Saturday, May 01, 2004

Wal-Mart in the desert; and a new SuperCenter 

Today's front-page news in the local paper is about the planned opening of a SuperCenter two years from now. The town is a small place out in the desert, 80 miles or so from the next nearest Wal-Mart or Target or other major department store. There is already a 100,000 sq ft Wal-Mart here, and it is one of the major economic/shopping centers of the town. It's where residents go for their basics other than groceries. (The town has a large Safeway, a Raley's, and, for those who work at the Naval Air Station, a Navy Commissary.) Pretty much, people are excited that they will have another choice and anticipate lower prices, which will please their families. The main negative thing I have heard so far is that it's further from the center of town, so the drive will be longer, and it may impact traffic going in and out of town. (It will be about two miles up the road from the current Wal-Mart, which will be replaced.) Right now, the town's Safeway benefits enormously from being right next to the Wal-Mart in the same strip mall. I imagine they are worried, though they have two years to decide what to do.

I've mentioned before, I hate shopping at Wal-Mart (you know, the clutter, the lighting, the sometimes-shoddy goods) but if I lived here full time, or in many places like it, it makes a huge difference to your quality of life that you can easily get the same variety of goods at the same prices as you'd get in other places. Contrast this with gas prices in this town, which are 10 or so cents higher than in Reno (which is itself a geographically isolated market for gasoline refiners). Most groceries here cost a slight bit more than back in Reno, and there is a smaller selection of things like produce, fresh meats, and fresh fish. I imagine that a SuperCenter, with Wal-Mart's tight supply chain and high turnover, would improve the freshness of such items they carry, but I wonder if they would at all increase the variety, or if they just wouldn't bother.

*Updated Yet Again*: Rutland City's Wal-Mart denies it is experiencing growing pains 

Rutland City, the second largest city located in Vermont, was surprised to learn that Wal-Mart was thinking of possibly either moving or expanding its downtown store, after a local WM official spoke of such at a recent
city Community Development Committee meeting Thursday.
later the exact same WM official
said her comments at the meeting represented her own opinions and not the official plans of Wal-Mart.

A spokeswoman from Wal-Mart corporate headquarters in Bentonville, Ark., confirmed that Wal-Mart has no plans to leave or expand at the plaza.

"We have no plans for a superstore and we're very happy at the location," said spokeswoman Mia Masten. "We're fine with the store and we have no plans to go anywhere."
read the entire article, published in the Rutland Herald: Wal-Mart insists store staying put.

*update #1*

as it relates to the above item in general terms, below is information which may be of interest to those whom are not yet aware of it.

Vermont's Act 250
Vermont pioneered a cooperative approach to large-scale development on a statewide level in 1970 with Act 250, which arose in response to the arrival of Vermont's first interstate highway in the late 1960s. Residents feared that the highway would lead to rapid, uncontrolled growth and ultimately the destruction of the state's rural character and picturesque towns.

Act 250 requires developments of regional impact to obtain a land use permit from the one of the state's District Environmental Commissions. In most cases, commercial developments require Act 250 review when they encompass ten or more acres of land, a threshold substantially higher than under Cape Cod's rules. Act 250 approval depends on meeting several conditions that focus on the project's environmental and economic impact. Decisions by the state's nine District Environmental Commissions may be appealed to the state Environmental Board and ultimately the Vermont Supreme Court. Members of both the district commissions and the state board are appointed by the governor.

In addition to the law's environmental criteria concerning water and air pollution, energy conservation, and soil erosion, Act 250 specifies that developments must not place unreasonable fiscal burdens on the ability of local governments to provide education and other services, must not exhaust the town's ability to accommodate growth, and must be consistent with local land use policies. Act 250 discourages scattered development by requiring a project to be contiguous to existing settlements unless the tax revenue generated by the development exceeds the additional cost of public services required by the project. Act 250 also considers a development's impact on scenic and historic sites.

Act 250 has limited the number of large-scale retailers in Vermont. The state was the last U.S. frontier for Wal-Mart, which built its first store there in 1995. Vermont now has four Wal-Mart stores, but as a result of Act 250, three of these are about half the size of a typical Wal-Mart and were located in existing buildings. In Bennington, Wal-Mart opened a 52,000 square foot store in a former Woolworth's building, and, in Rutland, a 75,000 square foot store was located downtown. Most recently, Wal-Mart opened a 66,000 square foot store in Berlin. The store occupies a building that previously housed another department store.


* Vermont's State Environmental Board

The New Rules Project

*update #2*

the fourth WM in Vermont, only generally mentioned above, is located in Williston.

Williston is part of Chittenden County, Vermont's most densely polpulated county and home to Burlington, the state's largest city.

what I found online indicates yet another new WM, this one 150,000 sq ft, may possibly be on the way into St. Albans., which is in addition to the four mentioned above.

lying just South of the Canadian border, St. Albans is located in the upper Northwestern part of the state, in Franklin County -- a northern neighbor to Chittenden County.

came across a January 2004 article article published in the St. Albans. Messenger about the new WM: City takes ring-side seat for Wal-Mart
Messenger Staff Writer

ST. ALBANS CITY -- As developers prepare to seek permits for a large Wal-Mart store in St. Albans Town, aldermen here have assigned the city manager to be involved in future discussions about the project.

On Jan. 12, the city council voted unanimously to appoint Brian Searles as the city's representative in future Wal-Mart conversations.

Mayor Peter DesLauriers said town officials were receptive to his request that the city be party to future talks about building a 150,000-square-foot Wal-Mart -- slated to be the largest in Vermont -- on U.S. 7-North, across from the Interstate 89 access road.


In late December, Gov. Jim Douglas joined project officials, lawmakers and business leaders in announcing Wal-Mart's intent to build a store on the same site originally proposed in the early 1990s.

The state environmental board rejected that first proposal, and the Vermont Supreme Court upheld its ruling, thus shutting down the mega-retailer's first bid for a Vermont store.

The new Wal-Mart would employ about 300 people -- more than 70 percent of them full-time -- and offer a vision center, pharmacy, snack bar, garden center and possibly a gas station. It will not sell groceries.

The building would be 35,000 square feet larger than the Williston Wal-Mart -- which cannot expand because of land constraints -- and sit about 1,000 feet off Route 7.

J.L. Davis is buying the 107.5-acre parcel from the St. Albans Group, a mix of local businessman and developers who owned the property since 1986. Wal-Mart will be J.L. Davis' tenant.

J.L. Davis wants to subdivide the land into three lots: 71 acres for Wal-Mart, a 10-acre plot and a 4 1/2-acre parcel.

Vermont's other Wal-Mart stores are in Bennington (51,000 square feet), Berlin (74,500 square feet) and Rutland (76,100 square feet).
read the entire article, here.

plus this recent follow-up article: The next Tafts Corner?
Wal-Mart, big boxers pose St. Albans boon and major challenges

Messenger Staff Writer

ST. ALBANS TOWN -- When St. Albans Town Administrator Dan Lindley took the job in 2002, little did he know he would be negotiating the kind of growth now foreseen.

Within the next two years, the northern growth center of the town could be transformed. Wal-Mart is seeking a permit to build a 150,000-square-foot "big box" store just north of Price Chopper, and a T.J. Maxx store is coming to the Highgate Plaza by this fall.

