Maquiladoras: Exploitation in the Global South

 

A distinctive feature of modern imperialism is how the core regions exploit the conditions of the periphery to extract as much value as possible. This value extracted in the Third World is then realized through profits of multinationals and high wages/living standards for the average First Worlder.

It’s important to understand that exploitation through the labor process does not take on the same form everywhere. The competitive exploitation that existed in the industrial revolution has given birth to the monopolist exploitation of today which divides the First World ‘knowledge economies’ from the Third World sweatshops; the division between the Global North and Global South.

For the monopolists of the Global North to maintain the incredible inequality with the Global South they have adopted models of production that give the highest rate of exploitation. One such model of exploitation can be found in the Free Trade Zones of Latin America: Maquiladoras.

The maquiladoras are sprawling manufacturing plants that primarily produce textiles but also create electronics, furniture, and even automobiles.

The reason maquiladoras have become the preferred model of exploitation used by the Global North stems from the sheer amount of surplus value able to be extracted from the workers. The average salary of a maquiladora laborer is 7 USD/day: up to but often less than 1.22 USD/hr for a normal 8-hour day (although workers often work well over 40 hours a week). Compare this to the average wage of an Amerikan manufacturing worker of the same productivity: 17.70 USD/hr. This allows  for an incredibly high rate of exploitation which is used to finance the lavish imperialist lifestyles in the core nations where the value is realized.

While the maquiladoras have existed since the  mid 1960′s as a Mexican Federal project to redevelop private industry along the border with the United States, the signing of NAFTA allowed a huge influx of privileged ‘foreign investment’. Companies like GM, Chrysler, and later clothing labels such as Hollister took advantage of the lucrative opportunity and the number of maquiladoras began to grown exponentially.

In 1996 there were about 2700 maquiladoras in Mexico and Central America, by 2001 that number had jumped to 3700. In the years before NAFTA maquiladora employment was growing rapidly at a rate of 47% per year; after NAFTA the rate exploded even further to 87% a year. Currently, almost 2 million Mexicans work in the maquiladoras along the US border although that number is misleading as maquiladoras suffer from about 80% employee turnover. Meaning possibly millions of other workers have worked in the maquiladoras but are simply not listed as having done so.

As the number of maquiladoras continues to grow more of the economy is becoming consumed by this model of exploitation. In 2004 products produced by maquiladoras in Mexico comprised 54% of exports to the United States. The following year maquiladora products made up more than half of all Mexican exports.

This trend can be observed in other parts of Latin America as well. Honduras, a largely non-industrialized country, has experienced a significant growth in the maquila industry. At least 14 maquila plants have been constructed in Honduras since 2010 which already account for 33% of Honduran GDP. The motion of capital also seems to be following a familiar pattern. While it’s true millions of dollars have been invested into Honduras by multinationals, employing thousands, 85% of maquiladora exports go to the United States. In addition, maquiladora exports consume 1.4bn USD in quarterly exports of a nation that only quarterly exports 1.6bn USD total.

Understanding all of this, it’s sickening some would suggest these maquiladoras enrich the laboring masses.

The monopolists of the Global North have tacitly accepted a few ‘mechanisms’ designed to check the rate of exploitation. One such measure is a Mexican labor statute ordering multinationals to share 10% of the maquiladora profits with the laborers. However, as with all reforms this only further legitimizes the deplorable conditions of the maquiladora workers and does little to benefit them. Because a worker has to meet certain conditions to qualify for the profit sharing, (such as being fully employed for over a year at place of employment) very few workers ever see a peso from this profit sharing scheme. Most of the profits ‘shared’ by the monopolists ends up back into Federal circulation where it ends up lubricating the trade between the maquiladoras and the core regions.

So while various mechanisms exist to try to ‘protect’ the maquiladora laborer, all fall short of even budging his material conditions. Several decades after the installment of these ‘export models’ the conditions of the average Mexican laborer are still deplorable. The Mexican people have had to experience all the negative effects of industrialization without almost no increase in material well being. The industrialization of the semi-periphery such as Mexico serves only the interests of the monopolists in the core regions. This industrialization designed to  ‘develop the domestic economy’ will never do so. The incredible amount of value being sucked of Mexico by the imperialists will never allow a prosperous or self-determined working class in Mexico. Under imperialist-capitalism these laborers will only remain cogs in the system; alienated from the product of their labor and the labor process itself.

The horrible conditions of the maquiladoras and their proximity to the US border has contributed to a rising number of undocumented laborers in the US.

Without spending too much time on the issue of immigration its important to note the series of contradictions created by the Global North’s model of exploitation. Tens of thousands of maquiladora workers have crossed the border to the north to try to escape the terrible conditions of this ‘domestic development’. The conservative and reactionary forces of the First World cry foul citing “illegal immigration” and mulling about nationalism. Even the so called “left” has encouraged economist policies that legitimize the oppression of the Global South. When the First Worlder cries about nationalism and “illegal immigration” he is actually trying to defend his privilege from the inevitable expropriation and solvency of the contradiction between the Global North and South; a contradiction that his privilege necessitates. Even the “left” and “socialists” in Amerika often find themselves pandering to the right-wing ‘white proletariat’. They encourage economism by pinning stagnating wages on superexploited migrant workers.

As communists we must support the international proletariat, not the national ‘proletarians’. Proletarian internationalism and the dedication to global people’s struggle must come above national chauvinism or bourgeois individualism.

What the maquiladoras illustrate is the exploitative and parasitic relationship between the Global North and South; how the core continually manipulates the conditions of the periphery to maintain its own status. Understanding this relationship and the subsequent processes helps us determine the class nature of the international politics, identifying exploiter from exploited, as well discerning the antagonistic contradictions between the First and Third Worlds.

References:

http://www.mcclatchydc.com/2012/06/17/152220/mexicos-maquiladora-labor-system.html#.UdB8VzsU_-5

http://www.worldcrunch.com/business-finance/the-lessons-of-mexico-039-s-maquiladoras-where-free-trade-and-labor-rights-compete/nafta-low-skilled-workers-globalization/c2s11434/

http://labor.fiu.edu/publications/international/maquiladora/

http://psclasses.ucdavis.edu/POL124/spr/PDF/Honduras.pdf

http://cas.umkc.edu/labor-ed/pdf/PPI%202000.pdf

http://infosurhoy.com/cocoon/saii/xhtml/en_GB/features/saii/features/economy/2012/10/16/feature-02

http://www.corpwatch.org/article.php?id=1528

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8 comments

  1. Great article! And quite the coincidence that I just started reading “Fresh Fruit, Broken Bodies,” a book by a UC Berkeley anthropologist which documents the suffering of migrant workers from Latin America working for transnationals in the US. A steady theme through the book so far is the affect of NAFTA on the Mexican political economy and the “maquiladoras.”

    Also, great job with the numbers and actual data. I find that many radical left blogs take a rather lax approach at looking at hard empirical data in their analysis and propaganda.

    One note: it would help a lot if you specified which citations correspond to which pieces of information. Like, a little number next to the citation in the body like this [1].

    1. Thanks for the support.

      I had actually planned to construct a citation body but after three weeks of trying to finish the article in between work and other obligations I decided to go ahead and just publish it. Although next time I do such an empirically intense article I will definitely create a citation body for the ease of the reader.

  2. A very good comment on the intensifying exploitation by imperialist centres on the neo- colonial peripheries

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