Corporatism, Wal*Mart, Halliburton and the Free Market
We are all familiar with the Wal*Mart affect -- the terrible destructive forces wrought on smalltown America whenever a new Wal*Mart is opened up. At it's elementary and base form, the free market capitalist system is designed for the efficient production and consumption of goods, and the equitible distribution of goods and services. The operating procedures of the Wal*Mart corporation go so far beyond what John Adams originally envisioned -- in the end, Wal*Mart has a net destructive affect on American Society, on the cities that are drained by the devastating affects of the corporation, and on the lives of individuals who grow dependant on corporation.
When a new Wal*Mart location opens, it puts a huge financial squeeze on every other business in the neighborhood. The individuals who choose to shop at Wal*Mart cannot be blamed for this. This is a cyclical process wrought by the Wal*Mart effect. Individual stores simply cannot compete with the low cost and one-stop convinience of a Wal*Mart Megastore. Soon, all competitive business in the area is wiped out, and the people of the community who originally operated mom and pop shops now find themselves working the Wal*Mart till. With a low paying job, the people working at Wal*Mart most often have just barely enough to make ends meet, so they do all of their major shopping at Wal*Mart.
How does Wal*Mart offer such low cost goods? Primarily by underpaying their employees and selling cheap, low-cost imported goods, increasing the massive US trade deficit by a large margin. The majority of the hourly sales workforce at Wal*Mart earns less than $8.50 an hour, putting them below the official poverty line for a family of four.
The United States ran a $600 Billion trade deficit last year, making many foreign investors weary of any further investment into the US economy. Every year, the future of the United States is mortgaged, and Wal*Mart has had a large hand in mortgaging the future of this nation. Consider the following from Factline:
- Wal-Mart global sales, 2002: $245 billion
- Wal-Mart sales of U.S.-made goods in foreign stores, 2002: $500 million
- Wal-Mart foreign sales of U.S.-made goods as share of total Wal-Mart global sales: 0.002 percent
- Wal-Mart imports from China alone, 2002: $12 billion
Wal*Mart has been a continous and vehiment opponent to the unionization effort of Wal*Mart employees. A Wal*Mart store in Canada became the first to attempt to unionize, and was rewarded with the closure of the store. Wal*Mart recently settled for a sum of $240,000 over accusations of abuses of child labor laws. Wal*Mart has been accused of locking employees into the building at night to prevent looting of goods.
In the end, Wal*Mart is a prime example of why unfettered de-regulation and unwavering belief in the free market is plain foolhearty. As a democracy, we of the United States should have the ability to generate laws and regulations that benefit the common good of the people - not only the CEOs, VPs and rich of this country. The Bush Administration is responsible for passing many regulations that ease regulation on corporations, and destroy the rights and freedoms of the individuals that make up the fabric of this nation. By lowering corporate taxes, eroding environmental regulations, and rewarding, let alone allowing, malevolent corporate behiviors, such as outsourcing, offshoring, downsizing, mega-mergers, and massive layoffs, the Bush Administration is rewarding behavior that is counterproductive to the needs of 99.9% of the US population.
There is simply no reason that the Wal*Mart corporation should be able to simply write off a lawsuit as a business loss when caught breaking child labor laws. $240,000 is a pittence for this offense -- the combined net worth of the Waltons alone is over $90 Billion - for them, this settlement is little more an inconvinience than a parking ticket would be for the average American citizen. There are times when an individual will park at an expired meter and risk paying the fine, simply because the cost is not worth the effort of trying to find another parking spot. Similarily, large corporations consider lawsuits and fines brought on to them as simply operating expenses, often ignoring labor laws and environmental regulations because it is not worth the effort.
Stronger and more stringent regulation is needed. Ignore the cries of the neoconservative movement -- Hearing Bush mention the words "Frivolous asbestos lawsuits" makes my blood boil. Especially when you consider that the major industry player mired in Asbestos lawsuits is Dresser - a subsidiary of Halliburton. Halliburton was itself just caught in another scandal - after getting caught conducting business in Iran last year, it was just revealed that Halliburton recently just struck another deal with the terrorist state - this goes entirely against US corperate law. This is a company that is committing crimes - yet the Bush Administration chose to reward them with over ten billion dollars in no-bid contracts in Iraq.
In the end, what we need is common sense. In general, free market forces do a good job in the efficient allocation and consumption of goods and services. In some cases, privatization is simply not a good choice. For reasons I cannot get into today, privatization of health care is simply a bad idea -- perhaps I will explore that subject at a future date. Privatization of Social Security is an equally bad idea. In some cases -- such as the development on a nationwide renewable energy policy -- the benefits to our nation as a whole should outweigh an unwavering belief in the benevolance of the free market.