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Is the New Walmart New Enough?

A Commentary By Froma Harrop

Thursday, April 28, 2011

I found this quote, buried in a news story about rising prices in China:  

"I hear that many Chinese exporters are rejecting orders from Walmart and other Western retailers," said Dong Tao, an economist for Credit Suisse in Hong Kong. "I've been covering the Chinese economy for a long time, and I've never heard that before."  

Seems that inflation and Beijing's efforts to raise the country's pitifully low wages are making Chinese goods too expensive for the likes of Walmart. The giant discount chain is now seeking lower-cost suppliers where workers toil for even less.  

Many Americans, having watched millions of their factory jobs shipped to China, may find some poetic justice in seeing the people who took their livelihood threatened by still cheaper workforces. No one shall ever pay more than $8.99 for pajamas, the iron law of "Every Day Low Prices" would hold.  

Walmart's famous aversion to sharing its vast revenues with the factory and retail hands who make them possible has not exactly turned the discounter into America's corporate sweetheart. True, the company has improved store worker compensation in recent years. Also true, it has done great environmental good, reducing the use of plastics and energy.  

But a residing bad taste helps explain why New York City has yet to permit a single Walmart store, even though the big boxes of Costco, Target and others landed there long ago. It explains why activists continue to fight Walmart's plans to expand in Washington, D.C., Chicago and elsewhere.    

The corporation's standing as chief despoiler of the American countryside also has not made it friends. The big, ugly boxes plopped in the middle of vast parking fields have blighted many a pastoral landscape. At night, the parking lots are flooded with such harsh light that neighbors can't see stars for 5 miles around.  

Furthermore, the discounter tends to put its butt right outside older downtowns, bankrupting the local shopkeepers who sponsored Little League teams and generally treated their staff better. Urban America doesn't want its intimate cityscapes cannibalized by soulless warehouse stores.  

Some say the smaller retailers just don't want the competition of lower prices. This would be true. But if competition means killing off Main Street -- while moving jobs from Ohio to China and down the labor food chain to the dingiest sweatshop in Asia -- is competition all it's chalked up to be?  

The chain's defenders argue that by keeping costs low, Walmart helps American workers stretch their paycheck. I'd argue that without Walmart, American workers would have more of a paycheck to stretch.  

A new study at the University of California Berkeley concludes that Walmart could set a minimum wage of $12 an hour for its store workers without greatly hiking prices. Poor and low-income employees, many making less than $9 an hour, would greatly benefit, according to Berkeley's Center for Labor Research and Education. Meanwhile, the average Walmart shopper (who spends $1,187 per year at the chain) would see the annual Walmart bill rise only $12.49.  

We are assuming, of course, that higher prices would cover all the pay increases. I have another idea.    

Four heirs of Walmart founder Sam Walton sit on the Forbes 2011 list of the 10 richest Americans. Their combined wealth approaches $84 billion, not including lesser Waltons worth only $3 billion here, $1.5 billion there.  

Sam could have left generations of descendants unimaginably rich without having to pauperize workers around the world. The guy who ran the boarded-up fish tackle shop downtown would have been ashamed of such stinginess.  

Yes, the surviving local family store still has our love. It needs our patronage, as well.  

COPYRIGHT 2011 THE PROVIDENCE JOURNAL CO.

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