Unions & Liberals Vs. Wal-Mart & American Consumers

by John Hawkins | May 4, 2005 7:19 am

Companies that are unionized are too inefficient to compete with companies that aren’t and liberals are generally hostile to successful businesses. Therefore, it’s no surprise that both unions & liberals detest Wal-Mart.

It’s tempting to simply ignore the kvetching about Wal-Mart because in the long run, consumers don’t care all that much about the whining. It doesn’t matter how many billboards or radio spots the unions run, American shoppers are interested in getting the most bang for their buck and if that’s at Wal-Mart, that’s where they’ll go.

But the unspoken goal here isn’t to influence consumers, it’s to influence government[1] to step in and punish Wal-Mart for being successful. That would make unions happy, because Wal-Mart would be made less competitive and there are few things class warfare loving liberals love better than sticking it to successful businesses.

So let’s take a look at a few select excerpts from this piece in the New York Times:[2]

“With most of Wal-Mart’s workers earning less than $19,000 a year, a number of community groups and lawmakers have recently teamed up with labor unions in mounting an intensive campaign aimed at prodding Wal-Mart into paying its 1.3 million employees higher wages.

…”Wal-Mart should pay people at a minimum enough to go above the U.S. poverty line,” said Andrew Grossman, executive director of Wal-Mart Watch, the coalition of community, environmental and labor groups running the series of ads criticizing Wal-Mart. “A company this big and this wealthy has the ability to pay higher wages.”

Excuse me, but in America, who the hell is Andrew Grossman, the New York Times, or anybody else to arbitrarily demand that Wal-Mart pay their employees enough money? They have no more business telling Wal-Mart what to pay their workers than you, me, or anyone else has telling the New York Times what they have to pay their reporters.

This isn’t a Communist country where the wages are set by some bureaucrat or where people have to work where they’re told. If you work for Wal-Mart & there’s somewhere else out there where you can make more money, you’re absolutely 100% free to try to get hired elsewhere. Nobody gets forced to work at Wal-Mart and no one is forced to stay there.

Which leads to an obvious question: if Wal-Mart employees are really so underpaid, how do they manage to attract and keep a staff? Moreover, explain this quote from the article:

“He said that if Wal-Mart were as greedy as its detractors say, it would never have attracted 8,000 job applicants for 525 places at a new store in Glendale, Ariz., or 3,000 applicants for 300 jobs in outlying Los Angeles.”

Apparently, there are a lot of people out there who are interested in working at Wal-Mart, even at what they pay right now. So why in the world should they raise their salaries?

Here is what it really gets down to:

“Many of those assailing Wal-Mart argue that the company can, and should, pay its workers at least $2 more an hour and add $1 or $2 an hour beyond that to improve its health benefits. A Harvard Business School study found that Wal-Mart paid $3,500 a year for each employee for health care, while the typical American corporation paid $5,600.

If Wal-Mart spent $3.50 an hour more for wages and benefits of its full-time employees, that would cost the company about $6.5 billion a year. At less than 3 percent of its sales in the United States, critics say, Wal-Mart could absorb these costs by slightly raising its prices or accepting somewhat lower profits.

But company executives dismiss such proposals, saying they would largely wipe out Wal-Mart’s profit or its price advantage over competitors. Wal-Mart had a profit margin on sales last year around 3.5 percent. If “we raised prices substantially to fund above-market wages, as some critics urge,” the company argued in a recent two-page ad in The New York Review of Books, “we’d betray our commitment to tens of millions of customers, many of whom struggle to make ends meet.”

As someone who regularly shops at Wal-Mart, let me make something perfectly clear: Wal-mart is not a jobs program, it’s a business — a business that serves people just like me. While I certainly do not begrudge the people who work at Wal-Mart whatever salary they can get (As a matter of fact, my first position out of college in a soft job market was as a Wal-Mart portrait studio photographer), I’m not interested in paying extra money just to pad their pockets, to make liberals happy, or to make life easier for unions. Judging by the success of Wal-Mart as compared to some of their higher priced competitors, I’d say that most Americans agree with me.

  1. influence government: https://rightwingnews.com/archives/week_2005_04_03.PHP#003689
  2. this piece in the New York Times:: http://www.nytimes.com/2005/05/04/business/04wages.html?pagewanted=1

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