patrick.net

If you knew what Walmart does to their suppliers you might not be such a big fan of theirs.

The man who said no to walmart
http://www.fastcompany.com/magazine/102/open_snapper.html
He suggested that Snapper find a lower-cost contract manufacturer. He suggested producing a separate, lesser-quality line with the Snapper nameplate just for Wal-Mart. Just like Levi did.

http://walmartwatch.com/blog/archives/the_lies_wal_mart_tells_wal_marts_overseas_sourcing/

Just to set the record straight--Social Security is not in the red, Medicare/Medicaid is not in the red. The War on Poverty does not generate revenue so not sure how you can measure profitability.

ChrisW, thanks for the link. It brought back memories of the WalMart of my childhood..."Made in the USA". Now everything is cheap:O( I bought a shirt from there during my last shopping experience there in around 1996. The shirt fell apart after 3 washings. Maybe that's why it only cost me $3.99.

Honest Abe, why all of the promoting of Walmart? You work there or something?

And where's your buddy who says "buy American?" Just about everything Walmart sells is made in China. What a great, patriotic company Walmart is!

Walmart already does run the economy. You think our favored nation status with China is because of mom and pop stores?

Walmart, while not *the* reason for the trade imbalance, is highly symbolic over it. The persuit over cheap, disposable crap instead of quality products is what got us to where we are.

Sorry, just not a fan of Walmart. They have destroyed the businesses of several suppliers (remember Vlasic pickles?). They sell a lot of low-quality junk, and they don't adequately pay or insure their employees, instead leaving the local governments to pick up the tab for their employees' healthcare needs. And they strategically destroy downtown businesses in small towns. In my old college town, Walmart moved in, dropped their Rx prices until the local pharmacist could not possibly compete, and then raised prices significantly after his business closed. Just business, of course, unless you were one of the elderly townies who depended on the local downtown pharmacy to deliver your meds--which they did for free. Suddenly people who could not drive themselves around anymore needed to get to the Walmart in the next town to buy their meds, and pay more for the privilege. I refuse to believe that a business must be quite so predatory and opportunistic in order to succeed.

I have not been in a Walmart in years, so I may be missing out on some big improvements. But I just hated their business strategy. So much so that I would really and truly rather pay more to a business that I believe to be more ethical.

You aren't missing out on anything by avoiding wal mart. All they sell is cheap, disposable crap -- they just happen to sell it for less than other people.

If you want to buy something that is high (or even moderate...) quality, go elsewhere.

That's really the worst part about what walmart has done to the retail world. These days you pretty much have to choose between extremely expensive, high quality stuff, and cheap crap that will last about as long as it takes to pay for it.

You won't be buying anything from wal mart that you can hand down to your children. Hell, you can't even hand down their clothes from an older to a younger child because they fall apart after a few dozen washings.

tatupu70 says

Just to set the record straight–Social Security is not in the red, Medicare/Medicaid is not in the red. The War on Poverty does not generate revenue so not sure how you can measure profitability.

You forgot the post office is an independent agency and hasn't received tax dollars since 1980. Last time I checked fanny/freddie were taken over by the government last year because they went bankrupt as private corporations. I guess that leaves none of the above in the red whatever that in the red means. I wasn't aware that government programs were required to have a profit and loss statement.

I don't have a problem with WalMart. They provided what people wanted. Be careful what you ask for, you may get it.

chrisw says

The man who said no to walmart
http://www.fastcompany.com/magazine/102/open_snapper.html
He suggested that Snapper find a lower-cost contract manufacturer. He suggested producing a separate, lesser-quality line with the Snapper nameplate just for Wal-Mart. Just like Levi did.
http://walmartwatch.com/blog/archives/the_lies_wal_mart_tells_wal_marts_overseas_sourcing/

Wow - the story about Snapper is amazing. I was particularly impressed by the description of the waiting room & the office furniture. I don't believe that it would hurt for the people who run the company to have a comfortable place to meet - and a happy office environment makes it easier to do a good job. But Walmart is obviously more concerned about the cheap than the comfortable.