Now, there is a rumor that a Lowe's, or Home Depot may build a 150,000-square-foot "big box" on 40 acres south of the proposed Wal-Mart.

Also proposed within the growth center is expansion of Franklin Park West, and on the south side of town, a major addition to the St. Albans Town Industrial Park. There also are numerous housing developments planned, including a 40-unit project at Fairfax Road and Route 104.

Just since last fall, a Wendy's restaurant, and a Merchant's Bank branch opened on the access road to Price Chopper. A three- store retail building behind them is in the final stage of construction. A Blockbuster's and a locally owned clothing store are already planned there.

Across U.S. 7-North, within Franklin Park West, a new Peoples Trust Company multi-story building also opened this year.

In reaction to this kind of activity, the town is looking to hire a full-time planner to aid and negotiate the future of town development.

The image of St. Albans Town's north end becoming a version of the big box Mecca of Tafts Corners in Williston has some residents terrified; others welcome the growth with open arms.

read the entire follow-up article, here.

in addition, the Vermont Legislature has just recently made changes to Act 250.

information concerning this can be found at the following sources:

April 21, 2004
Rutland Herald - Barre-Montpelier Times Argus
Act 250 appeals process redrawn
By John Zicconi


MONTPELIER - House and Senate negotiators on Tuesday agreed for the first time in more than 30 years to make significant alterations to Act 250, the state's landmark environmental protection law.

The deal, which must still be ratified by the full House and Senate, dissolves both the Vermont Environmental Board and the Vermont Water Resources Board. All environmental permit appeals beginning next February will instead be heard by an expanded environmental court.

The change removes oversight of all Act 250 and water-related issues from the two citizen panels and for the first time places permit appeals before an environmental court judge. The move was one of the Douglas' administration's top priorities, and represents a significant victory for the Republican governor in an election year.

Permit reform was also a top priority for Vermont business leaders, who predict the new system will both streamline permit review and bring greater predictability to its appeals process.

"This certainly is a big moment," said Rep. William Johnson, R-Canaan, who headed the House negotiating team that pushed expand the environmental court. "This Legislature is going where no one has ever gone before. We altered Act 250 law for the first time in 30 years, and in doing so we preserved the cornerstones of our environmental laws and did our best to make sure all Vermonters can participate in the system."

Douglas predicted the new appeals system would help spawn critical economic growth.

read the entire article, here.

the actual legislation making these changes to Vermont's Act 250 is House Bill 175 (H.0175): this particular Web page includes this bill's legislative history with links to the same as well as, at the very bottom of the page, links to the bill as introduced, as passed by the House and, then later, the Senate proposal of amendment. currently the page lists the bill as: Awaiting Governor's Action (Governor Jim Douglas, Official Website). if and when the bill is signed into law, it will be assigned an Act number and, then, the page will also list a link to the bill as enacted, at the bottom of the page.

*note*: made mostly minor changes to original post for the purposes of clarity of presentation; also added additional related information as well as links, indicated by *update #1*; in fact, I just added some more in yet another update - twice over in short order, indicated by *update #2*; edited and added language of final paragraph for the purposes of clarification and readability only: last updated on Saturday, May 1, 2004 at 11:59 PM [EDT].

Canadian Union Rips WM 

WM representatives rarely speak at all about unions; when they do, they argue that unions are not desirable for WM employees, which is a debatable point.

Union representatives frequently speak about WM; when they do, they don't just argue that WM employees would be better off with a union--they insist that WM is an uncaring monster:
TORONTO, April 29 /CNW/ - The leader of the union spearheading the effort
to organize Wal-Mart workers in Canada has described the latest statements from a Wal-Mart Canada spokesperson as "a page out of George Orwell's novel 1984 and more proof that Wal-Mart is as dedicated to everyday, low ethics as
they are to low prices," according to Michael J. Fraser, the national director of UFCW Canada (United Food and Commercial Workers Canada).

Fraser was reacting to a newspaper report published earlier this week in which Wal-Mart Canada spokesperson Andrew Pelletier was quoted as saying "Wal-Mart is an exemplary company with respect to working conditions."

"It's nothing but Orwellian doublespeak. They take the truth and turn it inside out," charged Fraser....

"This company has no shame," says Fraser. "They exploit their own workers and at the same time have driven hundreds of thousands of manufacturing jobs overseas where their sweatshop suppliers pay their workers less than a dollar an hour. Do they consider those working conditions exemplary too?"
If your objective is to unionize WM, this type of talk may not be the best means to do so. This was not a news story, but a press release from the union itself. Why not add a few facts--like the difficulty that American manufacturers are having finding competent employees--along with the accusations of manufacturing mass job exodus from North America? Perhaps the reason manufacturing jobs are leaving is not WMs desire to impoverish the masses, but service industries' giving higher wages than manufacturers for the same level of competence...

Friday, April 30, 2004

*Updated*: New Co-Blogger Intro: Morgan W. Brown 

just came across ALP this morning, thanks to a blog post by Jonathon on his Grumpy "OLD" Man blog.

while browsing through the archive of previous ALP blog posts, I came across Kevin Brancato's Wednesday, April 14, 2004 post that asked readers of ALP if they were interested in blogging about WM? the post states that Always Low Prices is actively looking for cobloggers.

not being able to resist, I e-mailed Kevin about my interest in blogging on the ALP blog and, here I am. that was certainly quick and rather painless.

am a 48-year-old, divorced, white male, struggling writer and activist, whom happens to be living homeless in Montpelier, Vermont. an old news article, from 2000, concerning some of my activism is available for reading here.

for the benefit of those whom might be interested in knowing: have lived homeless off and on over the previous thirty years, yet have only been homeless for a certain portion of those years of course, not the entire thirty. usually it was more off than on and, then, happening here and there maybe for a week, a month or sometimes for a year or so. except for my latest experience, which has last since July of 1997, going on nearly seven years now.

have experienced homelessness in several of its forms: e.g., on the street, sometimes roaming around or even hitching the country in order to keep moving, tenting out or even sleeping in the woods without any protection whatsoever, sleeping in cars and sometimes in hallways, stayed at homeless shelters -- though I no longer an doing the shelter scene since 1991, couch surfing (i.e., doubling up with someone who invites me in for one or more overnights). you get the idea.

my first experience with homeless was when I was 17-years-old, which I wrote last year and is posted on the Valencia Community College Course in the Humanities Website, here.

this time around most of it time under a roof so-to-speak; i.e., couch surfing from place to place; though I may end up tenting out once again very soon.

*update #3*: for additional information, perspective and insight concerning these and related matters, please check out: An Eye Opening Homeless Experience in Montpelier, Vermont; The Homeless Guy and, Crystal Evans: the thoughts and opinions of a homeless girl [recently housed, Crystal is now formerly homeless].

my online access is mostly via public access computers.

while I do so somewhat reluctantly for various reasons, as certain Wal-Mart (WM) practices cause major struggles of conscience for me, the fact is that I do sometime shop at WM out of pure necessity; though I do not apologize for it either, nor do I actually feel guilty doing so. however, if I could afford to shop elsewhere, I would; but I cannot so easily afford that luxury like some people are able to.

