Chapter 1

 

Just Don't Buy It
Challenging Nike and the Rules of the Global Economy

  When Jeff Ballinger was in Indonesia to monitor wages and working conditions from 1988 to 1992, he played on a softball team with employees of the Beaverton, Oregon-based Nike corporation. Nike had contracted with Korean and Taiwanese factory owners to operate production facilities for Nike shoes in Indonesia. Ballinger was not very familiar with the emerging structure of labor practices in the developing world and assumed that his teammates were directly managing Nike-owned factories in the country. The players were talking one day and Ballinger mentioned that he was in Indonesia to help protect the rights of workers producing goods for American corporations. One of the Nike employees laughed and told Ballinger, "I am your worst nightmare." The exchange was part of ongoing banter, and Ballinger did not ask the Nike employee what he meant by his comment.

Soon after this conversation Ballinger was monitoring wage data on Indonesia's sneaker industry. He discovered that Nike's Indonesian workers were being paid only fourteen cents per hour. Ballinger began to investigate the wages and working conditions of the mostly female Indonesian workers making Nike shoes. He learned that Nike's subcontractors were not even paying the below-subsistence wage required by Indonesian law. Ballinger also found abusive and often physically coercive working conditions. Based on his observations Ballinger examined the factors that appeared to lead Nike to shift its production facilities to Indonesia. He found that Nike had closed its last U.S. plants in Saco, Maine, in the 1980s, and during the 1970s had shifted most of its shoe production to South Korea, whose workers earned nowhere near the U.S. rubber-shoe industry average of $6 per hour. When South Korea's prodemocracy movement of the late 1980s gave workers the right to form independent unions and strike, Nike's work force won higher pay. The new salaries remained far below American standards, but Nike wanted a better deal. Indonesia, with its cheap labor costs and dictatorship whose military ensured labor peace, seemed the perfect choice.

As a result of his findings Ballinger wrote an article for the August 1992 Harper's, "Nike, the New Free-Trade Heel: Nike's Profits Jump on the Backs of Asian Workers." The piece consisted of Ballinger's commentary on a copy of a pay stub of an Indonesian worker named Sadisah. The stub indicated that the employer was not Nike but Sung Hwa Corp., a Korean-based company now serving as Nike's subcontractor in Indonesia. Nike was the first athletic footwear operation to fully subcontract its production facilities. Because the workers were not employed by Nike, the corporation could avoid legal responsibility for their wages and working conditions.

Ballinger described how Nike's shifting of factories to increasingly cheaper labor pools had meant solid growth for the company. In 1991 Nike had its best year yet, with a record net profit of $287 million. As Sadisah's April 1992 wage stub showed, however, those making Nike's shoes had not reaped the benefits of the company's success. Sadisah was earning only fourteen cents per hour, less than the Indonesian government's standard for "minimum physical need." The International Labor Organization found that 88 percent of Indonesian women working at such wages were malnourished. Sadisah's wages allowed her to rent only a shack without electricity or running water.

Her wage stub showed Sadisah to be a very hard worker. She had worked sixty-three hours of overtime during the pay period and received an additional two cents per hour. She assembled 13 pairs of Nike shoes every day; the labor cost for a pair of Nike shoes selling for eighty dollars in the United States was about twelve cents. Ballinger concluded by observing that in order for Sadisah to earn as much as the $20 million annual endorsement fee paid by Nike to basketball superstar Michael Jordan, she would have to continue working six days a week, ten and a half hours per day, for 44,492 years.

Ballinger's description of Nike's labor practices was graphic and compelling. His Harper's article is the type of original historical document that should be included in the Smithsonian Institution, where many of America's archival materials reside. Like other social change visionaries, however, Ballinger had produced a critique of Nike and of global free trade that was ahead of its time. Nike had already achieved a nearly mythic status in America, and its advertising had connected its brand name to too many positive images for a critical two-page article by an unknown human rights activist, even published in an elite liberal magazine, to be noticed. Like activists who opposed the Vietnam war before 1965 and those attacked as "premature anti-Fascists" for going to Spain to save the republic from Franco and Hitler in 1936, Ballinger's viewpoint lacked sufficient public support to be espoused or endorsed by the mainstream media. Thus his groundbreaking analysis of Nike was not soon followed by broader media coverage of the company's Indonesian labor practices; Ballinger may have been alone in foreseeing that his article would lay the groundwork for a national campaign challenging Nike's labor practices and the prevailing rules for corporate responsibility in the global economy.

Ballinger's critique of Nike's labor practices emerged during a decade in which the leadership of both of America's national political parties strongly embraced unfettered free trade and escalating economic globalization. At an eight-nation economic summit meeting in June 1997 President Clinton declared globalization to be "irreversible" and thought it "difficult to imagine that this is even a serious debate right now." Clinton's view was promptly echoed by his purported chief ideological adversary, Republican House majority leader Dick Armey, who urged recognition of unrestricted free trade as a "basic human right." Armey also asserted that free trade was "liberating" for Chinese workers forced to work as either slaves or for meager wages making goods for American import. This bipartisan support led many to conclude that the national political arena was not a hospitable venue for activists seeking to rewrite the allegedly "ironclad" rules of free trade and the global economy.

Jeff Ballinger, however, believed that a successful challenge to the global labor practices of one of the world's most successful and popular corporations could establish a precedent for similar national grassroots campaigns. As impossible as a national campaign against Nike appeared at the time, the ensuing years brought results that have revised and may ultimately rewrite the rules for the global economy and change the substantive meaning of free trade. The anti-Nike campaign's success against overwhelming odds shows the continued power of national activism to reclaim America's progressive ideals.

