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Eminentoes
Born to Run
In between playing at the Lincoln Memorial for Barack Obama's inaugural concert and performing the half-time show last night at the Super Bowl, Bruce Springsteen got caught in a policy controversy over a promotional deal he made. Springsteen had inked an agreement for Wal-Mart to exclusively sell and promote his new album, Working on a Dream. This made good business sense, given that a similar arrangement last year with Wal-Mart and hard rock bank AC/DC led to a surprise chart-topping album.
But the very mention of the name of Wal-Mart still raises the hackles of some activists on the Left, particularly those affiliated with Big Labor. They called on Springsteen to renounce the deal, and he caved, telling the New York Times, "we dropped the ball." Springsteen said that "given its labor history, it was something that if we'd thought about it a little longer, we'd have done something different."
But a major player on the economic team of Obama, for whom Springsteen campaigned so strongly on behalf of, disagrees strongly with Springsteen and the activists on Wal-Mart's "labor history." Jason Furman was a top economist on the Obama campaign, and President Obama recently named him deputy director of the National Economic Council at the White House. He is pushing strongly for the stimulus bill and other liberal fiscal priorities of the administration.
Yet when it comes to Wal-Mart, Furman doesn't view it to be the threat to workers that many other liberals do. In fact, he has found it to have greatly improved the lives of the poor and working class Americans. In a 2005 paper entitled "Wal-Mart: A Progressive Success Story," which he wrote as a visiting scholar at New York University's Wagner Graduate School of Public Service, Furman concludes, "By acting in the interests of its shareholders, Wal-Mart has innovated and expanded competition, resulting in huge benefits for the American middle class and even proportionately larger benefits for moderate-income Americans."
Furman finds that even if Wal-Mart's had lowered wages for the retail sector -- "and the evidence for this is far from -- clear," he notes -- "the magnitude of any potential harm is small in comparison" to the savings gain to workers as consumers from Wal-Mart lowering of prices of products. "Plausible estimates of the magnitude of the savings from Wal-Mart are enormous -- a total of $263 billion in 2004, or $2,329 per household."
Furman further dispels myths about Wal-Mart on wages, benefits, and health care. "Wal-Mart workers, like other workers in the retail sector, are paid less than the economywide average wage," he writes, and its "health benefits are similar to or better than benefits at comparable employers."
He also invalidates comparisons to higher-end warehouse clubs like Costco, noting that "as a result of higher margin goods and larger volumes, sales per employee are considerably larger at Costco.… Telling Wal-Mart to ape Costco's wages is like telling Best Buy to pay its employees as much as the high-end boutique plasma television dealer across the street." Similar points about Wal-Mart's wages and benefits were made in a Competitive Enterprise Institute study by our adjunct scholar Zachary Courser.
But lest anyone accuse Furman of taking the libertarian line in his paper, he also fills the study with liberal policy ideas that he argues will improve the lives of Wal-Mart employees and other workers. These include expansion of the Earned Income Tax Credit and Medicaid, things that the Obama administration and congressional Democrats are fighting for in the stimulus. He even calls for Wal-Mart to join in the fight to "push to expand these public programs."
Whatever the merits of these "progressive" ideas (and you can find plenty on them, as well as alternative free-market health care solutions, on CEI's blog site OpenMarket.org), Furman is right to call for systemic public policy changes to improve workers lives rather than destructive attempts to force an individual business to change it wage structure.
One beneficial public policy change Furman could push for in the Obama administration is reversal of the Bush's administration's deeply flawed moratorium on retailers like Wal-Mart starting their own limited banking operations. If the government can promote a General Motors subsidiary to a bank holding company by virtues of its failure, then businesses like Wal-Mart not applying for bailouts should not be held back because of their success. Letting Wal-Mart and other firms expand into banking could expand the supply of credit and lead to reduced costs and more benefits for consumers on their savings and checking accounts.
