Right Thinking From The Left Coast
You will never live if you are looking for the meaning of life - Albert Camus

Prog-Mart
by Lee

Yesterday in the WaPo, an op-ed column beautifully states a point that I have made here countless times, that the greatest beneficiaries of Wal-Mart’s success have been the poorest elements of society.

Wal-Mart’s critics allege that the retailer is bad for poor Americans. This claim is backward: As Jason Furman of New York University puts it, Wal-Mart is “a progressive success story.” Furman advised John “Benedict Arnold” Kerry in the 2004 campaign and has never received any payment from Wal-Mart; he is no corporate apologist. But he points out that Wal-Mart’s discounting on food alone boosts the welfare of American shoppers by at least $50 billion a year. The savings are possibly five times that much if you count all of Wal-Mart’s products.

These gains are especially important to poor and moderate-income families. The average Wal-Mart customer earns $35,000 a year, compared with $50,000 at Target and $74,000 at Costco. Moreover, Wal-Mart’s “every day low prices” make the biggest difference to the poor, since they spend a higher proportion of income on food and other basics. As a force for poverty relief, Wal-Mart’s $200 billion-plus assistance to consumers may rival many federal programs. Those programs are better targeted at the needy, but they are dramatically smaller. Food stamps were worth $33 billion in 2005, and the earned-income tax credit was worth $40 billion.

Set against these savings for consumers, Wal-Mart’s alleged suppression of wages appears trivial. Arindrajit Dube of the University of California at Berkeley, a leading Wal-Mart critic, has calculated that the firm has caused a $4.7 billion annual loss of wages for workers in the retail sector. This number is disputed: Wal-Mart’s pay and benefits can be made to look good or bad depending on which other firms you compare them to. When Wal-Mart opened a store in Glendale, Ariz., last year, it received 8,000 applications for 525 jobs, suggesting that not everyone believes the pay and benefits are unattractive.

But let’s say we accept Dube’s calculation that retail workers take home $4.7 billion less per year because Wal-Mart has busted unions and generally been ruthless. That loss to workers would still be dwarfed by the $50 billion-plus that Wal-Mart consumers save on food, never mind the much larger sums that they save altogether. Indeed, Furman points out that the wage suppression is so small that even its “victims” may be better off. Retail workers may take home less pay, but their purchasing power probably still grows thanks to Wal-Mart’s low prices.

Read the whole thing.  Suffice it to say that it’s vindication for a position I’ve held for a long time.  If Wal-Mart were to go away tomorrow, the poorest in society would have to start paying higher prices for food and clothing, the essentials of life.  Even if there isn’t a Wal-Mart in their immediate area, the very fact that Wal-Mart exists forces other retailers to keep their prices lower.  Wal-Mart is the best thing that ever happened to the poor in America.  It’s too bad that the left is so blinded by its hatred of corporations that it can’t see this obvious fact.

Posted by Lee on 11/29/05 at 07:40 AM (Discuss this in the forums)

Comments


Posted by on 11/29/05 at 09:23 AM from United States

Wal-Mart is great. It’s fun to go there and buy stuff for nearly free.

The parking lot is scary! Your car *will* get dinged unless you park way off in the corner or across the street. One day I saw this limping lady with a cane get out of her car parked in the handicapped spot; she had a card letting her park there. Some customer who did not even want the spot himself railed at her accusing her of faking her injury to park there. They argued. It’s all part of the fun, the joy, of shopping there.

Posted by on 11/29/05 at 10:20 AM from United States

I don’t shop at Wal-Mart much, but not because I have any objections to their business model.  I typically find what I want at Costco, which is far more convenient for me to shop at as there are a zillion of them in Seattle and only 1 Wal-Mart.

But when I was looking for a new gas grill, Wal-Mart had the best prices and selection in town.

Posted by BKAY on 11/29/05 at 10:36 AM from United States

I have a Sam’s Club/Wal-Mart complex less than a miles drive my house, the only time I don’t shop there for everything, is when some local chain has a great special. And then I only buy the special, and next it’s off to Wal-Mart for the rest of the weeks groceries.

Posted by on 11/29/05 at 11:38 AM from United States

I have given up and started buying groceries at Wal-Mart. (Except for meats and certian types of veggies; which I still by at the local real grocery store)I have found that I save about 20-25% on average over the Grocery Stores’ sale prices.

