tv Fault Lines Al Jazeera April 10, 2016 9:30pm-10:01pm EDT
>> "whose wal-mart is it? our wal-mart!" "who's number one?! the customer always!" when we operate for less and we buy for less, we can pass those savings on to our customers through everyday low prices. welcome huuuuugh jackman! >> total revenue i believe every year: 400 billion dollars. having low prices drives traffic to our stores, and increases sales >> please welcome john legend!
john legend: thank you! which then allows us to lower expenses, and lower prices again please welcome tom cruise! >> around the globe wal-mart is taking the lead in making a difference. >> it's a continuous loop. "the american dream has become a global concept. i think it's our country's best export >> usa! usa! usa! 2012 was a good year for walmart. but it was a bad year for bangladesh. >> it experienced the deadliest factory fire in its history. walmart shorts were among the clothes found in the charred remains. but the company escaped accountability and for many western retailers whose clothes are made in bangladesh, it's business as usual. fault lines travels there to
investigate why. >> anybody out there know how many zeros are in half a trillion dollars. take it from a numbers guy, they're a lot. >> the fire at the tazreen fashions factory last november started on the ground floor and quickly spread. at least 112 people died. hundreds of others were injured. many workers were trapped inside because the doors were locked, and the building had no fire exits. the remains of the fire are still everywhere. this is where workers jumped out the burning building onto the roof of this dormitory. there's bars on all windows so workers had to kick out at the exhaust fans and jump on the roof of this building.
>> so how did you escape? >> can you describe what you were working on? >> these were the pants you were working on. >> when word got out that we were visiting, other survivors came to share their stories. so you did the hemming along the zipper and the belt? and how about you? >> none of the women received compensation from walmart so you hanged and packed it up? - and they all vowed to never work at a garment factory again. >> do you know who these pair of shorts were for? >> walmart >> five months after the fire, yet another disaster in
bangladesh captured the world's attention. rana plaza, an 8-story building housing several garment factories collapsed. more than a thousand people died. even though the scale of the collapse eclipsed the fire, the fundamental questions raised by tazreen were the same. how could tragedies like this happen - and who, ultimately, should be held responsible? before we arrived in bangladesh, we'd received internal documents related to the walmart shorts order. the paper trail gives us an inside look into the complicated way that walmart produces its clothing. >> wal-mart is a pioneer and also the most ruthless practitioner of a sourcing model that has now come dominate the apparel industry. >> it's a system that can shield
the company from blame when disaster strikes. >> wal-mart's supply chain is defined by two critical features - the tremendous pressure wal-mart puts on its suppliers and its contract factories overseas to slash production costs which wal-mart knows those factories will do by ignoring the rights and safety of workers. and then secondly, the utilization of multiple layers of agents and contractors so that wal-mart can distance itself from responsibility of the inevitable consequences of those sourcing practices >> simco is a mid-sized garment factory in a neighborhood crowded with them. at its height, it had 15-hundred workers. today, there are 600. simco is where the shorts were supposed to have been made. wal-mart placed the order with a new york-based supplier called success apparel. success apparel then filled it with simco, with help from a local buying agent called true colors.
>> so this is from success apparel? >> yeah that's the contract and you can see, this is the price, and the quantity - 28,000 which is like 337,000 pieces. nowhere it is mentioned that this is a wal-mart product. but except if you see the label, style number, this is fg. fg is faded glory. >> faded glory is wal-mart's main, in-house clothing line. and it was that brand of shorts that was found in the ashes of the tazreen factory fire. simco says it couldn't handle the order after dozens of workers who left town during the muslim holiday of eid didn't return on time. >> so already we were overbooked, we were over our capacity and suddenly we don't have the workers to fulfill the orders on time. kevin taxin, the ceo of success apparels, he visited us and he was like going through our facilities, oh yeah the production, you know, use of
four letter words, etc. and then he was like, and we told him like, you know, we're having trouble meeting the deadline. we need some extensions. we need some help. >> he was very upset. he said not a single day extension they can give us. so he said find a subcontract, you know, somewhere. >> so the walmart supplier -the direct supplier to walmart -came here and told you to sub-contract? >> yes, yes. >> sub-contracting means paying another factory to take on some of the work. simco was already stretched thin dealing with the shorts. then, it was hit with yet another massive order. >> and then we've got this other document from public clothing company, and that's another wal-mart supplier? >> another wal-mart supplier. >> and they've sent a purchase order for almost 300,000 shorts. >> yes >> another set of shorts. >> august 17th >> august 17th, three days later >> yes.