 

Activists versus Nike:
The Obstacles to Success

Jeff Ballinger's goal of inspiring Americans to force Nike to reform its global economic practices faced at least five formidable obstacles. These included Nike's positive corporate image; the difficulty of interesting Americans in Indonesian affairs; Nike's contracts with major college and university athletic teams; its adoption of a Code of Conduct that conveyed the message, albeit erroneous, that it carefully monitored its subcontractors' wages and working conditions; and the public perception that it was unfair to target Nike when other footwear companies allegedly engaged in similar practices. The impediments were so great that embarking on an anti-Nike campaign in 1992 seemed to violate the standard organizing rule of picking only potentially winnable fights; the growth of the anti-Nike campaign in the face of such obstacles demonstrates not only the power of activists acting nationally to rewrite the rules of the global economy, but the triumph of the activists' vision of what is possible over prevailing mainstream assumptions that have too often deterred social change efforts in all fields.

 

Nike's Image: Just Do It

Ballinger's exposé appeared during a period of dramatic growth for Nike. Nike's profits tripled from 1988 to 1993, and unlike Microsoft or other hugely successful corporations of the 1990s Nike was identified with hipness and style as well as dependability. The popular image of the Nike sneaker as a vehicle for personal transformation was imprinted on the public's consciousness through advertising campaigns whose budgets rose from $250 million in 1993 to $975 million worldwide in 1997. Nike's television advertisements have consistently proven as persuasive and evocative as any of their surrounding programming. In the 1980s Nike's ads featured a series of vignettes between basketball superstar Michael Jordan and film director Spike Lee; the idea was spawned when a member of Nike's ad agency saw that Lee's Mars Blackmon character in his film She's Gotta Have It refused to take off his red and black Nike Air Jordans even while making love. Nike's "Bo Knows . . . " ads featured multisport superstar Bo Jackson to emphasize the sneaker's versatility. In the most famous of the "Bo knows" series, Nike displayed its clout and hipness at once by including in one commercial tennis star John McEnroe, hockey star Wayne Gretzky, Jordan, and a renowned blues original whose identity was revealed by his tag line: "Bo, you don't know Diddley."

Nike's reliance on African-American sports stars in its commercials was a dramatic break from the past. Before Nike's advertising campaign, even the greatest African-American superstars such as Hank Aaron, Willie Mays, Bill Russell, and Jim Brown failed to receive the national endorsements of their less successful but Caucasian peers. Nike's willingness to break the marketing stereotypes that had denied endorsements to African Americans both helped sell Nike shoes in inner cities and contributed to the company's progressive image.

Also contributing to Nike's progressive identity was its choice of subjects for its "Just Do It" campaigns. For example, in 1988 Nike's "Just Do It" ads featured a wheelchair racer competing at racquetball and basketball, a forty-two-year-old female New York City Marathon champ, and an eighty-year-old who ran seventeen miles through the streets of San Francisco each day. The ads conveyed the idea that Nike sneakers were worn by people of all ages, genders, and disabilities, and that the buyers of Nike shoes had the grit and determination to take on the type of challenges included in the advertisements. A widely distributed Nike poster reflected the company's apparent recognition of the country's social, economic, and racial injustices. The text, "There are clubs you can't belong to. Neighborhoods you can't live in. Schools you can't get into," appeared above a photo of a lone runner on a country road. The text then concluded, "But the roads are always open. Just Do It." Wearing Nikes offered a route to spiritual if not political salvation in an unjust world.

By 1992 Nike's advertising strategies had convinced millions of Americans that paying up to $150 for a pair of sneakers costing $5 to make was a small price for certified acceptance into the world of the socially hip and adept. Nike even defined such a purchase as a revolutionary act, using the Beatles' song "Revolution" to pound this point home in a 1980s advertising campaign. Wearing Nike shoes brought status and security to young people, while trying other brands risked peer group criticism. The Nike swoosh had become a seal of approval; if it was good enough for Michael Jordan to wear, no kid could challenge its preeminence.

As a result of its creative advertising campaigns, in 1993 Nike was one of the first three companies to be inducted into the American Marketing Association Hall of Fame (the others were Coca Cola and Absolut Vodka). This honor was bestowed only upon brands that "represent innovative and trailblazing marketing and have had a dramatic impact on our lifestyle, becoming enshrined as American icons." In light of the icon status of Nike sneakers and of the company's progressive and racially groundbreaking image, is it any wonder that Ballinger's Harper's article was widely ignored? The larger question seemed to be how Ballinger and other activists could successfully challenge the labor practices of a company that had achieved a cultural status that seemingly rendered it impervious to activists' campaigns.

 

Indonesia: The Lost World

The second obstacle to the growth of a national anti-Nike campaign was that Nike's wrongdoing through 1992 was occurring in distant and little-known Indonesia. By moving its production facilities to Indonesia, Nike had chosen one of the most brutal regimes of modern times as its guarantor of labor peace. Indonesia must have seemed the country least likely to permit worker unrest over wages and working conditions. Traditional assumptions about American attitudes toward social and economic injustice in other nations also made Indonesia a seemingly safe harbor for Nike's production facilities. The fourth most populous country in the world, Indonesia is a nation of thirteen thousand islands and several hundred ethnic groups located south of Malaysia and northeast of Australia. Relatively few Americans have visited Indonesia, there is no sizable or politically potent Indonesian immigrant community in the United States, and therefore Americans do not have strong religious, ethnic, or racial ties with Indonesia like those that have mobilized them to focus attention on other foreign countries. Indonesia's longtime dictator, President Suharto, was barely known in America in 1992, and as a strong ally of the United States, Suharto did not engage in the confrontational posturing that raised public awareness of Libya or other distant lands. Although Indonesia aroused controversy among human rights groups for its 1975 invasion of neighboring East Timor and its subsequent murder of more than a quarter million East Timorese, this genocide brought little American media attention, and Suharto retained bipartisan political support. The dictator had provided a safe and stable profit-making environment for multinational corporations since coming to power in a CIA-backed coup in 1965; if the American public and media had not been aroused by Suharto's genocide and reign of terror, there was no reason to expect them to be outraged by stories of poor wages and working conditions of Indonesian workers making Nike shoes.

