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April 26, 2004

Why SEIU's Debate on "Walmartization" Matters

The Service Employees International Union (SEIU) is launching what could be its most important campaign, a community-based network called Justice at Work to combat the "WalMartization" of the economy. (Also see the first substantive post here by Andy Stern, head of SEIU).

The idea is to work with a broad-based network, organized using online tools - a la the Dean campaign - to take on corporate targets like Wal-Mart that no union or even the union movement collectively can take on without broad-based alliances.

For the next few weeks, on a daily basis, the SEIU blog will be encouraging an Internet-based dialogue on:

  • what the problem with "Wal-Martization" is?
  • how SEIU can best work with community alliances?
  • and what message needs to be taken to the public to win?

    My basic view: I'll be adding to the debate day-to-day, but let me lay out my basic view on what's wrong with Wal-Mart.

    It's hardly that Wal-Mart is unique. In fact, that's the problem. Wal-Mart is part of a much broader trend of corporate abuse of workers.

    And it's not that Wal-Mart is a large corporation. If anything, large companies like AT&T and General Motors were a more dominant part of the US economy back in the 1940s and 1950s, yet those were periods when workers made great gains in wages, benefits and work conditions.

    And it's not that Wal-Mart offers low prices. Henry Ford was very dedicated to lowering the price of cars to make them affordable. That Wal-Mart similarly uses new technology and a certain kind of standardization to try to keep costs down is hardly a bad thing.

    No, what makes Wal-Mart pernicious is that, where Henry Ford saw that paying his workers well meant that they could afford to buy the cars he made (and as importantly, buy other goods that drove growth and higher wages at other companies), Wal-Mart pays wages that leaves their own workers so poor that many of them can't afford even Wal-Mart's low prices or enough to take care of their families, period.

    Wal-Mart then drives down wages not only for its own workers but in the companies which compete with Wal-Mart, such as the grocery store chains which just fought tooth-and-nail to kill benefits and wages for new hires in the recent contract strike in southern California.

    So unlike Ford's virtuous cycle of decent pay in the car sector driving demand and higher wages in other sectors, Wal-Mart is encouraging the reverse, a race to the bottom in wages through competition for bad jobs.

    But the problem with Wal-Mart is not just in its role as a US retailer.

    The Real Problem: Wal-Mart is the world's largest manufacturing company. Period.

    Don't look at Wal-Mart and think of it as the successor to Woolworth or K-Mart. It is the direct successor to General Motors, General Electric and the older corporations that made the goods, not just selling them, for the American public.

    Officially, Wal-Mart "buys" its goods from other manufacturers, just like your classic retailer, but Wal-Mart is really just hiring contractors who make the goods to its specification. Wal-Mart's relation to its global factories is like how Nike relates to its shoe factories-- it doesn't have to own them since they do what it wants exactly how it tells them to operate.

    And what Wal-Mart tells its captive subcontractors to do is lower prices and lower wages. But with the global factories, you aren't talking about the horrible $6.50 per hour jobs in the US being under pressure to be even worse. No, you are talking about workers in Indonesia making a dollar a day being told they are losing their job, so that wages can drop to fifty cents a day in China. You are talking about Mexican workers losing their jobs, so those Wal-Mart subcontractors can meet the company's demand for even lower-paid workers.

    You are talking about a global race to the bottom, where workers paid to make the goods people buy in Wal-Mart could not even imagine shopping in those stores.

    The Solution: Well, that's what people will be talking about in the next few weeks, but the basics are always the same.

    Organize. Organize. Organizing.

    Do you refuse to shop at Wal-Mart? If you do it on personal whim or as a sign of personal virtue, you aren't really helping much.

    To make a company like Wal-Mart, or similar companies, clean up their act, it will take unions, community organizations, and just random folks to work together, plan a real strategy, coordinate actions from boycotts to pickets to protests, and recruit more and more people to help.

    Don't mistake the stakes in this dialogue. Defeating George Bush in November is a minor, much less important battle. If Kerry wins the Presidency but Wal-Mart wins the economy, we are worse off than if George Bush wins but the Wal-Marts of the world are defeated.

    Of course, defeating George Bush will help remove some of the anti-labor policies that allow Wal-Mart to abuse its workers and get a free pass to abuse them in China, but it's not enough.

    A President Kerry won't save anyone on its own; to take advantage of any improved political and economic climate will take serious organizing that will be a lot harder than planning for any single election day in November.

    So join the emerging Justice at Stake dialogue and help plan the future.

    You have nothing to lose but the chains of low wage exploitation and that annoying smiley face :)

    BTW Andy Stern, head of SEIU, has a new opening post on approaching the problem of Wal-Mart. His basic first question is: Do we throw all our resources at Wal-Mart, or do we build in other corporate targets as well to an overall campaign with Wal-Mart at the center.

    To me the answer is obvious-- Wal-Mart is the exemplar of a problem, not its only practicioner. And many activists who are concerned don't have a Wal-Mart nearby, but will want to be involved in a multi-faceted campaign, so you need subsidiary targets.

    And frankly, Wal-Mart is a collossus. We won't win against them out of the box, so taking out some smaller targets, helping some workers along the way, is the best way to encourage more and more people to join the campaign.

    Posted by Nathan at April 26, 2004 07:35 AM