August 30, 2006
Wal-Mart round-up

Robert Samuelson invites Congressional Democrats to put-up-or-shut-up regarding Wal-Mart:

"Congress should just buy the company and then legislate good behavior. Wal-Mart executives 'talk about paying [workers] $10 an hour,' Sen. Joseph Biden told a rally in Iowa, according to the Times. 'How can you live a middle-class life on that?'

"Well, if $10 is too little, the government could order the Department of Wal-Mart to pay more. How about $15 or $20? Similarly, if Wal-Mart's health insurance is inadequate, Congress could command more coverage."

Other recent defenses of the company include Rich Lowry and Jonah Goldberg on NRO; and Michael Strong on Tech Central Station. Strong roughly estimates that Wal-Mart may be "single-handedly responsible for bringing about 38,000 people out of poverty in China each month, about 460,000 per year."

(Just after I posted this, I noticed that Frank had already highlighted Strong's article. This additional nod shouldn't hurt, though.)

Update: One more -- Richard Vedder and Bryan O'Keefe in The Washington Times: "Take Mr. Biden's comments. Contrary to his claims, there is enormous economic evidence that Wal-Mart's has helped poor and middle class consumers--in fact, more than anybody else. Our own data analysis shows Wal-Mart is concentrated primarily in smaller, rural counties with a per capita income far lower than other retailers, like Costco. And, unlike the picture painted by labor activists, when the Wal-Mart moves in, good things happen. Looking at 25 small towns where Wal-Mart opened stores in 2002, we found employment growth was much stronger in 'Wal-Mart communities' than in other areas.

"Other academics have reached similar conclusions about Wal-Mart's positive effects for the poor and middle class. University of Missouri economist Emek Basker shows Wal-Mart's presence tends to lower prices by varying amounts, perhaps nearly 10 percent in the long run.

"Respected Massachusetts Institute of Technology economist Jerry Hausman argues that consumer welfare gains are even larger than those estimated by Mr. Basker, probably in excess of 20 percent of sales."

Here's some more good news: Vedder and O'Keefe have a book forthcoming from AEI, titled The Wal-Mart Revolution: How Big Box Stores Benefit Consumers, Workers, and the Economy.

Posted by Mike DeBow at 12:04 PM in Politics

The statesman who should attempt to direct private people in what manner they ought to employ their capitals would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted, not only to no single person, but to no council or senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it. -Adam Smith

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