 

The University of Nike

A third obstacle to a national anti-Nike campaign was the company's nearly total control of the sneakers worn by the country's top college basketball teams. Having conducted a survey that found strong links between the shoes preferred by local college sports teams and the sneaker preferences of the kids in the stands, Nike began seizing control of the college basketball team market as early as 1978. The company accomplished this by paying six-figure annual salaries to coaches of elite basketball programs such as Jerry Tarkanian of University of Nevada at Las Vegas, John Thompson of Georgetown University (who subsequently joined Nike's board), and Dean Smith of the perennial powerhouse University of North Carolina. Duke's coach, Mike Krzyzewski, was given a million-dollar signing bonus in addition to his annual Nike compensation. In exchange for such lavish deals, these coaches gave a few clinics and, far more important, they outfitted their teams with Nike sneakers. In 1985 Nike had all of the Final Four basketball teams under contract and twenty-three of the sixty-four teams in the tournament. The rules governing intercollegiate sports stated that no player could be forced to wear an endorsement shoe, but rejecting a shoe endorsed by the coach who awarded the player's athletic scholarship and determined his or her playing time was unlikely. Such rejection could even be construed as criticism of the coach's ethics. When Jim Calhoun, the University of Connecticut's basketball coach, was asked about Nike's abuse of Indonesian workers and his fifteen-year "relationship" with the company, he replied, "I don't think that it's something that, when we get the various sneakers that we think of who made them. Maybe that's ignorance on our part, but it's a very honest ignorance." Nike's role as supplier and underwriter of male and female college athletic programs would grow throughout the 1990s. By 1992 Nike sneakers were already linked with college basketball success. Convincing kids in the stands that they should wear a different and, by implication, inferior product seemed an insurmountable task.

 

Nike's Code of Conduct

The fourth obstacle to the growth of an anti-Nike campaign was the company's formal adoption of policies that conveyed the message that Nike zealously protected the interests of those workers making its shoes. Nike adopted its Memorandum of Understanding and Code of Conduct for its Indonesian "business partners" following Ballinger's article in 1992. Nike's Memorandum required its subcontractors to comply with local laws regulating wages and working conditions and mandated that documentation of compliance with the Memorandum be maintained for Nike's inspection. The Memorandum also required subcontractors to adhere to environmentally safe practices and to certify that they did not discriminate on the basis of gender, race, religion, age, ethnic origin, or sexual orientation. Incorporated into the Memorandum was the Nike Code of Conduct. The Code stated that Nike seeks "always to be a leader in our quest to enhance people's lives," which means that at every opportunity, including in the areas of human rights and equal opportunity, "we seek to do not only what is required, but, whenever possible, what is expected of a leader."

It would be nice to think that a journalist reading of Nike's extraordinary commitment to human rights, worker rights, and an equal opportunity provision so progressive that it specifically protected Indonesian gays and lesbians from discrimination in the workplace would investigate whether such rules were actually being implemented under the Suharto dictatorship. But the American media in 1992 was uninterested in putting resources toward verifying whether Nike's subcontractors adhered to the Memorandum or Code; the very existence of such formalized policies enabled Nike to deter media inquiries and to readily defend itself against charges of labor mistreatment. The anti-Nike campaign would have to develop its own credible information sources establishing Nike's failure to monitor compliance with its Code in order to overcome Nike's repeated refrain that it was a leader in protecting workers' rights in the global economy.

 

Why Single Out Nike?

Finally, an anti-Nike campaign had to overcome the notion that it is unfair to attack Nike for labor practices endemic in the developing world. Jeff Ballinger's strategy was to focus on a particular company and its abuses to demonstrate the need for broader reform. However, if Americans felt that Nike could not compete in the global economy without relying on workers earning below-subsistence wages, they might feel that Nike could not be blamed for the workers' plight or be held responsible for initiating reforms. Further, if the entire system of corporate exploitation of workers in the global economy was the problem, it could be argued that focusing on any one company was pointless. As frustrating and irrational as it is, the stance that "all corporations are evil so there's nothing to be done" has been a remarkably effective rationalization for inaction in the face of injustice. For an anti-Nike campaign to develop, activists had to demonstrate that Nike was not merely a symptom but a leader and perpetrator of global economic injustice and that it could readily institute reforms without sacrificing market share or plunging into insolvency. Activists' challenge to Nike's labor practices and global economic impact therefore had to surmount obstacles beyond those typically associated with national corporate campaigns. Unlike such past targets as the J. P. Stevens company, corporations doing business in apartheid South Africa, and the agribusiness interests that fought Cesar Chavez's creation of the United Farm Workers, Nike was a powerful adversary that also had a positive public image. Nike's founder and CEO, Phillip Knight, has often described Nike as a marketing rather than footwear enterprise, and Nike had a massive advertising budget to counter whatever negative publicity activists could generate about its labor practices. Nike's control of the college sports team market ensured that the brand would remain identified with athletic success, and there was no reason to believe that Americans would suddenly become interested in addressing Nike's labor abuses in a nation few could even locate on a map. Despite these obstacles, Ballinger's fundamental strategic analysis was correct: a successful anti-Nike campaign that forced the company to ensure a living wage for those producing its goods would set a precedent for other American companies seeking to take advantage of free trade by operating in nations that sanction exploitative wages and working conditions. If activists were to overcome the inauguration crowd's allegedly ironclad rules for the global economy, Nike, the model for these rules, had to be fought regardless of the barriers.

