February 8, 2006

Published in Wake Forest, NC

            You may have seen excerpts from the book describing how Wal-Mart can sell salmon for $4.84 a pound. It is done – and Fishman is clear that Wal-Mart does not dictate the methods, only that the cost is kept excruciatingly low – by factory-farming Atlantic salmon in huge pens in the bays and fiords of the Pacific Ocean along the southern coast of Chile. The fecal matter and uneaten, antiobiotic-treated food drops to the sea floor, creating a dead zone.

            In the book, Fishman details how Wal-Mart has and is reshaping the economic life of this country and countries around the world with its insistence on low prices this year, lower prices next year.

            He refers to the multiple lawsuits about wages, sex discrimination and unfair labor practices the company is battling.

            Fishman notes that a great many Wal-Mart employees cannot afford or are not eligible for the health insurance the company offers – those working fewer than 34 hours a week (the standard at Wal-Mart for full-time employees) must wait two years to be eligible and then can only buy it for themselves, not their families.

            The result? In many states, and perhaps in all once states examine their statistics, taxpayers foot the health-care bill for many Wal-Mart employees and their families. Other companies – retailers, grocers, fast-food chains – also rely on the state-run Medicaid programs, but in all the states who have reported so far Wal-Mart tops the list. And if you work only 34 hours a week at even $10 an hour, it is difficult to afford rent or mortgage, car payments, food and clothing, even if you shop at Wal-Mart.

            Fishman also details how Wal-Mart’s insistence on low prices has gutted some companies such as Vlasic, the pickle-maker, and the L.R. Nelson sprinkler company. Nelson made lawn sprinklers in Peoria, Ill., beginning in 1911, making them from metal and other substantial materials. When Nelson became a Wal-Mart supplier, the necessity to lower the cost each year led to continuous drops in quality. Nelson remains a company, but mostly to coordinate shipments from China. “Wal-Mart has said that they would love to buy from us because some of the production is done in the United States, but the cost differential is so great that they told us that unless we supply them out of China, we couldn’t do business,” the Nelson president said in 2005 as he laid off almost all his factory workers.

            But what Fishman missed because it has happened since his book was written is Wal-Mart’s forays into new markets and endeavors such as neighborhood and convenience-store markets and banking.

            We know that Wal-Mart was mentioned as a contributing factor in the bankruptcy proceedings for Winn-Dixie and 25 of the supermarket chains in the past decade. Wal-Mart is being cited as a major reason for the demise of hundreds of independent Christian bookstores.

            But did you know that Wal-Mart is now opening Neighborhood Markets, small grocery stores that include a deli, a drive-through pharmacy – even gas in some locations, pitting the stores against convenience stores like 7-Eleven. There will soon be six Neighborhood Markets in central Florida, and Wal-Mart is planning them in three other states. In 2004, Wal-Mart had sales of $109 billion in food and drug sales, making it the largest grocer in the country.

            And you almost certainly did not know that Wal-Mart has applied for a bank charter in Utah. Alan Greenspan, who just stepped down as chairman of the Federal Reserve System, sent a letter to Congress in January opposing the approval of that application because such banks, also known as industrial loan corporations, are not subject to the same regulations as most banks.

            As Wal-Mart burrows into more and more aspects of our national life, it may be time to ask: What is the cost of “Always low prices. Always?” We cannot blame Wal-Mart for U.S. factories that are now located in China or Albania, but the company has helped accelerate the process. (Two of the three industries in Wake Forest closed because of a combination of corporate moves to Canada or Mexico and old factories, and the third was strangled by poor management.)

            But we can ask if we want Wal-Mart running most neighborhood grocery and convenience stores, becoming the largest banker in the country and continuing to claim there is no relationship between its corporate practices and pollution in Chile, high Medicaid bills for taxpayers, companies that have been ruined and employees who only work 34 hours a week on the clock but several others off the clock.

            I suggest you read the book, look at the web site, look at Wal-Mart’s web site and check your own values before you shop at Wal-Mart again.