"Mixed Feelings” may be the quintessential expression to describe the United States largest retailer, Wal-Mart. Economist's marvel at the corporation’s rags to riches success knowing full well the collateral damage it collected in the process. Everyday shoppers secretly drool over the stores unbeatable low prices while simultaneously feeling enraged by their monopoly over other Americans businesses.
In the American free market economy the reality is that Wal-Mart trumps all corporations in the commerce rat race we call capitalism. Wal-Mart’s cut throat marketing schemes reflect the practices of capitalism at its finest, revealing the paradoxical values upon which the American culture has been traditionally embedded. The question of whether or not Wal-Mart is good for America is no longer the question. The question should be, is this new form of capitalism eroding American values?
According to Fortune Global 500’s 2009 ranking of the World’s largest corporations, Wal-Mart sits strongly in 2nd place beneath its superior competitor, Exxon Mobil with a total of 405, 607 billion dollars in yearly sales.
The success of this retail giant can be contextualized perfectly by an economic concept first coined by Economist Joseph Schumpeter called “creative destruction.” This term refers to a company’s ability to revolutionize the system of capitalism through radical innovation, destroying older systems of commerce and implementing new ones, which then dominate an industry. For example, the Polaroid Corporation revolutionized the photography industry with the innovation of instant cameras just as the Xerox Corporation cornered the copying industry via the first photocopier.
Wal-Mart’s “creative destruction” instincts rest in their efficient utilization of a low price model, the global economy and logistical telecommunication systems, which gave them the power to reverse the traditional marketing system from “push” to “pull” production. Before the rein of Wal-Mart, retailers worked within the “push” marketing system whereby manufacturers promote their product to the retailers, deciding what they’re going to produce and then bargaining with the retailers to buy the product and sell it for them.
In the early 1990’s Wal-Mart reversed this feudal relationship. The new “pull” system involved the retailer telling the manufacturer what is being produced and when to produce it based on what is actually being sold. By utilizing technology to calculate commerce logistically, Wal-Mart was able to efficiently and accurately track consumer demand. Now manufacturers sit naked as Wal-Mart’s swift retailers dictate a precise estimate of what they need produced, under what price, when and where. This system not only changed the face of capitalism, it granted Wal-Mart the power to determine the fate of a company.
Rubbermaid is an example of an American company in Wooster, Ohio manipulated by Wal-Mart’s “pull” system. When the price of resin, a raw material essential to the manufacturing of rubber, increased substantially Rubbermaid urged their number one retailer, Wal-Mart to increase the price of their products, an offer that clashed with their low price standard. Incidentally “Wal-Mart promptly dropped a number of Rubbermaid products and replaced them with goods molded by such competitors as Sterilite.”These days Rubbermaid has become a company struggling to stay afloat after Wal-Mart pulled their items from the shelves in 1995 devastating the future of the company and the workers in the years to come. According to the Public Broadcasting Service (PBS) documentary Is Wal-Mart Good For America? Rubbermaid’s earnings immediately dropped 30 percent and they were forced to sell to the Atlanta based company Newell. In 2003, the factory in Wooster was closed and 850 factory jobs were lost.
This is just one of the horror stories that vindicate Wal-Mart as an unpatriotic corporation that destroys American life, all the while neglecting the apparent irony behind the situation. This corporation’s success is rooted in the very nature of capitalism. Older companies are replaced by newer ones whose innovative marketing strategies corner the industry. If anything Wal-Mart is a glorified example of the American Dream.
Still, even these initial aggressive technological innovations could not fully satisfy the consumer demand for “always low prices.” Wal-Mart Entrepreneurs needed an easier gateway to increase their profits, and that gateway happened to be overseas in countries like China, where “sweat shops” continue grow like weeds. In fact most American consumerism relies heavily upon outsourcing goods and resources from Asian countries whose labor laws are incredibly loose and whose workforce are underpaid.
The exploitative relationship which advocates that cheap help equals cheap goods is diffidently not a marketing theory implemented by Wal-Mart Entrepreneurs, yet their participation negatively reflects the values of the American egocentric economy. As of November 2009 Vanity Fair and 60 Minutes conducted a poll by Americans regarding what they think Best Symbolizes America Today considering the recent economic crisis. The poll concluded that 48 percent of men and women agreed that Wal-Mart best symbolized America.
Truly nothing represents the American culture more accurately than the yellow smiley face, not even the eagle – probably because the patriotic bird gets mistaken for the retailer, American eagle outfitters. Nevertheless the message now reads: United we stand, divided we make other countries fall.
While outsourcing sufficiently lowers inflation in America, it is fueled by millions of disadvantaged workers in foreign countries. Recent reports conducted by the China Labor Watch (CLW) as of December 1, 2009 indicate that factory conditions “remain devastatingly brutal, characterized by long hours, unsafe workplaces and restricted freedom of association, and are in blatant violation of Chinese and international labor laws.”
