What do the recent tragedy in Bangladesh and the state of this country’s banking industry have in common? At first blush you might say nothing, but scratch just below the surface and you will see there are many parallels.
First Bangladesh – which we all know by now is a corrupt country being run by an ineffective government where rich factory owners sit in Parliament thumbing their collective noses at building codes that no one enforces.
Then, there are the “too big to fail” banks whose CEOs know that, by virtue of their size, the government won’t let them fail for fear they will, just like the garment factory in Bangladesh, come crashing down taking the innocent with them.
Last month’s accident, which killed more than 1,000, isn’t the first one involving garment factory workers. Still, the Bangladesh government has done little to protect those who are just squeaking out a living in what’s estimated to be a $20 billion industry that accounts for more than 75 percent of the country’s exports.
Why are these things allowed to happen? The answer is simple – much like the banking industry in the U.S., the garment industry in Bangladesh is too big to fail.
But the tide may be turning, both in Bangladesh and in the U.S.
In Bangladesh there’s been a groundswell of protests with factories being burned to the ground, and demands for regulation. Those demands, which not only are being heard overseas, but also in this country where many retailers rely on those factories for cheap labor, may serve as a bellwether for the future. In the wake of massive public outcry some retailers are scrambling to respond. But for those who died, it’s too little, too late.