The Question We Should Be Asking About Walmart

It already seems like an age-old question: “Has Wal-Mart been good or bad?

This week, The Washington Post's  Ezra Klein is the one asking and weighing the costs to Walmart’s workforce, its supply chain, and its competitors against the low prices the store offers consumers. He asserts:

I never came across an accounting I found sufficient. Whether Wal-Mart has been, on net, “good” or “bad” is a complicated question to frame and a devilishly tough one to answer.

It may also not be the most helpful or relevant question to ask.

 

The reality is Walmart is with us for better or worse. Imagining what a Walmart-free world would look like is an interesting exercise, but it’s not the one that brought Walmart workers and their allies to the picket line in a hundred cities on Friday. The question they were striving to answer is closer to the one the National Employment Law Project’s Annette Bernhardt asks: “what kind of Walmart do we want for our country?

After all, the same company that was a leader in off-shoring jobs  and dragging retail wages down could lead the retail sector, and the country, down a different path.  And as my colleague Catherine Ruetschlin explained in this space last week (and discussed in more depth in her recent study), low wages are not required for low prices.

Looking at Walmart specifically, a 2011 study from the Berkeley Labor Center found that if the company raised wages for all employees to at least $12 an hour, the average Walmart consumer would pay just 46 cents more per shopping trip or $12.49 per year. Meanwhile low-income Walmart employees would see their wages lifted by as much as $6,500 a year. Looking at America's large retailers as a whole, (and using a slightly different set of assumptions) Demos finds that consumers would pay just 7 to 15 cents more per shopping trip ($8.87 to $17.73 per year) for a wage increase sufficient to raise 1.5 million retail workers and the family members they support out of poverty or near poverty. The wage hike would also boost GDP and create jobs.

As the data indicates, the low wages vs. low prices debate is a false choice. Tomorrow's Walmart (or for that matter, tomorrow’s Amazon.com, which Klein notes is also transforming our economy and is engendering its own push for improved working conditions) could take the nation along a higher road that benefits both workers and consumers, not to mention the economy as a whole.

When we ask instead what America’s largest employer—and the fast-growing retail sector that it dominates— should look like going forward, it leads us not to a “devilishly tough” debate about past impact but to one about what can we do as workers, consumers, shareholders and democratic citizens to shape that path.  This is the question we should be asking and striving to answer.

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