November 23, 2003
WAL-MART....The LA Times is running Part 1 of a 3-part series on Wal-Mart today. Pretty interesting reading, even though the basic Wal-Mart story is familiar by now. Here's the nut:
company has prospered by elevating one goal above all others: cutting
prices relentlessly. U.S. economists say its tightfistedness has not
only boosted its own bottom line, but also helped hold down the
inflation rate for the entire country. Consumers reap the benefits every
time they push a cart through Wal-Mart's checkout lines.
Yet Wal-Mart's astonishing success exacts a heavy price.
By squeezing suppliers to cut wholesale costs, the company has
hastened the flight of U.S. manufacturing jobs overseas. By scouring the
globe for the cheapest goods, it has driven factory jobs from one poor
nation to another.
Productivity gains have made goods
increasingly affordable since the Industrial Revolution, but there have
been other factors at work too. In the mid-20th century, thanks in
part to vigorous unionization, American businesses steadily paid their
workers more, thus creating a growing class of people who could afford
the products they made. Wal-Mart, by contrast, pays their workers less, which allows them to cut prices and therefore makes their products affordable to more people.
So which is the better and more sustainable model? Increasing the
overall affordability of goods by creating a larger class of people who
can afford them? Or increasing the overall affordability of goods by
squeezing the blue collar workers who make them and thus lowering
Both models work, but one works by building up the working class and the other works by tearing it down. I'll take Door #1.
Posted by Kevin Drum at November 23, 2003 11:05 AM
Kevin's a commie! Kevin's a commie!
Seriously, though, maybe I don't have enough of the unionizing
spirit, but it looks to me like the Wal-Martization of commerce is
inevitable until we have something like a global middle class, and there
are no more poor countries upon which to fob off labor, which,
y'know... could take a while. Given how easy it is to organize,
transport, and shuffle the means of production these days, I just don't
see what force could persuade a large business to do the right thing by
people of one particular country (namely ours). Unions are outgunned in
a world where countries desperately fight for the favor of
Hope, anyone? Any optimists out there?
Production is one thing, and it's a complex subject.
However, the actual workers at Wal-Mart, who obviously can't be
outsourced to Bangladesh, are quite another. What's the excuse for
paying them so badly? Unionization of Wal-Mart (and other retail
outlets) would not send a single job overseas.
The best way to evaluate WalMart would be to look at the costs and benefits, and see how they line up.
-Low prices, general deflationary impact on economy
-Destroyed local businesses
-Impurvious surfaces and reshaped drainage patterns
-Paying shit wages, and in some cases violating labor laws
-Cynically taking out life insurance policies on its own employees, with WalMart as the beneficiaries
-Censorship of music
-WalMartification of American tastes
Yeah, I'm with you, Kevin.
This is like a lot of the bad corporate practices in our society:
they only work with the complicity of the consumer. Vote with your
dollars. Boycott Wal-Mart.
In a somewhat related matter..
A friend, who owns a fairly good-size plumbing shop, started buying
his materials and tools from a large chain of building supply 'depots'.
He said he had heard later that said store, thru the power of volume
purchases, was able to demand that tool, and faucet supply
manufacturers, replace some of the innards of the products with cheaper
parts to bring the prices down even further. I've yet to read a
verification of this and wonder if others have heard the same thing, and
if Walmart, also, has ever been accused of similar practices...in
addition to some of the other sleazy things they've done.
I hear a lot of criticism off wal-mart but i rarely hear of anyone who has sworn-off shopping there.
Back in 1991, I tried to return an item that I purchased - they
treated me super shitty about the refund and I've haven't shopped there
Maybe if they'd treated me well I'd still be shopping there today. Who knows?
The point is, I stopped shopping there for reasons that have nothing
to do with their business practices. Now that I know more about them I
am even more dis-incented to shop there (their constant christian
moralizing doesn't help, either). Are their ruthless business practices
enough to turn other shoppers away, or is this an empty discussion?
A stable middle class in an industrialized society has been key to
most of what we are used to in this country, and is touted as the
cornerstone of stable countries worldwide. When did that occur in U.S.?
Many historians point to the reforms of progressive movement, and the
20s and 30s reforms in labor laws.
People moan about growing class stratification and wealth, but take a look at U.S. circa 1910 for a real eye-popping example.
Unions create their own problems over the long term, and no one has
come up with a good solution when a union has proced its company out of
the market. But paying people at a basic store like Wal-Mart at a level
that leaves them nearly at poverty level has got to be a long term
Other part of LA Times article not mentioned by Kevin is the
aggressive and frequently illegal anti-union tactics by Wal-Mart.
Welcome to the new millenium. I guess unions are the "old" econmic
model and have to make way for the "new."
Anyone note that by fiat Bush administration also got their
anti-employee overtime rules through Congress, despite prior majority
votes against it?
And once again, these new rules were championed as "reform" for the "old" rules.
So much for if its not broke, dont fix it.
Over the years, I have known several people who have worked at
Walmart, including some close relatives. There are some valid
criticisms of how Walmart treats its employees. At the same time, there
are some good things to say about it. When compared to similar
companies, my relatives, for example, believe it is one of the better
companies to work for.
Americans strike me as the most self-absorbed, vain, isolated people that one can come across.
A company ships work overseas where it raises the living standards by
orders of magnitude, but causes a little pain at home - and you think
that your God given right to prosperity at the cost of all others - is
Stop and think about that. Do you now understand why the rest of the
world has trouble believing that you are actually interested in doing
any good in Iraq?
Either you are incredibly foolish or incredibly selfish as a people. Which is it?
Am I correct in understanding that certain corporations are not
interested in retaining employees over time? That it is easier to hire
new people every year than it is to deal with raises and benefits
acruing from time served?
I wonder why WalMart is the target of all these worker treatment
attacks. It strikes me that working in fast food at McDonalds and
elsewhere pays less and offers worse working conditions than WalMart.
