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They go into these places, promising jobs and reasonable prices, and they get all kinds of tax breaks. While they're open, the smaller businesses die off. When the tax breaks expire, they just abandon the towns.
A family member of a friend of mine is a Republican Mayor of just such a town and he's been fighting tooth and nail to keep Wal-mart out. He lost. Local stores are laying people off before the damned Wal-mart is even open. Maybe we can eventually make language a complete impediment to understanding. -Hobbes
BTW, I should note (on the salmon theme) that the fodder source for many of these fish farms is ocean-caught fish, i.e. the product of the indiscriminate slaughter conducted by factory trawlers. Farmed salmon does not necessarily alleviate the pressure on wild species; the wild species, regardless of size, age, or rarity, are "harvested" (stripmined or clearcut would be a more accurate term) to make food for the factory fish.
Also the salmon farming industry is one juicy target for the gene vandals; the "invention" of mutant faster-growing salmon was originally for factory farming purposes (to accelerate the life cycle of the fish and reduce the time from spawn to marketable meat). Of course these mutant fish are not going to stay neatly confined in the coastal farms, and in the wild they will compete successfully and outbreed indigenous salmon varieties, or other native fish species.
It's worth remembering that the fish species we like to eat are almost all top predators in their marine or river niches. Eating them as a staple food is like eating lion, or bear, or wolverine as a staple food. They are relatively rare and play a key role in functioning food chains. Their elimination or reduction to pathetic levels has enormous destabilising impact because of their predator role...
At the same time, human activity is chopping and chipping away at the very bottom of the ocean food chain, (1) by global warming which threatens plankton populations worldwide in warming waters, (2) by nitrate and pollutant runoff which creates enormous dead zones off many industrialised coasts, and (2b) by antibiotic and estrogen-mimicking compounds which interfere with disease resistance and with reproduction of marine species (3) by incredibly destructive bottom-dragging nets which literally scrape all life off the seabed in a wide swathe, destroying hundreds or thousands of species to get at a few valuable "catch" species (a kind of "collective punishment" applied to hunting, like fishing with dynamite).
It is sheer vandalism, and all so that proletarians in the wealthy countries can emulate the diet of aristocrats of a generation or two generation ago... The difference between theory and practise in practise ...
As to Walmart in Germany, here is what the Economist writes:
"In Germany, Wal-Mart ended up with egg on its face. Even Mr Scott has admitted that the company's arrival was "somewhat embarrassing", although the situation is improving. Wal-Mart entered Germany, the third-biggest retail market after America and Japan, in 1997-98 by buying two local retail chains, Wertkauf and Interspar, for $1.6 billion. Whereas Wertkauf was well-known and profitable, Interspar was weak and operated mostly run-down stores. Wal-Mart has lost money in Germany ever since. Problems have included price controls, which prevent below-cost selling, rigid labour laws and tough zoning regulations, which make it extremely difficult to build big stores.
Wal-Mart also faced well-established rivals in Germany, like Metro, and hard discounters such as Aldi and Lidl, already comfortable with razor-thin profit margins. Many retailers in Germany are owned by wealthy families whose business priorities are not always the maximisation of shareholder value.
But there was more to it than that. Wal-Mart's entry was "nothing short of a fiasco", according to the authors of a study at the University of Bremen. At first, Wal-Mart's expatriate managers suffered from a massive clash of cultures, which was not helped by their refusal to learn to speak German. The company has come to be seen as an unattractive one to work for, adds the study. In part this is because of relatively low pay and an ultra-frugal policy on managers' business expenses."
When Walmart first came to Germany they asked employers to attend morning staff meetings where they were supposed to hold hands and sing the 'Wally hymn'. It did not work, the employees wouldn't do it. They considered it Kindergarten paedogogics. And still worse: They were derided by their friends, who made jokes about them. The next desaster was the Wally staff guideline on sex at the workplace. The unions sued the company and won the case. It was largely reported by the press as a prudish AngloSaxon attempt to de-humanise and illegally control inter personal staff relations at the workplace.
