Simplistic arguments which are nonetheless essentially true

by on April 10, 2015 at 2:08 pm in Philosophy, Political Science | Permalink

Walmart critics embrace two moral standards: in the first, morality requires payment of high wages to 1.2 million people. In the second, morality can be achieved without employing anyone at all–that is, by paying zero wages. Most of us have chosen to live by the second standard, and from our lofty moral position we can criticize Walmart for not meeting the first standard. How convenient!
There is more here, from Ryan Decker, via Ben Southwood.

1 JWatts April 10, 2015 at 2:21 pm

Walmart has announced it is increasing the minimum wage it hires workers:

Walmart “said that all of its United States workers would earn at least $9 an hour by April and at least $10 by next February.”
http://www.nytimes.com/2015/02/20/business/walmart-raising-wage-to-at-least-9-dollars.html

“The persistent critics of Walmart said that Walmart has finally lived up to their standards. Oh wait, no that’s not what they said. This is what they said:
“Some labor advocates, however, who are demanding $15 an hour for service workers, called the plan inadequate.”

Personally, I don’t understand why they don’t demand that Walmart raise wages to $25 per hour. After all that’s the median household income in the US.

2 dmarkey April 10, 2015 at 2:39 pm

So true. Walmart is a beloved piece of American culture. We should pay Walmart employees at least $100 dollars an hour.

3 Devin April 10, 2015 at 3:33 pm

Decker contradicts himself by saying “…morality can be achieved without employing anyone at all–that is, by paying zero wages. Most of us have chosen to live by the second standard” later then saying “Walmart ‘transfers’ poverty assistance costs to taxpayers by paying workers less than some journalist thinks they should be paid.”

Either we are living by the second standard or not. As a taxpayer, and subsequently a contributor to the “safety net,” we are essentially paying Walmart employees. Taxpayers have a very good incentive to transfer as much cost as possible to the greatest beneficiary.

4 Urstoff April 10, 2015 at 5:01 pm

As Jason Brennan points out, it seems like it should be the taxpayers footing the bill for subsidies to the poor rather than forcing Wal-mart to foot it by paying above-market wages: http://bleedingheartlibertarians.com/2013/07/against-the-living-wagesubsidy-arguments/

5 TallDave April 10, 2015 at 11:52 pm

By that reasoning we are “employing” all low-income people, even if they are not working at all.

Paying someone is not the same as employing them. And if you want to talk about benefit, well, guess where the vast majority of the benefits actually go…

http://www.forbes.com/sites/timworstall/2013/08/11/walmart-destroys-jobs-yes-but-the-benefits-go-to-consumers-not-the-top/

6 FriedFish April 14, 2015 at 4:36 pm

Get a better job? Get a different job? Why do you treat this as if Walmart is the only place to work in this country?

7 dmarkey April 10, 2015 at 2:38 pm

One could argue that this is a philosophical argument: Walmart doesn’t pay wages — its customers do. Walmart can choose to pay more when customers are willing to pay more for the goods and services Walmart supplies.

8 Pshrnk April 10, 2015 at 5:07 pm

+1

When I shop at Walmart I am free to offer a donation to help raise employee wages.

9 Sigivald April 10, 2015 at 5:39 pm

It’d be interesting to see what would happen if there was a trivial at-register way to donate $N to “employee wages, across this store”.

I’d expect non-zero but still basically insignificant donations; after all, Wal-Mart’s target market is people who want to save money.

10 dmarkey April 10, 2015 at 7:30 pm

I doubt it would raise wages by more than a dollar. However, it would be interesting to see how the donations fluctuated with increased discussion of raising the minimum wage and negative reports about Walmart’s treatment of employees.

11 Alain April 10, 2015 at 8:31 pm

A dollar?!

I bet it would be far, far, less than 1 dollar.

12 mulp April 10, 2015 at 8:49 pm

Boy does WalMart have you snookered.

WalMart wants you to think you are saving money by spending $50 buying three times the amount of stuff you can consume reasonably when you needed only $10 worth of stuff, and all the “savings” will result in you eating three times as much as you should so you are saving $5 on the $15 meal that should have cost $5 if it were based on a healthy portion. You really are not saving money by eating a pound of meat ($15 marked down to $10) when you should only eat 6 oz, (at $5).

Ok, some people do save money at WalMart by sticking to the things that are only slightly cheaper, but most people “upgrade” from fresh veggies to jumbo packs of corn chips and corn dogs.

13 Dan Weber April 10, 2015 at 9:31 pm

Some of us are socialized enough to have families, and cook a pound of meat to split among all members of the family along with vegetables.

14 TallDave April 10, 2015 at 11:57 pm

You’ve confused Walmart with Costco. WalMart’s model is volume purchases, not quantity sales.

Also, Walmart is tremendously beneficial to the poor, who are typically very price-conscious.

http://www.forbes.com/sites/timworstall/2013/08/11/walmart-destroys-jobs-yes-but-the-benefits-go-to-consumers-not-the-top/

15 dan1111 April 11, 2015 at 1:07 am

This is ridiculous. How does Walmart force me to consume more than I need? I can buy 6 ounces of meat at the lower price and save money. If cheaper goods lead me to spend more, that is my choice. Walmart didn’t trick me into it.

16 Wilbur April 13, 2015 at 10:29 am

It’s not that far fetched.
That would the equivalent of a tip jar. Except that unlike in restaurants, this could be optional.
I doubt there will be much uptake but if it will assuage the guilt of some…

17 mulp April 10, 2015 at 8:40 pm

“One could argue that this is a philosophical argument: Walmart doesn’t pay wages — its customers do. Walmart can choose to pay more when customers are willing to pay more for the goods and services Walmart supplies.”

But WalMart recently stated that is sales were not growing because government was cutting back on food stamps and welfare benefits for its customers, which by the way includes WalMart employees, so according to WalMart officials, a significant portion of its workers wages are paid by government.

But unless you consider spending other people’s money to be sustainable, business growth and GDP growth has been driven by the financial innovation of profitably promoting spending other people’s money to consume more than you earn in wages.

This can be seen in the sharp upturn in growth of consumer debt since the early 80s with little pause. Prior to the 80s, government regulation prohibited most consumer debt by banks, thus manufacturers and retailers – GM, GE, RCA, Sears, Wards, oil companies, provided credit to customers that it tracked from within the community, with agents ready to go to its debtors to repossess the products sold on credit, or at least cut them off quickly.

I remember being turned down multiple times for credit because I only had a job and a lot of savings but no credit history, so I was forced to carry cash, unless I bought travelers cheques which were treated with great suspicion, but that were taken when personal checks weren’t and you had no cash and they wanted to make a sale. This was the 60s and 70s. Getting a “company” card which I was totally responsible for, was so fantastic – I now could buy things of value easily almost everywhere and then pay it off within 45 days, because it was not a credit card. I couldn’t get a credit card until Reagan made loan sharking legal and all the banks did it.

Of course, a very high portion of WalMart customers are in my position in the 60s and 70s – they can’t get credit, so they are on a cash or SNAP or welfare EBT card basis.

If all businesses emulate WalMart on low wages, then consumer sales will be stagnant, or fall if welfare is cut, and GDP will be stagnant per capita.

It is circular. If WalMart won’t pay workers more, WalMart customers will not buy more, but if WalMart pays more and that forces all other employers to pay more, then WalMart customers will spend more.

TANSTAAFL

18 Larry Siegel April 10, 2015 at 11:17 pm

>I couldn’t get a credit card until Reagan made loan sharking legal and all the banks did it.

Poor baby. I had a Visa, MasterCard, and American Express Gold Card when Reagan took office. Leave Reagan out of this, he had nothing to do with anything in your post.

19 HL April 11, 2015 at 11:10 pm

it wouldn’t be a mulp post without a ronnie raygun bend

20 John Smith April 10, 2015 at 2:40 pm

The objection isn’t that Walmart pays low wages to employees who would have otherwise had no job, it’s that their business practices have replaced 1.2mm relatively high paying jobs with 1.2mm relatively low paying jobs, the difference roughly being a transfer from workers to owners.

I don’t necessarily endorse that view, but I think it more accurately summarizes the moral objection to Walmart.