As Americans are tightening their belts and looking for bargains, more are finding attractive the discounts at Wal-Mart and other "big box" stores. Bruce Springsteen sings about the working class, but it's been a long time since he's been one of its members. He may want to get back to his roots by visiting a Wal-Mart, or at least taking these words from Furman's study to heart: "To the degree the anti-Wal-Mart campaign slows or halts the spread of Wal-Mart to new areas, it will lead to higher prices that disproportionately harm lower-income families."
While President Obama can respect Springsteen as a fine musician, as many other Americans do, he should recognize that when it comes to public policy relating to Wal-Mart and workers, Jason Furman is the true "Boss."
(Full disclosure: Like millions of other Americans, I shop at Wal-Mart, and I also own shares of stock in the company. I have never hesitated, however, to criticize Wal-Mart when I thought the company was in error, such as on its misguided "green" initiatives.)
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Appleby| 2.3.09 @ 6:53AM
The reason Liberals really hate Wal-Mart is that the whole Liberal mantra rests on a poor and downtrodden *lumpenproletariat.* Wal-Mart makes a whopping profit LIFTING UP the downtrodden masses, allowing them to make their homes comfortable and dress their children and feed them for the money they have to spend, without having to go to the Goodwill and the Salvation Army.
How can the Liberals lead the revolution to overthrow the evil capitalists if the Proles are NOT poor and downtrodden to the point that they hate the people who have comfortable homes and nice clothes and good food?
In fact, the Liberals despise the lumpenproles and Wal-Mart because it allows them to, as the British would say, ape their Betters. The whole identity of the apparatchik is tied up in their having things better than the lumpenproles whose ranks they have climed above. If the underclass has what they have, even if it is a made in China copy, where is their advantage?
If anybody could still read or had a classical education, it would be easy to see this and point it out to make the apparatchiks look as ridiculous as they are.
Rocco| 2.3.09 @ 7:05AM
Appleby, as you may be well aware, we are reaping the results of a government-run education system that basically has the blind leading the blind, and has so dumbed down our population so that few people are capable of critical thinking - a result of the classical education which you cite. Another few generations of this, and the majority of the population will be no better than the medieval serfs during feudalism.
Rocco| 2.3.09 @ 7:07AM
BTW, Springsteen is a has-been. In fact I didn't like him when he started, and I don't like him now. During the Superbowl, I muted the TV and prepared my dinner during his show. Now, I do like his E St band, but just don't care for him and his tunes. Another attempt by aging boomers to regain their miserable youth.
Curly Smith| 2.3.09 @ 8:46AM
I have to disagree slightly with Appleby. The reason the Libs hate Wal-Mart is because Wal-Mart has done more to uplift the lumpenproles than all of the measures funded by the massive wealth transfer of "The Great Society". The Libs *talk* about helping the poor live better lives, Wal-Mart actually makes their lives better. Of course as Appleby says, if the Proles aren't poor and downtrodden then what's the point of the Liberal anti-capitalist screed? So, Wal-Mart demonstrates the falsity of Liberalism, if the Liberals *really* cared then they'd work to bring Wal-Marts to more neighborhoods instead of being obstacles in the path of progress. It's telling that the "Progressives" are so anti-progress.
Robert Rosencrans| 2.3.09 @ 9:12AM
Bruce Springsteen stated the Wal-Mart deal was a mistake. It should also be noted he didn't pull out of it. Bruce Springsteen is another money grubbing hypocritical liberal who panders to the morons who follow him and believe in him as a political force.
By the way, Google Bruce Springsteen and Wal-Mart and the first thing that pops up is the Wal-Mart web site selling Bruce Springsteen.
Larry| 2.3.09 @ 9:16AM
B.S. was hoping few would notice his good business sense. Walmart gives the "artists" a bigger chunk of money for exclusive sales compared to any open marketing. My guess is that B.S. won't call on fans to boycott the new album.
Doctor Right| 2.3.09 @ 9:24AM
Let me chime in with my two-cents about why Liberals really hate WalMart.
