How much community did WalMart bring?

The coming of WalMarts took away or weakened various downtown communities, but it turns out that when Walmart leaves a region there are some similar kinds of effects:

Economic losses are only one aspect of the hurt felt locally as a result of Walmart’s passing. There is something intangible, less material – and more chilling – about the fallout, something that seems to flow from the dependency the people of McDowell County developed on the retail magic conjured up inside that big box…For Dan Phillips, Walmart was a way of coping with bereavement after his wife died a few years ago. ‘If you were lonely and had nothing to do, you’d go to Walmart to talk to folk. It was a great social network.’ Being a schoolteacher, Phillips has a theory for what happened when the store closed. ‘Socialization. We lost our socialization factor. Now it’s hard to keep track of people, there’s no other place like it where you can stand and chat.’

Here is the full story, via the excellent Kevin Lewis.


So the Guardian web front page is not on the daily reading list, is it?

It has a registration wall, so annoying. I usually read just the first paragraph.

WMT stock is a buy. I strongly recommend it. They are cutting their unprofitable stores, including, ironically enough, not just small towns like in this article but San Fran- Si Valley - Bay Area CA USA. The Walmart store in Tysons Corner, DC area is very busy whenever I pass it, with low food prices equaling Aldi's. I also think they should cut their unprofitable Brazil exposure but TR might not agree--TR?

I do not care. Brazil already have the best groceries and supermarket in the world. I never bought at a WalMart.

I must concur, my recollection from 2006 is buying filet mignon for either USD 2/lb or USD2/kg in Rio.

Other than that, it was overpriced. I did bring peanutbutter to my host, either because he couldn't find it, or the prices were astronomical.

Such a confused story, it can't decide whether it was worse for Walmart to be there to not be there. It ultimately seems to argue that Walmart should never have gone there in the first place because people would miss it so much once it was gone. Maybe an extreme form of loss aversion?

It kind of is, to be honest. Which is why reading this excellent week old Metafilter thread can be worthwhile -

The story is from the Guardian. Anything big corporations do -- especially Wal-Mart -- is bad.

That's the beauty of the oppressor-oppressed axis. (See Arnold Kling's three axes of politics.) One can read an oppressor-oppressed (or "privilege") story onto literally any situation. Privilege is unfalsifiable. If a "greedy" corporation like Walmart doesn't serve or leaves an area, then it's neglecting the people there. If it does locate in an area, then it's exploiting people there for profit and driving mom-and-pops out of business. When tech companies hire high-wage workers, then they're not creating enough working class jobs. When Walmart hires lots of non-college educated workers, then it's exploiting low-wage workers. Non-interaction (a.k.a. "neglect") is a sign of privilege, as is interaction (a.k.a. "exploitation").

Game. Set. Match.

The great economist, Arnold Kling

Isn't this a bit of privilege projection of yours? It seems easier to debate from the sidelines the rational or philosophical or economic or libertarian merit of the not so free market like Walmart while ignoring the real human impacts and costs. Do you BC live in small community that has experienced this loss? A large corporation comes in to smaller communities and under cuts the prices (subsidized prices no doubt from other larger communities and scales) of local shops and then leaves when their bottom line is no longer met. I don't mean to be overly sentimental, but having spent time in communities that have experienced this dynamic I've seen the impacts in 1/2 empty main street shop fronts, lost local jobs and vitality and people now needing to drive much further to get their daily breads. So while resting on ones libertarian high horse how about also at least acknowledging the deleterious impacts big box retail can have on smaller communities.

"Impacts" isn't really a word. Using it at least three times in one paragraph makes this reader wonder whether the ideas groping to be expressed are of the same quality as the prose.

Oops, grammar police. Seems a bit of a straw man Richard.

How dare the newsman not tell me what to think! I'm so confused!

The problem is that West Virginia is close to DC and the Northeast so all the enterprising people leave and have left. Along with most of the people in general. As the article notes, "McDowell County has seen a devastating and sustained erosion of its people, from almost 100,000 in 1950 when coal was king, to about 18,000 today."

So the departure of Walmart becomes devastating because there aren't enough enterprising people around to take advantage of the monopolistic opportunities available of being one of the few sellers in town.

so all the enterprising people leave and have left.

This is an idiot statement. The place has its problems economically and socially. It also has a working population north of 700,000. Who do you think they work for?

‘Socialization. We lost our socialization factor. Now it’s hard to keep track of people, there’s no other place like it where you can stand and chat.’
It is sad that socialization needs a walmart! Why not talk in a park? a pub? a restaurant? The church?