21 prior_approval April 10, 2015 at 3:10 pm

And the really amusing thing? When forced to compete in a market like Germany’s, Walmart lost an estimated billion dollars and went home – it seems as if Walmart isn’t anywhere near as efficient as it believes, a reality that gets obscured when you eliminate your small town competition.

The even funnier thing? Trader Joe’s, owned by Aldi, continues to earn a nice profit. It makes more than double Whole Foods revenue per square foot – Aldi is profoundly interested in efficiently earning as much money as possible, the German way. Which probably explains why they offer pay and benefits to its workers that a Walmart worker probably no longer even dares to dream about.

A company’s most important capital is its employees – a reality that Walmart seemed utterly unable to recognize, as it was mocked in Germany, both by the courts and the public, when attempting to forbid its employees from having romantic relationships with one another. Being a socialist hellhole, German law forbids employers from such ridiculous attempts to use an employment relationship to dictate who is allowed to have a relationship with who. Walmart probably would have left the German market in failure anyways, but as the timing worked out, it left with pretty much everyone in Germany laughing at its ludicrous management.

22 ladderff April 10, 2015 at 3:11 pm

What a bore.

23 Jeff R. April 10, 2015 at 3:19 pm

“A company’s most important capital is its employees”

Have you seen some of the people that work at Wal Mart?

24 Judah Benjamin Hur April 10, 2015 at 6:36 pm

There’s a huge variation in quality of employees at places like Wal Mart, including some fairly smart and helpful people. As for the workers worth no more than minimum wage, what’s going to happen to them when Wal Mart pays $10? I guess nobody worries about those folks, certainly not the crusaders for higher wages.

25 asdf April 10, 2015 at 3:23 pm

WMT has its employees subsidized by the welfare state. Nobody could live on WMT wages, but if they get assistance for food, healthcare, transfer payments, etc from the government then its a “living wage”. Taxpayers subsidize WMT’s business model.

26 Slocum April 10, 2015 at 3:33 pm

“Taxpayers subsidize WMT’s business model.”

So you believe we should abolish the Earned Income Tax Credit then on the grounds that it is a subsidy to employers? Is this the standard ‘progressive’ position now?

27 collateral April 10, 2015 at 4:44 pm

I’m with you I don’t really get the complaint. If you don’t want to pay welfare, don’t pay welfare. Don’t pay welfare and then bitch about the natural consequences.

It’s the same people that are all in favor of government healthcare but then bitch and moan about the supposed costs of insuring smokers.

28 msgkings April 10, 2015 at 4:54 pm

Name just two people of that group. Heck, name just one.

29 Urstoff April 10, 2015 at 5:04 pm

Apparently what progressives want is a minimum wage sufficiently high to live on and then straight cash transfers to all of the poor people that don’t have a job because of that minimum wage. Sounds like a veritable Utopia to me.

30 Sigivald April 10, 2015 at 5:45 pm

I’m with you I don’t really get the complaint. If you don’t want to pay welfare, don’t pay welfare. Don’t pay welfare and then bitch about the natural consequences.

That reminds me of Megan McArdle’s position on this, paraphrased below:

“You don’t get to vote for a welfare system and then refuse to pay for it.”

31 asdf April 10, 2015 at 6:05 pm

WMT advocates for bringing more low skill workers into the country knowing that it will drive down wages, but it won’t cost them because the government will pay for all the extra expenses associated with those people. It also engages in other anti-social business practices like bilking people out of overtime and buying the cheapest crap from China where there are no labor or environmental standards and the whole thing is only possible because we are running up an inevitably painful credit balance (again, subsidized by government).

You can’t separate WMT the company from WMT the lobbyist.

32 Peter Stone April 11, 2015 at 5:05 pm

As usual, progressives are wildly inconsistent. They certainly would never consider it to be “corporate welfare” when the employees of a business benefit from Obamacare’s health insurance exchanges. No. They get to pick and choose what constitutes “corporate welfare” or subsidies. The term is always used when it involves only those businesses the left hates, e.g. Walmart.

33 Shane M April 11, 2015 at 9:40 pm

re: “You don’t get to vote for a welfare system and then refuse to pay for it.”

There’s lots of things we’ve voted for that haven’t been paid.

34 Hazel Meade April 10, 2015 at 5:41 pm

This is a seriously stupid argument.
Do you think Walmart’s workers would get paid more if public assistance wasn’t available? Or that Walmart is going to pay more than their marginal productivity just because the workers need it more? They aren’t running a charity.

They will pay the market rate for labor. The market rate for labor is what it is because of the available supply of labor and the demand for labor. It’s not set by how much workers need to live on, unless you think people at the poverty line just stop trying to get higher wages the instant they cross the poverty line. How many people in minimum wages jobs do you think are sitting there thinking “oh well i guess I won’t try to get a better job because I don’t really need the extra money, because I have these food stamps.”

35 Sigivald April 10, 2015 at 5:44 pm

Well, to be fair, if they lose all the food stamps if they make an extra dollar a year, they are very much thinking “it would be stupid, utterly stupid, for me to make a little more money”.

But that’s why sane benefits programs (and I think SNAP is like that in this context?) graduate reduction of benefits, to precisely remove that disincentive.

36 asdf April 10, 2015 at 6:08 pm

If WMT wasn’t actively trying to bring them into the country there might very well be less of them.

37 Hopaulius April 10, 2015 at 10:49 pm

@asdf: “If WMT wasn’t actively trying to bring them into the country there might very well be less of them.”

As though only WMT is advocating unlimited immigration of bottom-rung labor. Try Barack Obama, the mainstream of Republicans and Democrats in Congress, and the Chamber of Commerce. It’s the weirdest alliance I know of.

38 Floccina April 11, 2015 at 9:29 pm

Of course people can live on what Wallmart pays.You may not want them to have to but they can. and btw what happens to the cost of housing if poor people have less money. Rents fall. Smaller cheaper apartments are built? More cheaper smaller mobile homes?

39 Mike Hunter April 13, 2015 at 1:41 pm

Apparently what progressives want is a minimum wage sufficiently high to live on and then straight cash transfers to all of the poor people that don’t have a job because of that minimum wage. Sounds like a veritable Utopia to me.

No progressives want a sufficiently high minimum wage. But since that isn’t politically feasible they resort to things like the Earned Income Tax Credit since republicans will support it by claiming that it’s a “Tax Cut”.

40 Sigivald April 10, 2015 at 5:43 pm

TJ’s and WalMart are radically different stores with radically different markets and models.

(Does TJs sell clothes and tires and have a pharmacy and a full range of personal care and household goods?

Not last time I was in one.)

At some point this becomes the fallacy of wondering why Best Buy [or ideally a profitable but not AS profitable notional competitor] can’t make as much money as an Apple Store – after all, they both sell iPhones and MacBooks!

41 KPres April 11, 2015 at 2:53 am

LOL! Trader Joe’s? Yeah, definately serving the same market as Wal-Mart!

Hey look everybody, Nordstrom pays their employees more than Wal-Mart! Grrrr!

42 chuck martel April 11, 2015 at 8:19 am

” Nordstrom pays their employees more than Wal-Mart!”

Do they?

43 Jeff R. April 10, 2015 at 3:18 pm

A lot of that benefit has gone to consumers, of course, through lower prices. Otherwise, people wouldn’t shop there.

Also, I would just note that there is or at least used to be a common narrative of Wal-Mart putting small, local or regional retailers out of business. If that is correct, and to some extent it probably is, the “transfer” is largely from those local small business owners to Wal-Mart shareholders and managers. Some of those small timers were pretty wealthy, I’m sure, and some of Wal-Mart’s shareholders are just average people, too, so it’s not clear to me that this represents a straightforward case of a “transfer from workers to owners.”

44 John Smith April 10, 2015 at 4:46 pm

Agreed. Though, the proprietors of a lot of the mom-and-pop stores are really more owners/managers/workers than anything resembling c-suite executives or robber barrons. In essence, Walmart may have replaced a class of people making $40-100k/yr with a large class of people making $20k/yr and a small class of people making $1mm+/yr.

45 Floccina April 12, 2015 at 4:53 pm

I do not think that is right those proprietors used to pay minimum wage and they treated their customers worse. They mostly managed low wage workers. I worked for some.

