Sweatshop or Real Development?


  

In mid-March 1993, a National Labor Committee fact-finding mission visited Haiti to investigate labor righst conditions.  The delegation met with a braod range of organizations including labor unions; peasant organizations; religious, human rights and development groups; factory owners and inudustrialists; bankers; U.S. Embassy staff; OAS observers; members of the Aristide Government's Presidential Commission as well as members of preceding governments; and of course, the peope of Haiti.

Becuase of the marked increase in military repression as negotiations enter their final phase, we will not identify any of the people we interviewed by named, but rather, only by their organizational affiliation.  Similarly photos were chosen that do not show people's faces or faces have been covered so individuals cannot be identiified.


Table of Contents

Preface: The Generals Must Go by Jack Sheinkman

Executive Summary

Haiti After the Coup: Sweatshop or Real Development? by Charles Kernaghan

Sweatshops, Not Development

What USAID Knew

USAID Opposes Wage Increase

USAID Goes on the Attack Against Reforms

Plan Calls for the Use of Front Groups

Example Set by U.S. Investment: No Contract

Aristide's Actions Gained Support of World Bank

Unions Seek Reforms

Military Hunts Down Peasant Organizations

White House Seeks Appearance of Modest Reform

The Refugee Situation

Conclusion: Haiti and Beyond to NAFTA

Recommendations of the Delegation

Notes

Appendices


 

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Preface

  HAITI: THE GENERALS MUST GO

by
Jack Sheinkman 

 

It is time for the generals, corrupt politicians, drug dealers, and the handful of millionaire families calling the shots for the coup and who continue to control the economy as if Haiti were their own private fiefdom, to step aside.  The de facto regime must end.  The constitutional government, headed by President Jean-Bertrand Aristide must return.  Cut the flow of oil into Haiti and the military will be gone in a week.

When our delegation visited Haiti in mid-March we heard from bankers, industrialists, factory owners, unionists, peasants, OAS observers and from a former government minister under General Namphy, that President Aristide had to return, and fast.  Everything in Haiti is "blocked", we were told.  The country is bankrupt, lawless and getting worse.  There are no rules of the game.  Unions have been destroyed and peasant organizations forced underground.  People fleeing repression cannot work or plant crops.  The social fabric of Haiti, families and communities, are being torn to shreds.  Even business can no longer function.  Industrialists cannot get their own money out of the banks; they have to borrow or buy their money.  Banks have no legal recourse to collect loans.

Haiti is in terrible shape.  For the last nineteen months Haiti has been in the hands of military thugs.  Since the coup, the military has killed over 3,000 people, arbitrarily detained 28,000 others and driven an estimated 350,000 from their homes, turning them into internal refugees.  Another 80,000 people have fled Haiti for their lives, both on the open seas and into the Dominican Republic.

The military has stolen what was left of the workers' state pension fund.  The military has stolen foreign development aid, like the $4.5 million the Canadian government had on account to assist Haiti's poor.  Members of the military leadership have become millionaires by controlling the flow of contraband entering into Haiti.  Despite the OAS embargo, ships from Panama and Mexico were being unloaded while we were in Haiti.

The Haitian military is also involved in running drugs to the U.S.  We found out after we returned from Haiti that the hotel we stayed in, the El Rancho, was being used as a drug transhipment and money laundering point for Columbian drug dealers poisoning the U.S.  This is being done under the watchful, protective eye of the Haitian military.

For the last nineteen months, the military has slashed to almost nothing government spending to maintain Haiti's already poor hospitals, schools, roads, electricity, phones, water or sewer systems.  This is a government which doesn't even collect the garbage.  Stinking refuse builds up in every street, and the people must burn it to keep down the stench and disease.  The infrastructure of Haiti is being wrecked.

The military government had one purpose, to plunder the country--period.  The military leadership in Haiti is nothing other than a lawless and violent gang preying on the people.

There has been a complete breakdown of the rule of law in Haiti.  Law has been reduced to the whim of a thug with a gun, a member of the military or one of their paid informants in civilian clothes.

No country needs a labor movement as badly as Haiti does.  Yet at this moment, the labor movement has been torn apart by a targeted repression.  Union and peasant leaders have been arrested, tortured and driven into hiding.  Nineteen months after the coup unions still can't hold meetings.  Their offices remain under surveillance.  Unions can't organize.  Their membership has been decimated.

In February 1992, at the behest of U.S. corporations, the Bush Administration lifted the embargo, allowing U.S. companies to continue assembling goods in Haiti for export to the U.S.  Our delegation discovered that these companies used the coup and the military repression to fire union organizers.  Haiti's assembly sector, which was approximately 60 percent organized, is now wiped union free.  Wages have been slashed, working hours lengthened, and at the mere hint of dissatisfaction, workers are immediately fired.  It is impossible to imagine, but wages in many factories are as low as 14 cents an hour.  There are no benefits.  In the countryside, we heard farm workers talk of wages equalling 40 U.S. cents a day.  Working people are drinking sugar water-- sugar cane mixed with water to fill their stomachs and blunt the hunger.

The poverty in Haiti is overwhelming.  Eighty-five percent of the population lives in absolute poverty, meaning they earn less than U.S. $150 a year.  Almost one out of every ten children die before they reach their first year.  Only 13 percent of the population has access to potable-- safe-- water.  Adult illiteracy is estimated at 75 percent.

With the overwhelming election victory of President Aristide, for the first time in 200 years the working people of Haiti were free.  Throughout Haiti's history, a tiny white and mulatto elite comprising 4.5 percent of the population controlled 95 percent of the economy and all the political power.  In a recent New York Times article (March 31, 1993), Times correspondent Howard French quotes a respected development economist as saying: "What you have here is a powerful bunch of people with incredible privileges.  They enjoy duty-free imports, they pay no taxes and labor costs them next to nothing.  I have never seen any place quite like this in the world and changing it will not be easy."  It is not infrequent to see the Haitian business elite characterized in the media as a "kleptocracy".

The constitutional government in Haiti will and must return.  The United States can and should help by taking a major lead in the international effort to rebuild Haiti.  The U.S. economy is more than 2,900 times as large as Haiti's.  Also, the U.S. is by far the largest foreign investor in Haiti, accounting for almost 95 percent of all such investment.

For over a decade, the U.S. Agency for International Development (USAID) held that "Haiti's major economic resources are the abundance of unskilled and semi-skilled labor and a sophisticated and dynamic private sector."  Not only is there an "abundance of trainable labor eager to work," but as the U.S. Commerce Department notes, "Haitian wage rates are among the lowest in the Caribbean."  Since the early 1980s, USAID has funded and promoted the development of Haiti as a low wage export platform for offshore assembly industries targeting the U.S. market.  As Haitian exports to the U.S. increased, the wages of the Haitian workers assembling these goods were slashed by more than half.  USAID's strategy failed the Haitian people.

Everything rode on the backs of workers.  Their wages, the lowest in the Caribbean, had to make up for the fact that the Haitian business elite paid no taxes, that contraband trade was widespread, that corruption, graft and military patronage had driven up the cost of doing business by increasing port and utility fees to the point that they became the most expensive in the region.

USAID is still at it.  USAID is already planning to pour millions of additional aid dollars into Haiti to develop the country as a "prime candidate" for "competitive production" based on the same "strong factors", namely "highly productive, low cost labor; proximity of major markets through U.S. ports; entrepreneurial management."

Rather than support badly needed social and economic reforms which were being initiated, USAID actually wrote in June 1991-- in the midst of the Aristide government's reform program-- that, "If Haiti's investment climate can be returned to that which existed during the CNG, ...Haiti stands to experience significant economic growth."  The CNG, National Government Council, was the military-civilian junta that ruled Haiti after Duvalier fled.  USAID went on to oppose the minimum wage increase that the Aristide government had proposed.

The return of the constitutional government to Haiti will represent the first time that the international community unanimously condemned a coup d'etat, refused to recognize the de facto government and maintained sanctions until the elected government's return.

The cold war is over.  We have a new administration in Washington, D.C.  It is time to end USAID's private sector initiative program which has acted as waterboy, cheerleader, financier, organizer and blocker for the tiny and corrupt business elite in Haiti, an elite which has taken millions of dollars out of the country and refused to invest in its own economy.  USAID must learn to play a politically neutral role.

Haiti's unions and peasant organizations will have a critical role to play in rebuilding Haiti's civil society.  They must have our help.

It is in the interest of the U.S. people that our government assist Haiti on its road to real development.  It is not in our interest, and certainly not in the interest of the Haitian people, to have our tax dollars used to turn Haiti into a low wage dumping ground for companies fleeing the U.S.  To this end the National Labor Committee intends to support, work with, encourage and monitor U.S. foreign developmental aid to Haiti.   Every dollar must be conditioned upon respect for internationally recognized worker rights.  It is the law. 

The Clinton Administration must work with the UN/OAS to immediately stop the flow of oil into Haiti.  This is what the Haitian people want.  The workers also told us, "We want our president back."

 

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EXECUTIVE SUMMARY

 

Haitian workers assembling goods for export to the U.S. market are being paid $.14 an hour.  Companies pay no employee health and pension benefits. 

In 1991, the U.S. Agency for International Development (USAID) organized, managed and financed elite business opposition to the economic and social policies of the democratically elected government of President Jean-Bertrand Aristide.  

USAID used U.S. tax dollars to actively oppose a minimum wage increase from $.33 to $.50 an hour proposed by the Aristide government. 

Between 1983 and 1989, as apparel assembly and exports from Haiti to the U.S. doubled, real wages in Haiti were slashed 56 percent. 

In February 1992, the Bush Administration lifted the OAS embargo for U.S. companies assembling goods in or sourcing production from Haiti.  U.S. companies returning to Haiti used the climate of terror and military repression to destroy the unions in their factories.  Despite the embargo, last year more than 67 million pounds of apparel were imported to the U.S. from Haiti. 

In lifting the OAS embargo on the export assembly sector the Bush Administration granted U.S. import licenses to wealthy Haiti business families who are publicly known to have supported and assisted in the coup. 

Unions and peasant organizations have been and continue to be the target of fierce military repression.  All normal union activities remain suppressed.  Unions are growing weaker each day. 

Haiti is in a state of sheer chaos.  The rule of law has collapsed.  The government is not even collecting garbage.  Roads, energy generation, water supply, telecommunications, and ports are all being ruined by neglect and military corruption.

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HAITI AFTER THE COUP: 
 SWEATSHOP OR REAL DEVELOPMENT?

by Charles Kernaghan 
 

FIRST IMPRESSIONS: ANOTHER WORLD...OF MISERY

Haiti is only a one hour and thirty-five minute flight from Miami, but it is another world.  Entering Haiti feels like stepping back into the Middle Ages.  In Haiti's capital, Port-au-Prince, the poor live in miles and miles of broken down shacks made of rough concrete, mud, straw, cardboard and scrap sheet metal.
When the wind blows in off the ocean, the metal roofs strain and rattle.  It's like being inside a tin can.  Open sewers flow down the dirt streets, which are deeply rutted by erosion.  When it rains the sewage overflows into people's homes.  There are no bathrooms, no running water.  There may be latrines, otherwise an area of ground is set aside as "the bathroom."  Thousands depend upon a public faucet, or a broken water main where the people scoop up water.  Children can be seen playing and washing in the open sewers.  The government doesn't collect garbage.  It piles up everywhere in great mounds that the people burn to keep down and to check the spread of disease.  Electricity doesn't come with these slum dwellings, but the people tap into power lines for some light at night.

Everywhere there is the stench of open sewers and the rancid drifting smoke of burning garbage.  People cook what food they have on charcoal fires.  People virtually live on the streets.  Everywhere there are barefoot children in rags, with swollen stomachs.

According to the U.S. government, 60 percent of the children in Port-au-Prince suffer from malnutrition.  Almost one in ten (9.4 percent) of children born in Haiti die within their first year.  Haiti has the lowest calorie intake of any country in the Americas.  Haiti's per capita income (GDP per capita) is $246.13, which is one seventy-seventh that of the U.S.  It is estimated that 85 percent of the Haitian people are living in absolute poverty, earning less than $150 a year.  Safe drinking water is available to only 13 percent of the population.  Only 25 percent of the adult population can read and write.  Only 20 percent of Haitian children finish primary school.  In Haiti, life expectancy is 53.5 years and falling.  In 1989 it was 55.5 years.1 

For the last nineteen months, the military government in Haiti has given the people nothing.  There are no social services at all.

 

LIVING UNDER A TERRORIST REGIME

When we met with a group of Haitian labor leaders they told us: "We are living under a terrorist regime."

In fact, according to Dante Caputo, UN/OAS chief negotiator for Haiti, in 1992 "alone, 3,000 people were killed in Haiti for political reasons." Haitian human rights organizations estimate that there have been 28,000 arbitrary arrests by the military since the coup.  A U.S. Embassy official told us that beatings were a common practice in the prisons.  Eighty thousand people have tried to flee Haiti, taking to the ocean or crossing over into the Dominican Republic.  The repression has created 350,000 internal refugees who have been forced to flee from their homes.

A professor and respected human rights attorney in Haiti told us that children have been shot and killed by the military for carrying pictures of President Aristide.
 We met with a religious leader who was a member of the exiled Aristide government's Presidential Commission in Haiti.  He told us that for the last two nights heavily armed groups in civilian clothing have terrorized the people in his neighborhood-- Carrefour-- by shooting their guns wildly for several hours each night.  Despite all the gunfire, police never came to the neighborhood.  The people had to defend themselves by going up to their roofs with stones.  On the day of our meeting, the military had swept through the neighborhood conducting a house-to-house search.  Needless to say, this was done without warrants.  The people felt that the soldiers were looking for items to steal when they returned at night.  However, the religious leader we spoke with offered a different interpretation.  He felt that the military could not understand the people's resistance.

The atmosphere pervading Haiti was expressed quite tragically on February 25, 1993, when thousands gathered at the Port-au-Prince Cathedral to mourn the deaths of the hundreds of Haitians had who drowned when an overcrowded passenger ferry sank.  Civilian-dressed gangs working with the military attacked the crowd.  Archbishop Willy Romelus was attacked and knocked to the ground.  He was slapped, kicked, punched, his clothes torn and his glasses knocked off and broken.  The thugs called him a communist.  It was only with the intervention and assistance of the French Deputy Chief of Mission and a U.N. official that Archbishop Romelus was able to escape more serious harm.  U.N. chief negotiator Dante Caputo immediately dispatched interna-tional observers to protect the bishop.

An unknown number of people were detained and taken into custody by the military.

During our visit, we spoke with a radio journalist who works for Signal FM and is also a part-time correspondent with Voice of America.  She was at the Cathedral that day covering the event.

She told us that the military grabbed her saying that they wanted to have a talk.  She was taken to an army barrack where she was kicked, punched and beaten on the ears with clapped hands.  Nearly a month later she still cannot hear properly.  This was her second arrest.  There were visible scars on her back from the first beating.

Haiti is a scary place.

A resolution approved on March 10, 1993 by the 55 member nations of the U.N. Commission on Human Rights called for an end to military repression in Haiti and an end to the assassinations, tortures and rapes.

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SWEATSHOPS, NOT DEVELOPMENT: LIFTING THE EMBARGO

 

Just as the OAS embargo was getting underway in Haiti-- in response to the violent September 1991 military coup-- U.S. companies began a lobbying effort directed at the Bush Administration to end U.S. compliance with the international embargo.  On December 23, 1991, corporations with business interests in Haiti bought space in the Washington Post to publish an open letter to President Bush.  They argued that, "By lifting the U.S. embargo you will save lives and lay the economic groundwork for a permanent, stable democracy....Please Mr. President," stated the corporations, "give the American and Haitian workers the best Christmas present yet by allowing them to go back to work."

On February 4, 1992, George Bush lifted the embargo on U.S. companies assembling goods in or sourcing production from Haiti.  State Department spokeswoman Margaret Tutwiler stated that the Foreign Assets Control office of the U.S. Treasury Department would grant special licenses for U.S. companies on a case-by-case basis.  "But if one of those companies is, in fact, owned by an individual actively supporting the coup, we do not believe that Treasury would issue a license."  One hundred and fifty licenses were issued.3

But the Treasury Department did, in fact, hand out licenses to companies controlled by well known coup organizers.

 

IN BED WITH THE COUP LEADERS

Aware that we were a labor delegation, a very decent representative of a Haitian manufacturers association still arranged for us to visit a Haitian assembly factory.  We knew they would show us the top of the line.  The Vetex factory, we were told by the manager who was showing us around, was a joint venture between the Mevs family and RSK Industries, Inc., an apparel firm headquartered in New York.

The Mevs family is well known in Haiti.  It is described in the Journal of Commerce (March 4, 1993) as one of the "handful of families who rose to great wealth during the dictatorship of Francois (Papa Doc) Duvalier with a monopoly on the country's sugar industry."4  The monopoly, known as the Haitian Sugar Company and owned by Fritz Mevs Sr., was one of the corporations that appealed to President Bush to lift the embargo as a "Christmas present" for the workers.

The International Business Chronicle (March 15-28, 1993) reports that "a small clique of rich import-export merchants, with close ties to the military authorities in local ports, have profited from the embargo by smuggling banned goods." The Mevs family has its own private pier in Port-au-Prince.  Haitian Senator Bernard Sansarich recently accused Fritz Mevs, Sr. of running contraband cement illegally imported from Jamaica and Cuba.  According to Senator Sansarich, Mevs made four million dollars on each of nine illegal cement shipments beginning in June 1992.6

Fritz Mevs, Sr. is also "said to share the military's disdain for Mr. Aristide,"7 according to the Journal of Commerce.  In Haiti, we were told by a prominent religious figure that, "it is public knowledge that Mevs was one of the chief organizers of the coup."

The Bush Administration repeatedly turned to this same Mevs family to seek help in breaking the political deadlock in Haiti.  The Journal of Commerce noted that Dante Caputo, the UN/OAS Special Envoy to Haiti, "resents the U.S.-Mevs contacts.  He says they reinforce the view that Washington is coddling anti-Aristide forces, the very people Mr. Caputo says must cede to international pressure to restore democracy."8

There is more.  The Mevs family also owns over 2.5 million square feet of factory and warehouse space-- 60 buildings-- spread out over three industrial parks housing assembly industries that target the U.S. market.  The Mevs' assembly operation near the national airport is said to be one of the largest privately-owned industrial parks in the Caribbean.9

 


factory

 

 

 

THE MODEL FACTORY...14 CENTS AN HOUR

The Vetex company consisted of two adjacent plants where approximately 500 sewing operators, inspectors, folders and packers-- overwhelmingly women-- were assembling children's wear and women's undergarments for export to the U.S. market.  The children's matching outfits, the swimsuits and the little girls dresses were particularly colorful.  These women were sewing for Sears-- some of the children's wear labels we saw were Silver Unicorn, KV Kids and Electric Kids.  The factory also assembles clothing for J.C.Penny and Wal Mart.  Other labels we saw were Devant and Seabell.  

