Carping at Wal-Mart has become the latest fad among the well-to-do, 'social justice' set. Here's Meathead, Rob Reiner, who incidentally can afford to not shop at Wal-Mart, taking a strong stand:
Communities across America are saying enough is enough and banning Wal-Mart from their city limits. Greenwald lays bare the notion, propagated by today’s robber barons, that American consumers will sell their soul for cheap t-shirts. Instead, we see the strength that comes when local government that truly reflects the values of its citizens: a respect for family-owned businesses, a recognition that a person’s labor should not be given without a living wage and benefits, and the repudiation of manufacturing that cares not for worker safety and environmental protection.
Reiner's assertion that 'American consumers will not sell their soul for cheap T-shirts' along with electronics, housewares, groceries, etc... is apparently wishful thinking. Wal-Mart enjoyed better than expected results as the holiday shopping season has begun. But Reiner is not alone in his hope. Other Hollywood types, town councils and politicians, mostly in ill-advised attempts to tamper with the market, have been looking to clip Wal-Mart's wings for some time. In an unprecedented move, the Maryland legislature is considering forcing Wal-Mart to boost their spending on employee health-care. Maryland's Governor vetoed the legislation, but it's up for an override vote in January. The legislation is ostensibly meant for all companies, but has been cleverly worded so that it would apply only to Wal-Mart. Does singling out a single employer for burdensome restrictions strike anyone as an unfair use of coercive power? Kip Esquire suggests the proper response, what he terms the 'nuclear reaction':
Dear Maryland Legislature,
If you override this veto, then we will close all our stores in your state 24 hours before the law takes effect. We will lock our doors and lay off all our employees. We will not return unless and until you revoke all legislation specifically and exclusively targeted at our company.
Love,
Wal-Mart
That's actually exactly the right response. I would join Kip in urging Wal-Mart, in order to avoid a dangerous precedent, to layoff every single employee rather than submit to the malicious meddling of the state. Another option Wal-Mart should consider is avoiding the mandate of the legislation on a technicality. The bill requires an increased amount of healthcare spending on any employer of over 10,000 (surprise: Wal-Mart seems the only employer in the state to fit the bill) employees. Wal-Mart should consider closing just enough stores in the state of Maryland so as to fall under the 10,000 employee threshold.
Of course, if Wal Mart closes stores in Maryland it will be the consumers, especially the low income consumers who most need Wal Mart's low prices, that will suffer the most:
The study by the economic research firm Global Insight concluded that the discounting along with other measures led to cumulative savings for consumers of 263 billion dollars between 1985 and 2004, or 895 dollars per person.
The researchers concluded that Wal-Mart had a positive impact on US employment, generating 210,000 jobs by 2004, or 0.15 percent more that would have existed without Wal-Mart.
The report also found that Wal-Mart's low pay for employees led to a 2.2 percent drop in overall wages across the economy but maintained that this was offset by falling consumer prices.
"Consumers earned less in nominal dollars, but their income bought them more in the economy with Wal-Mart because of real disposable income gains," the study concluded.
Here's John Stossel offering perspective:
"They have taken the values, the morals, the ethics, fairness that are the fabric of our society and put them aside and . . . put their profits before their people," said Blank.
That's foolish economics, and not very good morality. He is as wrong as the tycoon Michael Douglas played in the movie "Wall Street," who said: "It's a zero-sum game. Somebody wins. Somebody loses. Money itself isn't lost or made, it's simply transferred."
That's a myth. Businesses create wealth...
Their becoming rich doesn't mean there's less for the rest of us. Sam Walton's innovations created thousands of new jobs and allowed millions of Americans to save money...
Wal-Mart's critics act as if economic competition were a "zero-sum game" -- if one person gets richer, someone else must be getting poorer. If Wal-Mart's owners profit, we lose. But the reality is exactly what our ordinary language tells us: We make money. We produce wealth.
Wal-Mart created wealth. It started with just one discount store. Then, its owner, Sam Walton, invented new ways to streamline the supply chain, so he was able to sell things for less and still make a profit. By keeping prices low, Wal-Mart effectively gives everyone who shops there a raise, its own employees included.
Of course, as politicians, Hollywood, and the liberal elite join forces, most of that is forgotten in the feeding frenzy - a frenzy meant to destroy Wal Mart while protecting the small companies which the elites find so much more aesthetically pleasing. They do so at the detriment of the everyday consumers.
