[lit-ideas] NYTimes.com Article: Wal-Mart, a Nation Unto Itself
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- Date: Sun, 18 Apr 2004 02:00:55 -0400 (EDT)
The article below from NYTimes.com
has been sent to you by cskir@xxxxxxxxxxxxxx
FYI-More than just a curiosity.
Carol
cskir@xxxxxxxxxxxxx
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Wal-Mart, a Nation Unto Itself
April 17, 2004
By STEVEN GREENHOUSE
SANTA BARBARA, Calif., April 13 - We already know that
Wal-Mart is the biggest retailer. (If it were an
independent nation, it would be China's eighth-largest
trading partner.) We also know that it is maniacal about
low prices. (Some economists say it has single-handedly cut
inflation by 1 percent in recent years, saving consumers
billions of dollars annually.) We know that its labor
practices have come under attack. (It charges its workers
so much for health insurance that about one-third of them
do not have it.)
But the more than 250 sociologists, anthropologists,
historians and other scholars who gathered at the
University of California here on Monday for a conference on
Wal-Mart came looking for more than the company's vital
statistics. Like archaeologists who pick over artifacts to
understand an ancient society, the scholars here were
examining Wal-Mart for insights into the very nature of
American capitalist culture. As Susan Strasser, a history
professor at the University of Delaware, said, "Wal-Mart
has come to represent something that's even bigger than it
is."
Indeed, with $256 billion in annual sales and 20 million
shoppers visiting its stores each day, Wal-Mart has greater
reach and influence than any retailer in history. "In each
historical epoch a prototypical enterprise seems to embody
a new and innovative set of economic structures and social
relationships," said Nelson Lichtenstein, a history
professor at the University of California here and the
organizer of the conference. "These template businesses are
emulated because they have put in place, indeed perfected
for their era, the most efficient and profitable
relationship between the technology of production, the
organization of work and the new shape of the market."
In the 19th century, he said, the standard-setting company
was the Pennsylvania Railroad; in the mid-20th century, it
was General Motors; and in the late 20th century, it was
Microsoft. Today's prototypical company, he declared in
opening the conference, is Wal-Mart, which, he said,
rezones American cities, sets wage standards and even
conducts diplomacy with other nations.
"In short, the company's management legislates for the rest
of us key components of American social and industrial
policy," Mr. Lichtenstein said.
Wal-Mart has created a very different model from General
Motors, he added, noting that G.M. helped build the world's
most affluent middle class by paying wages far above the
average and by providing generous health and pension plans.
Mr. Lichtenstein said G.M.'s wage pattern spurred other
companies to raise compensation levels, while Wal-Mart's
relatively low wages and benefits - its workers average
less than $18,000 a year - were doing just the opposite.
The company's pay scale and hard-nosed labor practices,
said Simon Head, a fellow at the Century Foundation and
author of "The New Ruthless Economy: Work and Power in the
Digital Age" (Oxford University Press, 2003) mean that
"Wal-Mart is certainly a template of 21st-century
capitalism, but a capitalism that increasingly resembles a
capitalism of 100 years ago." He added, "It combines the
extremely dynamic use of technology with a very
authoritarian and ruthless managerial culture."
Wal-Mart declined to send a representative to the
conference. "We were invited to attend, but we passed,"
said Sarah Clark, a company spokeswoman. "The agenda looked
pretty biased against Wal-Mart."
If Wal-Mart is helping revolutionize labor relations, it is
also revolutionizing consumer patterns. Ms. Strasser said
it was the leading exemplar of a shift toward mass
merchandising, which in her view has transformed customers
into consumers. Many Americans, she said plaintively, no
longer deal daily with craftsmen and neighborhood
shopkeepers who give them advice on goods. Advertising is
the source of shoppers' information.
Wal-Mart has made a traditional sales force obsolete for
another reason, said James Hoopes, a historian at Babson
College, in Wellesley, Mass. When retailing began centuries
ago, salesmen were needed to explain goods to customers.
But Wal-Mart follows a different model. Using technology,
the company collects detailed information on the billions
of purchases its customers make each year. Based on that
information, it orders products (at low prices), confident
that customers will like the merchandise and the prices,
thus eliminating some of the need for an informed sales
force.
Everyone at the conference seemed to marvel at Wal-Mart's
extraordinarily sophisticated use of technology. The
temperature of every one of its more than 3,500 American
stores is controlled from its headquarters in Bentonville,
Ark. Logistics gurus keep track of hundreds of thousands of
shipments at home and abroad. Computers also keep close
tabs on workers' hours and productivity.
"One store manager told me, `I could tell you last year,
July 12, how much in sales the store did and how much was
rung up by Sally Jo, the cashier, within a particular
hour,' " said Ellen Rosen, a professor of women's studies
at Brandeis University, in Waltham, Mass.
Wal-Mart's in-depth knowledge of what consumers want,
coupled with its immense size, has given the company huge
power over its suppliers, effectively changing the
traditional relationship between manufacturer and retailer.
It usually knows more than manufacturers do about what
shoppers want this week and will want next year. With some
suppliers complaining that the company has bullied them,
Wal-Mart has caused factories from South Texas to Shanghai
to increase efficiencies continually and to lower their
costs and prices.
"It's changed the balance of global manufacturing," said
Gary G. Hamilton, a China expert and sociology professor at
the University of Washington.
And not just manufacturing.
"What do low-cost goods mean
in light of the pressing issues of the global environment,
global human rights and the global labor force?" Ms.
Strasser asked. "And how do we move beyond the
single-minded self-interest of price?"
Low prices come at a cost, she and other speakers insisted,
arguing, for instance, that Wal-Mart encouraged
overconsumption and overdevelopment, which place strains on
natural resources and the environment.
"Everything is based on the consumer first," said Edna
Bonacich, a sociology professor at the University of
California, Riverside. "Is this the way we want to live?"
To Ms. Bonacich, a hopeful sign that at least some people
would answer no came just days before the conference. On
April 6 in Inglewood, Calif., a largely black and Hispanic
suburb of Los Angeles, voters rejected a ballot initiative
allowing Wal-Mart to build a store there, with many saying
they were unhappy with its wage levels, fierce
anti-unionism and efforts to circumvent land-use
regulations.
Other conference participants pointed to a four-month labor
dispute in which the grocery workers' union fought a push
by Southern California supermarket chains to cut wages and
benefits for many workers because they feared Wal-Mart's
expansion plans in the state.
"The fact that it is starting to produce a backlash in a
lot of different areas has heightened the interest," Ms.
Strasser said.
But Mr. Hoopes questioned whether price-minded American
shoppers would ever rush to the barricades to battle
Wal-Mart.
"Wal-Mart has been tremendously helpful to the American
consumer," he said. "It's lowered prices for lots and lots
of people. People are voting with their feet and with their
dollars by shopping at Wal-Mart."
He added, "If anybody is proposing that they're going to
solve what they see as the Wal-Mart problem by urging
people not to think of themselves as consumers, they're
barking up the wrong tree."
http://www.nytimes.com/2004/04/17/arts/17WALM.html?ex=1083268055&ei=1&en=b2e5d05e2846e8f6
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