>> simco can make around 300-thousand garments a month. put together, the two wal-mart orders were more than double its capacity. >> i guess the logic was you place the order and some other factory will fulfill it. >> somehow the factory will fulfill it? what's that code for? >> that's code for "yes, you do subcontracting." >> did wal-mart know your production capacity here? >> yes. wal-mart does third party audits. so the auditors come and they count your machines, so they know exactly how many garments you can produce on average on a line. >> given what happened in tazreen, some have asked why simco didn't simply refuse the second wal-mart order. >> factories in a place like bangladesh are engaged in cut-throat competition with competitors in bangladesh and around the world. so it's practically impossible to turn down a major order from walmart because that is the factory's livelihood.
>> so to meet walmart's deadline, simco subcontracted a small part of the success apparel order to a manufacturer called tuba. tuba then sent the shorts to its tazreen factory. a few weeks later, the factory caught fire. >> oh my god - couldn't believe. couldn't believe, you know. i couldn't believe - how can that happen? i don't know. so i called kevin, you know. i said look kevin the factory you know caught fire. he got mad, you know? he said what happened to the factory? so why didn't you send somebody to get our things out? >> success apparel accused simco of subcontracting the order without their knowledge. and wal-mart blamed their supplier: success. but simco insists that success knew about tazreen... and that wal-mart also would have known because its own database - retail link - requires suppliers to identify where orders are being filled
>> retail link is supposed to have a record of every factory authorized to produce more goods, every factory engaged in the production of wal-mart goods. >> in may, wal-mart named over 240 factories it would no longer work with, saying it had a zero tolerance policy for unauthorized subcontracting. simco was one of them. >> if there were no shorts found in tazreen then business would have gone on as usual. it's like everybody knows what's going on. it's an open secret. but getting caught on camera, or i think in the act, then you have to disown everything and say i didn't know anything about it. >> that it is the practice of wal-mart to hide, you know so no direct contact. so here's the supplier who's the vendor and every factory you see in bangladesh are subcontractors. everybody. >> facing a scandal, wal-mart
refused to accept the shorts or to pay the bill, even after some of the order had already been shipped. >> and this is our entirely abandoned floor. >> out 1 point 2 million dollars, simco says it's nearly bankrupt. >> so all of these shorts were made in these production lines, and i really feel bad when i don't see our workers in these production lines. some of whom have been with us for 24, 25 years and all these machines are now empty.
>> after the tazreen fire, walmart announced that it had dropped success apparel as a supplier. we tried to speak to success' representative in bangladesh, but we found the company had closed down its office here. we also tried to interview the company's ceo, gila goodman, in new york but she refused to
speak with us. kevin taxin was success' president at the time of the fire. he also refused to speak to us on camera. he now heads up another supplier called americo group. one of its clients...is walmart. >> if walmart were really so upset about what success apparel did, one assumes they would not be keen to continue to do business with a leading executive from success apparel. >> on the phone, kevin told us that neither success nor its agent in bangladesh, true colors, knew about the subcontract to tazreen. but we managed to track down true colors' last remaining employee in dhaka. >> if there's any subcontracting, would you be aware of that? >> yeah. >> and then what do you do with that information? do you pass it up? >> yeah. we pass it up to our importer. >> so can you read this email for me and tell me who it's from? >> ok, it's saying hi kanta, i heard the shocking news about
the fire last evening. it's nov 26. >> and what's the subject line of the email? >> fire at subcon. >> subcon is industry-speak for subcontractor. that email was sent by a manager at true colors shortly after the fire. so despite success' denials, their own agent may have been aware of the sub-contract to tazreen.
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human stories. >> if you have an agenda with people, you sometimes don't see the truth. >> "talk to al jazeera". monday, 6:00 eastern. only on al jazeera america. we are on the trail investigating how walmart's supply chain works here in bangladesh. does the company know when its orders are being subcontracted? is the way they source their clothing- the system itself -flawed? the garment industry is notoriously secretive, so we needed an insider. we're on our way to meet an auditor. he was hired by wal-mart to assess standards at some of its factories. it's very rare for auditors to speak on the record and he doesn't want to speak to us on camera. so we recorded the conversation secretly in bangladesh, government regulation of garment factories is lax, and international companies are not legally
required to ensure working conditions are safe. some companies hire auditors to inspect the factories. >> the purchasing system of walmart is very complex. >> how so? >> because they rely on their agents. they don't source directly from the factories. that is the problem, in my opinion. because if you rely on agents, that agent sends the order to sub-agent. that sub-agent sends the order to another agent so it changes 3, 4 times. >> what do you think about their system? >> bad. >> why do you think that's bad? what's wrong with using agents? >> using agents means you don't know your entire supply chain, from where your products are coming in. you don't have any idea. that's the danger. so you have very little idea after one or two agents, you are lost in the supply chain. >> from what you're saying it sounds like walmart's supply chain is so out of control that there could be more tazreens?
