Tuesday, November 01, 2005

WalMart War Room

So, as part of my sinister plan to crowd out all of Mike's posts, I offer this...

In case you needed a reminder that the Democratic and Republican parties are ideologically a lot closer that people often think, look no further than the WalMart "war room," a cadre of former high-ranking political operatives from the major parties who spend their professional lives defending WalMart against criticism. (That's a full-time job if I ever heard one--I wonder if they get benefits.) Big companies do tend to bring people together across party lines. If you want bipartisan institutional support for a bill, make sure that it contains provisions endorsing consumer capitalism, stupid wars, and happy puppies.

The ability of WalMart's war room to generate bipartisan support doesn't merely prove that political operatives can be some of the most cynical, amoral human beings on earth ("buypartisan support"); it also proves that the problem that WalMart represents goes way deeper than party platforms. People who attack WalMart often make the issue a moral one, as if there were some problem with the particular corporate culture of WalMart. But the problem is political. Not "political" in the relatively superficial sense of which party or candidate or zoning variance permits or forbids what. "Political" in the fundmamental sense that how our economy works in large part determines not only the more superficial politics of our lives but also a whole array of everyday choices and possibilities--the ways we spend our time in order to have some guarantee of food, shelter, and community.

WalMart is the way it is because our economy (which is largely globalized at this point) is the way it is. WalMart's business model depends on 1) differential wealth distribution across nations, 2) economies of scale, 3) sales volume, and 4) weak labor protections. That is, if (1) China were as wealthy per capita as the US, then WalMart couldn't buy cheap Chinese products and sell them in the US. If (2&3) WalMart couldn't get so huge, then it could neither keep its costs low by massive bulk purchases nor generate such reliable profits on such tiny margins. And if (4) workers in China and elsewhere producing those cheap products had meaningful labor protections, then the products wouldn't be so cheap AND if its store employees in the US and elsewhere could unionize and demand better benefits and salaries, then those tiny margins would get too tiny.

For me, #1 and #4 are the crucial ones. Economies of scale and sales volume are simply facts that emerge in our economic system when companies get big. But it's the differential wealth of nations and the lack of labor protections at home and abroad that allow companies to get big in certain ways and to shaft their workers as a result. WalMart, as it is, simply couldn't exist if the US and China had better worker protections. To see that you only have to see what happened the one and only time a WalMart store got a real union (the corrupt, oppressive Chinese government-sponsored "unions" don't count). When a Canadian WalMart voted to unionize, WalMart corporate just closed the whole store. End of store, end of story. The store might have been able to make a profit as part of an almost entirely non-union corporation, but if unionization had started to spread, WalMart's existence as a corporation would've been in trouble.

WalMart may be slightly ahead of the curve in terms of growth and worker-shafting, but it's not an aberration from our system. It's the company that shows us where our system is and where it's heading. Henry Ford once doubled the standard factory worker's wage to $5 a day because, as he put it, he needed to create consumers who could buy his cars. Those days are over in this country. Now we have WalMart, which halves the standard wages so that its employees have no choice but to shop at its stores. (This isn't an endorsement of Ford's candidacy to the hall of Marxist saints--he was out to make a buck, pure and simple. But the way he took advantage of differential wealth in order to make that buck was very different than the way WalMart does.)

The direction that WalMart clues us into is a frightening one and part of a large and powerful system of global capital movement. But it's also one that--in theory--everyday people in this country do have some power over because everyday people can vote and because they can act. The behavior of corporations and the movement of money is not the same as the behavior and movement of hurricanes. Corporations and money are human constructions--national and international agreements that require daily consent by the people inside them to their continued existence. And I don't mean that in some fancy, philosohical way. I mean it in very straightforward, literal terms. A corporation is a legal entity. If we as a nation were to pass different laws radically changing the legal definition of a corporation--and if the armed services backed the government when the corporations traded their army of lawyers for actual armies--then corporations would become different things entirely. (Of course, that's unlikely to happen because--remember the WalMart war room?--the people running the political parties tend to like corporations just as they are.)

Backers of globalization or laisez-faire capitalism will often justify their support by making recourse to the laws of economics. But they don't mention--or necessarily realize--that those laws aren't natural laws like the laws of physics. They're derivative laws: the laws of economics are only true if people continue to live their lives in accordance with political and social laws that make those laws of economics true. But because our economic system is set up the way it is, the political and social laws that perpetuate it can feel totally natural, even if they feel scary and dismaying at the same time.

Still, the laws of economics aren't any more natural than the laws of baseball. Your Little League coach may have eventually convinced you that you can't run the bases clockwise. And you may now take that as a simple fact. But if everybody on the field changes the rules, you can run the bases clockwise. Or not run them at all. Or you can stop playing baseball altogether.

There might not be an urgent need to change the rules of baseball, but I think there is one to change how our economy works. When the most logical and efficient way to play our particular economic game is to put together a corporation that keeps workers everywhere at or below subsistence wages in boring, routinized jobs, everybody playing the game will start doing exactly that. And that, to me, means we need some mighty big rule changes mighty quick.


At 9:12 PM , Blogger Mike M. said...

So much right stuff here.

I think the theme we've both been hitting on a lot lately is that when you decide, as we seem to have done, that markets are inevitable and that politics can do nothing about them, you're left with whatever the market gives you. Politics, for all its flaws, at least people's takes hopes, wishes, dreams and intentions into some sort of account when it operates. Markets are reflect such issues only in a small way and in the large sense, they kind of was out.

Great point about Ford. Turning your workers into consumers of a high end product has an entirely different effect than turning workers into consumers of low end products.

Another point of interest: Wal-Mart has only recently become interested in politics and public relations. For a long time, they didn't have to. The short-term effect of a new Wal-Mart was to boost local economies by bringing prices down. The long-term effect, which was only seen decades into the chain's expansion, was to depress wages to the point that lower prices don't much matter.

I doubt there's much conspiracy within Wal-Mart. Store and regional managers try to make their budgets and they do it by squeezing suppliers, buying product abroad and cutting wages, even to the point of hiring cleaning contractors who supplied illegal immigrant labor, a big enough step removed from Wal-Mart that the company could claim, once found out, to have been duped rather than responsible.

So, now... they're big into politics and PR and are trying to sell their story to Washington and to the country.

I doubt Wal-Mart is evil. But it is what it is, as you say, because it's unfettered and it has become a problem.

At 9:19 AM , Blogger tifanie said...

Ask Sunshine about the Nazi-like Wal-Mart meetings she witnessed on a semi-regular basis during her last job.


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