November 28, 2005

Wal-Mart - The Evil Empire?

Interesting column in the Washington Post on Wal-Mart:

There's a comic side to the anti-Wal-Mart campaign brewing in Maryland and across the country. Only by summoning up the most naive view of corporate behavior can the critics be shocked -- shocked! -- by the giant retailer's machinations. Wal-Mart is plotting to contain health costs! But isn't that what every company does in the face of medical inflation? Wal-Mart has a war room to defend its image! Well, yeah, it's up against a hostile campaign featuring billboards, newspaper ads and a critical documentary movie. Wal-Mart aims to enrich shareholders and put rivals out of business! Hello? What business doesn't do that?

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....Companies like Wal-Mart are not run by saints. They can treat workers and competitors roughly. They may be poor stewards of the environment. When they break the law they must be punished. Wal-Mart is at the center of the globalized, technology-driven economy that's radically increased American inequality, so it's not surprising that it has critics. But globalization and business innovation are nonetheless the engines of progress; and if that sounds too abstract, think of the $200 billion-plus that Wal-Mart consumers gain annually. If critics prevent the firm from opening new branches, they will prevent ordinary families from sharing in those gains. Poor Americans will be chief among the casualties.

Good column. Read it all.

Critics of Wal-Mart typically lament the introduction of the "Big Box" stores into small communities. Yet, how often do you hear this charge when the company constructing the Big Box superstore is a Best Buy, Target, Compusave, etc.
Much of the anti-Wal-Mart hysteria has come from the unions. In fact, the unions typically finance a large portion of the anti-Wal-Mart campaigns in local communities across the country. This is likely a fact that most Americans don't understand or appreciate.
The unions have every right to fight Wal-Mart coming into their respective communities. After all, a non-union store means less opportunities for their members. Yet, let's at least be honest about where much of the opposition and financing of such opposition is coming from.
This being said, I personally believe that Wal-Mart should have the right to build its stores. Competition is a good thing ... Capitalism demands it.
Why not have documentaries and studies done on the affect of unions on America's productivity, the increased cost of doing business with union employees, union intimidation, decreased employment opportunities due to high cost of hiring more employees in union shops and how unions have forced some companies out of business? If it is fair to look at the social cost of Wal-Marts, why not look at the social cost of unions as well?

At the end of the day, the most ironical thing is that many of the people who decry the construction of Wal-Mart stores have no problem shopping there once the stores are constructed.
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