We’re watching Robert Greenwald’s Wal-Mart: The High Cost of Low Prices. Shocking. The film’s website is here, and you can watch the trailer here.
Some crazy stats and facts, from the film and Wikipedia:
- There are 27 million square feet of empty Wal-Mart buildings in the US. Many of these are stores that were closed or were not finished because the company moved to an adjacent area with lower taxes. Wal-Mart routinely receives tax breaks and other subsidies of $100,000 to $2.1 million when opening a new store.
- Wal-Mart imports $18 billion in goods from China. In one factory featured in the film, workers earned $3 a day, and worked 14-hour shifts 7 days a week.
- Wal-Mart’s health insurance covers 44% or approximately 572,000 of its 1.3 million U.S. workers. In comparison, Wal-Mart rival Costco insures approximately 96% of its eligible workers.
- Wal-Mart encourages its employees to apply for welfare and Medicaid rather than provide adequate and affordable coverage. CEO Lee Scott said “In some of our states, the public program may actually be a better value.” The vast majority of workers qualify for public assistance, which costs the state of California over $75 million a year - just for Wal-Mart employees who do not receive adequate benefits.
- The average hourly Wal-Mart employee earns $13,861 a year, which is well below the poverty line for a family with two children.
- Wal-Mart CEO Lee Scott boasted before TV cameras of sharing a hotel room with another executive (saving $200) and eating a $10 dinner while on a business trip in New York, as examples of his commitment to saving money. Assuming he works 40 hours a week and works 49 weeks a year, Scott earns $13,881 per hour. His compensation in 2005 was $27,207,799.
- Wal-Mart’s jet fleet is worth $125,350,000
- Wal-Mart employees gave more than $5,000,000 to help their fellow workers in need in 2004. The four Walton heirs, each worth $18 billion, gave $6,000.
- Wal-Mart routinely and systematically forced workers to work extra time off the clock in order to keep labor costs low. Employee class-action suits have been brought in 31 states.
- 80% of crimes that occur on Wal-Mart property occur in the parking lot. Adding golf-cart security patrols reduces the crime rate in parking lots to nearly zero, according to an internal Wal-Mart study, yet the patrols were not added. Numerous lawsuits from rape, robbery, and carjacking victims ensued.
I will not be shopping at Wal-Mart any more. If poor people shop there, I certainly will not judge them, since they need the low prices to get by. But I will be spending my money elsewhere, even if it means paying more.
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Justin, I understand and, in some cases, share your concerns about Wal-Mart. However, there are 2 sides to every story. Take a look at this link for some of the other side:
http://hispanicpundit.com/category/economics/wal-mart/
Thanks for the link, David. I continue to have mixed feelings about Wal-Mart, because I do understand the economic good they do. I was amazed by how many universities have studied the so-called “Wal-Mart Effect” (see the Wikipedia link above).
It’s kind of a moot point for me personally, because Wal-Mart is so far away from where I live. It’s a hassle to go there, so I don’t, and it’s easy for me to claim the moral high ground by simply going to more convenient stores.
Hopefully people will think, though, and make more informed decisions. Thanks again for the link.
David-
After following the link in your most recent post in the Wal-Mart category, I should point out that the Cato Institute receives significant funding from the Waltons :).
Glad to hear theres another family that wont be buying into the Walmart Sham. My wife and I fought against a WM being put just 1 1/2 miles from our house. We still shop at our local Safeway.
Yeah, our grocery bill do average about $30 dollars more (we did figure that out), but peace of mind is worth the loss in savings for us.
Justin,
Sorry…didn’t research for full disclosure on the link. Just went for the quickest somewhat comprehensive site on the subject that I could lay hands on.
Thanks for your first response. I wasn’t sure if I would just come across as a walmart hack. I do truly have mixed feelings about walmart but lean toward the apparent fact that the low prices they drive do actually raise many Americans standard of living by enabling them to have things that in the world of small, locally-owned shops would be too expensive.
