WhatHappensWhenWalMartComesToTown

8/14/2019 WhatHappensWhenWalMartComesToTown

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What Happens When

WAL-MART

Comes To Town.A crash course.

repared and Endorsed by Sprawl-Busters.com


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If you look at thefacts with an open

mind, youll agree

that Wal-Mart is good

for America.

--Lee Scott, Wal-Mart CEOCompany press release 2/23/05


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Handful of Losers.

Its also easy, at some

level, to empathize with

our critics fearsafter

all, the economic changeWal-Mart represents

creates a handful of

losers even as the vastmajority of ordinary

Americans gain.

--Lee Scott 2/23/05


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A Chain of Exploitation

Big box chain stores are

built on exploitation,

and at every link alongthe chain, someone gets

exploited, from the

sweatshops in Shenzhen,to the sales floors in

America.


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Wal-Mart brings

littleadded value to the

community.

They make

nothing.

They gain market share, as

others lose market share. The

result is not economic

development, but economic

dis lacement.


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Growth Is Like

Cholesterol Good growth

adds value to

an economy.

Bad growth

lowers economic

activity in the

local area.

To not know the

difference is

dangerous.


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Wal-Mart Makes

4 Promises to acommunity:

Jobs

Taxes

Philanthropy

Low Prices


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1. Wal-Mart Promises

Jobs It will bring 475 jobs to the

community, 75% of them being full

time (36 or more hours) and 78%

of them eligible for benefits.

-Wal-Mart, Centerville, UT,

4/28/04

BUT: These jobs create losers

elsewhere.


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Learning Wal-Math

1 job

created

- 1.5 job

destroyed

= 1 job


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Wal-Mart Jobs Are Just

Old Jobs in New Aprons


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Examples of Wal-Mart

Voodoo Economics


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The Greenfield, Mass.

Wal-Mart Impact

Study 1993 by RKG Associates of New

Hampshire

High Impact Scenario More retail square footage would

close, than would open at the

Wal-Mart

177 new jobs, but after losseselsewhere = 27 jobs (net)

Net financial gain: $32,000 a

year

Need 20 Wal-Marts to equal 1% on


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As Wal-Mart grew,

22,000 Kmart

Workers Were Laid Off

The company announced that

the closing of these storeswill result in the loss of

approximately 22,000

associate positions.


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21,500 Unemployed

Ames WorkersIn a press release dated

August 14, 2002, Ames

discount stores announcedthat it would close all 327

remaining stores. "It is with

great sadness," the company

told customers, "that weinform you that Ames is going

out of business." 12 Vermont

Ames were closed. 21,500

workers lost their jobs at


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Winn-Dixie Lays Off

10,000 Workers

April 2004: Grocery chain

shuts down 156 more stores.

10,000 lost jobs means the

next 20 Wal-Mart Superstores

only replace those lostjobs.


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The other side of the

WAL Wal-Mart = Voodoo economics Net job gain is negligible

Old jobs in new aprons

Pays prevailing wage: 34hours/week considered full-time

Woman with one child at 34

hrs/week works in poverty

Sued in more than 30 states for

stealing time off the clock


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Off the Clock: Time

TheftAs of December,2002, there were

39 class action

lawsuits againstWal-Mart in 30

states, claiming

tens of millions

of dollars inback pay for

hundreds of

thousands of Wal-

Mart employees.

--NY Times, Jan, 13,


18/49

The Rodino

Associates Report,

2003Big box retailers and

superstores may negatively

impact the labor market in anarea by the conversion of

higher paying retail jobs to

a fewer number of lowerpaying retail jobs. The

difference in overall

compensation may be as much

as $8.00. L.A. Cit council


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We became our own

competition- Sam Walton

Ames, Richs, Bradlees,Caldors.

All in New England.

All of them gone.


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Fewer Jobs

Per Dollar of SaleTo sell $1 million at Wal-Mart

takes 4.7 workers compared to

an average of 6.4 workers insimilar general merchandise

stores. (Tom Muller, The

Economist, 2003)


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Fewer Retail Jobs

It would be a serious mistaketo conclude that these jobs

are net additions to theworkforce. The presence of

Wal-Mart results in FEWER

retail jobs then would beavailable in their absence.

--Tom Muller,

economist


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Wal-Marts Hidden Cost

The typical Wal-Mart supercenter

with 200 workers costs the American

taxpayers$420,750 a year

in tax-supported subsidies,

including earned income tax

credits, housing subsidies, food

stamps, health insurance

(Medicaid), etc.

--Congressman George Miller (D-Ca)


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Reverse:

Tax Welfare for Wal-

Mart Wal-Mart has benefited from

more than $1 billion in

economic development

subsidies from state and

local governments.

-Shopping for Subsidies, Good Jobs

First Research Group


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The Wal-Mart Wage Gap

Lee Scott made $17.5 M last

year

In two hours, he makes what aWM clerk makes in one year.

