Within two years, Wal-Mart will likely be the biggest private employer in the area, Brian McNeill writes in today’s Daily Progress. Between the location on 29N, the growing distribution center in Zion Crossroads, the planned location in Louisa and the newly-announced location in Greene, they’ll have 1,970 people working for them. The company’s low wages, poor benefits and discriminatory hiring practices make it less than clear that there’s anything particularly good about this news. McNeill’s article ends with a mysterious quote from Darden professor Paul Farris claiming that Wal-Mart’s presence may well be good for local retailers which, as The Hook‘s Hawes Spencer points out, would seem to challenge traditional logic.
News and meta-news about Charlottesville, VA, since 2001.
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Police announced this afternoon that their investigation into what was initially believed to be a fatal fire on Rugby Avenue is now a homicide investigation. #
The Virginia Supreme Court has denied George Huguely’s appeal. His second-degree murder conviction will stand, WRIC reports. #
In a carefully worded story, and not citing specific sources, WTVR reports that forensic evidence belonging to Jesse Matthew Jr., the main suspect in the disappearance of Hannah Graham, matches forensic evidence collected during the investigation of Morgan Harrington’s 2009 murder. #
In the wake of Hannah Graham’s disappearance, and the evidence that came from private security footage, city officials are revisiting the question of installing security cameras on the downtown mall. #
Both Charlottesville Registrar Sheri Iachetta and former Electoral Board member Stephanie Commander have turned themselves in to the police on
foursix and four felony counts of embezzlement, respectively. #Ten years ago, the National Institutes of Health budget doubled and schools like the University of Virginia built massive new research facilities. A decade later, those buildings remain largely underutilized. NPR visits UVA in this story on the effect of federal binge and spurge spending in the sciences. #
In 2012, Council approved a new student housing complex on West Main—now some council members are questioning whether what they were shown matches what was built. #
The Architectural Review Board has approved a bike-themed mural on West Market, below the McGuffey Art Center, although at least one member expressed concerns that it might look like the bicyclists were riding away from Charlottesville’s downtown. #
City Police Chief Tim Longo is meeting with city leaders to work on protocols regarding the use of military surplus police weapons in Charlottesville. #
A 100-year-old Colonnades resident received military honors for her service in the WWII Women’s Army Corps #
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well they do have great prices!
we all win!
Well, China wins. :)
China wins, unions lose, racism and discrimination wins, local busineses lose.
Yeh, huge win. Huge.
That’s been taken a bit out of context, no? Farris actually said, “Inevitably, some retailers are going to feel it, but the ones who survive in Wal-Mart’s shadow will find a way to prosper despite – and in some cases, because of – their proximity to Wal-Mart.”
So, he’s not saying Wal-Mart will be good for local retailers, he’s just saying that not every business in Charlottesville will be crushed by Wal-Mart and some could actually do better by being close to Wal-Mart.
Over in Waynesboro, I’d be willing to bet all the small shops that surround the Wal-Mart (Quizno’s, GameStop, etc.) do much better with Wal-Mart being close than they do if Wal-Mart wasn’t there. Wal-Mart doesn’t sell hot (and tasty) subs, but Quizno’s does. Wal-Mart doesn’t have all the game stuff that GameStop does. Those are two businesses where visitors to Wal-Mart would seem to have a greater likelihood of visiting than if they were standing on their own.
yea but saving hundreds on that plasma TV, I win!
ps i actually don’t like consumerism, but if people were to stop shopping there, then the beast will stop growing.
I had my first Wal-Mart experience in Richmond, back in 2001. I was down here on a business trip and was curious about what they actually looked like because they were somehow blocked from northern NJ were I grew up and weren’t near Boston yet (two or three have since opened in the greater Boston area). After about ten minutes, I had to leave. I don’t think I need to list out what I found so objectionable. Reading about their business practices doesn’t surprise me.