There's still McDonald's:

which according to the article is benefiting from the local Walmart's demise:

She has noticed that processed foods seem popular again; there are long lines again at the local McDonald’s.

"Why not talk in a park?"

Someone Needs to read some Jane Jacobs. Parks are often not effective at fostering these sorts of Connections, it depends on heavily on their surrounding Location and context. I am almost certain that the parks in places such as These are exactly the wrong type. The thing about meeting people is that they are not talking about Setting up pre-planned meetings at specific times but rather spontaneous meetings because they know all their friends and neighbours routinely stop by the Wallmart they can Count on seeing someone they know whenever they go. Outside of maybe Church its tough to build real communities if all all you have are pre-planned meetings at restaurants with close friends.

JAMR Commenter--

Amen, amen, say it again

Exactly my thoughts. If Walmart really was their main venue for socialising then the community has bigger problems than a supermarket closing.

Yes....but the Walmart itself likely destroyed whatever the community had before which was probably a collection of smaller locally owned shops, possibly located in a denser town center/main street area. This would have previously been the meeting area for people in the town, Walmart destroyed this and created a new ecosystem in place centred around everyone going to the Walmart. But now that is dying too.

This seems highly plausible to me.

Local stores, diners, a commercial area around a square, etc. work fine as places for casual socialization. If they are there.

And now there's an opportunity for an enterprising person to take advantage of the virtually nonexistent competition. But most such people left already.

What do you mean non-existent competition? Amazon exists you know?

Amazon customers tend to be wealthier:

Also these people will pay a premium for physical stores because there's nothing to do there.

Totally agree with you JAMR, thanks.

Well, to start with, the guy mentioned in the excerpt? Yeah, that guy's a single male - he wouldn't be allowed by himself in a park today.

Park - not unless you have kids. I'd feel creepy going to a park as an adult without my kids.

Pub - too loud

Restaurant - place to socialize with predetermined friends and family, not a place to meet others.

Church - good idea, but what if you're agnostic or atheist - then you're out of luck.

"Park – not unless you have kids. I’d feel creepy going to a park as an adult without my kids." I don't live in the US so perhaps there are things I don't understand about parks there. I stayed i in the UK for a few months and I used to visit the parks alone and found other adults doing the same. And I used to socialize quite a lot there.

"Pub – too loud": Not all pubs I went to in the UK were loud. I recollect academics from the local university used to meet in a pub where they used to discuss heavy intellectual stuff.

"Restaurant – place to socialize with predetermined friends and family, not a place to meet others" But the guy's complaint is with Walmart gone "Now it’s hard to keep track of people, there’s no other place like it where you can stand and chat.". Why not keep track of people in a local eatery, like McDonald's? In a small town there maybe very few eateries, making them good places to "keep track of people". And why not stand and chat there? in the UK I used to see people chatting outside a McDonald's , Surely this is possible in the US too?

"Church – good idea, but what if you’re agnostic or atheist – then you’re out of luck." OK. But when in a small town the only joint for socialization is no longer there, and that gets you depressed, an atheist may have to compromise: better start going to church if only to socialize, if that will save you from going crazy.

Already, she spends half her $1,200 post-tax monthly salary on car insurance and repayments, and gas for the long drive for groceries eats into the little that is left.

A built environment oriented around cars seems to function as a pretty hefty de facto tax on people (and then actual taxes have to be spent building and maintaining it). That said, I wonder if some of these people are spending more on cars than perhaps is prudent. I was a bit struck by the third photo in the article and the seeming contrast between the condition of the homes and the SUVs out front:

"A built environment oriented around cars seems to function as a pretty hefty de facto tax on people "

Yeah absolutely that's already been a long-standing problem for inner-city people left stranded when jobs move to suburbs. Sometimes there are public transit systems but often These are completely inadaquet or non-existant.

Looks like she may live in the house to the right, where you can only see the staircase, and all those houses in the picture are abandoned and just function as a parking lot. Even if her house isn't fallling apart though, I can't say that's a budget plan I'd recommend.

This $1200 figure sounds very anomalous to me. The typical resident who needs to drive that lives there probably has a 10-20 year old 4WD beater that they maintain themselves and perhaps a 10-20 year old sedan if you live close to the highway. Charleston is a 100 miles away. You could go there every other weekend and get most of the stuff you need. This would be a great place to retire if you love nature. The trouble I'm sure would be lack of nearby doctors.