($16,860)

Wal-Mart subcontractors make:

-17 cents an hour in

Bangladesh & China

-46 cents in Indonesia

-23 cents in Nicara ua


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Jobs At Wal-Mart

(2004 data)

The jobs we provide are the kind

people take to enter the

workforce.Lee

Scott

Sales Associate: $7.05 an hour

Cashier: $7.20

Average hourly Wal-Mart worker

per year: $17,285

Average all retailers: $24,023


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2. Supporting the

Local Tax Base Real estate taxes

Sales taxes

Income tax from storepayrolls

Local tax receipts usuallyincrease substantially when a

Wal-Mart opens its doors.

-Wal-Mart, 1998


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Fuzzy Math Gross figures vs. net impact

Subtract from Wal-Marts

figures all the property

taxes, sales taxes, and

payroll taxes not paid by the

companies that downsize or go

out of business after Wal-

Mart comes to town.


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No Help to

Existing MerchantsNational Trust for Historic

Preservation:

--studied 9 counties in Iowa in

1996

--84% of WM sales from other

merchants

--sales downtown were constant or

declined

--no significant job gains


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There Goes The

NeighborhoodIn Lake

Charles, LA

neighbors of a

Wal-Martsupercenter

watched their

property values

drop 28%within the

first 4 years

after the store

opened.


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Wal-Mart State

Income Tax Shelter Wal-Mart uses a sister company

in Delaware as a tax shelter for

profits.

It makes payments to a Delaware

corporation, calls those business

expenses and reduces its state

taxes by doing so.

The Multistate Tax Commission

estimates that in 2001, Vermont

lost between $7 and $14 million

in corporate taxes through such

exotic tax shelters.


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Dark Stores

Lowering Prop Values

Wal-Mart is systematically

removing their discountstores, and replacing them

with supercenters.

Number of discount storestoday is 473 lower than in

1998.


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Dark Stores

At any point in

time, Wal-Mart

Realty hasbetween 350 and

400 dead stores

on the market.

They call themdark stores.

More than 28

million s.f. of

em t s ace.


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3. Wal-Mart

Philanthropy

Good. Works.

Community grants, United Way

Childrens Miracle Network

Teacher of the Year

Business Leader Awards

Hometown Leader Awards

Acres for America (wildlife

fund)


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The Other Side of the

WAL

According to pretax earning

donated to charity, WM ranked

last among the major

discounters..the WM

Foundation ranked nowhere

near the top 100 corporate

foundations in charitableexpenditures.

-- authors Scott/Vance


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Much of Wal-Mart Good.

Works comes from

in-store promotions or

customer & employeecontributionsnot from

the company itself.


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from the Walton

Foundations has been

given to causes

designed to undercut

support for publiceducation.

The self-described purpose of CEO America

is to work for publicly funded vouchers -

public policy changes designed to divert

taxpayer funds from public schools to

private schools.

-People for the American Way Foundation,


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How much a company

donates to a community

has nothing to do with

land use decisionsanyway.


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4. Outstanding

Consumer Value Everyday low price Philosophy

We deliver consistent value

with a smile.

Wide variety of products

Attractive, clean environment

Generous return & exchange

policy


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The Other Side of the

WALCheap goods at Wal-Mart come

from:

Sourcing products from Third World

sweatshops, costing the US millionsin lost manufacturing jobs.

Muscling suppliers to reduce cost

of labor and materials.

Exploiting its own workforce with

everyday low wages, and off the

clock practices.


40/49

Made in America?

In 2002, Wal-Mart imported

roughly $12 billion in

Chinese goods.

Represents 10% of our record-

setting trade deficit with

China.

Sam Walton called this knee-

jerk import buying.


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3 Million Lost

American Manufacturing

Jobs Since 2000, American has lost at

least 3 million manufacturing

jobs. Pressure on vendors to lower

prices = outsourcing production

to Third World countries= lost

U.S. jobs.

Wages in a race to the bottom

Levi Strauss, Fruit of the Loom,

Master Lockclosed factories,


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Everyday low prices?

Wal-Mart wouldlift its prices as

and when

competitors

disappeared. Nearerto Little Rock,

where there are

plenty of

pharmacies, itsdrug prices are

lower, in more

remote towns,

higher. Arkansas


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Below Cost Pricing

Wal-Mart officials said during

the trial that some items

were priced below cost todraw customers, not to drive

local druggists out of

business.--AP

story, 10/13/93


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We say we sell for less,

which means if a

competitors prices are

lower, we will drop our

prices, even if it means

below our cost.--CEO Lee Scott, WSJ 10/6/04


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Conclusion

What happens when

Wal-Mart comes to

town?


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Low wages.

Lost jobs.

Empty buildings.

No economic growth.


47/49

You cant buy small town

quality of life at aWal-Mart.

But once they take it from

you, they cant sell it back

at any price.


48/49

Its time to think

outside of the box.

For further


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For further

Information:

contact

walmartwatch.com

sprawl-busters.com

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WhatHappensWhenWalMartComesToTown