And I think are a number of other jobs that sound less appealing than
working at WalMart. I guess it's the price of success. It's ironic that
at the same time we are concerned about the jobless (or jobloss)
recovery it is popular to bash the nation's largest employer.
And yes I think higher wages at WalMart would result in fewer jobs.
Now you can argue that it is better to have fewer jobs with better wages
and working conditions like is basically the policy in many European
countries, but I don't think everyone can just get paid more money
without any negative consequences at all. If that were so we could just
set the minimum wage at $25/$30 per hour and make a lot of people's
lives a lot easier.
I saw in the past couple days (through a link from some blog, which
one I forget) a business article about Costco and how they've been
stomping Walmart's warehouse division Sam's Club despite being smaller,
paying more, and giving better health benefits. The president there
feels that cutting employees' wages and benefits is a shortterm idea
that cripples the company in the long run, and his track record suggests
he's right. I mean, he's going toe to toe with Walmart's clout, and
You might read the Forbes article on Costco-- a company that lowers prices and pays decent wages.
Fortune.com - Investing - The Only Company Wal-Mart Fears
WalMart is doing more to prove Ricardo's "Iron Law of Wages" than any economist ever could.
The nation's largest employer is not Walmart. It is ManPower, the temporary employment agency.
And as a non-selfish American, I am interested in this new
globalization of the middle class concept being sold. Will the new
middle class in the US be expected to be comparable with world wages? I
understand $8,000/year is a good living in India for a programmer. Is
that what we should be looking forward too?
The best solution for most problems like this is to figure out which
percent of "free market" and "market regulation" works for the best
amount of people.
The real curiosity here is that, because Walmart's purchasing power
is so huge, it can effectively regulate the market itself, as a single
No, it's not a monopoly in the classical sense, as there is a lot of competition on the retail side.
But it is single-handedly exercising other types of market controls,
apparently outside of the normal "handle" that government has on things.
I'm not at all sure what can be done about this.
"However, the actual workers at Wal-Mart, who obviously can't be outsourced to Bangladesh"
Are you sure about that? I just had an interesting idea. Sure, it's a
bit like the 50s vision of the Supermarket of the Future, but it might
work, and it would result in jobs being outsourced.
As for the Wal*Mart in the Los Angeles Fishwrap-Enquirer:
"By squeezing suppliers to cut wholesale costs, the company has hastened the flight of U.S. manufacturing jobs overseas. By scouring the globe for the cheapest goods, it has driven factory jobs from one poor nation to another." [emphasis added]
This type of "reasoning" shows why the LAFE is a third-rate rag. The
company has little to do with it. The company wouldn't exist if people
didn't shop there. The company is just enabling market forces to work.
If it weren't Wal*Mart, it would be Tarzhet or KMart or LWMart. Anything
else would require a "liberal" statist approach.
WalMart certainly doesn't need me to defend them, but I do feel compelled to say one or two things here.
Saying that WalMart destroys local businesses is saying that they're
extremely competitive. Customers often prefer lower prices and wider
selection. If one-off or regional competitors can't compete with WalMart
on this score, that's not WalMart's problem.
WalMart is not under any obligation to sell music (or magazines or
books) that they find morally offensive. WalMart has rights too.
I don't know what one might mean by the WalMartification of American
tastes, though I suspect it has something to do with a classist elitism.
(It's like supposedly fighting for the poor and working class and at
the same time insulting them.)
I think you all are underestimating the impact of low prices. It's
not just a matter of money. It's a matter of people, working class
people, being able to afford a lifestyle that they couldn't otherwise
afford. When a WalMart opens in a town that didn't have one before,
there's excitement about the possibilities that will open up (I've
experienced this first-hand). High-falutin' economic theories don't take
that human feeling into account. (End populist rant.)
Having said all that, I do realize that WalMart is building up a
sorry record of labor abuse and should be prosecuted to whatever extent
the law demands.
Also I prefer Target. It's slightly more expensive, but I've found
that whatever it is that Target offers above WalMart is worth the
increased price and I can easily afford it. But it's the right of the
consumer to make any choice he wants about where he shops, and to use
any criteria to make that choice.
Also, next time (first time?) you go to a Wal*Mart, look at the
people's badges. See how many of them have worked there for at least a
What is it that working class people are buying at Wallmart that they
cannot afford elsewhere? Oddly, I have never been to one. (I've never
lived anywhere where there was one nearby.)
This theory about two models is simply untrue.
It was said by the 19th century economist Say that production creates its own demand.
Although this "Law of Say" is not strictly correct because it does not
take into account the monetary system the underlying logic is valid.
Economists (and your beloved Paul Krugman particularly) have long been
exasperated by the ignorant public and journalists making amateurish
statements about the economy and economic policy.
Its high time for all of you to realise that so-called "underconsumption
theories" (e.g. that because of lower wages of workers there will be
insufficient demand for the products and services produced by these same
workers) are illogical and simply wrong, wrong, wrong
BTW even Karl Marx derided this kind of "theories". And this tale
about Henry Ford is just that - a tale. I dont know maybe he was stupid
enough to think that its a good way to create demand for his cars by
paying higher wages to his workers, but one thing is clear and
undisputable the demand for his cars did not derive from his own
expenditures on workers' wages. its simply impossible because wages are
only a part of the cost of products.
Aaron: I couldn't name a single product that WalMart sells that, if
WalMart didn't exist, working class poor couldn't afford. It's more that
the total impact the chain has allows people to have more stuff that
they want. Add up $29 VCRs, $12 shirts, $79 TVs, $15 dinnerware, etc,
and over a year, say, you've got a better standard of living than if you
had to pay double for those items and had to pick and choose among
which was more important.
If you're a college graduate and/or professional earning better then
the national average, these may seem like the lamest of goods, and for
you, that may be so. But for people earning less than $20k, the
reasonable availability of these items from a chain like WalMart (and
they're not the only such provider) is a great boon.