 

1993-1995: The Campaign Slowly Begins

Soon after his Harper's story appeared, Ballinger left Indonesia for Istanbul, Turkey. He continued to monitor Nike's Indonesian labor practices and every two months sent packages of information on Nike to thirty media outlets worldwide. In the year following his exposé of Nike's labor abuses, however, there was little evidence that Ballinger's charges had made any impact. Although the basic themes of the national anti-Nike campaign emerged in 1992, it would take more than three years for activists' critique of Nike's labor practices to reach the American public's consciousness. The pace of national social change struggles often is slower than activists would like and frustration can build as years pass without any guarantee that small victories and flurries of momentum will ever become a larger, more coherent movement. It is helpful to recall that nine years passed between the Rosa Parks-triggered Montgomery bus boycott and the passage of the first meaningful federal civil rights legislation in 1964. The escalation of the Vietnam war in 1965 brought few public or campus protests; the largest such events did not occur until 1969 and 1970. The year following Ballinger's exposé was thus not atypical of a nascent movement's formative years. In 1993 Nike posted a record profit of $298 million and its U.S. gross revenue reached nearly $2 billion. Nike's most prominent advertising spokesperson, basketball star Michael Jordan, was paid $20 million to tout the company's sneakers; this amount was four times the total earnings of the twelve thousand Indonesian women who made Nike's shoes. While the U.S. State Department worldwide report on human rights for 1993 acknowledged that Indonesia's government sanctioned attacks on workers' rights, the document did not connect Nike to any abuses.

Nineteen ninety-three did bring a breakthrough in public understanding of the full meaning of free trade. In a bitter campaign that continued for much of the year, President Clinton and his corporate allies ultimately won passage of the North American Free Trade Agreement (NAFTA). NAFTA's enactment was justifiably seen as a defeat for labor and human rights groups, which had argued that "free trade" would restrict America from preventing the import of goods made under labor, environmental, and social conditions unacceptable, if not illegal, in this country. The fight preceding passage, however, was an all too rare moment when everyday Americans focused on the impact of trade policies on workers' living standards at home and abroad. When NAFTA opponents discussed the shift of American jobs to low-wage workers abroad and linked free trade to corporate exploitation of overseas workers, Nike's labor practices in Indonesia could be understood as part of a broader global economic agenda. The NAFTA debate put the perils of free trade in terms understandable to the millions of Americans who lacked advanced economic degrees and who had never heard of the World Bank, and left those opposed to the treaty eager to find examples of the policy's abuses. Further, NAFTA's passage did not end the broader public discussion over trade policy. The Clinton administration was negotiating the proposed General Agreement on Tariffs and Trade (GATT) during the NAFTA debate. Although GATT did not attract as much media coverage, the American public received heightened exposure to trade issues through GATT's passage in late 1994. The debates over NAFTA and GATT enabled the American public and mainstream media to perceive a context to Nike's labor practices that may not previously have been evident.

As Americans' interest in corporate practices in the global economy was increasing, author Donald Katz presented Phil Knight with an idea for a book. Katz had written a cover story on Nike for Sports Illustrated in August 1993. Now he urged Knight to cooperate in a book portraying Nike as "the company of the future seeking to define culture through the power of sports." Katz told Knight that the book "could describe the trick of creating the kind of jobs people really want in an advanced economy. Nike was becoming something of a model for the global, post-industrial enterprise."

Having identified Nike as a positive model for the future of work in the global economy, Katz was forced to explain how Nike's global search for low-wage workers and its Indonesian labor practices were consistent with this theme. He asked the leadership of the selfproclaimed "company with a soul" to explain the situation. Knight, whose $6 billion net worth made him one of the ten richest Americans, denied charges that Nike exploited Indonesian workers: "There's no question in my mind that we're giving these people hope. This happens to be the way countries move ahead. I don't think we are doing anything wrong." Dave Taylor, Nike's vice president for production, was equally emphatic that Nike had nothing to do with alleged abusive labor practices: "We don't set policy within the factories; it is their business to run."

Mirroring the response many readers would have to such comments, Katz observed that although Nike's "moral neutrality" toward the plight of workers making its shoes was "well within historic tradition, bucking tradition has been a larger part of Nike's history than falling in line. It was hard to imagine that shareholders would mind some kind of required minimum wage safety net-which competitors were sure to be forced to copy." Realizing that he had just made the case for Nike's critics, Katz quickly backtracked, reminding readers that Nike had given employment opportunities to people who were so poor that their grandparents were "forced to eat bark off trees." Nevertheless, many readers of Just Do It: The Nike Spirit in the Corporate World would likely join its author in questioning how a "company with a soul" would allow its shoes to be made by sweatshop labor.

Katz's best-selling book provided the broadest publicity yet of Nike's labor practices in the global economy. Its primary value to the development of a national anti-Nike campaign, however, was not the few doubts it expressed in the course of its overwhelmingly admiring account. Rather it was the book's depiction of Nike as the chief exporter of a free trade revolution that would reduce workers' wages and living standards, a revolution that would be culturally sanctioned through the power of sports. Nike was not simply surfing the wave of the global economy; it was creating a model other companies would follow of a corporation seeking repressive governments and below-subsistence-wage workers to host its operations. Because Nike was the trendsetter for the unprecedented exploitation of workers in the sneaker industry, activists could readily explain to the public why Nike was their target. Further, Katz showed that Nike took pride in its Indonesian operations and insisted-against all evidence-that its Code of Conduct was ensuring decent wages and working conditions for those making Nike shoes. To counter the feeling of many Americans that all big corporations are morally corrupt so it is unfair to target any one, activists could show how Nike's relentless self-promotion and self-congratulatory stance toward its exploitation of workers set it apart. Nike's attitude toward its labor practices was akin to the apartheid South African government repeatedly praising its leadership on the issue of race relations. Nike's willingness to brag about its Indonesian operations opened itself up to charges of hypocrisy that could not be made against corporations that simply espoused a commitment to the bottom line. Activists could begin to turn public sentiment against Nike by showing that the company's claims about its Indonesian operations were false and that Nike's vaunted leadership was most pronounced in the field of hypocrisy. Nike's affirmative misrepresentations about its labor record repeatedly fueled the anti-Nike campaign. As Jeff Ballinger later acknowledged, "we could not have eventually built such a broad campaign without Nike's help."

