Thoughts about Extremism and Wal-Mart

Extremism and Wal-Mart

© David Burton 2005

I was struck by a story that I recently read about 10 year old students protesting against Wal-Mart (Ref. 1). It reported that a group of fifth-graders from the Workingmen’s Circle Jewish school in Brookline, Massachusetts gathered at the entrance to the Wal-Mart store in a Framingham mall “to protest the labor practices of the world’s largest company. The students chanted, held signs and sang songs.” The article continued by saying that the 10 year old students then “gave speeches to the crowd in the parking lot.”

Bill Wertz, a spokesman for the Wal-Mart Corporation in Bentonville, Arkansas responded by stating that “the charges against the company were familiar and inaccurate.”

Workingmen’s Circle director, Lisa Gallatin, stated that, “You would be amazed at how smart and sophisticated these 10 year olds are at understanding the injustice being done in both this society and overseas.”

First, let me state that I am neither a fervent opponent nor an ardent supporter of Wal-Mart. Neither my wife nor I are their greatest customers, shopping at Wal-Mart only infrequently. Having said all that, let me make some observations and pose a few questions. First, I wonder if these “smart and sophisticated 10 year olds” were presented with all the facts. Were they told that Wal-Mart is by no means the only company in America that sells products made in China? Were they told that many lower income families in America shop at Wal-Mart because Wal-Mart’s low prices enable them to buy items such as clothes that they might otherwise not be able to afford? Were they told that Wal-Mart employs thousands of people that might otherwise be unemployed? Were they told of the services that Wal-Mart provides to the communities in which they do business or that Wal-Mart was a significant contributor to hurricane Katrina relief? Were these 10 olds given all this information or were they simply brainwashed by another group of extremists with an agenda?

From my point of view, using 10 year olds for public relation purposes is immoral. Implying that these “smart and sophisticated 10 year olds” were given all the facts and were smart and sophisticated enough to unanimously come to the conclusion on their own that they needed to go to a Wal-Mart store and protest is highly disingenuous at the least. I suspect that the fifth-graders from the Workingmen’s Circle Jewish school in Brookline are being duped and used.

It’s easy to make a one-sided attack on anyone or anything. It’s much more difficult to consider all sides of an issue. It’s easy to ignore the law of unintended consequences. For example, environmentalists lobbied hard and long to force electric energy producers to switch from coal and oil to natural gas; others have fought against building new natural gas pipelines and liquefied natural gas (LNG) terminals; still others have opposed the exploration for oil and gas in the Arctic National Wildlife Refuge (ANWR) in Alaska or off the coast of New England. Unintended consequences of these actions are the short supply of natural gas this winter and the much higher cost of energy in general.

Before potentially killing the goose that is laying the golden egg, unbiased people interested in all the facts, their implications and their consequences need to hear from all sides and make up their own minds. Blindly accepting and following the positions of either end of the spectrum is not a smart move.

Consider the following statements, pro and con, concerning Wal-Mart. More propaganda (or facts, depending upon your point of view) is available at the web sites referenced below as well as several others not referenced.

Pro (Ref. 2 and 3):

