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April 22, 2017 at 10:43 am

Atlantic Quotes Vedder | How to Think About Walmart

The Atlantic quoted Dr. Richard Vedder, Distinguished Professor of Economics Emeritus at Ohio University and Director of the Center for College Affordability and Productivity, in an article headlined “How to Think About Walmart: Last week, four economics experts publicly debated whether the retailer represents the best capitalism has to offer, or the worst.”

In recent decades, Walmart has come to represent the epitome of capitalist success: The company’s founder, Sam Walton of Oklahoma, was a self-made billionaire and a retail pioneer who built his business on rock-bottom prices.

But for many of Walmart’s workers, the company illuminates the darker side of capitalism: The company does nearly $500 billion in worldwide sales each year, but its low prices are made possible by cheap, overseas production and hourly workers’ paltry pay. Walmart is the largest private employer in the U.S. About 1.5 million Americans work for the company, which is equivalent to roughly 1 percent of the U.S. workforce. In fact, the only larger American employer is the federal government. But while Walmart provides plenty of jobs, it squeezes both its employees and suppliers to the extremes.

While the company’s economic impact is historic and undeniable, a recent debate, put on by Intelligence Squared U.S. in New York, asked whether Walmart’s existence is something that leaves Americans better off. John Tierney, a contributing editor of City Journal, and Richard Vedder, an economist at Ohio University who wrote 2006’s The Wal-Mart Revolution: How Big-Box Stores Benefit Consumers, Workers, and the Economy, argued in favor of the retailer. Making the case against Walmart were Nelson Lichtenstein, a history professor at the University of California, Santa Barbara, and Amy Traub, from Demos, a left-leaning research and advocacy group.*

The pro-Walmart team’s argument was that by offering low prices, Walmart is helping poorer Americans purchase food and other household goods at a big discount—in a way, they said, Walmart is a sort of private anti-poverty program. They argued that the public disdain for Walmart largely comes from people who don’t shop there. Vedder quoted a report by Jason Furman, a former chair of the White House Council of Economic Advisors, which showed the cost-savings of Walmart for Americans to be in the billions of dollars.

Vedder didn’t seem to hold Walmart responsible for the economic situation its workers faced. Rather, he argued that it’s just economic reality: “Not everybody is going to be in the middle class. Not everyone has the skill sets to do this … Are there some people in poverty because of low wages? Yes. Will there always be? Yes. In every society, there’s going to be some people making more than others. It’s naive to say, ‘Let’s pay the low-income people more.’”

Read the rest of the story in the Atlantic.


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