Considering collapse

WASHINGTON—Democratic Sen. Bob Menendez on Thursday called April's building collapse in Bangladesh “a wake-up call” and urged the Obama administration to consider suspending Bangladeshi trade privileges.

Menendez made the comments at a hearing in the Senate Foreign Relations Committee, which was the panel’s first labor hearing since 2000. Lawmakers heard testimony from five witnesses, including representatives from the Department of State, Department of Labor, the Office of the U.S. Trade Representative, organized labor, and a coalition of North American retailers.

On April 24, an eight-story building housing five garment factories collapsed in Savar, Bangladesh, killing 1,127 workers at Rana Plaza.

“When do we go from saber-rattling to some action?” Menendez asked the first panel of witnesses. “We have seen some movement in laws that have been proposed and/or passed, but we’ve seen very little enforcement at the end of the day. How many more people have to die?”

While lawmakers and witnesses all agreed that changes were needed, they sometimes disagreed on the best course of action to achieve it. Menendez led calls for limiting or suspending Bangladesh’s Generalized System of Preferences (GSP), an American program that helps developing countries by allowing them to export certain products to the U.S. tariff-free.

Menendez said action is necessary to send a message that Bangladesh’s long-standing labor problems must be addressed.

“What happens in Bangladesh will have a dramatic ripple effect on the global apparel industry,” Menendez said. “A change in working conditions there has the potential to change conditions for workers everywhere.”

Sen. John McCain, R-Ariz., said suspending GSP benefits would “ratchet up unemployment” in the impoverished country, so it should be used only as a last resort. But ultimately it’s out of congressional hands: The decision to withdraw GSP privileges rests with the White House.

GSP benefits only apply to about 1 percent of Bangladesh’s exports to the U.S., but Celeste Drake, an AFL-CIO labor representative, told lawmakers it would spark action from the country’s government officials and “do much more good than harm.”

Thursday’s hearing came on the heels of news out of Bangladesh that its finance minister allotted no new money in the 2013-14 budget for factory safety improvements. Still, finance ministry Abul Maal Abdul Muhith pledged to improve worker safety in the garment and other industries.

“For the workers of Bangladesh, receiving assurances from the government isn’t very reassuring,” Drake said.

Last year a factory fire killed 112, prompting calls for strengthened safety in the garment industry. But global retailers defeated attempts to enact new safety requirements earlier this year.

In less than six months between the two major incidents, 41 factory fires killed nine and injured more than 700 in “minor” accidents.

More than 40 global brands, mostly European, have signed a Bangladesh fire and safety initiative, but most major U.S. retailers have declined, including Walmart, Macy’s, Target, JC Penny, The Gap, and other companies.

Instead, a group of major North American retailers is working on its own proposal, which it says would take into account the different laws facing American companies. The alliance of retailers has recruited former U.S. Sens. George Mitchell, D-Maine, and Olympia Snowe, R-Maine, to facilitate the discussions.

Johan Lubbe, a lawyer who addressed lawmakers on behalf of the coalition, said North American companies are prepared to play a “meaningful role” in reform.

Annual trade between the U.S. and Bangladesh tops $6 billion and supports more than 10,000 American jobs.

Robert Blake, assistant secretary of state for south and central asian affairs, told lawmakers progress is being made but still has a long way to go. He said 27 labor unions have been formed since last year—a major achievement in a country where labor leader Aminul Islam was murdered in April 2012. His slaying remains unsolved.

“Bangladesh is now at a critical moment in its history,” Blake said.

Blake cited three major priorities for achieving better working conditions: Granting workers the right to organize, guaranteeing fire safety, and guaranteeing building stability.

A recent survey of engineers in Bangladesh revealed 60 percent of inspected factories are susceptible to collapse.