The silly war against Wal-Mart

Posted: Apr 08, 2004 12:00 AM

   Sam Walton, the founder of Wal-Mart, died in 1992. Little did he know he would be remembered in certain quarters as a kind of corporate criminal. His offense? Starting a business that has brought convenience and low prices to the countless millions of Americans who roam Wal-Mart's deliriously overstuffed aisles.
  If that seems innocuous enough, you aren't familiar with the political, economic and cultural fault line of post-millennium America. Wal-Mart, an unabashedly capitalist and bourgeois "red state" institution, is on the wrong side of that divide for self-styled progressives. Wal-Mart might as well have been Halliburton during the Democratic primaries. It was the target for potshots by John Kerry, John Edwards, Howard Dean and, yes, Dennis Kucinich.

    The latest front in the Wal-Mart Wars was in the Los Angeles suburb of Inglewood. Activists screamed about a Wal-Mart proposal to build one of its superstores on 60 barren acres. Replacing barren acres with almost anything short of smut shops or crack houses would seem to be a good thing by definition, but not by the twisted logic that obtains when Wal-Mart is involved. The City Council, then voters in an April 6 referendum, stiffed the store. In response to Wal-Mart's broader plan to build 40 new supercenters in California, opponents are mobilizing a coalition that includes the Nation of Islam and the once-grand civil-rights group the Southern Christian Leadership Conference. How everyday low prices violate civil rights is a mystery.

    In the latest issue of National Review, writer Jay Nordlinger undertakes a spirited defense of Wal-Mart, which is the nation's first politically incorrect discount retailer. As Nordlinger writes, Wal-Mart is a standing affront to the Left, partly because it is so "gloriously, unabashedly, star-spangledly American." He knocks down the canards on which the anti-Wal-Mart case is built, most importantly that the store is a ruthlessly exploitative employer.

    More than 90 percent of Wal-Mart employees have health insurance. Half of those get their insurance through the company, and the rest through other means, whether their parents, or spouse, or Medicare. Many Wal-Mart employees are young people or semiretired, and thus aren't supporting families. Employment there can be an escalator to success. Two-thirds of the stores' managers are former hourly employees.

    Meanwhile, the competition howls about Wal-Mart for good reason -- because it almost invariably gets out-hustled, out-discounted and altogether out-retailed. FAO Schwarz, the pretentious toy seller, has nearly been bludgeoned out of business by Walton's creation. Such is the cost of selling over-priced toys in the age of Wal-Mart. Yes, the killer store snuffs out charming local retailers, but most consumers simply value convenience and low prices more than charm.

    All across America, shoppers have voted with their cash and charge cards. Almost a third of all disposable diapers and hair products are purchased at Wal-Mart. No other store sells more groceries, toys or furniture. This is a boon for lower-income Americans who spend a disproportionate amount of their income on retail goods. As a Federal Reserve economist has said, "Wal-Mart is the greatest thing that ever happened to low-income Americans."

    The store is also part of the wondrously flexible and various American job market. "The Europeans sniff at our job creation," CATO Institute economist Brink Lindsey tells Nordlinger, "while their job market is stagnant. They say, 'Oh, America just has Wal-Mart-type jobs.' Actually, the percentage of managerial and professional jobs in our country has climbed steadily. Yes, we have a lot of low-end jobs, but we have a lot of young people and older people in our work force, unlike Europe. There, they don't let people get hired, they don't let industries move fast, they don't create jobs."

    If Wal-Mart seems unstoppable, there is one force that will be its undoing, and it's not angry protests. Instead, it is the market. Eventually, some retailer will be more nimble and cunning than even Wal-Mart, and it will get -- as all businesses in America do -- its own capitalist comeuppance.