Democracy Gone Astray

Democracy, being a human construct, needs to be thought of as directionality rather than an object. As such, to understand it requires not so much a description of existing structures and/or other related phenomena but a declaration of intentionality.
This blog aims at creating labeled lists of published infringements of such intentionality, of points in time where democracy strays from its intended directionality. In addition to outright infringements, this blog also collects important contemporary information and/or discussions that impact our socio-political landscape.

All the posts here were published in the electronic media – main-stream as well as fringe, and maintain links to the original texts.

[NOTE: Due to changes I haven't caught on time in the blogging software, all of the 'Original Article' links were nullified between September 11, 2012 and December 11, 2012. My apologies.]

Tuesday, December 03, 2013

Black Friday and the Race to the Bottom

Black Friday began on Thanksgiving Thursday this year, and continued into Shopaholic Saturday and Sunday. With discounts of up to forty per cent, there were the usual mob scenes at Walmart and Target, the usual brawls over TVs and towels, the usual shoppers with phone cameras immediately uploading footage of the mayhem to YouTube, the usual millions of views within three or four days. It’s becoming an American holiday tradition, a retailers’ Hunger Games.

Unfortunately, it didn’t work. Although a hundred and forty-one million people bought things in stores or online, exceeding the 2012 figure by one per cent, they spent $1.7 billion less than they did last year. Why didn’t the new, extended Black Friday weekend achieve the desired results in consumer dollars? According to the Times, “Walmart and Target both trimmed their yearly forecasts recently, citing economic factors like slow wage growth, unemployment and sliding consumer confidence.” In other words, as Steven Greenhouse reported in a bleak post-Thanksgiving article, too many Americans now work low-paying jobs—for example, stocking inventory and ringing up merchandise in big-box stores like Walmart and Target—to have enough purchasing power to boost sales. Americans are too poor to stimulate economic growth.

One obvious solution is to pay them more—more than the federal minimum wage of $7.25 an hour, more than the eight dollars an hour that a Walmart employee makes in base pay. Henry Ford paid his assembly-line workers five dollars a day, enough to buy a Ford car. Target pays its “associates” enough to buy a sixty-inch flat-screen TV at Target.

Around the country, there are the beginnings of a wage movement. A minimum-wage hike has become law in Massachusetts, and similar efforts are under way in New York and numerous other towns and counties. (In this week’s issue of the magazine, Steve Coll writes about one in Washington State.) President Obama announced his support for a Senate bill that would increase the federal minimum wage to $10.10 over two years. Fast-food workers have been protesting low pay for months, and they plan to walk off the job in a hundred cities this coming Thursday, demanding fifteen dollars an hour. On Black Friday, more than a hundred people were arrested outside Walmart stores from coast to coast. This movement is the great social-justice cause of our time.

But who is paying attention? A YouTube clip of the arrests had a hundred and twenty-nine views by midafternoon on Monday. A video of a woman being arrested inside a Walmart during a Black Friday scuffle over heavily discounted twenty-three-inch TVs had more than six million views, along with more than fifteen thousand comments, many of them along the lines of “fighting over piece of shit tv’s ….Only in America.”

You would think that the major American retailers, keenly aware of the problem of “slow wage growth” and still smarting from their lousy Black Friday numbers, would be leading the protests in favor of higher wages. But one place where the new wage movement has made no inroads is Bentonville, Arkansas, where Walmart has its headquarters. Apparently, slow wage growth has nothing to do with Walmart, which is bitterly opposed to any legislation that would require it to pay its workers more. The other major American retailers feel the same way. They argue that higher wages would mean higher prices and fewer employees. Though there is very little evidence to support the notion that minimum-wage increases lead to layoffs and unemployment, and a great deal of evidence to refute it, the retailers are sticking to their story, which is the story of the American economy of the past generation: lower prices and lower wages—a race to the bottom.

During the civil-rights era, some moderate Southern businessmen spoke up in favor of equal opportunity on economic grounds: if department stores and other businesses were desegregated, they would have more customers, and, with expanded access to employment, those customers would have more spending power. This bottom-line thinking allowed the businessmen to land on the right side of history without explicitly identifying with the demands and aspirations of black Southerners.

Similarly, while no big-box executive can risk being seen by shareholders to be openly taking the side of the lowest-paid employees, there is a hardheaded argument to be made for doing so: the company’s revenues depend on higher hourly wages. While no one imagines that Republicans would allow the minimum-wage bill to pass the House of Representatives, corporate executives are paid to be ruthlessly practical. America is still waiting for the first retail C.E.O. to see what’s in front of his nose.

Original Article
Source: newyorker.com
Author: George Packer

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