The plant was clean and well lit, despite the fact that there were few windows.  Piped-in "Muzak" was playing over loud- speakers.  It was hot, but not stifling since there were fans, though it was not air conditioned like the front office.
 The legal minimum wage in Haiti is H$ 3 (3 Haitian dollars) a day.  The Vetex manager, who had been educated at Rutgers University in New Jersey, explained in perfect English that he paid his workers H$ 5 a day.  He also told us that they were turning out 228,000 panties and bras a week for shipment to the States.
 The factory operated on a five-and-a-half day schedule, 6:30 a.m. to 3:30 p.m. Monday through Friday and 6:30 a.m. to 12:30 p.m. on Saturday-- a 45 hour work week, not including lunch break.

A Haitian dollar equals 5 gourds.  So a wage of H$ 5 would amount to 25 gourds a day.  At the current exchange rate of 13.5 gourdes to one U.S. dollar, the Vetex workers would be making US$ 1.85 a day, or 23 cents an hour.  For a 45 hour week they would earn $11.11.

However, even these claims by management turned out to be inflated.  We were a fairly large delegation, 10 people, including our two translators.  Members of our delegation were able to break off from the main group, staying far enough behind to be able to speak privately with the workers.
 A different story emerged.  The majority of workers told us that they were paid H$ 3 a day.  This amounts to US$ 1.11 a day.  Incredibly, this is less than 14 U.S. cents an hour.

One woman we spoke to was a single mother with two children.  She told us that she made H$ 3 a day-- US$ 1.11.  How did she make ends meet?  She said it cost her the U.S. equivalent of 44 cents a day for transportation to and from work-- there is no public transportation. The workers use the colorful, but dangerously over-crowded "tap-taps," which are small pick up trucks outfitted with covered wooden cabs and benches.  She also spent about 30 U.S. cents for lunch.  This meant that she went home at the end of a nine-hour day with the equivalent of 37 U.S. cents in her pocket. 

We spoke with another young woman, in her early 20s, who was expecting her first child.  She also made H$ 3 a day-- not the H$ 5 management had claimed.  She too had to pay 6 gourds, 44 U.S. cents, to get to and from work.  (Everyone we spoke with paid either 6 or 7 gourds each day for transportation.)  She spent 15 U.S. cents for breakfast and 22 cents for lunch.  At the end of the work day, she had 30 cents left.

We did find someone who was making more than H$ 3.  A woman sewing a KV Kids outfit for Sears told us she earned between H$ 3.50 and 4.00 a day.  She had worked in the plant seven years.  We asked if she could afford to feed her children on these wages.  "No," she replied, "I must borrow."

An extremely competent looking woman in her late thirties who had worked in the plant for four years as an inspector also made H$ 4 a day.  No one we spoke with made more than this.  Four Haitian dollars is the equivalent of US$ 1.48 a day.  Travel cost her 52 U.S. cents a day and she spent 37 cents a day on food.  That leaves 59 U.S. cents.  To make H$ 4.00 she works a nine hour day.  She has two sons, eight and ten.  She told us, "The money goes very fast.  Often there is nothing left for the weekend."

As we were about to walk away she looked at us and said, "We want our president back."

A young man was sewing Electric Kids outfits.  He had worked in the plant for four years.  He was making H$ 3 a day.  He had a wife and two children, aged one and four-and-a-half.  It cost him 41 U.S. cents a day for transportation and he skipped lunch.  This meant he could go home with 70 cents a day.

He and his family can afford only one meal a day.  His home is a one-room straw hut.  There is no water, no electricity.  When it rains, the house becomes flooded and everything is drenched.  For such a house for his family, he pays US$ 115 a year rent.  What else can you afford on wages of 14 cents an hour?
 We asked, was there ever a union here?  He told us, "There used to be a union before the coup.  After the factory re-opened, all the union members were fired."

As we were leaving the factory, some of us trailing far enough behind the manager could hear the workers telling us in a loud, persistent whisper, "Three dollars a day.  Only three dollars a day."  They wanted to set the record straight.

 

A COMPANY 34 TIMES THE SIZE OF HAITI

Sears can do better than that.  It doesn't have to contract out work for 14 cents an hour.  In 1990, Sears Roebuck's gross revenue totaled $56 billion.  This was 34 times the size of Haiti's entire gross domestic product in 1991.

We watched the workers at the Vetex plants attaching Sears "Kid Vantage" price tags to the children's clothing they had sewn.  The price for one child's outfit was $9.99.  The label was proudly advertised that it had been printed on recycled paper.  Standing in that factory in Haiti, this play toward the environmental consciousness of the U.S. consumer seemed hollow, even plain cynical.  RSK, J.C. Penney and Wal Mart could do better than this.

Licenses for all Mevs' industries exporting to the U.S., including joint ventures and sourcing contracts, should be immediately revoked.  The Mevs joint venture with RSK Industries, Inc. is most likely not unique.  Since the Mevs own three industrial parks, it is probable that the family is involved in numerous joint ventures and other contract work.  This should be immediately investigated by U.S. officials.
 Fritz Mevs, with a company operating under his own name in Miami, is also importing baseballs made in Haiti into the U.S.  In just three months, November and December, 1992 and January of this year, Mevs imported 108,076 pounds of baseballs.  How did this get by the Bush Administration?

We had the opportunity to meet and speak with a young man who belonged to a Christian youth group and worked at a large foam factory owned by the Mevs family.  He was paid US$ 33 a month, $8.33 a week.  He told us there was no union at the factory; it was not allowed.  He said that spies were employed to report back to management.  Any discussion at all of working conditions, wages, or benefits was enough to get you fired.  Any worker even suspected of wanting a union was dismissed.

We do not need employers who blatantly violate the human and worker rights of their employees selling their products on the U.S. market.

The National Labor Committee knows of 66 U.S. companies importing mostly assembled goods from Haiti.  In 1992, despite the OAS international embargo, U.S. apparel firms and retailers-- "under a loophole benefiting U.S.-owned exporters"-- imported $67,629,000-worth of clothing sewn in Haiti.10


ON THIS PAY WORKERS CAN'T SURVIVE 

We had the chance to visit another apparel plant, which wasn't the top of the line.  It wasn't owned by the Mevs like the Vetex plant, but conditions were a little better.
 At this plant, 400 women sewed eight hours a day assembling women's undergarments for Rocky Mount, TNB/NY and State Nightwear labels.  The base pay was H$ 4.50.  With overtime the women could earn H$ 6.50 a day.

But even H$ 6.50 is only US$ 2.41 for a nine hour day-- 27 cents an hour.  Workers and owner agreed, you cannot survive on that pay.

We questioned the owner, "Why can't you pay more?"  He explained that when the embargo was lifted many U.S. companies let it be known that they would continue contracting assembly work to Haiti only if their costs were lowered.  The owner claimed he could not pay more and survive in the business.  What were other assembly companies paying?  He told us that many he knew of were paying H$ 2.00.  That would be only 74 U.S. cents a day, nine cents an hour.  Had his factory ever been inspected for compliance with state occupational health and safety or environmental regulations?  "Never," he responded.  Does his company pay taxes?  "No, none of the companies do."  Are there any health or pension benefits for the employees?  "No, not now.  The companies pay nothing."  Was there a union in his plant?  "There was a union before the coup, but afterwards the repression was too great.  The military was hunting them.  They were afraid and fled Port-au-Prince.  Now, we have no union."

He was a factory owner.  He was obviously doing quite well for himself.  We asked if assembly operations like his, which sewed cut fabric shipped from the U.S., were the way to develop Haiti's economy.  Again he answered, "No.  There is no tie-in between these assembly operations and the domestic economy.  We get the pieces, the labels, the plastic wrappings and the hangers from the U.S.  All we do is sew and then ship.  This is not going to build real industry in Haiti." 

Later, we were told by a representative of a manufacturers associations that the "value added" by the garment assembly sector in Haiti to the products exported was 13 percent.  No component of the garment is produced locally in Haiti.  The only value added to the clothing is the cost of the labor to sew it.  At a wage of 14 cents an hour with no benefits, no corporate taxes and factory rents of US$ 1.25 per square foot per year, that does not leave much money behind in Haiti.  According to the U.S. Commerce Department, Haiti exported $177.9 million worth of apparel to the U.S. in 1989.11  USAID maintains that Haiti's assembly sector is the "most dynamic sector" of the economy.  But the real value of Haiti's apparel exports in 1989 was only $23.1 million dollars-- the labor value added in Haiti-- not $177.9 million.  Most of this apparel "trade" comprised U.S. components going back and forth.

As we left, we couldn't help remarking on the badly rutted dirt road in front of the plant.  This was a busy commercial district in the capital, Port-au-Prince.  The owner explained that a year ago he had spent H$ 15,000 of his own money to repair the road and fill in the foot-deep ruts.  Now it was a mess again.  The military government does absolutely nothing.  Public administration has completely broken down.  An open sewer runs right in front of the plant.  When it rains, the filth flows into the factory.

 

U.S. COMPANIES IMPORTING FROM HAITI

This Survey covers a three month period:

November, December of 1992 and January of 1993.

In February of 1992, the Bush Administration lifted the OAS embargo allowing U.S. companies to source production from Haiti. Despite the embargo, these 66 U.S. companies received a special license from the Bush Administration to import into the U.S. from Haiti.

A & M Liberty

Action Screen Printing

Aga Electronics

Anchor Apparel, Inc.

Ansell International

Arkie Lures

Basket Case

Chauvet & Sons

Cherokees

Cosgrove Enterprises

Costa Nursery Farms

Cottage Collectible

Country Originals, Inc.

Crystal Brands, Inc.

Cuirs Hawtan

Dentzel Furniture Design

Diane Palmer

Dudley Sports (Spalding and Evenflow Companies, Inc.)

Eden Toys (Penguin USA)

Elsie Undergarment Corp.

Flotronics

Frank W. Wine & Sons

Fritz Mevs

Gateway Agency

GCP

General Stores

General Toys

General Trading

H & F Manufacturing

H.H. Cutler

Hans Baskets

Happy Fella

Harry J. Rashti and Company, Inc.

Hartford Prospect Industries

 

LET THEM EAT SUGAR CANE WATER AND BREAD  

A researcher gave a Haitian woman friend of hers H$ 15 and together they went off to the La Saline market, which is located in a poor slum area.  She wanted to see what and how much food the woman would buy with the H$ 15, which is about $5.55 U.S.

The Haitian woman was an experienced shopper.  This is what she was able to purchase before the money ran out:
* A small basket of 12 plantains
* four onions
* four tomatoes
* about 3 cups of cornmeal
* four bouillon seasoning cubes
* a cup of sugar

That was it.  She explained that since the coup, market prices had quadrupled.

The most common meals for working families are cornmeal with onions or some boiled plantains with beans-- when beans can be afforded.  Almost everyone is down to one meal a day.  Most have to borrow what they can to survive.  Many working families have only bread to eat and rely upon sugar cane water to fill themselves up.  The poor are barely surviving, but they are getting sicker.
 At the "model" apparel factory owned by one of the richest families in Haiti, the highest paid workers received H$ 4 a day-- US$ 1.48.  The average transportation cost to and from work was 44 cents a day, while a meager breakfast and lunch came to 33 cents.  This left 71 U.S. cents to bring home at the end of an eight or nine hour day.  Multiply this by six days and you have $4.26 to meet a family's expenses for a week.  According to USAID, food typically accounts for 64 percent of the cost of a basic "basket" of necessities needed for the minimal survival12 of a poor Haitian family.  This means that a working family would have approximately $2.73 a week with which to feed themselves-- a little less than half of what our experienced Haitian shopper had to spend.  The remaining $1.53 would have to cover rent and all other expenses.
 The USAID mission in Haiti could immediately perform a valuable piece of research by thoroughly investigating how working families in Haiti are able to survive on the prevailing wage being paid by Haitian, U.S. and Asian contractors in the assembly sector.

 

MILITARY STEALS THE WORKERS PENSION

ONA, the National Office of Old Age Pension, was created in 1967.  It was to function as a social security system to cover workers who retired or were incapacitated.  Two percent was deducted from the employee's wage, and the employer was supposed to match that two percent.13

Businesses-- including U.S. companies-- stopped paying social security benefits after Duvalier fled in 1986.  This is confirmed by U.S. Department of Labor "Foreign Labor Trends" reports on Haiti.  The Labor Department states-- in its Key Labor Indicators-- that from 1986 through 1989 "supplementary benefits as % of manufacturing earning" in Haiti were "negligible."14  In other words, as standard practice assembly companies in Haiti were paying no benefits for their employees.
Even when the money was being collected by ONA, it was deposited at the National Bank at zero percent interest rate.  The funds sometimes served as a pool of no interest/no payback loans for Duvalier's business cronies.

Now that the military is in charge, what is left of the ONA fund is being totally plundered.  The Port-au-Prince Chief of Police, Lieutenant Colonel Joseph Michel Francois appointed his girlfriend Margareth Lamur to run the ONA pension fund.
 Another of Lt. Col. Francois' businesses was reported on in 1992 by the London-based Economist Intelligence Unit:

 One operation was providing a group of officers with $500,000 a month through racketeering in cement from the state factory; the group was said to involve the Chief of Police, Colonel Michel Francois, who is reported to be a multi-millionaire.  Some are said to have become millionaires by exploiting shortages resulting from the embargo.15

A Haitian Army captain's salary is US$ 160 a month, but by plundering the poorest country in the Western Hemisphere-- their own-- the military leaders live like-- and are-- millionaires.

It is this same Police Chief who banned all street demonstrations, no matter how small and orderly.

Lt. Col Francois was trained at the U.S. military's School of the Americas in Georgia at U.S. taxpayers' expense.

Haitian workers are also supposed to have health insurance.  The public agency is called OFATMA, the National Insurance, Worker Accidents, Illness and Maternity Office.  By law, the employer is mandated to pay the equivalent of three percent of the company's payroll to OFATMA.  Again, no one does, including the U.S. companies.16

If you enter a state-run hospital in Haiti, you must bring your own sheets and purchase your own food while you are there.  Often more than one person is in a bed.  Patients have to buy their medicines as well as any needles that might be used.  A foreign religious worker who had been working in Haiti for over a decade told us that at the state-run hospital in Hinche, Haiti's fourth largest city, there is blood on the floors and sheets, and the stench is unbearable.

After the coup, the military destroyed the union at the state-owned telephone agency, Teleco.  Some unionists were killed, others fled.  The military then fired both the workers who represented the union as trustees overseeing the workers pension fund along with management.  Once the union was gone, the military could start plundering the estimated $2.6 million telephone workers' fund.

A former high official in Teleco told us that it was standard practice-- even during the short Aristide government-- for several military leaders to receive "paychecks" every fifteen days.

 

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WHAT USAID KNEW: EXPORTS UP -- WAGES DOWN

USAID knew that legally mandated worker health and pension benefits were not being paid by either domestic or U.S. companies operating in Haiti.17
USAID also knew that Haitian wages, expressed in U.S. dollars, had fallen 39 percent from 1983 to 1991.18 

But even this underestimates the severity of the wage cuts.  Since benefits were also not being paid, the dollar value of Haitian wages had actually fallen 56 percent between 1983 and 1991.  And this wage decline coincided with a virtual doubling of Haitian apparel exports to the U.S.

By 1989, there were 100 U.S.-Haitian joint venture apparel operations employing 15,000 sewers assembling clothing for the U.S. market.  Haitian apparel exports to the U.S. grew from $81 million in 1983 to $177.9 million in 1989.  This represented an average 14 percent annual increase.  In 1989, apparel comprised 47 percent of Haiti's total exports to the U.S.  In 1989, Haiti was the third largest exporter of apparel to the U.S. in the entire Central American and Caribbean region.19

 

EACH JOB FEEDS 5 TO 7 PEOPLE

USAID knew that each job in the assembly export sector in Haiti feeds an estimated five to seven people.20  In 1990, an estimated 70 percent of the Haitian workforce was either unemployed or underemployed.

How do seven people survive on a wage of 14 U.S. cents an hour?  Even the highest paying jobs at the Vetex apparel plant owned by Mevs and RSK, Inc. left the worker with $2.73 (U.S.) to spend on food for the week.  Divide that by seven, and you get 39 cents to feed a person for a week, or six cents a day.

USAID also knew that transportation costs cut deeply into the workers' wages.  A study done in the early 1980's found that some assembly workers spent as much as one-quarter of their daily wage, and two hours of time, just getting to and from work.  "Transportation to and from work is a major problem for employees in Port-au-Prince," according to the U.S. Commerce Department, which went on to note that, "It is both expensive and unreliable."21

In fact, the U.S. government knew a lot about the reality of the Haitian assembly jobs USAID was promoting.  In 1989, the U.S. Commerce Department summarized the working and living conditions of Haitian assembly workers this way:  

"Health and sanitation facilities at all socioeconomic levels are either limited in degree of sophistication or nonexistent.  The vast majority of the population, including most of the relatively better-off factory employees in Port-au-Prince, does not have ready access to safe drinking water, adequate medical care, or sufficient nutritious food.  There are essentially no unemployment or social assistance programs.  Education is relatively expensive and thus out of reach for much of the population."22

 

WOMEN GET SPECIAL TREATMENT FROM USAID  

In 1986, USAID put $7.7 million into an Export and Investment Promotion Project "to recruit assembly contracts and attract overseas investors" to Haiti.  USAID felt that "medium and smaller-sized American compan[ies]..., which often do not have overseas offices, have to be reached through aggressive outreach efforts."  Haiti's "large pool of productive, competitive labor seeking employment" would be one of the "factors enhancing" this promotional effort.23

According to USAID, one of the primary objectives was to help Haitian women.  USAID observed that, "Assembly industries in Haiti have a tendency to create a relatively greater demand for female workers who are believed to be better qualified for work which requires detail, dexterity, and patience.  This carries a particular advantage in that increased employment for women in urban areas provides additional income which will more directly bear on the welfare of infants and children."24

USAID carried out a "social soundness analysis" showing that "the project will have a strong impact on women..."
In 1984, USAID was writing the same thing: "The assembly industries constitute one of the most dynamic economic activities in generating jobs for women.  To date, they have created some 60,000 jobs locally, 85% of which are occupied by women."25

Only here, USAID admits that, "Although the importance of women in the industrial sector of Haiti is unquestionable, the conditions under which they work are not generally conducive to realizing their productive capacities nor adequately safeguarding their children's welfare."26

USAID's public stance was that its real target in working with and financing Haiti's business sector was always to create decent paying jobs that would allow Haitian families to live in dignity and health.  How odd then, that USAID has no empirical studies clearly documenting the number of jobs created in Haiti's assembly export sector, no studies on what percentage of these jobs went to women, whether or not the minimum wage was paid, how many hours were worked, whether overtime and benefits were paid, what working conditions were, how people traveled to and from work, what it cost and how long it took, and how families could afford to live on the wages paid.  In 1984, USAID observed, "Haiti has no reliable work force data."27  In 1992, the U.S. Commerce Department again noted, "No reliable data exists" on wages and that, "Reliable data on employment are non existent in Haiti."28  USAID never bothered to document the most basic working and living conditions of those very people whom they were supposed to be assisting.  What little information exists has to be pulled from between the lines, or sought in other places than USAID reports.

