I’m honestly baffled by multiple folks continuing to describe a food drive as “Walmart asking their poor workers to give stuff up”.
I mean, christ, it’s a food drive for God’s sake. Organizing a food drive is a charitable act, not an exploitative one. How can you not understand this? Do you even know what a food drive is?
The article (nice headline by the way :) ) seems more about urban sprawl than about Wal-Mart. Downtowns are dying all over the country, but you can’t blame that on Wal-Mart anymore than on the malls that have been built over the last 30 years.
And they look at tax revenue PER ACRE for their metric? Man, towns must hate small farmers then. Farmer Bob and his 3 sons work 40 acres by themselves! That’s only .1 jobs per acre! Terrible!
Talk about picking your metrics to suit your argument. They must think the people reading that article are pretty dumb.
Have to agree with this. I’m fairly anti-Wal-Mart, but at the end of the day the article is comparing apples to oranges. They’re comparing a 6-story building with no parking lot to a “sprawling Wal-Mart” with a full-sized parking lot. Of course the density between the two is going to be different.
Considering the JCPenny building is 6 stories and the Wal-Mart is 1 story, it’s not surprising that the dollar-per-acre is roughly 1/6. Also, comparing “job density” doesn’t make much sense either. The Wal-Mart employs ~180 employees while the JCPenny building employs 14. Would you rather have a small building employing 14 people or a large one employing 180+? If the argument is that if the Wal-Mart was gone, their acreage would be taken up by better employers, I can see that argument, but it doesn’t sound like there’s a huge line of companies just wishing there was space available in downtown Asheville.
If you want to judge a business based on employees per acre, I would think every city would want as many call centers as possible.
Now do I wish Wal-Mart paid their employees better? Heck yes I do. But it is the way it is now. Without the government stepping in and raising the minimum wage, you’re always going to have a race-to-the-bottom situation with retail. Wal-Mart pays the least they can so they can keep their prices low. Low prices attract customers. More customers + low prices = success. If Wal-Mart were to willy-nilly raise their wages 50%, they would have to increase their prices, likely above places like Target. So to say raising wages would “just” lower Wal-Marts profits from 15 billion to 8 billion is incorrect. If they price themselves out of the market, they’ll destroy their own business. Another business will just fill that gap (Dollar General, Big Lots, some other low pay/low price store).
Wal-Mart fills a niche in the economic ecosystem. Like any ecosystem, if that niche is vacated, someone else will evolve to fill it.
It’s hard to get credit for organizing a food drive when you are seen as why the food drive is needed in the first place. Harder still when you are sitting on unimaginably huge piles of food yourself, figuratively speaking.
“C’mon guys, you’re all in this together!”
No, they wouldn’t. That’s the point. The wage increases can come out of corporate profits without affecting prices. Your argument only makes sense if they have zero net profit.
The issue isn’t low retail prices, it’s that the gross profit (revenue less cost of goods, before employee wages) is increasing divided up in favor of management and shareholders at the expense of labor. That’s been the trend since the mid-70’s.
Case in point, Costco has prices that are lower than Wal-mart, and pays its employees much better. So your thesis that they’d “price themselves out of the market” if they raised wages is false.
Costco and Wal-Mart use different business models. You’d be better off comparing Costco to Sams (owned by Wal-Mart).
No board of directors is ever going to let a company lower its profit by $7 billion year-over-year. If the C-level were to do that, you’d end up with a massive house cleaning and change in management. The only choice Wal-Mart would have if they raised their pay would be to raise their prices to maintain profits.
Idealistically you can look at it and say that all companies should follow Henry Ford’s “make the best quality goods possible at the lowest cost possible while paying the highest wage possible” philosophy. I honestly wish that was how the world worked…but it doesn’t. Investment money will flow to whatever company maximizes profit margins. In order for Wal-Mart to keep its investors, it either needs to continue with its current business model or go private where it won’t be at the will of the investor class.
I can’t tell if you simply failed to read the article or you’re being deliberately disingenuous; but it’s a food drive for its own employees.
How is this anything but an implicit acknowledgement that Wal-Mart doesn’t pay some of its own employees enough to buy their own damn food from Wal-Mart itself? And how many Wal-Mart stores don’t even do this much to help out their employees?
Exploitative labor markets are not simply the “price of doing business” in a capitalist economy. What’s next, a return to sharecropping?
By my estimate, Wal-Mart could afford to pay its 2.2M employees an average of $150 extra per month and still post ~$11.75B in profits. $300 extra per month and it goes down to $7.8B.
I dunno, maybe I just don’t have a head for corporate profits, but that still seems like a lot of billions to me.
So you’re saying conditions can never change? Don’t even bother trying?
It’s a pretty amazing PR job the rich have done to convince a broad swathe of the populace that current market and regulatory conditions are immutable laws of economics. The working class using the tools available to them to influence public policy and opinion are always illegitimate and/or unworkable.
There is a very easy solution to this. If you don’t agree with Walmart’s policies, stop shopping at Walmart, and convince everyone else to follow your lead.
That will never happen though. People don’t care if they use tiny orphan children to sew their shirts and pay their cashiers crap. It’s those same people who don’t care that shop there. They are their own problem. It’s an object lesson in a living wage, is it not? It’s the prices, man! The low low prices!