Regarding their prices, Wal-Mart isn’t all that great. The pennies “saved” are probably spent at the gas pump, since you inevitably have to drive out of the way to get to one. Google “Wal-Mart price comparison” and you’ll find plenty of information that suggests you aren’t saving all that much money by shopping there.
I find the elitist snobbery to Wal-Mart far more objectionable than Wal-Mart itself. If you don’t like it, don’t shop there. But I can do without the unrelenting hostility from on high that seems to compel people to ram their own views of Wal-Mart down the throats of the rest of us great unwashed masses.
The pennies saved are on the backs of WalMart employees. And I don’t shop there. K-Mart or Target suit me just fine.
Hostility’s a bit too strong a word, isn’t it? What’s more, no one is ramming their views down your throat by posting them on the internet.
It’s just a successful store that Americans like to go to purchase stuff. I honestly don’t get where thoughts like this come from: “After about ten minutes, I had to leave. I don’t think I need to list out what I found so objectionable.” What is up with that? It’s not a conspiracy between the Walton family, Chinese manufacturers, Halliburton, the Carlyle Group, and the John Birch Society – it’s just a store.
That quote from the Darden prof, however dubious, seems adequately introduced and couched.
Those Hook’ers can be jerks.
Several years ago, Wal-Mart wanted to come to Clemson. I can still hear the howls about how Wal-Mart was going to destroy downtown. Downtown Clemson.
If, as I suspect, you’ve never been to downtown Clemson, let me tell you that it is mostly a collection of bars. Along the entire strip, the only place that could have been legitimately threatened by Wal-Mart was a local pharmacy.
That’s just a humorous anecdote. In the end, Clemson didn’t get their Wal-Mart. The next town over did.
What is a more important point, is not that Wal-Mart is so much a problem. I think a huge problem is that a whole lot of people think that downtowns — and local, non-specialty shops — simply suck. I’ve spent my entire life living in towns where there was nothing of particular use downtown. So maybe that’s why I cannot romanticize about old stores with limited selection and high prices (some may call that “gouging”).
As for how Wal-Mart can help local businesses, I think Fred T. is correct.
Let me use an analogy.
Let’s say there was a town that survived on the labor of 3 farmers. All their farms are the same size, each produces say 10,000 bushels a year, and they mostly grew a few crops, say corn, wheat, and soybeans. Let’s say that one farmer has a brainstorm one year and figures out how to more-than-double his yields per acre. He is now the efficient farmer of corn, wheat, and soybeans and one of the other 2 farmers is now completely unnecessary. Let’s call the displaced farmer Ted. Ted has basically lost his job growing those 3 staple crops. If he’s a complete doofus, he’ll sit around crying all day every day. And he will be worse off. But if he has a grain of intelligence (pun intended), he’ll start growing carrots, broccoli, tomatoes, and peppers. Or maybe he’ll keep growing grain, but not as much as before, and feed that to some new cows and chickens. Whatever exactly he grows is to be determined by him. But he is free to pursue a new avenue to deliver new goods to the townspeople.
Ted was basically put out of business by the new Mega-Farm. But that left him able to pursue new business ventures and to possibly thrive in a new market segment.
“Ah,” you say, “everything is grown locally, and nothing is imported, unlike Wal-Mart.” Well let’s say that the owner of the other, non-efficient farm has a trick up his sleeve. We’ll call this farmer Alex. Alex has a brother, who is also a farmer. But Alex’s brother farms in another country and can grow much more grain at much lower cost because the weather and soil are more favorable. Alex realizes that for the same price as growing his annual 10,000 bushels of grain, he can buy the grain from his brother instead. This frees up all of Alex’s land for something else. And it frees up much of Alex’s time so that he can have more leisure, or create another new business.
So what all has happened as a result of these two scenarios combined? There are now fewer farmers. One of them was forced to completely re-invent his business. More money is “leaving the community,” and not just leaving the community, leaving the country! And the townspeople end up with greater selection and maybe even lower prices. So who loses?
This is a simplistic scenario. But it is also very telling.
I was trying to keep it short, but I guess I’ll add to what I wrote before.
