DE TOCQUEVILLE GETS AN EARFUL ON
WAGES:
WHAT ABOUT CHINA, BANGLADESH?
None of the guests at de Tocqueville's Bed and
Breakfast are minimum wage workers from towns where
thousands of low end Wal-Mart nonunion jobs both depress
wage levels and provide income for those who would otherwise
be on welfare.
But opines one breakfaster:
It is a vicious cycle where low paid Americans are
increasingly dependent on Wal-Mart's low cost goods while
low Wal-Mart salaries press other wages down.
Not to mention the ruthless cost cutting which Wal-Mart
buying practices impose on "sweatshop" producers from
southern China to Honduras
The company's size and obsession with shaving costs have
made it a global
economic force. Its decisions affect wages,
working conditions and manufacturing practices - even the
price of a yard of denim around the world.
From its headquarters in Bentonville, Arkansas, the company
has established a network of 10,000 suppliers and constantly
pressures them to lower their prices. At the same time,
Wal-Mart buyers continually search the globe for
still-cheaper sources of supply. The competition pits vendor
against vendor, country against country. To stay competitive
American suppliers must sometimes cut costs by following
Walmart's suggestions to move their factories overseas.
How can overseas managers hope to sell to Wal-Mart unless
they bust unions, squeeze their workers and keep wages down?
Wal-Mart appears to force down wages all over the world,
wherever suppliers must compete to gain lucrative contracts
with America's largest business enterprise, with the world's
largest single employer.
From Honduras to China there has been Wal-Mart related labor
unrest. Twelve thousand workers of a Wal-Mart supplier, a
Chinese-Japanese joint venture walked out in 2004. Chinese
strikers used blogs and cell phones SMS text messaging to
organize their protests.
In southern China, Wal-Mart has found all the ingredients it
needs to keep its "every day low prices" among the lowest in
the world.
Although labor costs more in China than in places such as
Bangladesh, China offers other advantages: low-cost raw
materials; modern factories, highways and ports; and helpful
government officials.
Wal-Mart has been instrumental in making this corner of
China the world's fastest-growing manufacturing zone.
The phenomenon is rattling competitors worldwide and
worrying international labor activists. They cite the
Chinese government's hostility toward organized labor and
its lack of worker protections, according to a 2003 in-depth
report in The
Los Angeles Times.
Wal-Mart has more than 3,000 supplier factories in China,
and the number is expected to rise. But that doesn't mean
workers in China are secure. With Wal-Mart's aggressive
policies of seeking the cheapest suppliers, employers are
constantly under pressure to move jobs and factories to the
cheapest location.
DE TOCQUEVILLE BACK AT
BREAKFAST:
SORTING OUT "1000 SCHOOLS OF THOUGHT"
One thing Alexis will quickly learn is that at any Bed
and Breakfast 1,000 people can have 1,000 opinions when it
comes to Wal-Mart.
First he would need to sort out the guests.
He would be quick to note the many differing ways Americans
can view Wal-Mart based on experience, location, ideology,
and economic self interest.
But how would he tie it all together? What sense would he
make of it all?
Fundamental question: does a consumer earn enough to pass up
the large savings which come from buying at Wal-Mart in bulk
food, clothing, electronics. and other items. Not to mention
the vast savings available by buying at Wal-Mart owned
Sams
Clubs, where major discounts are available after
paying a membership fee of $35 to $100.
Upper class professionals, the liberal and the wealthy may
have an easier time passing up such bargains based on
principle than less privileged buyers on tight budgets and
limited income.
Just as important in shaping breakfasters views:
1) Are they from some city of varied
specialty shops where Wal-Mart undercuts with low prices,
to threaten existing shops and services either in
traditional downtown areas or even in malls? Where
Wal-Mart threatens to reduce choice? Where there is a
rich variety of professional and well paid employment,
where many can afford higher priced alternatives to
Wal-Mart?
2) Are they from a small town or city with a deep
shortage of stores, where without a Wal-Mart there would
be no choice and little access to low cost modern
consumer goods? Where access to the American dream of
mucho goods at bargain prices requires a costly gas
guzzling drive to a distant city say 70 miles away?
3) Are they from places where residents and consumers
earn so little in depressed areas of high unemployment
that sleek consumer goods seem beyond the pale? Where a
Wal-Mart wage seems a princely sum? Where Wal-Mart prices
seem equivalent to a wage increase?
4) Are they from a town where Wal-Mart has become so
entrenched that few new shops dare take the risk to open
their doors? Where Wal-Mart threatens future choice -
unless these new shops offer high cost specialties for
prosperous tourists in from wealthier areas where
prosperous economies and high incomes grant the luxury of
staying out of a Wal-Mart?
*****
ALEXIS MIGHT WISH TO
WRITE A WHOLE NEW BOOK
If Democracy
in America were written today, would Chapter One
concentrate on Wal-Mart? More likely he would have to write
a whole new book titled "Wal-Mart in America."
Only Alexis can say for sure. Given all that he would hear
about Wal-Mart he might choose to move on, to write a whole
fresh new classic, Walmart in America.
De Tocqueville could no doubt lift some lines from his 1835
classic, particularly from Volume
2, Chapter 7, But he'd need to do some heavy
rewriting.
His views on wages seem overly optimistic in view of
downsizing, decline of unions, outsourcing overseas and the
general dislocation which threatens the middle class and
condemns increasing number of minimal skills workers to low
wage, low benefit Wal-Mart style jobs.
De Tocqueville's words below were written at a time when the
dream of entering the "middle class" without belonging to
the upper class aristocracy seemed a growing American
dream.
Most of the remarks
that I have already made in speaking of masters and
servants may be applied to masters and workmen. As the
gradations of the social scale come to be less observed,
while the great sink and the humble rise and poverty as
well as opulence ceases to be hereditary, the distance,
both in reality and in opinion, which heretofore
separated the workman from the master is lessened every
day. The workman conceives a more lofty opinion of his
rights, of his future, of himself; he is filled with new
ambition and new desires, he is harassed by new wants.
Every instant he views with longing eyes the profits of
his employer; and in order to share them he strives to
dispose of his labor at a higher rate, and he generally
succeeds at length in the
attempt..........
Ah, but the 1830's were so long ago.
TOP
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MORITZ
September 1, 2005