Convince people to pay more for the same goods and the problem will solve itself. Good lucking fighting organic capitalism, though. And low low prices.
The point remains the same: there isn’t actually a hard link between prices and wages, as you contended. The “we’d have to raise prices if we raised wages” argument, which you see over and over in all industries, pretends that there’s zero corporate profit. The reality is that it’s not about prices, it’s about how gross profits are divided.
Unless, of course, the board of directors were on board with the idea of improving wages. While most boards are entirely about profit above all else, this is not always true.
As a practical matter, this is the sort of change you’d introduce gradually, to avoid such an abrupt change.
Several issues here.
First, Wal-mart is effectively privately owned. The Waltons own 51% of the shares outstanding. This isn’t almost faceless shareholders, this is about the Waltons.
Public companies aren’t at the mercy of the investor class. Once they have sold the initial shares, stock price has no direct effect on a company unless they issue a secondary offering. In theory you can have a shareholder uprising if the board does something grossly crazy, but in practice it’s unheard of. I own quite a lot of stock, and of course I see lots of shareholder proposals in the annual reports, and I don’t think I’ve ever seen one pass.
CostCo is a public company. If investors always forced companies to pay starvation wages, this would have happened to CostCo a long time ago. In practice, shareholders give their companies a lot of leeway. You’d think that they’d punish a company like CostCo and reward Wal-Mart since they’re getting a smaller slice of the pie, but in fact the price / sales ratios for both stocks is nearly the same (about 0.5). In fact, CostCo’s P/E is 26 to WMT’s 15, which indicates shareholders are willing to pay more for a dollar of earnings from COST than from WMT. These are of course crude valuation metrics, but WMT’s profit margin is about 50% higher than COST’s, and I imagine wages have a lot to do with that.
I don’t shop at Wal-mart. However, this isn’t really a solution, as any familiarity with history will demonstrate. Aside from the rare occasions when a company voluntarily does right by its workers, the only solutions that work are government ones. This is why we have child labor laws and the minimum wage. Abolish those - and there are people who regularly argue we should abolish wage laws, at least - and we’d slide back into a late 19th century economy.
In March of 2012, there were 3029 Supercenters (Walmart - Wikipedia). Walmart paid somewhere between 4.6 (10 Most Profitable U.S. Corporations Paid Average Tax Rate Of Just 9 Percent Last Year: Report | HuffPost Impact) and 6 (Walmart Inc. (NYSE:WMT) | Income Taxes) billion dollars in taxes. That comes out to between 1.5-2M in taxes per Supercenter, but it some amount lower because the $4.6-8B includes taxes paid from non-supercenters (regular Walmarts and Sam’s Clubs). I also don’t fully understand the third link, so I think that $6B might be too high. State and local taxes were only $743M.
Because Wal-Mart is the one who pays low wages and makes enormous profits. That is, Wal-Mart is at least partially responsible for the need for an employee food drive to begin with as well as the one in a position to help, on multiple fronts. At the very least they could provide matching donations or something (I don’t recall seeing any mention of that in the article, in any case).
There’s nothing particularly charitable about saying “Dear employees that we pay poorly, please give food to your co-workers who are also underpaid and can’t eat”. A charitable act would be Wal-Mart donating part of those profits to employees in need, either via an assistance program or by raising wages.
Some (a few) companies like Costco believe that a happy workforce is actually good for business. Most companies believe “screw everyone, starting with the poors who work here.”
Some folks can’t afford to have morals when they shop- morals won’t fill your kid’s belly. I personally avoid shopping there as much as possible- but I’m not going to look down on folks who have to because they lack the ability to choose something better.
Or indeed if they lack a choice at all.
But how is that BAD? It’s still a charitable act.
You seem to be blaming Walmart for not paying them enough, and then irrationally transferring that blame to try and complain about the management of a specific Walmart holding a food drive for those people, which is nonsensical.
Especially since it’s not really “Walmart” which is doing it, but rather the managers for that specific branch, who aren’t crazy high up executives in the corporation. They aren’t able to revamp the Walmart wage schedules. They aren’t able to have Walmart just pay for stuff.
What they are able to do, is hold a food drive to try and help their employees who need it… And you are somehow saying that is bad, which is totally insane.
There’s definitely confusion about the actions of WALMART (corporate) vs. the actions of a particular Walmart (a branch).
A lot of people seem to be assuming that this was a program instituted at the corporate level, presumably taking some non-trivial amount of resources to co-ordinate. That would be rather unseemly, because it would be a) a tacit admission from corporate Walmart that their wages are too low, and b) any money that was spend organizing could (should) just have been given directly back to the employees in the form of wages.
However, this doesn’t seem to be the case. This seems to be an individual branch manager trying to do right by his people.
On a mostly unrelated note, I find the fake-corporate-charity-PR stuff to be highly distasteful. Shit like the NFL donating money to Veterans organizations for every touchdown scored (there’s clearly a pre-computed cap, so just donate that amount, assholes), or the stupid yogurt-lid breast cancer donations (don’t make me return the stupid lid, if you want to actually donate 10 cents per yogurt, just donate the damn money).
I like this thread. It’s nice to see everyone’s MBAs not going to waste.