It's the middle and upper classes who can afford to incorporate
political matters into purchasing decisions. Is this company green
enough, or labor-friendly enough? When money's tight, that question
usually isn't worth 2 bucks.
i rarely hear of anyone who has sworn-off shopping there.
i don't shop there. Raleigh's a big enough town that i can get
everything WM sells someplace else, without having to further fatten the
pockets of 5 of the 15 richest people in America.
in my hometown, however, thanks to the new Super WalMart, smaller
stores are drying up, along with the manufacturing jobs Kevin mentioned.
Anyplace there is a Wal-mart and there is some traffic problem, it is
not my #1 favorite store, it is too crowded, too much noise, and the
lights iritate my eyes: I don't go in there anymore.
Such stores killed the little stores and the little business in the USA.
Most of the manufactured products come from the third-world anyway so
it does not do anything really good to the american economy itself and
if you look at the manufacturing production in the US, it has been going
down the hill: if you want to relaunch the job at the manufacturing
level, Walmart won't do it.
Of course it is easier to employ a 10 years old indonesian child working
for peanuts to produce the good and importing the goods than employing
an american worker, this is how most of the stores do it: they finance a
loan to a third-world country to raise the productivity and make them
dependant from the loan so they can negotiate lower prices, the
counterpart is of course an erosion of the middle-class in the US.
Wasn't Ford's innovation not to pay his workers enough to afford his
cars, but rather to reduce his cars' prices so that his workers could
name: A very good point. Much of the anti-globalizaton movement is
convinced that factory jobs moving to developing countries is bad for
the workers in developing countries. But with the exception of a few
anamolous forced labor incidents, for most of developing country
workers, these factories offer an opportunity above and beyond what was
available to them before.
And isn't it strange that American workers and unions are fighting to
keep jobs in the US which the anti-globo crowd say are bad for these
countries that want them? Yes, I know there are labor and environemntal
concerns. Is there a way to transit from a 19th Cent agrarian economy to
a 21st Cent information economy without the messy 20th Cent industrial
economy? I'd like to hear about it.
There's an unholy alliance between the anti-globos and American
protectionists. Neither is much concerned with the advancement of the
Ford raised his wages to $5/day because his turnover was too high.
Factory work is hot, and miserable. They would have buckets next to
work stations for urination. Ford had his own secret police to maintain
So, it's not surprising that he had to raise wages above what people made in other blue collar occupations.
Auto unions got rid of some of these abuses, but it's tougher to get rid of bad workers.
I think we need to differentiate between two of Wal-Mart's
techniques. Breaking the law by hiring illegals and paying them
sub-minimum wages cannot be an acceptable alternative for competing
according to the rules other stores adhere to. As such, Walmart should
be prosecuted and boycotted (I don't shop there anymore).
Using cutthroat pricing and size to dominate and drive out rivals is a
more ambiguous situation. On the one hand they are just winning at the
capitalist game (assuming they don't break laws) and should be commended
for it. On the other, monopoly power has clear costs to society and so
there is an argument for limiting their ability to do so. I don't
think Walmart has crossed the line that argues for prosecuting them on
these grounds although that is an admittedly subjective opinion.
about "social justice" :
"..if we look beyond the limits of our national states, and certainly
if we go beyond the limits of what we regard as our civilization, we no
longer even deceive ourselves that we know what would be "socially
just", and that those very groups within the existing states which are
loudest in their demands for "social justice", such as trade unions ,
are regularly the first to reject such claims raised on behalf of
Shame on you socialist preachers of morality.
VERY well said, Kevin. Nice post.
joey jolo sez: I hear a lot of criticism off wal-mart but i rarely hear of anyone who has sworn-off shopping there.
Well, I'm one; haven't shopped at a Walmart in four years since I learned about the issues.
The difficulty is not everyone has that option. Walmart often places
their stores in locations where people don't have much choice. Either
on their own or with local government's help, they force out other
department stores/grocery stores/small businesses in low-income areas
where the density of storefronts is low. Generally they end up with a
captive consumer base because many of the people near their locations
cannot afford either the time or gas to drive long distances to
cherry-pick their shopping choices. Folks living well below the poverty
line are disinclined to go out of their way to pay higher prices for
political reasons, and can you blame them?
Sometimes the local governments help Walmart get into such places in
the belief that they will increase employment. Unfortunately, studies
have shown that the Walmart inevitably employs fewer people
than the businesses it displaced, and pays them significantly lower
wages with fewer benefits. The overall impact on that local communicy
is quite negative.
Walmart's workers need to unionize. So far, Walmart has used very
heavy-handed and potentially illegal tactics to prevent unionization,
but court challenges are ongoing and we may see a union within three or
I love comments like "Wal-mart comes in and destroys local
businesses." It's not Wal-mart that does that, it's the locals that
stop shopping at the local businesses and go to Wal-mart. I don't see
wal-mart employees marching around, rousting people from their homes and
forcing them to buy at Wal-mart, they choose to do that on their own.
So, if you're upset that they're no local businesses around after
Wal-mart came in, don't complain to Wal-mart, complain to your
The WalMartification of America is the replacment of reasonable
income jobs with minimum wage jobs. About small business going out of
business when WalMart comes to town. About the death of Main Street in
the smaller towns because everyone drives out to the nearby WalMart
(when nearby means 25-75 miles away). WalMart claims that they would
never move into a neighborhood that does not want them present. The
reality is that they spend $10,000s to $100,000s sueing to stop folks
who don't want them in their hometown.
Personally I am not sure which is the driving force behind
WalMartification: prices driven so low that companies can only afford to
pay minimum (or lower) wages (allegedly caused by the WalMart style of
bidding practices); or the economy of the USA is so screwed that WalMart
is about the only place that folks can afford to shop. Is one the
symptom or the cause? Or are they linked in a way that one cannot slay
one without killing the other?
I despise the practice of having someone at the door checking your
bags and receipts. It feels like the folks at Sams and WalMart (and
other places like CompUSA) are accusing me of shoplifting every time I
shop there. I hate it so much I will not shop at those places unless it
is impossible to buy the items anywhere else. It turns out that the
threat they are trying to mitigate with this practice are rogue checkout
clerks (not charging for items for friends). But it still makes me feel
like I have been personally insulted every time I shop there.
