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Wal-Mart is Taking Over the World

How Wal-Mart is Remaking our World

Jim Hightower, Hightower Lowdown
April 26, 2002

Bullying people from your town to China
Corporations rule. No other institution comes close to matching the power
that the 500 biggest corporations have amassed over us. The clout of all 535
members of Congress is nothing compared to the individual and collective
power of these predatory behemoths that now roam the globe, working their
will over all competing interests.

The aloof and pampered executives who run today's autocratic and secretive
corporate states have effectively become our sovereigns. From who gets
health care to who pays taxes, from what's on the news to what's in our
food, they have usurped the people's democratic authority and now make these
broad social decisions in private, based solely on the interests of their
corporations. Their attitude was forged back in 1882, when the villainous
old robber baron William Henry Vanderbilt spat out: "The public be damned!
I'm working for my stockholders."

The media and politicians won't discuss this, for obvious reasons, but we
must if we're actually to be a self-governing people. That's why the Lowdown
is launching this occasional series of corporate profiles. And why not start
with the biggest and one of the worst actors?

The beast from Bentonville
Wal-Mart is now the world's biggest corporation, having passed ExxonMobil
for the top slot. It hauls off a stunning $220 billion a year from We the
People (more in revenues than the entire GDP of Israel and Ireland
combined).

Wal-Mart cultivates an aw-shucks, we're-just-folks-from-Arkansas image of
neighborly small-town shopkeepers trying to sell stuff cheaply to you and
yours. Behind its soft homespun ads, however, is what one union leader calls
"this devouring beast" of a corporation that ruthlessly stomps on workers,
neighborhoods, competitors, and suppliers.

Despite its claim that it slashes profits to the bone in order to deliver
"Always Low Prices," Wal-Mart banks about $7 billion a year in profits,
ranking it among the most profitable entities on the planet.

Of the 10 richest people in the world, five are Waltons, the ruling family
of the Wal-Mart empire. S. Robson Walton is ranked by London's "Rich List
2001" as the wealthiest human on the planet, having sacked up more than $65
billion (£45.3 billion) in personal wealth and topping Bill Gates as No. 1.
Wal-Mart and the Waltons got to the top the old-fashioned way, by roughing
people up. The corporate ethos emanating from the Bentonville headquarters
dictates two guiding principles for all managers: extract the very last
penny possible from human toil, and squeeze the last dime from every
supplier.

With more than one million employees (three times more than General Motors),
this far-flung retailer is the country's largest private employer, and it
intends to remake the image of the American workplace in its image, which is
not pretty.

Yes, there is the happy-faced "greeter" who welcomes shoppers into every
store, and employees (or "associates," as the company grandiosely calls
them) gather just before opening each morning for a pep rally, where they
are all required to join in the Wal-Mart cheer: "Gimme a 'W!'" shouts the
cheerleader; "W!" the dutiful employees respond. "Gimme an A!'" And so on.
Behind this manufactured cheerfulness, however, is the fact that the average
employee makes only $15,000 a year for full-time work. Most are denied even
this poverty income, for they're held to part-time work. While the company
brags that 70% of its workers are full-time, at Wal-Mart "full time" is 28
hours a week, meaning they gross less than $11,000 a year.

Health-care benefits? Only if you've been there two years; then the plan
hits you with such huge premiums that few can afford it, only 38% of
Wal-Marters are covered.

Thinking union? Get outta here! "Wal-Mart is opposed to unionization," reads
a company guidebook for supervisors. "You, as a manager, are expected to
support the company's position. . . . This may mean walking a tightrope
between legitimate campaigning and improper conduct."

Wal-Mart is in fact rabidly anti-union, deploying teams of union-busters
from Bentonville to any spot where there's a whisper of organizing activity.
"While unions might be appropriate for other companies, they have no place
at Wal-Mart," a spokeswoman told a Texas Observer reporter who was covering
an NLRB hearing on the company's manhandling of 11 meat-cutters who worked
at a Wal-Mart Supercenter in Jacksonville, Texas.

These derring-do employees were sick of working harder and longer for the
same low pay. "We signed [union] cards, and all hell broke loose," says
Sidney Smith, one of the Jacksonville meat-cutters who established the
first-ever Wal-Mart union in the U.S., voting in February 2000 to join the
United Food and Commercial Workers. Eleven days later, Wal-Mart announced
that it was closing the meat-cutting departments in all of its stores and
would henceforth buy prepackaged meat elsewhere.

