John Kerry is rarely among the 100 million people who shop at Wal-Mart in a given week; the Heinz-Kerry household is probably not among the 80 percent of American households that shop there at least once a year. But he is among the liberals denouncing Wal-Mart’s “disgraceful” and “unconscionable” practices, which according to a huge class-action lawsuit–liberalism rampant–includes sex discrimination.
The National Trust fears for Vermont’s “sense of community,” which evidently is threatened by… the community: Wal-Mart would not be expanding there were it not confident of a substantial unmet Vermont demand for its services. Long ago, liberalism relished Sinclair Lewis’s lampooning of the supposed parochialism and materialism of “Main Street.” The “community” that progressives would protect from Wal-Mart is Main Street shopkeepers whose hefty profit margins are threatened by competition from “big box” stores at the edge of town.
Zoning and other laws used to block Wal-Marts from opening are, in effect, tariffs serving domestic protectionism. Talk about protecting “a sense of community” often is avarice masquerading as altruism. It is rent-seeking–the use of government to confer economic advantages–tarted up as political philosophy.
Labor unions fret that Wal-Mart forces competitors and vendors to minimize labor costs. After a bitter five-month strike, unionized workers in Southern California grocery stores agreed to cuts in pay and benefits in an effort to protect their jobs from Wal-Mart. It is the world’s largest grocer, with one fifth of the American grocery market. Wal-Mart has just 8 percent of U.S. retail sales, compared with, say, Anheuser-Busch’s 50 percent of U.S. beer sales, or General Motors’ 28 percent of U.S. auto and light-truck sales.
Kerry denounces the procurement and labor practices that, according to the McKinsey consulting group, made Wal-Mart responsible for about 25 percent of the nation’s astonishing productivity increases in the 1990s. The low prices made possible by these practices have made Wal-Mart a significant contributor to low inflation. Warren Buffett says Wal-Mart has contributed more than any other company to today’s economic vigor.
Southern California, where the company has won some legal skirmishes and has lost some, is currently ground zero in the Wal-Mart wars. Unions are strong there and groups of liberal activists are, well, active. But Steven Malanga of the Manhattan Institute reports that a study sponsored by Wal-Mart but conducted by the Los Angeles County Economic Development Corporation (LAEDC) estimates that “Wal-Mart’s entry into the local market would save county shoppers about $1.78 billion annually and southern California shoppers $3.76 billion annually, or nearly $600 per household.” The study argues that those savings, redirected to other spending, would create up to 36,000 jobs, compared with the maximum of 5,000 jobs lost among competitors.
Fifty percent of Wal-Mart employees get health insurance through the company, and 90 percent have insurance–from parents, a spouse or some other source. Annual turnover in the company’s 1.4 million employees is 44 percent, just a bit above the retail industry’s average (40 percent). This is partly because upward mobility is possible–two thirds of managers of Wal-Mart stores began as wage workers–and because Wal-Mart wages are, according to the LAEDC study, less than $3 an hour below union wages in comparable retailing jobs.
In the past century, arms control, another liberal passion, limited the number of certain nations’ battleships. The result? The rise of pocket battleships–ships with hull sizes just small enough to not count as battleships, but packing the wallop of battleships. Wal-Mart has opened a 99,000-square-foot store to comply with an anti-Wal-Mart law banning stores larger than 100,000 square feet.
Many more stores of various sizes are coming: every month Wal-Mart buys more than $1 billion in real estate for new stores. Critics of “Sprawl-Mart” suggest that the 42-year-old company is responsible for America’s preference for low-density suburban living. But that preference is long-standing, as is the liberal intelligentsia’s contempt for it.
Economic efficiency is not a value that trumps all others, and Wal-Mart’s efficiencies, although they confer considerable benefits, also confer some costs. Both the benefits and the costs are mostly conferred on Americans of modest means. And the tone and tactics of the war against Wal-Mart suggest that it is colored, as is much of today’s politics, by the contempt of “progressives” for what they consider the vulgarity of popular tastes.