Moreover Walmart is seen by the public as selling cheap imported crap of low quality. They have not managed to compete with Aldi and Lidl, which also sell cheap stuff but which is considered of top quality.
I was curious enough to drive to one of the few German Walmart stores last summer. It looked very 'Russian' to me. I found that the hyper-market had the atmosphere of a soviet style supermarkt as I had seen it in East Berlin on Alexanderplatz before German re-unification. Huge piles of worthless cheap crap. It would have sold in Prague and Bucarest until five years ago. Since then people have ever more become acustomed to the West European aesthetic standard of product displays, which is less chaotic and more eye catching than the Walmart display.
Product display at Centrum supermarkt Berlin/DDR
"The USA appears destined by fate to plague America with misery in the name of liberty." Simon Bolivar, Caracas, 1819
You see the same thing in Michigan's old auto towns, like Flint (home of Michael Moore and the subject of his movie, Roger & Me, which I highly recommend). Flint was once a perfect example of middle-class, suburban, blue-collar America. Today, it has one of the highest murder rates in the country, and its fall began when GM pulled its Buick plant out in the late-1980s. The city had no other economic activity.
The problem is deeper than Wal-Mart. Wal-Mart is simply a chain of stores that sells cheap shit. What's happening in small-town America goes well beyond any damage Wal-Mart might cause. Mom & Pop businesses die when Wal-Mart comes to town because consumers choose low prices and brand names. Now we can say this is monopolistic, in practice. But it's really not, when you consider the outcome. Wal-Mart is simply able to beat the other companies' prices, which is what is supposed to happen. If Wal-Mart attempted to set prices too high, the low barriers to entry, coupled with innovation, would allow other firms to move in (as they will).
It's one thing to call everything out as being the fault of Wal-Mart. I don't even shop at that store, because it's impossible to walk through the aisles due to the high concentration of overweight hicks and their obnoxious children who have a tendency to run shopping carts into the back in my ankle. (It also doesn't carry my beer of choice, and the meat selection is just pathetic compared with Publix.) But I don't blame Wal-Mart for these issues. Wal-Mart is a company, and companies are best viewed as machines rather than living beings (in other words, stick to the positive over the normative -- it is what it is). The real question to ask is, What are we going to do about it? Are we going to regulate the shit out of Wal-Mart? I think that would be a mistake. You'll only end up raising prices on poor people, and, frankly, they need lower prices whenever possible.
No, what we need to do is build on the educational base, and expand it (that includes adult education and training). We also need to rebuild infrastructure, because, at least in America, infrastructure spending has been woefully inadequate for thirty years, and counting. It's time to stop playing short-run games with long-run issues. Instead of criticizing a system that generally works well, we should be seeking to build and improve upon it. Be nice to America. Or we'll bring democracy to your country.
Many of these small towns are crippled by economies that are not diversified.
No, what we need to do is build on the educational base, and expand it (that includes adult education and training). We also need to rebuild infrastructure, because, at least in America, infrastructure spending has been woefully inadequate for thirty years, and counting.
Services, as a practical matter, are also not moved very easily, in many cases. An Indian operator may be able to take over the job of Dell's customer service, but he can't put your money in the cash register at Wal-Mart, or sell you a phone at Nextel, or fix your iPod at the Apple store, or whatever else you may need. You can't, for example, outsource the work of a locksmith.
I don't see what you mean by a refutation of the Division of Labor and Comparative Advantage. Both are largely true, in my opinion. In many cases, the economic losses in these small towns are the result of the citizens having elected a state or local government made up of total fools. Rural states have skewed their policies, usually in favor of agriculture, and, today, they wonder why all they can produce is heavily-subsidized agriculture. (Gosh, that's just shocking, "in'nit"?) Hence why I've made it a habit to attack rural, Red-Staters as being the true "welfare queens" (to use Ronald Reagan's words), because they're completely dependent upon the tax dollars of urban, coastal cities (the Blue States, or the Blue areas of Red States). Be nice to America. Or we'll bring democracy to your country.
I could try to write a diary about this, but it would be exclusionary. A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
I never said the whole thing was Wal-mart's fault. Still if a mugger robs a poor guy of his rent money and the guy ends up homeless, do we give the mugger a pass because he's not responsible for the guy being in trouble in the first place?
