Labor markets in the American South and China are starting to look the same

The New York Times just published a piece on Chinese investors opening up textile mills in the American South.

Once the epitome of cheap mass manufacturing, textile producers from formerly low-cost nations are starting to set up shop in America. It is part of a blurring of once seemingly clear-cut boundaries between high- and low-cost manufacturing nations that few would have predicted a decade ago.

Textile production in China is becoming increasingly unprofitable after years of rising wages, higher energy bills and mounting logistical costs, as well as new government quotas on the import of cotton.

At the same time, manufacturing costs in the United States are becoming more competitive. In Lancaster County, where Indian Land is located, Keer has found residents desperate for work, even at depressed wages, as well as access to cheap and abundant land and energy and heavily subsidized cotton.

A few thoughts:

  1. The slow return of manufacturing to the United States probably has a lot to do with the general stagnation and regression of states in the South, whose far-right governments have dismantled what little social safety nets there might have been, and have been steadily increasing the power and privilege of capital over that of the rest of society.
  2. The fact that cotton is subsidized in the US is mentioned as a key factor–does that mean that the US government is effectively subsidizing capital accumulation for Chinese companies?  This raises some interesting questions about the power of rural farming constituencies and how their interests are convergent with that of global capital.
  3. It is important to understand the “rising wages” and the “logistical costs” mentioned in the NYT piece that is driving capital out of China as being fundamentally linked with the escalating labor struggle in China that has developed over the past decade or so; Eli Friedman’s piece “China in Revolt” in Jacobin Magazine does a great job illustrating this.
  4. All this appears to be part of a larger, slow process of the “flattening” of global labor markets by global capital that is starting to upend common conceptual frameworks of  core/periphery, North/South, etc.  The NYT piece also mentions FDI in the US textile industry coming in from India and Brazil; its also worth noting that British steel workers were close to holding a strike a few weeks ago against Tata Steel, part of a massive Indian multinational conglomerate.
  5. Increasing FDI from Asia into the US will likely spark racist backlash against Asians, and thus it will become increasingly important for racial solidarity and class struggle to be emphasized as the alternative, positive way to react toward what is seen as “foreign exploitation”

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