Friday, October 12, 2012

Walmart workers rejecting Walmart's vision of the social contract

Walmart workers in California walked out last week to protest unfair labor practices, and now a nationwide strike is under works.  The company, of course, has no unions.  So how do they strike?  Cautiously, and under justified fears of retaliation:
It was the first-ever employee walk-out in the company’s 50 year history, said Dawn Le, a spokeswoman  for Making Change at Walmart, a coalition whose mission is to change the way Walmart conducts business.
“Everyone else has a union,” said Le. “Workers in every other country — Japan, the U.K., Nicaragua, South Africa, Brazil, Argentina — have been able to form a union, except the U.S. and Canada. We just don’t understand the double standard Walmart has. How come those in other countries get to have a voice, yet not in the U.S., its home country?”
Walmart's answer is that the workers don't want to unionize here:
Walmart spokesman Dan Fogleman disputed Le’s charges, claiming that most employees have “repeatedly rejected unionization. “They seem to recognize that Walmart has some of the best jobs in the retail industry — good pay, affordable benefits and the chance for advancement,” he said in a telephone interview with  ABC News.
 If Joe Biden was there, perhaps he would have laughed at the absurdity and wished that Fogleman "would just tell — be a little more candid."  Matt Stoller reports on the high stakes, not just for Walmart's workforce but for society in America and globally:
Workers at Walmart stores across the country, as Josh Eidelson reports, are threatening to walk out on Black Friday, the biggest shopping day of the year. These labor actions are coming on top of earlier labor actions at Walmart's warehouse contractors linked to "non-payment of overtime, non-payment for all hours worked, and even pay less than the minimum wage."
...Walmart is massive – the company is the largest private employer in the US, with more than 2 million employees. The average American household spends $3500 at Walmart, and in 2006, the company alone represented 2.3% of the American GDP. The company is so powerful that when a Walmart Supercenter comes into your community, the entire community's obesity rate increases. It is also, as  New America scholar Barry Lynn has argued in End of the Linea force that has reshaped the American corporate world.
According to St. Louis Federal Reserve President William Poole... "About 20 percent of their associates are part time and that they are going to be increasing that share to 40 percent so they can staff at peak times and get more productivity out of their workforce."
But the threat of strike could impact this strategy:
Just two months later, Poole offered some very different and shocking news, "My Wal-Mart contact also said that "Wal-Mart is in the process of raising starting wages in about 700 stores. This is the first time in eight years of talking with him that I've heard any comment like that. He said that some of the raises are part of the Wal-Mart, I'll call it "Social/political" agenda because of all the controversy about Wal-Mart." 
... The company, not surprisingly, is ... known for brutal tactics against workers. It is known for retaliating against employers who attempt to organize. Walmart employees often rely on food stamps and Medicaid, because of insufficient wages and lack of adequate health care. In 2005 ... Walmart "observed among their own employees a reduction in health care utilization – that is, fewer doctors' visits – but an increase in emergency room visits. Apparently employees are struggling some to make the co-payments and that kind of thing, again emphasizing the stress that exists in many lower-income households."
That's as it should be, if you're into Romney's current plan for the health of the 47%.

Stoller concludes:
In the 1950s, the so-called "Treaty of Detroit", an agreement between government, business, and labor for ever increasing wages at automakers, set the tone for the next twenty years of political economy. From the 1970s onward, the new social contract was increasingly set, not just by companies like Walmart, but by Walmart itself. As a new social contract, let's call it the "Treaty of Walmart", emerged as a deal cut between the US government, the Chinese government, and global trading corporations, American society began to reflect a race to the bottom. This strike is thus worth watching – if Walmart loses some pricing pressure because of tactics that impact the company's supply chain or ability to sell, we'll be in uncharted territory.
More from Stoller on just how deeply Walmart influences manufacturing practices, retail prices, and wages here, and for an international perspective, take a look at this.  

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