You describe a lot of valid problems with small towns and the economy. No one's saying Wal-mart caused them nor that getting rid of Wal-mart would fix them.
Still, as I said before, they're capitalizing on the problem and making it worse. I called it economic strip-mining, DeAnander called it predation -- whatever you want to call it, it's a bad thing and they deserve as much criticism as we can dish out. They are part of the problem. They're making things worse and a pretty big scale. Maybe we can eventually make language a complete impediment to understanding. -Hobbes
So clearly just because the market is good at picking out the path of least resistance doesn't mean the market is best, or even good. A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
The only difference between them and the mugger is that they had the clout to get the laws changed to allow them to mug people. In that way, they're worse than the mugger -- he has no clout that would let him get his actions written into law.
Wal-mart can and does pull out of these small towns all the time -- it is strip-mining because they're capitalizing on the collapse. They hasten it by causing the surrounding businesses to close and taking whatever public funds they can get with them when they leave.
These things aren't just an unfortunate situation that Wal-mart finds itself in -- they count on the desperation as part of their business model. Maybe we can eventually make language a complete impediment to understanding. -Hobbes
What are the business practises that were illegal, that were changed and Walmart now benefits from?
Honest question, no spin. :-)
In general, full time workers received healthcare, pension, and other benefits, as well as certain protections regarding hiring and firing, and things like sick leave, maternity leave, and vacation time (remember that?).
There were regulations so businesses couldn't subvert the law by, say, hiring all their employees for 39 hours a week. There were also rules about who, why, and for how long someone could be hired as a temp or a sub-contractor. Remember when temps were actually, y'know, temporary workers? filling in for someone on vacation? And this doesn't even touch on outsourcing, etc.
Now it's just a free-for-all -- at least down here with the hoi polloi. It's not just Wal-mart, they're just one of the big guns. But it's basically been a class war, although if you point it out, people accuse you of instigating a class war. That's why it's taken so long to notice it if you aren't on the front lines.
If you seriously want to know about this, you have a lot of reading to do. I suggest you start with the congressional pdf report linked on this page. Here's a summary (bold is mine):
The report also provides a comprehensive review of Wal-Mart's numerous anti-worker practices, including union-busting activities, discrimination against women and disabled workers, violation of child and undocumented labor laws, unpaid overtime, and unsafe workplace policies, like locking workers into stores overnight. Wal-Mart has been the subject of thousands of lawsuits and critical media scrutiny on all of these issues. The Washington Post just reported on labor abuses in China at the hands of Wal-Mart.
Regarding sick time and maternity leave, I think these issues have been more state by state, but the laws have improved these benefits for employees. And on vacation time, there have been no laws taking away vacation time from the '70's, compared to now--and believe me, I do remember that.
You also mention a report that links to a "congressional report", which I reviewed. the congressional report is actually not a congressional report, it is a report by a particular democratic congressman that is replete with inaccuracies, and obviously pro-union to the point of distorting the facts. This article should be compared to the Walmart website to at least get both sides of the story.
I'm sorry if I used the term "congressional report" to describe a report from a congressman. Honestly, wchurchill, when you get in an argument, you make SWEEPING generalizations, false assertions, and then demand absolute proof and accuracy from everyone else.
I'm glad things are fine in your world. You're among the elite. If you have a genuine interest in finding out what the state of things is for the majority in this country -- do your own fucking research. The fact that Wal-mart workers get shitty treatment isn't really in dispute by anyone but assholes. I'm not going to argue about it. Maybe we can eventually make language a complete impediment to understanding. -Hobbes
This is ridiculous. Look at the four pages of fucking sources at the end of the report. Maybe we can eventually make language a complete impediment to understanding. -Hobbes
You're among the elite. If you have a genuine interest in finding out what the state of things is for the majority in this country -- do your own fucking research. The fact that Wal-mart workers get shitty treatment isn't really in dispute by anyone but assholes. I'm not going to argue about it. .....This is ridiculous. Look at the four pages of fucking sources at the end of the report.