46 Dain April 10, 2015 at 4:48 pm

Right. Can I find a nice hefty box of oatmeal raisin cookies for a buck at Trader Joe’s? I know I can at Walgreens.

47 HL April 12, 2015 at 12:04 am

wally world destroying small businesses consolidated power, which led to lower prices for consumers but also less choice and less quality. it also encouraged people to de-engage from their community and helped usher in the age of every “new” part of a city, the part by the interstate, having the same stores and same lay out as every other. in other words it destroyed diversity, which is of course our strength

48 AIG April 10, 2015 at 6:37 pm

Do you have any evidence of this “relatively high paying jobs” that Walmart supposedly replaced?

I don’t think the clerk at the “mom and pop” store was payed $60,000 a year. But who knows, I could be wrong!

Also, if you think that those other jobs are supposedly “relatively high paying”, then you’re free not to frequent Walmart and go buy there.

What you seem opposed to, is the fact that most other people, don’t share your views, and would still rather shop at Walmart instead.

49 DCBillS April 10, 2015 at 8:08 pm

Nonsense. A favorite Walmart tactic is to open in a small market (ca10,000 population). This destroys the local small business base and eliminates a lot of relatively well paid small business owners and their long service knowledgeable employees who make a living wage. Main street dies along with the town’s identity. (A fine example though not small is Rocky Mount NC.) Other examples include thousands! of towns in the 5 – 50 thousand population range across the US. Almost all have been destroyed in the sense that their sense of place has been eliminated. The human toll is huge.

After about 10 years Walmart closes the store and moves up the road to the next easy pickings. The first town is now incapable of recovery but Walmart could care less. I call this criminal activity but our govt. encourages such rather than prosecuting it. For more see Clusterfuck Nation.

50 AIG April 10, 2015 at 9:15 pm

You responded to my question by re-iterating the same statement. Lets try this again:

1) Where is the evidence that the jobs it “replaced” were “relatively well paying”????

2) Walmart opens in….UNDER-SERVED markets. Or, at least, that was the early strategy of Walmart. Now it’s everywhere. But the point is, it opens in places where “mom and pop” stores…don’t provide anything similar to what “big box stores” provide.

3) To understand the positive economic impact of a Walmart, especially in a small under-served community…go visit a Walmart parking lot in those places. WHY do you think it’s full of cars?

4) WHY do you think people in those communities drive 2 hours each way to go to their local Walmart?

I’d have to say the greatest testament to American capitalism…was the time I drove across the country. You go to a small town in the absolute middle of nowhere Montana, where you wouldn’t expect to find anything…and there’s a Walmart. You go inside, and you can find all the same good and products you can find in any big town.

Ask those people there is “mom and pop” offered the same goods to them in their town in the middle of nowhere Montana, and if they’re glad there’s a Walmart there now. BTW, the Walmart seems surrounded not only by massive amounts of cars in the parking lot, by also by dozens of other businesses.

I.e., you don’t seem to be accounting for the…positive spillover effects of agglomeration.

51 Hopaulius April 10, 2015 at 11:01 pm

This is simply an ideological narrative. I live in one of those small towns. When I moved here in 2001 the Wal Mart was sitting all by itself in a field next to the airport. When they expanded their grocery operation, everyone expected all the other grocers to fold. One locally-owned chain with a few stores, high prices, and terrible service, closed some of them and sold the rest to another locally-owned store. We still have just as many mini-marts and convenience stores as we did before. There is still plenty of competition. The other thing that happened is that the Wal Mart attracted other retailers and restaurants, so that the formerly empty field is filling up with businesses, including a new branch of a locally-owned bank. The downtowns of our twin communities are not ghost towns. They are filled with locally-owned small businesses. The main victim of the new Wal Mart-anchored shopping center is a small mall anchored by Sears. It has been taken over by state agency offices and a large cinema multiplex. I’m just not seeing the wreckage allegedly wreaked on the town by Wal Mart.

52 HL April 12, 2015 at 12:15 am

while more efficient for the consumer right then right there at the moment of purchase, somewhere down the line the profits stop being spent in the community and more to the share holders/walton family/whatever

53 Jan April 10, 2015 at 8:44 pm

I’m sure the typical worker’s salary they replaced was > $15,000, which is what WalMart pays, on average–just a little more with the recent announcement. Compare it to the national average for a cashier, which is well above the WaMart pay. Pretty straightforward.

54 AIG April 10, 2015 at 9:19 pm

1) The average for cashiers in the US is $11.22/hour

2) The average wage at Walmart, not including managers, is $11.81…or $12.96 including full-time employees only.

3) You’re…sure…the typical worker’s salary they replaced was higher? A cashier at a small middle of nowhere town in Montana, working at a 3-man “mom and pop” business which offers 6 types of goods…was making $12/hour??? In those towns, I’d be amazed if the median salary was $12/hour, never-mind the salary of a cashier.

55 Jan April 10, 2015 at 9:47 pm

Average wage at Walmart for a cashier is $8.48/hour, per a paper published last year. Again, well below national average.
http://blogs.wsj.com/corporate-intelligence/2014/07/23/pay-at-wal-mart-low-at-the-checkout-but-high-in-the-managers-office/

Employee-reported salaries on Glassdoor confirm this is about right: http://www.glassdoor.com/Hourly-Pay/Walmart-Wal-Mart-Cashier-Hourly-Pay-E715_D_KO8,24.htm

Am I confident that Walmart replaced higher wage jobs? Yes.

56 Jan April 10, 2015 at 9:51 pm

And here is a paper that looked at Walmart’s impact on local labor markets. It reduced the total number of jobs, as well as level of compensation. I don’t know why this should be surprising.

http://www.socsci.uci.edu/~dneumark/walmart.pdf

57 KPres April 11, 2015 at 2:48 am

What makes you think the cashiers at Wal-Mart are of equal caliber as the national average? Have you ever actually shopped at a Wal-Mart?

58 AIG April 11, 2015 at 4:01 am

“Average wage at Walmart for a cashier is $8.48/hour, per a paper published last year. Again, well below national average.
http://blogs.wsj.com/corporate-intelligence/2014/07/23/pay-at-wal-mart-low-at-the-checkout-but-high-in-the-managers-office/

Too bad that the paper in question directly contradicts the arguments put forth here:

“We conclude that the growth in modern retail, characterized by larger chains of larger establishments with more levels of hierarchy, is raising wage rates relative to traditional mom-and-pop retail stores.”

😉

59 TallDave April 11, 2015 at 12:09 am

The transfer is overwhelmingly to consumers rather than owners. It’s not really even a controversial concept, Nordhaus and others have done papers on it.

This is why market economies have created such historically astounding living standards: consumers uber alles. He who spends, decides. Since people do not voluntarily make value exchanges that leave them worse off, to accumulate a lot of value you have offer a huge number of people a winning value proposition: that is, you have to improve their lives.

Low income people would be worse off without WalMart, just as they would be worse off if Ned Ludd broke up all the digging machines and we hired diggers with shovels instead.

60 triclops April 11, 2015 at 1:30 pm

A fantasy objection, at that. Walmart pays more than the small stores it replaces.

But the anger feels so real, there must be something to it!

61 TimH April 10, 2015 at 2:43 pm

Another argument that I’m surprised that Libertarians are afraid (I think?) to bring up: When someone (a laid off employee, a union, etc.) complains that [group of people – immigrants, “illegal immigrants,” workers in another country] are “taking our jobs.”

It isn’t your job. It’s your job in some sense if you have it, but you probably don’t.

The job belongs to the company, firm or individual offering the position, benefits and terms of labor. Why shouldn’t they be able to offer it to whomever they chose, and wherever they want to employ the person?

62 Devin April 10, 2015 at 3:12 pm

Ideologies are matters of perceived convenience.

63 Sigivald April 10, 2015 at 5:48 pm

I’m not afraid to bring it up, myself.

I just rarely end up even bothering to talk to someone who think there’s some fundamental right for a product to be produced by them, here, rather than by someone else, somewhere else.

Ricardo and all that.

I have said, more or less, “if you want there to be US manufacturing jobs, start making things with superior value, either in quality or cost or both”.