However, USAID was funding studies as early as 1980 that were proving that it was far cheaper for U.S. companies to produce in Haiti than in the U.S., despite the costs of relocation, setting up production, freight and customs.  A survey of Haitian and U.S. electronic assembly plants operating in Haiti established that 38 percent of the companies enjoyed savings of between 20 and 40 percent over U.S. production, while 20 percent enjoyed savings of between 40 and 60 percent.  This study may also have pinpointed the real interest in women assembly workers; that is, "Women workers tend to be quieter."  Also, "Traditional management prerogatives such as the right to hire and fire are respected by the government.  There are no profit sharing schemes or feather-bedding requirements."  Only quiet women who "are young and highly motivated" and who "adapt easily to industrial discipline..." are strong candidates for employment.29

USAID never wavers.  In June of 1991, USAID allocated another $5 million to continue its 1986 investment promotion efforts aimed at attracting assembly industries to Haiti.  No need for another "social soundness analysis," for "The impact of this project on Haiti's poor was demonstrated in the original economic and social soundness analyses" back in 1986 (despite the fact that there was no reliable data, starting in 1984 through 1992, concerning the actual living and working conditions of assembly workers).

USAID could still go on to note in mid 1991 that,  "Most of these jobs will be for low-income citizens with a large proportion of these going to women.  As citizens enjoy employment opportunities, they can then secure their shelter, provide necessary nutrition for their families, place their children in schools and provide adequate health care for their families.  With improvement in the social status of its citizens, Haiti's new democracy will be strengthened and the participation of its population assured."30

No sooner had this been said, then USAID set out to oppose the Aristide government's attempt to raise the pitifully low minimum wage in Haiti's export assembly industry.  
 

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USAID OPPOSES WAGE INCREASE  

 factory employee who worked for Wilson Sporting goods in Port-au-Prince during the period President Aristide was in office told us that he worked ten hours a day for US$ 12.22 a week.  This would make an annual wage of $ 635.29.  Even if this was only nine hours of work, allowing an hour for lunch, it would still amount to only 27 US cents an hour, $ 2.44 a day, without benefits.  This was a little above the minimum wage, which has been set at 15 gourdes a day since 1984.  At the 1991 market exchange rate of 8.5 gourdes to one U.S. dollar, the minimum daily wage for an eight hour day was US$ 1.76, or 22 cents an hour.  Wilson's extra five cents an hour meant it was paying 23 percent above the minimum wage.  This must be what the U.S. Commerce Department meant when it stated, "Although no reliable data exists, wages in the assembly sector, which are based mainly on piece-work, are higher than the minimum..."31

On Apil 2, 1991, just two months into the new administration, President Aristide invited Haiti's private sector leaders to the National Palace for a meeting.  He appealed to them: "The country needs you."  President Aristide requested their help.32  Something had to be done to begin to improve the miserable conditions destroying the Haitian people.  A year earlier the Haitian Chamber of Commerce had warned that "the execrable living conditions of our workers" would eventually lead to social upheaval.

The U.S. Commerce Department was saying that, "In real terms the minimum wage declined 45 percent"33 in Haiti since 1985.  But it was worse still, because health and pension benefits were not being paid.  And as USAID observed, in 1990, "essential services and infrastructure have deteriorated significantly" because of military corruption preceding the Aristide government.  USAID pointed out that, "Haiti is one of the world's least developed countries and is the poorest country in the Western Hemisphere."34

 

hourlyrate

 

 

President Aristide, who was elected by over 67 percent of the popular vote, proposed raising the daily minimum wage from 15 gourdes to 25 gourdes.  The Haitian Senate called for a new minimum wage of 28 gourdes.

If President Aristide's reform measures had gone through, the new minimum daily wage in U.S. dollars would have been $ 2.94 a day, or 37 cents an hour.  The Aristide government also pressed to reform the corrupt national workers health and pension benefit agencies.  Had Aristide's plan been accomplished, and had real benefit payments been made by domestic and foreign companies, the fully loaded minimum daily wage would have been $ 4.03, or about 50 cents an hour.

Had the Haitian Senator's wage package been approved the fully loaded minimum hourly wage would have been 53 cents an hour.

Though the new minimum wage under the Aristide government would have still been less than one-eleventh of the average U.S. apparel wage (50 cents versus $5.85 an hour), USAID opposed this increase and orchestrated opposition to it.  

 

USAID GOES ON THE ATTACK AGAINST REFORMS  

In the middle of the constitutional government's short reign, USAID was declaring that "signals" from the Aristide Administration "to the business community have been mixed."  USAID went on the attack saying that, "decisions have been made which could be highly detrimental to economic growth, for example in the areas of labor and foreign exchange controls."35  USAID was displeased with the fact that the democratically elected government wanted to place temporary price controls on basic foodstuffs so the people could afford to eat.

But USAID's real wrath was targeted on labor reform efforts.  According to USAID, the proposed minimum wage increase would price Haiti right out of the low wage assembly market.  We are told that "wage systems should not be the forum for welfare and social programs..."  USAID warned that "high distortion in labor costs"-- i.e. the 50 cent hourly wage proposed by the constitutional government-- "for example, can lead to capital intensive, rather than labor intensive responses to opening of markets."36  Haiti might turn into Switzerland or Denmark.

The Haitian government had to understand this one thing:  "Haiti has comparative advantage in its location and in its highly productive, low-cost labor force."  USAID set the game rules: "The business sector in Haiti has been a dynamic force since the mid-1970s with exporters, primarily in the drawback assembly sector, diversifying products and markets to capitalize on Haiti's comparative advantages in the world marketplace."  USAID threw its full weight behind "stimulating the growth of demand for labor."37

USAID had work to do.  In 1991, USAID stated, "Labor remains a major problem in business development and expansion in Haiti.  While Haitian labor is generally highly productive at the worker level, frequent disruption caused by strikes, unexpected holidays and labor actions impede overall productivity in Haiti."  Also, "With the proposed minimum wage, Haiti's pricing of exported goods will exceed that of the Dominican Republic, Jamaica, El Salvador and Honduras."38

This was not true, and USAID knew it.  A study commissioned by USAID showed that even if Haiti's manufacturing wage were increased to 75 cents an hour, well above what the Aristide Government was proposing, this would still be 15 percent lower than Jamaica; 35 percent lower than Cost Rica; 50 percent lower than Mexico; and 64 percent lower than Barbados.  The only country Haiti would surpass if a 75 cent an hour wage was achieved would be the Dominican Republic,39 USAID's proclaimed showcase of a successful-- and USAID sponsored-- development strategy.

Also threatening was that, according to USAID, the Haitian "labor courts have been viewed as predominately biased in favor of labor..."  USAID would therefore, "address these judicial issues and work with the business community to document handling of labor disputes for dialogue with the government."40

Just how threatening to the investment climate in Haiti was the labor movement?  To answer this we will quote at length from USAID itself.

USAID: RADICAL ORGANIZATION OR TWO-FACED PHONEY?  

The army, always a corrupt element that routinely loots the society, has been allowed to run out of control.  The old privileged elites of the Duvalier era are still largely in place, and rapacious new ones have arisen to seize hold of the Haitian economy.  These entrepreneurs have a 19th century approach to making money and have moved in to take advantage of the country's massive and cheap labor pool.  They run sweatshops, pay starvation wages and oppose any effort to improve the lot of the average impoverished Haitian.  It is this new economic class that Haiti's incipient trade unions now battle against on behalf of their members.  The most that can be said for the unions' progress is that they have a toehold in the society...41

This could have been written by the Haitian labor movement, by the National Labor Committee, by Americas Watch, by the Washington Office on Haiti, or by Amnesty International.  However, it was written by USAID in August 1990 for a 1991 Haiti project it was funding.

For the last decade, the U.S. Commerce Department has essentially portrayed worker rights conditions in Haiti as unchanged.  The following, written by Commerce in 1991 is typical of its yearly reports:

Haitian labor unions remain weak for social, historical, and economic reasons.  Union contracts do not yet exist; rather, informal, unofficial, mostly unwritten agreements, and in some cases, tacit acceptance allow the presence of unions in plants.  Although unions have become relatively more active in grievance negotiations, formal management recognition of unions as bargaining agents is not yet the norm.  Even with no government interference, the relatively new phenomenon of trade unionism has developed erratically in Haiti, where unemployment or under employment is estimated to affect at least 50 percent of the available work force, and where many employers would prefer not to work with unions.42  

In summary, USAID sees Haiti's unions as having a tiny "toehold" in an economy dominated by rapacious elites left over from the Duvalier era, while the U.S. Commerce Department sees Haiti's unions as weak in a society "where many employers would prefer not to work with unions."

One might conclude from this that USAID would be supportive of labor unions.  Unfortunately, nothing could be further from the truth.
 

USAID LONGS FOR A GOOD INVESTMENT CLIMATE

Under the Aristide government, USAID observed, "Businesses are postponing investment and reducing inventory while waiting to see the future directions of the new government before making significant business growth decisions."43  USAID, which had spent tens of millions of U.S. tax dollars since 1980 to foster offshore investment in Haiti's low wage assembly sector, stopped promoting investment in 1991.

Three months before the coup d'etat that toppled the democratically elected government, USAID was musing: "If Haiti's investment climate can be returned to that which existed during the CNG or improved beyond that and the negative attitude toward Haiti appropriately countered, Haiti stands to experience significant growth."44  The CNG was the National Council of Government headed by Lieutenant General Henri Namphy, a Duvalier loyalist, who took power after Duvalier fled.

Looking back on these military juntas, The Economist noted in December 1990 that:

The spirit of the Duvaliers lives on among the military tyrants who have, since 1986, continued to repress the poor, black majority in the interest of a tiny, rich, light-skinned elite.  Public housing, health, education and transport have grown steadily worse.45

In July of 1987, under the CNG government, 139 peasants were hacked to death with machetes because they were demonstrating in support of land reform efforts.

U.S. General Accounting Office researchers visiting Haiti in 1988 found, "A constraint frequently cited by U.S. officials and some private-sector representatives is the lack of investor confidence in the country's stability following the ouster of the Duvalier dictatorship."46  

Of course, "The organized labor movement in Haiti" under Duvalier was "almost non-existent."  In 1982, the U.S. Labor Department was able to state that:  

An abundant supply of labor is one of Haiti's major attractions for foreign investors.  Together with political stability and proximity, it gives the country a strong comparative advantage in labor-intensive primary and assembly industries and in the provision of tourism services for North American markets.47

No unions and a 34-year dictatorship created political stability and a good investment climate in Haiti, according to AID and the Labor Department under the Bush Administration.

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PLAN CALLS FOR THE USE OF FRONT GROUPS

As soon as President Aristide came into office, a USAID/Haiti Mission internal staff assessment concluded that the incoming Aristide Government "could benefit from position papers staking out the issues" in order to suggest "possible policy solutions" to direct economic development.  The USAID study continued, "However, in view of legitimate political sensitivities, greater policy ownership by various Haitian interest groups may be more important than more donor produced studies and reports."  The "donor," USAID, was supposed to go backstage.  Rather, "Enhancing indigenous policy dialogue capacities within the private sector may be the most productive course of action..."  The internal assessment suggested that "an ad hoc committee of business organizations under the umbrella of USAID's export and investment promotion project (Prominex)...could not only propose and oversee the preparation of policy papers but could entertain proposals from a variety of private sector interest groups."48

According to AID, "Policy reform will be more effective in the emerging democratic and nationalistic environment if many diverse internal interest groups are assisted in understanding and articulating policy positions."49

USAID next set out to open a dialogue with these "many diverse internal interest groups."  The USAID internal working paper mentioned above was completed in February 1991, the month President Aristide assumed office.  By April, USAID had a team of experts on the ground in Haiti.  The team included Charles Beaulieu, the former governor of the Haitian Central Bank.  (USAID was quite familiar with Haiti's banking system, having allocated over $53 million to private banks in that country since the early 1980's.)  USAID had chosen the Stanford Research Institute, working with Ernst and Young, to carry out this research.  These were two very trusted USAID contractors.  In 1991, the Virginia-based Stanford Research Institute received $1,227,000 in USAID contracts to assist the "Agency in Economic Policy Analysis and Assessment of Science and Technology Policies,"-- while the Washington, DC-based firm of Ernst and Young collected $6,149,445 in contract fees.

The purpose of their mission was made explicitly clear.  According to their report, "The emphasis of the study team was placed on listening to business people, learning about their problems and constraints and looking for solutions to the problems."  The "many diverse internal interest groups" were to be drawn exclusively from the business community.  The Stanford Research Team reported back to USAID that the government's proposed minimum wage increase:

...is generally not being very well received by the business community in Haiti.  Many business leaders fear that the large minimum wage increase will lead to higher wage demands from semi-skilled and skilled workers, which will be beyond the companies' capacity to pay, given the high cost structure in Haiti for non-labor cost factors such as port charges, electricity and telecommunications.50

Given the source of funding for the contract, it should not come as too much of a surprise that the Stanford Research Institute is in full agreement with USAID: "One of Haiti's main assets is its large pool of disciplined and competitively priced labor," which "can be used for targeted promotional efforts, as the business climate is improved."51

For USAID and the Stanford Research Institute, Haiti's future is being jeopardized by "the new wage bill" which "is expected to reduce the overall competitiveness of Haiti."

USAID's next move was to quickly allocate $26 million to the "ad hoc committee of business organizations"-- under USAID's control-- to help keep "Haitian production competitive in world markets."52

1991: USAID ALLOCATES $26 MILLION TO BIG BUSINESS

A USAID internal working paper-- referred to above-- recommended that an "ad hoc committee of [Haitian] business organizations" be organized and placed "under the umbrella of USAID's export and investment promotion project (Prominex)."  Prominex, the Center for the Promotion of Investment and Exports, which receives 99 percent of its funding from USAID, is in fact a USAID front group.

USAID/Haiti Mission Director David Cotten moved to implement the above recommendation on June 29, 1991.  Mr. Cotten wrote:  "USAID/Haiti recommends that the authorized level of the Export and Investment Promotion project (521-0186) be increased from its present level of $7.7 million, by an additional $5 million to a total of $12.7 million."  The USAID project would also be extended for four more years.53

One of the main thrusts of this project would be "sector support."  Namely, "to develop a consensus in the business community on key economic requirements for sustainable economic growth and develop an approach for policy dialogue with the government..."  The refurbished Prominex operation, referred to by USAID as "the cooperating organization," was instructed that it was responsible for the:

Establishment of an advisory committee, with approval of USAID, to broadly represent the Haitian business and commercial sectors; convening regular and special meetings of the committee; advising this committee of its mandate to make Haitian production competitive in world markets...54

According to USAID, the "project will work with local business organizations to develop internationally competitive local production, build constituencies for open market policies, and move Haiti toward becoming a full partner in the hemispheric free trade block."  Of course, it was Haiti's "highly productive, low cost labor" which was to be the engine for integrating Haiti into the "hemispheric free trade block."  Also, it is worth keeping in mind that 95 percent of all foreign investment in Haiti is by U.S. companies.

Furthermore USAID notes, "the project is integrally linked with other mission activities related to trade development and democratic initiatives."  For example, "The Credit and Financial Markets project is a critical component of the Mission's private sector strategy and works to address capital constraints to business starts and expansions."  This was project 521-0223 to which USAID allocated $12 million beginning in 1991. 

Beyond that there was the "Policy and Administrative Reform Project ...[which] will support the enhancement of democracy and greater participation of all Haitians in the economic benefits of democracy, from a business perspective, by working with business organizations..."55

This was project 521-0222 to which USAID allocated $7 million beginning in 1991.
 After 67.5 percent of the Haitian people had voted for change, USAID worked with the Haitian business elite to keep things the same.  As the Aristide government came into office, USAID allocated $7.7 million to Prominex ($2.7 million left unspent was rolled over into the extended project), $12 million in loans to business, and $7 million to foster democracy "from a business perspective"-- a total of $26.7 million.

 

PROMINEX MISPLACES $2 MILLION IN U.S. TAX DOLLARS

What sort of an organization was Prominex?  In 1989, Haitian press reports indicated that U.S. officials were irritated by the behavior of Prominex Chairman Joel Thebaud, who was using U.S. tax dollars on too many first class plane trips and lavish dinners.  There were also allegations that $2 million in USAID funding had been misappropriated.56  This is something only USAID could confirm.  However, in 1991, before pouring another $5 million into the project, USAID scrapped the Prominex label, renaming its project Probe--  Promotion of Business and Exports.

Prominex was created by USAID in 1986 "to recruit assembly contracts and attract overseas investors" by mounting "a marketing effort that identifies the country as a serious contender for overseas investment."  Two of Haiti's strong points were "a large pool of productive, competitive labor seeking employment"  along with "a sophisticated and aggressive group of successful entrepreneurs."57  In fact, this appears to be central to USAID's development strategy for the entire Central American and Caribbean region.  In country after country, USAID's strategy is based on working with local business elites in order to more efficiently utilize the large pools of low wage labor available across the region.

