Its getting around the time for the Holidays and everyone is going crazy over where to get the best prices for their gifts and hands down the place most people turn to is Wal-Mart. But if Wal-Mart is a place that everyone goes to do their Holiday shopping because they have the lowest prices then why does Wal-Mart take so much heat from people in the areas where their stores are located? It is because in the process of giving the consumer the best possible prices and large range of choices they also destroy local businesses, but I asked the question, should Wal-Mart be persecuted for good business practices? Some people see Wal-Mart or the other Walton creation, Sam’s Club, as a detriment to society that destroys original American norms that Tocqueville said created the American way of life. I agree that Wal-Mart and other massive superstores to destroy the sense of community and commonwealth that we’ve been discussing all semester but at the same time they make every single consumer in the market better off with their low prices and great variety.
In my opinion, Wal-Mart should not be discredited as they are right now by the media as being cheaters but rather as being a genius of business. Their size and efficiency make them able to take advantages of economies of scale which means they get more products at a cheaper price because they have such a massive share of the market demand. They are just taking advantage of their size and from doing this they are being criticized for it. I do realize there are many negative impacts from Wal-Mart that they destroy jobs and local businesses but they make the consumers better off and there is also a transfer of jobs to Wal-Mart. There are both positive and some negative effects from Wal-Mart but from a strictly economic perspective there is an increase in consumption with a lower price which is a positive economic outcome. This is probably very different from most peoples’ viewpoint but this argument makes the case that Wal-Mart is a display of business genius. Unfair as Wal-Mart’s practices appear to seem if one of us wanted to get a product for a very low price we would turn to Wal-Mart because they have the lowest prices guaranteed. The media or local communities hate them for awhile usually right after the store opens but over time we start to come around simple because they are the best at selling products at the cheapest cost.
Wal-Mart is also a case of capitalist exploitation in that they are a profit maximizing firm. The lone worker has little power in the case of Wal-Mart making it a perfect scenario for a Marxist ideal that the working class gets exploited by the Capitalist because they hold the power in the company. This is where Wal-Mart could be seen as the evil powerhouse they are in some cases. However, the goal of every business is to stay afloat and maximize their revenues and profit and Wal-Mart is bigger than most businesses in America so they have to adopt different, sometimes seen as unfair, power over their employees. Most of the employees we come into contact with in the stores are at the bottom of the food-chain and because of this they are the most expendable, less-skilled employees. Wal-Mart needs these people but at the same time they are the easiest to replace so they feel there is no need to pay them the highest wages. This is capitalism at its finest but if one were to interfere with this by raising the minimum wage Wal-Mart could be the one that pays the price. This would be catastrophic because Wal-Mart holds such a large share of the market and if they didn’t exploit their workers at the lowest end then a market failure could exists which the economy couldn’t afford. No Wal-Mart means we will have to go back to buying higher priced goods at lesser quantities. As unfair as Wal-Mart may seem to their lowest-skilled workers this may be necessary to give the consumer everything we’ve been used to.
How do you view Wal-Mart? Do you see them as a genius in the business world or as a detriment to the American way of life? Also how well do you think they fit into the category of a profit crazy capitalist we saw explained by Marx?