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Nicholas von Hoffman on ‘The Big Squeeze’
Posted on Jun 6, 2008
No book on this subject can skip Wal-Mart, the largest employer in the United States with 1.3 million-plus workers, whose average pay last year was $1,500 under the poverty line for a family of four. Greenhouse devotes a chapter in his book to the company, pointing out that its effects and influence are enormous. Business schools hold it up as the ideal way to run a business, and competitors are forced to adopt its practices because of its size alone.
Anyone who has walked into a Wal-Mart is aware of the size of the individual stores, but the stores themselves do not begin to hint at the dimensions of this organization. “Its sales represent an astonishing 2.6 percent of the nation’s gross domestic product,” Greenhouse writes. “It is three times as large as the world’s second-largest retailer, Carrefour of France. Its sales are greater than the combined sales of Target, Sears, Kmart, JCPenney, Kohl’s, Safeway, Albertson’s, and Kroger. Some retail consultants predict that it will become the world’s first $1 trillion company in a dozen years. Each week 130 million shoppers visit its 4,000 US stores, and each year 82 percent of American households shop at Wal-Mart. It is the nation’s largest grocer, and will have 35 percent of the nation’s food market and 25 percent of the pharmacy market by the end of this decade, according to Retail Forward, a consulting firm. Wal-Mart already sells one-third of the nation’s disposable diapers, toothpaste, shampoo, laundry detergent, paper towels and nonprescription drugs, and some say it could soon capture a 50 percent share for those products.”
It may also be the world’s biggest crook. It forces its workers to labor off the clock for no compensation. It locks them up overnight to make them restock shelves, etc., for free. It hires illegals via subcontractors. It discriminates against women. It violates the child labor laws. It cheats and uses short cuts in more ways than there is space to enumerate. So massive is the indignation at what this behemoth does that a small but vigorous anti-Wal-Mart industry has sprung up to try to throw a halter on the beast, with but indifferent success.
In a time of shrinking purchasing power, Wal-Mart’s low prices have been a godsend for millions, but at the rate things are moving, millions won’t have enough to buy even at Wal-Mart. Greenhouse makes a point of demonstrating how Wal-Mart’s arrival in a community depresses everybody’s wages throughout the area. So the question is: Do people save more or lose more because of Wal-Mart’s arrival?
A case can be made that Wal-Mart’s executives long since should have been arrested and taken out of their Bentonville, Ark., headquarters in handcuffs, but they have escaped having to answer for what their company does, much as other business people do who break the nation’s weak labor laws, whether that be by cheating employees of their pay or forcing them to labor under unhealthy conditions or chiseling on workmen’s compensation, etc. Workers who steal get caught and prosecuted; the men and women they work for do not.
Greenhouse discusses a number of ways of lessening the big squeeze’s pressure on people in the face of free trade and massive immigration. To name a few, he has hopes for raising the earned income tax credit and would change the law to make corporations like Wal-Mart criminally liable for their contractors’ labor law violations. He tackles the question of the courts blessing settlements of suits against companies that pay in secret without admitting how they have screwed their workers. He would have the government send some executives to prison for crimes against their employees, just as they are jailed for crimes against their stockholders. All good suggestions with some hope of congressional enactment if the Democrats get in and the lobbyists do not get to them first.
Among Greenhouse’s many suggestions is the revival of union power and membership. The deck is so stacked against the lone, unorganized, unprotected employee that the squeeze is only going to get tighter. Collective action for Americans indoctrinated for decades with the conviction that lack of money is a character flaw is a hard sell. A rebirth of trade unionism also depends upon major changes in federal government policies. For that to happen, Greenhouse recognizes, the National Labor Relations Board would have to be pried away from business control and laws governing union organizing and tactics restored to something like what they were in the New Deal period.
If enough people read “The Big Squeeze,” that may come to pass. Well researched and written to be easily read, this book should get people out from in front of their flat-screen HD television sets to try to do something about what has been happening to us and our country.
Nicholas von Hoffman, a former columnist for The Washington Post and a former commentator for CBS’ “60 Minutes,” is a regular columnist for The New York Observer. He is the author of numerous books, including “Hoax: Why Americans Are Suckered by White House Lies” and “Capitalist Fools: Tales of American Business From Carnegie to Forbes to the Milken Gang.”
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