← Autodidact Archive · Original Dissent · Faust
Thread ID: 16835 | Posts: 18 | Started: 2005-02-19
2005-02-19 04:53 | User Profile
February 18, 2005 View From Lodi, CA: Washed Away By The Wal-Mart Wave
[See also View From Lodi, CA: Joeââ¬â¢s War Against Wal-Mart, View From Lodi, CA: Against Sprawl In A Small Town]
By Joe Guzzardi
Wal-Mart is in the news againââ¬Â¦nationally, regionally and locally.
Earlier this week, the U.S. Labor Department announced that the retail giant had agreed to pay a $135, 540 fine but without having to admit wrongdoing for 24 violations of child labor laws.
Over the last four years, at Wal-Mart stores in Arkansas, New Hampshire and Connecticut, employees under 18 operated hazardous equipment like chain saws and paper balers.
These latest charges are, according to US Representative George Miller (D-CA) part of a Wal-Martââ¬â¢s long-standing pattern to undercut labor standards at home and abroad wherever possible.
Meanwhile in Galt, Los Angeles developers have purchased a 53-acre commercial site with the intention of constructing a 206,000 square foot Wal-Mart Supercenter on 20 of those acres in September.
The projected Galt Supercenter would be the fourth between North Stockton and Galtââ¬âa distance of about 20 miles.
Finally, in Lodi, the News-Sentinel Business Editor Greg Kane reported that city officials have cut a new deal with developer Darryl Bowman that will allow him to keep the original agreement of leasing half of the existing Wal-Mart. Or Bowmanââ¬â¢s new options are that he can sell the property or demolish and rebuild the structure.
The bigger Wal-Mart gets, the more frightening it becomes.
In fiscal 2004, which ended January 31st, Wal-Mart sales of $259 billion ranked it as the world's largest retailer. The enormity of its sales volume has also pushed it to the top spot in individual categories as varied as food, apparel, jewelry and home furnishings.
During fiscal 2005, Wal-Mart plans to add 310 new stores and 30 new Sam's Clubs to its stable of 3,625 locations.
Retail analyst Bernard Sosnick from the Wall Street firm Oppenheimer & Co. expects that by 2010, Wal-Mart will have 3,000 supercenters, up from 1,600 this year, and total company sales of half a trillion dollars.
When that happens, Wal-Mart will become number one in dozens of other product categories. And that will put even greater pressure on companies in fields that it already dominates like clothing and food.
No company large or small would be safe. Established giants like Safeway will become memories.
To understand how Wal-Mart works, look at how it muscled Tower Records into bankruptcy.
Tower Records follows in the footsteps of earlier bankruptcy filings by Sam Goody, the Wherehouse and Musicland.
Over the past decade, Wal-Mart has emerged as the nationââ¬â¢s biggest record store and sells one of every five major-label albums.
Wal-Mart had been willingly losing money on CDs by selling many of them for $9.72. The company hoped to entice customers to buy other Wal-Mart goods while they were stocking up on cheap CDs.
But then Wal-Mart, tired of losses, demanded that the record industry sell at more favorable prices. The chain threatened to simply stop selling CDs if it couldnââ¬â¢t get the prices it wanted.
One record label executive told Rolling Stone Magazine reporter Warren Cohen that ââ¬ÅIf they got out of selling music, it would mean nothing to them. This keeps me awake at night.ââ¬Â
In the last two years, largely because of Wal-Martââ¬â¢s powerful position, more than 1,200 smaller record stores have closed.
Wal-Martââ¬â¢s domination of the music retail business means that people employed in other outletsââ¬âlike Tower, Sam Goody, the Wherehouse and Musiclandââ¬âlost their jobs.
And music lovers who might be looking for 1940s jazz or early Baroque composers will come up emptyââ¬âat least at Wal-Mart.
In November 2004, in what I view as a public service, Forbes published a list of five categories of employers that look particularly vulnerable to Wal-Martââ¬â¢s "looming threat.ââ¬Â
They are: bullet Consumer Electronics: currently number two behind Best Buy, retail analyst Howard Davidowitz predicts: ââ¬ÅThey are going to fry Best Buy's brains out."
bullet Pharmacy: Fourth in the nation behind Walgreens, CVS and Rite Aid, Wal-Mart is opening 24-hour operations and putting the price squeeze on suppliers of both prescription and over-the-counter medication.
bullet Fashion: Wal-Mart plans to upgrade its marketing from mundane items like underwear and socks in favor of selling trendier brands like the number one British apparel manufacturer, George.
bullet Gasoline: Wal-Mart stores operate more than 1,550 stations for a 3% share of the U.S. market. With its huge number of locations, Wal-Mart could go it alone. Said analyst Kurt Barnard, "The volume they could offer would be of enormous interest to refineries."
bullet Banking: Quietly considering banking for five years, Wal-Mart has a built-in market. Of the 100 million customers that shop at Wal-Mart weekly, 20% do not have bank accounts. The Sun Trust Banks operate more than 30 Wal-Mart Money Centers. And the chain offers financial services like check cashing, bill payment and money orders.
