Posted on 11/05/2005 11:51:05 AM PST by RWR8189
The "rock-bottom" pricing strategy used by retail giant Wal-Mart has filtered into the US economy and kept a lid on inflation, according to a study commissioned by the company and released.
The study by the economic research firm Global Insight concluded that the discounting along with other measures led to cumulative savings for consumers of 263 billion dollars between 1985 and 2004, or 895 dollars per person.
The researchers concluded that Wal-Mart had a positive impact on US employment, generating 210,000 jobs by 2004, or 0.15 percent more that would have existed without Wal-Mart.
The report also found that Wal-Mart's low pay for employees led to a 2.2 percent drop in overall wages across the economy but maintained that this was offset by falling consumer prices.
"Consumers earned less in nominal dollars, but their income bought them more in the economy with Wal-Mart because of real disposable income gains," the study concluded.
The study drew criticism from Wal-Mart's chief detractors, who argue that the company benefits from a variety of public subsidies while depressing wages.
Tracy Sefl, spokeswoman for Wal-Mart Watch, a leading critic of the company, said her group's research, based on data from congressional reports, concludes that Wal-Mart benefits from at least 1.5 billion dollars in public subsidies each year.
Additionally, Sefl noted other reports showing retail workers lost 4.7 billion dollars as a result of depressed wages and that nearly half of the children of Wal-Mart employees qualify for the government's Medicaid health program for the needy.
"Wal-Mart is only telling part of the story, which is not the same as telling the whole story," Sefl said.
Global Insight concluded that over the 1985-2004 period, Wal-Mart led to to 9.1 percent decline in food prices, a 4.2 percent decline in prices of other goods and a 3.1 percent decline in overall consumer prices.
The research firm found Wal-Mart led to a 0.75 percent improvement in the overall efficiency of the economy, based on capital intensity and lower import prices.
ROFL!!!!!!!!!!
I used to sell to Walmart in Bentonville and it was amazing to see how their corporate offices were like a small business' warehouse. Small rooms, drab and without hubris. Compare that to the Kmart offices which were like a palace.
The buyers were more interested in how our products were positioned and the quantity in certain areas where our product was in demand by customers. They did not take an advertising program on a national scale just because it added to their bottom line (unlike many other retailers who take the money and run, even if the product wouldn't work in a certain area).
Although as such a massive company they are bound to have problems, especially with the left who hate success, I am impressed by their business sense and dedication to grow by meeting the needs of their customers. I think criticism is good to keep them honest, but the extent of the hatred for Walmart can be as logical as blaming Bush for Paris burning.
LO:. Wait til Walmart starts selling made in China automobiles.
Read my previous post.
PULEEEEEEEEZE........WalMart doesn't sell anything different than any other retailer, thus the same can be said for any other retailer.
All of your points are excellent, but this did give me a chuckle...the left is blaming Bush for the hurricanes, so why not for Paris burning?
WALMART does sell stuff that everybody else sells. But there are two important things that you ignore:
1. WAL*MART SELLS MORE STUFF THAN OTHER RETAILERS!
2. WAL*MART SELLS FOR LESS.
PLEASE! WAL*MART is not just another company that sells stuff.
You are missing the point here..............it is the manufacturers that moved overseas - not WalMart or any other retailer.........and the manufacturers were doing so long before WM ever came on the scene.
My entire point on all of these WM bashing threads is not that WM is so great - but rather WHY have the US manufacturers moved their operations out of the US?
No one wishes to look at the real culprits, they just want to beat up on one guy.
These folks know exactly what you mean. Their intent is largely to obscure the clarity of argumentation and hide within the cloud of confusion they create. The root of their argumentation is the notion of "everyone does it" combined with the notion that "the only reason businesses exist is profit". Everything else to them is moot. Just as with businesses that hired child laborors or used slaves. Just as with trucking companies that ran their drivers without breaks till they were falling asleep at the wheel -endangering themselves and others, etc. Profiteers often forsake all but the money they seek and "we the people" end up having to reign them in and place restrictions upon them in order to uphold moral principles of right and justice. The fogging of the argument is their hope that "we the people" will not so constrain them this time as has been the case in the past. They don't want to be held to answer. In all likelyhood though, they will be.