Assuming that a family of four would spend about $150 per week on groceries and miscellaneous other consumer goods, (Clothing, etc.) Every household in the community would save $1440 per year shopping at the Great Corporate Satan…

...That is the equivalent of a 10% raise given to every poor family in the community. How is that bad?

Also, last time I checked, Wal-mart was not suffereing from a labor shortage which indicates that their employees are reasonably content with the pay and benefits; especially when the Mom and Pop stores that allegedly close down don’t pay that much better anyway.

So wht exactly is Wal-mart evil?

Posted by Drumwaster on 11/29/05 at 11:44 AM from United States

For me, Wal-Mart isn’t so much a sponsor of evil as a residence for it. if you have ever been to a Wal-Mart here in SoCal, especially on the weekends or around holidays, you’ll find it crammed to the gunwales with some of the worst-behaved, rudest, non-English-speaking shitheels it has EVER been my misfortune to share a planet with.

People that let their kids run wild and whose carts block the aisles, yet glare and curse at a polite “Excuse me”.

For one such numbskull who was clearly deliberately ignoring me after two such polite requests, I reverted to truth: “Just in case you didn’t know, that’s the polite way to say ‘get the fuck out of my way, you jackass’...”

They moved immediately.

Posted by on 11/29/05 at 11:48 AM from United States

So wht exactly is Wal-mart evil

Because they’re the biggest milk cow out there and the labor unions can’t get their lips on the teats.

My stock Wally World comment is that I have yet to see anyone with a gun at their back being forced marched into a store by blue vest wearing associate. 

Wal-Mart has also made specialty shops much, much better.  Wally world seldom has the exact outdoor hobby items I need.  I get them from stores that specialize in them and I pay extra for it.

Anyone know Inglewood, CA has benefitted since they drove Wal-Mart away? Locally the gas station owners benefit from me as I have to drive farthe to get whjat I need since our local neo-liddite town council won’t let them near.

Posted by Miguelito on 11/29/05 at 01:22 PM from United States

In the news they’ve been saying how Wal-Mart online has surpassed even Amazon for online sales.

Guess those people that think the company is a scourge on the nation are being sure to boycott the company eh?

Posted by on 11/29/05 at 01:46 PM from United States

I read this in the New York Times today… It was on the very last page of the A section on the right side (not the back of the last page wich is reserved for advertising, but the inside of the last page).

Oh, that Liberal Media

Posted by Helo on 11/29/05 at 01:51 PM from United States

It’s too bad that the left is so blinded by its hatred of corporations that it can’t see this obvious fact.

Not to sound like a schmuck, but does anyone have a reason as to why the left hates corporations so much? Is there an actual reason, or are they just the most convenient thing to hate at this point in time?

Posted by on 11/29/05 at 01:57 PM from United States

but does anyone have a reason as to why the left hates corporations so much?

I think it’s because their mentality doesn’t allow them to understand things like economics and how to run a business.

Posted by on 11/29/05 at 04:34 PM from United States

Oh, it’s obvious.  Mega cooperations make too much money for the taste of liberals who I like to think of as borderline communists.  They’re essentially the business equivalent of rich people.

Posted by on 11/29/05 at 05:47 PM from United States

Ah yes. After all of this bleeding heart crap about evil Wal-Mart busting unions, I finally get a peice of data that shows economically Wal-Mart is good. Conservative numbers always beat liberal feelings.

Posted by Dan Kauffman on 11/29/05 at 07:58 PM from United States

but does anyone have a reason as to why the left hates corporations so much? Is there an actual reason, or are they just the most convenient thing to hate at this point in time

Socialists get upset at the concepts of Capitalism, Private Enterprise and Private Property.

Posted by on 11/30/05 at 08:27 AM from United States

States also benefit from the collection of sales taxes because small retailers are notorious for underreporting sales tax receipts particularly on cash sales.  Big public companies can’t get away with that stuff even though their prices are lower, sales tax receipts per purchase are lower but actually reporting and payments are higher.  Plus the costs of tax administering a bunch or Walmarts is much lower than the dozens of stores they replace.  This is the dark and dirty secret of why states support Walmart and their ilk.

Posted by on 12/01/05 at 09:05 PM from United States

It’s really a shame they treat their workers so bad… unaffordable health care, working off the clock… not to mention the fact that most of their products from overseas and they hurt small businesses.

I have a friend whose mother works at a Wal-Mart in Oregon so I hear all sorts of bad shit coming outta there.

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