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Dow Jones and the little guy

By Tom Collins
Arizona Daily Wildcat
February 9, 1999
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Arizona Daily Wildcat

There are several retailers my father has declared off limits to the Collins family. The ignoble chains include Sears, Montgomery Wards and a few others. But my father saves his most vehement philosophical oppositions for Wal-Mart.

The international Wal-Mart operation, which serves more than 90 million customers each week, has long been the symbol of the kind of corporate development that local governments seek, but that, in the end, damages local economies and communities.

That, says my father, is reason enough not to shop there - not to mention the rude service and unpleasantly crowded store aisles.

More recently the ranks of such reputedly evil chains have grown to include Borders Books and Music, Starbucks and Home Depot, among others. The U.S. seems more and more to resemble one giant franchise of Los Angeles.

At the same time, as the country's political rhetoric has shifted to the right and as the economic philosophy of the nation falls in step with the drum beat of globalization, the consensus that government regulation of large businesses is good, an idea fundamental to the post-war growth of the nation, has fallen on hard times. These are times of utility deregulation, trade deals, the re-emerging of the largest parts of the Standard Oil trust and (of course) Microsoft.

With each merger or expansion, experts are quick to explain that consumers will benefit from a more competitive company. Service will improve as your prices fall.

While, according to the Small Business Association, businesses with less than 500 employees still account for 99 percent of employers, the remaining one percent employs 48 percent of private employees. This reflects a larger societal economic stress, as wealth continues to concentrate and the middle class shrinks. By 1995, one percent of the U.S. population possessed 33 percent of the nation's wealth, with the richest 20 percent controlling 48.7 percent.

The idea that U.S. consumers and employees will benefit in the long run from huge, yet lean corporations in everything from insurance to hardware retailing seems to fly in the face of logic. Large, publicly owned corporations, like Wal-Mart for example, say that they are capable of and interested in serving three masters at once: stock holders, employees and consumers. Wal-Mart's website goes to great lengths to explain its economic impact. In Arizona, for example, Wal-Mart employs 10,685 "associates" and paid $16.4 million last year in state and local taxes. What Wal-Mart doesn't mention is its intention to build yet another outlet in the still-small town of Gilbert just a few short miles from two other stores constructed in formerly small towns like the now-Los Anglicized Chandler. In essence, that planned expansion, and others like it, from Starbucks down the line, serve one master - the shareholder.

In this new America, we have declared the stock market the crown jewel of our capitalist kingdom. As Dow Jones goes, so go we all. But stockholders don't live in towns. They don't buy books or records. Stockholders don't have to care about the customer, the neighborhood, the community. Their choices are not limited by the whims of marketers who care nothing for the free exchange of ideas and culture. Stockholders aren't trying to raise two kids on $6.25 an hour, aren't struggling to find a job with medical benefits in this service sector economy.