Walmart

G.'s post here got me thinking about Walmart a little and the bad rap they get from socially conscious people everywhere. You hear it almost daily, about how bad walmart is, from the size of their buildings and the traffic they generate to how they're responsible for repressed wages country wide. Since my wife is a walmart cheerleader I discussed it a little with her and came to the following conclusion.

Walmart is nothing more than an object for people to dislike and that the problems attributed to walmart are not necessarily their fault. Instead, walmart and its culture are simply an outward expression of bigger, deeper, societal problems. Thus we can blame walmart all we want, but if it wasn't them, it'd be someone else we'd dislike for similar reasons.

The biggest reason walmart gets in trouble is because they sell the lowest prices goods in the market place and they get these lowest price goods by manhandling suppliers to provide them as cheaply as possible. This leads to automation and outsourcing on the supplier side which results in fewer jobs domestically. In addition, walmart keeps their costs of operations low by paying lower wages across the board and maintaining hordes of low cost/high risk part time employees. From an economic business perspective, walmart is brilliant, but it does come at a social cost.

A key question is "but for walmart", would this be the case. Given that retailers are always driving to lower costs it is inevitable that we would have gotten here at some point, it just happens to be walmart that got us here. An even bigger question, though, is why the drive to lower prices? I believe it's the answer to this question that's more important that the effects walmart has on society.

From my perspective, there are two types of people who shop at walmart (actually, there's only one, economically, but I'm going to break them into two separate groups). The first group are those who require the lowest price goods to survive at their income level. This is generally low wage earners who wouldn't be able to afford some of the "necessities" in life if they weren't so cheap at walmart. The second group are people who choose to purchase low priced commodity goods because they have alternate, higher value uses for their incomes than to purchase these types of goods. An example of this would be a middle income family shopping at walmart so that they could make car payment on 2 new cars or to live in a higher value house than might be affordable if commodity goods were higher priced.

Since walmart isn't involved in any of the above decisions, holding them responsible for peoples choices seems off base. The scenarios above show that two of the underlying issues that walmart highlights are the prevalence of low wages and the materialism we have as a society. Unfortunately, walmart chooses to go exacerbate the low wage problem among their workers, but the materialism issue is much bigger than walmart. Given that it's the higher income earners in our society who are complaining about walmart and that these types of income earners tend to be as materialistic or more so than your average consumer, maybe the should be looking at their own behavior and how it affects the marketplace and society as a whole instead of spending all this time and energy bashing walmart.