But the repressive company didn't stop there. As the Observer reports:
"Smith was fired for theft, after a manager agreed to let him buy a box of
overripe bananas for 50 cents, Smith ate one banana before paying for the
box, and was judged to have stolen that banana."

Wal-Mart is an unrepentant and recidivist violator of employee rights,
drawing repeated convictions, fines, and the ire of judges from coast to
coast. For example, the Equal Employment Opportunity Commission has had to
file more suits against the Bentonville billionaires club for cases of
disability discrimination than any other corporation. A top EEOC lawyer told
Business Week, "I have never seen this kind of blatant disregard for the
law."

Likewise, a national class-action suit reveals an astonishing pattern of
sexual discrimination at Wal-Mart (where 72% of the salespeople are women),
charging that there is "a harsh, anti-woman culture in which complaints go
unanswered and the women who make them are targeted for retaliation."
Workers' compensation laws, child-labor laws (1,400 violations in Maine
alone), surveillance of employees, you name it, this corporation is a repeat
offender. No wonder, then, that turnover in the stores is above 50% a year,
with many stores having to replace 100% of their employees each year, and
some reaching as high as a 300% turnover!

Worldwide wage-depressor
Then there's China. For years, Wal-Mart saturated the airwaves with a "We
Buy American" advertising campaign, but it was nothing more than a
red-white-and-blue sham. All along, the vast majority of the products it
sold were from cheap-labor hell-holes, especially China. In 1998, after
several exposes of this sham, the company finally dropped its "patriotism"
posture and by 2001 had even moved its worldwide purchasing headquarters to
China. Today, it is the largest importer of Chinese-made products in the
world, buying $10 billion worth of merchandise from several thousand Chinese
factories.

As Charlie Kernaghan of the National Labor Committee reports, "In country
after country, factories that produce for Wal-Mart are the worst," adding
that the bottom-feeding labor policy of this one corporation "is actually
lowering standards in China, slashing wages and benefits, imposing long
mandatory-overtime shifts, while tolerating the arbitrary firing of workers
who even dare to discuss factory conditions."

Wal-Mart does not want the U.S. buying public to know that its famous low
prices are the product of human misery, so while it loudly proclaims that
its global suppliers must comply with a corporate "code of conduct" to treat
workers decently, it strictly prohibits the disclosure of any factory names
and addresses, hoping to keep independent sources from witnessing the "code"
in operation.

Kernaghan's NLC, acclaimed for its fact-packed reports on global working
conditions, found several Chinese factories that make the toys Americans buy
for their children at Wal-Mart. Seventy-one percent of the toys sold in the
U.S. come from China, and Wal-Mart now sells one out of five of the toys we
buy.

NLC interviewed workers in China's Guangdong Province who toil in factories
making popular action figures, dolls, and other toys sold at Wal-Mart. In
"Toys of Misery," a shocking 58-page report that the establishment media
ignored, NLC describes:

--13- to 16-hour days molding, assembling, and spray-painting toys8 a.m. to
9 p.m. or even midnight, seven days a week, with 20-hour shifts in peak
season.

--Even though China's minimum wage is 31 cents an hour, which doesn't begin
to cover a person's basic subsistence-level needs, these production workers
are paid 13 cents an hour.

--Workers typically live in squatter shacks, seven feet by seven feet, or
jammed in company dorms, with more than a dozen sharing a cubicle costing
$1.95 a week for rent. They pay about $5.50 a week for lousy food. They also
must pay for their own medical treatment and are fired if they are too ill
to work.

--The work is literally sickening, since there's no health and safety
enforcement. Workers have constant headaches and nausea from paint-dust
hanging in the air; the indoor temperature tops 100 degrees; protective
clothing is a joke; repetitive stress disorders are rampant; and there's no
training on the health hazards of handling the plastics, glue, paint
thinners, and other solvents in which these workers are immersed every day.

As for Wal-Mart's highly vaunted "code of conduct," NLC could not find a
single worker who had ever seen or heard of it.

These factories employ mostly young women and teenage girls. Wal-Mart,
renowned for knowing every detail of its global business operations and for
calculating every penny of a product's cost, knows what goes on inside these
places. Yet, when confronted with these facts, corporate honchos claim
ignorance and wash their hands of the exploitation: "There will always be
people who break the law," says CEO Lee Scott. "It is an issue of human
greed among a few people."

