is wal-mart good for america? [home]
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Dear FRONTLINE,

Dear Frontline,

I am a mother of four young children, and I admit, I had gone to Wal-mart often because they made the medicine so affordable that I need for my 3 asthmatic kids. I am a supporter of Bush and hope that perhaps a socially-conscious capitalist might hear such a message and not be unmoved. HOwever, I'm absolutely convinced that such a problem cannot be solved without the help of the raised conscience of consumers and CEO's alike. Listening to the Wal-Mart executive you interviewed, it was hard to disagree logically with the defense he gave. But the Bible doesn't lie where it says "The love of money is the root of all kinds of evil." Until people decide to make decisions not just with their pocketbooks but with the welfare of others in mind this problem cannot change. I, for one, though I don't have much in the way of extra disposable income, am willing to pay extra money for a clean conscience.

Cindy Stokes
Leander, Texas

Dear FRONTLINE,

The idea, as some in this forum have suggested, that any company who is given the chance to do business like Wal Mart will do so, is absolutely untrue. There are still companies out there who place their employees’ well being and that of their community above massive profit margins and cheap prices. I work for one, and while we struggle to compete with Wal Mart, we are successful because of the quality of our workers. And how do we get quality workers? We treat them with respect, pay them fairly and provide decent benefits.

In the “pep rally” segment of the show, there were items being talked about with an 80% mark up. Is Wal Mart really passing on the savings of manufacturing their products in China? Not if they can mark an item up 80%. The only one benefiting from that is Wal Mart. They could have had the same product manufactured in the United States, sold it at a fair price and still made a profit. Instead, it looks as if they are selling products made in China at the same price as those made in the U.S. and pocketing the difference. I may be wrong, but how else do you explain an 80% markup on goods?

Is Wal Mart good for America? Absolutely NOT!

T. W.

Dear FRONTLINE,

The Frontline show on Walmart is, I believe, demonstrative of a larger issue. In the past, US manufacturers have used the strong dollar as one way in which they were able to compete against each other. Thankfully, in the past, there were a number of other criteria on which manufacturers would compete for shelf space with retailers to include features, service, warranty, etc.

Walmart, with their low price strategy has changed the game and removed the other criteria as ways by which manufacturers can compete and left only price. The strong dollar now, especially with China, puts maufacturers in the position of needing to move to China or other low cost wage countries to compete as suppliers to Walmart.

However, the situation of the dollar being strong relative to the Yuan and other currencies can not last forever. The combined current account and budget deficits over time will create a situation where other currencies will strengthen versus the dollar. Sadly, when this happens, the price of goods, even the low prices at Walmart, will rise. When this happens, and it will, the steady increases in consumer sales at Walmart will be a thing of the past. The only question, in my mind, is how painful will the reduction in our standard of living be?

John V
cincinnati, OH

Dear FRONTLINE,

PBS stands for Publicly Broadcast Socialism. You make special targets of the most successful capitalists and try to make them into villains. Via the envious voices of suppliers and competitors, you present as tho you are revealing wrong doing. They would all be Walmart, if they only could.

Dan Althoff
Jacksonville Beach, Florida

Dear FRONTLINE,

I've worked for a company whose biggest customer is Wal-Mart for over 11 years, and I have a few observations about your segment. ...

Opening price points are also not a Wal-Mart innovation. The idea of "trading up" or even "bait and switch" has been around in retail way before computers existed. Think about the incredibly low price on that new car and showing up on the car lot to find out that it has been sold, or how about seeing a great price on that TV only to have the electronics store sales person try to "trade you up." There are retailers ... that would actively try to steer you away from that "bargain" that was advertised in the newspaper circular. At least the Wal-Mart practice is left totally to the consumer.

... We have NEVER been asked to open our books to Wal-Mart, and there is no way that Retail Link, bar codes, or POS data can provide financial statements about a manufacturer to its buyers.

Wal-Mart didn't force any of its manufacturers to move to Bentonville. They did it on their own to try and get a competitive advantage. Rubbermaid proudly touted their Bentonville office with a complete mock store and the same carpet and cubicles as Wal-Mart's Home Office earlier this year on NPR.

Wal-Mart's ethical standards are far above those of most of the other retailers we supply. They actually enforce their no gift policy. Most other retailers' buyers are "on the take." They are in it for them, not for what's best for the company or the consumer. We have regularly arranged ski trips, vacations, and other extravagant gifts for buyers at some of the nation's largest retailers.

Understanding the power of Retail Link probably requires understanding what other retailers do. At most other retailers, if you want POS data, you have to pay them for it. Many retailers have arrangements with companies like IRI and Nielsen who sell their sales data for them. Wal-Mart's supplier systems are much better than anything any other retailer offers and they give you access to the data for free! They give you the data for free, because they want their manufacturers to do the analysis for them. This is why the buyers really DON'T understand the business as well as Mr. Lehman portrays. Wal-Mart has a culture of depending on its manufacturers to use Retail Link and other sources of data to help them run their business. ...

Patrick Bowman

Dear FRONTLINE,

Dear Frontline,

Thank you for bring to air some serious issues. I have been manufacturing items in China for 6 years and we sell them under national brands. I do it because the American people will not pay more for goods "Made in America", so to keep up with competition, we go overseas.

Two things would help the situation. One, a tax on imported goods that would balance the wholesale cost of US vs. Imported goods. Two, limiting the breadth of businesses a corporation can be involved in. The beneift of the first is obvious, the second less so and will take some thinking from your readers.

