2011-12-16 "The Walmartization of America Redux: How the Relentless Drive for Cheap Stuff Undermines Our Economy, Bankrupts Our Soul, and Pillages the Planet" by John Atcheson
John Atcheson's writing has appeared in the New York Times, the
Washington Post, the Baltimore Sun, the San Jose Mercury News, the
Memphis Commercial Appeal, as well as in several wonk journals. He is
the author of a fictional Trilogy that centers on climate change. The
first book will be available on Amazon in January. Atcheson's book
reviews are featured on Climateprogress.org.
If you want to know why the middle class disappeared and where they went, look no further than your local Walmart. People walked in for the low prices, and walked out with a pile of cheap stuff, but in a figurative sense, they left their wages, jobs, and dignity on the cutting room floor of the House of Cheap.
Welcome to the logical end point of Reagonomics. Welcome to Ayn Rand’s nightmare vision of morality, where we know the price of everything but the value of nothing; where predatory behavior is celebrated and the notion of community is blasphemy.
In his excellent documentary, Walmart: The High Cost of Low Price [http://www.walmartmovie.com/], Robert Greenwald carefully documents how Walmart’s giant box stores lower wages across the entire retail sector, impose high social and economic costs on the states and communities in which they operate, and destroy local businesses.
Yet the low prices – which come at such a high cost – are irresistible to American consumers. Walmart has virtually cornered the retail market [http://www.wikinvest.com/stock/Wal-Mart_(WMT] and amassed astounding wealth in the process [http://www.commondreams.org/view/headline/2011/12/09-6].
But it’s not just Walmart. Big box stores now rule across the board in the US retail economy in everything from electronics to pet supplies. And it’s not just retail. The entire US economy is now organized around the notion that getting us cheap stuff – the more the better – is the sine qua non of economic policy.
There was a time when corporations understood that paying their employees a living wage had economic and societal benefits. Henry Ford famously said he wanted his employees to be able to afford to buy the cars they made and launched six decades of prosperity.
The labor movement helped create a social and economic compact in which workers shared the wealth they generated. When workers had enough money to consume, they stimulated economic growth. When production was as important as consumption, the economy flourished, the common worker had dignity, and the means of production were valued.
But that compact has been sacrificed at the Alter of the Cheap, and we no longer produce, we merely consume.
Our main economic activity has become the ceaseless churning and manipulating of the vast capital the old system produced. No value is added, some is skimmed off by the uber rich with each churning. It’s a colossal, self-limiting, Ponzi scheme.
The rich and the corporations have no allegiance to the US or its workers, and so they take the fruits of their skimming and either sit on it, or invest it overseas, where the cheapest goods can be made.
Job creators? Sure. But not good jobs, and not here.
When they’ve skimmed all they can from the US consumer, they’ll focus on the emerging middle class in China, India and elsewhere, leaving us to sit among the decaying detritus of cheap stuff we can no longer afford, searching in vain for the happiness we thought we were buying.
It’s a sprint to the bottom. Lower wages; dangerous working conditions; more pollution; greater liquidation of natural capital; more global warming; less happiness.
Globalization – the handmaiden of Cheap at All Costs – is celebrated as a solution, when it is the problem. And even astute economists seem unable to realize that when another country’s comparative advantage is based on environmental crimes, low pay, and inhuman conditions, then comparative advantage doesn’t operate the way it’s presented in textbooks and abstract econometric models.
Globalization has enabled corporations to leave the old economic compact based on equitably shared wealth behind. For example, in the US, CEO pay is once again soaring, while the average wage earner hasn't kept up with inflation [http://blogs.vancouversun.com/2011/12/15/us-executive-pay-jumps-other-americans-still-looking-for-work/].
Just as Walmart has driven down wages throughout the retail sector, the Doctrine of Cheap has driven down wages for the developed nations, and it will cap them at unjust levels in the developing world.
And the dirty little secret hiding behind the globalization façade is the devastating affect it is having on the environment.
For example, this week, Bejing suffered from air pollution so severe, that the airport was shut down. It’s easy to ignore this kind of environmental insult when it’s “over there.” But the carbon and soot and filth generated in China ultimately reaches us [http://yaleglobal.yale.edu/content/huge-dust-plumes-china-cause-changes-climate].
At the scale of human economic activity we’ve reached, we suffer the environmental consequences of our purchases no matter how cheaply or how far away they are made. In a world were humans have become a global force of nature, “there” is “here.” Climate change is exhibit A in how insults to our commons affect us all.
But the dirtiest little secret of all, is that we – the 99% -- enable this race to the bottom. Our addiction to cheap stuff and our desire for more, more, more is the fuel that feeds this destructive Ponzi scheme.
But there is good news here, too. If we are the enablers of the Walmartization of America, we have the power to change course.
We are the marketplace, and we decide who wins and who loses by where we park our money, what we invest in, what we choose to buy and who we choose to buy it from.
Think about it. We purchase about $80 billion dollars worth of stuff a day, not including what we spend on our homes, cars and normal household bills [http://www.gallup.com/poll/112723/gallup-daily-us-consumer-spending.aspx].
We hold a total of $17.5 trillion in retirement funds [http://www.ici.org/pressroom/news/ret_10_q4] – the single biggest source of money the big banks, Wall Street, fat cats, and assorted other speculators use to play their very own version of hi-risk Texas hold ‘em.
The real power in our economic and political system resides with us, the 99%, if we have but the wit, wisdom and courage to seize it.
So forget Wall Street. Let’s occupy the whole damn marketplace. Let’s vote with our dollars and our values. That’s an election they can’t buy.