Having never been in a Wal-Mart before, I found the Richmond store to be an incredibly uncomfortable and annoying place to shop. It was huge (no such thing as a “quick trip” to Wal-Mart, I imagine) and it was loud, with TVs everywhere showing commercials. There was a greeter at the door, but once I was in the aisles, there was no one to help me find anything. I wandered around for ten minutes, trying to find a charger for my cell phone. I finally found one that I thought to be compatible and bought it. By the end of the trip, it was broken.
When I first moved Charlottesville, I went to the Wal-Mart on 29 to get cleaning supplies and it was even worse than that Richmond store. It was dark, dirty, and hard to navigate. The time spent finding what I wanted and standing in line negated the ten cents I probably saved.
Add the information about their labor practices to those experiences and it’s very easy for me to shop elsewhere.
It was huge (no such thing as a “quick trip” to Wal-Mart, I imagine) and it was loud, with TVs everywhere showing commercials. There was a greeter at the door, but once I was in the aisles, there was no one to help me find anything. I wandered around for ten minutes, trying to find a charger for my cell phone. I finally found one that I thought to be compatible and bought it. By the end of the trip, it was broken.
This could easily be Circuit City, Best Buy, etc etc .. quite a few things in common there.
I generally try to avoid Wal-Mart because I simply hate crowds, but when a local pet shop is selling a bag of rawhides for $10, Giant has them for $7 and Walmart has them for $3, Walmart is going to get my money.
Multiply “not that much” by several items per trip times many trips per year and that can be quite a bit for a family. Although this benefit, however small is seen. What is unseen is how much the prices would be without Wal-Mart. Wal-Mart has been a major driver of efficiency gains in all aspects of retail sales. Those lessons have been learned and applied throughout the retail industry. Whether you have shopped at Wal-Mart or not, you have benefited from them.
I can also agree with Jeannine. The atmosphere in some stores is not great and some stuff they sell is total crap. Those are great reasons to not shop somewhere. They are much better reasons than those built on total fallacies.
Falstaff wrote:
It’s just a successful store that Americans like to go to purchase stuff. I honestly don’t get where thoughts like this come from: “After about ten minutes, I had to leave. I don’t think I need to list out what I found so objectionable.” What is up with that? It’s not a conspiracy between the Walton family, Chinese manufacturers, Halliburton, the Carlyle Group, and the John Birch Society – it’s just a store.
OK you huddled masses and unwashed peasants down there in the, well, it the places where you all huddle. Where is that anyway? Oh sorry, off the point. OK, well, don’t shop at walmart. It’s evil. And I know best. Because I’m not huddled, and I bath. And mostly because I have a cool hat. My wife says let them eat cake then if they don’t have bread. I think I’ll chop her head off.
OK, enough of that….
Good point Falstaff. Walmart sucks. It’s not fun to shop in. Especially the one on 29N. Jeeez that place really sucks. But the prices can be low, and if you don’t have much it’s hard to argue with that.
The main objects are usually the same objections with any company with horrible labor and trade practices. And as companies with horrible practices succeed, some folks get a bit upset. And it’s especially disheartening when such companies crush companies with much better practices. We want to make noise about it. We want to raise the alarm about such practices. But yes, sometimes this can sound like snobs not liking the store because, well, there are unwashed masses shopping there. Ewwwww.
I’m not a regular Wal-mart shopper, if I can get it somewhere else then I will. Part of that is because of all the negatives I’ve read about how they treat employees. However Jeannine’s experience is primarily why. If you’re not a regular then things are hard to find, staff are hard to locate for information and when you do find them they generally look worn out and or irritated and 50 percent of the time give you wrong information. And like Chad I don’t like crowds either. When I’m getting something I know what it is I’m getting and I want to be in and out with a minimum of hassle. You can’t get that from Wal-Mart.