The article was interesting, it showed that managers at WalMart are
making 5 or more times as much money as the rest of the workers. That
explains a lot of the questions on the "personality profile" everyone
has to fill out as part of the application process. The questions are
scaled from 1 to 10 (very strongly disagree to very strongly agree).
Things like Managers should be able to take 2 hour breaks even if its
against the rules, or managers should be allowed to take things home
without paying for them. It is one of those alleged honesty tests that
are permeating the employment landscape these days, where pop psychology
tests are more important than who you are, what you can do, what you
know and what you can do for the company. The profile had a number of
questions having to do with how sticky fingered you are, but it had more
questions that had to do with your expectation of managers obeying the
rules of the company.
I have stopped going to Walmart since I started reading about the
grocery store strike. I was very glad to learn from Atrios that Costco
is OK, though. I like it much better.
Well, I've never shopped at a Wal-Mart, and I never will. Ok, I live
in Orange County, and I think there's only one around here, in Laguna
Niguel. I went there with my ex-boyfriend a long time ago to buy snow
chains for our tires, in preparation for a road trip up to Oregon.
The employees were nice, but we had to ask a question and were
directed to management. The guy was the biggest a** I'd ever had the
unfortunate opportunity to run into. It completely soured my image of
the place, and I felt sorry for the workers there.
Yes, there are many other places that pay their workers crap wages,
but Wal-Mart seems especially insidious. I will never shop there.
Americans strike me as the most self-absorbed, vain, isolated people that one can come across.
A company ships work overseas where it raises the living standards by
orders of magnitude, but causes a little pain at home - and you think
that your God given right to prosperity at the cost of all others - is
What does this have to do with WalMart.
Also, as a pro-free trade lefty, it always brings a smile to my face
to see rightists extoling the cause of benighted third-world peoples.
I'll expect to see y'all at the next human rights watch rally, decrying
the evils of child labor and the child sex trade. Remember to bring
your Che Guevara t-shirts.
Peter: The WalMartification of America is the replacment of reasonable income jobs with minimum wage jobs.
You don't say if this was in response to my questioning of praktike's
use of the word WalMartification. But if it is, then it's inadequate
because praktike referred to the WalMartification of American tastes,
which is different. You are of course entitled to your own definition
of this made-up word. Praktike was talking about something else, which
remains a deplorable sentiment, IMO, regardless of your point.
And people wouldn't drive out to a WalMart if there were no advantage
in it. There's nothing holy about Main Street- if a company can compete
with what Main Street offers, what's in it for you to lament its
passing? Same thing happened to the major urban centers 50 years ago.
IdahoEv: Walmart often places their stores in locations where people don't have much choice.
Or you could say that WalMart places their stores in places where no
other company is willing to provide service. If WalMart uses local govt
and/or zoning laws to prevent competition, I'm against it. But it's
hardly an argument against WalMart to say that they have an unfair
advantage because they cater to a customer base that no other company is
willing or able to serve. If I'm reading you right.
WalMart offers the economy of scale to rural America that was
previously only available to dazzling urbanites. Why deny the red states
this advantage? Shopping there is still wholly voluntary.
In a moment of weakness I bought a quart of paint at Walmart
recently, and discovered that the company has an automated self-checkout
system where you just pass the goods over a scanner and then put either
your credit card or cash into a machine. It worked OK, but it felt
lousy- no interaction with the humanoid that one usually encounters
while checking out- no sense of community, no anything- just an empty,
sterile experience that was really disappointing.
I'm lucky enough to live in a town that has wonderful historic
architecture on the main street, and we are pretty successfully remaking
the business district into something unique, thus Walmart hasn't
managed to suck the life out of our downtown the way it has in some
places. Enclosed is the URL for Al Norman's Sprawlbuster site- he's the
guy in Massachusetts who is a fierce Walmart watchdog.
Didn't K-mart go out of business because of wal-mart? A part of local
stores went out of business because they could not afford to offer a
wide-range of products: if the little stores cannot compete with big
corporations then they will lose customers, I don't think we can blame
only the customers, since they count with their wallets after all, but
corporations that always want higher profit-margins. I stand corrected: i
do blame walmart and other corporations.
The WalMart issue is interesting because it seems like the preservation of Main Streets would be an inherently conservative
issue, whereas it's usually liberals who decry their loss. There's a
collective action problem in that nobody actual *wants* Main Street to
disappear, but they don't realize that each dollar they spend on the
access road hastens Main Street's demise. This problem is enabled by
federal housing and highway subsidies that have encouraged people to
live in the suburbs, at a high cost to our cities and our society in
The WalMartification of American tastes, to me, is our need for more
and more and more consumption. I could also have said "Ikeafication."
There are several components:
1. Rather than buying well-made goods to last years, we throw the old
thing away and buy a cheapo new one. This, in my view, is wasteful, and
comes at an environmental cost that is not internalized in the price of
the goods in question.
2. There's a vulgar materialism to our society in that we define our well-being by how many things we can consume.
In my view, WalMart epitomizes these traits in American society.
I also no longer shop at Wal-Mart. And if Home Depot and Lowe's keep
dropping the quality of their merchandise, making me have to return
almost monthly to replace worn out parts that I had just bought the
month before, I'll find another company to fulfill my needs - just like I
did with Wal-Mart.
What's going to happen when enough people lose good paying jobs to foreign lands and have to live on Wal-Mart wages?
Nevermind! It won't really matter - those people will be in Iraq
making the place safe for Halliburton to "earn a little profit".
To the few Ayn Rand refugees on this comment thread:
Take a closer look at the Third World nations that receive the jobs
from First World nations due to Wal-Mart and similar companies'
strategies (and government strategies): Most of those people are doing
worse than when they were subsistance farmers.
How? First the bankers and financial folks come in and buy up or let
the military dictators steal land, mostly from the wealthy landowners
where these small farmers have tilled the soil as feudalistic peasants.
