Dear Reader

“The High Cost of Low Price”(A)

The New England town where I spent my first 17 years has only a few more people now than it did when Wal-Mart opened its first store. There were about 1600 people then and there are about 2000 people now, though those who live in this picturesque village these days are more likely to be artists than farmers. Neighboring Greenfield, Massachusetts, became famous in 1993 because it was one of the first towns in the country to keep Wal-Mart out. Locally-owned stores I frequented before Wal-Mart was invented still thrive on tree-lined Main Street. Would that be true had Wal-Mart set up shop on the outskirts of town?
Wal-Mart has mushroomed into a social and environmental force to be reckoned with around the world since I left rural New England, and many people see that force as negative, but the company seems not to fully understand or take responsibility for its impact. Since the first Wal-Mart was built in 1962, the company has grown to 5000 stores worldwide employing 1.3 million “associates”. More than 138 million customers per week visit Wal-Mart stores worldwide. Just about everyone in the U.S. is aware of this, thanks to equal rights and environmental activists and a recently released movie called “The High Cost of Low Price”. As of November 22, 2005, a 66% majority of the 4,432 readers polled in the on-line environmental newsletter, Daily Grist, “wouldn’t set foot in that lair of Beelzebub”. Wal-Mart’s management has been very slow to acknowledge the downside of being the world’s largest company as they cling to the business model developed by Sam Walton forty three years ago.
The issues around Wal-Mart extend well beyond the Main Streets of America. Most of the 1.3 million “associates” are not well paid and have poor health benefits, throwing the cost of health care back on local governments. Many qualify for food stamps, and charges of discrimination abound. In response to increasingly rancorous attacks, Wal-Mart released a speech by CEO Lee Scott (total compensation over $20 million) in late October. This speech outlined aggressive measures toward “Sustainablility”. From an Environmentalist’s point of view, the speech was very impressive. But only hours later, an internal memo written by the human resources folks at Wal-Mart undid the public relations gains of the Scott speech. The writer(s) suggested that Wal-Mart might change the demographic of its aging associates by requiring everyone in the store to gather carts from the parking lot. It’s not hard to conjure images of portly elderly cashiers huffing and puffing as they wrestle rattling carts through rain and sleet and snow.
Wal-Mart might seem to some like the lair of the devil, but it’s more likely a wildly successful, pure capitalist enterprise that has yet to see its true huge self in the context of society and the environment. Given the stakes, those of us who are interested in the welfare of ordinary working people or the environment should stay tuned and stay engaged. Sometimes things do change for the better sometimes, after all.