Chad wrote: “This could easily be Circuit City, Best Buy, etc etc… “
True enough. Although I’ve had better experiences at Best Buy than Circuit City (the sole exception being the Best Buy Computer department- you have to stalk the one guy in the department waiting for him to finish flirting with the female customer that may or may not actually be purchasing something- before you can get a product question answered. That or drag someone over from a nearby department.) That and Best Buy is brighter and cleaner looking than either Circuit City or Wal-mart, and Best Buy employees don’t look near as pissed off as either of the other two companies.
There’s a very funny and dead-on parody video about big-box stores called “Big Box Mart” done by the guys at JibJab. It’s quick and worth looking at: http://www.jibjab.com/originals/big_box_mart
The parody is great. Thank you.
Fantastic find ChrEliz. And nice lesson: there’s a high cost for everyday low prices. Sarcasm is like cool or something.
look on the bright side, the dollar in the those sweatshop countries goes a long way for that 11 year old.
i work at the walmart distribution center… i get paid $18 an hour and get a $350 incentive check every three months…
i’m sorry, but i honestly don’t think that i make ‘low wages’. i also think that the childrens miracle network appreciated the $11 million that wal-mart donated to them in may.
Nobody’s claimed that every single employee of Wal-Mart is badly paid, merely that the business, on the average, pays worse than the jobs that they’re replacing, so badly that the state ends up subsidizing employees’ healthcare at a rate far, far greater than any other business.
The prices are low because they’re coming out of our taxes.
Take a look at the story…the average Wal-Mart employee makes $10.28 an hour. It’s pretty damn tough to live in Charlottesville or Albemarle on that.
That said, though, the people who will be employed in Wal-Mart’s lower-wage jobs are generally going to be folks who don’t have a lot of skills, and it’s hard to argue that Wal-Mart’s presence will eliminate some fabulous job that they have now. A Wal-Mart in Louisa may be great for the county; Louisa has very few non-chain places to shop now, and I’m quite sure there are folks who live there who drive to Charlottesville or Short Pump to work (or shop) in those Wal-Marts or chain grocery stores or some other low-wage kind of job. If they can go to the same job in 10 minutes, that’s a plus for them.
I don’t shop at Wal-Mart. The price difference just doesn’t justify the crappy customer service for me. But I do know a mother of six who saves literally thousands a year by buying groceries and other necessities there instead of other stores, and the money she saves helps her send her kids to camp, play in soccer leagues, etc. I don’t have a solution to the Wal-Mart versus local business problem, but I suspect that it won’t be a huge issue here. The folks that will begin shopping at the new Wal-Marts are probably already doing their shopping at chain grocery stores anyway, not local businesses. And the people who were loyal to local businesses will continue to be so. I highly doubt anyone who was buying produce at the C-ville market is instead going to start driving up to Greene to buy produce at Wal-Mart.
It is pretty much impossible to get something from nothing, so I’d argue that every dollar “saved” at Wal-Mart has to come from somewhere else. Like others, I think when you closely examine where those dollars are saved from, you realize that money is being bled out of communities.
You see, when you shop at a Wal-mart instead of say, a local pharmacy or hardware store, then a large amount of the money made is sent out of the county. If this weren’t true then there’d be no stockholders and no Walmart. Whats wrong with this? Local business managers and owners are more likely to spend their money locally. That means that even businesses that carry products not at Wal-mart suffer too, because they lose the income from the other small business owners that shopped at their store. In other words, the Wal-Mart Execs, are rather unlikely to buy a beer at Starr Hill, or Ice Cream at Chaps with the money we gave them.
Also, we’ve been sold on the idea that it’s better to have low prices than higher wages (including benefits). The end result of that is that we all make less, and have less to spend on the cheap goods. While this model equates to quick profits for Wal-Mart, I’d think its overall effect on the economy and standard of living for Americans isn’t good. Even if that money is made my using cheap foreign labor, that’s once again money NOT spent in the U.S. Workers in the U.S. are more likely to buy products and services from here. Workers in China… well… not so much.
Lonnie,
Pick up on Econ 101 textbook.
Kerry, thanks for that insightful and courteous comment.