Good Luck USA

michael murray
beverly hills, ca

Dear FRONTLINE,

Dear Frontline,

It seems to me that Wal-Mart's fate is tied to that of the U.S. worker. If he doesn't have a good steady job who is going to buy Wal-Mart's products?

David Springer
austin, texas

Dear FRONTLINE,

What is incredible to me about this is that it's MANUFACTURE workers who are also flocking to Wal-Mart on payday even though it's their very jobs Wal-Mart threatens. Nearly all of my family work in factories where jobs are being lost daily and the threat of the company going overseas is real...And a point many who are supporting Wal-Mart as part of "fair trade" are missing the that Wal-Mart has gone to court on the side of China based companies when American industry has filed lawsuits because these overseas companies are DUMPING products onto the American market in absolute violation of the world trade agreement -- having the direct effect of pushing prices below market value where any company paying fair wages and benefits can't survive.

It is far darker than fair trade and capitalism. It is a war against American industry and the standard of living Americans have enjoyed. Drive through middle America and look at the empty store fronts and businesses and then tell me Wal-Mart is good for the economy.

I will not shop at Wal-Mart and I encourage everyone to ask for products manufactured in America.

Kelli Stamper
Lake Havasu City, Arizona

Dear FRONTLINE,

I disagree strongly with the argument made by the Cato Institute economist that consumers have more money in thier pockets to purchase goods from other manufacturers because of Wal-Mart's low prices. I believe that whatever money is saved on the "opening price point product" is probably spent on other items before the customer ever leaves the store. The Waltons are not squeezing their suppliers and underpaying their employees for the good of the customer, they're doing it for the good of the Waltons and negatively affecting the U.S. economy in the process.

T Beesley
Salt Lake City, Utah

Dear FRONTLINE,

There should be more study of what the exporting of jobs has done to the remainder of the health insurance coverage in this country. (Please consider this a suggestion to build on your Wal-Mart story!)

Has anyone stated that we have reached the tipping point where the loss of jobs with health benefits have helped cause the rise in insurance premiums? The listening/viewing public, including myself, tend to hear about “rising health care costs” and tend to think of where the costs are coming from—drug companies, new expensive equipment and treatments, etc. but not from the shrinking pool of insurable people who can continue to pay for coverage but with spiraling premiums.

I had to discontinue my coverage I had through a professional association last year because the premiums had risen 300% in just a few years until it was going to take 25-30% of my gross income to maintain catastrophic coverage for major medical expenses.

Rush Loughridge

Dear FRONTLINE,

While I was somewhat concerned by the apparent appeal to protectionist sentiment as I watched this very informative documentary, it was downright scary for me to watch the segment filmed at the Port of Long Beach. We often see statistics and commentary about the US current account deficit and dire warnings from economists about the imminent collapse of the US dollar, but we almost never witness concrete examples of these deficits in the real world.

As long as Wal-Mart's shareholders demand that the company beat its earnings estimates every quarter, it will undoubtedly continue to ignore the long-term impact of its business practices on the stability of the US economy until it is too late. All the while, the Chinese can patiently bide their time until they take the stage.

David Simmons

Dear FRONTLINE,

Walmart is so successful because it does a great a job of telling consumers what it is all about - low prices! We consumers need to do a better job of explaining to retailers what we want -better service, stronger commitment to our communities and jobs with a real future. The great danger of Wal Mart's success is that the low-price mantra will infect every segment of our commerce and society to the detriment of quality, service, and even our own humanity.

Joseph Godin
Teaneck, NJ

Dear FRONTLINE,

PBS and Frontline has again provided us with another eye opening situation in America. How do we respond to this problem which the free market capitalist have brought to our door step?

This show isn't just about Walmart, but about the apathy and unwillingness to debate these issue individually and in public forum. Are the people who work at Walmart really happy...low wages, low benifits, low prices,,,is that what they want.

I feel it is time for a break up of Walmart and any multinational company who dominates a market under the laws of monopolization.

Or is the show about multinational companies who have so much influence in Washington that our voice doesn't count.

Thomas Schreder
Sobieski, Wisconsin

Dear FRONTLINE,

I was born in Chillicothe, Ohio and was raised in Circleville, Ohio. Circleville was mentioned in the documentary because of the closing of the RCA plant due to cheaper television tubes being produced in China. This is very true. I do want to point out something that was not in Forntline's short film. Circleville ALREADY has a Wal-Mart! It is less that a mile north on US 23 from the RCA plant. This Wal-Mart is closing soon because there is going to be a NEW Super-Wal-Mart Across the street. This S-W-M is next door to the RCA Plant! This was mentioned by Frontline. A 2 Wal-Mart Town.

I love my little hometown town. I moved away several years ago to go to college and graduate school. Now the S-W-M may be one of the three largest enployers in Circleville next to PPG and DuPont. There does not seem to be a chance for me to move back anytime soon.

Jeremy Vaughn
Philadelphia, PA

Dear FRONTLINE,

Wal-Mart may offer low prices on many consumer goods but one point that was not mentioned is that many if not most of the consumer goods on Wal-Mart's shelves are not needed by consumers. Going back to last week's Frontline, we have been persuaded to persuade ourselves that we need these things. It seems that consumers are constantly trying to buy contentedness but in the end it never works. I haven't shopped in a Wal-Mart in years and don't feel I have missed out on much at all.

Alison Dudley
Kansas City, MO

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