You're right. I apologize. My remarks were over the top. But for some reason I find you particularly infuriating. That's not an excuse, just an explanation. And it's probably because you don't seem like a bad sort otherwise. If you really were just an asshole, I could ignore you quite easily.
That said, you should read some of the links in the sources of the pdf. To state that you don't think Wal-mart workers are unhappy when over half of them live below the poverty line, or to question whether their practices now would have been allowed 30 years ago seems... disingenuous at best.
Anyway, there's good reading in the sources. I'm browsing through the PBS one now. Maybe we can eventually make language a complete impediment to understanding. -Hobbes
Oh, but you did mention it! And it has nothing whatsoever to do with whether or not you're among the elite. From what you've said on this site, you've attended the whositz school of economics, you've travelled, you've been in charge of companies and hiring and firing people, you live in the Bay area, and you invest in the stock market.
None of these says anything about you as a person, but you're certainly in a privileged position, by your own telling of it. Still, it's your lack of understanding of how the lower half live that betrays you... <ducks and runs> Maybe we can eventually make language a complete impediment to understanding. -Hobbes
I often don't know where to start responding to some of your comments, because I have so many comments, but can't write all night, or take up all this space on ET.
First regarding your comments on me, and I don't want to say to much here, but you're basically right accept for the "lack of understanding of how the lower half live that betrays you". At least I pray that is true--the lack of understanding part. I guess over the course of writing on these blogs one might reveal more about oneself that intended. But you have recounted a part, and it is true. I've waited tables, worked retail (liquor stores), worked heavy factory work (great and needed money at the time--a teamster, btw), and many more jobs like that. Saved the money to go to school, undergrad and grad,,,worked my way up through business,,,jobs in Europe that were eyeopening (culturally and in business), and have finally,,,ended up, I guess, "elite" in a financial sense. But don't feel elite, because my friends, in addition to successful business friends, are friends like i've always had. I was pretty happy when I waited tables,,and i'm pretty happy now. For me, life is life--I take some pride in success,,but at the same time know others are more successful,,,and still others far better than I have achieved less financial success--often more core, spiritual success.
I only say that in response to your comments. I do know the lower end of the financial scale--the retail and the physical work. And actually it always helped me in business, because I admire people at all levels, truly. People seemed to see that, and share things with me, regardless of my position. (which is a huge advantage in senior positions in business--understanding the view from the production line, to the sales force to the customer). My friends I worked with on the production line were real people, just like my friends in offices later in life.
I say that to acknowledge that the comments you made, my retail life to my in charge of companies life to my life today, are in fact accurate.
I have a view as to why you and I, and many others like us, have such contrary views on Walmart. Walmart is a retail store, it competes in a retail market,,,,it should not be expected to pay a lot more than the average retail salaries and benefits. Their jobs should not be compared to jobs in other industries. They don't compete for employees with Intel, General Motors, Merck, etc.. They compete with a lot of Ma and Pa's, Target, Walgreens,. etc. And, in retail, lots of people want the part time jobs, the odd hours, etc. because it fits with the rest of their life--raising kids, a second job, going to school, or whatever. So I think if these studies that are made by the Congressman were made to Walmart's market for employees,, to its competitors, they would be the same or favorable. It's just a fact that retail jobs at the lowest levels (stocking, cash register) pay below the "American" poverty line. that's true now, and it was true 30 years ago. I would really like to see some employee satisfaction data from Walmart employees--my sense based on admittedly very small sample size, and some feedback from people who know people who work at Walmart, is those employees feel fairly treated.
Regarding Walmart's other competitive practises, I don't think I can add much more to what Drew has said above.
Do you personally know any Walmart employees, or know people that shop at Walmart? My limited experience on both fronts (granted, very limited) is they have happy customers, as well as employees who feel well treated. I guess the fact that they are the nation's largest retailer would substantiate the customer side. And where I live on the West Coast, the lines to get hired at a new Walmart near me would seem to attest to the employee side.
Anyway, apologies for the length of my comments,,,and maybe for infuriating you (but maybe not--this dialogue may be good for both of us). Thanks for making me laugh at your humour, and think about your comments.
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