These small farmers, to survive, flood into larger towns and cities.
There, they end up living in shacks, with unclean water, and get paid a
pittance but can no longer make their own clothes or grow their own
If we pursued a foreign trade policy that pushed for people to be
able to buy what they produce, and this can be done if one starts with
the books and articles of either with Lori Wallach or IPS articles
(Cavanagh is the big name there).
What is lacking is the political will here. People need to connect
the dots but haven't. We're too busy arguing about whether largely
urban, economically well off homosexuals can get married. As pathetic a
discourse as one can ever imagine.
You can argue about unions, ideologies and all that until kingdom
come. But the fact still stands that the Waltons who own Walmart have
become the world's richest family by far, on the backs of people paid
less than a reasonable living. Forbes put their collective fortune at
$102.5 billion, that's BBillion. They sit at positions 4-8 on the top
ten richest people in the US. They could give up 1% of their assets to
raise the annual pay of each Wal-Mart worker $1,000, and the Waltons
wouldn't even notice.
It's pure robber-baronism, what the Waltons do. They claim a
Christian ethic in their worldview, but it's like the Holy See: everyone
else works hard by the ethic and they rake in the money like the Popes
There are a couple of ugly games Walmart plays to destroy local
shopping options that go beyond simple fair competition. One is to
figure out what the selling points of the local competition, and then
lower prices in that particular area, even to the point of losing money
-- and then raising them once the competing business closes. I recall
one friend talking about how there was a news/bookshop in her town with
an excellent selection, and then the local Walmart first opened a
similiar section with a nearly identical range, but cheaper. When the
other company went out of business, both the variety and cheaper prices
disappeared at Walmart.
The second is probably less deliberate, but still also devastating.
They'll open a local Walmart, the business district will wither and die,
and then they'll close it and several others in local towns and replace
them with a regional supercenter. So people end up having to drive
50-100 miles to get basic necessities.
The problem is not Wal*Mart, it's unregulated capitalism.
Fact is, WalMart makes us all richer.
By allowing us to buy more with our money they increase the value of a dollar.
The people that benefits the most are the poor, not the rich.
As far as all the complaints about poverty goes, frankly they are ridiculous.
WalMart clerks aren't poor - they're just less rich. They have food,
shelter, clothes, etc. Heck, they even have luxuries like televisions
and brand name clothes. By any reasonable standard (or by world
standards at any time up to maybe the seventies) they are rich as hell.
The real issue is that they aren't as rich as the rest of us.
The poor will always be with us because we keep upwards defining
poverty based on relative wealth. If we define poverty on that basis I
have no problem with grocery clerks being poor. I think a guy bagging
groceries should be on the bottom of the scale in income. I have a hard
time thinking of a job that is easier, requires less skills, and is
What this fight is really about is not whether grocery clerks will be
richer. It's about who should be on the bottom. If grocery clerks
move up due to this strike it will be at the expense of a bunch of other
low income people who will move down a bit because their groceries will
be a little more expensive. And I have yet to see a reason why grocery
clerks are more deserving.
Mike, it's a lockout, not a strike. (Do you know the difference?)
The dispute centers on the worker's unwillingness to be pushed down, not
their attempt to pull themselves above other people.
Learn a few facts before spouting ignorant opinions.
What needs to be done about Walmart is not to prevent them from
getting goods to the consumer as cheaply as possible. Except for those
who openly and fundamentally reject our economic system, that is a good
thing. What we need is such things as: 1. Mandate good health
insurance or move it out of the employment system, so they can't profit
by chincing on that. 2. Protect union organizing rights like we meant.
3. Ditto for wage and hour laws. Then let people vote with their
feet and wallets for Walmart, Target, main street or whoever wants to
open a store and give it a try.
Actually the poverty is on the rise in the US: 3.4 millions of people lived under the poverty line in 2001 (incomes
And even working at Walmart at 5.75 or 8 dollars an hour will take you under the poverty line.
Nowadays people have to settle for less because the upper-left class is getting wealthier.
Poverty line is less than 18K for a family with 2 chidren.
Worker's unwilling be "pushed down", "relentless" cutting of prices,
making money "on the backs of other people" ...interesting how language
can be used to invoke emotional reactions that aim to transcend
reason. Just an observation in this thread.
Mike has made some good points (I happen to admire Walmart's success
and productivity myself). If some of his points may not be completely
applicable to this particular grocery store situation, it's still a good
response to other comments on this thread.
Ayn Rand refugees on this site!...No, it can't be!...well, their loss :)
For some workers this is a strike. For others it is a lock out.
What's your point?
And who, exactly, is trying to push down the workers?
And Frenchy, the poverty line is based, in part, on relative wealth -
that's why it keeps going up. People below the poverty line still can
afford food, clothes, and shelter.
"I despise the practice of having someone at the door checking your bags and receipts"
I spent $28 at the Fort Stockton, TX Wal*Mart last week. I was
wearing my backpack, as I've done many times in many Wal*Marts and other
stores throughout this great land. Only a few stores have complained:
one in Maine, a couple in TN, a couple elsewhere. I didn't shop there.
The second time I went to the FS,TX WM, they complained about the
pack. I promptly went out to the car and returned as much of the stuff I
had earlier bought as I could.
Those items I returned included:
a warm fleece jacket for $9.44
several Clif Bars for $0.96
two Sam's Club 2L sodas for - wait for it - $0.50 each
I could afford to pay a bit more, but why should I? Plus, I'm real
cheap. If I go to Big Bend as planned, I will have to pay more, because
I'm boycotting that WM, and I'll have to stock up in Alpine. The fleece
jacket will be hard to replace at the same price here, and I could use
an extra layer when it's below freezing.
BTW, for the limo libs who have their maids do their shopping (just
kidding): 2L Coke/Pepsi is around $1, but some places - like gas
stations - have them for $2. IIRC, the only place I've seen Clif Bars
cheaper were when they were 2 for a buck at the 99 Cents Only store.