When it came to the difficult promotional step of "selecting the geographical areas and specific companies within the sector" to be targeted in North America, USAID instructed Prominex that this should "be contracted out to firms in the U.S. or Canada which specialize in this activity."  Using U.S. tax dollars: "These firms will begin to assemble a network of contracts within the U.S. and elsewhere which will constitute the market base of the promotion strategy.  These contacts will be aggressively pursued through the Division's marketing efforts" (i.e. promotional mailings, trade shows, seminars, U.S. trade promotion services, lending institutions and face-to-face contacts).58

 

ANOTHER FRIEND OF USAID -- THE STRANGLER

Chosen as president of USAID's Prominex project was Andre Apaid, a wealthy Haitian businessman.  Apaid owns Industries Nationales Reunies, S.A. (INR), a contract assembly firm employing over 1,700 workers in 1990.  INR's most successful division is Alpha Electronics, S.A., which assembles electronic products for Sperry/Unisys, IBM, Remington and Honeywell.  Alpha-supplied components end up in U.S. government computers and U.S. Defense Department sonar and radar equipment.59

At the December 1991 Miami Conference on the Caribbean-- sponsored annually by Caribbean/Latin American Action and attended by over 1,000 business and government leaders-- Andre Apaid addressed a "Haiti Strategy Breakfast."  Asked what he would do if President Aristide returned to Haiti, Apaid vehemently responded, "I'd strangle him!"  The tone of the breakfast meeting was such that the British ambassador to Haiti got up and left.

Alpha Industries was one of the companies that urged President Bush to lift the embargo to give the "best Christmas present yet" to the Haitian workers.

Alpha Industries is also now exporting assembled goods to the U.S., despite the fact that Apaid is a known sympathizer with the coup, and, in fact, is a major financial contributor to de facto Prime Minister Marc L. Bazin.   Apaid is one of the chief lobbyists in the U.S. for the military government in Haiti.

Any company importing into the U.S. with ties to the Apaid family should be immediately stripped of its import license. 
  
 
CAN YOU TELL AN ORGANIZATION BY ITS FRIENDS?

USAID's close working relationship with the Haitian business elite-- i.e. in terms of organizing, training, technical assistance, financing and promoting-- is not only questionable, it also failed miserably.

Corporations and their owners in Haiti, USAID's partners, pay no taxes.  A 1989 U.S. Department of State country report on Haiti noted, "Tax evasion is a time honored tradition in Haiti."60  Commenting on the situation in Haiti in 1990 the U.S. Department of Commerce stated, "Corporate and income taxes are largely evaded, so much of the burden is on the taxpayers in the form of consumption taxes."61  In other words, one of the poorest countries in the world-- where the vast majority of the population earns under $150 a year-- also has one of the most regressive tax structures.  The Haitian government tries to get by on a 10 percent sales tax.

What about U.S.-sponsored reform efforts?  After a ten year relationship, and after USAID had poured over $100 million into Haiti's private sector, USAID was forced to admit in 1992 that:  "Most tax assistance efforts have failed in the past because top GOH [Government of Haiti] officials' commitments were too often compromised by illicit arrangements with taxpayers and strong taxpayer resistance in paying taxes because such funds were too often wasted or misappropriated."62  If it sounds dismally corrupt, it is, but it also gets worse.  And what about the U.S. taxpayer who was footing the bill so USAID could pour more than a $100 million at this corrupt business elite?

Illegal trade was also rampant.  According to USAID, in 1990 Haiti's "contraband trade is estimated to be about $300 million per year, or about 50 percent of total imports."63  We are informed that "Customs outside Port-au-Prince remains out of control."  By a conservative estimate, the Haitian government, which is so badly strapped for revenue, is being cheated out of at least $60 million dollars a year in customs duties due to this illegal trade.

Referring to the period preceding President Aristide's administration, USAID observed at the time that the "provisional regimes have lost management control over the public enterprises and have increasingly used them for political patronage, graft and corruption, including allowing the military to profit from potential control over public enterprise wholesaling."64

It is difficult to imagine a more corrupt private sector, operating completely on its own set of rules.  According to USAID, in Haiti, "most companies keep several sets of books for different audiences and accounting firms are not required to follow standard reporting practices."65

Even when it came to the centerpiece of Haiti's assembly export sector, apparel, this too functioned outside of the law.  In the mid-1980's Bobbin Magazine reported that "there are no clear-cut regulations in Haiti establishing quota right priorities to 807 plants (i.e. plants assembling U.S. piece goods) now operating or seeking to operate in Haiti nor are there clear-cut rules pursuant to which the Haitian government makes annual allocations."66  In short, the tiny handful of Haitian families, like Mevs, Apaid, Nadal, Acra, Bigio and Saliba do whatever they want.  

Haiti's business class," writes the Journal of Commerce, "portrayed by critics as one of the world's least socially conscious, has traditionally bankrolled army generals to protect its government contacts and business monopolies.  This has perpetuated a kleptocratic system that has prevented Haiti from making headway toward economic or political democracy, critics say."67

USAID, of course, will say they always distanced themselves from this corrupt business elite.  Back in 1982 the U.S. Department  of Labor reported, "Haiti's economy is mainly governed by the private sector, which...is controlled by a few related or closely associated groups of individuals."68  This is what USAID was going to change with its support to the private sector.  Also writing in 1982, USAID explained its strategy:   

Finally, an expanded AID program will provide vital support to modernizing forces and institutions in Haiti, and help movement toward a more open and democratic society...These developments toward a more open and participatory society require enforcement on every level... There has been no time in recent Haitian history when prospects for strengthening modernizing forces have been greater than they are today.  Support for this process is not only consistent with U.S. values and traditions but it is also at the heart of our highest policy objectives for hemispheric development.69

USAID's private sector program was meant to create a new business class of "socially responsible capitalists," and foster an "economic pluralism [that] will lead to political pluralism."  However, years later in 1989, USAID was still putting forth the same line:

Our private sector strategy has been to work through intermediary institutions which address specific constraints to private sector growth.  These institutions then work directly with investors and private sector representatives to channel resources to progressive elements of the private sector dedicated to long term development in Haiti.70

The best thing that can be said about USAID's 10 year attempt to work with the "progressive elements of the private sector" is that it was a miserable failure.

In 1988, the U.S. General Accounting Office-- the investigating arm of Congress-- reported that Haiti's economy is "dominated by a rich elite of closely associated family groupings who control export-import trade, tourism, construction, and the formal manufacturing sector."71  A year later the U.S. Department of Commerce observed the same: "Haitian Society is highly personalized.  Friendship and social connections, therefore, may carry more weight than legal rights and responsibilities."72

In short, the old boy network continues to reign and completely controls the economy.  USAID's programs did not make a dent in the "time honored tradition in Haiti" of corporate and income tax evasion.  USAID was unable to even slow down the growth in contraband trade.  Nor did they even scratch the surface of the graft and corruption which permeate Haiti's business climate.

After over $100 million spent, and after a decade of working with Haiti's private sector, it is a legitimate question to ask, what if anything has USAID accomplished?  Disturbingly, it appears precious little.  Whatever happened to the socially conscious progressive middle class?

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EXAMPLE SET BY U.S. INVESTMENT:  NO CONTRACT 

Writing in 1992 the U.S. Commerce Department stated that,  "The United States is by far the largest foreign investor with an estimated $120 million [$90 million excluding inventory] invested in Haiti as of early 1991.  With the exception of several oil companies and banks (Texaco, Exxon, Bank of Boston, Citibank), U.S. investment is almost entirely in the assembly sector."73  U.S. investment is estimated to represent over 90 percent of  total foreign investment in Haiti.  Also, 95 percent of Haiti's light manufacturing exports are destined for the U.S. markets.

What have been the social results accompanying this U.S. investment?  In 1982, the U.S. Labor Department observed that, "There is a long history of government repression of the labor movement in Haiti."  Not surprisingly then, "The organized labor movement in Haiti is almost non-existent."  However, "investment and assembly-type opportunities in Haiti are excellent because of Haiti's low labor costs."

If we leap ahead to 1990, the U.S. Labor Department is still convinced that "dexterous, low-cost unskilled labor [all] remain selling points for labor-intensive assembly operations in Haiti".  Nor has the labor rights situation changed all that much.  According to the Labor Department's 1990 report "Worker Rights in Export Processing Zones":

It appears that while freedom of association, the right to strike, and to organize are legally provided to all workers in Haiti, in reality few workers enjoy such rights whether employed in export processing operations or local firms.74

To the Labor Department, "it appears that many employees of the export industry are not in fact willing to bargain with trade unions."  Also, "many employers, domestic and foreign, still question the legitimacy of unions."75  In fact, there is not one single collective bargaining agreement in effect in Haiti's assembly sector.

Once again, what happened to the progressive element of the private sector that USAID was nurturing?  During the 1980's USAID spent millions to promote foreign investment in Haiti's assembly sector, while the continuing violation of internationally recognized worker rights in the export processing zones remained nearly untouched.  Given that USAID was working with U.S. companies and U.S. Haitian joint ventures, the job of promoting worker rights should not have been insurmountable.


DEJA VU ALL OVER AGAIN

In April of 1992, in the midst of the violent intransigence of the military regime in Haiti, the U.S. Commerce Department calmly noted:

After an internationally recognized government is reestablished, the best long-term prospect for U.S. business will continue to be investment in export assembly operations.  Haiti's proximity to the United States, its access to Generalized System of Preferences (GSP), Caribbean Basin Initiative (CBI) and Section 807 U.S. Customs benefits, as well as its abundance of low-wage, productive labor should make it a good location for assembly operations when the country achieves some level of political stability.  Best prospects for U.S. exporters include imports for the Assembly Sector:  textiles, electronic components, packaging materials, and raw materials used in the manufacture of sporting goods and toys.76

Notice that the Commerce Department cannot bring itself to mention the restoration of the elected constitutional government of President Aristide.

We heard this in 1982 from the U.S. Department of Labor:  "An abundant supply of labor is one of Haiti's major attractions for foreign investors."  Of course, they are referring to "Haiti's low cost labor."77

In 1984, the Commerce Department believed that, "Haiti's major economic resources are the abundance of unskilled and semi-skilled labor and a sophisticated and dynamic private sector.78"

In 1985, Commerce observed that, "Both foreign and Haitian businessmen share the same views on the environment for doing business in Haiti.  All fully appreciate the low cost labor, and strong work ethic of the Haitian people.  Absenteeism is low and work stoppages are rare..."79

In 1986, USAID explained that, "A large part of productive, competitive labor seeking employment in industry and agriculture" was one of the key "factors enhancing" U.S. investment in Haiti.

By 1991, nothing has changed.  USAID believes, "Haiti has some strong factors which make it a prime candidate for increased international trade and competitive production."  Those factors just happen to be:  "highly productive, low cost labor; proximity of major markets through U.S. ports; entrepreneurial management."80

ALL OF IT ON THE BACKS OF THE WORKERS

Besides its involvement in contraband trade, drugs, and milking public sector enterprises, the Haitian military absorbs 20 percent of the national budget.  This is an expensive and unnecessary burden, especially if one tries to consider who Haiti's enemies might be or where the threat of foreign invasion might come from.

All this inefficiency, corruption, graft, and feeding on state agencies have driven Haiti's utility costs, like electricity and telecommunications, so high as to be among the region's most expensive.  Doing business in Haiti is not cheap.  Shipping and warehousing costs are excessively high.  The infrastructure is minimal.  Illiteracy is high.

The U.S. Commerce Department explained it like this in its 1985 report "Doing Business With Haiti."  Yes, Haiti had "infrastructure and bureaucratic problems..."  However, "In spite of these difficulties, both foreign and domestic entrepreneurs are unanimous in their opinion that high productivity and low labor costs outweigh all other problems and led to profitable operations."81  

If USAID could not or did not want to take on the pervasive corruption that drives the Haitian business elite, then the high cost of doing business in Haiti would have to be made up for on the backs of the workers.  Low wages would keep the investment climate favorable.

This helps explain how, as Haitian apparel exports to the U.S. more than doubled between 1983 and 1989, the real wages of the Haitian workers assembling those garments were cut in half.  As corruption and inefficiency grew, wage costs had to be forced down.  Where was USAID's partner, the progressive private sector?

WHERE IS THE MIRACLE IN THE MODEL?

Haiti has always ranked among the top Central American and Caribbean exporters of assembled goods to the U.S.  In fact, in 1983, Haiti was exporting more manufactured goods to the U.S. than any other country in the region.  By 1984, Haiti's position had slipped to second, and by 1988 Haiti had slipped to third place, but Haiti still remained a major player the region.

USAID's development model focused on expanding the region's non-traditional exports to the U.S.  At the center of their model was the export assembly or light manufacturing sector.  In 1980, Haitian manufactured exports to the U.S. totaled $216 million.  By 1989, Haiti exported $370 million of assembled goods to the U.S.  So between 1980 and 1989, Haiti had increased its exports by $154 million --by 71 percent.  USAID's model seemed to be working.  Forty-one thousand Haitians had jobs in the export assembly sector.  There were an estimated 150 factories producing these goods for the U.S. market.  U.S. investment was playing a lead role.  Approximately 40 percent of the assembly plants were Haitian owned and producing under U.S. contracts, while the remainder were U.S. or U.S.-Haitian owned.82

However, these official export figures are quite misleading.  The clothing, electronics, toys and sporting goods Haiti is exporting are fully formed by U.S. components shipped to Haiti.  Haitian plants just do the assembling work.  Labor is the only value added to the product in Haiti, and it amounts, on average, to 20 percent of the product's value.  So in 1989, Haiti's real manufactured exports to the U.S. totaled $74 million, or 20 percent of the total and not the $370 million figure the U.S. Commerce Department uses.  Their figure includes the well over $200 million worth of U.S. components being shipped back and forth.  In reality then, Haitian manufactured exports in 1980 totaled $43.2 million, growing only to $74 million by 1989.  This was a real gain of only $30.8 million in exports.

At the same time Haiti's traditional agricultural exports to the U.S. --for which the value added in Haiti is 90 percent-- were dropping.  The real value of Haiti's agricultural exports in 1980 was $32.4 million.  By 1989, these traditional exports had dropped to $12.6 million, indicating a $19.8 million, or 61 percent, decline since 1980.  Over the entire decade of the 80's, Haiti's real exports increased by a mere $11 million dollars.

Seen in this light, the USAID export model did not produce any miracles.

Also, the fact that real wages in Haiti had been more than cut in half during the same period, reaching 25 (US) cents an hour without benefits in 1989, is another indication of the failure of USAID's export development model.

USAID poured over $100 million into Haiti's private sector.  In return, the U.S. market gets flooded by cheap products assembled in Haiti with highly exploited labor earning 25 (US) cents an hour.  U.S. companies relocating offshore to Haiti refuse to negotiate collective contracts or pay benefits.  Union organizers are fined and blacklisted.  Under these conditions, Haitian workers can barely survive, and they are certainly not purchasing goods made in the U.S.

It is difficult to understand who it is that is served by USAID's development strategy.  But none of this seems to matter.  Nothing changes.  USAID and the Commerce Department have not even winced.  In 1992, they were back with the exact same plans for Haiti's future. 

 

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WHO IS USAID HELPING?

For years USAID had been promoting foreign investment in Haiti, and, since 1986, $12.7 million had been obligated to that end.  However, as explained by the Stanford Research Institute-- a consulting group hired by USAID-- USAID's investment program actually focused "on export promotion [contract generation] instead of investment promotion."  The goal was to link U.S. firms with Haitian contractors who would assemble piece goods for the U.S. market.  The U.S. Commerce Department in 1992 explained the relationship as such:  

A large proportion of assembly firms are limited exposure operations in which a Haitian businessman provides workers, plants, and equipment, while the foreign buyer provides the raw materials and purchases all output.  This management is preferred by the majority of U.S. firms operating in Haiti because it removes some of the risks inherent in foreign investment.83

In general terms, USAID explained that, "A major focus of the trade development policy is on building developed country and LDC [lesser developed country] private enterprise ties on a continuing, long-term basis, consistent with the broad American objectives of trade liberalization."84  If USAID's development strategy worked, they would be creating a "continuing, long-term" relationship between the U.S. private sector (representing an economy 2,964 times larger than Haiti's) and the tiny Haitian private sector (which USAID itself described as leftover "privileged elites of the Duvalier era" and "rapacious new ones..that have a 19th century approach to making money...").

Also, one must not forget that over $100 million of U.S. taxpayer money was used to forge this development model.

As mentioned earlier, when President Aristide assumed office, USAID's investment promotion efforts ground to a halt.

According to USAID, "with the advent of the Aristide government...In general, businesses are postponing investment and reducing inventory, while waiting to see the future directions of the new government before making significant business growth decisions."85

USAID stopped promoting investment, and instead turned its attention to defending the investment climate it had struggled to keep in place ever since the fall of the Duvalier dictatorships.  USAID made available a $7.7 million dollar project (one of several) to "assist the business community to address the business and policy environment in Haiti."  USAID would "work to develop sustainable dialogue between the government and the business community aimed at increasing sustainable economic growth."86  USAID was defending its friends in business from any potential vagaries now that Haiti's first-ever democracy was in place.

This wait and see attitude on the part of USAID was doubly strange given the active and large scale support the Aristide government was receiving from the World Bank and the Inter-American Development Bank.

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ARISTIDE'S ACTIONS GAINED SUPPORT OF WORLD BANK

In July 1991, the Consultative Group for Haiti-- composed of 11 countries and 10 international donors-- met at the World Bank's office in Paris.  The meeting was chaired by the World Bank's Caribbean director Yoshiaki Abe.  In what the Inter-American Development Bank (IDB) referred to as a "show of support by the international community," the Consultative Group committed more than $440 million in aid to the Aristide government.  According to World Bank official Yoshiaki Abe, the donors strongly endorsed the new government's investment program.87  How did these countries reach such a different position from USAID?

Again quoting the IDB: "In February 1991, when Haiti's first democratically elected government took office, the economy was in an unprecedented state of disintegration."  However, "the Aristide administration acted quickly to restore order to the government's finances."88

In the eight months before the coup the Aristide government:
* Reduced the country's foreign debt by $130 million;
* Increased its foreign exchange reserves from near zero to $12 million;
* Increased government revenues "owing to the success of the tax collection measures and the government's anticorruption campaign;"
* "To curb expenditures, the government streamlined the bloated public service and eliminated fictitious positions in government and government enterprise;"
* Made significant inroads to curb the enormous flow of contraband trade, while lower duties and simplifying the customs system;
* Brought "the inflation rate down dramatically from 26 percent in December 1990 to 11 percent in August 1991;"
* Established a "uniform exchange rate system at the market rate;"
* And signed an agreement with the International Monetary Fund.

