Slavery – abolished or reinvented?
21 February 2010 at 02:28 Anna 15 comments
Anna Cleal, KF10, Philippines
Is exploitation just another form of slavery? This question has crossed my mind a few times today.
The borrower I just visited (who will remain anon) uses her loan to buy materials to make a product.
After a fair bit of questioning and digging. Here’s the dirt.
- The product she makes costs around $1.50USD in materials PLUS 7 hours of labour time.
- She sells each item for $2.50 – which translates to a profit of $1 per item sold.
- She ALWAYS sells her goods as there is ALWAYS a demand.
THE QUESTION THEN IS …Why doesn’t she sell these items for more than $1?
Unfortunately, the answer is that she can’t. This lady has little control over the income from her work. She is limited by the fact that;
- She can make a maximum of 7 items per week (1 item/day)
- The person who sells her the material is THE SAME person who buys and exports the product. They enforce a maximum of 120PhP ($2.50) for the finished item otherwise she won’t receive materials in the future. On the local market she knows her product is worth 500Php.
I don’t know about you, but to me this sounds like exploitation of labour. This lady is earning around 15cents/hour, $1/day. Minimum wage in this part of the country is around $5/day.
So let us consider how free she really is. Does she have the ability to increase her profits over time? No. Does she have the ability to increase her production? No. Is she earning less than minimum wage? Yes. Is her cousin employed in the same industry? Yes. Are there others like them? Of course. Where are these products going? Overseas. What are they sold for overseas? I don’t know – but I can guess that is more than $2.50. Is she a “slave” to this system? I think so. What are her chances to improve her living conditions, and the living conditions of her four children? Slim to none.
So where does the one buck stop? I guess I’m throwing this question at anyone who cares about a filipino lady who lives in a small house, in a small village, on a small island – a lady inevitably like many others around the world.
Entry filed under: All, Countries, East Asia & the Pacific (EAP), KF10 (Kiva Fellows 10th Class), Kiva Team, Philippines. Tags: exploitation, kf10, Kiva, microfinance, minimum wage.
1. msoneale | 5 October 2010 at 04:49
she needs internat access, to find other suppliers in the phillipines for materials so she can bypass this vampire. She will have control over her pricing. She is a slave.Then kiva loans will help her avoid slavery. She can spread the news to others in her position. Soon he will be left alone to count his dwindling profits.
2. Meg in Nelson | 12 March 2010 at 14:37
Very naively, I somehow convinced myself that by participating in such schemes as Kiva, we were protecting “the weak”, particularly women, from such mechanisms. I wonder if Kiva Partners are in the position to do something, or if they are in cahoots with these cycles.
3. Raf Manji | 8 March 2010 at 15:28
Speak to farmers and you might find they get the same treatment from the supermarkets! The power of the retailer/wholesaler to set prices to the manufacturer has always been a problem. Normally competition takes care of that but in many market unofficial cartels and price fixing is rife.
Ultimately either regulators or consumers of the end product can intervene but it’s not always easy. Ethical branding via Fair Trade labels can help but there is always likely to be this type of behaviour in any market especially one where visibility and transparency is low.
Sunlight is always the best disinfectant so more stories like can only help.
4. Anna | 1 March 2010 at 23:50
Hi all,
I’d like to draw your attention to this borrower journal (at the bottom of the page) http://partners.kiva.org/lend/143297. This is an example where microfinance can be a ticket out of exploitation. I will be spending the day with the borrower mentioned in the article above this weekend to find out more details. Unfortunately she currently has no way to source the material directly. She lives in an isolated area without access to communication. I will do a follow up blog on this story so stay tuned.
PS agreed the word slavery is a serious one to throw around however I wanted to provoke interest in the issue that I believe is also very serious.
5. Peter | 23 February 2010 at 05:39
It seems to me that unless the supplier/buyer is using intimidation to squelch competition than the facts are thus: if someone could sell materials to this woman for less than $1.50, they would; if someone could buy the finished item for more than $2.50, transport it to market, sell it and make a profit, they would (in both cases they would quickly take business from the current supplier/buyer); if the obstacle to competition in either buying in bulk or transporting for sale is start-up capital, then it seems like a perfect oportunity for a micro loan to the woman or a third party; It is also possible that it simply costs $10.00 to get the things to market and $1.50 to get the materials to the woman. If the supplier/buyer wasn’t serving as a middle man, would the woman be earning $0.00 per day?