But that's not the point of the story - the guy at Snapper decided he'd rather not make his product cheaper to sell it at Wally World (walmart), and that he'd rather not put their distributors out of business. In other words, he has a conscience. Wow.

Are Target, Lowes, or Home Depot that much better? Or even Sears for that matter (aside from some of the wrenches and sockets still made in the US)?

Wal Mart is the poster child for why Congress needs to restore sensible tariffs. Companies moved their manufacturing offshore, and now re-import their cheaper products to compete with U.S. goods. As a net total, the U.S. economy traded blue collar manufacturing jobs for bottom-of-the-barrel minimum wage jobs plus slightly cheaper goods. We also need to break the artificial yuan valuation before China completely sucks our manufacturing base dry.

I'm a huge proponent of free trade, but not when it hollows out your economy.

And we're not even mentioning Wal Mart's despicable tactics towards employees, including union busting. The Walton family is a savvy Carnegie clan---putting up the facade of charity while mercilessly exploiting their own workers. If they didn't have so much influence on Capitol Hill, the Justice Department would already be down their throats with anti-trust investigations.

I'm not a "big fan" of Wal-Mart either...I'm just not so opposed to them. To my understanding they provide more JOBS than any other company in America. They pay TAXES. They are not breaking any laws. Americans have FREE CHOICE to shop there - or not.

Subsidies are, have been and always be a dumb-a$$ idea. (1) They "protect" non-competitive busniesses and (2) FORCE American consumers to PAY MORE for the same product. FORCING the American consumer / taxpayer to take it in the shorts always seems to be the "go to solution" for dim-witted politicians.

And yes, our country is being sucked dry by Social Security, Fannie, Freddie, Am-Trak, Medicaid, Medicare, Food Stamps, Rent subsidies...our safety net has become a hammock.

"The U.S. government reported a record monthly deficit for Feb 2010 of $220.9 billion. Total tax reciepts were less than half of that - $107.5 billion. WE ARE AT THE POINT WHERE IF THE GOVERNMENT TAXED AMERICANS AT 100% OF THEIR INCOME IT WOULD NOT BE ENOUGH TO BALANCE THE BUDGET. Likewise, if the government cut 100% of its spending including defense, BUT KEPT PAYING SOCIAL SECURITY, MEDICARE AND MEDICADE, WE WOULD STILL HAVE A BUDGET DEFICIT." http://inflation.us

All this means is that the idiots in charge of everything expect the Federal Reserve to leave intrest rates at artificially low rates almost indefinitely. We know, however, it is impossible to do so without an outbreak of massive inflation in the prices of clothing, energy, food and everything else Americans need to live and survive.

In order to prevent disaster, interest rates need to be higher than the rate of inflation - LOOK OUT CRISIS DEAD AHEAD - brought to you by our very own government. Darn, I hate when that happens.
And we pay these people ?????

Tatupu - Medicare is paying out more than what they collect in taxes. Sounds like broken to me. Are you aware the average Medicare recipient gets $11,000 annually from the gov't? A giant Ponzi scheme. Same for Social Security. They will be broken this year - more hand outs than SS taxes collected. The two 800 pound gorillas will bankrupt our economy. The gov't will default some day (sooner than later). The voters will not let Congress stop funding the two giant Ponzi schemes. What gives? For starters it will be a gigantic tax increase or series of significant tax increases. They can only tax so much. Congress will not be able to keep up with the spending, so it will borrow until interest rates hit the ceiling. It will not cut spending and it will be Enron on a giant scale. Then it will face bankruptcy. The default will likely come through by monetary inflation then price inflation. Then we will have rationing of health care. There has to be default at some point. If Congress then keep getting the money from the FEDS it would lead to hyperinflation. Hyperinflation would destroy everything. I think the FEDS will eventually stop buying Treasury debt in the midst of mass inflation (20+%) to save the dollar. It then would be across the board default taking down all gov't programs. YIPEE! It is going to be very painful.

SF ace says

Paralithodes says

Are Target, Lowes, or Home Depot that much better? Or even Sears for that matter (aside from some of the wrenches and sockets still made in the US)?