According to the IDB these actions were "welcomed by the international financial community" and led to a pledge "that a substantial increase in assistance to the country would be forthcoming."89 
 

 

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UNIONS SEEK REFORMS 

Of course, it was not that the Aristide Administration was meeting only with the World Bank, IMF and IDB.  The unions were also allowed in the door at the National Palace, and they came with their own list of demands.

In March of 1991, leaders of the Independent General Organization of Haitian Workers (OGITH) met with President Aristide.  OGITH then represented around 18,000 members, most of whom were employed in the industrial sector.

OGITH demanded a lot.  They wanted freedom of association and the right to collective bargaining guaranteed.  They called for an end to military intervention in the workplace.  OGITH wanted the minimum wage increased to match the cost of living and tied to inflation;  that public sector workers be granted the right to organize; that the labor code be reformed to prohibit arbitrary dismissals for union activity;  that maternity benefits be paid and child care centers established in the industrial parks.  The defunct national workers health and pension benefit system should be completely overhauled.  Workers representatives should sit on a commission overseeing this restructuring.

Beyond these demands, the union requested that the new government undertake an emergency jobs program to help create employment, and establish centers for worker training.  OGITH wanted the Aristide Administration to end Haiti's involvement in the massive free trade zone being built on the border of Haiti and the Dominican Republic.  Newspaper ads in Haiti and the Dominican Republic are promoting this zone, called Hong Kong Del Caribe, as completely union-free, with wages one-tenth of those in the U.S. and with U.S. government financing available.

These demands are reasonable.  After all, even the dated labor code supposedly guaranteed that the minimum wage would automatically increase whenever inflation rose 10 percentage points, that companies would be obligated to pay a 50 percent overtime differential as well as health and pension benefits, and provide a doctor, nurses and a dispensary in every plant with 200 or more employees.  Companies were also to pay for employees' transportation to and from work.  But, as we have seen, none of this has been adhered to in reality.

In fact, as a 1988 study by the International Labor Rights and Education Fund revealed, the Haitian army frequently intervened in labor disputes.  The government conducted no health and safety inspections.  Workers attempting to organize unions were frequently fired.  Blacklisting these fired organizers was also common practice.  Workers were confronted by company representatives with the threat, "I'm going to put you on the list."  Even the low minimum wage in Haiti was often avoided by companies hiring new workers, who while on a three-month probation period were paid 60 percent of the minimum.  After three months, these workers were fired and new ones brought in.90  In 1989, for example, some companies paid wages of 15 U.S. cents an hour by constantly using temporary workers.

At the time of the coup, the Aristide Administration was moving to reform the labor courts, increase the minimum wage, restart and restructure the workers national health and benefits program, bar the military from intervening in workplace disputes and also to guarantee the right to organize.

All of this was destroyed in the coup.

 

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"EVERY DAY WE ARE GROWING WEAKER..."

The National Labor Committee arranged a meeting with several of Haiti's union federations including the Independent General Organization of Haitian Workers (OGITH), the Central of Haitian Workers (CTH), the Workers Federation of Trade Unions (FOS), the National Confederation of Haitian Teachers (CNEH) and the General Confederation of Labor (CGT).

"We are living under a terrorist regime," the unionists told us.  "Only our courage brings us here."  "A small group is stepping on the will of the people."  OGITH and CGT leaders were the most outspoken:  The unions had been broken, they could not function.  The maquiladora sector had been 50 to 70 percent organized.  After the coup, the factories fired all the union-affiliated workers.  Now the companies pay whatever they want.  It's impossible to even talk about wages or working conditions.

Membership meetings have not been possible during the last 19 months.  Only small clandestine leadership meetings are attempted.  Even now, union leaders move about only with special precautions.  Union offices remain under surveillance.  Phones are tapped.  In the countryside, things are much worse.

The unions told us, "Every day we get weaker and weaker."  "Conditions are unlivable, but the people have no recourse.  Two or three workers can't even talk together about their union."  "One of the reasons for the coup," we were told, "was President Aristide's proposal to increase wages."

The labor federations were unanimous in calling for the immediate return of President Aristide and Haiti's constitutional government.

The unions had "great hope in President Clinton."  They asked us to inform the American people of conditions in Haiti so that "U.S. and Haitian workers can together keep up the pressure until our government is returned."

We were disturbed but not surprised at the state of Haitian labor after 19 months under siege.

In August of 1992 Amnesty International concluded: 

Lawlessness prevails.  Human rights abuse is part of most Haitians' daily life.  The security forces and the thousands of civilians acting in collusion with them carry out a wide range of abuses with total impunity.  The old repressive structures, which the deposed government had partly succeeded in dismantling, are back in place.  The civilian authorities are totally unwilling or powerless to stop these abuses, while the military, which is practically the sole authority in many areas of the country is clearly spearheading the repression.  

Those targeted for human rights violations have included members and leaders of popular organizations, peasants, trade unionists, students, journalists, members of the Catholic Church, and virtually anyone suspected of supporting the return of deposed President Aristide.91

Americas Watch in a 1993 joint study with the Coalition of Haitian Refugees concluded:  

The military forces that overthrew Haiti's first freely elected president, Jean-Bertrand Aristide, have consolidated their rule by ruthlessly suppressing Haiti's once diverse and vibrant civil society --the range of civic, popular and professional organizations that had blossomed since the downfall of the Duvalier dictatorship seven years ago.  In a country where, only nine months before the September 30, 1991 coup, 67 percent of the voters cast their lot with Father Aristide, the army has presumed that the majority of the population is hostile to military rule.  Seeking to avoid the kind of popular unrest that brought down past military regimes, the army has attempted to deny the Haitian population an organized platform for its discontent by systematically repressing virtually all forms of independent association.  The aim is to return Haiti to the atomized and fearful society of the Duvalier-era so that even if international pressure secures the return of President Aristide, he would have difficulty transforming his personal popularity into the organized support needed to exert civilian authority over a violent and recalcitrant army.  

In was one of the profound tragedies of the violent military coup of September 1991 that this surge of organized popular activity came to a bloody halt.
 "...[T]argets of this violence include pro-Aristide elected officials, rural development and peasant organizations, neighborhood and community associations, trade unions, and literacy, pro-democracy, students' and women's groups.  Soldiers and section chiefs have hunted down, arrested, beaten and killed leaders and members of these groups.
92

An International Confederation of Free Trade Union (ICFTU) delegation, which included AFL-CIO representatives, found on a February 1993 visit:  

Terror and the intimidation have meant that the civil organizations in Haiti are in a state of disintegration.  Most of the local trade unions were shut down by the authorities and their meetings were prohibited.  The result is that the trade unions were forced to go underground. 

Some employers were quick to take advantage of this situation.  They dismissed trade union activists, especially in private enterprises placed under army 'protection'.
 "No trade union organization can function normally today in Haiti.  They cannot make demands or mobilize their members.

The ICFTU heard the same fundamental demand from Haiti's unions as did the National Labor Committee:  

For the trade union centres, only the immediate re-establishment of democracy, that is the return of the elected President Jean-Bertrand Aristide who was expelled by the military in September 1991, can improve the socio-economic situation.93 
    
 

"TOTALLY LACERATED AND MUTILATED"

On Sunday, March 14, National Labor Committee delegates met with representatives of the General Confederation of Labor (CGT).  One of them explained that they had just come from a small clandestine meeting at which the union decided that, after 19 months of military repression, the CGT would attempt to resume normal and open union activities.  There was hope in their decision.  It was also driven by the reality that their members could not survive much longer living in fear and denied work.  The CGT would work with other unions and peasant organizations to demand the return of President Aristide.

The CGT began proposing the idea of holding a general strike.  By late April, they were ready to act.  On Friday, April 23, three union leaders, Cajuste Lexius, Fabonor Saint-Vil and Saurel Aurelus went to a local radio station to announce a general strike set for that coming Monday.  In front of the radio station the three men were grabbed by the military police.

According to the head of the OAS/UN Human Rights Mission in Haiti, Colin Granderson, "All three were badly beaten."  After speaking with Granderson, the Miami Herald reported that Lexius "needed emergency surgery to drain the infected wounds on his lower back and buttocks which were, according to the OAS/UN head "totally lacerated and mutilated."94 

Haitian legislator, Philippe-Kerney denounced the attack as a "barbarity" and said the three unionists needed immediate hospitalization "in order to survive."  

As of this writing (May 1, 1993), the military is still refusing, despite considerable OAS/UN pressure, to release the imprisoned unionists.  According to the Haitian military, the unionists were responsible for the incident which occurred after "a policeman was insulted and treated like a servant."

Tragically, there is nothing unusual in this brutal attack, nor in the ridiculous rationale given by a military out of control.  Efforts are underway at this moment to demand the immediate release of these detained Haitian unionists. 

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MILITARY HUNTS DOWN PEASANT ORGANIZATIONS

A farm worker in Haiti made 42 U.S. cents a day before President Aristide was elected.  That was if the worker was a man;  women earned between 28 and 36 cents a day.  The men were working for five cents an hour.  Sometimes farm workers received only bread in return for the day's labor. 

A peasant family in Haiti is lucky to eat meat once every four or five weeks.  Ordinarily the diet is largely corn or rice, depending on the season.  The typical extended family of 10 people shares three tiny rooms.  There is ordinarily only one bed.  There is no electricity, no running water, no bathroom or refrigeration.  The peasant farms by hand, using only a type of machete.  Health care is extremely inadequate.

A number of peasant organizations sent representatives to Port-au-Prince in order to meet with us.  When we asked them how much money a peasant earns in a year, they were a little taken aback.  No one thinks in those terms, they explained.  Maybe a peasant family brings in US$ 80 over the course of the year, but whatever comes in must be spent immediately.

Under the Aristide Administration, farm workers' wages were raised to nearly US$ 2.00 a day, and wages for women and men were equalized.  President Aristide was only applying the law, which since 1984 mandated that the rural minimum wage be set at 13.20 gourds a day.  Depending upon the exchange rate, this would amount to between US$ 1.65 and $1.89.

Everyone who bothered to look, including the U.S. State Department, knew that prior to Aristide, "The government has not systematically enforced labor laws regarding wages and minimum safety regulations..."95

It had taken Aristide to do that.  And instituting equal pay for equal work also had the important effect of drawing more rural Haitian women into the struggle for social justice.  

One of the coup's objectives was to stop this movement.  Following the September 1991 coup, peasant organizers were hunted down like animals by the military.  We heard testimony like the following from a peasant leader in Haiti's Central Plateau region:  The military broke into his home at 3:00 a.m.  He was taken to the barracks where he was beaten and tortured for several days before being dumped, unconscious and with a badly broken arm, on the street.  The military warned the people not to take him to the hospital.  Walking under the cover of darkness and staying well off the road, peasants carried the wounded organizer for two nights out of the hills and into Port-au-Prince.  After recovering enough to walk, the man fled to the Dominican Republic where he lived outdoors in hiding for six months.

"IF YOU ARE HERE TO CAUSE TROUBLE IT WON'T BE GOOD FOR YOU"  

We wanted to see first hand the reality in the countryside.  A National Labor Committee team set off for the provincial capital of Hinche, which is located in the country's Central Plateau region.

Hinche is Haiti's fourth largest city.  It is 68 miles from the capital, Port-au-Prince.  For the trip we hired a brand new four-wheel-drive jeep and a professional driver.  It took us four-and-a-half hours to get there.  The main highway to Hinche resembled, at its best parts, an abandoned logging road.  The dirt highway was deeply rutted and covered with potholes and sharply jutting rocks exposed by the erosion.  It was clear that the government had failed to maintain the road.  We jolted along at 15 miles and hour gulping Pepto-Bismol to calm our stomachs.  If it rained the highway would be impassable.

As we expected, the peasants in the Central Plateau had no access to electricity or safe drinking water.  The whole way, we passed only one small hospital.  We watched as a sick person sitting in a chair and covered by a sheet was carried to the hospital by relatives or friends who had run tree branches under the chair so they could carry the weight on their shoulders.  It was sad and hard to believe such conditions.

The peasants' homes were tiny, all had straw thatched roofs.  As we passed many of the adults were using large wooden pestles to pound grain.  

The countryside was beautiful, but it was dry, stark and almost picked clean of vegetation.

This felt like an abandoned part of the earth.

To get to Hinche you have to pass through four or five military check points blocking the road.  At the last one, our jeep was searched.  In our glove compartment the soldiers found a paper with the name of Chavannes Jean-Baptiste on it.  The guards became livid with anger.  Our passports were taken.  An officer then threatened us:  "If you are here to cause trouble, there will be trouble for you."  He told us to get back in the jeep.  He got into the front passenger seat.  He was taking us to the military barracks in Hinche.  The mood was serious.  We were especially concerned for our Haitian driver.  He told us afterwards that as he drove he was already imagining and counting the blows he would receive at the barracks.  However, seeing we were from the U.S., the commander just took down our names and passport numbers, smiled, told us not to look so nervous and said we could go, and that he would give us a military escort to our meeting.

It had been Chavannes Jean-Baptiste who from Port-au-Prince had arranged for our meeting with members of the Peasant Movement of Papaye (MPP), who were in hiding around Hinche.  Chavannes was the leader of the MPP.  After the coup, the military put a bounty of US$ 10,000 on Chavannes, a tremendous amount of money in a country where peasants earn perhaps $80 a year.  But no one turned Chavannes in, though he was in hiding in the Central Plateau region for over two months before he was able to make his way to Port-au-Prince.

Once in Port-au-Prince, Chavannes was appointed by exiled President Aristide to be a member of the Presidential Commission which would represent the exiled government on the ground in Haiti.  Thanks to the presence of the OAS/UN mission in the capital, Chavannes is no longer an easy target for the military.

But why did the military hate the MPP so much?

"THERE WILL BE NO MORE MPP"

When we left the barracks a motorcycle soldier was assigned to "escort" us to our destination, which was a religious compound outside of Hinche.  About an hour had passed from the time we were stopped at the checkpoint, questioned and taken to the barracks.  Word must travel quickly among the peasants in the area, for when we arrived at what was to have been a clandestine meeting with MPP members who were in hiding, no one was to be seen.  We were greatly relieved.  The soldier left and we found ourselves alone talking with a foreign religious worker.  A short time later, a man entered the room, introduced himself as an MPP representative and welcomed us to the Central Plateau.  He explained that when they received word of what had happened, it was considered too dangerous for the other MPP members to remain, so they had slipped away.

When he felt it was safe, he returned for he was anxious to meet with us.  We noticed that several people were acting as lookouts for this man.  Three or four times they came into our meeting to tell us that a military patrol was on the road behind the religious compound and that peasants passing by the front road said the military had set up a checkpoint a quarter mile down the road.  This MPP member obviously had friends.  We felt he would be all right when we left.

The MPP, the Peasant Movement of Papaye, has about 35,000 members.  Also, the MPP was part of the National Peasant Movement of the Papaye Congress (MPNKP), which had about 100,000 members.

After the coup, he told us, "The military came shooting and destroying everything.  Since then no one has been even able to say the name of the MPP.  We have had to go back in the box like little matches."

He thought that as many as 3000 peasants had to flee the Central Plateau.  Mostly only the old remained, but even so, he explained, the repression continues.  The military comes in the middle of the night to rob people.

When they arrest you, they extort money from your family.  The military demands H$200 or H$300 from the families, either not to beat or kill their prisoner, or to gain their release.  Many, many families, we were told, had to sell whatever little they had-- like pigs or a small parcel of land-- to buy off the military.

People were at the end of their rope.  Families can eat only once every several days.  He estimated that perhaps 60 percent of the MPP members had either fled or were in various conditions of hiding.  The men are too afraid to go out to the fields to work.  Their wives are doing what they can, but there are no reserves left at all.  The peasants are really suffering.

This representative of the MPP also had been arrested.  Now he had to move around from house to house sleeping in different places.  When the military came looking for him not long ago, finding only his wife at home, they told her, "We are sure you have photos of Aristide around here."  They told her to tell her husband, "We are going to get you one day."  He told us, "Around here, all of us live in fear every day."

Other MPP members who were arrested were told to quit the MPP or they would be picked up again, and this time they would end up in the cemetery.

We saw what the military had done to the MPP headquarters, warehouses, dispensary, training center --six buildings destroyed.  The military stole whatever they could.  What they could not carry they wrecked.  Doors and roofs were torn off the buildings.  At least US$ 11,000 was stolen, and thousands of peasants lost all their meager savings.  The MPP had the only printing press in the entire region.  Since it was too big to steal, the military smashed it to pieces.  Their generators were stolen, pigs were stolen, fields were burned.  Two decades of work on the part of the peasants on the Central Plateau was destroyed.  

According to Americas Watch, writing in February of this year,

Since the coup, MPP has been singled out and systematically repressed by the military: Organizers and members of the group have been arrested and forced into hiding, their fields burned, and their MPP-distributed pigs confiscated.  Numerous religious and lay leaders and ordinary citizens told us of hearing Major Charles Josel, [a.k.a. Commander Z], other officers and section chiefs vow that "There will be no more MPP!  Commander Z is perhaps the most notorious provincial military chief in Haiti.  Promoted from captain to major several months after the coup, he gave himself the nickname "Z":  Like the last letter of the alphabet, nothing is needed after him  --he is the final authority.  According to a cleric with years of experience in the Central Plateau, he arrived in Hinche after the coup with the clear, simple and public mission of smashing the MPP.  Numerous people told us that both he and the section chiefs who do his bidding in this regard say, "There is no more MPP and TKL [Ti Kominote Legliz, or popular church movement] in the Central Plateau.96 

Nor was it just the MPP and the peasant in the Central Plateau that were under attack.  In Port-au-Prince we were able to speak with members of a peasant Agricultural Association, many of whom had been forced to flee the countryside and seek anonymity in the capital.  In fact, we attended what was the first leadership meeting that they had held in over a year.

From different areas of the country we heard the same story.  The peasants cannot meet.  There is no freedom of speech.  Most peasant organizations are still in hiding.  We were told, "Our people are living in misery, we can't eat or speak."  All cooperative projects have stopped.  Soldiers had stolen typewriters and sewing machines from coop vocational schools.  Co-op handicraft centers were ransacked.  Literacy classes were outlawed.  There are ongoing house searches.

One peasant told us, "Our symbol is in the United States.  We are waiting for him.  If Aristide doesn't return we have nothing.  At this moment we have no life.  Life or death we want our government back."

 

landscape

 

"LAND OF MILK AND HONEY FOR EVERYONE"

The MPP motto is that Haiti should be the "Land of Milk and Honey for Everyone."  The Peasant Movement of Papaye grew out of the progressive church's concern in the late 1960s to reach out to Haiti's peasants, with literacy campaigns and attempts to encourage dialogue and cooperation among peasant farmers.