The first is practical. WalMart makes BILLIONS of dollars, and since Liberals have institutionalized stealing, they want to get their hands on it...But they can't, because WalMart's employees consistently reject calls to unionize. Therefore, in the spirit of Saul Alinsky, Walmart must be demonized until they cave, or they must be destroyed.
The second reason that Liberals hate WalMart is cultural. To Liberals, nothing epitomizes middle-American, bourgeois values more than WalMart, INCLUDING the people who shop there. These people, these unfashionable, bargain-seeking masses, who prop-up the wasteful, environmentally unfriendly consumer society by purchasing copious amounts of goods are an embarrassment to Liberals. Libs love to talk about "the people", and how their policies support "the people", but in reality, they have nothing but contempt for "the people", and the way that "the people" think, buy, worship, and especially, how they vote.
To a Liberal, WalMart is the embodyment of all that they can't stand about America, and "the people". Never mind that these same people, the WalMart shoppers, are what makes this country run. Their existence makes the Libs uncomfortable...It reminds them that beyond the shores of Manhattan, Malibu, and San Francisco, there's an entire world of people that they can't (yet) control, and that, to them, is a very unsettling thought.
Mike M| 2.3.09 @ 9:38AM
"The Boss," as he is so glowingly referred to, has been nothing but an ultra liberal from his early days. I, having the misfortune of living in New Jersey, was subjest to the daily rantings about Springsteen's greatness. I never liked the guy, or his noise. Having seen the Rumson mansion he lives in, one can only see the similarities he has with our "Messiah president," namely, that they both never worked a day in their lives. Some boss.
daddio| 2.3.09 @ 10:30AM
I used to like Springsteen in my youth. But as I age, I increasingly respond to him and his ilk with "Shut Up and Sing".
Dustoff| 2.3.09 @ 10:32AM
BS is so yesterdays news.
Dwight Thorne| 2.3.09 @ 11:11AM
Strive for Wall Mart quality government, get what you paid for - cheap institutions that destablise the country: SEC failed in sctutinising the proper financial disclosures, rating agencies failed in proper risk rating... now let the banks fail in keeping citizens' deposits. Paying only FDIC guaranteed minimums - that's no frills Wall Mart spirit!
moron| 2.3.09 @ 11:21AM
As usual, the liberals simply serve as useful idiots. Most of their "concerns" are bankrolled bu unions!! Why? Unions are missing out on a potention $500,000,000 if only Wal-Mart were unionized. Man, it would be nice if the union guys had a few more private jets and country clubs to spend Wal-Mart union dues on.
Doctor Right| 2.3.09 @ 11:49AM
To: Dwight Thorne
Re: What the hell are you talking about???
You're obviously unfamiliar with:
a) WalMart as a company, and...
b) The quality of the Federal Government that we DO have.
WalMart is a highly successful compnay that earns BILLIONS by providing their customers with what they want - high quality duarable goods at affordable prices.
In other words, the way that WalMart does business is anathema to the way that the incompetent, lying thieves in Washington "do business".
I'll take a "WalMart quality government" any day over what we have now. In fact, if the Walton family controlled the federal budget thet way they controlled Walmart's we'd be in the black, and probably paying very little in taxes.
Please...Get a clue.
Alan Brooks| 2.3.09 @ 3:29PM
actually, future people (and cyborgs, etc) will be better off than serfs, the because empty brave new world will be comfortable, will offer everything material, but will be cold, and dead-feeling.
the future will opulent but heartless. you can count on it.
Robert Nowall| 2.3.09 @ 3:52PM
I suppose Wal-Mart could take over government functions and keep everybody happy and consuming, until rising toxic levels force them to put the population in space cruise ships while trash-compacting robots clean up the messes...oh, wait a minute, isn't that the backstory for "WALL-E"?
ruth| 2.3.09 @ 7:57PM
Nice try, Dwight; our economic mess is Wal-Mart's fault. Sorry, Charlie, you liberals and your inane social engineering got us into this mess, and we're not going to let you forget it!