Trader Joe's, Savon, and other places are at least the same but probably
more than a buck. Some things can be had cheaper at Dollar Generals or
the like, but mostly WM has pretty good prices and a wide selection of
Mike, I suggest you read Kevin's other posts about the supermarket lockout/strike.
I don't understand the desire of people to be in favor of a lower standard of living in this country.
Don't forget, there's more to living than consumption. As the price
of labor relative to capital goes down, the cost of saving money goes
up. Real estate prices compared to salary gets worse, and personal
bankruptcy rates increase.
Additionally, with capital flight to other countries, the
reinvestment rate in the US goes down. By no stretch is this "making
us all richer."
WALMART is not an invulnerable beast however. If the workers and
managers in SoCal got out of their stupid, fratricidal war, they could
start focusing on the root cause of their problems, which they claim is
Walmart has the property of very large, isolated stores, and a highly
centralized distribution network (all those SAM's WAL*MART
18-wheelers.) Such a network should prove vulnerable to "extra-market
forces", a term which includes war, but is not limitted to war, or to
Picket stores. Drive tractors and trucks to distribution centers,
and park in the driveways. The French know how to do this. Perhaps
it's time that the Americans learn.
I read Calpundit for the sheer entertainment value. I find it amusing
that "educated people" (I use that term loosely) feel threatened by a
company that has made improving productivity one of it's chief goals.
You should be applauding Wal-Mart and its competitors should learn from
Business is competitive. And now increasingly global. Would you
rather have Wal-Mart to complain about or would you rather be shopping
at your local Carrefour?
I have avoided WalMart for years because the products they sell in
most categories are cheap not inexpensive. The difference being they
are not selling quality for less, they are selling garbage for more.
They started out inexpensive in a smaller store, but when they
shifted to their 'superstore' the name brands were replaced with shlock.
My mother stops there occasionally because it is convenient for her
and I have yet to see a can of anything that wasn't dented.
When they shifted to their 'supercenter', the small town that had
built roads and installed traffic lights for them had to almost
eliminate their police department. Much of local funding is based on
the sales tax and the loss of a large store is devastating for a small
The county built roads and installed traffic lights at the new
location, despite the fact that the lights destroy traffic flow on a
When they were building the new WalMart I had flashbacks to heading
down I-5 to Tijuana. The illegals used to run across I-5 in a
characteristic 'hunched-over' fashion. That's how the workers at the
WalMart site were crossing the street to get to the fast food places on
the other side, and, yes, they spoke Spanish. None of that
'high-priced' Northwest Florida anti-union labor for WalMart.
WalMart hires the disabled, which I thought was a good thing until I
found out their salaries were subsidized through a number of programs.
I work on old houses in my spare time and there is nothing worse than
encountering WalMart products. You know that you get fix them, they
have to be replaced and you have to pay 'tipping/garbage' fees to get
rid of them.
As Home Depot/Lowe's have wiped out all of the old lumber yards and
hardware stores, I spend a lot of time driving to Alabama to find part
and supplies for these old places.
Call it what you like, these 'Superstores' are not good for the
country. If you look at the stock you will see your choices shrinking.
Soon we will be just like the old Soviet Union, you will have to buy
whatever a store decides to carry in any particular category of product.
I don't see it that way.
Back in the 90s, 25% of Americans possessed 75% of the wealth in the
world. Nowadays, it represents only 44.4% of the Americans in the top
500 worldwide companies: the monetary mass in the USA altered by the
flow of imported goods is going to other countries: this year I think it
was 67 of the most wealthiest american fortune disappeared from the
classification (despite the emission of the green monetary mass).
Also if you take a look at the salary disparities, the margin difference
in the 90s between rich and poor was least in China than in the USA; it
is not the case anymore: it only means the USA is losing some markets,
either to be more productive by delocalizing or importing workers (H1B
visas) or either they cannot compete anymore and they go bankrupt. At
the same time, in the last 2 decades in the USA the salary differences
grow from 1 to 1,000: with these 2 examples there is a retribution of
wealth repartition in the US by eroding the low/middle-class, walmart is
one of the examples of this year, there are other examples like
Microsoft and IBM, it is a big megatrend this year to pay programmers at
3,000 dollars a year in Russia or India, and it will keep up this way,
at least the US is headed this way: higher profits inside or outside the
US, it is a phenomenon that cannot really be changed in a capitalistic
This is why by changing the exchange rate of the dollar to a lower
level, it will relaunch the production of manufactured goods in the USA
(made in the USA) and may create more jobs.
Walmart may suffer from it, at least for the imported goods, they are
going to take a 20% inflation increase really really soon, if it has not
been done, unless other countries like China for example devaluate
their currency to counterweigh the exchange parity policy of your gov.
The subjects needs to be examined closer though.
I don't think the US is on an economic recovery yet if they keep delocalizing and don't get some financial laws tougher.
While I may not be able to name any product that I can afford because
WalMart sells them, I can name literally dozens and dozens of products
that couldn't be bought because WalMart doesn't shelve them.
One superstore doesn't have better selection than an entire town. That's the first level of reality.
While I was at University, the town I lived in had a WalMart outside -
actually, it rented space from the local indian reservation because
they needed the money more than the other towns. Sure, they had some
things I couldn't get elsewhere at that price... But you know what?
They have nothing I couldn't get at home in a town without a WalMart.
And now that I've spent ten years in retail, I know all the more not to shop at them.
Buying a few, 'name' products from a store willing to take losses
because they know that 'name' product is the only product their
competitor sells is not competition.
they treated me super shitty ... Maybe if they'd treated me well
I'd still be shopping there today ... The point is, I stopped shopping
there for reasons that have nothing to do with their business practices.
Joey, how you treat your customer is the first business principle.
Even parity product companies can grow phenomenally if they treat their
customers well, i.e.: thoughtfully and creatively. Without that, your
balance sheet is doomed no matter what operational or financial
whizzbang you can concoct. Dude, it's retail. You stopped shopping
precisely BECAUSE of their business practice.