*update #2*: for example, the sturdy tent, quality sleeping bag and many other -- new condition -- outdoor survival gear items I needed to acquire without really having enough money to do so, were only affordable for me at WM.

it was also much easier too boot, as most everything I needed was there; instead of being forced to shop around for them, whether in looking for the best deal available on the exact same type of item or due to a store not having everything on hand that was needed. this saved me precious energy as well as time, both of which were in short supply at the time too.

these items were bought about five or so years ago, I cannot remember when exactly, but I had nowhere to stay and had to sleep outdoors. this gear made it possible, or least better, for me to camp outdoors with, so I had someplace to sleep and live. these same items are at the ready at a place where some very kind and understanding friends of mine allow me to store them as well as some of my other stuff (clothes and the like), which I have access to anytime I need to get to them.

it seems to be a catch 22.

if I did not shop at WM, I would have to go without certain items that are actually needed for survival, including clothing items and footwear (or else going around either wearing badly ragged clothes and footwear or otherwise having to go around naked and barefoot); at least when I can manage to afford them -- which is not too afford, even at WM. yet if I shop at WM, I am going against some of my strong convictions and at what cost.

the fact is that many of the things I happen to buy at WM are the same exact things sold at some of the more local stores (if they are even available there at all), made at the very same off-shore low or no wage places WM gets them from, but the local stores hike up the prices for their lions share.

buying local is not always truly buying local of course. in addition, some of these local shops do not always practice being a good or generous neighbors in various ways either. in certain cases, some so-called locals do not always provide livable or even wages much above minimum wage and no health insurance either. so buying local does not translate into an improve locally, except for the snotty locals who think they are better than their local have not's.

do not get me wrong though, I am not defending WM, but am merely pointing out certain observations and hypocrisies by the merchant trade in general, whatever size they may be or where they may be located or where the money really goes. of course each of them has their set of pat excuse as to why they cannot do better by their workers or the community, etc. yet I do harbor deep concerns over WM's labor practices and have seen their impact hit home close by, hurting people I know and care about.

however, that said, I have had my own up close and personal experiences with some of these very same practices in the past before by others in the merchant and other trades or industry, long before I ever knew or heard anything about WM.

yes, I think WM needs to be taken to task for what they do and also be set as an example; but if people think what they are doing is wrong, it should be clearly and repeatedly pointed out that they are not alone in some of what they do that has such a bad impact on so many people and workers as well as their communities, who each and all end up paying the price for their practices.

WM is not the first to do may of the things they do, they are merely the latest, though not necessarily the worse either, just possibly one of the biggest maybe.

am simply sharing some of my own thinking, experiences and observations concerning these matters so readers may be able to better clue into who the person behind this particular (and future) post(s) is. of course you can check out my blog as well: i.e., Norsehorse's Home Turf.

*update #1*: as time, energy and online allows me to, though I may not always choose to respond either directly or at all, I will try to keep up with any comments that may get posted to my blog posts and, while this is not a promise (or a threat either - smile) that it will happen, I may even get around to blogging another separate post in response to certain comments, suggestions or questions posed.

additionally, though I cannot promise to answer each e-mail either in a timely fashion or possibly ever, I can be reached at:

gmail [dot] com

unless otherwise requested by the sender to not share what they wrote, the contents of email I receive regarding either my ALP posts or WM in general may possibly be shared and answered within future blog posts contributed to this blog by myself.

in closing, due to the circumstances and limitations of the online access I have to work with, I may have to update my posts at time; editing for the purposes of clarification and readability or, on occasion, correcting information I posted. sometimes I will also update posts in order to provide additional information or links of related interest concerning the subject of a particular post. if I do so, every attempt will be made to post a notice within the post to indicate that it has been updated and, at the bottom, briefly what has been updated and why.

thank you for reading.

*note*: added another paragraph, as marked by *update #1*; another 5 paragraphs elsewhere, as marked by *update #2*; and yet another paragraph marked by *update #3 -- each as afterthoughts. in addition, within the rest of my initial post, I made several mostly minor edits for the purposes of clarification and readability only; added a tailing sentence referencing an old article and placing a link to it in the fourth paragraph of the post; just noticed a minor typo, nothing big, but could not resist correcting it. (me a perfectionst? heck no. hey, if I were, I would be getting everything done right the first time around! [wink & grin]): last updated on Saturday, May 1, 2004 at 10:49 PM [EDT].

RFID Comes to Dallas WM 

WM leads by a mile in the race for radio frequency inventory tracking:
Wal-Mart Stores and a number of its suppliers are using a Dallas distribution center as the starting point for a technology that's targeted to one day replace the bar code.

The radio frequency information (RFID) tags provide automatic tracking of pallets and cases of goods. Starting Friday, eight suppliers are to participate, using 21 products to be tracked. Wal-Mart said Thursday that it will have more than 100 suppliers using the tags by January....
This is NOT just another case of WM abusing its position to force technology on unwilling little suppliers!
Hogan said Target and Albertsons are taking on the technology, but Wal-Mart is pushing it most aggressively to its suppliers. Wal-Mart says the technology will help it keep costs low, which it can pass on to its shoppers.

David said the hope is that RFID tags will catch on more quickly than the dozen or so years it took barcodes to become common. The executives said driving the cost of tags to below 5 cents each will make them affordable and that the cost will be driven down as use of the tags grows.

"It's really about getting to this critical mass juncture so we can learn and roll faster," David said.

The executives said there are still elements of the system under development, such as finding a mechanical method of putting tags on products rather than applying them by hand. There is some inertia in that tag manufacturers are waiting for greater demand but that demand won't come until industry standards are refined.

Regardless, Dillman said Wal-Mart is pressing suppliers to get on board.

"We believe in it," she said.
A more business process view can be found in this article:
Participating Suppliers

The eight manufacturers participating in the first phase of the trial are The Gillette Company (NYSE: G - News), HP (NYSE, Nasdaq: HPQ - News), Johnson & Johnson, Kimberly-Clark (NYSE: KMB - News), Kraft Foods (NYSE: KFT - News), Nestle Purina PetCare Company, The Procter & Gamble Company (NYSE: PG - News) and Unilever (NYSE: UN - News, UL - News).

"We are grateful to these companies for their commitment to improving the supply-chain process," Dillman said. "It isn't easy being a pioneer. It takes time, it takes resources and it takes vision. But that's how progress is made and these eight companies are at the forefront of revolutionizing the way we all do business.

"Our other partners are making progress as well," she continued. "We'll be bringing additional suppliers into this trial in the weeks ahead. That's possible because companies are seriously exploring what this technology can do for them above and beyond anything they are doing to address our goal -- something we have advocated from the beginning."

"As an early adopter of RFID in our own operations, we can attest to the tremendous advantage it affords businesses and their customers," said Dick Lampman, HP senior vice president, Research and director, HP Labs. "We believe RFID will help retailers, manufacturers and other users reduce supply chain costs while speeding the flow of merchandise from the factory, through the distribution center and to the retail store, ultimately providing customers with better product availability."
The big boys are taking all the risks.

Don't Leave Your Wheelchair With the Greeter 

or it might be stolen by an elderly couple as they leave the store. WM has loaned the woman a temporary replacement.