S.L. Toddard| 2.3.09 @ 9:37PM
I don't care too much for B.S. but I think he should be remembered as the composer of that fantastic song "Copacabana".
Brilliant piece of music.
Hi Lady Ruth!
S.L. Toddard| 2.3.09 @ 9:56PM
... or was it "Horse with no name"?
Alan Brooks| 2.3.09 @ 9:58PM
no it was 'in the year 2525'
ruth| 2.3.09 @ 11:37PM
You guys crack me up.
Dwight Thorne| 2.4.09 @ 5:10AM
A Substantial Number of Wal-Mart Associates earn far below the poverty line.
Dr. Right - get a clue! Wal-Mart's 2006 Annual Report reported that the company faced 57 wage and hour lawsuits.
The State of Connecticut, investigating Wal-Mart's child labor practices after the federal investigation ended, found 11 violations.
Wal-Mart buys much of its merchandise from China and is responsible for about 1/10th of the U.S. trade deficit with China.
One of every 25 containers shipped to the United States in 2005 was destined for Wal-Mart.
Controversy over the issue of trade with China seems destined to sharpen as America's trade deficit with China rises still further and as more industries are hit by competition from China.
http://walmartwatch.com/blog/archives/wal_marts_latest_import_slave_labor/
If you wish that citizens of this country are treated Wall Mart style as poor working slaves, lacking stable and secure governmental institutions - I think taht you are wrong.
Doctor Right| 2.4.09 @ 10:16AM
To: Dwight Thorne
Re: You're a fool.
Dwight-boy:
WalMart has over 1 million employees worldwide - yes, that's 1 million!!!
And they had "57 wage and hour lawsuits", ehh? 57!?!? WOW!!!!!!! Why, they're just swimming in legal trouble, aren't they???
And the state of Connecticut found 11 violations!!!!! OMG!!!!!! Call the President!
Dwight, you're a union suck-up. Take your lies and your distortions to another website. You obviously have no grasp of statistics or reality for that matter, and you're talking points are a bore.
Additionally, how is it WalMart's fault that "a substantial number of Wal-Mart Associates earn far below the poverty line"??? Seems to me you should be thanking WalMart for giving them much needed jobs, as they were obviously poor before they started working for WalMart.
And where, pray tell, did these statistics come from?? Most likely, like a good union stooge, you're comparing wages earned overseas in the 3rd world with US wages. Oh, I guess you want them to be paid a "living wage", right? Nice try...Here's a clue: In the 3rd world, they are paid a "living wage".
Go back to your scumbag union bosses and tell them you've been exposed for the ignorant fraud you are.
WalMart rules.
You're an ass.
ruth| 2.4.09 @ 3:13PM
Liberal tools see private enterprise as the enemy and the state as their friend. Sounds like Marxism to me. The punitive measures are next because liberals love power and control; just like all tyrants. They are haters.
Hans Aschenbecher| 2.4.09 @ 4:52PM
Wall Mart failed miserably in Germany, and reading the above comments it seems it has a good formula on how to turn normal country into a 3rd world sweat shop. The truth is that in Germany Wall Mart was a dwarf attempting to pick a fight with boys three times it's size like Kaufland and Metro. In China Wall Mart supports Unions, as all Wall Mart China workers are unionized after Wall Mart lost it's battle to prevent it. Wall Mart hardly rules, it only does so in U.S. and Mexico....
Kat| 2.5.09 @ 3:45AM
Wal Mart doesn't need Germany. Who cares? You're socialist stooges anyway. Yeah, I would just love to be a worker in China. That would be wonderful.
Obama Rulz| 2.9.09 @ 12:05PM
Doctor Right licks Wal-Mart's ass like it was an ice-cream cone.
Obama Rules| 2.9.09 @ 12:06PM
ruth, you're an idiot.
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