Ballinger demonstrated how activists could transform Nike's rhetoric into assertions of corporate hypocrisy in a series of full-page advertisements he produced in November 1994. The ads were designed to produce subscribers to the Nike in Indonesia newsletter produced by Press for Change, a group formed by Ballinger that year to gather and distribute information about the abusive production practices of Nike's contractors in Indonesia. Each of the advertisements was titled with the Nike slogan "Just Do It!" Underneath the title was a quotation from either a Nike advertisement or Phil Knight, and below the quotation was a corresponding photograph. For example, the Nike advertisement stating, "There's really no time to be afraid. So stop. Try something you've never tried. Risk it. Demand a raise," appeared above a photo of an Indonesian woman described in the caption as having been "murdered for asking for a raise." The remainder of the ad detailed the woman's case and noted that Nike gave away $7 million in sports equipment to colleges in 1993, while the total wages paid to its twelve thousand Indonesian workers that year was only $5 million. A second ad coupled the Nike slogan, "You know when you need a break. And you know when it's time to take care of yourself, for yourself. Because you know it's never too late to have a life," with a photograph of a young Nike sweatshop worker. The next paragraph discussed how Indonesian women had no time to "take care of themselves" because they are forced to work sixty hours a week, often for even less than the government's minimum wage of $1 per day. It also notes that when Nike's female workers tried to organize in order to "have a life," their efforts were defeated by government security forces.

In the ad quoting Phil Knight's explanation of Nike's corporate philosophy—"Everyone up to speed. Everyone on the same squad"—a director of a U.S.-funded wage monitoring campaign is quoted as having been told by a Nike Indonesian manager, "I'm your worst nightmare." The ad then asks, "Same squad?," as a photograph of Nike workers showing proof of illegally low wages is juxtaposed with Knight's photo, carrying the caption, "Phil Knight. Billionaire."

The clever inversion of Nike advertisements would become a consistent hallmark of anti-Nike activism. The ads, which ran in alternative weeklies in Boston, Portland, and Los Angeles, appeared prior to sufficient public consciousness of Nike's labor practices and did not result in a massive outpouring of subscriptions to Ballinger's Nike in Indonesia newsletter. The strongest reaction to the advertisements came from Nike's attorneys, who contacted Ballinger claiming that his statements in the ads were erroneous. No lawsuit against Ballinger was filed, however; Nike's attorneys cannily denied the activist the opportunity to prove the accuracy of the advertisements in a high-profile trial. Although the Boston Globe and the New Republic ran articles in 1994 on Nike's labor practices, the mainstream media's lack of consciousness of the issue became clear during President Clinton's visit to Indonesia in November of that year. Clinton used the trip to laud Indonesia's commitment of free trade, and neither he nor the accompanying media discussed Nike's labor practices or addressed what free trade actually meant for Indonesian workers.

The media's lack of interest in Nike's Indonesian affairs persisted throughout 1995. The chief media advancement that year came from a major article by Cynthia Enloe in the March/April Ms. magazine. Enloe's article ("The Globetrotting Sneaker") exposed Nike's exploitation of women workers to an audience that would be particularly interested in the issue and emphasized the contrast between Nike's advertising campaign stressing women's empowerment with its reliance on female sweatshop labor. Enloe described how in the 1980s women workers in South Korea had overcome their society's traditional notions of feminine duty and had organized independent of male-dominated unions to win significant pay increases. The women also made sure that management addressed such issues as sexual harassment and health care. But she noted that Nike's "Just Do It" advertising slogan then took precedence over its women's empowerment campaign: "In response to South Korean women workers' newfound activist self-confidence, the sneaker company and its subcontractors began shutting down a number of their South Korean factories in the late 1980s and early 1990s." Nike then shifted its facilities to China and Indonesia, both of which "are governed by authoritarian regimes who share the belief that if women can be kept hard at work, low paid, and unorganized, they can serve as a magnet for foreign investors."10 Enloe's piece was the longest description of Nike's overseas labor practices yet to appear. It was also the first to highlight Nike's women's disempowerment strategy, providing an analysis that has helped draw women activists to anti-sweatshop campaigns. Nike's spokesperson did not dispute any of Enloe's facts but disparaged the article by claiming that, unlike the New York Times or the Wall Street Journal, Ms. "has an agenda-to improve women's rights worldwide." Was this not also the agenda Nike claimed to espouse in its ads?

No major media followed up on Enloe's piece or on Nike's provocative response. Activists continued to have difficulty through the end of 1995 getting mainstream media coverage of Nike's practices. Max White, whose Portland, Oregon, Amnesty International chapter focused on Indonesia and led him to help found the organization Justice! Do It Nike, was particularly frustrated by his inability to get material on Nike published in the media market that included Nike's headquarters. White recalls that as late as 1995 "it was a major coup for me to even get a letter to the editor printed in the Oregonian."

In case the mainstream media's lack of interest in Nike was not sufficiently discouraging, 1995 was a banner year for the company. Nike's revenues rose 26 percent to more than $5 billion. Nike's spectacular profits no doubt led some to conclude that the activists' efforts to reform Nike had failed. A truer picture, however, could be seen from Phil Knight's introduction to Nike's 1995 annual report. Knight wrote that, as successful as Nike had been in 1995, he remained "angry and frustrated" at attacks on Nike's labor practices. As the company's founder, Knight had clearly been wounded by activist criticism. His sensitivity to attacks that had not yet appeared in major mainstream media outlets and of which most Americans remained unaware showed that a strategic opening for pressuring Nike existed regardless of the company's economic success. In 1996 activists were finally able to seize this opening and mobilize nationally against both Nike and the corporate approach to the global economy of which Nike was the most prominent proponent.

