In a previous posting on the FFF site, I argued that the campaign of demonization
against Wal-Mart was silly. As expected, a number of
people emailed me to tell me off. I think its worth
another posting to examine the antiWal-Mart
arguments made by those writers.
Wal-Mart kills small business.
This argument tends to get
personal. One writer informed me that
Wal-Mart was responsible for the bankruptcy of his
fathers business.
All right lets make the assumption that if
Wal-Mart had not chosen to locate in the area served by
that business, it would still be going strong, its owner
making profits, and its workers still employed there.
There may, of course, have been other causes of this
business failure, but for the sake of argument, assume
that Wal-Mart is solely responsible. Should Wal-Mart have
been prevented from opening a store there?
If we say so, that would mean that the party who sold
Wal-Mart the land would have been prevented from making
that transaction; the contractors who built the facility
would not have benefited from the building contracts they
entered into; the construction workers would have had
less work to do (or at least, less-remunerative work);
and the employees who took jobs with that Wal-Mart store
would have had to choose among fewer job opportunities.
Vetoing one Wal-Mart store clearly kills off a lot of
voluntary trade that people would like to engage in. Some
people, however, think its worth it in order to
save existing businesses.
But we cant stop with Wal-Mart if we want to save
existing businesses. If we are serious about saving
quaint establishments from the ravages of competition, we
would have to prevent the entrance of any new firms, and
also of new forms of competition. When people buy books
at a new Borders, that might put the local mom and
pop bookstore out of business; when they buy
clothing on-line, that might be the fatal blow to an
old-fashioned clothing store. Id bet that even the most
vociferous Wal-Mart opponent has patronized such
competitors of the mom and pop stores.
If we took seriously the argument that new competitors
shouldnt be allowed because they might harm
existing businesses, we would have to outlaw competition
itself. That would be a terrible policy, one that even
the Wal-Mart haters would not like.
Wal-Mart is anti-union.
One writer pointed out that
Wal-Mart opposes unionization of its workers and that
Hitler and the Nazi Party destroyed labor unions. In the
minds of some people, the fact that a business prefers to
operate in a union-free environment is tantamount to
Nazism, but it isnt.
Even under our highly authoritarian National Labor
Relations Act, companies are free to discourage their
employees from unionizing. That law makes union
representation a matter of majority vote and compels
companies where a union is officially deemed to have won
a majority to bargain in good faith with the
union representatives. The union becomes the exclusive
representative for all the employees, including those who
did not want it, for an indefinite period of time. While
employer speech and action that is designed to persuade
the employees to vote against unionization are rather
tightly (and in my view unconstitutionally) circumscribed
for example, it is illegal for the firm to promise
workers any benefit if the union is defeated
companies still have some freedom to oppose
union-organizing drives. Wal-Mart is pilloried by union
advocates for choosing to do so.
Its important to note that there are many workers
who do not want union representation. Firms that refuse
to capitulate to union-organizing drives may be thinking
only of their own interests, but at the same time,
theyre protecting the freedom of their workers to
associate (or not) as they choose. That isnt
reprehensible.
But arent unions beneficial to workers? Not always.
Some workers wind up unemployed after union wage demands
lead to lower employment by the company. Furthermore,
union dues negate some of the supposed gain from
unionization, and dues money is often used to support
political candidates and causes that workers abhor. Union
representation isnt necessarily the big benefit
that its often assumed to be. Thats why, when
given the chance, many workers vote against it.
There is a big difference between being
anti-union (like the Nazis) and simply not wanting to
have to deal with them.
Wal-Mart doesnt provide all its employees with
health insurance.
No doubt, that is true, but so
what? Many employers do not provide all of
their workers with health insurance, which requires a
very large deduction from their pay. Any worker who
desires to have an employer-provided health insurance
policy has an easy option here dont work for
Wal-Mart. To the extent that Wal-Mart declines to make
such insurance a part of the compensation offer to
prospective employees, it is merely saying, If you
want employment coupled with health insurance, we are not
the right company for you. There is no harm in
that.
All Wal-Mart or any other employer can do is to make
people offers. Having another offer to choose from,
whether in employment, goods to buy, or anything else,
never makes anyone worse off. If an additional offer is
less attractive than others, the prospective employee
just ignores it. Workers who are already covered under
another family members insurance might find
Wal-Marts deal very attractive. Those who think
employer-provided health insurance to be necessary can
look elsewhere. One writer derided my position as
turn the other cheek libertarianism, but one
has to contemplate turning the other cheek only after
receiving an injury. Failure to receive as bountiful an
offer as you think ideal is not an injury.
Thus there is no principled ground for the crusade
against Wal-Mart.
George C. Leef is the director of the Pope Center for Higher Education Policy in Raleigh, North Carolina,
and book review editor of The Freeman magazine.
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