In the course of 20 years of work, the MPP helped the peasants of the Central Plateau achieve for themselves social services and basic infrastructure needs that the government refused to provide.  The MPP was doing what any real government should have been doing.

The MPP established a literacy program as well as promoted health education.  The MPP helped the peasants build silos, so that now over 715 million kilos of grain can be stored without rotting, and the small farmers can wait to sell at a fair price.  In its reforestation project, the MPP planted over one million seedling trees a year.  There was a training school for organizers.  The MPP distributed piglets and built a community manioc press.  Community water pumps were put in.  The MPP had the only printing press in the region.  There was a honey cooperative which increased its sale of honey to Germany more than ten-fold over the last few years.  The MPP set up dispensaries in several villages and established a credit association.  A large heavy-load truck was bought so crops could be transported to the market on time.  Small dams were being set up to provide electricity.  Community enterprises were established, where the MPP sold tools and consumer goods at wholesale prices.  Small cooperative farming groups were established.  The peasants received technical assistance.

Nineteen months after the coup nothing is left.

The leader of the MPP, Chavanne Jean-Baptiste told us that the coup was an attempt "to destroy everything which gives the peasants hope."  It was an attempt "to shut the eyes of the peasants, which were quickly opening in a new understanding."

We heard from several peasant leaders that, "Aristide didn't need money for the campaign; he didn't need a political party; he had all the peasants fighting for him."

On the day President Aristide took office there was a massive peasant rally.  The new president agreed to meet with a delegation of 80 peasants, who then presented their demands.  President Aristide told them, "On that day we will end the rural section chief," and he asked the people in their villages to nominate from among the people in their villages their own leaders.  After 200 years, the peasants had regained control over their lives.  That is how participants in the meeting expressed
it.

Before the Aristide Government, section chiefs, or the rural police, exercised total and brutal control on the countryside.  There are 565 section chiefs in Haiti, and each one has dozens of "attaches" or spies.  After the coup the section chiefs regained their lost control.  According to the head of the OAS mission in Haiti, the section chiefs receive no pay.  They are expected "to live off the land."  That means that at gunpoint they gather 20 to 30 local women to have on hand to sleep with.  That means that the peasant must pay protection money to the section chief and his men or they will be arrested.  Once arrested you have to pay to get out of jail.  You may have to pay more not to be tortured, and even more not to be killed.

The atmosphere around the Central Plateau was described in a recent New York Times article.  In a reference to the OAS/UN mission, the Times quotes the military commander in Hinche as threatening the peasants, "Anyone caught talking to observers will have their fingers and toes cut off."

Even under these conditions the MPP peasant movement survives.  The MPP has not been broken.

The section chiefs are sick and vicious people.  One prominent religious figure in Haiti explained that the section chiefs are the worst thugs armed with guns, and the "law" is their whims and desires.  

The 35,000 member Peasant Movement of Papaye was not alone.  The MPP was, as has been pointed out, closely affiliated with the National Peasant Movement of the Papaye Congress (MPNKP), with 100,000 members.  And both groups were part of the country-wide National Peasant Movement.  We heard estimates from knowledgeable sources that perhaps 40 percent of Haiti's peasants were organized into some cooperative association.

In the first few months of the Aristide Administration there was a flurry of peasant organizing drives.  Over 500 new small cooperative farming groups formed.  The National Peasant Movement announced that it was planning to organize one million new members in the next five years.  The countryside was being transformed.  Before Aristide the people were afraid, organizing was always risky.

President Aristide maintained that if his administration could end the massive corruption draining the government's tax and customs revenues, perhaps over $340 million could be raised.  According to the President, "This money could buy fertilizers and tools for the peasants."

For Aristide, the peasant "is the engine of change... Potatoes do not grow in state offices.  Bananas do not grow in the president's office.  Corn and rice do no grow in the National Palace.  It is in the peasants' yards."

The President wanted to introduce Creole, along with French, as the national languages.  The peasants did not speak French.

These reforms that were awakening the peasants-- 80 percent of the population-- threatened to break once and for all the total grasp Haiti's tiny business elite had held over socio-economic power in Haiti for the last 200 years.

The MPP also offered the peasants a democratic, participatory, grass roots model of economic development that allowed them control over their own lives and culture.

David Korb, an independent journalist and filmmaker who has worked in the Central Plateau on and off over the last four years knows the MPP well.  According to Korb, writing in New York Newsday, the MPP's "model for economic development at the grass roots is a symbol to tens of thousands of rural peasants, who have been inspired by its promise of collective organization to bring about change.  Groups such as MPP are inventing nonviolent means to refashion established economic, political and cultural institutions to suit their members' needs."

The head of the OAS mission in Haiti told us that in the Central Plateau "the MPP calls the shots."  A foreign cleric with over a decade's work in Haiti explained that 85 to 90 percent of the families in the region around the provisional capital of Hinche belonged to the MPP.  "Oh, I would say almost all the families around here are somehow connected to the MPP.  Now that the MPP can't function, we've lost our water and electricity.  Everything has been stopped," and she shook her head in sadness and disgust.

This April, the MPP won prestigious Brown University's Alan Shawn Feinstein World Hunger Award.  The award came with a $25,000 check to the MPP.  Accompanying Chavanne Jean-Baptiste in receiving the award was MPP co-leader Madame Irama.  When Madame Irama set out in a crowded truck-- the only transportation the peasants have--  from the Central Plateau to make her way to Port-au-Prince to apply for her visa to visit the U.S., soldiers grabbed her at a checkpoint.  She was held for several hours and so badly beaten that her eyesight and hearing have not fully recovered even a month after the incident.  Madame Irama won her release through immediate OAS pressure.

The Peasant Movement of Papaye (MPP) has never received assistance from the U.S. Agency for International Development.  Not a penny.  What could be so wrong here?  How can USAID have poured over $100 million into Haiti to assist private sector businesses-- often controlled by a tiny backward elite-- and not give one single dime to support projects of the popular peasant organizations like MPP and the National Peasant Movement.  After all, the military was out to destroy the MPP.  They had placed a $10,000 bounty on MPP leader Chavanne Jean-Baptiste's head, yet no one turned him in.  That sounds like powerful grass roots support.  The MPP was doing what the Haitian government should have been doing.

We heard other disturbing allegations that at least one USAID-funded CARE food program in the Northwest of the country had turned away starving peasants who were members of the National Peasant Movement.  They were told:  "This is the Government's food, this is Bazin's food. You can go to Chavanne or wait for Aristide."  Several days after this incident, one of the peasants who was turned away died of starvation.

Cases like this need to be thoroughly investigated, if the U.S. Agency for International Development is ever to regain its proper mission --i.e. "alleviating the worst manifestations of poverty."

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THE WHITE HOUSE SEEKS APPEARANCE OF MODEST REFORM/EVEN THAT FAILS

The Reagan Administration said it wanted to help Haiti.  So on June 13, 1986, the White House invited business leaders with interests in Haiti to a briefing at the Indian Treaty Room.  Secretary of State George Schultz led the briefing, along with USAID Administrator Peter McPherson and OPIC President Craig Nalen.  Investors were encouraged to remain in Haiti.  According to the minutes of the meeting the Administration acknowledged that,

Labor/management relations under the Duvaliers were artificially calm and heavily skewed to management --workers could be fired at will, and with massive unemployment, strikes or protest was unknown.  There was little incentive to improve working conditions or permit worker organizations.97

After the Duvalier dictatorship fell problems began to emerge, i.e. in the investment climate.  The briefing book continues: 

In one manifestation of the loosening of constraints which occurred throughout Haitian society after February 7, a rash of strikes broke out in the private and public sectors.  Initially, the focus was on removal of `Duvalierists' in the public sector, but it quickly spread to wages and working conditions.  Numerous U.S. and Haitian-owned factories were affected.  Workers demanded radical wage increases.  These were reduced to mutually acceptable levels after worker/management consultations.

As the briefing book notes, in the face of this crisis the Reagan Administration moved quickly "to restore international business confidence in the export assembly sector since the fall of the Duvalier regime."  USAID began working with the Haitian business community to provide them, "...with technical assistance in labor relations, development of a business oriented public relations campaign, and intensified efforts to attract U.S. products assembly operations to Haiti."

USAID wanted to, "educate the export assembly industry's management and work force about plant management, positive labor relations, and a number of positive social programs designed to show the private sector's commitment to social and economic development issues."98

But even this modest effort, to begin to raise the issue of labor's rights along side those of management, drew the vehement scorn of U.S. companies.  It did not matter that respect for basic internationally recognized worker rights was a part of U.S. trade law, and that these laws definitely applied to commerce with Haiti.  The most fundamental worker rights are the freedom of association and the right to organize.

Writing in Bobbin Magazine in 1991, Norman Gelber reported that U.S. government interest in the rights of labor in Central America and the Caribbean was seen by U.S. "Apparel operators as unnecessary meddling by the U.S. Government --without concern for the effects on U.S. corporations operating in these zones," --the export processing zones throughout the region.  According to the Bobbin article, Andrew Postal, President of the apparel firm Judy Bond, said he was nearly run out of Haiti in 1987 by "the  aggressive U.S. policy to enforce unions in Haiti, whether they needed them or not.."  Postal continued that raising labor rights issues --albeit the law-- "caused more people to pull out of Haiti than Duvalier's overthrow."99  

The companies played hardball and they won.  No union collective bargaining agreement has ever been signed in Haiti's export assembly sector. In 1991, Andrew Postal could brag, "our operations in Haiti are running very well..."

CBI...A RACE TO THE BOTTOM  

A Roach, Jr. had it pretty good.  In 1983, his company, TII Industries, Inc. of Copiague, New York was producing telephone, power and electronic protection devices which he sold to customers like General Electric, Nynex, Southern Bell and Ameritech.  Roach did most of his manufacturing in Puerto Rico where he had 465 employees whom he paid three or four dollars an hour.  Not only was Roach saving on what his mainland U.S. wage costs had been, there was also Section 936 of the Internal Revenue Code.  Section 936 is a tax loophole benefiting U.S. companies with subsidiaries in Puerto Rico which exempts them from having to pay federal --and most local-- corporate taxes on their profits.

Then, in 1984, the Reagan Administration's Caribbean Basin Initiative (CBI) entered the picture.  Al Roach, Jr. was asked to join the Presidential Task Force on CBI.  Roach was a quick learner.

By 1986, Al Roach was reporting back to TII Industries' stockholders that the company had: 

[taken] advantage of the Reagan Administration's Caribbean Basin Initiative by shifting additional labor intensive assembly work to our facility in Haiti and to new plants in the Dominican Republic.  The sharply lower, world competitive wage rates in these countries, coupled with the incentives of the Caribbean Basin Initiative have opened two important avenues toward long-term corporate growth.100

After joining Reagan's Presidential Commission on CBI, Roach opened a plant in Haiti in 1985, and a year later opened four more plants in the Dominican Republic.  With CBI, Roach had a way to escape paying even the $3 or $4 an hour prevailing wages in Puerto Rico.  Under the "Twin Plant" program, TII Industries was able to keep its 936 tax break on all corporate profits, while at the same time splitting its manufacturing process, keeping some work in Puerto Rico and sourcing out the labor intensive assembly operations to his plants in Haiti and the Dominican Republic.  In Haiti and the Dominican Republic, Roach could pay his workers between 30 to 58 cents an hour.  Roach himself explained the CBI process: 

No magic or secret formula is involved.  It's simple arithmetic with two basic factors:  Section 936 of the Internal Revenue Code and world-competitive wage rates for labor-intensive production.  

A participating company builds one plant in a Caribbean country to do the unskilled part of a job and a second plant in Puerto Rico for the skilled finished work.  In the Caribbean the company benefits from low wage rates --about 70 [cents] an hour for the average industrial worker.  In Puerto Rico, it benefits from U.S. tax law exempting profits from operations there."101

Not only that, but TII's products made in the Caribbean can then enter the U.S. duty free.  In TII's 1988 annual report, Roach informs the stockholders that, "Under the Caribbean Basin Initiative it is possible to assemble component kits which originate in the United States and return them to the U.S. without duty..."102

Roach could boast that his labor costs in the Dominican Republic and Haiti were six percent of what he would have to pay in New York State.  The vicious cycle was in full swing.  TII Industries' 1991 annual report explains that, "By moving its manufacturing operations to the Caribbean, TII Industries has become one of the lowest cost producers of overvoltage protection, network interface, and station electronic equipment for the telecommunications marketplace."103  The next step is quite logical.  Roach stated his intentions:  "...I can cut the price below what anyone else has."104

Roach then set out to "help other American companies achieve the same objective."  Roach "established a wholly owned subsidiary, Caribbean American Manufacturing, Inc. which will subcontract TII's low cost Caribbean labor force and its technically advanced manufacturing facilities in Puerto Rico to American companies for use in labor intensive manufacturing processes."105

In 1986, TII Industries's sales jumped 22 percent to $38 million, while its net income more than tripled.  According to Roach, it "was a rewarding year for TII Industries."

Under CBI and 936, TII Industries pays no federal corporate tax on its Caribbean operations, can pay wages six percent of New York State's, and can import into the U.S. market without paying duty.

It is interesting to learn what an insider, like Roach on the Presidential Task Force on the CBI, really thought of the Caribbean Basin Initiative.  Roach was a real visionary when it came to the CBI.  "Believe me," said Roach, "thar's gold in the CBI, and farther down the road there may well be golden doors to be opened for the Caribbean, Central, and both hemispheric Americas."  Roach believed that:

Thousands of American firms could profit substantially by participating, either directly by relocating part of their manufacturing facilities or indirectly by subcontracting to companies already established in the CBI.  By doing so, they can help themselves and their stockholders, and at the same time enhance the economies (and security) of the countries in the Caribbean.106

How was Roach going to help the economies of the Caribbean?  In 1983, TII Industries had 465 employees in Puerto Rico.  By 1991, this total had been cut by 60 percent, to 185 employees.  TII was expanding not in Puerto Rico or mainland U.S. but in the Dominican Republic and Haiti to access the prevailing starvation wages in these countries.  When the first constitutionally elected government in over 200 years came to power in Haiti, Roach pulled out.  With the help of a two million dollar U.S. government loan from OPIC, TII shut down its 38,000 square foot factory in Port-au-Prince and opted to nearly double its operation in the Dominican Republic to 70,000 square feet of factory space housing 550 employees.

TII's 10-K tax filing notes that this $2 million OPIC loan "will be reserved for use principally in the company's facilities in the Dominican Republic primarily for capital projects..."107

It is hard to see how anyone, other than Roach and his shareholders, gained from CBI.  In this case, Puerto Rico lost 280 jobs;  during this period, real wages in the Dominican Republic actually declined by over 30 percent;  TII paid no taxes in Puerto Rico, Haiti or the Dominican Republic, and imports entered the U.S. duty-free.  At least 74 percent of TII's workforce was now offshore, and it appears that TII closed two small plants in the U.S. in 1984-85, in Lindenhurst and Setauket, Long Island.  Why were U.S. government funds used to help TII Industries flee Haiti?  Some of the more than 194,000 U.S. electronics workers who have lost their jobs since 1979 might also be interested to know that TII has paid no federal or state income tax at all --even beyond its 936 tax loophole-- for the last three years.

Roach must have fit in well with the business team the Reagan Administration formed to guide CBI.  Roach felt that the U.S. had hurt itself because we had "bankrolled the Third World over the last 40 years."  Roach was also angered by what he believed to be a "Congress more interested in overspending and more dedicated to welfare and giveaway programs than to the vitality of private business..."108 --like his own.  Roach looked at CBI as his "payback" and rightful due, and he set about ripping off the U.S. taxpayer and workers in the U.S. and the Caribbean.  

kellwood 

 

"HAITI AN IDEAL HUNTING GROUND"

Kellwood Industries, with over $900 million in annual sales, is an apparel and home furnishings company headquartered in St. Louis, Missouri.  In 1981, Kellwood had 16,000 employees in 62 plants across the U.S.  At that time Kellwood had no offshore production.  By 1992, Kellwood had cut its U.S. workforce by 59 percent, dropping 9,500 domestic jobs and closing over 50 U.S. plants.  Today 58 percent of Kellwood's workforce is offshore.  Kellwood has 8,900 offshore employees as compared to 6,500 U.S. workers.  What happened?

In 1984, New York Times reporter Clyde Farnsworth interviewed Mr. Dale G. Lockamy in Haiti.  Lockamy was Kellwood's overseas operations manager.  Farnsworth wrote that, "one of Mr. Lockamy's tasks is to find the best sites for the [Kellwood's] operations.  Lately, he has found Haiti an ideal hunting ground."  According to the June, 1984 New York Times article:  

...tiny Haiti --jammed with 6 million people, most of them unemployed-- is emerging as the low-wage capital of the world, the Taiwan of the 80's, for operations like Kellwood's that seek pools of inexpensive labor.  The prevailing Haitian wage is only $2.65 a day, which is about as low as pay anywhere in the world, most studies show.  In addition, the Haitian worker is famous for industriousness.  And President Jean-Claude Duvalier has added another incentive for investment:  up to 15 years of exemptions from Haitian taxes for foreign companies that locate in Haiti...
 Moreover, the Reagan Administration is going out of its way to encourage American companies to set up shop in Haiti.
109

Lockamy was in Haiti, where apparel workers were being paid 33 cents an hour to set up a sourcing contract with a Haitian firm for the production of women's lingerie and other clothing for Kellwood.

Kellwood's strategy was being shaped by the CBI and other related government incentive programs encouraging offshore production.

By 1985, according to Kellwood's annual report, the company had:  

...expanded its 807 manufacturing facilities in Central America and the Caribbean Basin.  Most of the manufacturing is performed through contract operations;  however, we have established a lingerie facility in Haiti.  More company-owned factories are planned for this year.  Under 807 tariff regulations, fabric is cut in the United States and shipped offshore for assembly.  The product is then returned to our country at a more favorable tariff rate than pure imports.

This trend continued.  Kellwood's 1988 annual report noted that the company had, "brought about the closing of marginal and surplus domestic operations with selected production being moved to low-cost Caribbean plants..."  In the same breath it was proudly observed that, "Kellwood Company achieved record sales and earnings for 1988, continuing its eight-year trend in earning growth."

In 1989 and 1990, Kellwood closed at least six U.S. plants, which along with a mass layoff at its Greenfield, Tennessee factory, left over 1,495 U.S. workers jobless.