WM Lays Off Workers 

35 of the about 400 workers in Somerset Township's WM were laid off in March and April, due to the store not performing as well as was expected. 7 of those were rehired at other WM's.

How common is this at WM and elsewhere? I have little data--but I know that as a retail practice, it is very common--even Nordstrom does this.

WM Receives Little Opposition 

I tend to think that the process of building of a new WM is usually uneventful. It is only with the recent drumming up of WM hysteria--also creating an expectation of difficulties--will a newspaper report that Ontario, Ohio had Little Fire at WM Talks:
Konya spoke at a special meeting for residents to express opinions about the proposed rezoning of land to allow a Wal-Mart superstore.

Seven others also spoke, four in favor of the rezoning and three opposed.

Peggy Toney said she had nothing against the retail giant, but felt the city was moving too fast. She suggested waiting for more impact studies.

"I'm worried about increased traffic affecting me even though I don't live real close. I think we're putting the cart before the horse on this matter," she said....

"I live right across the street from (the land in question) and I'm not opposed to the rezoning. Wal-Mart has done a lot to address the concerns of residents, and I appreciate that. I think they're a good neighbor...."

The hearing was presided over by at-large council member Ken Bender, acting as president pro temp. Bender said he was not surprised so few people were opposed to the superstore.

"I've heard very, very little opposition from the residents," he said.
Here are the minutes of a standard Ontario City Council meeting. Snooze.

Guest Post: Alex Danchanko 

Alex is 18 years old, and lives in Johnstown, PA. I would like to thank him for the major interest he has shown in discussing WM with all of us on ALP, and for the endless interaction in the comments. He has guest posted previously.

From reading this blog and discussing WM issues with other commenters, I have learned two things:

1. Most anti-WM statements are unfairly biased toward other businesses, and come from a desire to artificially boost competition. However, free trade seems to be the best regulator in this department. The result of free trade is the "natural selection" of businesses, in which the best ones survive. This ensures that we have the most successful businesses to deal with when we shop. In addition, employment issues are up to the local managers' supervision, so blame should not be placed on the entire WM chain. Besides, the best way to defeat a capitalist is with your wallet.

2. Many anti-WM arguments, mine included, are too quick to point out the failures of the local economy and use WM as a scapegoat. WM's completely legal practices should not be interrupted just because somebody misses its competitors. I have come to the conclusion that the economy is far too complicated to blame all disasters on WM, and that the attention one can draw would be beneficial. Personally, I neglected to consider that the loss of the steel industry is a more likely cause of Johnstown's economic decline. The new, expanded Super WM could help to return jobs and business that have been lost.

* Also, whomever used the term "commie" to describe an anti-WM position first may have been quick to judge, and it solved nothing, but I think it was an accurate reaction. By preventing a WM from opening by law, government is becoming involved in supply and demand, an element of a command economy, often associated with communism.

Thursday, April 29, 2004

Guest Post: Sterling Wright 

In a previous post, Sterling (who works for WM) defended WM against charges of wrongdoing. In this off-the-cuff post, he defends WM's move into Chicago:

Wal-Mart's move into Chicago should be a very interesting subject for your readers. We did a demo store out in LA on Crenshaw. However, we have opted to go with the neighborhood format instead of the three tiered model we developed.

A lot of Chicago politicians fought us. Why did they fight? It is worth mentioning something about the blighted sections of urban neighborhoods. Chaotic streets with abandoned buildings, gang violence, and uncouth streetwalkers do not occupy the worst neighborhoods. The worst neighborhoods are empty. The streets are silent and lifeless. This is because commerce is absent.

Wal-Mart brings commerce. Far from being dangerous, if storefronts border the streets, and people are busy shopping, the sidewalks are the safest place to be. The key to successful city neighborhoods is vibrant street life.

Vibrant street life is not something that can be designed. It occurs in urban areas when the people have businesses, entertainment, and friends to go to. Few areas in many urban settings are completely without business and money. One of the things I notice about struggling neighborhoods in urban settings is that there are some nice cars around, and some people are dressed pretty well, but there are relatively few businesses. For whatever reason, there is not enough vibrant commerce occurring.

Wal-Mart's move into the Chicago will create an environment of safety in the near future. Remember, hardened criminals hate commerce. It brings cops, private security, and lots of people, which equals lots of attention.

"The Business of America," President Coolidge once remarked, "is business." So, why do local politicians like those in California or Chicago fight Wal-Mart? When was the the last time you heard about gang violence at Wal-Mart? Or a brutual assault. These incidents are rare when Wal-Mart is your neighborhood.

Another Way to Stop WM 

Here's an ingenious move to counter WM. The owners of a strip mall in Crystal River, FL set up an apartment in a vacant storefront required to be folded into the city in order to build a WM supercenter. Apparently, setting up residence will give them veto power over annexation:
Even with the brown slippers by the bed and the pill bottle on the nightstand, it's hard to see this strip mall as a home.

The neighbors include a title company, a beauty shop and the JMJ Oriental Food Mart. Traffic whizzes by 100 feet away on U.S. 19.

For this, Rodger and Renee McPheeters left their $345,000 waterfront home on Kings Bay.

The strip mall is part of 500 acres the city of Crystal River annexed this week, a first step in ushering in a new Wal-Mart Supercenter. City leaders hoped to annex the land without a vote....

Rodger McPheeters, 73, announced at the April 12 council meeting that he and his wife had moved into the strip mall as live-in managers.

After getting a certificate of occupancy from the county, they dragged in a queen-size bed, two wooden night stands and some lawn chairs, barely filling the 2,000-square-foot room.

The city suspected the couple had a motive for the relocation: impeding the annexation plan. So, on six consecutive days or evenings it sent a Crystal River police officer to investigate whether the McPheeterses were sleeping in their new home. In his log, the officer said he never saw them at the strip mall. He took pictures.

But he frequently saw lights on and cars in the driveway at the couple's waterfront home.
The veto power is formidable and clear:
Their opposition could put a wrench in the city's annexation plans, because state law says if registered voters living in the proposed annexation area are against it, city leaders must reconfigure the annexation map so those voters are not included.
The WM in Crystal River has been a long time coming. Sprawl-Busters notes a vote in October of 2003 that turned down the last plan. More:
For three years [since 2000], RealtiCorp has struggled to find a suitable location for the store. The company owns property along U.S. 19 north of Ozello Trail; and last year it selected a parcel just south of West Penn Drive, where the wetlands aren't as plentiful.
WM has had a hard time convincing a Catholic Church diocese to sell a needed sliver of land, even though the parishioners now see WM development as inevitable.

WM Debate at George Mason University 

The Broadside, the student daily at GMU, recently had an exchange by two students, neither of whom I know. The first piece, written by Nick Zinzer, a Broadside Columnist attacks WM for labor abuse:
Wal-Mart’s history is burdened with low wages, union busting and defiance of U.S. labor laws. Past actions highlight the contemptible methods the retailer uses to squash any attempt at union representation and their blatant disregard for labor rights.