Now, wanna see what similar bad manners can do for US / foreign ally relations? Go here. (Shameless blog pimp alert)
Lastly, for any interested, there was a hearty thread going on the
macroeconomic impact and business practices of Walmart over at Brad
a few weeks back....and who should wander in but Surowiecki of Slate's
money box. Things got interesting there, worth checking out.
'He said he had heard later that said store, thru the power of volume
purchases, was able to demand that tool, and faucet supply
manufacturers, replace some of the innards of the products with cheaper
parts to bring the prices down even further.'.....Could Walmart be doing
this with brand name manufacturers of food?
Ooops, above should have said "doomed eventually". The finance and
ops stuff does work, but it becomes a ponzi scheme where your repeat
business drops to those who must patronize you because of your cost
advantage, but they hate doing so and will bolt at the first chance.
That isn't the profile of "higher value/deeper pocketed" return
customers who expect more. Therefore, you have to keep gobbling up new
markets and share to sustain the locomotive, because loyalty is paper
Ever wonder why Walmart uses a smiley? How about why they run all
those hallmark style ads about how they're second only to mother teresa
in good works, compassion to employees etc. PR, advance damage control.
Same thing Phillip Morris did and trumpeted for years in the arts area
and in inner city education grants, etc. They knew they were flawed, so
they tried to buff a shitty business model fraught with downstream
danger. Ditto Walmart. The backlash has begun because they're getting so
dominant in the fabric of everyday community life as well as the
structure of local/regional/national econiomies. See fastcompany.com
this month as well as the LA times.
Every car that sits in a WalMart parking lot argues in favor of the
company. They're voting with their dollars...you can call these people
irrational, but to force them to shop at a retailer of your personal
choosing is out-and-out evil.
Picketing walmart is an evil? Now that is hilarious. Nobody is
forced to change their shopping habits by a picket line. They may
voluntarily choose to go shop somewhere else out of solidarity, or
annoyance. But that's just a cost of doing business in this fallen
"Picketing walmart is an evil?"
No, p mac, put on your bifocals and read what I said: "to force them
to shop at a retailer of your personal choosing is out-and-out evil."
"To force"...not the same as picketing, is it?
I have twenty dollars in my pocket...if you tell me where to spend
it, or how to spend it, you are STEALING it. You can laugh out loud all
you want, but if you tell me such a thing to my face, you won't laugh
Well, me-o-my, who was suggesting that anybody be forced to shop at any particular retailer?
It seems more like Walmart itself forces people to shop at Walmart,
once all the other businesses in town have been driven out of business
"once all the other businesses in town have been driven out of business by Walmart."
Please. If other businesses are driven out of business, it is because customers went to WalMart.
If you try to shift government policy against WalMart, then you're
attempting to force other people's money in the direction you please.
(However, if your intentions are good, I absolve you.)
Is asking that the laws about employing illegal aliens and allowing
unions to organize legally "shifting goverment policy against Wal-Mart"?
WalMart, like capitalism itself, is a mix of good and bad. Good for
consumers, lower prices = higher consumption, greater wealth. Good for
the poorest producers in the world, more jobs. Good for its local
workers, local jobs.
Bad for competing local workers, fewer local jobs; and/or lower paid
jobs. Bad for competing local business owners, lower return on
investment. Bad for long term flexibility & choice by consumers,
since efficiency tends to standardization (see MS Word vs other word
By all means attack WalMart for it's lousy local labor practices, and
it's terrible owner/manager - worker salary issues; and fight hard to
stop any local gov't giving it any expansion breaks or building roads.
Get workers to unionize at WalMart -- an organized strike strikes fear
into the Waltons, I'm sure.
Where are the Leftists willing to join WalMart, work excellently for a
year or so (MUST have written, excellent evaluations), and then try to
unionize? Yes, join specifically to use legal means to help with a
future suit against them, showing their anti-unionization intimidation
(eg wear wire-taps, take pictures, etc.).
But in terms of reducing world poverty, the world is better off if
those foreign child workers work for WalMart than not. The rural poor
have always been better off as urban poor, horrible as urban poverty is.
Gov'ts need to protect property rights for the poor, and enforce the
duties of the rich in rich-poor contracts (rather than just enforce
duties on the poor), and punish the frauds. And gov't needs to let folk
decide to buy at WalMart, or not.
Interesting thoughts, but:
1. The poor usually have little property and therefore little nagging
worry specific to "property rights." They are poor and "indentured" to
say, check-cashing services instead of banks, or to landlords rather
than mortgage companies, or to necessity jobs that they have little
interest in endagering in the interest of "worker enfranchisement."
2. Enforce the duties of the rich in rich-poor contracts"? Sound like
Marx, not Adam Smith to me. Just kidding. The rich-poor contract thing
is exactly what's being strangled py today's political debate. Noblesse
oblige is a sneering, dirty phrase now. The Walton family in aggregate
is worth something like $100 billion, while associates in their blue
vests are pulling down say 20,000 if that. Sounds like a rich-poor
contract breakdown to me.
Walmart's becoming very akin to the "Company store" of old: can't
afford to complain, can't afford to go anywhere else, can't do much of
anything to change the situation if you don't want your lower-end of the
scale family to survive.
Shopping is shopping; shop where you want or must. Walmart's problem
comes from it's focus on price and reach. It's downfall, like A&P's,
Sears' or any other burgeoning American monopolist of the past will be
when it gets too-too big for it's price britches, and when it starts
making political and business leaders nervous about it's impact on whole
economies and industies. Too much power in too few hands and all
that..... Tick tock
of the article is up now focusing on how "Made in the U.S.A." was a
failure and how Wal-Mart was forced to get 50-60% of its manufacturing
from overseas, much from Southern China.
"I'll take door #1."
No you won't, because you're sitting on your sofa at home writing a blog.
Taking door #1 would mean rolling up your sleeves and opening a
grocery store and getting creamed by Wal-Mart, which knows how to meet
its customers' needs better than you have any hope of doing.
