce of over 75,000. Nike at one time did have U.S. factories but these were closed in the early 1980s putting over 2,000 workers on the street. Justification for the end of U.S. Nike production was, according to Phil Knight, that workers in this country were not interested in making shoes.
In Asia, however, Nike seemed to continually find a labor force that was almost limitless in number, cheap beyond belief and due to the help of their respective governments, relatively free from labor strife. Nike was first attracted to South Korea and Taiwan, but as workers in these two countries started to organize into unions and demand better treatment, Nike decided to take advantage of improved trade relations with more authoritarian governments and moved its subcontracting facilities to China, Indonesia, Bangladesh, Haiti and more recently Vietnam.
Like Taiwan and South Korea earlier, Indonesia has started to become a headache for Nike. In the past the government of Indonesia, given its record of brutal human and labor rights abuse, could keep dissident workers under easy control. Such government dominations, plus the attraction of extremely low production costs enticed Nike to place so much faith in Indonesia that currently about 36% of its shoe production takes place in that country.
Despite the consequences they face, Nike workers in Indonesia are sending the message that their time has come. With a minimum wage of less than $2.50 a day (not enough to meet basic food, clothing and shelter needs), mandatory overtime (against the law but commonly overlooked), rampant employee physical abuse and even child labor, things would seem bad enough for the workers of Indonesia. Yet on top of pure workplace problems there are also factors of the military suppression of strikes, the jailing of union activists, army personnel at factories to "keep the peace" and the legislature continuously passing laws to erode employee rights.
Nike claims that it is a model employer in Indonesia, pointing out free housing, medical care and pensions. Researchers have found that the free housing is only available to about 40% of the workforce, the free medical care is one doctor several hours a day for 7,000 workers, and the pension is $2 a week paid into a fund with extremely lax oversight. Worker response to the Nike practices has been to call marches and strikes. Indonesian Nobel Peace prize winner Dr. Jose Ramos-Horta, commenting on how the company has violated its own code of conduct and its treatment of workers, has called Nike and enemy of Indonesia.
With so much discontent within Indonesia, Nike management has begun to make statements that they workers there may be "pricing themselves out of the market." Nike has also recently announced that they will cut links with four of its Indonesian subcontractors who violated the Nike code of conduct by not paying the minimum wage. To critics, such actions by Nike indicate that the company may be looking for a way out of Indonesia and using employee unrest as an excuse. At the same time it is pointed out that the government of Indonesia has a vested interest in keeping Nike and a host of other foreign companies in their country and indications are the regime there may step up their actions to keep workers under control and investors happy. Along these lines the Indonesian legislature is currently debating a "Manpower Bill" that would place unions under the control of the government, requiring government permission before a strike action is taken and denying any collective bargaining rights to unions.
China, the other cornerstone of Nike production, also has its worker problems. According to a report by two Hong Kong Christian Industrial Committee, Nike factories consistently violate China's wage laws. The study documented conditions at four Nike factories on the China mainland and found that workers are paid as little as 15 cents an hour (the minimum wage is 25 cents an hour) and required to work 73 hours a week (44 hours is the legal limit) plus put in an additional2-5 hours of overtime a day. Workers refusing overtime can have a day's pay taken away. Researchers found children as young as 13 working on sewing and cutting jobs that could result in mangled or lost fingers. Pregnant workers were routinely fired (Chinese law requires maternity leave) and women over the age of 25 are dismissed as being "too old."
Things are not so rosy for labor in other countries where Nike subcontracts. In July a Bangladesh newspaper reported that nine people were jailed, 97 fired, 300 injured and another 800 charged with criminal offenses after workers tried to present a statement protesting factory conditions to a Nike subcontractor. Bangladesh police attacked the workers before they even had a chance to make their demands known.
Another Nike subcontractor, the H.H. Cutler Company (who shut down its operations in Grand Rapids years ago), recently closed its factory in Haiti due to criticism of the company's labor practices there, such as paying workers 30 cents an hour.