One of the Kellwood plants that closed was in Altus, Oklahoma where approximately 260 women cut and sewed women's lingerie and sports clothing for Sears, Hanes, Nike and Adidas, among others.  The Kellwood plant had been operating in Altus for 17 years, and to help keep it there the town was not charging Kellwood any property tax.  Workers were generally paid the minimum wage.  However, some sewers who strained to exceed their quota could earn as much as $5.50 an hour.  The company provided modest health, vacation and retirement benefits.

Kellwood shut its Altus plant in May, 1990.  According to Larry Toones, Director of Economic Development in Altus, "The closing had a bad impact on the community, our sales tax went down but the unemployment rate rose..."110

The workers were only told that the plant was closing due to "reorganization."  However, at the same time production was being phased out, one of the workers noted that "several of the male supervisors, engineers and mechanics were sent to Haiti to train the workers there and to teach the Haitian mechanics how to repair machinery."  When asked how she felt about this, she told us, "We were all really mad.  Our work was being shipped abroad to workers who were getting less than a dollar an hour."111

This is exactly what Kellwood was doing, and continues to do.  It was using the CBI to pit poor U.S. workers, most of them women, against young women and teenagers in Central America and the Caribbean who are forced to work for 30 or 40 cents an hour.

In 1990, the same year Kellwood shut down its Altus facility and several other U.S. plants, Kellwood's Chief Executive Officer, William J. McKenna, received $4,345,059 in salary, bonuses and stock options.  At the wage Kellwood was paying in Haiti, McKenna was making more than 3,200 Haitian workers would have earned in an entire year.

Kellwood seems pleased with itself.  In its 1992 "Merrill Lynch Presentation" Kellwood reviews "The 1980's--A Decade of Transition".  Listed among the "Corporate Objectives" --throughout this period and up to the present-- is to, "Implement Global Sourcing."  Under its "Action Plan" Kellwood highlights the fact that the company had "completed closure of 44 domestic facilities" by as early as 1986.   In the report's Summary section, Kellwood notes that it will continue to go after "low cost worldwide manufacturing and sourcing."112

Kellwood is another CBI winner that is pitting U.S. and Third World workers against one another in a race to the bottom to see who will accept the lowest wages and the most miserable working conditions.  Today, Kellwood is expanding production in Honduras, Sri Lanka and China
 
LABOR RIGHTS LINK WORKERS IN U.S. AND HAITI

In 1988, Zwicker Knitting Mills shut down its Waupaca, Wisconsin plant, costing 200 Amalgamated Clothing and Textile Workers Union (ACTWU) members their jobs.  The plant had been in operation since 1955.  Zwicker's plant in Appleton, Wisconsin was also being down-sized.  The work was being sent to Haiti.

In 1988, Zwicker was a profitable company with sales of approximately $60 million.  Zwicker manufactured gloves, mittens, coordinated hat and scarf sets, knee socks, legwarmers, and children's and teens' clothing.

Zwicker felt it could increase its profits by shipping out the labor intensive operations on its gloves and mittens to its plant in Haiti where it paid its 327 workers 38 cents an hour with no benefits.  Nor did Zwicker allow its Haitian employees any breaks during the day other than lunch.  The plant had no cafeteria and no safe drinking water.  Nor was there even a toilet.  There was one outhouse for all 327 workers.  Toilet paper was not supplied.

In May of 1988, when the workers protested against the miserable working conditions, Zwicker management brought a group of armed civilians into the plant to seize and evict 12 union leaders, who were immediately fired and blacklisted.  When the workers persisted and held a second demonstration, 27 more workers were fired.  In July 1988, five more union organizers were fired and blacklisted.113
A calculated greed, which backfired, was driving Zwicker.  The company went bankrupt in 1991, just as it was closing another plant in the U.S. to further expand its production in Haiti and China.

It is not totally surprising that company management such as Zwicker's exists.  The Reagan and Bush Administrations fed these behaviors by paying so little attention to job loss in the U.S. and to worker rights in Central America and the Caribbean while at the same time promoting CBI and U.S. investment offshore.  This has proven to be a prescription for raising corporate greed to the highest common denominator, while reducing wages and working conditions to the lowest.

In 1984, Mr. Greogoire Eugene, the leader of Haiti's Social Christian Party observed:  "I think that American enterprises that pay their workers back home at least $3 an hour can be convinced to pay Haitian workers at least $6 a day, without inconvenience."  Mr. Eugene said he planned to call for an investigation of health and safety conditions at the export assembly factories in order to press for adequate health, safety, wage and benefits legislation.  "Foreign investment," the Social Christian Party leader said, "must have a social vocation.  If it comes here merely to exploit the worker, it is immoral and will not be tolerated."114

USAID and other U.S. government agencies involved in implementing CBI --the same groups which are involved in shaping the North American Free Trade Agreement (NAFTA)-- failed to hear the concerns of the Haitian people.  As we have seen, USAID raced in the opposite direction and into the arms of Haiti's business elite to oppose a minimum wage increase that was being proposed by the country's first democratically elected government.  Under the Reagan and Bush Administrations working people did not matter.  CBI policy was driven by the corporations' bottom line.

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REFUGEE SITUATION

(This section was written by delegation member Muzaffar Chishti, Director of the Immigration Project of the International Ladies Garment Workers Union and Secretary-Treasurer of the National Coalition on Haitian Refugees.) 

Two members of the delegation met with Williams Coracelin at the National Penitentiary in Port-au-Prince on the morning of March 14, 1993.  An international incident involving Coracelin had taken place two days before the delegation arrived in Haiti.  Coracelin, a Haitian navy deserter, had been granted political refugee status by the U.S. embassy in Port-au-Prince.  On March 11, 1993, as he was being escorted by U.S. diplomats to board a plane for the U.S., Coracelin was arrested by the Haitian army at Port-au-Prince airport on an eight month old arrest warrant for desertion.  

The hour-long meeting with Coracelin provided a detailed account of his decision to desert, his prior attempts to escape Haiti on the high seas and seek asylum, and his arrest at the airport.  The Coracelin story, in poignant terms, illustrates the fundamental fallacy of the U.S. policy toward Haitian refugees.

The current chapter in the checkered history of the U.S. treatment of Haitian refugees began soon after the overthrow of President Aristide in September of 1991.  Haitians fearing persecution and seeking political asylum immediately took to the high seas.  (This was in sharp contrast to the eight-month long Aristide presidency which witnessed a virtual halt to the flow of Haitian boat people).  Fleeing Haitians in boats were interdicted by the U.S. Coast Guard and over 35,000 of them were screened for asylum claims, first on the Coast Guard cutters and later at the U.S. Naval Base in Guantanamo Bay, Cuba.  Over 10,000 of these have been paroled into the United States for further hearings.  (Approximately two hundred of these have been found HIV positive and remain incarcerated at Guantanamo).

On May 25, 1992, President Bush reversed the screening policy and ordered the Coast Guard to intercept Haitian boats and return them directly to Haiti. Thus fleeing Haitians no longer have the opportunity even to present a claim for political asylum.  Haitians fearing persecution were advised to apply for refugee status at the U.S. embassy in Port-au-Prince.

The blanket repatriation policy of President Bush, loudly condemned by President Clinton during the Presidential campaign, became the Clinton policy after the election.  Preventing a specter of an exodus --and the perceived political fallout from it-- has obviously dominated U.S. policy toward Haitian refugees and toward Haiti in general.

However, this political calculation does not dilute the inherent legal and moral dilemma posed by our policy on Haitian refugees.  The executive order that authorizes blanket repatriation is a violation of our obligations under international law, and an unfortunate precedent for the international community.  The law explicitly says (and the U.S. Court of Appeals for the Second Circuit agreed) that no refugees are to be returned by a country without determining whether they are fleeing political persecution; and if so, they are not to be returned under any circumstances.  Clearly, many Haitians who take to the high seas are in fact political refugees.  Coracelin's example is a case in point.  He deserted the Haitian army after he refused to obey an order to execute two peasant leaders.  Having deserted and fearing arrest, he went into hiding for a few months.  In May of 1992, he managed to leave Haiti on a boat.  He was picked up on the high seas by the U.S. Coast Guard soon after the executive order went into effect.  The captain of the Coast Guard cutter recognized the risk in repatriating someone like him.  But given the severity of the new policy, he had no choice but to return him-- back to his potential persecutors.

The U.S. Administrations's answer to the Haitians fearing persecution is to invite them to apply for refugee status at our embassy in Port-au-Prince.  The inherent dangers of this "in-country" processing are self-evident.  The very act of an attempt to apply at the U.S. embassy in Port-au-Prince is to invite retaliation against oneself or one's family.  And, as the Coracelin case highlights, even when someone braves the odds, the system in place is blatantly insecure.  The system provides no protection to those who apply, or to those who are granted the status before they leave the country.  When even a high-profile refugee like Coracelin could not be protected from the long reach of the Haitian army, one has to cast serious doubts on the integrity of the "in-country" refugee processing in Haiti.

Back to top


CONCLUSION:  HAITI AND BEYOND TO NAFTA

Last fall, the National Labor Committee (NLC) exposed an array of government programs, in place since the early 1980's, which used over $1.3 billion in U.S. tax dollars to orchestrate, finance and assist company flight from the U.S. to low-wage industrial parks in the Caribbean Basin region.  The U.S. Agency for International Development (USAID) was financing the development of industrial parks and factory space, as well as providing soft loans, technical assistance, and subsidized worker training for companies relocating offshore.

The labor committee also documented that U.S. Government officials were aware that U.S. companies were illegally firing and blacklisting workers who tried to organize their offshore factories in these USAID-financed industrial parks.

The National Labor Committee's exposé, Paying To Lose Our Jobs, focused the nation's attention on what became known as USAID's "jobs export program."  The issues raised by the NLC were featured on CBS "60 Minutes", two ABC "Nightline" shows, CNN, Fox 5 News, the "Phil Donahue" show, National Public Radio, a host of local T.V. and radio stations, as well as in over 100 major newspapers across the country.  The issues raised by Paying To Lose Our Jobs became a part of the Presidential and Vice Presidential debates, as well as in Congressional trade policy debates surrounding the elections.

Within a week of the release of Paying To Lose Our Jobs an amendment passed both houses of Congress and was attached to the FY 1993 foreign appropriations bill.  The amendment prohibits USAID from providing:

* "Assistance for any project which contributes to the violation of internationally recognized workers' rights;...
* financial incentives to enterprises within the United States to relocate outside the United States;...
* any assistance to establish or develop export processing zones in foreign countries..." 
 
At the request of Congressmen Brown, Hamilton, Harkin and Leahy, the General Accounting Office (GAO) initiated the first review of U.S. Government CBI and related programs that assist company flight from the U.S. to the low-wage Caribbean Basin region.  The GAO report is due to be released in September.

In November 1992, the head of USAID, Ron Roskins resigned. Today, it appears that USAID is the subject of a large scale ongoing review and reform process.

In the fall of 1992, one polling group found that the issue of plant closings and plant relocations offshore with the assistance of U.S. tax dollars was the number one issue in the country.

President Bill Clinton and Vice President Al Gore read Paying To Lose Our Jobs, and the questions it raised must have left a strong and lasting impression.  On March 23, at the president's first official news conference at the White House, he was asked about the impactof the North American Free Trade Agreement (NAFTA), if it were to go  through.  President Clinton knew what we did not need in NAFTA.  He responded:  

We have examples in our AID program where the United States spent taxpayers' money to encourage American companies to invest in Central America, who went down there and actually lowered wages instead of raising them in the host country. 

This is what the Caribbean Basin Initiative (CBI) was all about.  U.S. companies went offshore with the assistance of U.S. tax dollars; cheap imports poured into the U.S., and at the same time real wages drastically declined across Central America and the Caribbean.  The Reagan and Bush Administrations saw the CBI as a precursor to and test of larger free trade agreements like NAFTA.  CBI had to fail.  Under Presidents Reagan and Bush CBI had two main focal points, investment diversion from the U.S. and maintaining extremely low wages in the Caribbean Basin region.  This is why USAID opposed a minimum wage increase in Haiti, one of the poorest countries in the world, but a not insignificant Caribbean exporter of cheap assembled goods to the U.S.

CBI's stated concern for economic and social development in Central America and the Caribbean and for the protection of basic worker rights was mere window dressing.  This was a low wage strategy, pure and simple, to give U.S. companies access to labor costs less than 10 percent of those in the U.S.

In Haiti, the National Labor Committee found the same disturbing pattern of USAID's heavily financing a very tiny, and very corrupt business elite.  We found that just as Haiti's export of assembled goods to the U.S. increased, real wages for the factor workers were slashed by more than half.  Labor rights violations in Haiti were rampant throughout the 1980's, and, to date, there is not one single collective bargaining agreement in place in any U.S. or Haitian firm exporting to the U.S.

What happens next in Haiti has great significance for the development of democracy, extending well beyond Haiti's borders and touching all of Latin America.  Also, as negotiations in Haiti intensify to clear the way for the return of President Aristide and the democratically elected government, one of the major issues emerging as key to the settlement is the need to put in place a large scale international development assistance package for Haiti.

After the last 19 months of destructive military rule, Haiti is worse off than it has ever been.  A massive international aid effort is critical if Haiti is to survive, as is large scale new investment in Haiti by the private sector.  Haiti, perhaps as much as any country in the Western Hemisphere, also needs strong union and peasant organizations if it is to recreate its civil society.

Given the long historic ties of the United States with its close neighbor, Haiti, the U.S. government should lead the international community's efforts to provide real and significant development assistance to Haiti.  What must be avoided, however, is a repeat of USAID's past performance in Haiti and its overly-close support role for the tiny corrupt business elite that has dominated that country so ruinously.  If U.S. foreign assistance programs follow these same failed patterns, then U.S. aid will continue to propagate the very economic and political conditions which led to the coup.  Real development led by new investments in Haiti, rather than investment diversion from the U.S. and worker rights guarantees with teeth in them must be the new focal points guiding U.S. development assistance.

There are significant ties which link U.S. and Haitian workers and also extend beyond Haiti's borders.  After all, the same U.S. government agencies, USAID, OPIC, Commerce and the Labor Department, which brought us the failed Caribbean Basin Initiative and counterproductive policies in Haiti are the very agencies and staff which are --right now-- behind closed doors, shaping and promoting the NAFTA agreement.  We need a new U.S. government response to Haiti, just as we need a new response to NAFTA.

We must try to understand what the Bush Administration did in Haiti that drove a main-line Haitian labor federation, OGITH, to appear before an International Labor Organization meeting in Geneva in June 1992 to make the following desperate appeal to:  

...the delegates and workers present to convince their respective governments, members of the United Nations, to persuade the Government of the United States and its ambassador in Haiti to change their policy vis-a-vis the courageous people of Haiti, who have committed no other sin than that of wishing to recover their national dignity...The workers, the trade unions and the people of Haiti are committed to stand by President Jean-Bertrand Aristide and the Government of his Prime Minister in the difficult task of starting again a democratic process, aimed at establishing a state based on the rule of law and a just society in Haiti.

The U.S. labor movement has a major support role to play in Haiti, if we are to help turn around the content, and image, that past U.S. government policies have among the working people in Haiti.

 

 

conclusion

 

 


 

RECOMMENDATIONS OF THE DELEGATION

1. Immediately tighten the Embargo.  Until the generals step aside and the consitutional government led by President Aristide returns to Haiti, the U.S. should work with the UN/OAS to immediately tighten the embargo.  The flow of oil into Haiti must be stopped.  All U.S. assets of the military and their supporters in the Haitian business community should be frozen, and the visas of all coup-supporters and their families should be revoked.

2. End the illegal interdiction of Haitian refugees.  The current policy of blanket repatriation of Haitian refugees picked up on the high seas should be terminated immediately.  An equitable, humane and lawful screening procedure should be put in place in order to guarantee that no one who has a well founded fear of persecution will be returned to Haiti.

3. A massive aid package is necessary.  Haiti is the poorest and most devastated country in our hemisphere.  The $40 million annual aid package for Haiti being proposed by the Clinton Administration would not even equal what was given to Baby Doc and the military.  We urge the Clinton Administration to do much more to alleviate the desperate poverty in Haiti and to support the first democratic government in Haiti's 204 year history. 

Haiti's recovery will require a massive international foreign assistance effort.  The U.S. contribution of $200 million over a five year period as  part of the one billion dollar multinational assistance package which is being discussed now is not enough.  Over a billion dollars a day was spent by the developed world to liberate the tiny emirate of Kuwait during the Iraq war. 

Between 1980 and 1985, U.S. assistance to the Duvalier dictatorship totalled over $250 million.  From 1986 to 1990, through a succession of military governments, Haiti received over $341 million dollars, approximately $68.2 million annually.

4. USAID's Private Sector Program in Haiti should be suspended immediately.  After actively opposing the minimum wage increase proposals of Haiti's constitutional government, the credibility of USAID's private sector program has been badly tarnished.  All funding for AID's Haiti private sector program should be suspended pending a full public review by Congress and the Administration.  Given the desperate crisis facing the Haitian people, all monies from this private sector program should be redirected to support the humanitarian needs of the population, including food, medicine, health services, education, seeds and agricultural tools.  A public works program should be undertaken to create jobs and begin to rebuild Haiti's shattered roads and inadequate water and sewer systems.  Reforestation and long range efforts to improve Haiti's energy production are critical needs.

5. Reforming the Haitian Military.  Before the U.S. military assumes a role in reforming the Haitian military, several questions need to be addressed.  Between 1986 and 1991, the Haitian military received $5.9 million in assistance.  Hundreds of thousands of dollars went into the International Military Education and Training Program.  It is important to clarify which Haitian officers received training through this program in light of their roles in the coup d'etat.  Further, what riot control and other equipment were given to the Haitian military which may have been used to repress the population following the coup?  All information regarding Haitian military involvement in drug running to the U.S. should be made public.

6. U.S. trade law guaranteeing respect for internationally recognized worker rights must be enforced with teeth, and not the backpeddling of the Bush Administration.  Also, the U.S. Commerce Department and USAID should make it standard practice in dealing with U.S. companies operating in or sourcing from Haiti to encourage these firms to adopt  corporate codes of conduct guaranteeing the worker rights of their employees.

7. The First Thorough Survey of Working Conditions.  The U.S. Labor Department should undertake the first thorough investigation of wages, benefits, hours, working conditions and actual labor rights protections of workers employed in Haiti's export sector producing for the U.S. market.  The workers' health and living conditions should be accurately profiled. 

A comprehensive list of U.S. companies sourcing from or producing in Haiti should be developed along with a profile of the wages, benefits, working conditions and labor rights protections in these plants.