In 2005, Wal-Mart will donate more than $200 million to help charities and organizations throughout the U.S.
The typical Wal-Mart Supercenter raises or gives $30,000 to $50,000 a year to local charitable needs ranging from youth programs to literacy councils. Wal-Mart is the largest corporate cash contributor in America.
Wal-Mart offers affordable health care coverage to both its full and part-time associates. Wal-Mart has paid about two-thirds of the cost of the Associates' Medical Plan. As of today, 620,000 associates have signed up for health insurance coverage in a Wal-Mart sponsored plan. In January, Wal-Mart will provide insurance to more than 1 million people and offer up to 18 different plans.
In recent years, Wal-Mart has contributed 4 percent of an associate's eligible pay to the combined Profit Sharing & 401(k) plan. In FYE 2005, Wal-Mart spent $4.2 billion on benefits for its associates.
In 2004, Wal-Mart collected more than $11.2 billion in state and local sales taxes and paid millions in property taxes.
A UBS Warburg study found that Wal-Mart grocery prices are 17 to 20 percent lower than other supermarkets, which has the greatest benefit for a community’s low-income families. A recent independent economic study by Global Insight, Inc. showed Wal-Mart saved working families over $2,300 per household, per year.
A study by Dr. Emek Basker at the University of Missouri, showed average increases of 50 retail jobs in communities five years after the entry of Wal-Mart.
1.3 million Associates work at Wal-Mart in the U.S. The majority of Wal-Mart's hourly store associates in the U.S. work full-time. That's well above the 20 - 40 percent typically found in the retail industry. Wal-Mart is a leading employer of Hispanic Americans, with more than 139,000 Hispanic associates. Wal-Mart is one of the leading employers of African Americans, with more than 208,000 African-American associates. More than 220,000 of its associates are 55 or older. It employ more than 775,000 women. Wal-Mart’s average hourly wage for regular full-time associates in the U.S. is $9.68 an hour, almost double the federal minimum wage.
Wal-Mart buys merchandise and services from more than 61,000 U.S suppliers and supports over 3 million supplier jobs in the United States. Last year, Wal-Mart purchased over $150 billion in goods from its 61,000 U.S. suppliers. Many Wal-Mart Stores participate in its “Store of the Community,” which showcases local products from local producers.
Wal-Mart sources from the global market to offer our customers who live paycheck to paycheck the greatest value for their money on many essential products
Wal-Mart utilizes a Factory Certification Program to make a difference in the quality of life for workers, their families and communities.

Con (Ref. 4, 5 and 6):

Wal-Mart cost American taxpayers over $1.5 billion in 2004 for the healthcare, childcare and housing assistance for countless Wal-Mart employees.

70 percent of the things sold in Wal-Mart stores have a Chinese component to them.

Wal-Mart now directly saves American consumers $20 billion a year by one estimate -- and probably several times that sum once the indirect effect on competitors is factored in, but Wal-Mart's business suppliers have been forced to close U.S. factories and source overseas, with millions of American jobs lost in the process.

Of all Wal-Mart’s private label apparel, only 17% is made in the U.S.

To manufacture a Wal-Mart shirt, young women in Bangladesh are forced to work from 7:30 a.m. to 8:00 p.m., seven days a week, paid just 9 cents to 20 cents an hour, are denied health care and maternity leave; screamed at to work faster; with monitored bathroom visits; and will be fired for daring to complain or ask for their rights.

Wal-Mart applies relentless pressure to its suppliers in order to drive down prices

Wal-Mart is helping accelerate the loss of American jobs to low-wage countries such as China.

Wal-Mart has also lulled shoppers into ignoring the difference between the price of something and the cost. Ever-cheaper prices have consequences - consumers want clean air, clean water, good living conditions, the best health care in the world and yet they aren't willing to pay for anything manufactured under those restrictions.

For a more neutral perspective, consider checking out the PBS Frontline report on Wal-Mart (Ref. 7). In any event, we don’t live in a black and white world - its grey, so try to get as many of the facts as possible, digest them, and then reach your own conclusions. Who are the good guys and who are the bad guys here? Probably, there's a little of both in both sides. Don’t let yourself be led around by the nose - you decide for yourself.

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References:

Wal-Mart protest led by Jewish students in suburbs, Ted Siefer, The Jewish Pres, December 16, 2005, Pg. 2.

http://www.walmartfacts.com

http://www.walmartstores.com

http://walmartwatch.com

http://www.1worldcommunication.org

http://www.fastcompany.com/magazine/77/walmart.html

http://www.pbs.org/wgbh/pages/frontline/shows/walmart

16 December 2005 {Article 11; Undecided_02}

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