 

The Movement Emerges

Several factors led to the transformation of activists' opposition to Nike into a broad, publicly recognized movement in 1996. In addition to Ballinger and others having laid the factual and thematic groundwork for a national campaign, the seemingly sudden emergence of widespread public criticism of Nike's labor practices was attributable to the exposure of Nike's wrongdoing in the New York Times and other mainstream national media, the public and political fallout over talk-show host Kathie Lee Gifford's connection to Honduran sweatshops, the entry into the anti-Nike campaign of key groups such as the faith-based investment community and Medea Benjamin and the labor and human rights group Global Exchange, and public exposure of Nike's misdeeds in Vietnam. Associated with all of these factors was the anti-Nike campaign's ability both to capitalize on media opportunities and to create events that enabled a now-interested media to continually cover the issue.

The first crack in the national mainstream media protective covering of Nike came from a source held up by Nike as the model for journalistic objectivity: the New York Times. Reporter Edward Gargan's March 16, 1996, article told the story of twenty-two-year-old Tongris Situmorang, who worked at a Nike factory until he was fired for organizing workers to demand an increase in their $2 daily wage. After his dismissal Situmorang was locked in the Nike plant and interrogated for seven days by the Indonesian military, eager to learn of his labor activities. Gargan noted that government crackdowns on worker organizing had grown increasingly common in Indonesia, a development that led the blue jeans giant Levi Strauss to leave the country in 1994. Gargan stated that by contrast, "Nike, whose shoes are made in thirty-five plants across Asia, has expanded in the region to take advantage of cheap labor." Nike spokesperson Donna Gibbs is quoted by the Times as saying that she was unaware of Situmorang's case, but then saying that "our information is that workers were not held for a week." Gibbs subsequently claimed Gargan's article was "highly distorted or an outright lie," saying that the factory was instituting a new bonus program and only "seven out of 15,000 workers had a problem. Those workers taunted and harassed the others." Gibbs did not dispute the claim that workers had been fired and the military brought in, but argued that there was no "coercion" by the military.

Gargan also confirmed a key argument of Nike's critics regarding the requirement in Nike's Code of Conduct that its subcontractors pay the local minimum wage. "The problem is that the minimum wage does not provide for minimum subsistence," an Asian diplomat told Gargan. "And beyond that, the companies don't always pay what is required by law." The head of the Indonesian finance ministry stated that "the philosophy of the minimum wage is to make sure the minimum calorie need per day is fulfilled. That is the formula." Nike's vaunted Code of Conduct, even when followed, assured workers of wages sufficient to feed themselves but not family members, and left nothing to cover housing, clothes, transportation, or anything beyond the minimum caloric intake necessary to survive.

The New York Times article, the subtitle of which-"Low Wages Woo Foreign Business, but the Price is Worker Poverty"-succinctly captured the perils of global free trade, provided mainstream media confirmation of Jeff Ballinger's repeated charges about Nike's labor practices. Moreover, the Times story paved the way for further mainstream national news coverage of the issue. The Times is widely recognized as the "gatekeeper" for news stories. As media critics Martin Lee and Norman Solomon have observed, both the Times and the Washington Post "are integral to the prevailing political power structure. They publish exclusive news stories and eminent punditry that greatly influence the direction and tone of other media." Articles from both papers appear in newspapers across the country, and the Times's daily national edition has even further broadened the paper's influence. Jeff Cohen, founder of the media watchdog group Fairness and Accuracy in Reporting (FAIR), sees the Times and the Post as "sanctifying what is an issue, what isn't an issue, and who the experts are who should address each issue." Once Times editors concluded that a story about Nike's abusive Indonesian labor practices was "fit to print," editors at other publications could proceed to cover activist criticism of Nike without fear that their news judgment would be criticized. The protection offered by the Times was particularly necessary for controversial stories such as a critical article on the world's largest shoe advertiser. Newspapers like the Oregonian, whose August 1992 article on Nike by reporter Nena Baker brought it criticism from the hometown sneaker giant, provided scant coverage of activists' criticism of Nike through 1995. After the Times story appeared, the paper provided ongoing coverage of the activist campaign against Nike.

Second, the Times story gave unprecedented credibility to activists' charges against Nike. Those who have worked on national campaigns recognize the often disturbing reality that many Americans do not believe a story until it has appeared in the New York Times. In The Activist's Handbook I discuss how the AIDS Coalition to Unleash Power (ACT UP) used a variety of tactics-including a mass protest outside the home of the Times's publisher-to improve Times coverage of AIDS issues. The strategically savvy group devoted so much energy to the Times because it recognized the paper's influence in framing public opinion. For the anti-Nike forces to have their cause bolstered in the Times-and in the Business Day section, no less-was a tremendous coup.

The Times story also directly led to the public emergence of critical mainstream institutional opposition to Nike's labor practices. On March 21, 1996, less than a week after the Times article appeared, David Schilling, director of global corporate accountability for the Interfaith Center on Corporate Responsibility (ICCR), sent a letter to Phillip Knight. ICCR is a coalition of 275 Protestant, Roman Catholic, and Jewish institutional investors whose combined portfolios were then worth approximately $50 billion. Schilling's letter carefully recounted facts raised in the Times article and repeatedly asked how Nike's Code of Conduct and Memorandum of Understanding could have allowed such violations of human rights to occur. Schilling stated, "It is a basic human right to receive a sustainable wage. The problem in Indonesia is that the minimum wage does not provide for minimum subsistence." Schilling urged Nike to adopt an independent monitoring mechanism to strengthen the detection and resolution of violations of the company's Memorandum and concluded the letter by graciously enclosing "a copy of wage definitions for your reference."