Is Amazon that much better? They sell the same thing as Walmart and destory small business’ just as much, notwithstanding they are not even paying sales and income tax in 40 states, including California, which represents 30% of US sales.

I don't care about "small business" -- I don't even care about who's doing the manufacturing. What I do care about is the destruction of quality and erosion of choice.

Amazon sells pretty much everything, from cheap crap to high end. Walmart only sells cheap crap.

The problem is that wal mart is trying to replace dozens of specialty shops with one big store that does everything. Just like any institution that tries to do too much (companies that don't focus, governments that try to handle everything), the result is a steaming pile of mediocrity.

WalMart pays little in taxes, they pay little in payroll. They encourage their workers to go on foodstamps and every other other "welfare" program in existence, so they can subsist on their minimum wage jobs. Yeah that's real "conservative" behaviour they depend on the existence of a welfare state!

Vicente says

WalMart pays little in taxes, they pay little in payroll. They encourage their workers to go on foodstamps and every other other “welfare” program in existence, so they can subsist on their minimum wage jobs. Yeah that’s real “conservative” behaviour they depend on the existence of a welfare state!

Look at here: http://quicktake.morningstar.com/StockNet/Income10.aspx?Symbol=wmt&Country=USA
Its tax rate is about 33%, not sure what you mean by little.

Besides, no one FORCES anyone to work at Wal-Mart, do they?

Seems like every other retailer I searched for on MorningStar pays more. I wonder why everyone else has to pay their share, but WalMart gets a discount?

Yes people are forced to work at WalMart, after you've driven out of business all the factories and small businesses they used to work in.

wcalleallegre says

Tatupu - Medicare is paying out more than what they collect in taxes. Sounds like broken to me. Are you aware the average Medicare recipient gets $11,000 annually from the gov’t? A giant Ponzi scheme. Same for Social Security. They will be broken this year - more hand outs than SS taxes collected. The two 800 pound gorillas will bankrupt our economy.

1 - Please show me where Medicare recipients receive $11,000 "handouts" from the govt. To my knowledge, Medicare is a health insurance that doesn't pay anything to its recipients.
2- The $ that Social Security recipeints receive are substantially less than the amount that they would have had they invested the monies. The monies were supposed to be invested, to be paid out later when the person retired. But the gov't used the money all this time. That's why Social Security is in dire circumstances.

Medicare & Social Security aren't 800 pound gorillas in the room. They're out in the open. But what does any of this have to do with Wallmart?

Vicente says

Seems like every other retailer I searched for on MorningStar pays more. I wonder why everyone else has to pay their share, but WalMart gets a discount?
Yes people are forced to work at WalMart, after you’ve driven out of business all the factories and small businesses they used to work in.

There can't be that big of a difference -- the top marginal rate is still 35%, and wal mart is paying close to that.

But that is NOT the true story of corporate taxes, and anyone who believes it is clueless about how corporate earnings reports work. The trick is to hide as much profit as possible (legally acceptable under GAAP, keeping income off shore, etc.), while still giving investors a hint of what you're actually making.

Of *course* they're going to pay 35% on whatever they claim as taxable income! If you look at that and say "see, they paid their fair share", you're either ignorant or dishonest.

If anyone believes wal mart is only making $20b income on $400b in revenue, I have some beach front property in Arizona to sell you.

The wide distribution of economic power among many independent proprietors is the foundation of our Nation's economy. Both Franklin and Jefferson feared that industrialization would lead to a labor proletariat without property or hope. Small-business enterprise is a symbol of a society where a hired man can become his own boss...History shows that the elimination of the independent businessman has been the first step in the development of totalitarianism.

Representative Wright Patman of TX ~1932

Among other evils, these operations are designed to funnel money away from local economies all the way up to Wall St. Unless you are a major shareholder, (die), there is really nothing to defend about WalMart, and anyone who champions it or goes out of their way to downplay the damage this company's business model has caused both to the American middle class and to people abroad really owes it to themselves to do a little more research. I won't even get into the craftsmanship/quality side of things, because if you don't give a shit anyway, nothing I come up with is going to sway you.

