About This Blog
I do not shop at either Wal-Mart or Sam's Club. Ever.
On Black Friday I visited my local Wal-Mart parking lot to see if there were any Wal-Mart workers out front protesting the company's miserly treatment of workers on Wal-Mart Worker Walkout Black Friday. There weren't. And that's too bad because the piddling amounts paid out by the mammoth retailer to it's workforce.....should be of greater concern to all of us.
As of 2010, the Walton family, who originally launched Wal-Mart in Arkansas, is worth $89.5 billion....or the equivalence of the cumulative net worth of 48.8 million U.S. households.
The average annual salary of a Wal-Mart sales associate is $15,500. Average hourly wage for a Wal-Mart sales associate is a whopping $8.81 per hour. It is estimated that if Wal-Mart would raise their minimum sales associate wage to $12 per hour, Wal-Mart customers would pay on average an additional 46 cents per shopping trip to the store. 46 cents.
I haven't recently fallen off the back of a turnip truck.....so I realize that Wal-Mart will never change it's ways. Consumers may change their ways.....but not Wal-Mart.
Single-handedly, Wal-Mart accounts for over 11% of our world trade deficit. Wal-Mart tells China what that country is going to do for them.....and China does it. Exploiting cheap Chinese labor and paying U.S. sales associates peanuts is but a grand redistribution scheme which leaves out all but a few Americans. A redistributionist scheme which takes the savings from paying meager Chinese wages and redistributes those savings to shareholders, the Walton family being the largest.
In a way, Wal-Mart is the benchmark for what has gone wrong in the U.S. economy over the last 3 decades. Trading higher paying U.S. jobs for cheaper foreign labor has done damage to the overall workforce in the U.S. Fewer available jobs mean less demand for labor which means lower wages.
But it doesn't have to be this way. Example: Costco....big box discount retailer....
Costco’s average pay, for example, is $17 an hour, 42 percent higher than its fiercest rival, Sam’s Club. And Costco’s health plan makes those at many other retailers look Scroogish.
What about Costco shareholders?.....
Costco’s stock price has risen more than 10 percent in the last 12 months, while Wal-Mart’s has slipped 5 percent. Costco shares sell for almost 23 times expected earnings; at Wal-Mart the multiple is about 19.
What do Wall Street analysts have to say about Costco?
Wall Street analysts assert that (CEO) Mr. Sinegal is overly generous not only to Costco’s customers but to its workers as well.
One analyst, Bill Dreher of Deutsche Bank, complained last year that at Costco “it’s better to be an employee or a customer than a shareholder.”
See that last quote? That's the crux of our national economic problem. While Wall Street redistributionists have been making it "better" for a smallish group of U.S. shareholders......average income, hourly rates, and net worth of American working families has declined or remained the same. The huge economic inequality gap Americans have been experiencing has come about precisely because of this dynamic.
Two huge discount retailers. One whose workers are unionized, one who has closed stores over threats of becoming unionized. One discount retailer pays it's workers an average of $8.81 per hour, one pays it's workers $17 per hour. One loved by Wall Street skimmers and redistributionists, one isn't.
Costco's formula is a throw back to the days when the middle class in America grew and thrived. Those days made up our nation's best economic years. Wal-Mart's formula is an abandonment of America's middle class in favor of further enriching a tiny minority of investors....and is the poster child for everything that has turned sour in our nation economically in recent decades.
Our nation needs more employers, not less, whose motto is “it’s better to be an employee or a customer than a shareholder.” That is the way back to economic prosperity for all Americans.
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