"there’s no other place like it where you can stand and chat": in some countries that's called a pub.
If you don't like beer buy an elderflower pressé.

If people from these depressed areas started hanging around pubs how long would it be before I start seeing articles/Posts from the Tyler Cowen/David Brooks/Ross Douthat/Charles Murrey crew about what weak morals These People have because they spend their time in pubs?

I'm sure you would only be waiting until the heat death of the universe

In other cultures it's called a cafe, and in others tea houses. Even in societies which have a fairly strict gender segregation the women find their own places to congregate, it's why you see so many beauty salons in Albania.

What went so wrong with the USA that they evolved socialising out of their culture?

On Saturday I went to a British new town in the Central Belt to watch some football. It was a forty minute walk from the train station to the stadium and I didn't pass a single pub or cafe, just two miles of suburbia. Living there must be genuinely soul destroying.

The demise of the local is fast becoming a problem in the UK though. More and more community pubs are becoming gastro-pubs or gin bars or craft beer houses. As graduates find it hard to get the jobs they studied for they've had to try and raise the status of menial jobs such as barman. What alcohol you drink is now a better status indicator than what clothes you wear. Rather than stick to their local, people are more likely to go further afield to the latest cool place to drink. Community pubs are becoming more and more the realm of the alcoholics and gamblers.

"On Saturday I went to a British new town in the Central Belt to watch some football. It was a forty minute walk from the train station to the stadium and I didn’t pass a single pub or cafe, just two miles of suburbia. Living there must be genuinely soul destroying."

And of course this problem is so much worse in north America with its ample land/popluation ratios. This leads to a lot of very poor planning creating vast tracks of dull suburbia that a lot of lower income people are now stuck in. Everything is only reachable by car so it becomes difficult to have the cafe scene you have in other countries. I guess it functions okay for professionals living there with families who might be too busy to bother with pubs and cafes any way but its not so effective when we move what would have in previous generations been the inhabitants of dense urban tenement slums out to the isolated middle-of-nowhere.That's why these places such as Walmart or McDonalds (in Canada they have the Tim Horton's chain) ended up becoming ersatz cafes in many North American communities.

"vast tracks of dull suburbia that a lot of lower income people are now stuck in."

Suburbia may be dull, but pretty much everywhere, it's where higher income people move to to leave the low income people behind.

Maybe 20 years ago.

The smoking ban killed pubs.
The internet killed socialising spaces.

The problem in the US is we really don't have 'pubs'. We have corner bars, where the windows are blacked out and there's no standing or sitting outside. They're not really social places unless you're a hardcore drinker.

That's a bizarre claim to make -- especially now that we're 20+ years into the U.S. craft-beer/brewpub revolution, which is now being joined by a micro-distillery boom.

You've never been to a real pub in the UK then if you think American craft breweries and gastro pubs, which are more like overpriced fast casual restaurants, are like pubs.

Yes, I've been in British pubs. I didn't say American and British pubs were the same (for one thing, American brew pubs have been opening at a rapid pace for a couple of decades while hundreds of of British pubs have been closing every year. Though the migration of craft-brewing from the U.S. seems to have helped slow the decline). But mostly I was challenging the idea that American bars are typically dank places with blacked out windows, no outside seating, and no place for anybody to socialize but hardcore drinkers.

“It’s all about jobs,” says Melissa Nester, publisher of the local newspaper"

No, it's about money, which is not the same thing. The retired teacher doesn't have a job yet still lives there.

I'm reminded of the phrase, attributed to Gertrude Stein, there is no there there (she was referring to Oakland). Indeed, there is no there there almost everywhere. Is it any surprise that people have lost a sense of community, of the coincidence of community well-being and individual well-being. And one can't avoid the irony of Walmart, well known for importing most of the goods it sells, providing a sense of community in a community of displaced workers and displaced local businesses. Yesterday I took an elderly and frail widow I know to church. I've done it before and will do it again. She refers to it as a "church date". Her excitement seeing and visiting her friends at church was matched by their excitement seeing and visiting with her. I suppose we could have a "Walmart date", but it wouldn't be the same.

"McKinney rattles off a list of all the community facilities that disappeared from the region in recent years as the population declined and the culture of mega-chains like Walmart took root."

The small businesses were eaten by Walmart and Dollar General. I remember the shift. Hardware stores, drugstores, and the small grocery. Did we mourn for them or did we just accept the cheap crap from China that Walmart gave us? A self-inflicted wound combined with the marvels of capitalism/globalism.