Wal-Mart costs American taxpayers millions of dollars every year. State and federal aid goes to Wal-Mart employees annually through social spending. Since the company pays workers so little, employees are forced to accept public housing and food stamps. A report presented by Rep. George Miller (D-Calif.) estimates that taxpayers have to fork over $420,750 every year for a typical Wal-Mart store employing 200 people....

Aside from rampant domestic abuse, Wal-Mart is detrimental to America's image abroad. The retail giant imports products that exploit indigenous workers from developing countries and pays them poverty wages...

True patriotism means keeping jobs at home and providing employees with a sustainable wage. Wal-Mart generates more than enough income to do both...

The company apparently feels it is exempt from U.S. laws. Last October, more than 300 undocumented workers that Wal-Mart paid through a contractor to clean their stores were arrested. Federal officials involved with the investigation said that the undocumented workers were paid as little as $2 a day in some cases and were not given health insurance.
Sound familiar? You and I have read about these charges many times before, and they are snaking their way through college newspapers.

In case you haven't read the report by George Miller's staff ("WAL-MART: HIGH PRICES FOR AMERICAN WORKERS"), here's a link. In my professional opinion, the report is not sound social science, but will be trumpted as such to no end. (Mr. Miller ought to be ashamed).

Also, if you read the newspaper accounts of the illegal immigrant cleaners, you'd know that unnamed federal sources declared there was allegedly one case of one worker being paid $2. Also, how is it that workers in (not from) developing countries are made worse by WM exploiting them? Other than coercion from foreign governments, how can WM take better opportunities away from them?

The second article, by economics major Ryan Mariner, attacks Zinzer and other WM critics:
I have encountered many articles and op-ed pieces that claim big business exploits workers by not paying them a "living" wage. The vast majority of these articles are based upon falsehoods that have unfortunately been accepted by the general public as fact. Nick Zinzer’s op-ed piece "Wal-Mart Exploits Employees" is one such piece.

One of Zinzer’s underlying conclusions is that Wal-Mart needs to pay its employees more. Yet he does not back up this idea with any sound economic logic...

Government intervention into free markets has done more to lower the standard of living then low wages ever will. For instance, government restrictions on imports raise the cost of goods for all Americans. Ironically, this is also a point Zinzer refers to as being "true patriotism." The irony is painfully obvious. Less government regulation, and not artificially raised wages, will help these low-income people afford more goods.
Admirable as it is for an undergraduate economics major to get involved in such dabates, I find Mr. Mariner's refutation rather weak.

Query: Does a reliance on proven fact and tested logic leave economists at a disadvantage when arguing against non-economists who use emotive terms like "rampant domestic abuse", "expoit", and "contemptible"? What if Mr. Mariner were to call Mr. Zinzer a greedy union pimp who wants consumers and low-skilled American workers to suffer so his pals can get $1.50 more an hour? What if he were to call Mr. Zinzer an xenophobe who wants to keep foreigners as low-skilled and as poor as possible? What if he were to call unions vicious protection rackets? What if here were to imply that Mr. Zinzer is a liar and absolutely clueless? Would that be more effective in the debate over WM?

Sadly, yes.

Wednesday, April 28, 2004

WM Sucks Forum 

Until today, I had never visited walmartsucks.com. I thought it would be a standard hate site, but it's far more intruiging than that. It is actually a forum populated mostly by former and current WM employees who want to gripe or boast about WM, its customers, other employees, and everything else. There's much to be harvested from this forum, including the dumbest questions customers have asked WM employees. (Warning, rather crude language).

WM Talks to Communities: April 2004 

Many sincere critics see WM as unwilling to talk to local governments or local non-government groups; they believe that WM is rarely willing to modify plans to meet the legal and extra-legal demands of residents. But this is bunk. In fact, WM meets with concerned citizens and local governments so frequently that I find it almost worthless to link to stories about WM's activities. Here are three examples, all from a Google News search of "WalMart".

For instance, in Florida, we find WM in North Pinellas county not only discussing traffic issues and the size of the planned buffer between the store and a nearby residental neighborhood, but also the finance of a boardwalk along the adjacent wetlands area.

In Utah, the Davis County Clipper reports that the average WM wage in Utah is $9.87 per hour. This information was released by WM in a series of ongoing meetings with concerned local residents that seem to be stretching late into the night.

In Chillicothe City, Missouri, WM is discussing appropriate landscaping around the store perimeter but resisting landscape diamonds throughout the parking lot.

Also note that, contrary to the insistence of some commentators, WM seems not to have run out of rural and suburban areas in which to place its stores.

Guest Post: Frederick Ochsenhirt 

On A Bluegrass Blog, Frederick Ochsenhirt finds ALP and tries to understand WM hatred. The following is a reprint of his post:

Wal-Mart Weblog

A group of bloggers, including Kevin Brancato of Truck and Barter, has started a weblog dedicated to all things Wal-Mart. I saw it via Virginia Postrel's weblog, and was eventually led to this post on Catallarchy discussing an Esquire article (subscribers only), which notes that, popular media accounts to the contrary (which imply that Everybody Hates Wal-Mart), Wal-Mart is, in fact, wildly popular. This got me thinking about Wal-Mart again. Why do they inspire such vitriol from those who could just choose not to shop there? I see a few reasons that aren't all that connected to Wal-Mart itself:

Elitism: It's undeniable, at least to me, that a significant percentage of the Wal-Mart boycotters are put off by the places Wal-Mart locates and the people who shop there. It's the blue state elites vs. the red state consumers. Overgeneralized, sure, but those that do all their shopping at quirky boutiques or Pottery Barn and Williams-Sonoma, for that matter, are unlikely to have all that much sympathy for someone who wants to save money on merchandise from Wal-Mart in rural Arkansas. They see Wal-Mart expansion as a way for "those people" to invade their cloistered world. Wan't proof? Why hate Wal-Mart but not Best Buy or another bix box store that sells to a higher-end market? We don't call them limousine liberals for nothing. Of course, the elites see themselves as protecting the little people from themselves, which leads us to...

Labor activists and fellow travelers: You won't get rich working at Wal-Mart. You won't get free health insurance. You probably can't support a family on a Wal-Mart salary. Of course, you can't do any of those things working for another company in the discount retail space, either, nor frankly should you be able to. A realistic assessment of the relative contribution of these jobs to the American economy should suggest as much, but nobody wants to admit that some jobs are just less valuable than others. Wal-Mart does provide health insurance, and I don't see why they should be expected to do it for free. Vastly increasing Wal-Mart's operating costs would do little to help its employees (many of whom would lose their jobs as Wal-Mart's costs increased), and would certainly harm many who are able to live the way they do only by saving money at Wal-Mart. That's never stopped those who believe that capitalist enterprises are pots of free money waiting for the taking by The People. Similar in many ways to...

