Kathy G writes:
I thought it was as good a time as any to begin a project I’ve been contemplating for a while now: an occasional series of posts about why Wal-Mart is the single institution that, above and beyond all others, represents the despotism, moral depravity, and sheer viciousness of American life in the 21st century. As surely as the motto of this humble blog is "Écrasez l’infâme!," there is no better synecdoche for the modern infâme than Wal-Mart.
Here is post one in the series. Here is the next paragraph:
Why Wal-Mart? For one thing, Wal-Mart is huge. It is America’s, and the world’s, biggest company (in terms of revenues), and also America’s, and the world’s, largest private sector employer. Using the figure listed here on Walmart’s 2007 revenues, and the figures for the U.S. GDP in 2007 listed here and here (which all give slightly different estimates for the GDP), I calculate that Wal-Mart’s revenues are equal to approximately 2.7% of the gross domestic product of the United States.
It is argued that Wal-Mart has a negative net effect on U.S. wages. I would sooner stress that Wal-Mart has boosted Chinese wages and lowered inflation rates (and thus raised living standards) for many poorer Americans. On the negative side it might be argued that "jobs selling toys" pay less than "jobs making toys." Even if that is true, perhaps America would not have kept the jobs making toys anyway, thus making Wal-Mart a net increase in the demand for labor. Alternatively, you might argue that Wal-Mart’s competitive prowess induces other firms to work harder to cut labor costs. Again, this story works only if you start with a net increase in the demand for labor from the side of Wal-Mart. Can the induced "get rid of the x-inefficiency of overpaid workers in other firms" effect be so large? I am still inclined to side with Wal-Mart as providing a net increase in the demand for labor. Kathy G, it seems, sees the matter differently.
Read the whole thing.