Is Wal-Mart Good for America?

In addition to being the largest retailer in the United States, Wal-Mart is the largest retailer in the world, with stores in Canada, Mexico, South and Central America, Puerto Rico, Europe, the United Kingdom, China, and Korea. In the United States, over a hundred million people shop at Wal-Mart every week. In 2000, Wal-Mart opened a new store almost every two days, and in 2004, it began opening a new stores almost every day. (This does not include Wal-Mart discount stores and Sam’s Clubs.) Most Wal-Mart stores are megastores, measuring over 200,000 square feet, and include groceries, pharmacies, and hardware and garden supply areas. With 1.2 million employees and 3,600 stores, Wal-Mart is the largest employer in the United States after the federal government.

Because of its size and its dominance of the discount market, it is not surprising that Wal-Mart has had its share of controversy. Critics point out, for example, that given its large sales volume, Wal-Mart contributes little to charity. Another criticism is that despite a “Made in the USA” advertising campaign, the majority of products Wal-Mart sells are made overseas, often in sweatshops in developing nations. In addition, critics assert that Wal-Mart keeps its prices down and its profits up by paying low wages and by not providing health care for many of its workers. They point to the fact that even though Wal-Mart’s starting salary is the same as that of other discount retailers, it is significantly lower than its competitors at the end of an employee’s second year. Critics also condemn many of Wal-Mart’s other employment practices. Currently, Wal-Mart is fighting a class-action sex-discrimination lawsuit. It has also been fined by the government for employing illegal aliens and for locking the exit doors to some of its stores at night. Finally, it has doggedly opposed unions any time they have attempted to organize workers.

The writers in this debate hold very different opinions concerning Wal-Mart. In “The Case for Wal-Mart,” Karen De Coster and Brad Edmonds attempt to refute many of the criticisms leveled at Wal-Mart. According to them, by enabling lower-income people to buy a host of products at very low prices, Wal-Mart performs a service to the low-wage communities it serves. In “Down and Out in Discount America,” Liza Featherstone disagrees with this assessment, pointing out that Wal-Mart’s business model requires a large number of low-wage customers. For this reason, says Featherstone, it is in Wal-Mart’s best interest to keep the wages of is employees low so that they, too, will have to shop at Wal-Mart and further increase its customer base.