How Nike came to embody the good and bad of Obama's free-trade push

President Obama went to Nike Friday to exhort Congress to pass trade legislation. But fair-labor advocates say Nike is a poster child for the pitfalls of free-trade deals.

|
Jonathan Ernst/Reuters
President Obama delivers remarks on trade at Nike corporate headquarters in Beaverton, Ore., Friday. Mr. Obama pressed fellow Democrats to support his push for a trade deal with Asian countries.

The Friday before Congress takes up trade legislation that President Obama dearly wants, he decided to make his case at the Beaverton, Ore., headquarters of Nike.

He could hardly have chosen a place that speaks more compellingly both to the promise of the Trans-Pacific Partnership (TPP) and to its potential pitfalls.

In an attempt to assuage fears that the TPP would send more jobs overseas, Mr. Obama highlighted that Nike is promising to create up to 10,000 United States-based manufacturing jobs if Congress passes the pact. That is just a taste of the benefits that the agreement will deliver to America and the world by lowering import tariffs, opening new markets to exports, and providing a means to compete with China, he said.

But for years, fair-labor advocates have held up the company as a poster child for why free-trade deals such as the TPP hurt America. They outsource jobs to low-income foreign workers where labor rights are scarce. 

"It's almost like throwing people a curve ball – why would you ever go there given their reputation?" said Richard Locke, a professor at Brown University in Providence, R.I., who studies labor and environmental conditions in global supply chains and has been a Nike observer for years, in an interview with CBS News.

But Professor Locke also pointed out that Nike represents the potential for companies to reform.

"Nike has really worked hard [since the 1990s] in improving its environmental and labor conditions among its suppliers," Locke said.

After signing an agreement with Oregon to hire at least 500 full-time-equivalent employees by the end of 2016, Nike exceeded expectations by creating more than 2,000 Oregon-based jobs, The Oregonian reported in October.

Currently, the company says it employs 8,500 workers in Oregon and brings an economic impact of over $2.5 billion a year.

Nike and the Obama administration argue that the trade pact would save companies like Nike money, allowing them to invest in innovation, further develop manufacturing methods, and increase profits that would ultimately benefit the US economy. Aside from the 10,000 manufacturing jobs, the accord would create thousands of new construction jobs and more than 40,000 indirect jobs with suppliers and service providers during the next decade.

But critics argue that while the TPP may leave some jobs in the US for those with advanced degrees such as designers and product engineers, the majority of the low-skilled manufacturing jobs would go overseas.

"Nike epitomizes why disastrous unfettered free-trade policies during the past four decades have failed American workers, eroded our manufacturing base and increased income and wealth inequality in this country," Sen. Bernie Sanders (I) of Vermont, who recently launched a campaign for the Democratic 2016 presidential nomination, wrote to Obama in a letter this week.

Although Nike employs about 26,000 people in the United States, its contract factories overseas employ around one million people, roughly a third of them in Vietnam, The New York Times reported.

"Why would the president honor a firm that has grown and profited not by creating American jobs, but by producing in offshore sweatshops with rock-bottom wages and terrible labor conditions?" Lori Wallach, head of the consumer advocacy group Public Citizen's Global Trade Watch, said to CNN.

Meanwhile, the Obama administration has attempted to reassure the president’s liberal base that the protection of labor rights will be included as core component of the trade pact.

“The trade deal that the president hopes to sign is one that is not only good for American workers, good for the American economy, but is one that includes the strongest, boldest human rights protections, labor protections and environmental protections we’ve seen in a trade deal,” Eric Schultz, a White House spokesman, told reporters on Air Force One during the flight to Portland, Ore., on Thursday.

But critics say that labor standards added to previous trade agreements, like the North American Free Trade Agreement (NAFTA), did not improve working conditions for workers abroad.

Josh Earnest, another White House spokesman, said the key difference between TPP and previous trade agreements is that the proposed deal contains provisions "that would actually be enforceable," CBS news reported.

Obama is pushing Congress to give him trade promotion authority, also known as “fast track,” which would obligate lawmakers to vote yes or no on a proposed deal without permitting amendments. Without such trade authority, many observers say it will be difficult to complete the negotiations on the TPP, which is opposed by most of the president’s fellow Democrats in Congress.

The TPP would be the largest trade pact the United States has joined in more than two decades. 

You've read  of  free articles. Subscribe to continue.
Real news can be honest, hopeful, credible, constructive.
What is the Monitor difference? Tackling the tough headlines – with humanity. Listening to sources – with respect. Seeing the story that others are missing by reporting what so often gets overlooked: the values that connect us. That’s Monitor reporting – news that changes how you see the world.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

QR Code to How Nike came to embody the good and bad of Obama's free-trade push
Read this article in
https://www.csmonitor.com/USA/USA-Update/2015/0508/How-Nike-came-to-embody-the-good-and-bad-of-Obama-s-free-trade-push
QR Code to Subscription page
Start your subscription today
https://www.csmonitor.com/subscribe