October 11, 2008
Also, in April 1999, MGM-Diorva, the factory that Schaffer spoke of in his September 1999 testimony, was fined almost $1 million by the U.S. Department of Labor for violating labor laws, making it the second time the factory was fined in a year. It was reported by the Saipan Tribune:
Since April 2008, Bob Schaffer, the Republican candidate for Colorado's U.S. Senate, has claimed he shut down a garment factory in Saipan. (See this post.) He has several different versions of what he actually did. In some interviews he said he shut it down, in some he claimed that he helped to shut it down. Furthermore, the former Abramoff foot soldier has never come up with a name for the factory he claims to have shut down, even though he has been asked to name it several times.
The latest news is that one of his biggest supporters and defenders, right-wing radio talk host, Ross Kaminsky (a/k/a Rossputin), claims he can identify the factory that Bob Schaffer helped to close down. In a recent post on Politics West, Kaminsky claims that Schaffer closed down the garment factory, Little MGM in Saipan. He quotes former Rep. Schaffer's statement at the staged 1999 House Hearing as evidence:
The worst factory we went into was the Little MGM, as it’s called. After we went through the tour, the manager there was kind of annoyed that we were there. We kept him off to the side and didn’t let him follow us around and that’s where some of the worst pictures you’ll see in here are in his factory.
My experience was not the same as those who said they had been there and found things to be wonderful. I found a number of specific factories and specific incidents that I found to be offensive and believed they need some attention, clearly. Those issues I’ve discussed with a number of people and, for my part, my five-day investigation is not over. This hearing is certainly part of it and there’s still a lot of documents that we’ve requested that we have yet to receive.There was not one place in the testimony that Schaffer claims to have shut down this factory or any Saipan factory. Kaminsky claims a source on Saipan who "wants to remain anonymous" backs up Schaffer's story that he somehow contributed to closing down Little MGM. Kaminsky claims that Governor Fitial, a SGMA Director in 1999, also told him that Schaffer contributed to the government closing the factory. The problem is that it the story is just not true. There is no evidence that Little MGM was not shut down by the CNMI government.
Some Background
Several events that exposed the labor and human rights abuses and problems within the garment factories led up to the Saipan Garment Manufacturing Association (SGMA) and Western Pacific Economic Council's (WPEC) decision to hire Jack Abramoff to lobby on the CNMI's behalf in period when the CNMI government dropped his contract.
In 1998 the abuses were documented in a detailed report, Commonwealth of the Northern Mariana Islands (CNMI) Labor and Human Rights Abuse Status Report. Abramoff, SGMA, and WPEC pushed back with a statement and a unified effort to label the March 1998 Senate Hearings a "sham." They had another Abramoff foot soldier, Andrea Lafferty Sheldon of Tradtional Values Coalition (the organization Abramoff arranged to pay for Schaffer's CNMI trip) to circulate this handbill which I saved from the hearing. Following the hearing, a damning 20/20 expose was broadcast, further bringing the abuses into light.
In January 1999, a huge class action lawsuit was filed against the Saipan garment factories and as a result the CNMI was forced to have external monitoring of the factories. The lawsuit was a huge blow to the Saipan garment industry and was considered devastating not just to the reputation of the garment industry and the CNMI, but to their pocketbooks, as well.
In response to the lawsuit, SGMA launched a counter attack to refute the allegations of the lawsuit. One step taken by SGMA was to establish a Compliance Committee that would oversee a newly established Code of Conduct. The members of the Committee were mostly locals including Eloy Inos of Willie Tan's Trans-Asia Garment Forte, (Schaffer campaign contributor and currently CNMI Secretary of Finance), Annie Castro of Mariana Fashions, Moses Fejeran of Neo Fashion, Inc., Mathilde Cabrera of Pang Jin Sang Sa, Frances Lam of Onwel Manufacturing, and William Fong of US CNMI Corp. SGMA Executive Director, Richard Pierce was charged with oversight. According to a 1999 Saipan Tribune article:
In April 1999, Pierce and SGMA hired the Curt Worden Group, to produce a video to counter "relentless media attacks against the industry in recent months." The firm was recommended by SGMA's Texas-based public relations firm, Fairchild/Oppell:The SGMA Compliance Committee is responsible for monitoring activity within the Code of Conduct, including the periodic inspections of members’ facilities. Procedural guidelines have been developed wherein members’ compliance will be determined, and reports will be filed with the SGMA Board. The Compliance Committee can recommend any appropriate sanction, as well as prepare written certifications on behalf of the members in or out of compliance with the Code.
"They have a client list so impressive it’ll make ABC’s 20/20 show on Saipan picayune and petty in comparison," Pierce claimed.Later SGMA officers traveled to the U.S. to visit media groups with their new video they created to present "the truth about factory conditions, the workers’ living and working conditions, and the garment sector’s economic impact in the CNMI."
