Tuesday, June 27, 2006

Good Wal-Mart Debate at Slate

Barbara Ehrenreich, ex-Wal-Mart employee, author of Nickle and Dimed a story about how she lived a low wage earners life debates economist Jason Furman, author of Wal-Mart: A progressive success story.

Barbara makes some good points:

And it is because we appreciate the low prices that we are not yelling: Stamp out the Beast! Crush it before it can bud off yet another Super Store!We are saying, pretty calmly for the most part: Why can't it be better? Why can't it offer decent-paying jobs as well as low prices, especially if it's such a genius, as you say, at increasing productivity?

The problem isn't Wal-Mart, we critics like to say, it's the Wal-Martization of the entire economy, which involves not only low wages at Wal-Mart itself but depressed wages throughout the company's whole supply chain as well as at competing companies (e.g., supermarkets).

Jason counters:
Maybe you're ready to grant my point that Wal-Mart's low prices are great for the 298 million Americans who don't work there. But what about the 1.3 million Americans who do work for Wal-Mart? Here the evidence is murkier, in part because Wal-Mart refuses to release the data on its wages and benefits that could clear up a number of questions. What we do know is that its wages and benefits are about average for the retail sector—which is to say, not so great.

But I understand why progressives are so upset about low wages and inadequate benefits. I am also upset by the rise of inequality and the relatively slow economic progress that the bottom 80 percent of Americans have made over the last several decades. I just think Wal-Mart is the wrong place to put the blame or to expect the solution.

Now imagine that Best Buys across the country were replaced by Stereo Exchanges. We would have more "good jobs" and fewer "bad jobs." The average wage in the electronics retail sector would go up. But where would all the former Best Buy workers go? Most of them wouldn't work at Stereo Exchange. Maybe some would take a pay cut and work at McDonalds.
Sounds like he is saying big box stores are there to provide jobs to dummies.

I'm a little baffled by your Best Buy/Stereo Exchange example. If Stereo Exchange took over from Best Buy, there'd be a lot more better-paying jobs in the retail electronics business. Why wouldn't the former Best Buy workers take a lot of these new and better jobs? They're not all as clueless as you seem to think.

You ask, in so many words, why pick on Wal-Mart when there are so many equally Scrooge-like employers around? Why not go after, say, the bodega on the corner? Well, the question answers itself. By gobbling up thousands of acres of farmland and suburban sprawl to feed its relentless appetite for growth, recruiting (and spitting out) thousands of workers a day, and achieving near-monopoly status in some parts of the country, Wal-Mart has made itself into an unmissable target for anyone concerned about poverty and mounting inequality. The bodega may be bad—not to mention any number of retail chains other than Wal-Mart—but you might as well start with the biggest piggy of all, which is the largest single private employer in America.
Why can't more people understand this point?
You're arguing, essentially, that whatever misery Wal-Mart workers endure is compensated for by the low prices Wal-Mart consumers enjoy. The same could be said of other workers who provide services to working-class people, like those in the fast-food and child-care industries: Their atrocious wages help keep prices low for impecunious parents and burger-eaters. In other words, the working class can only advance on the backs of (some of) its own members. Sacrifice one group to keep the others afloat, so that the class struggle is replaced by a kind of Darwinism internal to the working class.

I believe this debate goes on all week.

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