And “I’ll ‘buy American’ whenever American products provide superior value, not otherwise”.

64 Jason K. April 10, 2015 at 2:43 pm

That is a false moral choice. People that do not have employees aren’t generally asking others to sacrifice a significant number of hours for our benefit for no compensation. The author is only looking at the renumeration, not the whole trade. I would posit that there are cases where it is more ethical (circumstances variant in your ethical system of choice) not to trade than to offer a poor trade. While I do agree that Wal-mart’s low rate is enabled in part by the social safety net and that Wal-Mart is within their rights to only offer that much, that critique of Wal-mart critics is invalid.

65 dan1111 April 10, 2015 at 3:43 pm

“I would posit that there are cases where it is more ethical (circumstances variant in your ethical system of choice) not to trade than to offer a poor trade.”

The voluntary offer of any kind of trade to someone only increases the options available to them. No trade can only be more ethical than a bad trade if you don’t consider the individual to be capable of making their own decisions.

66 msgkings April 10, 2015 at 4:58 pm

If the two parties have very assymetric information that can also be an unethical trade. It’s not the decisionmaking of the individual in question, it’s the lack of enough information to make a good decision.

67 Pshrnk April 10, 2015 at 5:13 pm

If I studie hard to get the information and you stayed on the couch drinking Bud and watching Jerry Springer then your lack of information is your fault.

68 stalin April 12, 2015 at 3:00 am

Apparently you didn’t “studie” spelling enough.

69 dan1111 April 10, 2015 at 5:21 pm

Ok, but that doesn’t seem to apply in this case. The allegation is not that Walmart is misleading employees. New employees are presumably told what the wages, benefits, and expectations are when they are hired. Even if it turns out to be not what they expect, they are free to quit at any time.

70 msgkings April 10, 2015 at 6:14 pm

Agreed, just noting that not every trade offered is always ethical. So in some cases no trade is more ethical.

71 meets April 11, 2015 at 8:54 am

Yes, I’m sure the people not hiring anyone could hire thousands if they really wanted to.

72 CG April 10, 2015 at 2:58 pm

I don’t see the conflict between those moral standards. Under the first standard, an exchange is taking place. Critics of Walmart are demanding that this exchange be “fair”. Under the second standard, there is no exchange. If you’re not employing anybody, you’re not receiving anything of value so have no obligation to pay.

73 Slocum April 10, 2015 at 3:43 pm

You’re missing the point. Walmart is offering it’s employees an opportunity to earn a paycheck which will make them better off than they would be otherwise (if it didn’t they wouldn’t accept the job). You’re offering those same people nothing except ‘benign’ neglect. Engaging in mutually beneficial exchanges with people — in this case, providing them employment — is pro-social. Ignoring them (and feeling good about it) isn’t.

74 Devin April 10, 2015 at 3:53 pm

The point you’re missing is that welfare and medicaid are not forms of “benign’ neglect.” No taxpayer is living by the second standard.

75 Pshrnk April 10, 2015 at 5:14 pm

Have you tried to get an appointment with IL medicaid?

76 TallDave April 11, 2015 at 12:12 am

Yes, but in addition to not employing anyone, you’re also not paying those billions in taxes what Walmart pays.

77 Jan April 10, 2015 at 8:52 pm

You are speaking as if Walmart is doing someone a favor out of the goodness of their hearts when it has a job opening. It’s not. It is figuring out how to make the company more money and the employment of humans is just incidental to that quest for dollars. That’s it.

78 TallDave April 11, 2015 at 12:15 am

It sounds like you are accusing WalMart of running a business.

79 KPres April 11, 2015 at 2:36 am

Much like how the products and that labor produces is incidental to THEIR pursuit of dollars. Jan is just now figuring out how the world functions.

80 jizay April 11, 2015 at 10:09 pm

Wow, Jan, it’s almost as if I get my dinner not out of the goodness of the butcher and the baker’s hearts but rather their quest for dollars. Deep.

81 Mike Hunter April 13, 2015 at 1:50 pm

Who’s “ignoring them”? Certainly not the people advocating that they be paid higher wages, especially if that person is also a taxpayer who helps provide impoverished walmart workers with: food stamps and Medicaid.

Why don’t you actually ask the floor workers at your local walmart who’s neglectful: The people who openly advocate for better employee wages and working conditions; or people who think the workers should be happy just to have a job?

82 dan1111 April 10, 2015 at 4:18 pm

This changes if you see jobs as voluntary contracts between an employer and employee.

Walmart offers people the opportunity to work at a certain rate of pay. They can choose to accept that offer or not. On the other hand, I offer no one a job.

How can my position be moral, and Walmart’s not? People can get the same outcome from Walmart that I am offering (no job) if they want. They also are offered an additional option by Walmart. If they choose to accept Walmart’s offer of employment, it is by definition a fair exchange, since they agreed to it.

Look at it another way: if it is ethical to not employ anyone, but unethical to offer low wages, then Walmart could improve its ethical position by not employing anyone. But would this really be better for employees?

This is the point that is being made here. I understand that not everyone will accept it, because this is a point at which left and right have fundamentally different views of the world. But it is not a silly argument or straw man. It is a logical argument given a certain set of priors. Some people just reject those priors.

83 John Smith April 10, 2015 at 5:14 pm

Embedded in the critique of Walmart is that they’re a quasi-monopolist player. They use their scale and resources to crush small businesses, making their labor force largely captive to their employment practices.

You can agree with that narrative or not, but it’s hard to argue that Walmart has simply created 1.2mm jobs out of thin air.

84 chuck martel April 10, 2015 at 6:29 pm

“Quasi-monopolist”?

No doubt in 1884 the fellas sitting around the pot-belly stove at Zeke’s General Store in Pumpkin Junction lamented the annual arrival of the Montgomery Ward catalog and the strong possibility that the behemoth retailer would run ol’ Zeke out of business. Maybe I’ll run down to Monkey Wards right now and pick up some horse collars and darning needles.

85 Jan April 10, 2015 at 9:18 pm

This. And the company is now so large that in many communities it wields an amount of power that none of it’s competitors can come close to matching. This often manifests itself is disproportionate political power and the ability to ensure lawmakers create tax and labor policy that is favorable to its business practices.

86 Hopaulius April 10, 2015 at 11:16 pm

I suspect part of chuck’s point is that “Monkey Wards,” once a threatening retail behemoth, no longer exists.

87 KPres April 11, 2015 at 2:33 am

Yeah, because small-time county officials have so much influence on tax and labor policy that businesses are subject to. LOL!

88 Pshrnk April 10, 2015 at 5:18 pm

If I chose to decline Walmart’s offer deeming the wage too low I have no job. Walmart has not harmed me financially any more than you have by not offering me a job at all. There is no way Walmart has harmed me unless you have also by offering no job.

89 John Smith April 10, 2015 at 5:31 pm

@Pshrnk

Again, this assumes Walmart exists in a vacuum and that is hasn’t gutted the local small-business economy, reducing the pay for low to moderate skill labor. In that way, Walmart has hurt you financially and isn’t a benevolent economic player (either incidentally or by design).

90 FC April 10, 2015 at 9:45 pm

If you think there is any moderately skilled labor happening at a Wal-Mart, you don’t understand their HR strategy. (A tire shop or pharmacy, if present, are exceptions.) Even the store managers are mostly drones remotely monitored from the head office.

91 Hopaulius April 10, 2015 at 11:21 pm

@John Smith: and you assume that the United States and its supposedly egalitarian pre-WalMart society existed in a vacuum, where cheap goods created by cheap foreign labor could be permanently sealed across the ocean. I just don’t see how importing a $1.00 trinket and reselling in Ma n Pa’s retail store for $20.00 and paying their clerk $1.40/hr. (my first wage) was more moral than Walmart selling it for $5.

92 Gene Callahan April 10, 2015 at 3:02 pm

What CG said: The post linked to was not “essentially true,” it was “an absurd strawman.”

93 prior_approval April 10, 2015 at 3:12 pm

Hey now, at least you can never blame this place for wanting to be like the tin man.

94 Dain April 10, 2015 at 3:02 pm

Sounds akin to the insult of leaving a fifty cent tip. It’s better than nothing, I guess, but it feels worse than nothing. If you’re gonna tip, do it right.