That being said, I’m blessed with a career that makes it possible to avoid walmart and do all the other things in “Crunchy Cons” by Rod Dreher. http://www.amazon.com/gp/product/1400050642/sr=8-1/qid=1156366914/ref=pd_bbs_1/002-2906768-7476852?ie=UTF8
I think it is wise to avoid making major blanket decisions and statements based on propoganda films for one side or the other.
Will-
I agree, but sometimes the facts are so egregious that it’s worth making a decision that ultimately is in agreement with a propaganda film. Of course, I agree with you and David that it’s important to hear from both sides. Wikipedia has a separate article on criticism of Wal-Mart, which is worth a read.
I’m not a big person on banning stores for myself to go to. I don’t regularly go to Wal-Mart because it is a hassle. There’s so many people and parking is crazy. For us, we’ve found that our grocery store is cheaper than Wal-Mart, had a wider variety of things, and has more fresh meats. I do still go to Wal-Mart if I need something and I don’t want to drive all the way across town. And for bird food. Wal-Mart is the only place I’ve found that sells the bird food that my bird likes. Speaking of which, I need some more pretty soon. Wal-Mart also has smarties…Hy-Vee doesn’t. I’m not pro-Walmart, I’m not con-Walmart. Just don’t judge me for the shopping I do do there.
Just a theory, but it seems highly likely that Walmart is the Mark of the Beast. Revelation 13:17 -
“And that no man might buy or sell, save he that had the mark …”
Lots of people only ever buy from Walmart. In fact, the Greek for “the mark” is “charagma”, which kind of sounds like Walmart. Charagma … charagmaRT … WaragamaRT
… Walmart.
Furthermore, Walton has 6 letters in it. Say Walton 3 times and you get 666.
Need I say more.
I see your points about wal-mart, but when you have three mouths to feed including your own, and you are the only source of income. Need i say more. You gotta make them pennies worth their money. When you gotta scrape by, whatever savings you can manage will be there. Where you can spend 30 more bucks there, which in fact that money needs to cover your gas to get to work for the week. There will be pros and cons of businesses. But where i come from. You better think smart or you’ll end up elsewhere.
humm ~ i could wax on and on about this but i won’t . . . my family owns and operates a small independent bookstore . . . i don’t nor can i buy books and bibles by the train load . . . i don’t have 15% of the american retail market . . . we are not the nations largest employer . . . nor do we have publishers who provide inventory on our shelves and we pay for that inventory AFTER it has been sold . . . we pay first (and own) then try and sell the products . . . but tell that to the person who comes into our store to buy “Purpose Driven Life” (ugh . . . i had to spit sorry) and they want to know why my book is a dollar more than wal-mart . . .
humm . . . yeah, that’s a good question!! i wonder about that too . . .
Good points all around. I will reiterate that I think those who can afford to shop elsewhere should avoid Wal-Mart. Those who are just scraping by should take advantage of the low prices, and I won’t think bad thoughts about them.
Wal-Mart is doing a good thing by offering low prices for families that need them. The problem is that so many people are taking advantage of these low prices that all the negatives of the “Wal-Mart Effect” are manifested, which would not happen if middle-class people shopped at more socially responsible stores.
No comment.
That sounds like a pretty good place to be, Justin.
I love Wal-Mart, I really do, hey, its the capitalist society we live in, right? Anyhow, people are just looking for a fight. Compare Wal-Mart to K-Mart, Bosco’s, Sears, J.C Penny’s and the like, and you won’t see much difference. There ARE higher paying jobs out there then Wal-Mart, do not complain if you have chosen to work there, there are better jobs out there that do not require a higher education.
JP-
Does it really make sense to blame the people who have “chosen” to work at Wal-Mart? If they had better-paying options available to them, why would they still be working there?
Most Wal-Mart employees do not have the luxury of finding another job. Wal-Mart is often the only employer hiring in an area, and they use this to their benefit. Why are employees afraid of getting caught trying to unionize? Because they don’t have other options.
