Azucar Amarga on Primer Impacto

[NALs]

Word of note:

Sugar prices can't really rise, because that would make them less competitive especially with the corn syrup deal that is coming into the local market. As such, the only way to increase wages is to fire a certain number of people (ie. unemployment goes up for those Haitians who would have starved to death in their own country-after all, that is why the come to the DR, because conditions are better here than in Haiti, otherwise they would leave at the end of the Zafra and never come back, but that is hardly the case).

In other words, if two Haitian works for 10 pesos a day and people want his salary to double, in order to maintain the competitivity of the sugar market what would happen is that one Haitian would be fired, the other would get paid 20 pesos now, but his work load would also increase. The only way his wage of 20 pesos could be kept without increasing his work load would be in investing in new technology.

However, new technology will displace the vast majority of cane cutters who would then be deported and starve in Haiti rather than earning something in the DR. For this example, lets assume there is a Bateye of 10 Haitians each earning 10 pesos. In order to comply to international pressures of increasing the wages, 5 Haitians will be fired so the other 5 can earn 20 pesos instead of 10. However, since international pressure in this example would also require for the Haitians to either maintain their current work load or for their work load to diminish without lowering their pay, then new technology would have to be implemented. In this example, let's say a machine that cuts sugar cane and a truck where the cut cane is automatically thrown by the other machine are brought. Suddenly, 3 of the 5 Haitians earning 20 pesos are unemployed because the new techonology makes it possible for only 2 Haitians to do the same work load in a much quicker and efficient manner that the previous 10 Haitians did manually. So, in the end, 2 Haitians are left employed each earning 45 pesos (because the wage is transfered from the 3 Haitians that were fired to the 2 Haitians left on the job).

Even though this is a very simplistic example, it gives a clear picture of the effects of increasing wages and/or decreasing work load by introducing new techonology. In this example, 10 Haitians each earning 10 pesos was cut down to 2 Haitians each earning 45 pesos and 8 Haitians are now unemployed earning 0 pesos and probably deported to Haiti where they will continue to starve to death.

I'm not giving my opinion on this subject, just expressing in a very simplistic form the economic effect a higher minimum wage and shorter work load could have for the vast majority of Haitians. A few will benefit extraordinarily (after all, going from 10 pesos to 45 pesos is more than a quadruple in income earned), but only 20% of Haitians in this example will benefit to such degree, the other 80% will be much much worst.

And, I must add, this is an example where the sugar estates try to protect their market share by maintaining the lowest possible costs so they can sell the sugar products at competitive prices. If the example would have been in order to protect the sugar companies employees (in this case the Haitians), then sugar products would cost more to produce and that means prices for sugar products would be higher and with the importation of Corn Syrup (which is incredibly cheap), sugar estates will go bankrupt and in the end, everybody in that industry would be unemployed and starving. The latter is not that pretty as you can see.

Also keep in mind, that if profit margins are forced to be lowered, that would cause many sugar estates to divert to other more profitable forms of businesses that could have either a positive or negative effect on the employees in the sugar industry. In other words, the incentive to keep the sugar industry alive is driven by profit margins, a lowering of such would create less interest and a desimation of such industry, this is true of all indusrties everywhere in the world.

Again, I am not proposing my point of view towards this issue, just presenting in a simplistic form the possible economic repercussion of higher wages and/or lower working load with the introduction of new technology in order to comply with international pressures.

BTW: Robert, is it possible to post graphs here? Every time I present an economic example, graph tend to help the average person see the effects much more clearly.

[Jon S.]

It's a never-ending cycle. The largest sugar producers in the DR are 'coincidentally' the largest sugar producers in the US and they don't want that to change or else you won't see any more Casa de Campo or the sugar cane fields right outside of the compound.....and all the sweets that we eat here in the US. I'm sure sugar makes more than the $75 million but I don't know the figures. There are no easy solutions to the situation but what do you propose, Nal0??? I already gave up on the DR becoming a better place due to the crap people do down there but there's a slight chance that some things might get better, maybe the sugar cane cutters is one of them.

[Chirimoya]

Saying it is better than starving in Haiti is not quite the point.

Most Haitian sugar workers are brought here on the basis of false promises, much like the DR women sex workers who are lured to Europe with promises of much more money and better conditions than they end up in. Some are even abducted.

Once they are in the bateyes, it is too late for them to do anything about this: they are stuck there. In the non-productive season they have to eat, so their only option is to run up debts at the company colmados, which they then have to work to repay during the harvest. Some places even pay in coupons only valid for those colmados, not cash.

The average income per capita in Haiti is about US$1 per day, three times more than RD$10. So even if a Haitian stays in Haiti and manages to earn half of the average income, s/he will be better off than someone working in the DR sugar fields.

It is true about world sugar prices and the effect of corn syrup, but hey, guys, you're the free market economists - doesn't this mean that the sugar companies should call it a day?

And yes, despite the campaigns on the behalf of Haitians in the DR, anyone with any power to do anything about it is looking the other way. Of course, as long as Dominicans go on employing them at slave wage level, this will continue. But patriotism takes a back seat when it comes to making a buck, no es cierto?

http://www.ciir.org/Templates/Internal.asp?NodeID=91169

[suarezn]

Nal0whs: You make very good points. Last time I went to The DR I had a long discussion about this topis with a lady that was flying in from Canada to work as a consultant for an organization called Batey Relief. She wanted to know more about this situation and we got into this long discussion. I was explaining to her pretty much the same thing that you just expressed here. The problem is a very complex one. It really sux that these people have to work for next to nothing. They should be paid minimun wages, but then the reality is just like you said; If this happened then a lot of these people would have no job at all.