If you are currently employed in one of those five fields, you might consider updating your resume.
What Wal-Mart wants, Wal-Mart gets.
Joe Guzzardi [email him], an instructor in English at the Lodi Adult School, has been writing a weekly column since 1988. It currently appears in the Lodi News-Sentinel.
http://www.vdare.com/guzzardi/050218_vfl.htm
2005-02-19 05:27 | User Profile
I still havent made up my mind about Wally, at one time they were one of my customer and even though their payment policy were a little bit out of line they do pay.
I like Wally, I shop at Wally, today I was at Wally's, I like them and yet I don't trust them........like a beautifull enticing young woman that is there for the taking and yet there is something wrong with that picture.
In my Si-Sfi mind I keep thinking that Wally is a conspiracy to kill businesses in the US in order for them to take over and then later on they can increase their prices to what ever they want and they will be able to get away with it because there will be no where else to shop.
And the part about the family being Jewish dosen't help any because Wally would be a hell of a good way to run an espionage ring world wide.
But as long as everything looks ok then we may as well enjoy the ride.
2005-02-19 14:07 | User Profile
Walmart and the government are creating the Mill store all over again. Years ago the mill workers only option was to shop at the Mill store, which sold basic goods at inflated prices, the prices of which went up with the mill worker's salaries. Often the mill worker was in debt to the store, which was owned by the mill, and he was, in effect, a slave to the mill until he paid off his debt, if ever.
Walmart is the vehicle for the government to socialize business, a big step forward toward marxism.
2005-02-19 16:08 | User Profile
[SIZE=4][COLOR=Blue][B][I]Wal-Mart and the plucky American Consumer[/I][/B][/COLOR] dedicated to making the [COLOR=Red]Peoples' Republic of China number one in the world![/COLOR][/SIZE]
2005-02-19 16:27 | User Profile
[QUOTE=Sertorius][SIZE=4][COLOR=Blue][B][I]Wal-Mart and the plucky American Consumer[/I][/B][/COLOR] dedicated to making the [COLOR=Red]Peoples' Republic of China number one in the world![/COLOR][/SIZE][/QUOTE]
There are now 37 WalMart stores in China with plans to build five more and I am wondering what they are stocking, what kind of products, those stores with.
I don't mean stuff like dog meat, snake meat, monkey meat or magic roots because the Chinese people can buy that in the street, but what.
The Chinese merchants can give Wally a run for their money by selling their own products cheaper.
I am still expecting for Wal Mart to start selling Chinese cars here in the states one of this days and then the fun will start.
2005-02-19 23:05 | User Profile
Wal-Mart will collapse soon enough when the Chinese end the dollar peg. All of a sudden those cheap Chinese goods which make up 90% of Wal-Mart's inventory will get really expensive.
2005-02-20 01:20 | User Profile
WalMart's greatest crime seems to be it's success. At least they didn't boot the Salvation Army this past Christmas, as Target did. At least they didn't hire that dyke Rosie O'Donald to do a lot of their commericals, as KMart did. I doubt either KMart or Target sell more American-made goods than WalMart.
I wish Walmart luck in resisting unions and in pressuring the music industry to moderate the prices of over-priced CDs.
Now, what has WalMart done to bring down all this hostility? That child labor thing is small and an obvious violation of WalMart's own policies. Any big company is going to be accasionally accused of child labor law violations periodicially.
Look at the government allowing all these maga-mergers. Even Ma Bell is reforming. At least WalMart didn't buy Kmart to kill the competition. Look at how Micrsosoft has operated over the past couple of decades to see what real anti-competative behavior is.
2005-02-20 01:52 | User Profile
Happy Hacker,
I agree with most everything you said. One does worry what will happen once all the competition is gone?
2005-02-20 07:50 | User Profile
Wal-mart is a libertarian's wet dream. To hell with them.
2005-02-20 14:39 | User Profile
I must be one of the very few people in this country (maybe 2) who has never stepped into a Wal-Mart.