I will not go into the stats, because I am not an expert on this, but there has been a significant amount of research to show that, in fact, Wal-Mart is worse in many ways than the other companies you listed. I’m sure none of them pay especially well, but Wal-Mart’s tactics extend far beyond offering low pay.
I, at one time, was one of those people. I was struggling to get by working at Boston Market. Justin, you said “If they had better-paying options available to them, why would they still be working there?” Comfortability, laziness?, I dunno. There ARE better paying jobs out there. When I came to my senses and realized that working at Boston Market wasn’t even paying for the gas in my car, I went to a job agency and landed a decent job (at the time) working as a quality control inspector making much more money. I feel for some of those people but if they are not making ends meat then its time to actually look elsewhere. Believe it or not, there is a job to be had out there.
JP-
This proves the point better than you might realize. If you were qualified for a job as a QC inspector, of course it’d make sense for you to leave Wal-Mart and take the higher-paying job. You were overqualified for the W-M job, and it was silly to stay once you saw the other option.
How many of your co-workers at Wal-Mart, though, would have been qualified for that QC job? You have a computer and read blogs, which tells me something about your technical skills and social class. The people who are truly stuck in dead-end, low-wage jobs are stuck not because they’re stupid and it never occurs to them to find a better job, but because there are so few other jobs for which they would be qualified.
For a long time, my attitude toward low-wage jobs was along these lines: “If they don’t like having a crappy job, they should find a better one, or go back to school so they can.” Even assuming it’s possible for everyone to go to school and find better work, most people cannot afford to simply quit what they’re doing and go back to school, because this would leave them with no way to support their families.
Justin, believe me brother, I am more on your side then the other. My job as a quality control inspector (which was 8yrs ago) had nothing to do with qualification. It required NO background qualifications, they trained, you just had to show up. I feel so bad for those who are stuck at Wal-Mart to no fault of their own, just the cards, unfortuantely they have been dealt. However, look hard enough, connect with a job agency, and they maybe surprised.
I still fail to see why Wal Mart is “evil” because it pays low wages, and enlists the Chinese workforce.
Is it Wal-Mart’s (or any business’) duty to make sure every employee has a comfortable life, no matter what the job?
I don’t agree. Please enlighten me.
Andy-
I think it comes down to what kind of society we want to have.
Do we want to be a country where some people can own their homes and drive two cars and get health insurance, while other people have to choose whether to pay the bills or to buy groceries?
I’m not saying every job should pay $20 an hour, but if a person is working full-time at the best job they’re qualified for, they should not fall below the poverty line. As a society, we have decided (by our failure to construct any other type of system) that some people should have their basic needs met while others will not.
I have mixed feelings about this from a philosophical point of view. Middle- and upper-class people know, almost from birth, what it takes to succeed and have, as Andy said, a comfortable life. I knew when I was 10 that I needed to work toward buying a house if I wanted to prosper. I knew when I was fifteen that I needed to build a credit history by (carefully) using credit cards and a checking account. I knew when I was 5 that I needed to go to college, and major in something useful in today’s economy.
People who start at the socioeconomic bottom do not have the benefit of this knowledge, because the people around them do not know, in specific terms, how to be prosperous. They might hear generalities like “go to college and get a good job,” but those of us who have done that know that a lot goes into going to college and getting a good job. It’s hard, and complicated, and you have to know how the system works to make it work in your favor.
From the middle-class perspective, not doing what it takes seems stupid, because we know what it takes, and we assume everyone else does. But that isn’t the case, and we don’t understand the obstacles people face even when they do know what to do.
On the other hand, some people (not most, and certainly not all) are poor because they make stupid decisions. What we need to remember, though, is that society pays in other ways if we fail to provide safety nets. We can provide education and social services now, or fund prisons later. We absolutely must break the generational cycle of poverty, so that one generation’s state is not the destiny of the next generation.