Anti-Wal-Mart campaigns such as http://wakeupwalmart.com/ and http://walmartwatch.com/ outline corporation’s failure to balance power with moral responsibility. But what should we really blame, the chicken or the egg, maybe neither.
Technically Wal-Mart is not breaking any moral injustices. The capitalist infrastructure permitted this behavior for decades. General motors, the soul of the early 18th century corporate America found its booming success through its exploitation of American Workers. This is the corporate hegemony professed by the late economic philosopher, Karl Marx.
Today sister corporations mimic Wal-Mart's not so secretive strategies for economic success. Similar to Wal-Mart, Target supports China’s shady trade tactics by importing and stocking their stores with most of their country made products. In other words Wal-Mart is no longer the sole contributor of these vile working conditions.
These corporate leaders harness the vulnerability of the working class, whose minimal skills dictate their low economic value. This is the brute nature of capitalism; this is also the cut throat game which Wal-Mart mastered. Every American that walks through these corporations sliding glass doors supports the company’s dark capital motives.
Anti-Wal-Mart campaigns deliver reasonable vindications but imply inconceivable resolutions. Wal-Mart is not going anywhere, anytime soon. America’s capital economy mirrors a culture that it purports to satisfy. More than ever people are active consumers, so much so that their lives are largely dictated by material possession. Wal-Mart’s slogan “Save more, live better” perfectly captures this ideology. Every day, mesmerizing advertisements encourage Americans to spend, spend, spend and then spend some more.
According to the documentary The Story of Stuff created by the Funders Workgroup for Sustainable Production and Consumption, American’s are targeted by 3,000 advertisements per day. Convenience, low prices and good quality echo the hallmark mantras of American life which Wal-Mart merely supplies. Is the corporation wrong, or have more Americans perpetually taken the bait and fell into the trap of consumerism by buying more than we need?
Take the holiday season. A little over fifty years ago the cultural phenomenon, “Black Friday” did not exist. People spent their holiday weekend socializing with family and friends in a relevant spiritual or thankful celebration for the people and simple wholesome pleasures that enriched their lives. They did not camp outside malls, shops and superstores pining after the latest IPod touch that went on sale by nearly 30 percent its original cost. Unfortunately consumerism has surpassed the questionable phase of habitual shopping rituals to an eerie state of celebrated traditions. Last year, Jdimytai Damour, a Wal-Mart worker from Long Island, New York was trampled to death by a large crowd of eager shoppers on Black Friday. "They were like a stampede," said Nassau Det. Lieutenant Michael Fleming. "Hundreds of people walked past him, over him or around him." At best this “Wal-Market” economy offers a cheap and accessible material world under one superstore. At worst it turns people into cold minded swept zombies.
Professor Paul Ehrlich of Stanford University commented on the consumption of America, from his book, The Population Bomb. Enrlich discovered that Americans account for about five percent of the world’s population and use 24 percent of the World’s resources. This statistic alone establishes that American culture is very driven by consumerism.
Americans cultivate fetishes with their consumer identity, but in doing so they pay little attention to their value as workers. The real tragedy exists when American consumers get exactly what they want, with each purchase increasing the number of workers who posses such little economic value.
It all comes down to the consumer. Corporations like Wal-Mart may be the immaculate beasts many of us supported, but capitalism is not a fixed and stable system. It is shaped by a multiplicity of variables, and the consumer culture is at the center of this existence. We may be strongly influenced by the culture which surrounds us, but it does not dictate our lives. Each individual is endowed with a certain amount of agency to live a life that shadows their own values.
This can be as simple as the consumers conscious decision to pay attention to the amount of goods they are consuming, who produces those goods and under what conditions they are being produced. If corporations such as Wal-Mart support the exploitation of overseas workers, then aggravated individuals should put their values into action. They can begin by deciding to either shop elsewhere or limit their spending.
Additional aims may be to seek out corporations which better reflect a person’s political or moral values. http://www.etsy.com/ is an example of an American online retail exchange that buys and sells handmade items which cover a wide range of product art, photography, clothing, jewelry, edibles, bath & beauty products, and toys. Etsy supports a friendly trade environment whereby all members who join are subjected to strict policies and terms of use, http://www.etsy.com/dosdonts.php which enforce members to treat each other with kindness and respect in all areas of the business. In addition this venue does not support the exploitation of workers, especially in regards to child labor.
For those that continue to feel trapped in the brutal world of consumption the answer is simple. Save. More saving leads to more investment, promoting both economic growth and, yes a better standard of living.
I thought that this column was extremely whitty and interesting. I DO agree, however with what we said in class, that readers might frown upon being told that they "drool," ever if that IS what they do. You might consider usign the phrase "secretly covet these low prices," or "desire these unbelievable prices." I also had a little trouble discerning one, single topic. I felt that your article kind of danced around a few different issues and views. Good job though, this was very well researched and thoguht out.
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