Why is it that everyone who wants to support things like Walmart tries to use economics as a crutch? My experience is that almost any field of science can be explained in a way that makes it consistent with ones personal experience. That is, unless its just bunk.
The fact remains that there are really good case studies there about how WalMart has devestated local economies – especially small towns. If an economist tells me that’s not true becuase it isn’t consistent with their text book then the book needs to be rewritten. Likewise, can you disprove anything I’ve said? How is that even inconsistent with existing economic theory?
Yes, I am challenging the Golden Goose that cheaper products are optimal; however look at the Nations economy. The rich are getting richer and the poor poorer. This isn’t opinion but known fact. You explain it! Lowering prices doesn’t help the economy if you are also lowering wages along with it. If Walmart becomes a #1 employer, and has an average salary of $10.28 and hour, then that’s less money local citizens have to buy other goods and services; especially if the previous average wage was much higher. Explain to me how that benefits the economy?
This concept I’m using isn’t new. Henry Ford believed in it too, that by paying your workers more that you ultimately had more people that could afford to buy your product. Locally I think Bodos is another great example of a company that pays its workers higher wages and has succeeded because of it. After all, a worker paid a fair wage cares about their job. When the line is all the way out the door at Bodos, I still get my food quicker than in McDonalds and it’s better quality.
Lonnie,
Wow.
Let’s start simple. The idea that buying local is better for the economy is a complete and total fallacy. It is better for the locals who wish to foist upon you lesser goods or higher prices. But that’s about it.
Consider that when nations misbehave, (before the bombings start) there are almost always trade sanctions. Why? Because limiting their ability to trade with the rest of world will make them poorer. If increased trade with the rest of the world made them worse off, as you purport, then the proper mode of action for the United Nations or NATO would be to give them as many free goods as possible.
Consider nations that are heavily isolated, such as, Cuba, or North Korea. North Korea does a very good job of keeping their money local. And boy has it really paid off for them! They do much better than their peers to the South.
Now, seriously consider if all the money in the county stayed in the county. Good luck buying a car. Or a computer. Or salmon. Or gasoline. Or just about anything valuable. If you want to get anything, you have to send your money to someone somewhere else. To do otherwise is the road to poverty.
[Click here for more on the subject from UVA law grad and Chairman of the Department of Economics at George Mason University]
Now, seriously consider if all of the money in the county left the county. Good luck getting a job. Or buying anything. Like salmon. Or gasoline. Or just about anything valuable. If you want to get any money, you have to travel somewhere else. To do otherwise is the road to poverty.
That’s a fun game!
Kerry, I’m not saying that increase trade creates poverty. On the contrary, it is trade deficits that do. The issue with outsourcing so much of our labor buying so many goods from China is that it is a one way flow of traffic. The trade deficit with China for 2007 is already 76,324,300,000 (and that’s just four months).
The same is true locally. Yes, to the degree that Charlottesville businesses trade goods outside of Charlottesville (like Crutchfield) then buying goods from elsewhere doesn’t hurt us; however, if we buy EVERYTHING from outside our borders then we’ll just hemorrhage capital. This is why Wal-Mart is ultimately creating poverty, because the flow only goes one way. How many locally made products do they carry that they sell to the rest of the world? That’s the definition of trade, and if you don’t understand that then perhaps you are the one who needs to go back and reread your economics textbooks.
I’m guessing that in your example, some mean people come build a wall around Albemarle county. Then they come and steal all our money and prevent any more money from coming in. That would indeed be horrible. But no one is advocating that.
Other than theft or extremely bad investment, the only way for the money to leave the county is for us to buy stuff. If our incomes go to zero, but we have just about everything we need, I don’t see how that makes us poor. If, however, poverty is defined simply as a level of income, then the only real problem here is that poverty is an badly defined statistic.
Kerry, my example is as far-fetched as yours. Nobody is proposing that Albemarle wall itself off from the import of goods any more than anybody else is proposing that people steal all of our money. Everybody agrees that extremes are bad. But our current reliance on goods of terrible, even dangerous quality, all imported (much from a communist country) using enormous amounts of petroleum that we subsidize through wars…I think we can agree that it’s not really working out.
