[Paleopsych] NYT Op-Ed: Don't Blame Wal-Mart
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Sat Apr 16 22:04:44 UTC 2005
Don't Blame Wal-Mart
February 28, 2005
By ROBERT B. REICH
Berkeley, Calif. -- BOWING to intense pressure from neighborhood and
labor groups, a real estate developer has just given up plans to
include a Wal-Mart store in a mall in Queens, thereby blocking
Wal-Mart's plan to open its first store in New York City. In the eyes
of Wal-Mart's detractors, the Arkansas-based chain embodies the worst
kind of economic exploitation: it pays its 1.2 million American
workers an average of only $9.68 an hour, doesn't provide most of them
with health insurance, keeps out unions, has a checkered history on
labor law and turns main streets into ghost towns by sucking business
away from small retailers.
But isn't Wal-Mart really being punished for our sins? After all, it's
not as if Wal-Mart's founder, Sam Walton, and his successors created
the world's largest retailer by putting a gun to our heads and forcing
us to shop there.
Instead, Wal-Mart has lured customers with low prices. "We expect our
suppliers to drive the costs out of the supply chain," a spokeswoman
for Wal-Mart said. "It's good for us and good for them."
Wal-Mart may have perfected this technique, but you can find it almost
everywhere these days. Corporations are in fierce competition to get
and keep customers, so they pass the bulk of their cost cuts through
to consumers as lower prices. Products are manufactured in China at a
fraction of the cost of making them here, and American consumers get
great deals. Back-office work, along with computer programming and
data crunching, is "offshored" to India, so our dollars go even
Meanwhile, many of us pressure companies to give us even better
bargains. I look on the Internet to find the lowest price I can and
buy airline tickets, books, merchandise from just about anywhere with
a click of a mouse. Don't you?
The fact is, today's economy offers us a Faustian bargain: it can give
consumers deals largely because it hammers workers and communities.
We can blame big corporations, but we're mostly making this bargain
with ourselves. The easier it is for us to get great deals, the
stronger the downward pressure on wages and benefits. Last year, the
real wages of hourly workers, who make up about 80 percent of the work
force, actually dropped for the first time in more than a decade;
hourly workers' health and pension benefits are in free fall. The
easier it is for us to find better professional services, the harder
professionals have to hustle to attract and keep clients. The more
efficiently we can summon products from anywhere on the globe, the
more stress we put on our own communities.
But you and I aren't just consumers. We're also workers and citizens.
How do we strike the right balance? To claim that people shouldn't
have access to Wal-Mart or to cut-rate airfares or services from India
or to Internet shopping, because these somehow reduce their quality of
life, is paternalistic tripe. No one is a better judge of what people
want than they themselves.
The problem is, the choices we make in the market don't fully reflect
our values as workers or as citizens. I didn't want our community
bookstore in Cambridge, Mass., to close (as it did last fall) yet I
still bought lots of books from Amazon.com. In addition, we may not
see the larger bargain when our own job or community isn't directly at
stake. I don't like what's happening to airline workers, but I still
try for the cheapest fare I can get.
The only way for the workers or citizens in us to trump the consumers
in us is through laws and regulations that make our purchases a social
choice as well as a personal one. A requirement that companies with
more than 50 employees offer their workers affordable health
insurance, for example, might increase slightly the price of their
goods and services. My inner consumer won't like that very much, but
the worker in me thinks it a fair price to pay. Same with an increase
in the minimum wage or a change in labor laws making it easier for
employees to organize and negotiate better terms.
I wouldn't go so far as to re-regulate the airline industry or hobble
free trade with China and India - that would cost me as a consumer far
too much - but I'd like the government to offer wage insurance to ease
the pain of sudden losses of pay. And I'd support labor standards that
make trade agreements a bit more fair.
These provisions might end up costing me some money, but the citizen
in me thinks they are worth the price. You might think differently,
but as a nation we aren't even having this sort of discussion.
Instead, our debates about economic change take place between two
warring camps: those who want the best consumer deals, and those who
want to preserve jobs and communities much as they are. Instead of
finding ways to soften the blows, compensate the losers or slow the
pace of change - so the consumers in us can enjoy lower prices and
better products without wreaking too much damage on us in our role as
workers and citizens - we go to battle.
I don't know if Wal-Mart will ever make it into New York City. I do
know that New Yorkers, like most other Americans, want the great deals
that can be had in a rapidly globalizing high-tech economy. Yet the
prices on sales tags don't reflect the full prices we have to pay as
workers and citizens. A sensible public debate would focus on how to
make that total price as low as possible.
Robert B. Reich, the author of "Reason: Why Liberals Will Win the
Battle for America," was secretary of labor from 1993 to 1997.
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