6. Jacob Schwartz | 22 February 2010 at 15:04
Maybe she could sell on Etsy, or Ebay.
7. selot | 22 February 2010 at 12:20
Hi Anna
Semantics aside the crux of the problem is freedom of choice – or rather lack of. So how can programmes like Kiva position people in poverty to gain control of their own future? Unfortunately there isn’t a one size fits all solution. At an international level fair trade schemes have started the huge task of moderating supply chains to ensure fairness to all involved in the supply of a product. But these schemes are few and far between and many of these women are part of smaller local supply chains. So how can we help this woman and other individuals like her? Can we find her another material supplier? Is there a market she can sell directly to and so cut out the middle man? Can we gain bargaining power through a union-type group or collective (careful to avoid undercutting by other independents). It’s a big challenge Anna!
8. Page not found « Kiva Stories from the Field | 22 February 2010 at 04:17
[...] Posts Slavery – abolished or reinvented?The Case of the Faceless LenderPains and pleasures of Kiva’s P2P [...]
9. marydear | 21 February 2010 at 18:48
thanks for your post Anna – middlemen can really well, really Suck! It happens here is Cambodia too, where the women buy raw materials from Vietnam at a high price for silk weaving – every woman you talk to it’s the same price!
I hope with more education this will lessen and eventually stop.
10. Melisa | 21 February 2010 at 08:50
Hi Anna,
Thanks so much for your concern for this Filipino lady. She is not alone in her plight. The reality is that such greedy and oppressive system is being practiced throughout the country at the expense of the poor workers.
I believe that slavery in whatever form has never been abolished. As long as there are greedy, indifferent people who would take advantage of those who are uneducated and uninformed and underprivileged and indigent people, slavery will remain a deep-seated social problem, esp. in third-world countries.
I agree and hope with Jan, that microfinance would give these people another option to free themselves from such oppression.
11. Jan & John, KivaFriends | 21 February 2010 at 08:28
Wasn’t that the way Muhammad Yunus started in Bangladesh… by ‘freeing’ some women from their suppliers/middlemen/loan sharks? I always hoped that microfinance would, at the very least, give these women another optiion and a chance to find their way to freedom from oppression. jan
12. josh | 21 February 2010 at 06:32
p.s. I know Slavery is a very emotive subject and I wouldn´t suggest, for a minute, that an individual´s experience 400 years ago is the same as people´s experiences today (although for many it can be).
But, in terms of the practice of restricting a persons freedom, forced relocation & huge inequalities in standard of living, I think the comparison stands.
13. josh | 21 February 2010 at 06:28
just a thought, related to your question.
I think Debt is slavery, whether it be international, national or personal.
If your friend doesn´t work, I guess she´ll quickly become indebted & if her freedom to work is restricted as you mention, then I suppose she is somewhere along that process.
The Irish were indentured labour, debt slaves, before the mass exploitation of African labour.
After Imperialism and then colonialism become untenable, forcing nations into debt quite successfully continued the practice of maintaining the inexcusable inequality that ensures those very few have a massively disproportionate standard of living to those very many.
Although your question may not be academically correct, in spirit i think you´ve hit the nail on the head.
Thankfully, & hopefully, we are on a road to a better place, that other world that IS possible, as evidenced by Kiva and countless other initiatives that progress through the unending optimism and work of people who know right from wrong without need to reference academia.
14. Jeff | 21 February 2010 at 05:59
Is exploitation just another form of slavery? No, let’s not water down slavery. A slave is owned. As far as I can tell, this woman is free.
She is limited by the fact that;
* She can make a maximum of 7 items per week (1 item/day)
* The person who sells her the material is THE SAME person who buys and exports the product.
To me, she is limited by the fact that there are many other people who are willing to do this work for $1 a day. If she says no, someone will step into her place. That’s the problem.
15. Gardenbug | 21 February 2010 at 05:57
If she could buy her material elsewhere, can she operate independently? Can she be an independent business?