Those "few people" include him, other top managers, and the Walton
billionaires. Each of them not only knows about their company's
exploitation, but willingly prospers from a corporate culture that demands
it. "Get costs down" is Wal-Mart's mantra and modus operandi, and that
translates into a crusade to stamp down the folks who produce its goods and
services, shamelessly building its low-price strategy and profits on their
backs.

The Wal-Mart gospel
Worse, Wal-Mart is on a messianic mission to extend its exploitative ethos
to the entire business world. More than 65,000 companies supply the retailer
with the stuff on its shelves, and it constantly hammers each supplier about
cutting their production costs deeper and deeper in order to get cheaper
wholesale prices. Some companies have to open their books so Bentonville
executives can red-pencil what CEO Scott terms "unnecessary costs."
Of course, among the unnecessaries to him are the use of union labor and
producing goods in America, and Scott is unabashed about pointing in the
direction of China or other places for abysmally low production costs. He
doesn't even have to say "Move to China"his purchasing executives demand
such an impossible lowball price from suppliers that they can only meet it
if they follow Wal-Mart's labor example. With its dominance over its own 1.2
million workers and 65,000 suppliers, plus its alliances with ruthless labor
abusers abroad, this one company is the world's most powerful private force
for lowering labor standards and stifling the middle-class aspirations of
workers everywhere.

Using its sheer size, market clout, access to capital, and massive
advertising budget, the company also is squeezing out competitors and
forcing its remaining rivals to adopt its price-is-everything approach.
Even the big boys like Toys R Us and Kroger are daunted by the company's
brutish power, saying they're compelled to slash wages and search the globe
for sweatshop suppliers in order to compete in the downward race to match
Wal-Mart's prices.

How high a price are we willing to pay for Wal-Mart's "low-price" model?
This outfit operates with an avarice, arrogance, and ambition that would
make Enron blush. It hits a town or city neighborhood like a retailing
neutron bomb, sucking out the economic vitality and all of the local
character. And Wal-Mart's stores now have more kill-power than ever, with
its Supercenters averaging 200,000 square feet, the size of more than four
football fields under one roof! These things land splat on top of any
community's sense of itself and devour local business.

By slashing its retail prices way below cost when it enters a community,
Wal-Mart can crush our groceries, pharmacies, hardware stores, and other
retailers, then raise its prices once it has monopoly control over the
market.

But, say apologists for these Big-Box megastores, at least they're creating
jobs. Wrong. By crushing local businesses, this giant eliminates three
decent jobs for every two Wal-Mart jobs that it creates, and a store full of
part-time, poorly paid employees hardly builds the family wealth necessary
to sustain a community's middle-class living standard.

Indeed, Wal-Mart operates as a massive wealth extractor. Instead of profits
staying in town to be reinvested locally, the money is hauled off to
Bentonville, either to be used as capital for conquering yet another town or
simply to be stashed in the family vaults (the Waltons, by the way, just
bought the biggest bank in Arkansas).
It's our world

Why should we accept this? Is it our country, our communities, our economic
destinies, or theirs? Wal-Mart's radical remaking of our labor standards and
our local economies is occurring mostly without our knowledge or consent.
Poof, there goes another local business. Poof, there goes our middle-class
wages. Poof, there goes another factory to China. No one voted for this . .
. but there it is. While corporate ideologues might huffily assert that
customers vote with their dollars, it's an election without a campaign,
conveniently ignoring that the public's "vote" might change if we knew the
real cost of Wal-Mart's "cheap" goods, and if we actually had a chance to
vote.

Much to the corporation's consternation, more and more communities are
learning about this voracious powerhouse, and there's a rising civic
rebellion against it. Tremendous victories have already been won as citizens
from Maine to Arizona, from the Puget Sound to the Gulf of Mexico, have
organized locally and even statewide to thwart the expansionist march of the
Wal-Mart juggernaut.

Wal-Mart is huge, but it can be brought to heel by an aroused and organized
citizenry willing to confront it in their communities, the workplace, the
marketplace, the classrooms, the pulpits, the legislatures, and the voting
booths. Just as the Founders rose up against the mighty British trading
companies, so we can reassert our people's sovereignty and our democratic
principles over the autocratic ambitions of mighty Wal-Mart.
-------------------------------
More of Jim Hightower's writing can be found in his monthly newsletter, The
Hightower Lowdown. For more information, see www.jimhightower.
<http://www.jimhightower.com/> com <http://www.jimhightower.com/> .

<http://www.alternet.org/story.html?StoryID=12962>

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