Urban Planning Fantasists: Like the labor activists who believe you can conjure up jobs paying $40,000 with free health care for Wal-Mart employees, some Wal-Mart haters think you can wish away half a century's experience with flight to the suburbs. This group sees the success of Wal-Mart as both contribututor to and beneficiary of suburban "sprawl." They argue that Wal-Mart could not succeed but for government subsidies to roads and other infrastructure, tax give-backs, construction of homes further and further away from the cities by shifting costs to existing residents, and so forth. I don't have statistics, but I'd guess that most governments offering explicit subsidies to Wal-Mart do so believing that they'll get more than they give through increased job growth and tax revenue. The other "subsidies" are inherent in the system, and don't have much to do with Wal-Mart specifically. I have long believed, however, that even if you limited the subsidies, you'd still have sprawl. People moved from the cities for a reason: they want to avoid crowding, crime, congestion, bad schools; they want to gain larger homes with lawns to play in, they want good schools for their kids and the recreation opportunities that go with suburban life. Many, many people simply don't see urban life as something to be praised, and gladly accept suburban sprawl as a bearable burden, if not an asset.

Downtown Defenders, or Blinded by the Haze
of History
: This is another class of fantasists, who see Wal-Mart as a threat to the mom and pop stores of a vibrant downtown. They're fantasists because the downtowns they praise don't in any large measure, actually exist. Downtowns have been dying for a long time, threatened not so much by Wal-Mart as by population shifts from the cities to the suburbs. In addition, many of the areas served by Wal-Mart are suffering from economic shifts and dislocation of workers from 19th and mid-20th century industries to a 21st century economy. The downtowns that have flourished are those that have filled market niches, filled with retailers that serve markets not served by big box merchandisers (and which are not threatened by Wal-Mart in any event). Other downtowns have shifted from a retail focus to other areas of economic activity. The idea that if Wal-Mart went away tomorrow, small downtowns would thrive is silly. It may be true that a general merchandiser can't compete from downtown on price, but there are many other businesses and ways to differentiate one's market offering.

NIMBYs: Never discount the power of NIMBYs and BANANAs. This isn't so much an attack on Wal-Mart as a wish that land not currently used for productive economic activity remain thus evermore, at no cost to those that benefit from the open space. Wal-Mart's just a convenient target, but ultimately this seems to be a free rider problem, although many NIMBYs also fall into categories listed above.

There are many other issues related to Wal-Mart, of course, and Wal-Mart certainly doesn't deserve unqualified praise (I wouldn't call them a Randian hero, for example). Real economic analysis has been sorely lacking, and it's nice to see the blog as a central repository.

Decaying Body Found in Car at Wal-Mart... 

Reports of a foul odor emanating from a car in a Wal-Mart parking lot prompted police to investigate.
The Flagler County Sheriff's Office is investigating a suspicious death after a body was discovered Tuesday afternoon in a parked car at the Wal-Mart Supercenter in Palm Coast.
Maybe if Wal-Mart paid decent wages to attract qualified security, its parking lot wouldn't become a dumping ground for criminals. (See? Anything can become a source of vitriol with the proper pretext.)


Tuesday, April 27, 2004

Some WM employees are decent, hard-working people. Some are dirty rats. 

Be careful what you shop for at Wal-Mart. If the cashiers, in all of their worldy wisdom, decide that you might use those products to do something illegal, they just might call the cops:

Women charged after shopping for meth supplies at Wal-Mart

Now, these people may be guilty, but all too often this sort of thing happens to innocent customers who are the victims of overzealous chain store employees.

It's especially common in the photo processing department, where customers have had to deal with the cops and/or the FBI after employees found "suspicious" naked photos of the people's own infants and toddlers or, as in the case of one individual I know, photos of innocent objects that looked to the employee like "bomb parts."

I suppose we can only expect this sort of thing to become more common as the federal government encourages all to become better snitches on our neighbors. Wal-Mart gets no praise from me when it goes along with government schemes like this.

Meijer fights back 

Grocery chain Meijer is essentially 'under siege' in a few Michigan markets with the opening of a new Wal-Mart supercenter nearby. However, instead of merely relying on price cutting as a defense, they have a strategy in place.

By fall, consumers should see several interior enhancements meant to make shopping sense.

For instance, customers have always complained about having to walk clear to the back of the stores to visit the pharmacy. To remedy the inconvenience, the drugs department will move to the front of Meijer.

Meijer also plans on grouping "like" departments to compliment each other, so that shoppers aren't having to walk around the store in search of items.

This is an interesting example, because not only do they call out for support from politically powerful unions (which they employ from), but they also have a plan in place - 'smart' remodeling. This is an interesting idea, since while Wal-mart concentrates on price and store location, an attempt at department combination is unusual - in fact, retailers often rely on the need to move around the store quickly.

This could mean a great deal of difference - should consumers respond to this, it could be duplicated, but the key factor is the amount of time that the Meijer's chain can take advantage of this.

David Karjanen in Newsday 

The media tide against WM just keeps swelling. I have only so much time to discuss this opinion piece, every sentence of which needs to be dissected:
Wal-Mart has gained a reputation for destroying small-town main streets by putting other retailers out of business, and building sprawling stores that generate traffic and pollution.
Question to readers: Do you always trust everybody's opinion? I don't. Reputation is built from opinion. I would suggest to the author to tell us what small part of the world thinks WM has such a reputation; what he hears from a limited group of other people is not fact.
[I]t was citizens of the small Los Angeles County city of Inglewood who showed that the retailing Goliath can be defeated.
And it was the citizens of Contra Costa, by overturning a supercenter ban enacted by elitist legislators, that showed that people actually want Wal-Mart. We're not picking and choosing our anecdotes, are we?
[WM] spent over $1 million gathering signatures, advertising and engaging in other PR gambits to overturn a city council ruling and to exempt the project from any further review.

The effort backfired. On April 6, residents rejected Wal-Mart's initiative 7,049 to 4,575.
Are we supposed to get the impression that WM didn't want to work with the City Council? Isn't it true that the City Council had already stonewalled WM for over a year? Isn't it true that the 11,500 votes only represented 29% of the 40,000+ registered voters, and that in a town of over 100,000. 7,000 residents telling 93,000 where they can shop and work is not really a prime candidate of how democracy is supposed to work? Also, later on the author mentions, "despite proposing a development that may meet or exceed environmental and land-use criteria...." Why was the City Council trying to "review" the WM if it meet all the predetermined criteria? Because this debate is about issues outside the control of most city governments.
Why all the controversy? The main difference is scale: Wal-Mart dwarfs most competitors. But, it is often argued, Wal-Mart brings jobs and tax revenue. Right? Wrong.

The stores create jobs initially, but most studies show that the jobs generated are merely lower-paid replacements for ones lost due to the competition. Smart-growth advocates note that Wal-Mart's developments generate traffic, noise and further car-dependent land uses.
The difference is clearly vision and planning, not size. Also, up to Copernicus, most studies showed that the sun revolved around the earth. Correct studies showed the reverse to be true. What do the correct studies show about WM and job creation? That, on net, it creates jobs. Little is known about the pattern of changes in wages.
Cumulatively, these effects have ruined downtowns and undermined local economies. As a result, sales and property tax values can actually decline in a city as competing commercial space becomes vacant and blight develops.
The question is NOT about "can actually" happen but what has happened, and is likely to happen. Has WM caused blight in small towns across the US? Answer in the affirmative or negative, please. If in the affirmative, please come up with a source that documents which small towns have been so hard hit. I haven't seen studies showing this. Has anybody???
Overall, research on the company and communities is demonstrating that the municipal revenue and job creation often touted by company officials fail to meet expectations. Over time many communities have felt more harm than help after Wal-Mart came to town. So, can anyone blame the people of Inglewood for not embracing the nation's largest retailer with open arms?
That expectations are too high is probably true. But flowery language that "communities" feel anything is ridiculous. Are people who shop and work at WM worse off than before WM entered? Note that I am not asking whether small store owners are worse off; in most cases, they probably are. It's not small store owners don't matter; it's that they should not be given monopoly provider status by the rulings of a city council. With the restriction of WM, we have a case of concentrated benefits to small store owners, and a dispersion of costs (the savings not had by WM consumers). It's much more worthwhile for the small store owners to lobby local politicians--and show up at meetings--than it is for the consumer.
One solution is to have Wal-Mart and communities actually sit down at the table and attempt to have an open discussion about the issues. But if events in Inglewood are any indication, the company seems to be more intent on having its own way - regardless.
As chronicled on this blog, WM "sits down" all over the country with city governments. It tried to do so in Inglewood and Contra Costa. Just google news WalMart, and you will find a dozen cases of WM discussing planning issues with local governments. The author seems intent on having his own conclusion supported - regardless.

