Préval's campaign to raise the nation's minimum wage caught the attention of the Obama administration.
The bump 37¢ bump seems small by American standards, but considering it would raise wages by 150 percent--from 24¢ and hour to 61¢ an hour--the new rule stood to dramatically affect the lives of poor Haitians. However, it would also dramatically affect the bottom line of American companies, like Hanes and Levi Strauss who contracted labor in Haiti to sew their clothes. The companies insisted on capping the wage increase at 7¢ an hour, and the U.S. ambassador pressured Préval into a $3 per day wage for textile workers, $2 less than the original $5 a day that Préval had wanted.
The Nation's
report* on the negotiations show continued disapproval with the politics of the whole thing:
Still the US Embassy wasn’t pleased. A deputy chief of mission, David E. Lindwall, said the $5 per day minimum “did not take economic reality into account” but was a populist measure aimed at appealing to “the unemployed and underpaid masses.”
Ryan Chittum at the
Columbia Journalism Review did a little bit of math to put these figures into perspective. The proposed $5 per day falls well short of
The Nation's estimated $12.50 per day needed for a Haitian family of three to make ends meet. But how dramatically will the even lower $3 a day affect the American companies with a stake in the matter?
Zooming in on specific companies helps clarify this even more. As of last year Hanes had 3,200 Haitians making t-shirts for it. Paying each of them two bucks a day more would cost it about $1.6 million a year. Hanesbrands Incorporated made
$211 million on $4.3 billion in sales last year, and presumably it would pass on at least some of its higher labor costs to consumers.
Chittum notes that Hanes's CEO Richard Noll could cover the losses with just one sixth of his $10 million compensation package. That makes American Apparel and their no sweatshop policy look angelic, sex-crazed CEO Dov Charney and all.