Newsletter No. 26
JANUARY 2005
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Wal-Mart a model of 21st Century capitalism? Wal-Mart, with an annual turnover of $260 billion and 1.4 million employees, just in the United States, is the world’s highest grossing firm, the largest employer and largest retailer. This viciously anti-union, low-wage employer accounts for a tenth of all US imports from China and is its eighth biggest trading partner. Wal-Mart has been labelled a ‘template of 21st century capitalism’ a firm that others copy because it has put in place, and perfected ‘the most profitable relationship between the technology of production, the organisation of work and the new shape of the market’. But it ‘increasingly resembles a capitalism of 100 years ago. It combines an extremely dynamic use of technology with a very ruthless and authoritarian managerial culture’ (‘Wal-Mart, a nation unto itself’ New York Times 17.4.04). Wal-Mart directly employs 19,000 workers in 35 stores in China. None are in trade unions. It has effectively resisted unionization in the USA, forced competing retailers to push wages and conditions down and forced supplier companies to relocate to low-wage countries to compete for orders. Its stores have bankrupted local shopping centres and communities and its wages are so low that many also collect welfare, effectively a subsidy for Wal-Mart. Wal-Mart’s concentration of buying power means it ‘simply blasts even the biggest Chinese factory out of the bargaining ring’. To get a contract, supplier firms usually set up in ‘special’ economic zones and reduce their workers, mainly women, to near slavery, working them up to 80 hours a week on low wages, with no overtime rates and in violation of the badly monitored Chinese labour laws. Wal-Mart has not got away with these tactics in the European Union, where labor laws have enabled unions to gain a foothold. The US and Canadian labour movements are also starting to gun for Wal-Mart. This global giant is ripe for international action! |