The Washington Post’s “unalloyed joys of globalization” cheerleader Sebastian Mallaby gives it the old college try with “Progressive Wal-Mart. Really.” but swings and misses early:
There’s a comic side to the anti-Wal-Mart campaign brewing in Maryland and across the country. Only by summoning up the most naive view of corporate behavior can the critics be shocked — shocked! — by the giant retailer’s machinations. Wal-Mart is plotting to contain health costs!
But what Mallaby calls “containing health costs” is Wal-Mart’s campaign to avoid paying its fair share of its workers’ health care costs — instead of fobbing off that expense on the rest of us.
More substantively, Mallaby claims to refute that Wal-Mart is bad for poor Americans by citing studies that Wal-Mart’s low prices dwarf the economic costs of wage suppression — for which he cites Wal-Mart critic and UC Berkeley economist Arindrajit Dube’s estimate of $4.7 billion. Citing a New York University economist — supposedly inoculated from criticism as an ex-advisor of John Kerry — Mallaby asserts that food discounts alone “boosts the welfare of American shoppers by at least $50 billion a year,” and goes for broke claiming that the “savings are possibly five times as much if you count all of Wal-Mart’s products.” Who knows? The savings are possibly 100 times as much, or 1.09 times as much.
Max Sawicky points out that Mallaby has quietly changed the subject with the $50 billion figure to the aggregate price benefits — to poor, rich, and in-between alike. Mallaby later at least acknowledges those silly federal programs for the needy are “better targeted.” And Mallaby himself also acknowledges — well downstream of the original use of the figure — that the $4.7 billion in lost wages are data cherry-picking too: the figure focuses entirely on Wal-Mart, not on its suppliers.
There are similarly disingenuous arguments to come on the issue of Wal-Mart’s parasitism of the public health care system, such as it is:
Moreover, it’s ironic that Wal-Mart’s enemies, who are mainly progressives, should even raise this issue. In the 1990s progressives argued loudly for the reform that allowed poor Americans to keep Medicaid benefits even if they had a job. Now that this policy is helping workers at Wal-Mart, progressives shouldn’t blame the company. Besides, many progressives favor a national health system. In other words, they attack Wal-Mart for having 5 percent of its workers receive health care courtesy of taxpayers when the policy that they support would increase that share to 100 percent.
Of course “progressives” want poor people to have means-tested Medicaid benefits, whether they’re employed or not. That doesn’t mean they want people to be poor the way Wal-Mart’s unionbusting, timeshaving practices guarantee they will be. And it especially doesn’t mean they are compelled to welcome the nation’s largest employer gaming the system to give itself an advantage over “chump” companies that go ahead and pay for more decent health care.
The “national health care” argument, meanwhile, has been made by better (and less disingenuous) critics than Mallaby. To the honest proponents I say, fine, this may all be moot someday when there’s a national health care system in this country. And to Mallaby I say, we can surely count on your vigorous help with that, right? I didn’t think so.
Mallaby’s piece eventually boils down to a profession of his faith, and an appeal to the reader’s avarice:
But globalization and business innovation are nonetheless the engines of progress; and if that sounds too abstract, think of the $200 billion-plus that Wal-Mart consumers gain annually. If critics prevent the firm from opening new branches, they will prevent ordinary families from sharing in those gains. Poor Americans will be chief among the casualties.
Mallaby may have indeed shed some big, wet, crocodile tears at this point. But the rest of his argument makes it clear poor Americans rank somewhere between last and dead last on his list of concerns. The fundamental weakness of the price vs. wage tradeoff is that it’s so easy to see where it leads — both in China and in Wal-Mart-Land: to a kind of new sharecropping, wage slave, company store economic system where workers are too poor to afford anything but lowest prices, and too beaten down to be able to turn down any but the lowest wages and ‘benefits.’ As publius (”Legal Fiction”) pointed out a few weeks ago:
My point, though, is that citing lower prices alone is never sufficient to win the debate. As I said, it’s relevant, but never dispositive. That’s because there is a limit to what we will accept (morally) in exchange for low prices. So, whenever you hear that a practice lowers prices, there is always a necessary follow-up question – At what cost?
For instance, let’s say that China (or Wal-Mart) used slave labor to make its clothes. The clothes would certainly be cheap, but we wouldn’t accept them because the low cost was a direct result of morally reprehensible slavery. In this case, low prices would not justify the practice.
Slavery is of course an extreme example. In reality, questionable employment practices exist along a spectrum. While we can all agree on rejecting low prices caused by slavery, surely that is not the only place to draw the line. For instance, what about low prices caused by child labor? By 7-day, 14-hour workweeks? By practices that release mercury into the ocean? And so on.
Mallaby’s dubious assignment of Casablanca’s “Captain Reynaud” role (“shocked — shocked!”) to Wal-Mart critics seeks to accomplish the dual goal of making critics seem hypocritical and Wal-Mart a comparatively honest, if perhaps rough hewn (“not saints”) practitioner of real world global capitalism.
Let me return the favor: in this little set piece, Mallaby — who, as a guaranteed winner, can afford to be relaxed about the globalization sweepstakes — seems closer to Peter Lorre’s Ugarte, the “gambler” who has, ahem, come into the only pair of tickets out of town. You remember: the one who asks Bogart, “You despise me, don’t you?” To which Bogart replies, “if I gave you any thought I probably would.”
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UPDATE, 12/1: Yglesias disappoints on the subject, Sirota spanks him for it. An earlier Yglesias post shows he’s not altogether off in right field: he seems to wish the debate were about unionizing Wal-Mart per se, which he supports, not about Wal-Mart paying welfare/Medicaid-worthy wages, which he somehow doesn’t see as the flip side of the same point.