Frankly, I'm surprised that these companies haven't replaced human labor with machinery. Every so often someone raises the flag on how these people are being exploited and these companies just weather the storm of bad publicity and continue to do the same thing they've been doing. If it was my company I probably would just use machines. That way I wouldn't have to deal with it, but apparently it's way cheaper to use humans.

Mirador: While I agree that the situation is reall ybad, I don't agree that this is slavery. As far as I understand it, they can leave any time they wish. Maybe it's a form of economic slavery, but not forced labor per se.

In the end we all find this to be despicable, but nobody ever does anything about it and we all bitch about the price of sugar or derivatives when they go up.

[Chirimoya]

Oh yes and I forgot to say: just one more reason not to eat any of the damned stuff, and avoid the things that are sweetened with it - as far as is possible.

[Stodgord]

[QUOTE=Nal0whs]Word of note:

Sugar prices can't really rise, because that would make them less competitive especially with the corn syrup deal that is coming into the local market. As such, the only way to increase wages is to fire a certain number of people (ie. unemployment goes up for those Haitians who would have starved to death in their own country-after all, that is why the come to the DR, because conditions are better here than in Haiti, otherwise they would leave at the end of the Zafra and never come back, but that is hardly the case).

I think you are missing the big issue. Last night report was about CHILD LABOR. On the report, I saw children up and about late in the night and at crack of dawn working the fields. There are children in their school uniforms working the field, meaning that they either go to school, if at all, after working the field in the morning or they come stray to the field after school. A kid's hand was messed up from cutting sugar cane all day long.

Companies will always complain that they will go bankrupt if they increase wages. This is their main defense, but companies that go belly up is because of mismanagement or embezzlement. If they Perhaps, attribute their lobbying money to paying higher wages, parents won't be forced to ask they kids to work the fields, thus possibly eliminating child labor.

[Marianopolita]

Mirador mentioned that this exploitation of Haitians in the sugar cane fields gives slavery a better name but in my opinion I think it's just an example of "organized modern day slavery". As many of you know I always like to go back to history because nine times out of ten current events are indicative of past events. Since the world organizations always seem to turn a blind eye to issues such as these ones unfortunately they will persist unless a modern day Fray Bartolomé de las Casas rises to the forefront because if it were not for his efforts who knows when slavery would have been abolished.


-Lesley D-

[Narcosis]

Originally Posted by Chirimoya

It is true about world sugar prices and the effect of corn syrup, but hey, guys, you're the free market economists - doesn't this mean that the sugar companies should call it a day?

Yes of course they should call it a day under a true free market, but exactly who should call it a day? Why is it that no one talks about the billions in tax Europeans and Americans pay to subsidize their sugar beat and corn growers to maintain an artificially low price? Who is the true bad guy here?

Why don't we compare wages with Chinese workers, how come we don't see anyone complaining about those "slave wages", in detriment to American and European blue collar workers? Hipocracy or double standards?

[stewart]

I agree that we need to sparate the child labor violations from the adult wage problems for the sake of discussion.
But what about machines? I have to assume they would be gas powered. Or diesel. At the cost of cas per callon, they get 10 laborers that will work all day. Not to mention the initial investment for the machines.
I disagree that if they rais wages, they would need to let other people goto compensate. I think the major consideration is protecting the land owners profit margin. I bet that they pay a handsom amount to police et al to look the other way on this. If they were less greedy, they could improve wages and conditions and still be profitable. Maybe not at the same level.
I have a hard time believeing that the margins are so thin that they couldn't go from 10 pesos to 20 a day.
I mentioned that the sugar industry generates 75 million dollars a year. That is the figure thrown out on Primer Impacto. I didn't question it.
THey also mentioned that sugar production is basically controlled by 2 of the wealthiest Dominican families. I can only assume that they are well connected and are very much in control of legislation, police rule and the ever important PR machine.

[NALs]

Originally Posted by Stodgord

I think you are missing the big issue. Last night report was about CHILD LABOR. On the report, I saw children up and about late in the night and at crack of dawn working the fields. There are children in their school uniforms working the field, meaning that they either go to school, if at all, after working the field in the morning or they come stray to the field after school. A kid's hand was messed up from cutting sugar cane all day long.

I don't want to get more involved in this conversation or debate, but I'll say this.

You compare many of the DR economic standings today and they are similar to those of the USA of the 1920s. With a few exceptions, the DR is a much smaller less powerful version of the 1920s version of the USA. As such, when anybody travels to the DR, they are really going back in time to the 1920s.

Hint: Child labor was alive and well in those time periods in the countries that were at the economic level in the 1920s that are comparables to the economic levels of the DR today.

Of course, I see your point. You guys want child labor to end and it is illegal by law. What I have posted here is just an observation from an economic stand point and in comparing and contrasting between a country (USA) that was in the 1920s at levels similar to the levels the DR is today, plus or minus a few differences.

Inequality is about the same, poverty rates are about the same, economic boom and busts in percentage wise are about the same, economic output per capita (GDP per capita) is about the same, etc etc etc.

People can't really treat a country that's some 85 years behind as if it was the epitamy of 21st century. I understand the concern presented here, but lets compare apples to apples in order to make an economically sound assesment of the issue. Sometimes what sounds and looks nice and sweet can turn to ugly and bitter.