America’s Sweatshop Diplomacy

Jennifer Gordon in The New York Times, August 25, 2011

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By JENNIFER GORDON

ACCORDING to the State Department, the J-1 visa Summer Work Study program, which allows foreign students to work in the United States for a few months, is meant to promote “lasting and meaningful relationships” between the students and Americans.

Try telling that to the more than 300 J-1 holders who went on strike at a Hershey’s distribution plant in Pennsylvania last week, with the support of the National Guestworker Alliance. These engineering majors and future lawyers from places like Turkey, Moldova and China came hoping to travel and speak English, but spent the summer packing and lifting heavy pallets of Kit-Kats, often on overnight shifts and for meager pay.

The America that the Hershey’s workers have seen is surely not the one the J-1 visa was created to promote. But perhaps it is the America we have become. Hershey’s business strategy is a microcosm of the downsizing and subcontracting that so many American companies have pursued during the past few decades in search of ever cheaper labor.

The J-1 visa, also known as the exchange visitor visa, has its roots in the cold war. In 1961, Congress created a program for international students and professionals to travel here, with the goal of building good will for the United States in the fight against Communism. The program, which became the J-1 visa, thrives today — but not as Congress intended.

Instead, it has become the country’s largest guest worker program. Its “summer work travel” component recruits well over 100,000 international students a year to do menial jobs at dairy farms, resorts and factories — a privilege for which the Hershey’s students shelled out between $3,000 and $6,000. They received $8 an hour, but after fees and deductions, including overpriced rent for crowded housing, they netted between $1 and $3.50 an hour. Hershey’s once had its own unionized workers packing its candy bars, starting at $18 to $30 an hour. Now the company outsources distribution to a non-union company that hires most of its workers from the J-1 program.

The Pennsylvania workers are not alone. Recent exposés by journalists and advocates have found similar abuse of J-1 visa holders at fast food restaurants, amusement parks and even strip clubs.

Though the number of J-1 visa holders admitted to the United States swelled from 28,000 in the program’s first year to more than 350,000 in 2010, and the government made minor changes to the program earlier this year, the State Department has never established a sufficient oversight system. Instead, it hands that responsibility to organizations it designates as sponsors, who profit from the arrangement and so have no incentive to report abuses.

Other guest worker programs — themselves often avenues for exploitation — are managed, however ineffectually, by the Departments of Homeland Security and Labor. They require employers to offer international workers the same wages as local workers in comparable jobs and to attest that no local workers are available. Not so with the J-1 visa.

Indeed, the J-1 program is attractive to employers because it is uncapped and virtually unregulated; companies avoid paying Medicare, Social Security and, in many states, unemployment taxes for workers hired through the program. One sponsor authorized by the State Department even offers a “payroll taxes savings calculator” on its Web site, so potential employers can see how much they would save by hiring J-1 visa holders rather than American workers. Visa holders can be deported if they so much as complain, and cannot easily switch employers.

At a minimum, the government should preclude the use of the J-1 program as a way to obtain workers at below-market rates. If the program continues, it should be reformed to explicitly incorporate worker protections, including the right to organize, and should be supervised by the Department of Labor.

But last week’s strike, and the resulting uproar over J-1 visas, should also lead us to rethink the downward spiral of job quality to which such programs contribute. To recover from economic distress, this country needs not only more jobs, but good jobs, with living wages, full workplace rights and meaningful freedom to organize. That goal will remain out of reach as long as easily abused guest-worker programs exist. Among other things, Congress should pass the proposed Power Act, which protects immigrants who report workplace abuses from being deported.

In a way, the students at Hershey’s got more insight into the realities of the American economy than they ever could have expected. Unfortunately, it’s an insight unlikely to foster the sort of “lasting and meaningful relationships” that Congress intended — or the United States needs if it is to promote decent work in a global economy.

Jennifer Gordon is a professor of labor and immigration law at Fordham.