Le Monde Diplomatique on Wal-Mart
Date: Friday, January 20 2006
LE MONDE DIPLOMATIQUE --JANUARY 2006
MULTINATIONAL SUPERMARKET THAT DOMINATES ECONOMIES
Wal-Mart, the new southern plantation
Wal-Mart is the world's biggest company, and the social dumping that has made such success possible is infecting western economies, especially labour relations and minimum pay rates. It buys cheaply and sells cheaply, but at a huge cost to communities all over the globe.
The American dream of upward social mobility, with its rags to riches leitmotiv, needs a constant supply of fresh stories to keep the myth alive. There was John D Rockefeller, a smalltime accountant in Cleveland, who became the world's most powerful oil magnate at the age of 31. More recently Steve Jobs left university without a degree to start his own computer company, Apple, in a garage; he was a billionaire by his 30s.
Now it is the turn of Wal-Mart, and on an even bigger scale. It started out as a small store in Arkansas, one of the poorest states in the United States; yet four members of the founder's family are now among the 10 richest people in the world. With sales totalling $310bn, the supermarket chain is the world's largest company (it overtook ExxonMobil in 2003) and the biggest private employer. Wal-Mart sells one in five of all CDs in the US, one in four tubes of toothpaste, one in three disposable nappies. Perhaps more significantly, it accounts for 2.5% of US gross domestic product (1). Wal-Mart has more financial clout and influence than 150 countries, but it could not have achieved its present powerful position without the favourable legislation passed by national governments.
With power on this scale it should come as no surprise that decisions at Wal-Mart headquarters in Bentonville, Arkansas, match most of the economic, social and political changes worldwide. Indeed the firm instigated some of them, and actively encouraged others. It has developed its own model: it leads the way in the fight against unions, relocates manufacturing, squeezes personnel, lobbies for the deregulation of labour laws and more free-market agreements. It puts pressure on suppliers to force them to cut costs, particularly payroll costs, and relocate outside the US. Wal-Mart's horror of time-wasting - "time-theft" in its corporate lingo - means that it is deliberately vague in its job definitions for workers, ensuring they are kept busy with an endless succession of tasks.
It constructs hideous buildings - the shoeboxes - supplied by a fleet of 7,100 giant trucks on the road, polluting round the clock. The priority is to keep filling the boots of the vehicles that line the immense car parks of its 5,000 stores worldwide. These too are part of the Wal-Mart model.