Here they turn old Walmarts into churches or bingo halls. Life goes on. You can move or you can adapt to new circumstances.

There's a weak assumption that if Walmart had not arrived, the mom and pop businesses that were displaced would still be there and every one would be OK. Probably not. These mom and pops hired very few people, had less to choose from, and charged higher prices. The quality of their goods was no better and, most likely, was nowhere as good as Walmart's.

Walmart does improve life anywhere it goes: small towns as well as urban areas and suburbs. One should look at its presence as more of a gauge of an area's economic health rather than a force that determines it. The arrival of Costco doesn't make an area middle income. The opening of a Whole Foods doesn't make a neighborhood wealthy. Basements don't create millennials with useless college degrees.

If a town like this didn't have to follow the same regulatory, labor, and minimum wage laws as large wealthy vibrant metro areas, perhaps it could have transitioned to something else after coal died. Maybe, maybe not.

This town and many like it mostly exist only because of various welfare payments of some kind. Not that it is an easy thing to do, but these people need to always be thinking every day about how and to where they are going to move.

We accepted the cheap crap from China because it was the same cheap crap the mom-and-pop sold but for a lower price.

Or, perhaps we bought the cheap crap from China because we couldn't afford much of the expensive crap not from China.

That's the way efficient markets work. Stores close because people find another way to purchase what they want.

There is hope. Just wait until Amazon opens a delivery pick up center at the same location with a Whole Foods store as part of it with fully automated check outs (with RFID buttons on the packaging) and robotic stocking.

A Whole Foods there? That's pretty funny. No, that area is just too small to be served profitably by a full-sized Walmart or probably any big box store. The dollar stores that are there will do OK probably. There are untold thousands of rural places across the U.S. in the same category (too small for Walmart, just about right for Dollar General). The only difference is that McDowell County used to be much more populous and most of the others have always been small.

I thought this may be of interest for economists.

Somewhat related is what Uber did to the NYC Medallion Taxi Industry, sharp declines in (inflated?) market values of NYC taxi medallions/licenses. Did (could it have?) NYC do its "duty" for its taxi licensees?

15 July 2017: NYC Taxi medallion lending and risks posed by Uber competition. The TV news reported that three NYC federal credit unions were placed in conservatorship due to losses on NYC taxi medallion loans.

Several years ago, one of the beautiful, brilliant young women working in our office made a presentation on this. Kudos to her.

I like Walmart. They generally have the lowest prices on cartridges. And, there always is a restroom. That's important for old/enlarged prostates.

"Somewhat related" ... how so?

Maybe this is the time to go long on NYC Medalions. I myself am not sure if Über will continue to exist long-term. The company doesn't actually make money and there are also relatively low barriers to entry to becoming an Über clone if they ever did start becoming profitable .

> there are also relatively low barriers to entry to becoming an Über clone

This does not sound like a reason to be long on Medallions.

I mean maybe these Über-like firms will end up dying out when people realize you can't make money off of it without a monopoly.

Uber may die, but there will be no reversion to the status quo ante Uber. On-demand cab hailing is here to stay. All a medallion entitles you to is street hailing, which is nice, but likely to continue to decline.

Uber somewhat is to NYC medallion taxi woes as Walmart was to Mom-and-Pop stores' problems.

The fatal losses at the three FCU's are more-closely related to lessons needed to be learned concerning losses when collateral values crash and operating cash flows decreased and insufficient to service the related debt.

Short Uber. Short Tesla.

McDowell County, WVa is just about the most ruined locus in America (due to heavy dependence on coal mining); it's population is 75% off its peak. You're not going to garner insights from its experience which have much applicability elsewhere. However, journalists who wish to play forensic games in pushing their agendas can use some cherry-picked examples, so McDowell County, WVa and Owsley County, Ky are trotted out from time to time.

Others trot out the south side of Chicago and West Baltimore to push their agendas. Cherry-picking is for everyone.

I'm really not buying the story. There are still two supermarkets in Welch (Sav-A-Lot and Goodson's), both of which have fairly decent reviews. The idea that now that because Walmart is gone, fresh food is not available and everybody has to eat Big Macs is pretty silly. The only mention of Goodson's in the article is a complaint that it's more expensive than Walmart was. But wait -- isn't Goodson's exactly the sort of local business that lefties supposedly love? The kind that Walmart always kills but somehow refused to die in Welch? Shouldn't that be a feel-good story for the Guardianista reporter -- plucky local supermarket survives?