2005-02-20 15:37 | User Profile
[QUOTE=Happy Hacker]WalMart's greatest crime seems to be it's success. I would say Wal-mart's greatest crime is the means by which they have achieved that success. However, their success is detrimental to our society at large, whether honestly achieved or not. Wal-mart uses its size to demand constant price reductions from all its suppliers. Every year, its suppliers must reduce the price they charge Wal-mart by a certain percentage, or they are dropped. They, of course, cannot afford to be dropped, so they comply as long as they can. Eventually, they can't drop the price any more, so they are cut off by Wal-mart, and then they go out of business. Wal-mart then goes on to wherever it can find the products cheaper, such as Indonesia or China. Wal-mart is destroying American businesses by forcing them to compete directly with Chinese businesses that pay their workers virtually nothing, supply no benefits, and have no environmental regulations with which to comply.
[quote=Happy Hacker] I wish Walmart luck in resisting unions and in pressuring the music industry to moderate the prices of over-priced CDs. Unions often suffer from corruption, but they serve a useful purpose. When Wal-mart has driven every other store in a small town out of business, how much power do the employees have otherwise?
Wal-mart is basically making money by externalizing the costs of the social and economic damage they are causing. They provide 'Always Low Prices. Always' by squeezing American companies to death, taking their business to China, running all competition out of business, and destroying the diversity of small town economies. Wal-mart and Microsoft are both dangerous entities. They are the low-tech and high-tech aspects of the Janus-faced global capitalist system.
2005-02-20 18:10 | User Profile
The way to keep a person, or group of people, "passive" is to keep them happy by giving them what they want.
Once you have them under your control then you can, slowly, manipulate them to your way of thinking.
What you tell a person is not as important as to the "way" that you say it.
You never push a person to your way of thinking but "guide" him.
That's a mistake that the Jews keeps on making all the time, they are too pushy.
Like the frog in the pot of cold water you must slowly turn up the heat.
2005-02-21 04:39 | User Profile
[QUOTE=Quantrill]I would say Wal-mart's greatest crime is the means by which they have achieved that success.
There is nothing Walmart does that the competition isn't trying any less hard to do. Other companies are far more "criminal" than Walmart. For example, one of the many "crimes" of Microsoft was to force PC computer builders to buy a copy of Windows for every PC sold, even if the PC wasn't shipped with Windows. What has WalMart done to compare to that. Exxon bought Mobil. SBC bought ATT. These and other mergers instantly destroy competition without any competative effort. The market caps of companies like ExxonMobil, GE, and Microsoft leave Walmart in the dust. Is Walmart buying up the competition?
Walmart is trying to get lower prices from suppliers. All companies do that. And, I doubt any big company cares any more than WalMart about who they buy their goods from. Finding made-in-America" at Toys R Us is like searching for Waldo. What's made-in-America at Target or KMart?
Have you ever worked for a mom and pop business? Even pre-Walmart (not that I was around then)? They pay near minimum wage and offer no benefits (unless you're a family member). It's better to work for Walmart.
What's the point of unionizing Walmart? So the casher can make a little extra money, with the union skimming off of that? How does that help me? I might be needing a job but can't get one at Walmart because the low-skilled employees won't leave their cash cow jobs when they would otherwise be moving on to better things.
Unions have already played a big role in destroying America's manufacturing sector. If they can sink their teeth into Walmart, they'll just destroy local jobs as more people order their goods over the Internet. And, for the people not working at Walmart, it'll be harder for these people to make ends meet because they have to pay higher prices.
Part of Walmart's success is that they're more competent and less obnoxious than the competition. For example, every time I go to KMart, I regret it. I have gone a few times just to avoid Walmart, and I regret it. It's bad enough that KMart's advertising pushes me away (dykes and Marth Stewart don't exactly appeal to me). I went for a safety inspection, but their garage doesn't provide that. Fine. KMart specializes in the Kitchen supplies and other househould things. I went for large drinking tumblers, but didn't find an. I went for a hamburger patty maker, but they didn't have any. Things should should have, they don't. But, they do have a buch of different brands of rolling pins and egg timers.
I bought a DVD player at Walmart, after looking at both Best Buy and Circuit City. All I wanted was a DVD player that could play MPEG4 and SVCDs. The electronic stores had a big brand selection of the same unacceptable (Asian-made) DVD players. Walmart carried only a few models yet had exactly what I was looking for. And, at Walmart, the DVD player was cheaper than most of the DVD players sold at the electronics stores. And, I was spared being accosted ignorant (no insult to them intended) sales people who were unfamiliar with MPEG4 and SVCDs, but whom I would have paid extra money to support their commissions.
There are problems. Walmart may eventually good so big that they actually hurt the consumer (as Microsoft and other companies alread do). But, this is not the fault of Walmart, but of the governmetn that creates laws designed to promote growth of the biggest international companies at the expense of smaller, domestic companies. Monopolies and oligopolies are created by the government, not the Free Market.
