Thursday, March 27, 2008

A 2008 Nobel Peace Prize For WalMart?

There's a strong case to be made:

  • Provides employment to 1.9 million people; the best defence against poverty is a job.
  • Creates thousands of job opportunities for people in developing countries like China and India; this keeps hunger at bay in many households.
  • Doles out hundreds of millions of dollars each year in dividends that help fund the retirement of millions of people; the company had sales in excess of $348 billion and a net profit of $11.3 billion in 2007.
  • Sells food, clothing and other necessities to Canadians, Americans and others at prices that are 15 to 25 per cent below what other supermarkets charge; this helps millions of low-income families stretch their dollars.
  • Pushes the inflation rate down and helps keep interest rates low; this comes in handy for millions of families when borrowing to buy a house or household appliances.
  • Disburses $415 million in cash and in-kind merchandise annually to 100,000 charitable organizations around the world.
  • Pursues environmental sustainability; sells more organic produce than most retailers; works with the Clinton Foundation to lower prices on sustainable technologies such as energy-efficient lighting and building materials; has opened the first in a series of high-efficiency stores that will use 20 per cent less energy than a typical Wal-Mart. And its proposed Vancouver store is more environmentally friendly than any building in the Lower Mainland.

On the basis of the evidence, it is impossible to argue that Yunus or Carter have done more than Wal-Mart to alleviate poverty.

Sounds like a good candidate to me!

(HT Carpe Diem)


DMCFEE said...

Interesting post, and perhaps counterintuitive.

I was disagree on many fronts here.

1. although Walmart provides jobs, what type of jobs (e.g, check out the statistics on Walmarts reputation about keeping employees part-time to avoid benefits, health-care coverage, etc.)

2. environmental sustainability is a relatively new concept to Walmart. Walmart utilizes the "consumption-discard" model rather than a necessary "consumption-reuse-recycle" model that is necessary for any serious environmental sustainability.

Until these two factors are examined, I could not agree with this assessment.

Ali Hasanain said...

Most of the points listed in favor ignore opportunity cost: if Wal-Mart didn't employ 1.9 Million people, would they be unemployed? Would the capital stock lay idle?

Only point 3 is partially correct, but even there, there is a difference between Wal-Mart and the next lowest cost producers, and Wal-Mart and the firms that would have existed using the same resources had Wal-Mart not existed.

El Palo said...

What about all the Mom and Pop shops that go out of business every time a new walmart opens? These type of big corporations tend to bring a lot of disadvantages along with their benefits.

thinking said...

As reported on outlets such as MSNBC and CNN, WalMart is currently suing a brain damaged woman in a nursing home for all of her money.

Seems this lady was a WalMart employee and was hit by a truck. Walmart paid about $470,000 in medical expenses per their medical insurance.

The family sued the trucking company and won a judgement from the trucking company to pay for her long term care. After legal fees, this amounted to about $417,000 which was placed in a trust.

Seems there's a clause in the medical plan that allows WalMart to recoup medical expenses if an employee collects damages in a lawsuit. So of course WalMart in all of its big heart is suing this lady and her family for her every last dime. What they will do to pay for her long term care is obviously of no concern to WalMart.

WalMart does indeed do some good, but their management style is ruthless. Since Sam Walton passed away, the company has lost its humanity. Their CEO is recognized by many experts to be one of the very worst.

WalMart has at best a very mixed record, but as Ali points out, we don't know what the benefits would be if WalMart did not exist.

And I certainly would not be in any hurry to bestow any humanitarian awards on the company.