Best WM Headline of the Day 

Of all the news outlets, the Scotsman had the best headline for the WM sales release:
Sales Blow at Wal-Mart
The world’s biggest retailer, Wal-Mart Stores, said its April like-for-like sales were tracking near the low end of its four to six per cent target growth range.

Modified Disclaimer 

With the addition of Shawn McNaughton (who works in a WM store) and Angus McPhee (who works outside of, but with WM), ALP must change its dislaimer, which now reads: Those of us who work for WM admit it freely. I wonder if the unions who claim to have the "common worker's interest" at heart will be willing to listen calmly to people who like working for WM.

Two WM Critics 

Many bloggers have written on WM. It's about time we catch up with two of them.

In WalMart's way to the future, Larry Lessig finds that WM's 88 cent music download is overly restrictive in terms of service.
This is the real aim of the “war” against “piracy.” Focus the attention of the world on “pirates” and then “solve” that problem in a way that effectively removes all other creative rights for consumers. This is a total perversion of copyright law, as the late Professor Lyman Ray Patterson showed. The law, intended to regulate competitors, is now a tool for controlling consumers.
This is a VERY serious criticism of WM.

On the Industry Standard, Thomas Goetz unfolds WM's new PR strategy. However, he needs to back up his claims--WM wages are "poverty-level", WM has "artificial" market power, WM has "unfair leverage--with some data about the real world:
This seems to me a classic non sequitur. To translate: "If we paid our staff poverty-level wages, our customers would stop buying things here." Well, no: that's not true at all. Indeed, that's part of *why* WalMart has managed to get its prices so low - at times artificially low. Not by streamlining supply lines or managing their supplies better to meet demand, but by artificially imposing their will onto a market. Ie, they demand that Acme Widgets sell them widgets for 16 cents, even though it costs Acme 15 cents to just get them out the door. If Acme refuses, Walmart will move on to their competitor. So Acme caves, slashes its own employee wages, and Walmart gets its price. That's unfair leverage. And if part of that Low, Low Price comes because Walmart pays it's own employees so little, well, that's the story Walmart doesn't want to let get into the press.
Does he really think all WM-supplier relatiomships are like this? Why? I cannot take criticism--WM "imposing their will"--like this very seriously. It rings true to some people, but for those of us without an instinctive dislike of real-world markets, it sounds more like scare mongering. The classic Fast Company article showing WM's love-hate relationship with a few suppliers has apparently let some people feel justified in believing and stating whatever they want about ALL WM suppliers.

Monday, April 26, 2004

Guest Post: Shawn McNaughton 

This is an updated version of a rant on Shawn's own blog. You can see the original at his site at http://hitoma.com/blog/.)

I'm a Wal-Mart employee and, although it's merely while I get my I.S. Degree, it's not a bad job. Sure, it's not perfect, but what job is? It's actually kind of sad to see a decent place so mistreated.

Take this weblog, for example...

Admittedly, ALP purports to be about the best and worst of WM. This is a fair enough statement; the author even comments on the outrageous vitriol of one newspaper reporter. Yet from what I saw as I looked through the archives, the good news was rare and unimportant (a WM opens in Japan), while the worst was rampant (About how WM's health plan doesn't cover pre-existing conditions, what WM's responsibility is in health care, dress code firing over slightly disturbing religious attire, Wal-mart going up against Microsoft...). Let's examine the negatives:

WM helping Sun against Microsoft by offering an item for sale? Does that mean that by selling Pepsi supermarkets pounded the nails in Coca Cola's coffin? Not quite. And after recent events, doesn't Microsoft control Sun?

Dress code issues are not WM-specific. He wore a turban-style headdress, a priest's shirt, and many crosses. Whether or not this is directly required by his religion, doesn't a place of business have a right to assign a dress code to shape morale and help customers identify employees, especially when other retail chains and fast food joints have before them? Since many fast food chains fire employees for wearing non-uniform yet socially acceptable clothes, this isn't a big surprise. In fact, his argument could be reversed - if Wal-mart were to allow an employee to dress in that fashion, would it not be endorsing his religion? Wal-mart is the private sector, but because of scale it could be an issue.

Health care is a bit of a sticking point. I turned down the plan since I'm covered as a college student, but it's not too bad, unless you want a super-low deductible. And EVERY health plan has clauses against preexisting conditions. After all, if they regularly covered preexisting conditions, what is stopping someone with a condition - perhaps not even a terminal condition - from taking advantage of the ability to change plans?

It's just sad that Wal-mart is attacked for this junk and not for meaningful issues, which do exist but are primarily internal. Understaffing, promotion bias (extremely limited, but never avoidable), and other issues do exist, but they don't surface.

Thomas Sowell on WM 

While discussing the criminalizing of business in California, Thomas Sowell hits on WM and Jesse Jackson:
According to the Chronicle columnist, Wal-Mart was "trying to bully its way into another targeted community." Putting an issue to a vote is called "bullying" when business does it, and the community where it wants to locate is called a "target."

Among the other rhetorical flourishes of this indictment is that Wal-Mart tries to "crush the competition." What does such purple prose amount to? That some people prefer shopping at Wal-Mart rather than in competing stores, so that some of the latter may end up going out of business as a result.

In all this venting of spleen against Wal-Mart in the Chronicle column, there is no mention of the cynical role of community activists in depriving a low-income community of jobs and taxes. By flexing their muscle against Wal-Mart, Jesse Jackson et al have shown that people who want to locate businesses in minority communities have to get their OK -- and that OK will not come cheap.

The ability to extort money from big businesses is a major part of Jesse Jackson's operations. Obstruction and name-calling are the weapons and hard cash is the pay-off.

All this works only because of those who will believe race hustlers and those who will keep up a steady drumbeat of anti-business rhetoric. California has plenty of both, which may be why there are only one-sixth as many Wal-Marts per capita in California as in Oklahoma.

Don't Hold Back Your Anger 

In Wal Mart, Why To Stay Away the Chi Senshi (in the Vallejo News) pulls no punches--even the illegal ones. It is a hard-to-beat example of discourse built upon emotion and unverified belief. The author knows so little about WM, and hates it so much:
A few weeks ago, before the primary ballot in March, I had a job with ACORN, an independant organization that organizes rallies and marches for the common worker... The following is the truths of Wal Mart that I realized at this job.