95 3rdMoment April 10, 2015 at 3:48 pm

This is about the only comment that actually manages a coherent criticism of Decker’s argument.

But do you really think that a tipped employee prefers a zero tip to a 50-cent tip? I worked for tips before, and I certainly didn’t feel that way. Do you really think Walmart employees feel so disrespected they would on some level be happier with no jobs?

96 Dain April 10, 2015 at 3:52 pm

Thanks, I consider it a simplistic argument which is nonetheless essentially true.

No, I don’t think a tipped employee prefers a zero tip to fifty cents, but most probably think the alternative isn’t zero but rather a small handful of dollar bills.

97 meets April 11, 2015 at 9:02 am

Feels bad to who? The Wal-Mart critics who tip zero are the only ones who seem to feel bad.

98 Kevin Erdmann April 10, 2015 at 4:20 pm

No. It’s like giving a 20% tip at a greasy spoon and then seeing protesters outside who complain that the tip wasn’t as high as the tip you left the previous night at a fancy steakhouse.

99 Pshrnk April 10, 2015 at 5:19 pm

50 cents is doing it right for bad service. Gotta let them know you didn’t just forget.

100 libert April 10, 2015 at 3:16 pm

Look, I’m a fan of WalMart. I think it has done great things for the poor by providing goods cheaply to the public. They are not obliged to pay more than they can negotiate with their workers (subject to certain basic laws, etc.).

But this argument is absurd on its face. It only looks at one half of the ledger–the amount of money transferred from person A to person B, while ignoring the value of the labor transferred from person B to person A.

The author suggests “WalMart pays employees. You do not. Therefore, WalMart is more moral than you.” Of course, the same logic could be used in reverse: “WalMart takes labor hours from employees. You do not. Therefore, you are more moral than WalMart.” The exchange of goods and services implies nothing about morality!!!

Further, WalMart does not “provide jobs” to people who would not otherwise have jobs. Workers create jobs (that’s why they represent “labor supply”). Saying they do is like saying that gasoline consumers “create oil”. If WalMart didn’t exist, they would work in a different job. This is basic economics. So please don’t act like WalMart is a benevolent provider for the poor. It is not. But that’s OK. It’s a business.

By the way, if I shop at WalMart, does that mean that I can claim moral superiority because I help pay for its employees salaries?

101 3rdMoment April 10, 2015 at 3:51 pm

You are misunderstanding the argument. How about this:

“Walmart expands the choice set to low-skill workers. The long line of people who queue up to apply when a new Walmart opens shows that many value having this choice. You, on the other hand, did nothing to expand their choice set.”

102 Millian April 10, 2015 at 7:31 pm

You expand worker choices by using businesses. You expand different choices when you patronise different businesses. Firms exist because they have customers. They are not some kind of sci-fi heroic endeavour indifferent to the opinions of those they serve. Consciously altering one’s consumption to reward and encourage moral behaviours can be a moral act.

103 Pshrnk April 10, 2015 at 5:22 pm

Walmart DOES NOT TAKE labor hours from employees! Employees agree to provide labor hours! Workers do not create jobs…spenders create jobs.

104 Sigivald April 10, 2015 at 6:02 pm

Further, WalMart does not “provide jobs” to people who would not otherwise have jobs. Workers create jobs.

… what?

Workers provide labor; thus as you say, “labor supply”.

If they create jobs they’re now self-employed/entrepreneurs/capitalists [in the strict economic sense; investing in capital to increase labor returns].

WalMart can much more fairly be said to create jobs (what normal people call opportunities for paid employment by a person who performs work) than the workers can.

Jobs and labor are intimately related, but they are not identical things.

105 libert April 10, 2015 at 10:07 pm

@Sigivald: You’re missing my point re: jobs. Efficient markets lead to full employment regardless of the industrial organization of individual markets. Otherwise it is not an equilibrium. Hence, the total number of jobs (per capita) is fixed with respect to the makeup of individual industries like retail. So no individual firm can “create jobs”. If one sector hires more labor, it must hire it away from other sectors. Hence, any job creation by one firm must be offset by an equal amount of job destruction from other firms. This is why economists forcefully argue that cost benefit analyses should count “jobs created” as a cost, rather than a benefit.

106 Thomas April 12, 2015 at 4:44 pm

Sure, that’s true in an efficient market – just not true in our market.

107 Jan April 10, 2015 at 9:25 pm

And Walmart does not GIVE jobs! They agree to pay employees because it requires them to make more money. Spenders do not create jobs…the human needs/desires for services and products create demand to supply these things.

108 libert April 10, 2015 at 9:58 pm

Exactly, Jan.

109 TallDave April 11, 2015 at 12:17 am

Yes, but Walmart employed 1.2 million people more than you did.

And even though your heart has so much more goodness!

110 KPres April 11, 2015 at 2:16 am

Well, I want a yacht. Guess I just created a bunch of shipyard jobs! Amazing!

111 libert April 10, 2015 at 9:57 pm

If that’s the case, then isn’t it also true that WalMart does not provide wages to employees? WalMart agrees to pay wages, just as employees agree to provide labor. Note: I do not mean “take” in a confiscatory sense, just as I do not mean “pay” in a charitable sense.

112 TallDave April 11, 2015 at 12:23 am

Paying is not employing. The value to employees is the agreement to exchange labor for dollars.

By all means, if you can profitably employ millions of man-hours of low-skill labor, please do so!

Finally, if workers create their own jobs, explain the existence of unemployment.

113 libert April 10, 2015 at 3:19 pm

Northern abolitionists in the 1800s did not pay wages to southern slaves. Therefore, they as immoral as southern slaveholders. After all, they both paid slaves no wages.

(No, I’m not saying that WalMart is morally equivalent to slavers. I’m just pointing out the obvious fallacy in the author’s argument)

114 dan1111 April 10, 2015 at 4:21 pm

The entire argument is premised on employment being a voluntary contract. The point is that offering a voluntary contract cannot be less ethical than making no offer, since the offer of a contract only increases someone’s options. An example involving coercion is not relevant.

115 libert April 10, 2015 at 10:21 pm

Thought experiment: are unions exploiting their monopoly power to extract wage increases acting more or less “morally” than some uninvolved bystander like you or me?

If you say neither, I agree, and think the same applies to the WalMart case, which is the point I was trying to make previously.

If you say less morally, then that contradicts Mr. Decker’s argument–the union is offering a voluntary contract, whereas the bystander is offering nothing.

If you say more morally, then I disagree, mostly because I don’t think this is a moral issue. But if I had to choose, I would not choose more morally, as I’m sure most here would agree.

116 dan1111 April 11, 2015 at 5:39 am

As long as every employee is free to choose whether to join the union, and every company is free to choose whether to negotiate with unions, then it is a voluntary contract and I have no objection. The union action is no more or less moral than my inaction. That isn’t really the case, though, is it?

I don’t see how this is equivalent to your previous comment, though.

117 stalin April 12, 2015 at 3:15 am

Northern abolitionists in the 1800s paid SLAVE wages to northern workers. Northern abolitionists mostly wanted high tariffs which they got during the Civil War and maintained until 1913. We call them Robber Barons today.

118 tt April 10, 2015 at 3:21 pm

nonsense, the mom and pop shops have employees and are walmart critics.

119 Slocum April 10, 2015 at 3:45 pm

…and typically pay lower wages than Walmart while charging higher prices to their customers (not because they’re evil, but because they’re less efficient).

120 Jan April 10, 2015 at 9:27 pm

Bullshit. Walmart pays well below average wages for retail. Look up average cashier wages in this country. Walmart is more than a couple bucks per hour below the national rate.

121 txslr April 10, 2015 at 10:02 pm

You do understand that someone has to pay below the average, right? This isn’t Lake Woebegone.

122 Jan April 10, 2015 at 10:14 pm

Yes…I understand how averages work. He said Walmart pays more than mom and pops. It doesn’t.

123 KPres April 11, 2015 at 2:29 am

Yeah, only because the average includes those in high-end retailers as well. What about just the discount department stores that tend to locate in low-income areas?

