"Death by a thousand cuts" Wal-Mart style

Sometimes the press manages to find a voice. All at once we have three articles in the LA Times (sorry no link, its subscription only), an article in the SF Chronicle and then another in Fast Company. The Fast Company article gives the best run down on how Wal-Mart affects its suppliers, the LA Times ones focus on the people effect. Either way I think they tell all you need to know to make an informed decision about whether to shop at Wal-Mart.

Except... do they?

Just try to balance in your head spending 50-100 billion dollars to aid a small nation like Iraq, with sending equal if not larger amounts to aid overseas countries by buying products from the businesses. It may seem like an unfair apples and oranges comparison but is it really? After all, when it comes down to it, wasn't the major complaint with Iraq (the undiscovered WOMD not-withstanding) that they just weren't buying our commerce based democracy. So if Wal-Mart had somehow managed to find a way to suck Iraqi businesses into their vast all encompasing supply chain do you think we would be at war with them now? Wouldn't the Wal-Mart way be a better way to get cozy with our neighbours than the US Army death-or-glory way?

Probably the biggest beef I have with the Wal-Mart effect is that they feed purely on the all American instinct for shopping and getting the best deal. But Wal-Mart shoppers typically have no idea about what goes on behind the curtain and where most of their products come from and what the consequences of embracing the If they did would they truely shop elsewhere? Do they even have any choice not to? I guess they were doing okay before Wal-Mart comes along, and briefly afterwards (as one comment about the Fast Company attests) they may find themselves continuing to spend the same or more but buying even more. Wow - more bang for my buck, isn't Wal-Mart wonderful! However eventually the supply chain squeeze and the lower wages squeeze takes effect and the downward spiral begins to set in.

And finally, all those profits (billions and billions) go into the shareholders pockets, not the workers. Ask yourself this: do you think Wal-Mart would do business with another business as big and profitable as Wal-Mart? No, it would probably tell itself its profit margins were too high and that it should go cut its profits somewhere. But what would that mean to an end of chain seller? It would mean charging lower prices (wow, even lower prices!) or paying its workers and suppliers more. So if Wal-Mart is so great why doesn't it become a profit-sharing company and handed out a signifcant amount of it profit as a dividend to its employees and shoppers - just like REI does at the end of the year. That might go some way to shovel all of that wealth it generates back into the economy and help sustain a viable shopping mass.