...on the other hand, as I have seen on these threads, a lot of people really, really like Wal-Mart. If there was not support for the "big box" retailers, folks wouldn't let them build in their communities.
That's true; but, not entirely accurate. There are some communities wherein walmart is the only business functionally selling some things. There are others where walmart may be open 24 hours and is the only place to buy things after a certain time of night. There is also the condition now imposed as a result of walmart - that people make so little that walmart is the only thing they can afford.
Trying to put this into a simplistic one line rebuke is not so easy to do. I don't shop at Walmart. But I know many do. And I know they cannot afford to shop elsewhere because of wages. Amazingly, before Walmart came here, people could afford better and did. Now they do not. At the same time, since walmart has come in, a lot of high dollar jobs have left due to similar competition - offshored and outsourced, and now the majority of jobs around here are low paying. Ant it continues to get worse.
Here in NYC they've blocked Wal-Mart at every turn, though Home Depot, Target and K-Mart seem to flourish.
That a Wal-Mart in a small community essentialy kills off the downtown as well as shopping malls is beyond debate. I've seen vacant stopping mall stores with plywood over the windows with my own eyes.
On the other hand, Wal-Mart is what people seem to want. Some of the pro-Wal-Mart people on these threads are quite passionate about the store and are prepared to defend them with facts, figures and last ounce of strength.
My only response to that is: well, okay. you get what you want. this is America and people more or less can create the type of community they want. It wouldn't be my choice, but it's still a free country.
People want Candy; but, one cannot live off of candy. People want bread and circuses. Both are not normally feasable unless in moderation. Walmart is the antithesis of moderation as concerns the depressing of wages, price and profits. Companies may make a great deal of money because of Walmart, but they also lose over what they could make were it not for Walmart. Walmart is the compromise position of doing or doing without. Walmart has used its weight to so depress the market, that the competition it creates is both damaging and at once constructive to it's own end. When you run everyone else off, you are now the only thing anyone can afford. I have a cheap house in my hometown - cheaper than rent for an apartment would be. And I can barely afford to live in it. I don't know how renters afford anything - especially young kids just entering the market.
Anyway, off to work.
take care
That's exactly right. This means there are TWO variables: 1. Money supply 2. supply of goods
I'll agree as long as you agree that "supply of goods" is roughly equivalent "money demand".
While the Fed is in part responsible for the money supply in America, the supply of goods comes from China thru Wal*Mart. Therefore Wal*Mart does indeed have a huge influence on inflation in America.
The Fed is almost wholly responsible for money supply in America. It could devalue the dollar by a factor of 10 overnight if it wanted to. It could create a policy of deflation if it wanted to. Yes, banking theory suggests that banks can create money, but that is immaterial to the power of the Fed. Trade with China is irrelevant to US monetary policy.
Advocates of Classical economics (like me, see screenname) believe the role of the Fed is to keep the value of the dollar stable. That should be the sole goal of monetary policy. Keynesians (and their cousins, the Monetarists) believe that the Fed should have some sort of target inflation. They agree with the Classicists that monetary policy is the driving factor in the value of the dollar. They simply think they can trick market forces into believing something that is not true with their inflation. Classicists do not believe you can trick the market. Classicists believe all inflation is bad.
I feel I'm getting into a discussion of Keynesianism vs. Classicism. If that is your desire, I will continue.
The big difference that is ignored is that Wal-Mart resists labor unions. That makes Wal-Mart a political lightening rod.
ping
Amen.
Wal-Mart pays better than Mom & Pop, and Mom & Pop sell the exact same things at a higher price. So, what's the argument here?
It's also worth noting that a lot of the "junk" are -American- junk. Take their budget furniture for example. All particle board... most all American. The Chinese furniture I have is solid wood.
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