124 Dick King April 10, 2015 at 3:56 pm

Mom and pop stores don’t pay as well as major retailers.

http://www.nber.org/papers/w20313

The paper is gated, but there’s a summary available: http://www.nber.org/digest/dec14/w20313.html

-dk

125 tt April 10, 2015 at 4:46 pm

the paper includes managerial positions.
do they include CEO’s salarys in their average ?
do you have a source that compares non-managerial positions?

126 Sigivald April 10, 2015 at 6:05 pm

Major retailers have lots of outlets and employees and exactly one CEO, so that’s not going to matter all that much; it’ll be noise in overall compensation.

Local managers aren’t making insanely high wages, just like local, marginal store owners don’t pay themselves less than their checkers (well, until right before bankruptcy, maybe).

Besides, note the graph in the summary – there is a wages comparison for non-managerial positions; it’s the blue bars.

127 AIG April 10, 2015 at 6:46 pm

It says right in the abstract…worker fixed effects.

128 Jan April 10, 2015 at 9:28 pm

This has been studied already. Walmart pays more for management and less for common retail workers, compared to averages.

129 Jan April 10, 2015 at 9:29 pm

Guess which category of employee they have way more of

130 Hopaulius April 10, 2015 at 11:58 pm

Are you being treated for Walmart derangement syndrome? Did you have the same feelings about Sears?

131 Peter April 10, 2015 at 3:32 pm

When you have gutted the demand side of the economy what emerges are phenomena like Walmart where lower consumer prices are achieved through a monopsony (the private sector form of the “single payer” holy grail socialized medicine seeks for the same reason) that not only pays its suppliers less, but also its employees less because as the jobs market contracts, there is nowhere else to work ultimately.

Walmart also knows EXACTLY what it is doing when it trains its employees in the art of extracting government benefits from a decreasing government revenue stream.

132 meets April 11, 2015 at 9:06 am

So, now poor people who apply for benefits are doing something wrong (“extracting”) if they happen to work for Wal-Mart?

133 Millian April 10, 2015 at 3:34 pm

Sorry, it is much too simplistic to be true. It could only possibly be true if the alternative to Walmart is buying no groceries. The alternative is instead to buy groceries from better-paid workers. No?

134 meets April 11, 2015 at 9:07 am

And how does this alternative come about?

135 Nick L April 10, 2015 at 3:48 pm

By this logic no one should ever criticize anyone for anything, ever, unless they are engaged in that activity themselves. For example, I can’t complain about the government because I myself don’t govern over anyone.

136 3rdMoment April 10, 2015 at 3:54 pm

Nonsense. If Walmart was enslaving people, or defrauding them, you can certainly complain.

But it seems strange to complain about someone offering someone something (in this case a job), when you have offered them nothing.

137 Nick L April 10, 2015 at 4:39 pm

Maybe I’m misreading, but Decker just appears to be regurgitating the old argument of ‘if you want workers to be paid more, go start a company and pay them more.’ If that’s the case, you can say that about anything. ‘If you don’t like Walmart enslaving workers, go start a company and don’t enslave them.’

138 JWatts April 10, 2015 at 5:46 pm

No, that’s not what he’s saying. He’s saying Walmart offers a choice. The critics don’t. Any voluntary choice is better than not.

139 Nick L April 10, 2015 at 6:11 pm

Right, but critics of anything almost never offer a choice. They’re just critics. That’s why this entire line of thinking seems off.

140 Thomas April 12, 2015 at 4:50 pm

Nick L has already demonstrated that he is incapable of distinguishing between voluntary and coerced decisions. It’s a common attribute among the left.

141 Pshrnk April 10, 2015 at 5:25 pm

Hey just because i SIN DOESN’T MEAN i CAN’T SAY YOU ARE A SINNER. “tAKES ONE TO KNOW ONE :-}

142 Joey_33 April 10, 2015 at 4:48 pm

Yeah, the post’s argument is asinine, and that the author found it profound says something negative about this blog.

143 yenwoda April 10, 2015 at 3:53 pm

ObamaCare critics embrace two policy standards: in the first, good policy requires that expanding access to healthcare insurance must follow a free market framework. In the second, good policy can be achieved without expanding health insurance access at all–that is, by maintaining a status quo in which many millions fewer Americans have health insurance. Some of us have chosen to live by the second standard, and from our lofty moral position we can criticize Congress for not meeting the first standard. How convenient!

144 dan1111 April 10, 2015 at 4:23 pm

This fails to be like the argument that is being made on so many levels.

145 collin April 10, 2015 at 3:59 pm

What does morality have to do with Wal-Mart paying low wage? I look at them evil nor good for the wages they pay. Otherwise, it is still a crappy place to shop and getting worse. On the West Coast, Winco is run 100% better and a lot cheaper prices.

146 Clover April 10, 2015 at 4:26 pm

Most of us don’t have billions of dollars in profits we could give to the workers.

147 Cooper April 10, 2015 at 4:35 pm

The net operating margin of Walmart is 3.5%

A typical mom and pop convenient store has a much larger net operating margin.

Profits in the retail sector are smaller as a result of Walmart coming to town, not larger.

148 Jan April 10, 2015 at 9:32 pm

They have plenty of resources to pay employees more–up to $14+/hour. They have no incentive to do so.

http://www.usnews.com/opinion/blogs/pat-garofalo/2013/11/21/why-walmart-can-afford-to-pay-its-workers-much-more

149 Larry Siegel April 10, 2015 at 11:25 pm

Jan, why don’t you send me $10? Use Paypal, since the only information you have about me is my E-mail address. I’m sure it won’t affect your bottom line significantly and it would mean a lot to me. Thanks.

150 idrather notsay April 10, 2015 at 4:35 pm

Critics of thugs who work for totalitarian dictators embrace two moral standards: in the first, morality requires that, when working for a totalitarian dictator, you not kill anyone. In the second, morality can be achieved by not working for totalitarian dictators. Most of us have chosen to live by the second standard, and from our lofty moral position we can criticize various thugs working for totalitarian dictators for not meeting the first standard. How convenient!

(Note: This is not an argument by analogy; it is not a comparison of Walmart to a totalitarian dictator. It is not any form of argument for any criticism of Walmart at all. Rather, I assume that the quote was an attempt at an argument against what it takes to be an objectionable form of hypocrisy. This is an argument by counter-example, meant to show that the argument would fail: it gives us no reason to think that the view it targets is objectionably hypocritical.)

151 dan1111 April 10, 2015 at 4:49 pm

Like everyone else trying to do this, you have failed to understand the argument and thus failed to defeat it.

152 Millian April 10, 2015 at 7:22 pm

The refutation to the linked argument is – trivially – banal: shop at a place that pays better than Walmart, create no jobs but encourage those who do to create better-paid jobs.

153 MikeP April 10, 2015 at 8:57 pm

You have that option and I assume you and your liberal friends are taking advantage of it. With enough like minded people, you can then start a WMT alternative that pays its employees a fair wage. Be sure to employ as many workers as you can fit in the building and spread that fair wage as far as you can.

154 Hopaulius April 11, 2015 at 12:10 am

There are certain categories of things I won’t buy at Walmart. One of them is electronic devices. When I have attempted to make such purchases there, the clerks were unable to answer the most basic of questions. However, when I want to buy 2.5 gallons of diesel exhaust fluid, I don’t need any expert advice, and the cost at Walmart is $8.50. My regionally-owned car dealership charged me $21. This does not motivate me to shop at the dealership.

155 dan1111 April 11, 2015 at 5:41 am

@Millian, yes that alternative exists, but that is a voluntary, market-based way of encouraging higher salaries. The argument is aimed at people who believe Walmart should be coerced to pay more.

156 Pshrnk April 10, 2015 at 5:28 pm

Besides: a hypocrite”s crticism of you may still be true.

157 JWatts April 10, 2015 at 5:49 pm

This! A smoker who tells a teenager that smoking is bad for them and they shouldn’t do it, still has a valid argument.

158 Kenneth April 10, 2015 at 4:55 pm

I’m really struggling with the logic here: if non-employers cannot comment on wages then non-parents cannot comment on parental child abuse or non-murderers cannot comment on the death penalty. Surely economics (especially economics blogging) replies upon people considering a situation from outside?