Also, in April 1999, MGM-Diorva, the factory that Schaffer spoke of in his September 1999 testimony, was fined almost $1 million by the U.S. Department of Labor for violating labor laws, making it the second time the factory was fined in a year. It was reported by the Saipan Tribune:
In February and April of last year, the department recovered a total of $560,000 in back wages for 427 workers. As a result of the latest missed payrolls, the department again fined MGM an additional $336,000 in civil penalties for repeated and willful violations of the Fair Labor Standards Act though the company has appealed the fine.In July 1999 the Compliance Committee censored MGM-Dirova. A Saipan Tribune article reported:
"These employees worked long hours for as many as 12 weeks without pay", said Alexis M. Herman, secretary of labor. "The fact that this company has been forced to pay back wages twice in one year shows its disregard for the law and disrespect for its workers".
The Saipan Garment Manufacturers Association has asked one of its members to appear for a formal hearing before the SGMA Code of Conduct Compliance Committee on August 9, 1999.Following The Compliance Committee's public notice of the censorship, MGM-Dirova resigned from SGMA, as was documented by the Saipan Tribune:
Informal conferences were held between the SGMA Compliance Committee and Micronesian Garment Manufacturing/Diorva in June to address prior wage violations and civil penalties imposed by the U.S. Department of Labor.
Although the back wages were paid to MGM/Diorva employees and civil penalties were addressed, SGMA stressed the need to ensure future compliance of its member company, by mutually agreeing with MGM/Diorva to the installation of independent payroll monitors.
Micronesian Garment Manufacturing, Inc. (MGM) and Diorva Saipan Limited resigned on Friday from the Saipan Garment Manufacturers Association, charging the group of "insensitivity " and jeopardizing its operations after SGMA’s executive director released a press statement alleging non-compliance by the company.SGMA could not have been happy with MGM-Dirova being fined by the U.S. Dept of Labor when they were working to repair the CNMI's reputation. SGMA charged monthly dues to members. The resignation meant a loss of dues to SGMA. Dues could have been used to retain the services of Abramoff during the years when the CNMI government dropped his contract. WPEC and SGMA paid for the lobbyist from January 1999 until then-CNMI Speaker Fitial schemed with Abramoff and others to get the CNMI government to pick up the tab again in 2000.
Yuk Lan Lee, general manager of MGM/Diorva, warned of legal actions against SGMA if it continues to issue "press releases or publication of defamatory remarks" by the organization against its former member.
"Your actions leave us no choice, but to terminate our membership with SGMA, effective (last Friday)," he said in his letter to Executive Director Richard A. Pierce.
According to Schaffer's travel itinerary, during his 5-day junket to the CNMI, Schaffer met with SGMA officials. It is almost certain that Schaffer knew of the factory's problems and history including the case against it by the U.S. Department of Labor, the SGMA censorship, and the factory's resignation from SGMA.
A May 2000 Saipan Tribune article states that MGM and Diorva were fined $100,000 each for failing to obey settlement terms in paying back wages. The article also said that there were rumors that the factories would shut down. In fact, according to another Saipan Tribune article, in 2000 MGM-Dirova did not renew its license to do business. This does not indicate it was "closed down" by the government.
A January 2001 article tells more of what happened to the MGM factory. It details that SGMA reinstated the factory to its membership after it became RIFU Apparel, Inc:
RIFU's history of manufacturing men's and women's clothing on Saipan began as Micronesian Garment Manufacturers.The article does not say it was closed because of Rep. Bob Schaffer's effort to shut it down. No where is there any evidence that Schaffer closed down "Little MGM" or any other Saipan garment factory.
The company resigned from SGMA over a year ago after pressure to address labor problems brought to the attention of SGMA through its Code of Conduct.
The firm suffered through numerous citations and penalties by local and U.S. Department of Labor officials for various problems, including unpaid wages to workers in 1999, but then it failed when major U.S. buyers canceled orders.
New potential buyers for RIFU stated that they would not do business with the reborn company unless it complied with SGMA's Code of Conduct and strict membership standards.
The factory was sold, renamed and refitted with new equipment under new ownership in the year 2000. General Manager Kidong Choi petitioned for SGMA membership under the company's new name several months ago.
With full knowledge of the difficult history of the factory, SGMA's Compliance Committee inspected and re-inspected RIFU's total operations and records. They also interviewed numerous individual workers and verified that the factory had indeed turned around.
Ross Kaminsky is wrong. The campaign ad and letter to Bob Schaffer written by David Donnelly, director of Campaign Money Watch, are perfectly justfied. The letter asks candidate Schaffer to expose what factory was shut down and how he received the information that it was shut down:
Political campaigns are notorious for being loose with the truth. Without evidence to back up this claim, your campaign risks abandoning it altogether. On behalf of Campaign Money Watch, I urge you to provide answers to these questions as well as any evidence that documents your answers. For our part, we have not been able to find evidence that you – or any other member of Congress – had any involvement in helping to shut down any sweatshop on the Northern Mariana Islands.
On the contrary, too many members of Congress, you among them, helped convicted lobbyist Jack Abramoff pursue his agenda to protect an economic system on the island that was dependent upon abusing and exploiting immigrant workers. Your statement that you helped to shut down a sweatshop runs completely contrary to everything known about your legislative record.
If you are able to provide evidence, we would like to see it. If you cannot, you should immediately withdraw your false claim.
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