Target and Ikea are not any better, by the way -- they just have slightly fresher garbage.

Honest Abe says: I’m not a “big fan” of Wal-Mart either…I’m just not so opposed to them. To my understanding they provide more JOBS than any other company in America. They pay TAXES. They are not breaking any laws. Americans have FREE CHOICE to shop there - or not.

The concept is called "Tragedy of the Commons". While it's true that individually people have free choice to avoid Wal Mart, they are also making decisions optimal for individuals. It is entirely possible to cripple a shared resource like the economy via Tragedy of the Commons, which ultimately harms the individuals who enjoyed the original benefit. The harm comes in aggregate, while the benefit comes individually, so the individuals will not adjust their personal behavior, even though the damage that ultimately flows back to them far exceeds the benefit.

I'd also point out that China manipulates the yuan, which in effect produces a massive economic subsidy. So a tariff on our part would make sense, both from a pure financial and a societal point of view.

Brand, thank you for your explanation of the Tragedy of the Commons, I had never heard that before and it makes perfect sense. So what do we do with Wal-Mart, shut them down???

As I was reading it I thought the "real tragedy" of commons is GOVERNMENT..."which harms the individuals who enjoyed the original benefit". Yes, I know we all need roads, teachers, firepersons and policepeople. but the way government has mismanaged our fiscal and monetary policies for the last 4 or 5 decades - "the harm comes in aggregate" and "the damage the ultimately flows back to them far exceeds the benefit". BINGO - thats kind of a good description of big, massive, bloated, disfunctional government.

Correct me if I'm wrong, but isn't the yuan PEGGED TO THE DOLLAR????? I have read in numerous sources that the yuan is pegged to the dollar, and if thats so, where is the manipulation?

Subsidies and tariffs are "protectionism" and again all they do is screw both the consumer and taxpayer in order to protect the manufacturer...the many suffer for the few (kinda sounds like socialsim in a way). You won't ever convince me of the "benefit" of subsidies and tariffs, and I probably won't be able to convince you of the destructive traits of subsudies and tariffs. So there you have it and thanks for your post.

Honest Abe says

Besides, no one FORCES anyone to work at Wal-Mart, do they?

When it's the only employer in town since they squeezed out every one else what choice do you have? A long commute? Move?

Abe, the yuan peg is artificial. You're obviously quite clever, so I won't bother explaining what happens when one side of a trade relationship engages in manipulation, and the other side refuses to respond based on its naive ideological beliefs. I will mention, however, that I'm rather tired of free market pretenders making large donations of American property to corporations, banks and other nations.

I view tariffs as having both positive and negative traits. But I don't live in a black and white world, either.

US had tariffs and thus "protectionism" for most of it's history. How do you explain that we prospered despite it? People who claim tariffs are going to bring economic disaster, frankly have read and understood very little history. There are no shortage of our "global partners" now who have quite stiff tariffs precisely to prevent US from taking over their markets, and many of them are not 3rd-world hellholes with people eating dirt cakes. They're laughing AT you, not with you.

And tariffs on Chinese imports could bring a vast resource of tax revenue that might help balance the US Federal Budget.

It might also allow American manufacturers who pay American workers living wages and choose to set up shop in the USA a chance to compete with a country that has 1 billion slave wage laborers working in factories with terrible living conditions in order to sell cheap crap overseas.

We had our best economies under carefully constructed tariffs and some form of carefully constructed protectionism. The entire "Free Trade" movement has done nothing but destabilize the USA and other first world countries that participate while pouring major wealth into 2nd and 3rd World countries.

While I'm all for balance in trade and for the advancement of 2nd and 3rd world nations, I believe that trade should benefit ALL countries instead of allowing one country to leech off another.

Which is worse? Walmart or Walmart shoppers? The shoppers are almost willing to run over PEdestrians and wreck their cars to get a parking spot 3 spots closer to the store. Is walking 50 additional feet worth putting people's lives in danger? The lines are always way too long. They also don't carry a lot of quality products. The only time I go is to buy Charcoal. I can find other places that can sell the same goods I but at almost the same price.