Here's how the article ends:

Filling the void, as well as helping to create it, came a sparkling new phenomenon: a big box, 103,000 square feet of windowless air, where you could catch up with friends, trade guns, shop to your heart’s content and even take a hike, all within a concrete gash carved out of one of the world’s most breathtakingly beautiful ancient forests. And now that too is gone.

What!? They pointed out two paragraphs earlier that the Walmart opened on the site of an old K Mart. So the opening and closing of a big box store (right there, in that exact same spot) wasn't exactly a 'new phenomenon' and the 'concrete gash' carved out of ancient forests was already there before Walmart came to town.

I love this too:

Peep into the glass doors of the front of the store and you can start to appreciate the brutal simplicity of the Walmart concept. There is nothing inside its windowless walls, just 103,000sq ft of air.

As if they have to explain the mysterious 'brutal simplicity' of an American big box store to their UK readers. Couldn't they just run over to the local Costco?,-6.4569423,6z/data=!3m1!4b1

It's the Guardian. The don't report the news. They craft narratives.

News is narrative.

"She has noticed that processed foods seem popular again; there are long lines again at the local McDonald’s."

" “There’s a lot of people getting sick since the store closed because they’re not getting the right diet. It’s sad to me, but bad food is cheap.” "

You'd think the reporter here would make at least some effort to be credible. If you only want to buy one hamburger than the fast-food product may cost less, but regularly cooking even overpriced groceries at home (beef stew? Spaghetti with meat sauce? Round-box oatmeal for breakfast?) will cost perhaps one-third of what you'd pay to eat even the least-expensive prepared foods.

It is certainly true that a Wal-Mart Supercenter in a small town often becomes a place where everyone meets everyone, at least for aquaintance-level relationships. But, whatever became of the American value of self-reliance, of DIY to solve problems?

There are certainly problems here, and some of them are economic, but, it's hard to take seriously that the closing of the Wal-Mart is anywhere near the root-cause problem here.

The wonderful thing about the Internet -- you don't need to wonder just how 'overpriced' the groceries are there now, you can peruse the weekly ad circular. The prices look pretty normal to me (NY Strip @ $5.98/lb. If I lived nearby, maybe I'd pick some up):

The jingle is pretty bad, though.

"We lost our socialization factor". This is the most Amrican of things. The only place to socialize is a shopping center.

The Strong Towns people have a good account of how Walmart drinks small town America's milkshake:

a) show up in town and promise lots of jobs on a site just outside town. In exchange all the town has to do is maintain road and sewage
b) consumers shift to Walmart and the tax base shifts from downtown. No new revenues are created. Local downtown decimated.
c) the local lawyers and accountants and landlords are put out of business as Walmart has no need of them.
d) the Walmart structure is designed to last 20 years. After 20 years Walmart leaves and builds a bigger supercenter 20 miles further away, taking what's left of the revenues and tax base
e) small town is left with an empty lot and expensive maintenance costs but no tax base.

Ultimately Walmart is strip mining the wealth from the community and then moving on. Meanwhile, the entire time the small town subsidizes Walmart via expensive and unprofitable infrastructure.

Re: BJ dubbS. I agree and note that there is a town in Illinois where Wal-Mart pulled the same hat trick but only moved the store a few miles each time, Each time leaving a large, dead, retail space behind.

This is as ridiculous as people complaining about possibly losing part of their health care if a new plan is passed. Many of these are the same people who had no health care (at least according to some) just a few years ago, now they act as though it is a God-given right that shouldn't be taken away. Things change. Just because you have had access to something for a few years or your whole life, doesn't mean it can't be gone tomorrow. To the point; if Wal-Mart had not destroyed the dozens of small businesses in small town America, the man would have had more than one place to chat with new acquaintances.

Bozos lamented Walmart's arrival and now they mourn its departure. Back in 1885 the fellas sitting around the pot belly stove in Zeb's General Store worried over the new merchandisers Sears and Montgomery Ward. Shucks, you could buy almost anything out of their catalogs, even a house, and it would be shipped right to you via the US mail. How could Zeb possibly compete with that? And that was the end of small town America. Of course it's now also the end of Sears and Monkey Wards.

We have to be wise and keep eye on multiple things instead of just one side whether it’s positive or negative. I am always very careful with how I go with doing things and keep myself in proper shape and that’s necessary being a trader. I work it all superbly and due to broker like OctaFX, I find it awesome with having LOWEST possible spreads at 0.1 pips for all major pairs, fast execution and then there are even 70 instruments to pick from.

Comments for this post are closed