November 30, 2005

SAM[ARITAN]'S CLUB:

Progressive Wal-Mart. Really. (Sebastian Mallaby, November 28, 2005, Washington Post)

Wal-Mart's critics allege that the retailer is bad for poor Americans. This claim is backward: As Jason Furman of New York University puts it, Wal-Mart is "a progressive success story." Furman advised John "Benedict Arnold" Kerry in the 2004 campaign and has never received any payment from Wal-Mart; he is no corporate apologist. But he points out that Wal-Mart's discounting on food alone boosts the welfare of American shoppers by at least $50 billion a year. The savings are possibly five times that much if you count all of Wal-Mart's products.

These gains are especially important to poor and moderate-income families. The average Wal-Mart customer earns $35,000 a year, compared with $50,000 at Target and $74,000 at Costco. Moreover, Wal-Mart's "every day low prices" make the biggest difference to the poor, since they spend a higher proportion of income on food and other basics. As a force for poverty relief, Wal-Mart's $200 billion-plus assistance to consumers may rival many federal programs. Those programs are better targeted at the needy, but they are dramatically smaller. Food stamps were worth $33 billion in 2005, and the earned-income tax credit was worth $40 billion.


Take away the naive view and what do the critics have left?

Posted by Orrin Judd at November 30, 2005 11:59 AM
Comments

Outrage. Lots of empowering outrage.
But don't worry, they'll always be able to find something to get their knickers in a twist about.
Which, I suspect, is why they are so often ignored.

Posted by: Mikey at November 30, 2005 12:05 PM

The truth that sets them free? Nah.

Posted by: erp at November 30, 2005 12:33 PM

What they wind up with is what they start out with: baseless moralizing presumption.

Posted by: Luciferous at November 30, 2005 12:34 PM

Now look, Kerry and Edwards and their wives went to Wendy's last year during the campaign. Sure, Tereza didn't know what chili was, and sure, they had vindaloo waiting on the bus, but I'm sure that John Kerry and his husband could find their way around Wal-Mart. After all, toothpaste is toothpaste, and underwear is underwear, no?

Posted by: ratbert at November 30, 2005 12:54 PM

You're asking oj that question?

Posted by: joe shropshire at November 30, 2005 1:06 PM

Wal-Mart's biggest beneficiaries over the years have been the rural lower income families, since Wal-Mart's strategy back in the 1980s was to open everywhere, while other stores like Target focused their attentions on expansion into suburban areas or cities with populations of 100,000 and up.

Since those yelling the louded about Wal-Mart's explotive practices (and admittedly, there are some) wouldn't venture into a really rural area -- i.e. no big city within 100 miles -- unless you put a gun to their heads, you're not going to see the same mixed signals you see in the case of Starbucks, which is also one of the far left's main corporate demons. But they haven't gained the same sort of antipathy from the more cynical/pragmatic politicians and activists on the left, because they know too many of their core supporters actually go to, and like the place, overpriced lattes be damned.

Posted by: John at November 30, 2005 2:19 PM

They also keep thousands off the welfare roles. They hire many people that cannot compete successfully in ‘the glamorous, smart' retail sector. This contribution may be of greater value than the low prices. Especially to those who are able to gain meaningful employment at Wal-Mart.

Posted by: tgn at November 30, 2005 3:18 PM

It really irritated me when Daley and the local alderman wouldn't permit a Wal-Mart be built on the west side of Chicago. It would have brought 300 or so steady jobs and good quality merchandise at great prices to a neighborhood that has precious few of either.

Posted by: Rick T. at November 30, 2005 3:18 PM

Every Walmart I have visited has lots of Blacks, Hispanics, old white people and poor people of all types. I think most anti Walmart screeds are a screen for classism, racism and ageism (for lack of a better word on the last one).

Posted by: Buttercup at November 30, 2005 4:33 PM

That's why I buy all my clothes at K-Mart--to avoid the Wal-Mart trash.

Posted by: oj at November 30, 2005 4:39 PM

Unfortunately, Wal-Mart doesn't really have "every day low prices." What it has are the lowest prices on a select amount of goods designated to attract customers to the stores. All other goods, the vast majority, may be priced equal or greater than their competitors.

I'm not anti-Wal-Mart. I shop there myself, but one should not assume that they are getting cost savings simply by buying there. Going to other discount stores could be just as beneficial. I'm very interested in exactly how these cost benefits are calculated. What's the baseline?

Posted by: Chris Durnell at November 30, 2005 4:42 PM

Wal-Marts in central PA are the only places I know where you can see Mennonites, Goths, punkers, rapper wannabes, new immigrants (legal, illegal - who knows?), and 400-pounders in close proximity.

For that alone, it's worth the trip.

OJ - does that mean you're buying Martha Stewart?

Posted by: jim hamlen at November 30, 2005 4:46 PM

Chris: That's not my experience. I find their prices to be uniformly low, with few exceptions found almost entirely in the electronics/software/music area. Moreover, the savings in food and house-hold goods are steep. Some of their pricing can be beat on the Internet, but I'm not sure that the transaction costs don't make it a wash.

I do find that their quality tends to be lower and I've pretty much stopped buying adult clothes there, as they don't hold-up well. For kids' clothes, it's great.

Posted by: David Cohen at November 30, 2005 5:00 PM

It's pronounced "K-Marché"

Posted by: Mike Beversluis at November 30, 2005 6:07 PM

it's the mutants that put me off Walmart.

Posted by: Mahatma Kane Jeeves at November 30, 2005 9:58 PM

Not that I'm bragging about my poverty like those guys in the old Monty Python sketch, but I make much less per year than the average Wal-Mart shopper outlined in this article and, trust me, Wal-Mart has been very helpful in getting me good products at low prices.

It's particularly galling to read leftist garbage about Wal-Mart when you're trying to make rent payments while limousine liberals haughtily sniff the air at the merest mention of the nation's #1 private-sector employer.

Posted by: Matt Murphy at November 30, 2005 10:16 PM

In the interests of full disclosure, I should also note that my younger brother, who is in a tight financial situation as well, works at a Wal-Mart.

Posted by: Matt Murphy at November 30, 2005 10:18 PM

Sometimes I shop at a Cost-Plus 10% store, but Wal-Mart's prices come out about comparable for me and the meat and producer seem to be better, usually. You are right; you can't beat Wal-Mart for kids clothes. $6 for a Garanimals outfit! All 3 of my kids have worn plenty of Wal-Mart clothes over the yrs, and when I only had $60 a week to feed a family of 5, you can bet I was spending a lot of time in Wal-Mart.

Posted by: sharon at November 30, 2005 11:35 PM
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