What's worrisome about Wal-Mart is that, like GM and Ford once did, they are setting the norms for the coming (or current?) economy. One in every five retail sales is done at their cash registers; they're larger than the next five retailers combined. Indeed, for major producers, Wal-Mart is just about the only market that matters, which allows them to dictate the production methods, employee relations, and business strategies all the way up the food chain. In action and effect, Wal-Mart is an active monopsony -- a seller able to dictate the price to its producers. They've forced Coke to change their secret recipe, Kraft to lay off thousands of employees, and Vlasic to declare bankruptcy. And because Wal-Mart so obsessively pursues the lowest possible prices, they're not only depriving their own workers of generous benefits and compensation, they're making it literally impossible for their producers to do so, as Wal-Mart won't abide by the minor cost differences that on-shore production and respectable benefits demand.Unfortunately, kinda like the Iraq War, the attitude seems to be "let the other guy worry about it."
Friday, August 25, 2006
Shopping at Wal-Mart - Is it good for our country?
Thanks to Jonathan at Writing on the Wal for putting me on to these comments by Ezra Kline.