Wal-Mart versus the established supermarket chains in California
means the Wal-Mart team versus the chains' teams, and if you looked at
them closely as you should you would find that the Wal Mart team
consists of a lot of young and old Americans, many of them recent
immigrants, who are glad to have the jobs they have and feel that they
personally are well treated by the company.
What Wal Mart has figured out how to do is make people with fewer
formal and informal job skills more productive than their entrenched,
sometimes unionized, competitors.
Just exactly what is so wrong about that?
It wasn't that long ago there were Sunday paper articles about life in
Russia that could almost be written as a parody today using the
Wal-mart scenario as the base. Families encouraged by the state to
have too many babushkas, living on meager salaries with fears for
their future, shopping at the only business in Moscow/Las Vegas,
buying corn dogs and gallon jars of pickles manufactured by struggling
business that have little choice but to sell to the biggest
retailer. Even though the manufacturer knows that the huge pickle jars
usually end up rotting before a family can eat it all, the monolithic
retailer demands that huge container as a symbol of socialist, I mean
I didn't shop at the Russia state store and I don't shop at Wal-mart.
My question is, where is that Wal-Mart store where they film all the
commercials? I've looked all over for it but in every store I visit the
employees are not smiling and joking and falling all over themselves to
make my shopping experience the best ever - in fact, some of them look
downright pissed off, and grumpy, not to mention overworked and
underpaid and shat on by supervisors and concerned about how they're
going to pay all their bills and clothe their kids. So if anyone knows
where that really *happy* Wal-Mart is where the staff all dress up in
clown costumes and wouldn't leave even if you offered them a living wage
because they love the place so, then do please let me know.
Uh, Jk, I beg to differ.
Walmart associates skills have nothing to do with their operational
success. And beyond simple price, they--associates and Walmart--have no
clue often how to
meet [their] customers' needs better than you have any hope of doing.
Broke down and went to look at their bikes because my son wants the
one his friend's family got for him at Walmart. A customer service
nightmare. Store in disarray first. Bikes area a mess second. Third, was
passed through 3 associates to a get a simple answer about a simple
thing like color choice between the same model bike. (Answer: any color
you want as long as it's silver, even tough I'm looking at indentical
silver and blue dinged up floor models.) Next, I ask about layaway as
Christmas is a ways off and my kid can find anything in the garage.
Answer: "I don't know about that, I think we only take cash, credit card
or check. Can you find someone else to ask?"
2. Sitting in my home office with a partner. It's 10:30 at night. His
wife calls to say "I'm at Walmart, you need anything?" He says there a
new game out, Medal of Honor I think it was. Wife calls back 30 minutes
later with a long story about how noone could help her, they "hadn't
heard of it, could she look for herself maybe?"
Partner asks to speak to an asscociate to explain better. Associate
looks, still no dice. Partner knows they have it because he'd been in
during the day for ink jet cartridges, saw stacks of the game, but
didn't buy. Asks wife to look again. She calls back 10 minutes later:
there were 10 games on the shelf and 96 units in their clearly SKU'd
shipping boxes at the base of the video game dispay wall.
These two are fresh this past few weeks. Before I got completely
turned off by WMT's business practices a few years ago, I had a list as
long as my arm of ways they'd underserved, pissed off or generally
screwed my customer experience.
American business it a crossroads: The suits have ruled the roost into disrepute for many companies.
And Walmart is not alone, they have company like McDonalds, which
operates on the unspoken premise that they can screw up 4 out of 10
drive thru orders--piss people off in the result--and still operate
profitably with the kind of people and wages and culture they're willing
to promote. Of course, that was until they recently started posting
their first losing quarters in their history recently. Tick tock.
As for your "recent immigrant" jobs program contention, I'd like to
see you defend that one to the newly defunct hardware store owner or
bankrupt grocer without keeping your dukes up.
If Wal-Mart is so bad, don't shop there. That way I'll be able to get a better parking space.
First, those who believe that market forces determine all
wages/prices underestimate the power of economic coersion in
negotiating. WalMart clearly does not satisfy A. Smith's assumption
about economic players being too small to manipulate the market. I for
one am not afraid to say it: regulation is in order to check their
Second, having said that, I think the biggest problem is not the
market per se, but the values that consumers are bringing to it. I'd
wager (not that much, say $10) that a good fraction of the stuff bought
at WalMart winds up collecting dust in the attic/garage/storage-locker
after one month. My hypothesis is that the obsession with lowest price
correlates quite well with an unhealthy level of consumerism.
This comment is for "outforblood" You shoud not say anything
negative about the educated guys who do not approve of that nasty
Walmart sprawl. Most bloodsucking parasites are "outforblood" If you
do not know what you are talking about you should shut your round pie
hole. Shithead. I was an employee at Sam's Club just long enough to
learn that Walmart has a vendetta for many workers and a punishment
regimen for women- so the execs can collect on the corporate owned life
insurance. It is a hostile environment for women (and I am sure some
guys too but since I am not a guy I cant speak for them). When Sam's
tried to give me a lateral move in the company, instead of a move
up-when I did a spectacular job in my department, I did what all people
who work there should do. I did not accept it. I can get stuck in a
rut anywhere- but I am far too fine for that shit. You, "out for blood
sound like a punk who thinks he's educated; but in reality you are just
another stale number-in a staggering sea of creeps and you
dont know what you are blowing about. And by the way, you sound like a Walmart shopper.
Personally, I would want to see Fleischer throw a GameBoy (suitably
lined with lead) at Helen Thomas, but that's just a small quibble.
Didn't he actually DO that a while ago?
Only when we have nothing to say do we say anything at all.
Fashion exists for women with no taste, etiquette for people with no breeding.
Both dreams and people crash down.
Only when we have nothing to say do we say anything at all.
When free direct tv you are confident that the settings direcway are
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Free credit report online
This is the funniest war blog ever. Really, really great stuff. Keep it up.
Of course, to be accurate, Bush should have said "strategerist."
Funny - I'll tell you what is funny - Dennis Hastert getting hit by a water ballon - NOW that is funny
Everything is true to someone.