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Economic Disneyland

By Stephen Brookes in Yangon, for Asia Times

mickey.jpg The New York-based National Labor Committee lashed out this week at the Disney corporation, accusing it of "exploiting workers in a multitude of countries" and vowing to expand its pressure on Disney's suppliers in Haiti to include those in Asia -- most notably in Myanmar.

"By focusing solely on Disney operations in Haiti," the group said on October 12, "NLC ran the considerable risk that Disney management would be tempted to cut-and-run from Haiti.  The decision to expand the focus of the Disney campaign adds a measure of safety to Disney's Haitian workers.  Disney management should now understand that Disney cannot escape the heat by pulling out of Haiti."

Conversely, however, the group then demanded that Disney and other U.S.-based apparel companies "pull all of their operations out of Burma", as part of an international economic boycott of the military regime there. (Burma is the former name for Myanmar.)

In other words: Disney should stay in Haiti because pulling out would cost workers their jobs, but it should "cut and run" from Myanmar even if it puts thousands of people out of work.

The inconsistent approach, say some observers in Yangon, underscores a key truth about the call for sanctions.

... "myanmar has become the fashionable place to boycott" ...

"Myanmar has become a whipping boy for the world's human rights campaigners," said one businessman. "Things are much worse in countries like China and everybody knows it. But Myanmar has become the fashionable place to boycott. People who couldn't find it on a map want to slap sanctions on it."

The State Law and Order Restoration Council (SLORC) that rules Myanmar has come under harsh attack from labor and human rights groups, and pro-democracy leader Aung San Suu Kyi has called for an international economic boycott against the country.

But domestic and foreign garment manufacturers in Myanmar, who employ some 50,000 people in Yangon alone, are disturbed by what they see as a strategy that could create long-term damage in the economy and hurt the people who are most in need.

"We have 3,600 workers who are dependent on us, and it's my responsibility to find the buyers so they can keep working", said the owner of the company which has been making the American Character Classics clothes for Disney in Myanmar. "We don't want to lay anybody off. So we'll just have to find new buyers to replace Disney."

But will sanctions improve the situation in Myanmar? It's instructive to look at the case of Haiti, where the international community imposed an economic embargo after Jean-Bertrand Aristide was deposed in a 1991 military coup.

The similarities between the two countries are striking. Both Aristide and Suu Kyi are highly charismatic figures who won overwhelming victories in democratic elections. Both enjoyed massive popular support among their nations' poor. Both were supplanted by military regimes and exiled -- Aristide to Washington, Suu Kyi to house arrest. Both lacked economic training, and were hostile towards the business community. And both called for the international community to impose economic sanctions against their own countries in order to bring them into power.

Did the sanctions work in Haiti? Clearly not. Despite three years of an almost total embargo, Aristide was only able to return to Haiti when the United States brought him back in a military operation. And when he returned, it was to an economy that was in large part ruined, while the military leaders -- the targets of the boycott -- retired in luxury.

As Christopher Caldwell wrote in an article on Haiti two years ago in The American Spectator, prior to Aristide's return: "The sanctions do not harm the army at all -- if anything, they foster a new and necessary contraband mafia, which the army takes part in and taxes. And in the name of saving lives, the embargo kills Haitians at the rate of at least a thousand a month, according to research by the Harvard Center for Population and Development Studies."

Moreover, the country's export-oriented light manufacturing sector -- much of it in garments -- was essentially destroyed by the embargo. The number of industrial jobs fell from more than 150,000 in 1990 to fewer than 10,000 by 1995, and most of those losses came as foreign companies, including 200 from the United States, left as a result of the embargo. They went to Guatemala, Honduras and other developing countries. And when they left, the jobs left, too -- many of them for good.

Neither did Aristide's 1994 return bolster the country's economy. Despite massive infusions of aid, policymaking virtually ground to a halt as squabbles broke out in the disorganized, fledgling goverment. The planned privatization of Haiti's nine state enterprises stalled, the ruling Organisation Politique Lavalas has been unable to disburse aid effectively, and corruption is said to be rampant. Arguments over economic policy finally led to the resignation of the prime minister, Smarck Michel, in October 1995.

In fact, the lack of commitment to economic reform has dampened aid from international organizations, and urgently-needed private foreign investment is only coming back slowly. Unemployment is running at a brutal 80 percent. And Aristide's successor, Rene Preval, admitted at his inauguration that Haiti was on the brink of bankruptcy as a result of corrupt public officials and low tax returns.
 
The lessons of Haiti might well be applied to the case of Myanmar, as the threat of sanctions increases. Having failed to restore democracy -- while creating a severely damaged economy -- would sanctions have a different effect in Myanmar?

"The problem is that the SLORC is not going to bow to pressure," said one analyst. "They're a military government -- they'll put the country on a war footing if they have to. And Suu Kyi is intransigent in her opposition to investment. The standoff could continue for years. So the question is, what happens to the people if the country becomes an economic battleground? But no one seem to be thinking that far ahead."

(Asia Times, October 19, 1996) 

Posted on Friday, July 27, 2007 at 12:24PM by Registered CommenterStephen Brookes | CommentsPost a Comment

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