After reading the NY Review of Books article earlier, I finally sat down and watched the Frontline documentary, "Is Wal-Mart Good for America?" that has been sitting on my TiVo since November. From the transcript, after a sequence describing the role Wal-Mart played in the demise of Rubbermaid:
HEDRICK SMITH: [voice-over] It seemed to me that it wasn't just a plant dying, a set of corporate values was passing away. Ten years ago, Rubbermaid, with its reputation for quality, was named most admired. Last year, Wal-Mart, with its reputation for its cost-cutting, was most admired.[on camera] If you look at the shift from Rubbermaid as the most admired company in 1994 and Wal-Mart as the most admired company today, in terms of the larger American economy, what does that mean? What does that say about the touchstones of success?Prof. GARY GEREFFI, Duke University: Rubbermaid represented an innovation-oriented high road towards U.S. competitiveness. I think Wal-Mart represents a cost-driven, low-price low road towards U.S. competitiveness. And in a sense, they're two dramatically different styles in which the U.S. economy can be organized. I think the Wal-Mart model is winning out.
Now the problem is, even though this isn't news to me, I shop at Wal-Mart. Not often and only for the most trivial stuff, but if even I am drawn there by cheap stuff, how do we ever change things? I won't shop there again.
The show spent a good amount of time on Wal-Mart's relationship with China. It said as many as 80% of Wal-Mart suppliers are in China.
LARRY MISHEL, Pres., Economic Policy Institute: When you look at the growth of the trade deficit with China, you could say that a very conservative estimate is that we have lost more than a million jobs to China since the early 1990s.BRINK LINDSEY, Economist, Cato Institute: I think it's impossible to say that we've lost a million jobs to China. Trade policy, or trade flows, one way or another, don't have an effect on overall employment numbers. They affect the kinds of jobs we have. And so some number of jobs have definitely been eliminated because of Chinese competition. Another– elsewhere in the economy, other jobs have been created because of Chinese competition. Because American consumers have saved at Wal-Mart buying Chinese goods, they've got more money in their pocket to buy something else, which creates business opportunities for those other business, which means they hire workers they would not have hired otherwise. The net effect, most economists think, is a wash.LARRY MISHEL: Theoretically, the gains from trade offset the losses from trade. But nothing says there are more winners than losers, and nothing says that for the bottom three fourths of America, that they are net gainers. In fact, I believe that most people have been losers from trade.
On the whole I've been sympathetic to the free trade rhetoric. I'm a product of the mainstream, corporate media. Shows like this one make me rethink.
