The implications of Stern's crusade stretch well beyond the narrow world of organized labor and into the heart of the nation's politics. The stale and paralyzed political dialogue in Washington right now is a direct result of the deterioration of industrial America, followed by the rise of the Wal-Mart economy.[Snip]
Even if big labor eventually does come to be made up of bigger unions, Stern sees a larger challenge: can you build a multinational labor movement to counter the leverage of multinational giants whose tentacles reach across oceans and continents? The emblem of this new kind of behemoth, of course, is Wal-Mart, the nation's largest employer. Wal-Mart has, in a sense, turned the American retail model inside out. It used to be that a manufacturer made, say, a clock radio, determined its price and the wages of the employees who made it and then sold the radio to a retail outlet at a profit. Wal-Mart's power is such that the process now works in reverse: in practice, Wal-Mart sets the price for that clock radio, and the manufacturer, very likely located overseas, figures out how low wages will have to be in order to make it profitable to produce it. In this way, Wal-Mart not only resists unions in its stores with unwavering ferocity but also drives down the wages of its manufacturers -- all in the service of bringing consumers the lowest possible price.
''What was good for G.M. ended up being good for the country,'' Stern says. ''What's good for Wal-Mart ends up being good for five families'' -- the heirs to the Walton fortune. Stern's reform plan for the A.F.L.-C.I.O. includes a $25 million fund to organize Wal-Mart's workers. But as a retail outlet, Wal-Mart doesn't really fall within the S.E.I.U.'s purview. What Stern says he is deeply worried about is what he sees as the next generation of Wal-Marts, which are on his turf: French, British and Scandinavian companies whose entry into the American market threatens to drive down wages in service industries, which are often less visible than retail. ''While we were invading Iraq, the Europeans invaded us,'' Stern says. Most of these companies have no objection to unionizing in Europe, where organized labor is the norm. But when they come to the United States, they immediately follow the Wal-Mart model, undercutting their competitors by shutting out unions and squeezing paychecks.