Monday, January 24, 2011

Whither Walmart

In Sunday's Union-Tribune, Erik Bruvold makes the case for Walmart, or perhaps more precisely, the case against a San Diego city ordinance many feel unfairly targets supercenters like Walmart.

A petition drive has been mounted which, if successful, the city council will have 10 days to rescind the ordinance or San Diego voters will decide its fate at the ballot box.

Ironically, the businesses and their employee unions that have pushed hardest for the big-box ordinance, the traditional grocers such as Albertsons, Ralphs, Stater Brothers and Vons, are themselves strongly focused on innovation and change. Supporters of the ordinance conveniently forget that as these grocers have increased the volume of sales from alcohol, baked goods and prepared foods. This has threatened certain wine merchants, bakeries and restaurants. Maybe in the spirit of the big-box ordinance the San Diego City Council could next try to prohibit the grocers from further disruptive innovations. After that, the council could take up the concerns of buggy whip makers over these new contraptions called automobiles.

Seventy years ago, Joseph Schumpeter popularized the idea that capitalism involves creative destruction as firms rise and fall, innovate or die. No doubt the marketplace can be scary. Small-business owners put their heart, soul and dreams into their stores. Consumers who are here today may be gone tomorrow. Preferences change and new competitors enter the marketplace.

The pro-ordinance argument can be found here.

The Liberator Today is all over this as well, countering the pro-ordinance argument found at the link above:

Here is the core of her argument, Superstores have unknown and potentially economic impact, so they should be required to submit to a special analysis before being approved. News flash, all new businesses have an unknown economic impact. If they didn't then the central planning of the former Soviet Union would have made it the richest nation on the planet. Further, even if an analysis is performed, it is unlikely to predict the true effects of any new business. After scaremongering and passing along numerous lies regarding Walmart, she accuses the business of "bullying" the City Council with its petition drive. Bullying? Really? Exercising constitutional rights when being subjugated by local government is bullying?

Requiring businesses to assess their economic impact on the businesses around them is an exercise in absurdity and paperwork (though the two are not mutually exclusive). This ordinance appears to be nothing more than a disincentive to entities such as Walmart that provide good jobs and quality products at low prices.


Full Metal Patriot said...

I disagree with those who argue against Walmart for being a capitalist behemoth. I don't begrudge them success. But I did reduce my patronage of their business after they changed focus from "Made In The USA" to low prices by any means. I'd rather not contribute to China's economy if I can help it (Walmart annually imports between $15-$30 billion in Chinese goods).

It's no surprise that anti-capitalists in San Diego want to enforce "social justice" through punitive ordinances.

Dean said...

FMP, that's the beauty of it. If left alone, businesses will succeed or fail based on the free will of its patrons.

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