</caffeine-induced rant>
Justin,
I agree with you on helping maintain a certain standard of living in our society. But again, why attack WalMart? What about McDonalds, the local mom n’ pop grocer, or the jobs down at ‘the docks’? I think people point fingers at WalMart because they are an easy target.
It’s not WalMart’s responsibility to provide America’s “safety net”. Keep in mind, our government already provides this…. minimum wage, food stamps, and other welfare. Perhaps your argument should be for a higher minimum wage instead of harrassing a law-abiding businesses.
Andy-
Those are great questions, which the film addresses at length. For one, Wal-Mart has not been a consistently law-abiding company. It undertook systematic efforts to coerce employees into working extra hours off the clock, among other things.
There is a growing consensus that large companies do have certain obligations to do good for society. Wal-Mart is enormous and massively profitable, yet provides dismal wages and benefits. Since they offer the lowest prices on consumer goods in most areas, Wal-Mart makes it difficult for any employer in the industry to provide good wages and benefits and still remain viable.
Costco, on the other hand, is very similar to Sam’s Club, yet pays its workers 65% more on average than Wal-Mart, while earning more profits per employee. When Wal-Mart refuses to offer decent compensation, it pushes down wages for the entire industry, so that none of its competitors can pay any more, or they will not be able to compete with Wal-Mart’s low prices (not that they could anyway). Costco is more expensive, but it’s a better company.
Minimum wage is an inadequate safety net, and I agree that raising it is a bigger and more important issue than one company’s social responsibility. Even if people did have infinite social mobility, we are still going to have millions of people working in these low-wage jobs and, consequently, living in poverty.
I don’t have any hard data, but McD’s pays about $9 an hour here. It’s not a great living wage, but you won’t make that in most jobs at Wal-Mart in any part of the country.
Why do big companies have a greater obligation to be socially responsible? There’s the wage pressure issue I already mentioned. There’s the tax breaks they get. There’s the economies of scale that mom ‘n pop stores can’t achieve. There’s the obscene salaries their executives take in relative to their workers. The list goes on.
Also, McDonald’s employs very few people, and probably pays them well. Most McD’s employees are technically employed by McD franchisees, whereas Wal-Mart is a single company that employs 1.6 million people.
It also occurs to me that fully employed people should not need food stamps, welfare, and other safety nets in order to stay out of poverty. That’s messed up - we really do need a higher minimum wage.
[...] Let me preface this post by saying that I am usually not too impressed with Wal-Mart. I think that their lowest-price-at-any-cost strategy is not the best long-range plan in terms of caring for our Earth and its inhabitants. The Wal-Mart news of the day is about their new super-low priced generic drug program. The news article points out that Wal-Mart’s health insurance plan has come under fire because it has a $1,000 deductible for individuals and $3,000 deductible for families. And people think this is bad? Are you kidding me? Obviously people have lost sight of the fact that insurance is an aleatory contract. It was never designed to cover every sniffle, sneeze, and hangnail. People need to take some responsibility for their own basic health, and realize that if they know they’ll go to the doctor 3 or 4 times a year, that’s not something that insurance was ever supposed to cover - BECAUSE THEY KNOW THEY’RE GOING TO BE NEEDING IT. Insurance is supposed to cover the things that we don’t expect. Things like cancer, car accidents, heart attacks, appendicitis… Small medical expenses (under $1000 is a good example of small when it comes to medical bills) are something that we expect to have, so we should expect to pay for them. Wal-Mart’s main health insurance flaw - in my opinion - is how few of their employees qualify for benefits. Wal-Mart encourages its employees to apply for welfare and Medicaid rather than provide adequate and affordable coverage. CEO Lee Scott said “In some of our states, the public program may actually be a better value.” The vast majority of workers qualify for public assistance, which costs the state of California over $75 million a year - just for Wal-Mart employees who do not receive adequate benefits. [...]