Harold Meyerson, at the Washington Post, on “Wal-Mart’s strategy of deniability“:
… Over the weekend, a horrific fire swept through a Bangladesh clothing factory, killing more than 100 workers, many of whose bodies were burnt so badly that they could not be identified. In its gruesome particulars — locked doors, no emergency exits, workers leaping to their deaths — the blaze seems a ghastly centennial reenactment of the Triangle Shirtwaist fire of 1911, when 146 workers similarly jumped to their deaths or were incinerated after they found the exit doors were locked.
The signal difference between the two fires is location. The Triangle building was located directly off New York’s Washington Square. Thousands watched the appalling spectacle of young workers leaping to the sidewalks 10 stories down; reporters and photographers were quickly on the scene. It’s not likely, however, that the Bangladesh disaster was witnessed by anyone from either the United States or Europe — the two markets for which the clothes made inside that factory were destined. For that, at least, Wal-Mart should consider itself fortunate….
If this were an isolated incident of Wal-Mart denying responsibility for the conditions under which the people who make and move its products labor, then the Bangladeshi disaster wouldn’t reflect quite so badly on the company. But the very essence of the Wal-Mart system is to employ thousands upon thousands of workers through contractors and subcontractors and sub-subcontractors, who are compelled by Wal-Mart’s market power and its demand for low prices to cut corners and skimp on safety. And because Wal-Mart isn’t the employer of record for these workers, the company can disavow responsibility for their conditions of work…
This system isn’t reserved just for workers in faraway lands: Tens of thousands of American workers labor under similar arrangements….
Other discount retailers — notably Costco and Trader Joe’s — pay their workers far more, train them more extensively, have much lower rates of turnover and much higher rates of sales per employee, according to a Harvard Business Review article by Zeynep Ton of the MIT Sloan School of Management. Costco is a very profitable business, but Wal-Mart maintains an even higher profit margin, which it achieves by underpaying its employees. The conservative economic blogger Megan McArdle estimates that if Wal-Mart held its profit margin down to Costco’s level, its average worker would make about $2,850 more each year — a considerable increase in a sector where workers’ earnings average less than $25,000 a year….
Naturally, McArgleBargle (after saying that “arguably, the higher wages that FDR’s policies pushed for helped prolong the Great Depression”, because that’s another lie the Robber Barons are trying to mainstream) insists that “$2850 a year… is substantial but far from life-changing.” Why, that’s not even two Thermomixes, not that Wal-Mart shoppers should even aspire to own Thermomixes! And after all, “Further wage improvements would have to come out of the pockets of Walmart’s extremely price conscious shoppers”, because reducing the Walton heirs’ multi-billion-dollar profits is literally unthinkable to Megan McArdle!
Somebody’s going to re-write Diderot’s notorious aphorism to reference the last vulture capitalist and the last Kochsucker apologist.