>> walmart has no idea from where their goods are coming from. this is the bad and worse sentence i can say. walmart has no idea where their goods are coming from. >> well, if walmart doesn't know where its goods are being produced, it's because they choose not to know. this is a company whose success is built first and foremost on an extraordinary level of control they exert over production in their global supply chain. >>walmart refused to give us any information about its supply chain. but a spokesperson told us walmart relies on its suppliers to implement the company's standards. there's a reason bangladesh is so popular with companies, especially those that produce inexpensive clothes that need to be made quickly. >> it's the rock-bottom, cheapest place in the world to make apparel. it's cheap because it has the lowest minimum wage for apparel workers in any country in the world at 18 cents
an hour >> that's about 38 dollars a month. but it goes both ways - garments are just as important to bangladesh, accounting for 80 percent of its exports and giving jobs to 4 million people, mostly poor women. that gives the industry enormous leverage inside the country >> so what they do - the retailers and buyers come here to look for the cheapest supplier. so here there is a buyer's market. everybody share -- everybody takes a share of the cake so formally we have 5 to 6 layers, but here are many hands with these layers who are taking all this money. >> it's not just the multi-nationals. in bangladesh everyone wants a shot at making
it in the ga rment industry. i'm headed to a small factory that does finishing of garments. they're supposed to be finishing garments for walmart. i'm posing as a buyer to get in there. for those who can't open large factories, there's always business in sub-contracting, even if it means putting the finishing touches on garments before they're shipped out. >> do you make anything that ends up in walmart? >> yes >> you've made products that go to walmart? >> were you an authorized walmart subcontractor? >> so is this very common? that a lot of factories subcontract for big labels like walmart without authorization?
>> sabina? you're 14? so you started working when you were 13 years old? >> so what's the average age of your workers? >> but we just spoke to a girl who said she's 14. >> walmart told us they don't tolerate child labor in their supply chain - and they're investigating whether this finishing center did any work on walmart products. once we found one finishing house, it wasn't hard to find others. >> what are you making? >> how many buttons do you put on everyday? >> how old are you?
>> how long have you been working here? >> shewli, how old are you? >> shewli, do you go to school? >> how much money do you make here, shewli? >> 2,500 take is just 32 dollars a month. >> shewli, you're putting the elastic band into old navy pants? >> it says "old navy" >> old navy >> old navy is owned by gap inc, one of the largest clothing companies in the world. this is where a lot of america's clothes come from - and it's a reality many companies don't want us to see. this is one of very many subcontracting factories at the
bottom of the supply chain in bangladesh. it seems completely unregulated, completely unauthorized. // there's no fire extinguisher, no fire exit. it's just a shack in someone's backyard. >> this morning we went to a finishing house and they had about 20 workers there. more than half of them were under 14.there were girls as young as twelve making clothes for gap. >> really? in a finishing section that you went? oh, my gosh. oh, my gosh. i mean for me, i just can't believe. so this is the time that gap should step forward to make this correct. oh, my gosh. so see how critical is the supply chain is. how critical it is. >> gap declined to give us an
on-camera interview. they did give us a statement, though, saying the products we found were quote "either counterfeit or improperly acquired." but through the barcodes on the tags we found at the finishing house as well as shipping records, we were able to match the garments to ones at old navy stores in the u.s. gap added that it "strictly prohibits any vendor from employing underage workers" >> there is a fairy tale that major brands and retailers like gap and walmart tell to public. in this fairy tale gap and walmart are companies that are socially responsible and deeply committed to protecting the rights of workers and making every effort to inspect their factories and ensure that everything is on the up and up. that fairy tale has very little to do with the reality of the supply chain. for walmart, for gap, worker rights issues are not a moral issue. they're an issue of reputational risk and walmart
and gap understand that their image in the eyes of the public has a very large impact on the degree to which they can get people to come to their stores and buy their goods. and so to the extent that they can be convinced that their image will be damaged if they don't do the right thing for workers, than they will make change. >> months after the tazreen fire, the memories of that disaster - and the ones that followed - are still fresh in people's minds. kalpona akter, a worker's rights activist, rushed to the scene not long after the fire began. >> it was horrific. for my experience, i think, i was crying and still you could feel the heat inside and my skin was burning. it took walmart two days to acknowledge its connection to tazreen... after photographs emerged showing its labels in the wreckage. the walmart clothes wasn't
burned to ash, some others maybe, but not them. >> kalpona, like the women who survived the fire, is still haunted by what she saw that day. it's a feeling that when you are on the inside of the building you can feel that how these workers fought to remove these window bars. my feeling was like nothing could be worse than this, nothing can be worse than this. like seeing these people burnt to ash and their family crying in front of you and they cannot find, identify their bodies, whether it's their beloved or not. nobody thinks about these human faces who are making clothes for them and dying in these factories every day. nobody is talking about their compensation, nobody talking about their wages that they are getting. even they don't even consider that they're human. they have names, they have a
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