Hewitt ladders have ofers and sales consistently running to ensure you get the best possible value from your ladders investment…

We live in an era where such ignorance is easily eliminated: http://en.wikipedia.org/wiki/Charles_Platt_(science-fiction_author)

The single largest cost factor for retail is the price of goods. The second significant factor is the cost of logistics (warehousing and transportation of those goods). While labor cost are significant you cannot significantly improve the retail cost structure (and thus profitablity) by focusing on this part of the equation. What Sam Walton understood is that by pushing suppliers to lower their cost and thus the price of there products, he could generate larger demand for their products through lower prices at the retail level (assuming the providers agreed to share those cost savings with Sam). He also understood that the more efficient you are at forecasting demand and driving down the cost of logistics you could again realize significant savings. That Sam Walton decided to pass these saving on to his customers thus increasing the likelihood that they would shop at Wal-Mart was the key to their success as a company.

The canard that somehow Wal-Mart can now pay below market wages because of their size is simply another tact by the unions to justify their relentless attack on Wal-Mart in the hope that they will ultimately capitulate to the pressure and surrender to union demands to represent Wal-Mart workers. In a free market, employees can choose where to sale their labor. If other companies (including retailers) choose to pay more than Wal-Mart than they will attract those workers who believe the value of their labor is worth more than Wal-Mart offers. Of course if that were the case than Wal-Mart would face a shortage of workers and would either have to start paying market levels or eventually lose business from customers who cannot be served. That doesn't seem to be happening.

Of course there is the argument that there is now a over supply of labor due to the recession so Wal-Mart can offer lower wages and still have a large pool of available workers. Not knowning Wal-Mart's labor policies just let me speculate that this might be true. But at the same time it would also be true for any other employer who is not constrained by some sort of contractural agreement with their labor. Of course in those instances the employer may not be hiring at all since they would be forced to hire at wages that may well be higher than the market.

Some small businesspersons do attempt to use government power to tilt the playing field in their favor. Others simply take advantage of whatever gifts government provides.

My job as a small businessman was to maximize profits. If local and federal governments were willing to help me do that, then I would certainly consider using their power.

The job of elected representatives of the people should be to maximize the welfare of the people who elect them. When such representatives interfere in markets – by prohibitiing big box retailers or by granting low rate loans to small businesses – they are harming the populace in order to benefit the few.

The bad guys are the elected representatives who refuse to perform the job they were hired to do. The bad guys are not the moms and pops who simply seek profits.

Sir,

Your comment makes the typical denigrating assumption that Wa;mart employees will all be those who used to make higher wages and are now forced to accept lower wages.

The reality is that most of them are people who are either entering the workforce and therefore have no history of wage earning for comparison, are people who were on welfare or some other kind of dependency, or are people who are not qualified and never have been qualified for a higher wage.

Walmart poses a net gain in every respect to the economics of any community.

And, Charles Pratt is exactly correct in dismissing the woes of the mom and pops that are replaced. Walmart started with one small store and competed with Sears, Penny's, et.al., the mom and pops don't want to compete, they want guarantees like any thumbsucking socialist would.

Walmart doesn't "drive down" wages.

The most important factor determining wages is productivity.

By driving down prices, people are able to have a higher standard of living. Many people will also have more money to spend on other things or to invest.

The economy doesn't work the way you seem to think it does.

That is such a great point, and one that never seems to be made in this context. Bravo!

Unions are all about increasing wages without increasing skills and productivity.

Well said – that's been one of my biggest beefs with unions for many years. If unions consistently improved the skills of their members they'd be worth the high pay levels they demand and wouldn't need laws to maintain their existence.

Perhaps unions in right-to-work states are closer to this, but those states seem to have lots fewer union workers. Coincidence?

Free markets are in itself no moral tools or even policies. They don't enforce any rights by themselves. Only the people living in the market enforce by their choice those rights. So, you shouldn't blame the organization, but rather people in it and its social norms.

However, that's why classical liberalism separates the market and the rule of law to show that the latter is important for a socially free market.

Wrong. The fact that union workers almost always have skills does not prove that they grasp the relationship between skills and wages.

Unions are all about increasing wages without increasing skills and productivity. Honestly, Martin, by what merit does mere seniority warrant higher wages???

Posted by: sethstorm | May 13, 2009 4:15:48 AM"

This must be STrUmPiT, commenting under a different name. If not, they definitely learned their style at the same communist knee.

Muirgeo confuses economic choice with a politcal system. While there may be shared themes between a political system that promotes individual liberty and an economic system that basis it foundations on individual choice – they are not the same thing. That said – the economics of choice can only excel within a political system that fully protects private property and promotes individual liberty. The dilemma that Muirgeo raises is only in his confusion of which system he is actually writing about (political vs. economic). For the economics of choice there is no dilemma – you are chosing to maximize your self interest which in this case may be lower prices. However in the economics of choice you can also maximize your self interest by not buying items produced by a totalitarian state (being that your self interest of political systems is of higher value than the cost of the goods you wish to consume).

As to the underlying point of Russ's article we cannot ignore the political side of this debate. The elitist contempt for Wal-Mart and its partons has nothing to do with the economic value that Wal-Mart has produced. It is simply a political issue. The unions view Wal-Mart as a threat to their existence. Ever since Wal-Mart expanded its retail footprint by moving into groceries they have been a threat to the established unions in that retail segment. Where Wal-Mart has openned a super center – it has successfully competed against (including driving out) the higher cost and inefficient competitors who for the most part has unionized labor forces. In addition, the unions have been repeatedly unsuccessful in their attempts to organize Wal-Mart. Thus in their inability and unwillingness to adapt to the new realities in their marketplace, the unions have once again exercised their political clout to demonize Wal-Mart and use government power to restrict Wal-Mart's growth and preserve the unions economic power. This is also a losing strategy because the masses understand the value that Wal-Mart brings to them and they are not willing to support local governmental restrictions that deny them this economic benefit.

One store doesn't make it a point to have a jet ready to go that would send lawyer-grade thugs at that store.

That same store didn't decide to pull a Benedict Arnold in the 90's when management changed. Sam didnt attract as much attention as his turncoat offspring. When they decide to abandon the Far East in favor of the US again, they might regain a certain sense of humanity that they've lost by becoming an extension of the PRC.