The national employment report issued last Wednesday showed that the private sector shed 522,000 jobs last December. This is out of a total workforce of around 140 million. Circuit City is gone. Macy's is laying off. Home Depot is laying off. Microsoft is, Google is, Harley Davidson is. So are Sears, Caterpillar (30,000), Kodak, Boeing, and Starbucks. All these companies are depriving workers of a job. Guess who isn't?
WalMart. Thus far WalMart hasn't had layoffs, despite some noise I've heard about lighter hiring at distribution centers, which would make sense as the company is trying to hold less inventory. WMT announced today same store sales were up in January, mostly from food sales.
WalMart has 1.4 million employees at its 4000 U.S. locations. These employees have one thing in common. A job. Maybe not the most rewarding job in the world, but a job nonetheless. There's a reason they call it "work." There is an upward career path there, if you want it. I know a young lady with only a high school education who earns $75,000 at WalMart. That doesn't happen at the New York Times or Time Warner. Or the SEIU.
WalMart's critics continue to argue that WalMart should increase its wages from its $10 per hour average. When the economy is at full employment, fine, argue these points, it's a problem of prosperity. In this economy, the arguments are moot. The only important fact is that WalMart employees still have jobs. They are not drawing unemployment. They are putting food on the table. In this environment, it doesn't really matter what your job is, as long as you have one.
Because of what I do for a living, I get to talk to some of the smartest people around. The smartest of these agree on one thing. This is not a recession. This is a depression, and it will probably last for at least a couple of years. I know it's kind of hard to wrap your mind around this, but then again, if I had said a year ago we would be nationalizing banks and there would be no more investment banks, I would have been called insane. Things really are that bad. A Fed governor told me at a conference recently that they can't save everyone, and he worried insurance companies are the next to fall.
Only two stocks in the Dow Jones Industrial Average were up last year. McDonalds and WalMart. Both serve the needs of people who don't have much money. Both had elitist movies made about them, vilifying them. I made a movie defending WalMart, because I just couldn't believe, with all the problems in the world, people would protest a fucking store.
In the recent sports documentary Running The Sahara the filmmakers stumble upon a 7-year old boy in the middle of the desert, completely alone, with no shelter, water, or food, sitting patiently waiting for his father to come back from a two day walk to get water. People live like that right now. Today. And we're protesting a store that would be a dream to that boy.
In September 2007, which is when I believe the economy turned south, Walmart stock started advancing for the first time in years and Target stock started declining for the first time in years. Target may be upscale, but their customers voted out of there with their feet. Now Target is laying off. WalMart works in a depression.
Millions of people need WalMart to live the way they want to live. People are motivated primarily by self-interest, and they decide, 130 million times per week, that the best choice for them, unglamorous as it may be, is WalMart. The people protesting WalMart are not the ones who need to shop there. Yet.
Bruce Springsteen said this week he was sorry he let his new album be sold in WalMart. That would be the album for which he got upwards of a $5 million upfront guarantee from the company. Bruce cashed the check, he's the employee, not the boss. He is an ingrate for trashing the company that is enriching him. Walmart worked for the self-interest of Bruce. Why protest the fact that the company works for the 56% of our population that shops there, and the 1.4 million who work there?
Many of the people in charge of the SEIU funded anti-WalMart movement, such as the imposing Buffy Wicks, have moved on to work for Obama, who was also funded by the SEIU. In a full employment economy, fine, try and unionize WalMart through cardcheck. Just don't try and do it in a collapsing economy.
I believe Walmart is not a store, it is a highly evolved computer algorithm that drives production of goods (creating jobs) by efficiently distributing them and saving consumers money. If you look at a superstore from high above, it strikingly resembles a computer chip with inputs (supplier trucks), outputs (shopping carts), and internal processing which determines prices and quantities of goods in a constant reinforcing feedback loop. They have the most efficient retail model in the world, and ironically that model is working best when people need it most.
D&B estimates WalMart is responsible for 5 million jobs, if you combine their suppliers of goods and current employees. We need those jobs. That is 4% of our total employment. WalMart is 9% of all retail sales. We need the savings their efficiencies create, and the jobs created by making and distributing those goods.
But what about wages, China, health care and the other problems associated with WalMart? Right now those issues, though they exist, are secondary. Only jobs matter. Jobs making and selling goods people need at prices they can afford. In today's economy, only WalMart is succeeding at this. Ask Target, Macy's, Circuit City, Best Buy, or Goody's. WalMart works. And it doesn't need bailout money to do so.
BTW please note that I, your humble writer, was named "Person Of The Week" by the respected anti-WalMart group WalMart Watch for calling out the company regarding their planned wage caps. The company and their PR firm Edelman were not amused. I also withdrew my film from distribution because I thought it was too one-sided. In other words, I don't have a dog in this hunt.
But at this point, picking on WalMart is folly. We're in a depression. We can't afford the protests. Who benefits the poor more, unions or WalMart? Look back at Katrina and ask yourself who helped more people quickly and efficiently, the government or Walmart? Affordable prices, no layoffs, no bailout money, job creation. It may not be a pleasant thought for some, but given the economy one thing is for sure:
We're all WalMart shoppers now.