8. The ICFTU Request to be Part of the UN/OAS Peacekeeping Force.  We strongly support the request by the International Confederation of Free Trade Unions (ICFTU) to be part of the UN/OAS observer mission monitoring the restoration of democracy and institution rebuilding in Haiti.  We urge the Clinton Administration to present and support this request to the UN/OAS.  Given the crucial role that unions and peasant organizations will play in rebuilding Haitian society, it is fundamental that the UN/OAS team be sensitive to the needs of labor.


 

NOTES:

1. Haiti: Foreign Labor Trends Report, 1989-1990, U.S. Department of Labor, Bureau of International Labor Affairs

2. Foreign Broadcast Information Service (FBIS) [Haiti], 1 March 1993.

3. "Haiti," Caribbean UPDATE, March 1992.

4. "Attorney for Wealthy Haitians Criticized for Role in U.S. Talks," The Journal of Commerce, March 4, 1993.

8. Ibid.

9. "An industrial park on the way up," Hispaniola Business, October 15, 1990.

 10. Coversation on April 22, 1993 with Nina Gressens from the U.S. Department of Commerce

11. "Haiti," Foreign Economic Trends and Their Implications for the United States, American Embassy Port-Au-Prince, U.S. Department of Commerce, International Trade Administration, April 6, 1992.

12. M. Catherine Maternowska, Ph.D. Candidate at the Anthropology Department of Columbia University, New York, New York.  Also see Concept Paper Economic Recovery Assistance II, USAID/Haiti, November 1986.

13. Investment in Haiti, Ministry of Economy, Finance, and Industry; Investment Promotion Division [Haiti], 1983.

14. Haiti: Foreign Labor Trends Report, 1989-1990, U.S. Department of Labor, Bureau of International Labor Affairs.

15. "Haiuti," EIU Country Report No. 4, 1992, The Economist Intelligence Unit.

16. Investment in Haiti, Ministry of Economy, Finance, and Industry; Investment Promotion Division [Haiti], 1983.

17. Haiti: Foreign Labor Trends Report, 1989-1990, U.S. Department of Labor, Bureau of International Labor Affairs.

18. "Haiti," Foreign Economic Trends and Their Economic Implications for the United States, American Embassy Port-Au-Prince, U.S. Department of Commerce, International Trade Administration, April 6, 1992.

19. "Haiti," Project Paper/Promotion of Business and Export Project (Amendment Number 1/Project Number: 521-0186), USAID, June 29, 1991.

20. Strategic Options for Haiti's Promotion of Business and Exports (Probe) Project, USAID, June 1991.

21. "Foreign Economic Trends and their Implications for the United States," U.S. Department of Commerce, May 1989.

22. Ibid.

23."Haiti," Project Paper/Export and Investment Promotion (Project Number: 521-0186), USAID, August 8, 1986.

24. Ibid.

25. Country Development Strategy Statement: FY 1986: Haiti, USAID, January 1984.

26. Ibid.

27. Ibid.

28. "Haiti," Foreign Economic Trends and Their Implications for the United States, American Embassy Port-Au-Prince, U.S. Department of Commerce, International Trade Administration, April 6, 1992.

29. The Electrotechnical Industry in Haiti, The Ministry of Economy, Finance, and Industry; Investment Promotion Division [Haiti], 1981 (Estimated).

30. "Haiti," Project Paper/Promotion of Business and Export Project (Amendment Number 1/Project Number: 521-0186), USAID, June 29, 1991.

31. "Haiti," Foreign Economic Trends and Their Implications for the United States, American Embassy Port-Au-Prince, U.S. Department of Commerce, International Trade Administration, April 6, 1992.

32. "Haiti," Caribbean UPDATE, May, 1991.

33. Haiti: Foreign Labor Trends Report, 1989-1990, U.S. Department of Labor, Bureau of International Labor Affairs.

34. "Haiti Macroeconomic Assessment," Staff Working Papers, USAID, February 1991.

35. Ibid.

36. "Haiti," Project Paper/Promotion of Business and Export Project (Amendment Number 1/Project Number: 521-0186), USAID, June 29, 1991.

37. Ibid.

38. Ibid.

39. Strategic Options for Haiti's Promotion of Business and Exports (Probe) Project, USAID , June 1991.

40. "Haiti," Project Paper/Promotion of Business and Export Project (Amendment Number 1/Project Number: 521-0186), USAID, June 29, 1991.

41. LAC Regional/Project Paper, American Institute for Free Labor Development, United States International Development Cooperation Agency; Agency for International Development, August 8, 1990.

42. Haiti - Economic Policy & Trade Practices, eTP910200, U.S. Department of Commerce, International Trade Administration, 1991.

43. "Haiti," Project Paper/Promotion of Business and Export Project (Amendment Number 1/Project Number: 521-0186), USAID, June 29, 1991.

44. Ibid.

45. "Priest-President," The Economist, December 22, 1990.

46. Caribbean Basin Initiative: Impact on Selected Countries, Unted States General Accounting Office, July 1998.

47. Labor Profile: Haiti, July 1982, Department of Labor, Bureau of International Labor Affairs.

48. "Haiti Macroeconomic Assessment," Staff working Papers, USAID, February 1991.

49. Ibid.

50.  Strategic Options for Haiti's Promotion of Business and Exports (Probe) Project, USAID , June 1991.

51. Ibid.

52. "Haiti," Project Paper/Promotion of Business and Export Project (Amendment Number 1/Project Number: 521-0186), USAID, June 29, 1991.

53. Ibid.

54. Ibid.

55. Ibid.

56. "Financial Scandal at Prominex: US$2 Million Stolen in 2 Years," Petit Samedi Soir, February 11-17, 1989.

57. "Haiti," Project Paper/Promotion of Business and Export Project (Amendment Number 1/Project Number: 521-0186), USAID, August 8,1986.

58. Ibid.

59. "Alpha Electronics sets new standards of excellence," Hispaniola Business, October 15, 1990.

60. "Country Report on Economic Policy and Trade Practices," Department of State, May 1989.

61. Haiti - Economic Policy & Trade Practices, eTP910200, U.S. Department of Commerce, International Trade Administration, 1991.

62. "Haiti Macroeconomic Assessment," Staff working Papers, USAID, February 1991.

63. Ibid.

64. Ibid.

65. "USAID/Haiti," Revised Stategy Paper for FY 1989/1990, USAID, November 1989.

66. "Haiti-An Overview," Bobbin, October 1984.

67. "Some Wealthy Haitians Are Facing Reversal of Fortune," The Journal of Commerce, June 25, 1992.

68. Labor Profile: Haiti, July 1982, Department of Labor, Bureau of International Labor Affairs.

69. Migration from Haiti and Export-led Development, by Dr. Josh DeWind, July 14, 1989.

70. "USAID/Haiti," Revised Strategy Paper for FY 1989/1990, USAID, November 1989.

71. Caribbean Basin Initiative: Impact on Selected Countries, Unted States General Accounting Office, July 1998.

72. Haiti - Commercial Activities Report '89, CAR8902, The American Embassy, U.S. Department of Commerce, February 1989.

73. "Haiti," Foreign Economic Trends and Their Implications for the United States, American Embassy Port-Au-Prince, U.S. Department of Commerce, International Trade Administration, April 6, 1992.

74. Worker Rights in Export Processing Zones, Bureau of International Labor Affairs, U.S. Department of Labor, August 1990.

75. Ibid.

76. "Haiti," Foreign Economic Trends and Their Implications for the United States, American Embassy Port-Au-Prince, U.S. Department of Commerce, International Trade Administration, April 6, 1992.

77. Labor Profile: Haiti, July 1982, Department of Labor, Bureau of International Labor Affairs.

78. Investment Climate Statement: Haiti: October 1984, from Investment Climate in Foreign Countries, Volume IV, Western Hemisphere (excluding Canada). U.S. Department of Commerce, International Trade Administration, August 1985.

79. Doing Business With Haiti, Libby Colen Roper, Overseas Business Reports, OBR 85-11, U.S. Department of Commerce, International Trade Administration, June 1985.

80. "Haiti," Project Paper/Promotion of Business and Export Project (Amendment Number 1/Project Number: 521:01860), USAID, June 29, 1991.

81. Doing Business With Haiti, Libby Colen Roper, Overseas Business Reports, OBR 85-11, U.S. Department of Commerce, International Trade Administration, June 1985.

82. Dominican Republic and Hait: Country Studies, Richard Haggarty, ed. Also see "Haiti," EIU Country Profile 1992-1993, The Economist Intelligence Unit.

83. "Haiti," Foreign Investment Trends and Their Implications for the United States, American Embassy Port-Au-Prince, U.S. Department of Commerce, International Trade Administration, April 6, 1992.

84. "Haiti," Project Paper/Promotion of Business and Export Project (Amendment Number 1/Project Number: 521:01860), USAID, June 29, 1991.

85. Ibid.

86. Ibid.

87. "Haiti," Caribbean UPDATE, September, 1991. Also see "Latin America's Exports of Manufactured Goods," Economic and Social Progress in Latin America, October, 1992.

88. "Latin America's Exports of Manufactured Goods," Economic and Social Progress in Latin America, October, 1992.

89. Ibid.

90. Labor Rights in Haiti, Lance Compa, International Labor Rights Education and Research Fund, 110 Maryland Avenue, N.E., Washington, DC, May 1989.

91. Haiti: Human Rights Held to Ransom, Amnesty International USA, 322 Eight Avenue, New York, NY 10001, August 1992.

92. SILENCING A PEOPLE: The Destruction of Civil Society in Haiti, Americas Watch - A Division of Human Rights Watch, National Coalition for Haitian Refugess, 438 Fifth Avenue, New YOrk, NY 10017-6104, February 1993.

93. "Keeping a careful eye on Haiti," Free Labour World, March 1993.

94. "Worry mounts for unionists beaten by police in Haiti," The Miami Herald, April 29, 1993.

95. Country Reports on Economic Policy and Trade Practice [Haiti], Department of State, February, 1990.

96. SILENCING A PEOPLE: The Destruction of Civil Society in Haiti, Americas Watch - A Division of Human Rights Watch, National Coalition for Haitian Refugess, 438 Fifth Avenue, New YOrk, NY 10017-6104, February 1993.

97. White House Briefing on Haiti to U.S. CEO's, The White House, Washinton, D.C., June 13, 1986.

98. Ibid.

99. "Apparel Dominates Caribbean Conference," Bobbin, February 1991.

100. TII Industries, Annual Report for period ending June 27, 1986.

101. "Caribbean Connection: complementary plants lower labor costs," Industry Week, March 9, 1987.

102. TII Industries, Annual Report for period ending June 24, 1988.

103. TII Industries, Form 10-K for period ending June 28, 1991.

104. "Caribbean Connection: complementary plants lower labor costs," Industry Week, March 9, 1987.

105. TII Industries, Annual Report for period ending June 27, 1986.

106. "Caribbean Offers a Golden Opportunity," Industry Week, March 9, 1987.

107. TII Industries, Form 10-K for period ending June 26, 1992.

108. "Caribbean Offers a Golden Opportunity," Industry Week, March 9, 1987.

109. "The pay is only $2.65 a day, a drawing card for hundreds of new factories," The New York Times, June 17, 1984.

110. Telephone interview by Mariana Mazzucato, April 30, 1992.

111. Ibid.

112. Kellwood, Merrill Lynch Presentation, April 7, 1992.

113. Labor Rights in Haiti, Lance Compa, International Labor Rights Education and Research Fund, 110 Maryland Avenue, N.E., Washinton, DC, May 1989.

114. "The pay is only $2.65 a day, a drawing card for hundreds of new factories," The New York Times, June 17, 1984. 

 

 


 

APPENDICES 


A. Open Letter to President Bush on Haiti, Washington Post, December 23, 1991

 

appendixa1

 

 

 appa2

 

appa3 

 

    appa4


B. U.S. Companies Importing From Haiti


appb1

 

appb2

appb3.1 

appb3.2 

appb4

C. Partial Listings of U.S. Manufacturing Companies Operating in Haiti and Exporting to the U.S. in 1988

appc1

appc2

 

 

appc3 

D. Partial List of Manufacturing Companies of Unknown Ownership Exporting to the U.S. from Haiti

 

appd1appd2

 

appd3 

 appd4

appd5 

 appd6

appd7 

E. Economic Data/Comparisons

appd8

 appd9

 

 appd10

 

appd11 

appd12 

  Appendix E. Partial Listing of USAID/Haiti Private Sector Projects

appe1

  appe2

  

Additional Sources on Haiti:

Congressional Presentation Fiscal Year 1992, Agency for International Development, 1992.

U.S. Overseas Loans and Grants; Latin America and Caribbean, Obligations and Loan Authorizations, FY 1946-FY 1991.

Country Reports on Economic Policy and Trade Practices [Haiti], Department of State, February 1989.

"Market Prospects: The Caribbean," Business Latin America, November 23, 1992.

"Haiti: Year After Coup, Export Industry Withered," Business Latin America, September 28, 1992.

"Business Suport Lays Sound Basis for Haiti's Future," Caribbean/Central American Action, Summer 1986.

Investment in Haiti, Ministry of Economy, Finance, and Industry; Investment Promition Division [Haiti], 1983.

The Electrotechnical Industry in Haiti, The Ministry of Economy, Finance, and Industry; Investment Promotion Division [Haiti], 1981 (Estimated).

"Haiti's textile industry continues to expand." Hispaniola Business, September 15, 1990.

"Haitian business leader forcasts textile expansion through marketing efforts," Hispaniola Business, September 15, 1990.

Limited Scope Grant Project Agreement Amendment No. 4 Between The Republic of Haiti and The United States of America for The Technical Consultants and Training Project, (AID Grant No. 521-0154), USAID, November 17, 1986.

Audited of USAID/Haiti Development Finance Corporation, (Project No. 521-0154, Audit Report no. 1-521-87-06), USAID, November 17, 1986.

Haiti - Foreign Economic Trends, FEFT9204, from report dated April 1992 prepared at the American Embassy - Port-au-Prince, U.S. Department of Commerce, International Trade Administration, November 28, 1992. 

 



ACKNOWLEDGEMENTS 


Research for this report was carried out by National Labor Committee staff Barbara Briggs, David Cook, Jack McKay and Charles Kernaghan.  We were also ably assisted by New School graduate student Marie Duggan.  Vicky Williams helped with the translation of documents.  Stella Grieco helped prepare the manuscript.

In Haiti, the delegation could not have met so many extraordinary people without the guidance of Kathie Klarreich.  And it was--of course-- the Haitian people who taught the delegation so much about the struggle for democracy and worker rights.

Besides union contributions, funding support from the Veatch and ARCA Foundations was instrumental in carrying out the trip, research and writing of this report.

Photographs by Ernesto Mora and Charles Kernaghan.
Cover design by Maggie Block; typesetting by Peter Hogness.
April 1993 

THE DELEGATION
Jack Sheinkman, President
Amalgamated Clothing and Textile Workers Union
M.E. Nichols, Executive Vice-President
Communications Workers of America
Edgar Romney, Executive Vice-President
International Ladies Garment Workers Union
Evelyn Temple, Assistant Executive Director
National Education Association
 
 
RESEARCH STAFF
Barbara Briggs, National Organizer
National Labor Committee
Muzaffar Chishti, Director
Immigration Project, International Ladies
Garment Workers Union
Charles Kernaghan, Executive Director
National Labor Committee
Joel Myron, Research Director
Brotherhood of Maintenance of Way Employees
 
 
 
In mid-March 1993, a National Labor Committee fact-finding mission visited Haiti to investigate labor rights conditions.  The delegation met with a broad range of organizations including labor unions; peasant organizations; religious, human rights and development groups; factory owners and industrialists; bankers; U.S. Embassy staff; OAS observers; members of the Aristide Government's Presidential Commission as well as members of preceding governments; and of course, with the people of Haiti.

Because of the marked increase in military repression as negotiations enter their final phase, we will not identify any of the people we interviewed by name, but rather, only by their organizational affiliation.  Similarly photos were chosen that do not show people's faces or faces have been covered so individuals cannot be identified. 

National Labor Committee Education Fund
 In Support of Worker and Human Rights in Central America

 
 
Co-Chairs
Owen Bieber, President
United Automobile, Aerospace & Agricultural Implement Workers of America International Union
George J. Kourpias, President
International Association of Machinists & Aerospace Workers
Jack Sheinkman, President
Amalgamated Clothing and Textile Workers Union 
  
 
Committee Members
David Arian, President
International Longshoremen's and Warehousemen's Union
Morton Bahr, President
Communications Workers of America
William H. Bywater, President
International Union of Electronic, Electrical, Technical, Salaried & Machine Workers
Cesar E. Chavez, President
United Farm Workers of America
Ron Carey, President
International Brotherhood of Teamsters
Charles B. Dale, President
The Newspaper Guild
Mac A. Fleming, President
Brotherhood of Maintenance of Way Employees
Keith Geiger, President
National Education Association
John H. Hovis, Jr., President
United Electrical, Radio and Machine Workers of America
Frank Hurt, President
Bakery, Confectionery and Tobacco Workers International Union
Frank D. Martino, President
International Chemical Workers Union
Jay Mazur, President
International Ladies Garment Workers Union
Gerald W. McEntee, President
American Federation of State, County and Municipal Employees
Henry Nicholas, President
National Hospital and Health Care Employees, District 1199C
James J. Norton, President
Graphic Communications International Union
Vincent Sombrotto, President
National Association of Letter Carriers
John N. Sturdivant, President
American Federation of Government Employees
John J. Sweeney, President
Service Employees International Union
Robert Wages, President,
Oil, Chemical and Atomic Workers International Union
William H. Wynn, President
United Food and Commercial Workers International Union

The National Labor Committee Education Fund in Support of Worker and Human Rights in Central America (NLC) represents 23 national unions.  The NLC was founded in 1980 to respond to the massive labor and human rights violations sweeping Central America.  Beginning in 1983, the Committee has led several delegations of union officials to the region on fact-finding missions, which have resulted in a half-dozen NLC reports documenting labor and human rights conditions.  On several occasions the Committee's interventions have helped gain the freedom of illegally detained unionists in Central America.  A 1992 National Labor Committee exposé, Paying to Lose Our Jobs, which documented the use of U.S. tax dollars to assist companies fleeing the United States, led to a major and ongoing reform of USAID as well as to a breakthrough amendment to the 1993 foreign appropriations bill conditioning all U.S. foreign aid on respect for internationally recognized worker rights.