159 JWatts April 10, 2015 at 5:51 pm

No, you are completely missing the point. The argument is that Walmart offers a choice. Child abusers and murders are not offering choices.

160 Millian April 10, 2015 at 7:22 pm

Heroin dealers offer a choice. But as a person who’s never sold heroin, what right do I have to carp about them?

161 Jan April 10, 2015 at 9:38 pm

What is the choice that Walmart offers the former employees of Walmart’s competitors that they have driven out of business because they lack the economies of scale to compete with the chain?

162 Thomas April 12, 2015 at 4:54 pm

How does Walmart 1. come to down – 2. operate – 3. destroy local business – 4. and only then get employees?

163 Hopaulius April 11, 2015 at 12:12 am

It’s not that “non-employers cannot comment,” it’s that their claims of moral superiority are invalid or irrelevant, since they themselves are not employers.

164 Marc April 10, 2015 at 5:20 pm

Walmart employees compensate their gigantic lobbying arm (the “outraged public”) with lower prices at the cash register.

When the prices at the cash register rise, the lobbyists will no longer be compensated.

165 Jan April 10, 2015 at 9:41 pm

Walmart compensates its much more significant lobbying arm with cold, hard cash.

https://www.opensecrets.org/lobby/clientlbs.php?id=D000000367&year=2014

166 Thomas April 12, 2015 at 4:55 pm

Unions compensate there much more significant lobbying arm (the Democrat party) more than any other entity.

(your own source)

167 Sherwood April 10, 2015 at 5:40 pm

Disagree with Decker’s argument. I don’t need to be a gun owner to have an valid opinion on gun ownership.

But having said that, I think he’s touching on something real when he mentions talk of “morality.” I think some of the mud that “moral” people sling against Walmart is actually a veiled dismissal of the people, products, and class that Walmart is associated with. And of the need that Walmart fulfills. Walmart doesn’t need to exist, low-paying jobs don’t need to exist, and “low low prices” don’t need to exist.

“Let them eat kale”, essentially.

168 JWatts April 10, 2015 at 5:55 pm

Honestly Decker’s argument is pretty close to what you state. Walmart is offering their workers bread and the Critics are saying, “You should give them Cake”. The Critics are ignoring the economic reality that if the only choice of food is expensive Cake, there will be fewer fed workers.

169 Millian April 10, 2015 at 7:24 pm

Low wage supporters too often feel the need to booster Walmart. “Did you know that Walmart has such good prices solely because its workers are badly paid?”

170 prior_approval April 11, 2015 at 7:00 am

Well, that and exploiting their suppliers too. Semi-slave labor in China only being a part of the whole picture.

171 RJB April 10, 2015 at 6:07 pm

It is hard to criticize the morality of an economic actor extracting as much as possible of the surplus they create within societal norms. But I don’t see any problem with arguing that they are immorally violating existing norms (even if they are within the law), or arguing that their efforts to shift norms and laws are immoral, or arguing that society’s existing norms and laws are currently immoral, and the actor is benefiting from them.

172 asdf April 10, 2015 at 6:10 pm

Thank you.

173 AB April 10, 2015 at 6:46 pm

Nope. Such critics do not believe that morality requires payment of high wages to 1.2 million people.

Some of them may however believe that if you employ [1.2 million] people you are morally obliged to pay them decent wages .In other words, relationships matter. This is not utilitarian (in this narrow sense), but then narrow utilitarianism is not very humane.

Others (more socialist in outlook) probably do not see it as a moral matter at all, just a struggle for worker empowerment, but think moral rhetoric is a useful way of rallying support and putting pressure on employers.

Like the recent post claiming that worrying about equality (as opposed to mobility) is literally a ‘mistake’, this one betrays that the author really does not understand how his opponents think.

174 Millian April 10, 2015 at 7:25 pm

A failure of an ideological Turing Test, at that.

175 TallDave April 11, 2015 at 12:30 am

if you employ [1.2 million] people you are morally obliged to pay them decent wages

Sure, throw all the low-skill employees out of work. For morality!

“Relationships matter” is an easy judgment to make when you have established 1.2 million fewer relationships.

176 Cooper April 10, 2015 at 7:11 pm

Walmart hires a large number of people who would otherwise be unemployable. Labor productivity in their stores is low. Revenue per square foot of retail space is low. Overall profit margins are lower than the industry average. The CEO could be paid *nothing* and the average Walmart employee could get a raise of around $22 per year. Given that most of his compensation is in the form of stock and not cash, each Walmart employee would actually be getting a $5 per year raise and around .2 shares of stock.

Most of the economic surplus generated by Walmart has been captured by consumers in the form of lower prices. The Walmart heirs have pertained benefited handsomely and when those heirs die, the government will take about 40% of the money.

177 Millian April 10, 2015 at 7:26 pm

Of course they’re not otherwise unemployable. You’re asserting that, in a world where the one specific corporation called Walmart doesn’t exist or has different pay policies, the US unemployment rate would be several points higher. Don’t buy it.

178 txslr April 10, 2015 at 9:42 pm

True, but isn’t it reasonable to suppose that, in the absence of the jobs at Walmart – a job which each and every employee voluntarily accepted – they would be getting less than they are? Presumably those who are working at Walmart took the best job they could find, right? And if they could get more somewhere else they would take it, wouldn’t they?

So are we to suppose that, if Walmart hadn’t come into the community and hired all of those people prevailing wages for low-skill workers would be higher? Or is the claim that Walmart is substituting capital for labor and hence driving down the total demand for low-skilled workers? From what I’ve seen it seems more likely that Walmart is using its scale economies in logistics and purchasing to push down the retail prices of goods, allowing people to purchase more subject to given budget constraints and resulting in a net increase in employment in what remains a labor-intensive business.

On the other hand, I suppose Walmart could automate the living daylights out of their stores, cut their workforce by 75% and raise the salaries of those remaining (more highly skilled workers) to $15/hour. Would that be more moral?

179 prior_approval April 11, 2015 at 4:02 am

‘a job which each and every employee voluntarily accepted’

But would each and every employee voluntarily stay there if they found a job paying more? Apparently, Walmart does not think so, and is thus raising wages.

180 txslr April 11, 2015 at 2:08 pm

Yay markets!!!!

181 triclops April 11, 2015 at 2:41 pm

Right, in the alternate universe they could certainly get work at a similar company, say, Malwart, that pays about the same wages and his about the same economic niche.

182 mobile April 10, 2015 at 7:13 pm

Steve Landsburg said it better

When we collectively want a whole lot of 18-year olds to form an army, do we put the entire burden of that desire on people who happen to be 18 years old, by conscripting them at zero wage? Or do we think it’s fairer for those of us who enjoy the protections of that army to bear the cost through the tax system? When we collectively want to convert farmland to parkland, do we put the entire burden of that desire on people who happen to own farms, by taking their land without compensation? Or do we think it’s fairer for potential park-goers to pay for that land through the tax system? When we collectively want to raise the wages of unskilled workers, should we put the entire burden of that desire on those who happen to employ unskilled workers? Or is it fairer for those who have collectively made this decision to share the burden?

http://www.thebigquestions.com/2013/12/06/blast-from-the-past/

183 Max April 11, 2015 at 12:35 am

I don’t know about you, but I would be happy to absorb mild ineffectual criticism in exchange for fabulous wealth. Seems like a great deal.

184 Los Ranchos April 10, 2015 at 9:26 pm

Walmart bashing reminds me of McDonald’s bashing. Where are Mark Bittman’s articles decrying the nutritional content of Shake Shack? They don’t and won’t exist. It’s noblesse oblige. It’s also saying I’d rather have a 60k per year eccentric white guy running a book store as a neighbor than two blacks or mexicans who work at Walmart.

185 Urstoff April 10, 2015 at 10:06 pm

It’s pretty impressive the cognitive dissonance that a lot of progressives have when it comes to the poor: they are very concerned for them but also are completely contemptuous of them (especially the white rural poor). They don’t want to shop at Wal-Mart because even though it sells all the same things as Target, it’s “dirty” (that is, full of poor people; see: peopleofwalmart.com) or it’s evil (convenient!). They’re very concerned for the plight of the poor but take very real steps to insulate them from ever having to come in contact with poor people.