There's at least one distinction: you can actually buy quality product at Amazon. It does not pander to the LCD.

newhomebuyer7 says

Which is worse? Walmart or Walmart shoppers? The shoppers are almost willing to run over PEdestrians and wreck their cars to get a parking spot 3 spots closer to the store. Is walking 50 additional feet worth putting people’s lives in danger? The lines are always way too long. They also don’t carry a lot of quality products. The only time I go is to buy Charcoal. I can find other places that can sell the same goods I but at almost the same price.

Amen brudda!

I haven't been in one in WallyWorld in 2 years.

My favorite reasons not to are here:

http://www.peopleofwalmart.com/

Walmart elects them, Moron

Wal-Mart and their capitalist/corporate comrades pay for the ads that gets the sheep to elect these morons. If you don't know that advertising money elects officials, you must of been born last night. Why isn't your admired corporate piranha contributing to good representatives? They want these guys in office! Wake up and smell the coffee.

However, in the former US perhaps, the people could actually go out and get involved in politics instead of just watching and believing what the corporations tell the media to say!!!

Moreover, what the praise of Wal-Mart fails to mention is that Wal-Mart manufactures in China, that Wal-Mart raised prices after it put all those competitors out of work - the low prices were only predatory pricing, temporary. Their idea of commercial competition is search, destroy, and pillage. What about all those middle class people, the owners, accountants, property owners, lawyers, consultants, and the many more people they employed, the service jobs and businesses that were lost because all those competitors that went bankrupt? The worker is the consumer, people out of work don't consume as much! Wal-Mart's lower prices hurt not only country, but also your community by putting your friends and neighbors out of work!!

If all you care about is low price today, if all you can see is the carrot in front of your nose, it is your fault, not theirs. The same applies to politics.

Everyone wants to blame the representatives. They are just mirrors of ourselves, bitching about others when it is our negligence that allows them to exist.

How many of you actually get involved in politics before the voting booth? When was the last time you read a book on economics? The Middle East? Prison reform? Repairing the legal system? From the other side of the thinking from you WITH AN OPEN MIND? Most people only listen to their propagandist.

The fanatics run politics. The non fanatics are distracted, would rather watch TV, holiday weekend, go to the mall, and then complain about politicians.

"You cannot cheat an honest man"

However, it may be too late. The corporate/capitalists and Israel control the US government. The people that Wal-Mart and friends elected are destroying our country.

"Yes, of course, the Nakba* happened! What do you think I am, some kind of evil Nakba-denier?" Kevin Barrett

*Palestinian Holocaust (May 15, 1948 till present.)

“You cannot cheat an honest man”

????

Like hell you can't.

Well, as "evil" as eveyone seems to make Wal-Mart...at least they know how to operate in the black. Something the people in D.C. (District of Corruption) still haven't learned how to do yet.

Honest Abe says

Well, as “evil” as eveyone seems to make Wal-Mart…at least they know how to operate in the black. Something the people in D.C. (District of Corruption) still haven’t learned how to do yet.

Er, they were operating in the black about 10 years ago. What happened?

The thing that allows Walmart to operate in the black is primarily their support for a communist regime. Are you suggesting that the US should become a communist regime to be more like wal mart?

LOL. Kevin, I think he means we should go commie only if it's profitable for the government.

In all seriousness, 10 years ago we were in the middle of the tech boom. It's fairly common for governments to show black ink for boom years. It's also not surprising to show copious red ink during a serious recession.

That was kind of my point. Governments tend to rack up debt during bad times and hopefully repay that debt during good times. Economically speaking, the 90s were good times. Despite the tech bubble popping, the first 5 or 6 years of the 00s were also pretty decent. I'd bet a paycheck that we'd still be in the black had we not gotten involved in two wars and kept tax rates where they were in 2000.

For sure. If we weren't at break-even, we'd at least be far closer. However, I'd point out that Congress also spent up to their level of income during the booms, including commitments and entitlements that last a lot longer than the bump in revenue.

Back to Walmart...

Will Walmart be the end of Whole Foods and Farmer's Markets while saving sustainable and local produce?