Every day, between the crack of dawn and sunset, a single American entity spends nearly $36 million on real estate, sells more jewels than Cartier and Tiffany, bags more groceries than any other corporation and rakes in over a billion dollars in gross sales in the process.
What is this mighty if eclectic behemoth, you might ask? Wal-Mart. We (as in Americans) are so enraptured with founder Sam Walton’s big, bad retail baby that it recently surpassed ExxonMobil to become the country’s largest corporation. Roughly one in 100 of us works there, and that number will grow. A new Wal-Mart superstore opens every day.
Wal-Mart is so big, in fact, that Colorado Springs writer and occasional Indy contributor John Dicker spends the first third of his informative and zestfully outraged new book, The United States of Wal-Mart, trying to calculate its size. Numbers alone don’t do the store justice, simply because they’ve passed the point of being comprehensible. Take $288 billion, which is how much Wal-Mart collected last year in sales. This means that if Wal-Mart were its own sovereign nation it would be larger than 80 percent of the world’s countries, including Sweden and Israel.
In the past decade, Wal-Mart has evolved into the 800-pound gorilla of retailing—it sells more DVDs, dog food, diapers, books and bicycles than any other company in America. The only thing it loses out on is toilet paper, which flies out of Costco at a faster rate.
The United States of Wal-Mart is a primer on how they do it, why they do it and most importantly, how their dominance of retail has become increasingly damaging to America. The how and the why are interesting but not especially new. Anyone who has ever found himself sitting with a wrinkled Businessweek has probably already read about the company’s legendary supply chain management system—a gigantic computer in Bentonville, Ark., that houses more data than the entire Internet. When a kewpie doll gets bought in Sacramento, Calif., the computer registers the sale almost instantly.
It wasn’t always this way. Sam Walton built the chain from the ground up in 1962 on money borrowed from his wife and her family. The son of a man who repossessed the property of people moving West during the Dust Bowl, Walton had a maniacal urge to win—but he never knew what to do with his loot because he was too busy trying to grow his store. One of the last people to speak to him on his deathbed in 1992 was a sales manager.
Big hasn’t always meant bad in corporate America, Dicker points out. He argues that in the ’50s General Motors—then the largest American corporation—became an industry leader in how it treated its employees. Wal-Mart, on the other hand, lags in almost every regard in how it treats its “associates.” Unions are not allowed in their store; if there is any hint of organizing Wal-Mart shuts down and moves on. Not surprisingly, compared to other grocery workers, Wal-Mart employees are paid a much lower hourly wage.
And they certainly don’t make up for it with princely benefits. In a twisted bit of corporate logic, CEO Lee Scott (whose annual compensation package approaches the $20 million mark) has actually convinced workers that they are helping keep America’s health care costs down by covering around 42 percent of their own health care costs. The result? A single worker could wind up paying up to $6,400 out-of-pocket—or 45 percent of the average annual full-time salary—on health care premiums.
And here is where it gets rather diabolical. Instead of being a responsible employer and picking up some of these costs, Wal-Mart passes them onto the states in which it does business. According to Dicker, Wal-Mart actually encourages its employees to apply for public assistance. So the same states that lure Wal-Mart to the neighborhood with tax breaks must then turn around and subsidize the health care of its employees. In this fashion, a single 200-employee Wal-Mart actually winds up costing you and your fellow tax payers half a million dollars.
The United States of Wal-Mart does a wonderful job of marshalling these stories from previous articles, but it probably would have benefited from more boots-on-the-ground reporting. Dicker is so thorough at mastering the blizzard of damning statistics and reports that he forgets that the most effective tool in describing how harmful this company is would be to tell the stories of people who work there. David Shipler did this in his book, The Working Poor, and it’s a miracle the results haven’t started a class riot yet.
In a way, Wal-Mart’s size is one of its most potent weapons: the list of its outrages, from the use of illegal aliens to locking people inside stores during night shifts, is so long you almost don’t know where to start. Read about it from the outside and it’s easy to forget that real people actually work there.
That lack is what makes The United States of Wal-Mart such an enraging but also depressing book. Wisely and frequently, Dicker reminds us that we aren’t actually forced to shop there; but we keep doing it. Conscience, the Bentonville savants have realized, is not part of the value equation.
It’s funny—throughout this book, Dicker irreverently refers to us as Wal-Mart’s bitches. Finishing the book, I think that’s too fond a word. Considering the way the behemoth does business, and the way we do business with them, I think “whore” would be a more appropriate term of endearment.