Not only does Wal Mart want to open supercenters in California -- about 40 of them, that will be 3-4 football fields in size (approx 20 acres or more) --, they also are anti-abortion, pro-censorship, and filthy stinking liars....

There are people in this state that think Wal Mart will be a good thing for the state, that it's cheap prices will be helpful to the student or parent on a cheap budget. Maybe right now, because all that most people want is instant gratification, it's cheap prices are helpful, but when all other competition is out of the way, the prices are inflated horribly....
I pass over the comment about liars, as being a self-fisking, and wish to focus on the idea that WM inflates prices once it eliminates the competition. First, it does not kill all competition. Second, even in areas where it has put its major competitors out of business, it has never raised prices. Could it do so in the future? Sure, if it is willing to alienate all its customers, leave a clear opening for its competiion, and probably bankrupt itself.

Such price actions also clearly violate the Robinson-Patman Act. However, this act causes as much trouble as it pretends to solve, and is not a "solution" to anything. This is part of the reason it is no longer enforced literally:
passed by the U.S. Congress in 1936 to supplement the Clayton Antitrust Act. The act, advanced by Congressman Wright Patman, forbade any person or firm engaged in interstate commerce to discriminate in price to different purchasers of the same commodity when the effect would be to lessen competition or to create a monopoly. Sometimes called the Anti-Chain-Store Act, this act was directed at protecting the independent retailer from chain-store competition, but it was also strongly supported by wholesalers eager to prevent large chain stores from buying directly from the manufacturers for lower prices.

WM's enemies show their true colors. 

The jerks on the White Plains and New Rochelle, NY, city councils referenced in the article Mr. Brancato linked to below have some nerve:

White Plains officials were less adamant in their opposition to a Wal-Mart, but still expressed concern that it would not lure shoppers to the city. Rather, several said, it would duplicate a niche already filled by Sears, which moved to the city's Galleria mall in August, and Target, which opened in October across from the old Sears site.

"We certainly don't need to fill up downtown with discount stores," said Councilman Glen Hockley.
I'm sure it's all the same to Glen Hockley, but to say that Sears and Wal-Mart fill the same niche is absurd. This seems to be nothing more than a ploy to keep anyone below a certain income level out of Mr. Hockley's sight at all times.

And then there's this bit from Councilwoman Marianne Sussman of New Rochelle:

"They are not a business that I feel we could be proud of to have in town," Sussman said, "Both because of their employment practices and the nature of the retailer." She said she wanted a more upscale retailer.
So apparently Wal-Mart's "employment practices" are bad for unspecified reasons, yet it's okay for Marianne Sussman to force people with lower incomes to have less because of her personal preference for "upscale retailers."

What unmitigated evil.

Sunday, April 25, 2004

Wanted: Free Access to Trade Publications 

In order to take my analysis of WM to the next level, I need the best data I can get my hands on. As an Almeda, CA councilman said last year, "I've got mounds of material, and there is a lot of data that I studied that was basically propaganda." However, good data and reports about WM are not tax-funded, and hence are not provided "free" like government macroeconomic data.

Anybody out there have industry reports like these they'd be willing to share with, or would like reviewed by, an economics Ph.D. candidate?

If so, please email kbrancat-at-gmu.edu.

I'll also renew the call for anybody who wants to send in a guest post, or become a blogger on ALP.

WM as Lynchpin to Economic Development 

Usually WM is castigated for allegedly gutting downtown areas. Sometimes many small businesses close when WM competes, but that's not the complete picture. Sometimes other businesses flock to the site of a new WM, seen as a goldmine in traffic--an anchor for stores, only not in a shopping mall. The Fairbanks Daily News-Miner provides an excellent summary of one such case:
Wal-Mart's arrival, coupled with its plans to expand to a 250,000-square-foot supercenter format to sell groceries within a couple of years, adds a new dynamic to Fairbanks' retail market.

Representatives from some of the city's other major businesses, such as Fred Meyer, Sears and Safeway, said they will have to rely on their niche markets to compete with a company both loved and loathed for its dedication to selling products cheaper than anyone else.

The other strategy for competitors appears to be taking advantage of Wal-Mart's business traffic, as evidenced by the slew of new construction scheduled for the area surrounding the retailer's site off the Johansen Expressway.

Fred Meyer officials said they plan to put out to bid this week a project for a new, 178,000-square-foot building with the same format as its Airport Way store. The new store will replace the College Road location, selling everything from clothes and electronics to groceries, said company spokeswoman Mary Lofton.

"If all goes well, we'll be breaking ground in May," she said.

Lowe's Home Improvement Warehouse has also submitted an application to build a 139,773-square-foot store in the area. First National Bank Alaska is adding its third Fairbanks branch next to Wal-Mart in an area that's seems poised to become the city's new retail core.

For now, Lofton said trying to quantify the impact of a Wal-Mart on the existing Fred Meyer stores is next to impossible.

"I can tell you that we have many, many communities where we compete with Wal-Mart," she said.
[Emphasis added.] Many people overestimate the accuracy of economic impact statements; "next to impossible" is not quite right, but is much closer to the truth than economic forecasters would like to admit.

The article also discusses other common issues of lower prices and lower wages:
As she unloaded a cart full of groceries into her car in the Fred Meyer West parking lot, Dina Kelly said she thinks Wal-Mart will give lower-income families a break.

"I'm a mother of three, so it's not like I want to go to Fred Meyer and pay $30 every time my son needs a pair of summer shorts," Kelly said.

Cutting costs

Wal-Mart's cost-saving culture is evident throughout its new Fairbanks location.

When shoppers start coming in at 8 a.m. Wednesday, they'll be greeted by a bare concrete sales floor. The store does not plan to add tile.

"It will save us a half a million dollars a year just on floor costs," said Erickson....

However, Fairbanksans seem more than willing to take a Wal-Mart job, which comes with a starting wage of $9 an hour or more, depending on experience and the position.

Erickson said the store received 2,200 applications to fill about 500 positions.

Last week, a Wal-Mart human resources worker sat at a table in the training room with a stack of Alaska driver's licenses, starting employee files while the new hires filled several rows of chairs and watched a video about the company's history.
The manager started at WM stocking toilet paper:
Erickson looks at his own employment record with Wal-Mart in evaluating the company's treatment of workers. A man who insists he's not smart, Erickson started in a store in Gillette, Wyo., "stocking toilet paper."

A manager saw he had potential and began mentoring him and telling him about the benefits of a Wal-Mart career.

"Wal-Mart's history just blew me away," he recalled.

Erickson eventually wound up as a manager at the Dimond Center Wal-Mart in Anchorage, then was offered the job of leading the new Fairbanks store.

Even a toilet paper stocker has opportunities at Wal-Mart, he said.
Earlier in the article is something I had not heard about WM before--some of them run out of stock soon after opening:
New Wal-Marts in other communities, Erickson said, have made the mistake of not being prepared to replace the goods sold in the initial onslaught of sales. He's determined not to let that happen in Fairbanks.

"I take that as a personal challenge," Erickson said.

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