In a recent investigation conducted by the Italian Competition Authority (AGCM) in Italy, two of the best-known global luxury brands, Armani and Dior, have come under scrutiny for alleged labor exploitation abuses [1] [2].
The investigations revealed that “the companies would use supplies from workshops employing workers who would receive inadequate wages. They would also operate at working hours beyond legal limits and under insufficient health and safety conditions.” [3]
Such exploitation is not an anomaly, but a structural feature of a system that maximizes private profit and reproduces capital at the expense of the welfare and safety of the workers who produce the very wealth that corporate owners appropriate.
Starvation wages and degrading working conditions used to reduce production costs and increase profit margins are common practices in capitalism. Although there is a tendency among capitalists to push wages down to subsistence levels or below, such a degree of exploitation is not sustainable for the system as a whole. This is because wages that are too low threaten both the reproduction of the labor force and therefore, the growth of capital. Also when workers' wages fall below a certain minimum level, it decreases their purchasing power, undermining the ability of sellers to sell the goods they produce (especially companies like Armani and Dior), which in turn leads to serious crises of overproduction.
The state then intervenes by enforcing a minimum wage not to protect workers out of the kindness of their hearts, but to safeguard the interest of the ruling class and ensure the stability of the economic system. Through laws that regulate exploitation, such as the minimum wage, the state seeks to prevent a level of exploitation that could destabilize the system as a whole. In this way, the role of the state is not to eliminate exploitation, but to keep it within “manageable” limits for the capitalist system, attempting to prevent it from becoming a problem that could jeopardize the entire economic order.
However, retail companies, but also supplier groups, to compensate for losses or to increase profits, reduce wages, increase working hours or lay off workers en masse, leaving many families below the poverty line. This economic insecurity often leads the children of these families to drop out of school, seeking alternative earning options that often result in crime or drug trafficking. The desperation caused by the impoverishment of workers creates the conditions for the most predatory and unprincipled capitalists to exploit the most destitute workers at unsustainable levels; well below what is required for the reproduction of labor-power.
As a result, it’s not enough for these companies to simply cut ties with indicted suppliers or strengthen supplier controls. The problem is systemic and requires a radical change in the way the production and distribution of wealth are organized. As long as the system is based on the accumulation of capital through the exploitation of workers, these cases will continue to emerge. Measures such as cutting ties with suppliers deemed unethical or imposing fines do not solve the problem.
The only solution is a radical change of the entire social base, which determines the production and distribution of wealth. This means overcoming the capitalist system and establishing a new social organization in which the means of production are collectively owned and managed under a scientific plan – a socialist system. This radical change cannot be achieved without a well-organized and determined political force.
A genuine communist party is the only force that can lead this process. Such a party must be consolidated on a solid foundation of discipline, theory and democratic centralism, ensuring that every member is well-prepared and committed to the cause. We are involved in this work, join us.