In Vietnam, women at a Nike factory who did not wear regulation shoes to work were made to run around the factory in the hot sun, supervisors not allowing them to stop until a dozen had collapsed. Nike has even had problems in Canada after buying out the Bauer Skate Company and promising not to displace any of Bauer's 400-person unionized workforce in Cambridge, Ontario. Early in 1997 the Bauer Cambridge workers learned that their jobs were being outsourced to Asia.
Overall at Nike, growth and profits remain fantastically healthy. In 1995 Nike posted a net profit of $400 million. With cheap production costs (selling shoes for $90 that have a labor cost of $1.20) Nike continues to fuel its growth through massive advertising campaigns, spending $250 million in 1994 alone for such activity. Sports celebrity endorsements are a vital part of the "Just Dot It" campaign with the most prominent Nike spokesman being Michael Jordan ($20 million a year), Andre Agassi ($190 million over 10 years) and now Tiger Woods (a recently penned $45 million deal). Nike CEO Phil Knight has been a member of the Forbes top 400 richest people list since 1982 and in 1997 was number 17 with a net worth of $5.4 billion. Yet with all the success and growth, Nike continues to attract attention that it doesn't want.
Trouble in Niketown
In September Nike held its annual shareholder meeting in Portland, Oregon, close to its corporate headquarters, which itself is know as "Niketown." To many attending the meeting, it appeared that Nike management was entirely on the defensive, doing all it could to counter the bad press the company was receiving. Nike executives repeatedly denounced charges of exploiting workers and engaging in sweatshop activity by accusing those making the charges as "extremist groups" that were telling "lies." And while 1996 brought Nike a 44% increase in net profits, warnings were given by management to stockholders that domestic U.S. sales were "flattening out" in large part due to the negative press Nike was receiving.
To increase sales, Nike told the audience it would start to concentrate on women and the "emerging markets of Asia." Shortly after the marketing announcement, shareholders were shown new commercials by Spike Lee, the first showing Asian women in Nike apparel, running and sweating profusely. Across the screen the words were "I dream of freedom." A second commercial showed images of Asians injured or grunting on athletic fields. This time the message flashed that "Pain is part of the process."
Shareholders again heard of the much-publicized, company-sponsored "independent" investigation of Nike's Asian workplaces by former U.N. Ambassador Andrew Young. In his final report, Young stated that while he saw some worker abuse, there was nothing systematic and nothing like he had been led to expect. Critics of the Young report called the inspection trip a sham and a pre-arranged guided tour with the inspection not even touching the issues of sustainable wages, forced overtime or hazards in the workplace. Reportedly Young spent 3-4 hours at each factory he inspected and language translations were done through a Nike interpreter.
Nike also reminded everyone that it created the first "code of ethics" (a document critics say is routinely violated) in the sporting goods industry and how it is a founding member of President Clinton's Apparel Industry Partnership, a group of trade unions, religious and human rights groups (a group that has yet to issue a report and whose members have serious disagreements over independent monitoring of working conditions and wages).
As the stockholder meeting went on, Nike management continued to assure those listening that Nike workers were happy workers. Nike founder Phil Knight exclaimed that he could hardly believe that the company had to repeatedly deal with the issue of foreign factory relations. "Good shoes are made in good factories," Knight said, adding that "Of course we treat our workers well."
Who to Believe?
Flyers distributed by Nike at the U-M football game emphasize that when the company enters a country, wages increase and poverty decreases, and how it strives to provide the dignity and respect workers deserve. Nike even attempts a little self-derogatory ribbing stating that "Hey, we're not perfect. Like every determined athlete we occasionally stumble," then reminds us again that Nike can and will do better when it comes to the treatment of its workers.
But in Forbes Magazine, a different side of Nike comes out. Speaking about allegations of Nike sweatshop labor practices, CEO Knight states: "This isn't even an issue that should be on the political agenda today. It's just a sound bite of globalization."
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CONTACTS:
Campaign For Labor Rights, 1247 E Street SE, Washington, D.C. 20003;
(541) 344-5410;
www.compugraph.com/cir;
e-mail: cir@igc.apc.org
U-M Just Don't Do It Campaign, c/o
Eric Dirnbach, 313/997-0946;
e-mail:nikerights@umich.edu
Nike, One Bowerman Drive,
Beaverton, OR 97005-6453
(800) 344-6453;
www.nikeworkers.com