It was clear from the timing of Schilling's letter that ICCR was already familiar with the controversy surrounding Nike's labor practices and was ready with solutions. The Times story gave the mainstream investment organization the media support necessary in order to make its concerns about Nike public. In addition to contacting Nike about its concerns, the ICCR was assisting the General Board of Pension and Health Benefits of the United Methodist Church in filing a shareholder resolution with Nike seeking independent monitoring of Nike factories. Two weeks after Schilling's letter, the board sent its own letter to Nike. The letter began by praising the company for adopting a Code of Conduct for its global operations. But the letter went on to express the board's "concern and interest in learning about the Code monitoring process" and encouraged Nike to report to shareholders about "initiatives taken to ensure compliance with the Code." The board ended the letter by informing Nike that it was filing the enclosed resolution for consideration at the September 1996 annual meeting of the company. As of April 4, 1996, the date of its letter, the board's investment portfolio exceeded $7 billion, including 75,200 shares of Nike stock. Nike had never received such a polite but potent challenge to its global labor practices.

The entry of ICCR and the United Methodist Church into the Nike campaign immediately enhanced the campaign's credibility. The trustees of even the most socially conscious investment funds must act prudently to serve their beneficiaries' financial interests, and they conduct their own investigation into a corporation's practices before concluding that a problem exists. As a leader in the corporate social responsibility movement, ICCR's credibility was recognized throughout the corporate world; when it celebrated its twenty-fifth anniversary in 1996, the benefit committee included representatives of Coca Cola, Pfizer, General Motors, and Capital Cities/ABC. The criticism of Nike's labor practices by ICCR and the United Methodist Church's General Board confirmed the allegations of Ballinger and other activists and created pressure on Nike from a source-its shareholders-that it could not simply ignore. Shareholder resolutions have been frequently used by religious institutions, public employee unions, and other socially responsible investors seeking reforms in corporate practices. This tactic is most effective when combined with a broader campaign that can use the resolution to attract media attention and to launch other public education efforts.

The board's proposed shareholder resolution ultimately became a public relations nightmare for Nike. Rather than trying to reach an accommodation with the church representatives, Knight allowed his anger to prevail. He rejected discussion of the resolution's call for Nike to commence independent monitoring, and when a church representative stated that his group would like to continue a dialogue with Nike about the issue, Knight told him to speak with longtime Nike spokesperson Donna Gibbs. When the representative called Gibbs the following Monday, he was told she was no longer with the company. Knight's performance at the September 16, 1996, meeting and the ruckus created by the board's resolution were seen in October by eleven million viewers of CBS's weekly show 48 Hours. Nike avoided similar negative publicity at its 1997 annual meeting by persuading the pension board to withdraw a shareholder resolution calling for independent monitoring of Nike factories. Nike publicized the pension board's decision at its annual meeting and in press releases as evidence of the organization's satisfaction with Nike's labor practices. But pension board representative Vidette Bullock-Mixon accused Nike of deliberately exaggerating the board's action, claiming that Nike, like the rest of the industry, "have a long way to go." Bullock-Mixon noted that "Nike is a savvy PR organization. They put their spin on everything."

In addition to the ongoing challenge to Nike's labor practices by ICCR and the United Methodist Church, many other religious groups have joined anti-sweatshop campaigns. On October 23, 1996, Labor Secretary Robert Reich held a press conference with representatives of thirty-six religious groups committed to using their power and resources to oppose sweatshops. Reich's claim that "the power of the pulpit will have a dramatic and sustained effect" was no exaggeration; one cannot imagine activists' successfully challenging the harm to workers caused by free trade and the escalating global economy without faith-based support. The anti-Nike campaign's initial difficulty attracting such support may have been due to the lack of unifying religious affiliation between Nike's predominantly Muslim Indonesian workers and most Americans. As other anti-sweatshop campaigns, particularly the Guess struggle discussed in chapter 2, brought more religious institutions into the cause, the campaign against Nike's labor abuses also benefited. By 1997 groups like the Union of American Hebrew Congregations, whose Reform Judaism was probably not shared by any of Nike's Asian work force, had adopted strong anti-sweatshop resolutions. Such resolutions did not single out Nike nor any other company, but they did underscore the association of Nike-one of the most high-profile targets of anti-sweatshop campaigns-with child labor and other worker abuses.

Before April 1996 ended the anti-Nike forces gained tremendous publicity from an unlikely source: Kathie Lee Gifford. Gifford, host of the national talk show Live with Regis and Kathie Lee, had followed the lead of many other celebrities by establishing her own clothing line. The Gifford line was sold at Walmart with little fanfare until Charles Kernaghan of the New York-based National Labor Committee told a congressional committee on April 29, 1996, that Gifford's clothes were made by Honduran girls earning thirty-one cents per hour laboring in sweatshops. Kernaghan's statement led to the type of media feeding frenzy that increasingly surrounds revelations about celebrities. Gifford initially denied the charges, but when confronted with the evidence, quickly broke down in tears on her morning show and vowed to use all of her power and media access to end sweatshop labor. As Gifford's story brought the modern-day reality of sweatshops to such unlikely places as People magazine and Entertainment Tonight, reporters and media outlets were eagerly searching for other examples of celebrity-backed sweatshop apparel. The search quickly led to Nike, whose $20 million endorser, Michael Jordan, was in the midst of displaying his skills during the NBA playoffs. When asked by Time magazine whether Nike exploited its workers, Jordan replied, "I'm not really aware of that. My job with Nike is to endorse the product. Their job is to be up on that." Jordan's comments became a staple of stories about Nike's labor practices and even led sportswriters to unfavorably compare Jordan's attitude with that of Jackie Robinson and other socially conscious African-American sports stars.

