Submitted to Mr. Garrioch
By Lee Kangbok
Student ID: 111087
For: English writing assignment
On: Wednesday, March 07, 2012
In modern American society, Wal-Mart has great power within the local economy. “Save money. Live better.” This is the slogan of Wal-Mart. Wal-Mart always tries to sell products at a low price with lots of quantity. However, not all people agree that Wal-Mart is actually beneficial for the economy. There are many critics toward Wal-Mart who declare that Wal-Mart puts small stores out of business. I personally believe that Wal-Mart’s disadvantages overwhelm its advantages.
Of course, there are lots of supporters of Walmart. According to the article "Wal-Mart Is Good For You," the conclusion of a report just released by the Federal Reserve Bank of Minneapolis showed that between 1985 and 2003, personal income, overall employment, and retail employment grew faster in 89 counties with a Wal-Mart in its region than in those counties without one. In addition, Ohio University professor Richard Vedder even says that “Wal-Mart has been at the forefront of productivity boom.” Advocates suggest that this Wal-Mart effect shows that Adam Smith’s idea -- that an exchange of goods at low prices benefits everyone – was probably right because low price brings more choices to consumers. Moreover, they suggest that the idea of Wal-Mart wiping out local jobs and depressing wages is wrong. According to Tom Van Riper, findings suggest the opposite: firm growth, employment and total earnings were stronger in Wal-Mart counties. Also, retail was historically a sleepy industry that has lagged on a productivity curve. However, during Wal-Mart’s march to dominance in the 1980s, retail was encouraged to enter to the lower price competition. Furthermore, the health plan of Wal-Mart is beneficial for all workers. 90% of workers are covered by a health plan and that’s in line with the industry average.
These are the advantages of Wal-Mart that supporters of Wal-Mart suggest. However, according to the article "Does Wal-Mart Destroy Communities?" a recent poll on CNN’s website shows that most Americans feel that Wal-Mart stores are “bad” for “community.” Take, for example, the anti-Wal-Mart content of a speech recently given by Teresa Heinz Kerry, John Kerry's wife and an influential person in her own right. Speaking at a Democratic Party rally, Mrs. Kerry declared that "Wal-Mart destroys communities." According to William L. Anderson, an economy teacher, critics strongly claim that Wal-Mart is guilty of the following facts. First, Wal-Mart pays low wages to workers, and generally abuses them. Second, Wal-Mart purchases low-priced goods from abroad, which puts American workers out of jobs. These two facts are the main reasons for the “low prices” of Wal-Mart. Third, Wal-Mart puts small stores out of business, as shoppers stop patronizing the little “mom-and-pop” boutiques in favor of big box retail outlets. And finally, they contribute to those allegedly harmful diseases known as “consumerism.” In a recent article, “Always Low Wages”, Brian Bolton declares that the company’s employee pay scale is not up to Sojourners’ standards. He suggests that “lower prices equal lower wages.” Of course, the choice is from consumers. They freely chose to buy products at Wal-Mart at a very low price. However, it is true that within the near area of Wal-Marts that local stores are unintentionally forced to close. Wal-Mart is suppressing the rights of workers not only by always paying low wages, but also by following a ridiculous system that is related to health care insurance. According to Jessica Wohl’s article "Wal-Mart trims some U.S. health coverage" Wal-Mart will increase health care costs for tobacco producers. Also, they will change their health plan to not provide health care insurance for new part-time workers unless they work more than 24 hours a week. As I mentioned earlier, advocates of Wal-Mart say that Wal-Mart is keeping the rights of workers by covering 90% of workers in a health plan. However, the reality is they will not provide a health plan unless workers work hard to become unhealthy. Thus, this is totally a contradiction and they restrain workers.
To conclude, I personally think Wal-Mart is a destroyer of the economy because of two big reasons. First, they destroy local community stores. Second, they repress workers’ rights. Advocates suggest that Wal-Mart was the center of an economic boom. However, it doesn’t explain anything since these phenomena may suggest that Wal-Mart was established in the places that were expected to grow more. If local economy was destroyed, Wal-Mart will be the monopoly and this will cause great harm to society. In addition, they don’t guarantee workers’ right. Therefore, Wal-Mart is a destroyer of economy and they should be banned to expand their area all over the world without any restriction.
Work Cited
William L. Anderson. 05,01,2004. Ludwig von Mises Institute. 03,04,2012 <http://mises.org/daily/1521>.
Tom Van Riper. 01,10,2008. Forbes. 03,04,2012 <http://www.forbes.com/2008/01/09/walmart-retail-economy-biz-commerce-cx_tvr_0110walmart.html>.
Jessica Wohl. 08,21,2011. Reuters. 03,04,2012 <http://www.reuters.com/article/2011/10/21/us-walmart-idUSTRE79K43Z20111021>.
