Our guest blogger is Sabina Dewan, Associate Director for International Economic Policy at the Center for American Progress Action Fund.

In an Op-Ed in the New York Times yesterday, Nicholas Kristof condoned labor exploitation in the form of sweatshops as a route out of poverty:

Mr. Obama and the Democrats who favor labor standards in trade agreements mean well, for they intend to fight back at oppressive sweatshops abroad. But while it shocks Americans to hear it, the central challenge in the poorest countries is not that sweatshops exploit too many people, but that they don’t exploit enough. Talk to these families in the dump, and a job in a sweatshop is a cherished dream, an escalator out of poverty.

The notion that taking advantage of a person’s desperation for economic gain is somehow morally defensible is preposterous. There is no doubt that much remains to be done to alleviate global poverty, but in case Kristof is not aware, there are many alternative strategies that can help with this cause. The International Labor Organization’s Decent Work Agenda — which focuses on the creation of decent employment, alongside social dialogue, social protection and fundamental principles and rights at work — is but one example.

The observation that those working in factories are “better-off” as compared to those in the informal sector, undertaking menial jobs simply to survive, is well taken. But, those favoring labor standards in trade agreements reflect a much more nuanced understanding of the real problem than Kristof does.

First, they do not mistake the call for improved labor standards to be a poverty reduction strategy. Second, they understand that the higher production costs associated with better labor standards can be offset by the concomitant rises in productivity and economic performance. As the ILO noted:

Higher wage and working time standards and respect for equality can translate into better and more satisfied workers and lower turnover of staff…Safety standards can reduce costly accidents and health care fees….Freedom of association and collective bargaining can lead to better labour-management consultation and cooperation, thereby reducing the number of costly labour conflicts and enhancing social stability.

Better labor standards also help level the playing field for producers internationally, and they increase the size of potential export markets for the U.S. Finally, the inclusion of labor standards in trade agreements must be supported by additional progressive institutions such as universal education, healthcare and other social safety nets to ensure better distribution of the gains from trade.

So I would like say to 13 year old Neuo Chanthou — whose heartbreaking story Kristof used to argue his point — that rather than aspiring to work in a sweatshop, she should be in school, and when she gets home, her healthy mother and father will be able to provide for her and her disabled sister from their ‘living wage’ earned at a ‘decent job’.

Today, Reuters highlighted some sobering government poverty data that shows the extreme reach of the current economic downturn:

About 37.3 million Americans were living in poverty in 2007, or about 12.5 percent of the population, according to the government…Figures due out in August will show that rose by about half a percentage point last year, analysts estimate, and more and more [middle class people] will slip into poverty this year as the recession takes hold.

Currently, unemployment is at 7.2 percent, and reaches 13.5 percent when the underemployed (those who want to work full time, but can only find part time jobs) are factored in. Some economists estimate that unemployment will hit 10 percent by the end of this year. If that occurs, “7.5 to 10.3 million more people could fall below the federal poverty line,” which is an annual income of $21,203 or less for a family of four.

This is why measures aimed at alleviating the sting of unemployment and poverty need to be included in the economic stimulus package being crafted in Congress. As Nobel Prize-winning economist Joseph Stiglitz explained, this type of stimulus spending “serves multiple ends“:

Increased unemployment benefits have the largest multiplier effects – cash-strapped families spend every cent given – and meet vital social needs. It is imperative to provide health insurance to the unemployed: without that, a single serious incident can push a family into bankruptcy. Helping the unemployed meet house payments reduces foreclosures, addressing one of the underlying causes of the crisis.

As the Center on Budget and Policy Priorities laid out, these measures also “have a further indirect effect on job creation that unfolds over time, as workers and firms who benefit spend their increased income on a broad variety of goods and services throughout the economy, which in turn preserves or creates jobs and leads to additional spending.”

The proposed stimulus circulating on Capitol Hill includes $43 billion to extend unemployment benefits through 2009, $39 billion to help those who lose their jobs pay the cost of keeping their employer-provided health care, a 13 percent increase in food stamps, and $200 million for local emergency food and shelter programs. This is an excellent start, but addressing poverty can’t stop when the stimulus is gone.

The Center for American Progress has calculated that a $90 billion yearly investment would cut poverty in half, and that the money could be raised primarily “by bringing better balance to the federal tax system and recouping part of what has been lost by the excessive tax cuts of recent years.”

This investment would move to end the “lost potential of children raised in poor households, the lower productivity and earnings of poor adults, the poor health, increased crime, and broken neighborhoods [that] all hurt our nation,” thus making the overall economy more productive.

Out guest blogger is Center for American Progress senior fellow Van Jones, CEO of Green For All, who testified yesterday before the first hearing of the House Select Committee on Energy Independence and Global Warming. This is his testimony.

Mr. Chairman, other committee members, I’m just happy to be here and I appreciate the opportunity to talk. I was here in 2007 when the term “green collar job” was very rarely heard anywhere. This may have been the first place it was heard in Congress.

And now it is everywhere, and that reflects something. It reflects a hunger and desire on the part of the American people to solve the two biggest crises possibly ever to face this country: an economic catastrophe and a climate crisis, both of which could undermine our nation’s security, our economy, not just now but for decades into the future.

You, unlike the rest of us — next week, we’re going to be celebrating — you’ll celebrate for about ten minutes and then you’re going to go back to sweating. Sweating over the details of this recovery, sweating over the details of how it is that we can actually beat the recession and global warming at the same time.

The 111th Congress will be in the history books. A hundred years from now, students will study this Congress, and they will ask one question: “Were you able to solve the problem? Were you able to able to deal with this twin crisis? How did you do it?”

And you’re going to get a grade from our great-grandchildren: Yes or no. Pass or fail.

The reason that green jobs are so important is because they are the most secure way to ensure success for this Congress. And the whole country now is looking for a change. You have the opportunity now to turn this breakdown into a breakthrough. And you can if you honor three principles. Read more