The Kathie Lee Gifford controversy created a critical but brief opening for expanding media attention to Nike's global labor practices. If anti-Nike activists could not seize this opportunity, the issue would soon be forgotten and the best chance for winning sympathetic coverage of their campaign lost. There was also a risk, as evidenced by Time's June 17, 1996, coverage, of the pro-free trade media actually using the celebrity sweatshop issue to hurt the growing anti-Nike cause. The Time story argued that "if child-labor and safety laws were truly enforced, whole industries in many countries would collapse, at great cost to both developing and developed economies." Although Time quoted Labor Secretary Reich on the subminimum wages and appalling working conditions prevalent in the garment industry, it distinguished Nike from the pack. "We've taken a leadership role in trying to promote trade and act in an ethical way," Nike spokesperson Donna Gibbs told Time, whereas "human rights groups have their own agendas." Time noted that although the fifty-cent-per-hour wage of Nike's Indonesian work force "seems little more than slavery, it's roughly twice the country's minimum wage...[O]verall, the lot of Indonesian workers is improving." Time acknowledged that Nike's claim that it met Indonesia's labor standards actually meant little, but then, acting as if it had never read any material from Nike's critics, the national newsweekly claimed that in response to criticism, "Nike declared last week that its contractors have agreed since 1991 to a Memorandum that binds them to rules on child labor, worker, and environmental safeguards." Rather than ask activists or cite the New York Times's March 16 analysis of Nike's lack of compliance with its Memorandum, Time concluded by quoting Nike's Gibbs: "We feel that over time, our consciences, our way of doing business, has influenced the families that own these factories."

The dominant theme of the Time sweatshop story was that the primary beneficiaries of free trade and the escalating global economy are people "making pennies an hour" who must sacrifice child labor and safety laws to improve their lot. Nike's claim to have taken a leadership role in acting ethically was used as a pull quotation, and a reader who only knew of Nike's Indonesian practices through Time would likely view activists' criticism of the company as bizarre. The Time article is a good reminder that activists should not expect the same mainstream media that opposes progressive social change campaigns to suddenly convert to the cause because of heightened public interest in the issue. Fortunately the anti-Nike activists understood the need to cultivate the support of sympathetic reporters and to create media events that accurately and powerfully conveyed their message. The campaign accomplished this by placing stories through columnists and by engaging in creative actions that helped overcome their adversary's multimillion-dollar advertising campaign.

The anti-Nike campaign's emphasis on columnists rather than news stories made perfect sense for a struggle whose agenda was strongly opposed by the mainstream media. The national mainstream media's universal support for free trade and an expanding global economy was often a direct expression of its own economic self-interest and meant that the campaign against Nike's labor practices would not receive even the scattering of sympathetic news stories that had benefited earlier national movements for civil rights, against the Vietnam war, for South African divestment, and against aid to the Nicaraguan contras. Jeff Ballinger had long recognized the need to achieve positive mainstream coverage through other vehicles and had been sending material on Nike to columnists for years with little result. With the media looking for sweatshop stories in the wake of the Kathie Lee Gifford affair, Ballinger's hard work paid off when he was contacted by New York Times columnist Bob Herbert. From June 1996 to June 1997 Herbert devoted eight entire columns to Nike's labor practices, thus ensuring continued coverage of Nike's travails in the nation's most influential newspaper. Herbert's columns combined colorful titles—"From Sweatshops to Aerobics," "Nike's Pyramid Scheme," "Trampled Dreams"—with extremely persuasive text. Herbert's columns fostered growing opposition to Nike in three key ways. First, his initial column identified Ballinger and Press for Change as working to reform Nike's Indonesian labor practices. This enabled interested activists and organizations to contact Ballinger, share information, and coordinate efforts. Second, Herbert's columns consistently pointed out the contradictions in and outright hypocrisy of Nike's multimillion-dollar advertising campaigns. He noted that Nike's advertising campaign to corner the women's shoe market had won industry awards without anyone finding it "peculiar" that "a company could ride a so-called women's empowerment campaign to new heights of wealth while at the same time insisting that most of its products be made by grossly underpaid women stuck in utterly powerless and often abusive circumstances." Herbert was also among the first to publicly criticize Michael Jordan as an "uncaring multimillionaire celebrity" making $20 million a year from a company that worked young Asian women "like slaves." Herbert's attacks on Nike's advertising and its celebrity endorsers helped undermine the power of such messages or at least led some to view Nike commercials in a new light.

Herbert's columns, and those of Steve Duin in the Oregonian (part of the Newhouse media conglomerate), Mitch Albom in the Detroit Free Press (owned by the Knight-Ridder chain), Stephanie Salter in the San Francisco Examiner (owned by the Hearst empire), and many others made a far more powerful and convincing argument against Nike than anything that would potentially appear in their papers' news sections. Further, because columnists are paid to give opinions, they had the editorial freedom to harshly criticize Nike without being attacked for bias, as reporters frequently are. Whereas reporters have lost their jobs for accurately exposing negative corporate or government behavior, columnists are seldom dismissed for such reasons. Herbert's predecessor at the Times, the Pulitzer prize-winning Sydney Schanberg, was the exception, having been terminated for criticizing New York City land use policies strongly backed by his editors. Schanberg's article "Six Cents an Hour," which appeared in the June 1996 issue of Life magazine, described Nike's reliance on Pakistani child labor to sew together its soccer balls. Whether the Schanberg article spurred Phil Knight to approach the Times editorial board about Herbert is unknown, but Knight met with the Times after Herbert's fourth column. Recognizing the power of Herbert's columns, Knight requested that the Times stop Herbert from writing future pieces about Nike. The Times told Knight that it could not tell its columnists to stop writing about a particular subject, and denied his request.

National social change efforts have increasingly had to purchase full-page advertisements in major newspapers in order to get their messages out. By cultivating relationships with columnists Ballinger and his fellow activists achieved effective publicity that was cost-free. The anti-Nike campaign was particularly media-dependent because its adversary was spending nearly one billion dollars annually to cultivate a positive image. Activists could never come close to matching Nike's advertising budget, but through the media prowess of Medea Benjamin and Global Exchange the anti-Nike campaign created publicity events that expanded its base and put its powerful multinational adversary on the defensive.