186 Jan April 10, 2015 at 10:10 pm

peopleofwalmart.com is a liberal’s creation, and he did it because he doesn’t like poor people?

What do liberals do that is so contemptuous of the poor? And can you say with certainty that whatever it is, conservatives don’t do the same thing?

187 Urstoff April 10, 2015 at 10:25 pm

No, most everyone is contemptuous of the poor. Liberals just also make a point to signal that they care a lot about them as well.

188 Jan April 10, 2015 at 10:45 pm

It doesn’t seem the accusation of liberal cognitive dissonance really makes sense in this case.

Yes, liberals see a direct link between many of the policies they support and helping the poor. Conservatives typically say they care about the poor as well–I don’t think many would claim otherwise. The difference is that conservative policies are generally harder to connect to concrete benefits for the poor, and it can even be argued that many are quite bad for this group of people. I realize there are fundamental disagreements about the actual impacts of various policies. In any case, the poor typically support liberals and it is likely for a better reason than just signaling.

I don’t think not shopping at Walmart and living in nicer neighborhoods when one can afford to is particularly contemptuous of the poor. And I live in a city where a lot of low-income people in very liberal (voting-wise) areas shop at Walmart. How do we classify them?

189 prior_approval April 11, 2015 at 3:59 am

‘I don’t think many would claim otherwise’

With the occasionally publicly uttered exception – like this one.

‘South Carolina Lt. Governor Andre Bauer, who hopes to succeed fellow Republican Mark Sanford as his state’s governor, drew a comparison between government help for poor people and “feeding stray animals” – who, he noted, “breed.”

“My grandmother was not a highly educated woman, but she told me as a small child to quit feeding stray animals,” Bauer said during a town hall meeting, as the Greenville News reported over the weekend. “You know why? Because they breed. You’re facilitating the problem if you give an animal or a person ample food supply. They will reproduce, especially ones that don’t think too much further than that. And so what you’ve got to do is you’ve got to curtail that type of behavior. They don’t know any better.”‘ http://www.cbsnews.com/news/sc-lt-gov-andre-bauer-compares-helping-poor-to-feeding-stray-animals/

Of course, his career didn’t go very far after that – maybe even conservatives have a hard time ignoring the compassion Jesus felt necessary all people to have towards others.

Or not, as noted in Nov. 2014 – ‘Last week, 90-year-old World War II veteran Arnold Abbott made national headlines when he got busted by cops in Fort Lauderdale, Florida twice in one week—for giving out food to homeless people. While serving a public meal on November 2, Abbott told the Sun-Sentinel, “a policeman pulled my arm and said, ‘Drop that plate right now,’ like it was a gun.” Abbott runs a nonprofit group that regularly distributes food in city parks. Because of an ordinance the city passed this October that restricts feeding the homeless in public, his charity work is now potentially illegal.

Abbott was cited again three days later in a different city park. Now the retired jewelry salesman is facing up to 60 days in jail or a $500 fine. And he’s not the only one risking jail time for generosity: 71 cities across the country have passed or tried to pass ordinances that criminalize feeding the homeless, according to Michael Stoops, director of community organizing at the National Coalition for the Homeless.’ http://www.motherjones.com/politics/2014/11/90-year-old-florida-veteran-arrested-feeding-homeless-bans

190 Jan April 10, 2015 at 10:06 pm

Are you sure that’s why? If Bittman is trying to most efficiently deploy his efforts against unhealthy food, then McDonald’s offers the best bang for his buck.

Also, Shake Shack is different from McDonald’s on in a few domains that many consider important: humanely raised beef, produced with no hormones or antibiotics, offering recycling in their stores and composting kitchen waste. I’m not saying you should care about these things, but some people do and so there may be actual reasons beyond its large volumes of high-cal food that critics start with McDonald’s.

191 Los Ranchos April 11, 2015 at 1:56 am

Jan’s comments are crucial. Yes, lower income people dont care (wont pay) for those things. It’s an amazingly obnoxious thing to hear people who make 200k per year tell people who make 20k per year what they “should” consume. And Dear Editor, if listening, next post “should” be about “should”, it’s the heart of the title of this blog and the political discourse.

Per Shake Shack argument. Take Shake Shack. Take McDonalds. Put them through any rational chemical analysis. The same. Period. Salt, fat, etc. But see a post with Bittman with a greasy chin from his favorite gastro pub boite (I only do this once a week!) denouncing Arfrican Americans for eating hamburgers. It’s hilarious. Triumph of the Jewish Dietelligentnsia. And this is not a dog whistle. It is a Jewish intellectual thing! Sailer come out and take a swing!

192 Michael Foody April 10, 2015 at 10:21 pm

Not personally into the wal mart hate but the obvious counter factual is not the absence of shopping but shopping at a constellation of stores that treat there employees better than wal mart that could exist were wal mart not the default shopping destination. It’s pretty easy.

What’s funny is that in making this argument you are making the same mistake people illiterate in economics make by ignoring the obvious counterfactual for example when people can see only the downside of removing regulation because the beneficiaries of the regulation would be jobs and businesses that do not currently exist.

193 Thomas April 12, 2015 at 5:02 pm

Prove it. Walmart makes 3.5%. Mom n’ Pop’s make more.

194 TallDave April 10, 2015 at 11:46 pm

My personal favorite: “Imagine society without the top income quintile.”

195 bobE April 11, 2015 at 12:03 am

Anyone who is a “walmart critic” should probably not be taken seriously.

196 Mike in Beijing April 11, 2015 at 4:28 am

Hookers give men choices. Who are women who turn me down to criticize them?

197 Los Ranchos April 11, 2015 at 9:45 am

You have to believe there is zero consumer surplus, or large externalities to criticize Walmart from a market failure point of view. Externalities that put other people out of business obviously create consumer surplus so don’t go there. Do people want to make that argument?

198 mike April 11, 2015 at 1:01 pm

“Walmart critics embrace two moral standards: in the first, morality requires payment of high wages to 1.2 million people. In the second, morality can be achieved without employing anyone at all–that is, by paying zero wages.”

Hmm. High wages? Zero wages?

Simplistic arguments?

Who says $15/hr is high? Certainly no family who has to live on that level of income.

JWatts says: “Personally, I don’t understand why they don’t demand that Walmart raise wages to $25 per hour. After all that’s the median household income in the US. $52,000 per year would still fall far below the American dream for a very large proportion of American households. When one looks at the shares of aggregate income received by each quintile of households, one finds that:

Q1 = 3.2%
Q2 = 8.4%
Q3 = 14.4%
Q4 = 23.0%
Q5 = 51% and of that, the top 5% = 22.2%
http://www.census.gov/hhes/www/income/data/historical/inequality/

Fully, the bottom 80% of households earns only 49% of aggregate income, while the top 20% earns 22.2%. Roughly half of the households of the country earn only somewhere between 11.6 and 25% of aggregate income. Clearly there is a very disproportional distribution of income (the famous “inequality” distribution that has been documented.)

The second position – that the alternative to paying “high” wages is paying “zero” wages is ridiculous on its face. No one is demanding a labor cost that is not achievable in a just (defined as fair) society. A fairer distribution of income between capital (which some argue has been over-valued in recent decades) and labor (inadequately valued) will avoid killing the golden goose American economy, built by the creation of a great middle class post WWII when productivity gains were more equitably shared.

If morality is equated to justice, then who is really being moral?

199 meets April 11, 2015 at 5:01 pm

“No one is demanding a labor cost that is not achievable in a just (defined as fair) society.”

So like the original post said, it’s better to offer no wages rather than “unfair” wages.

200 TallDave April 12, 2015 at 12:59 am

You speak of “income” as though it falls from the sky — the real gap in society is not income, it is the value production from which income flows.

Who says $15/hr is high? Certainly no family who has to live on that level of income.

There are probably around 3 billion people in the world who would see that as a vast improvement, mostly because they live in countries who have not figured out the above statement.

201 Colonel Nogov April 12, 2015 at 10:43 am

The markets are so distorted and have been for decades due to the federal reserve(money printing, interest rate manipulation) and the government(licensing, regulations, price fixing, taxes). Any realistic price discovery is impossible.

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