2005-02-21 14:51 | User Profile
[QUOTE=Happy Hacker] There are problems. Walmart may eventually good so big that they actually hurt the consumer (as Microsoft and other companies alread do). But, this is not the fault of Walmart, but of the governmetn that creates laws designed to promote growth of the biggest international companies at the expense of smaller, domestic companies. Wal-mart already hurts consumers by destroying the American manufacturing base. They are basically borrowing against the future health of the economy for profit in the present. What use are cheap Chinese goods when there aren't any Americans left with jobs to buy them?
[quote=Happy Hacker]Monopolies and oligopolies are created by the government, not the Free Market.[/QUOTE] I disagree. Oligopolies and monopolies are created by the free market itself, and government can either encourage or discourage that outcome.
2005-02-21 15:09 | User Profile
[QUOTE=Quantrill] I disagree. Oligopolies and monopolies are created by the free market itself, and government can either encourage or discourage that outcome.[/QUOTE]
We encourage the creation of an oliogopoly in a number of ways that are designed to distort the free market.
These include a wholly imaginary currency, artificially set interest rates, and routine use of the corporate organizational form.
We who stand against these things are the real defenders of Adam Smith, and not the Forbes of the world.
2005-02-21 15:15 | User Profile
[QUOTE=Happy Hacker]There is nothing Walmart does that the competition isn't trying any less hard to do. Other companies are far more "criminal" than Walmart. [/QUOTE]
The problem with Wal-Mart is that they're so big they can externalize their costs, including social capital.
The problem with modern economics is that it ignores social capital because it finds it so difficult to quantify. Economists are bean counters, after all. If they can't count it, then it just doesn't exist for them. But that's obviously crazy to anybody who's not an economist. Just because you can't measure it doesn't mean it doesn't exist, or that it's not important.
Wal-Mart depends for its very existence on a stable American society. If it then undermines American jobs through it's aggressive importing of cheap goods made from Chinese slave labor and pays its workers so little they qualify for food stamps, then it's pretty clear Wal-Mart isn't internalizing its real costs.
Adam Smith and others recognized the fact that a free market adheres in a stable and basically moral society. Wal-Mart wraps itself in free market rhetoric, and then proceeds to externalize its social capital costs.
Walter
2005-02-21 15:26 | User Profile
[QUOTE=Walter Yannis]We encourage the creation of an oliogopoly in a number of ways that are designed to distort the free market.
These include a wholly imaginary currency, artificially set interest rates, and routine use of the corporate organizational form.
We who stand against these things are the real defenders of Adam Smith, and not the Forbes of the world.[/QUOTE] Walter, I agree with you that the government currently encourages oligopoly in many ways. However, it doesn't have to be that way. Chesterton gave as his rule of thumb for government economic policy -- 'Always favor the small.' I am becoming increasingly convinced that the free market itself, not just distortions of it, will lead to oligopoly in an industrialized society. The government's role is to prevent this, and to thereby encourage more perfect competition, by keeping firms from externalizing their true costs.
The libertarian dogma -- that the unfettered free market will always produce the best possible outcome -- just doesn't wash with me any more.
2005-02-21 16:54 | User Profile
[QUOTE=Quantrill]Chesterton gave as his rule of thumb for government economic policy -- 'Always favor the small.' [/QUOTE] I would change that to "always favor active investors over passive ones."
As the Popes have pointed out, the great rift in modern times is between capital and labor. Active investing unites capital and labor, and builds social capital.
Great businessmen like Henry Ford and Sam Walton are an overall benefit to the commonweal. We need to encourage people like them who ACTIVELY build businesses, both great and small.
We need to discourage (but not ban) passive investing, where faceless stockholders hold stock in huge conglomerates run by hired managers, with neither the stockholders nor the managers ultimately responsible for anything, thereby destroying social capital.
It is the corporate form that makes massive, social-capital-destroying passive investing possible. If Wal-Mart were organized as a general partnership, then even though Sam Walton's genius would have ensured it's becoming a behemouth, the danger to the small guy would be limited to the amount of money lenders would lend him, and the thing would have stopped with his death. But the corporation allows millions of investors to kick in some money, take no responsibility for the company's management, and take no risk for the company's actions beyond the value of their investment, and then allows the thing to continue on forever. It's a bad, bad deal for society.
Getting rid of the corporate organizational form, at least for routine business uses (I can imagine a legitimate use of the corporate form for, say, the TVA) and you will have taken a big step toward re-uniting labor with capital.