Self reliance is good for the individual and for the family. The family is the basis of our societal structure and, as such, it follows that self reliance is also good for a nation, a state, and a city.
Waldo,
We have greatly different definitions of self reliance.
I also have little use for refusing to trade with people I disagree with. In fact, I consider international trade for useful goods the highest form of international aid.
Lonny,
No. No that is not the definition of trade.
Trade absolutely does not have to be balanced bilaterally.
Actually, trade doesn’t even have to be balanced in sum.
If a country like China, or any foreign nation, is refusing to spend their dollars, they are either saving, investing, or burning.
If they save, they’re just waiting to buy things later. Countries do this. People do this. Many Americans as individuals run surpluses for decades (saving) before they retire and run deficits until they die.
If they invest, then the money is coming back and we are not hemorrhaging capital.
Or, if they burn it, they are basically sending us billions of dollars of goods in exchange for ash, worthless ash. Thus the goods we get are a gift. This is very much like a gift card from a restaurant that goes unused.
Beyond all that, measurements of trade surpluses or deficits are woefully inadequate for measuring economic health. An extremely poor person can run small but consistent surplus year-after-year and still be chronically poor. Or, consider a person with a huge annual salary who consistently runs minor deficits. Let’s use some numbers. This person earns $995,000 per year but spends $1,000,000. This deficit-running-person is in debt, but hardly poor, and definitely better off than the person running the surplus.
I just can’t make this any clearer, Kerry. I’m not talking about refusing to trade. I’m only talking about increasing our self reliance. I’m describing a point about in the middle of a continuum, and you keep pretending that I (and others) occupy the most extreme possible point on that continuum. That’s just not so.
The problem with Walmart, as opposed to other low-wage big box type stores, is that it is so huge that it exerts downward pressure on wages in other companies across the world. I am a frugal type and so I used to shop at Walmart, as shopping ambience is something I do not give a hoot about. Now, I avoid Walmart because I can afford to, and I believe they have a negative impact on our society.
Kerry,
This attitude about deficits is not only harming our country but also families all across the country. Ask any of those folks who got interest-only loans whether deficits are a good thing to have…
In the short term, you are correct. One can spend slightly more than what you have and do okay. In the long term, it’s a very bad strategy. I’d even wager that in most severely poor families you will almost never find even a small and regular surplus, but you will almost always find quite a bit of debt. One thing is certain, you can’t continually increase your debt without there being future consequences; especially when most of that money you own is to countries like China with often questionable political objectives.
Also, your point about countries receiving the surplus is flawed too. It assumes that the average person in China is reaping the benefits of the increase in the number of products we buy. If instead, that money is clustered into the hands of a few people or multinational corporations, then there is no certainty that that money will ever fall back into the hands of average Americans via future trade.
Likewise, having goods doesn’t make you wealthy per se unless it actually raises your standard of living (or unless you can resell it, or use it to make money). Besides, many products are merely consumed and then gone. Once they are gone, they can hardly be counted as “wealth” anymore. Either that, or products can be made of inferior materials, or with inferior workmanship, and then break. Once again, a broken pile of plastic doesn’t contribute to our wealth. In fact, a brief tour of Wal-Mart will reveal very few products that could reasonably be considered investments per se.
Another danger of relying on free trade to solve all our problems is that it undermines the sovereignty of nations. For example, we might decide that we think child labor is unethical so we pass a law saying that children can’t work in factories. If we’ve no ability to limit trade, then a company will just move to another country where child labor is legal, thus undermining the legislation. The only way to have fair trade is to hold other countries to a similar legal standard. There have been many real world incidents ranging from environmental to human rights legislation where “free trade” has trampled the ability of nations to pass reasonable laws. That said, free trade is a valuable and important tool, even one which can promote significant reform in countries like China, but it can’t be completely without restriction.