Originally Posted By: JHZR2
Point is, mom and pop shop pays themself, a few others... maybe not much better than minimum wage, but they are involved in the local economy, from the rent they pay for their storefront, to the people the employ to the taxes they pay.
In a recession, they may not be doing great, but they may be afloat... until Wal-mart comes in.
So here is Wal-mart, doing great things... creating jobs, hiring 300 people at minimum or near minimum wage. The small shops, already hurt, cannot compete in any way, and close up. 400 net jobs are lost, besides the rent payments and whatnot else... perhaps mom and pop shoose to retire, becoming government recipients instead of paying into the system.
But wal-mart is growing and creating marginal jobs...
well, yahoo. the benefit? swome cost efficiency of widgets... the winners? maybe two store managers and the high ups at corporate. The loosers? All of the local folks who were displaced by wal-mart from their move into town.
And thus, real social costs go up, net jobs are decreased, and net imports from China keep rising.
And then someday China calls us on our debt incurred due to social programs, with thei rising costs in part created by wal-mart, and then the Chinese can nationalize whatever they desire... that will make lots of folks real happy... Im sure.
But it has to come around somehow...
You can look at it that way, or you can look at how our economy really scale up to a "bigger is better" model. I don't see Walmart being any different than Target, Safeway/Albertson/Kroger, Bestbuy, Costco, or any other box stores chain that runs on a large scale and reduce cost and overhead in the mom and pop stores.
Without Walmart, these mom and pop will still go out of businesses if they stay the old fashion way of doing businesses. What Walmart did was using the minimum wage earner to compete with someone that can do the same job more expensively. Will these Walmart workers just stay in unemployment and receive social services on tax payers' dime? or will they be more efficient and make a higher wage if Walmart does not exist? I don't think the mom and pop being displaced are the same people that works for Walmart.
Simply put, there is no way you can displace Walmart. Someone else would have taken its place to drive the mom and pop out of businesses. It is a fact of life, and IMO these mom and pop are better equiped at finding other works (i.e. specialty Internet sales, working for a bigger company, etc) than the people that work minimum wages at Walmart (as they would have been unemployed if the technologies aren't there to make their work more useful). The society as a whole gain more, just that some individual (like the mom and pop here) are no longer able to get rich sitting in a store 12 hours a day as the good old days.
There are still liquor stores and 7-11 around the corners, as well as McDonald's and Subways. If the mom and pop insist, they can still join a fast food franchise, but they probably have to work much harder than before.
