The high cost of cheap prices

All across America, schoolchildren have walked through downtown retail districts several times each year, hitting up business owners for donations supporting school raffles and other fundraising projects. Many of those small business owners have cheerfully donated merchandise, services, even cash, time after time, year after year — even when money was tight. McMinnville businesses have been enthusiastic supporters of student fundraisers and community events for as long as anyone can remember.

But like a simple internet meme recently pointed out, now it’s payback time. Those small businesses that have survived the economic ravages of COVID need your support desperately. Mind you, they’re not asking for free money or donations like those they give students, they just want you to come in as customers. They want you to consider the small mom-and-pop storefronts that make up the vibrant color of Third Street and streets all across town. They want you to remember that the big box stores and corporate retailers do not contribute in any way to creating and maintaining a town’s personality.

McMinnville has tons of colorful personality. These small shops owned by local people — our friends and neighbors — contribute abundantly to everything making this town special. People come to McMinnville to walk up and down Third Street, sipping wine, browsing windows, enjoying lunch, making purchases. No one comes to McMinnville to shop at Walmart. And Walmart has never contributed in any way to our town’s quaint and welcoming vibe.

But Walmart isn’t a neutral presence in our community, far from it. We already know the giant retailer contributes nothing to the special flavor of our small city, yet that’s not where the story ends. While Walmart rakes in the cash, it also actively and intentionally costs the communities it serves in ways many people do not consider.

In the fiscal year ending January 31, 2020, Walmart’s total revenue was $524 billion. In 2009, Walmart claimed over half of its 1.5 million U.S. employees received health care benefits through the company. But since then, Walmart has declined to disclose coverage rates and has taken steps to reduce coverage for associates. In 2014, the company eliminated coverage for part-time employees.

Most people agree the U.S. health care system is badly broken — I am one. I dislike the concept of employer-provided health care but it has been implemented elsewhere with great success. Germany, in fact, has a popular and effective employer/employee-funded universal multi-payer health care system with roots in the 1700s. The program provides health care and a safety net for everyone, allowing those who desire more coverage to also purchase private insurance. But back in the 2020 U.S., I do not want a struggling business owner to decide what coverage I get, effectively allowing him to oversee my health care.

I understand it costs Walmart a bundle to provide health insurance. But when you rake in $524 billion, you have an obligation to minimally care for the people who enabled you to do that. Not only does Walmart fail to properly compensate its associates, the behemoth company intentionally uses public social services to ensure its employees can live, eat and be healthy. Think about it this way: in effect, the wealthiest corporation in the world uses the nation’s overstretched emergency rooms as its de facto free employee health care program. In 2014, Forbes reported Walmart cost U.S. taxpayers $6.2 billion “…in public assistance including food stamps, Medicaid and subsidized housing…” Worse, the magazine reported “…a single Walmart Supercenter cost taxpayers between $904,542 and $1.75 million per year, or between $3,015 and $5,815 on average for each of 300 workers.” Did you read that? Up to $1.75 million per year for one store in one community! This is outrageous! Even if we assume the least cost and adjust for the lack of the word “super” on the McMinnville store, this giant money-gobbler is leeching off our community to the tune of hundreds of thousands of dollars each year.

With Walmart’s revenue, influence and some creative planning, the company could create a national health insurance plan covering all its U.S. employees. For that matter, the company is large enough it could create its own health network for routine and non-hospital care for its employees, effectively building a nationwide network of (store-based?) health clinics and urgent care centers for its workforce. Heck, the company has already been talking about offering Walmart-style for-profit health care to the world. Why not start with taking care of its employees? Would it cost the company? Sure, but it beats having a hulking monster with low prices inhaling money at an unbelievable rate while it simultaneously uses Willamette Valley Medical Center’s emergency room to provide free health care for local employees.

And the company would still earn a staggering amount of money.

Walmart occasionally engages in virtue signaling, where it promotes the heck out of a singular good deed the company did. It returned $12.6 million in COVID stimulus money in April, pledging not to accept any further aid. While it promoted the hell out of that reimbursement, it never should have received the money in the first place. The company also likes to highlight bonuses it paid to associates in November — but while the total paid out sounds impressive, associates received less than $500 each, an amount substantially less than I paid for one month of private health insurance.

When money is tight, it is tempting to shop at Walmart. When you know you can get whatever you need for half the price it is elsewhere, the temptation can be overwhelming. We owe it to our families to be good stewards of a tight budget. But in a larger sense — even a moral sense — if we love our community and value its special warmth, its quirky people, its quaint shops and excellent restaurants, we have an obligation to support them instead of enabling a giant bloodsucker to feed off of us. And if we want to talk morals, we can acknowledge Walmart owes its stockholders a fair return on their investments — but not on the backs of the associates who make it all possible and who will never own Walmart shares.

If you amble down Third Street on a chill December evening, not one of the merchants you encounter is responsible for bilking this community because it’s too cheap to pay its employees. Not one is raking in gold at a rate almost incomprehensible to the average American — on the contrary some are barely surviving because of monsters like Walmart. Not one specializes in cheap Chinese merchandise obtained under wholesale purchase agreements even other retail giants can’t match.

Will you pay a little more? Maybe. But the shopkeeper will know your name and maybe even those of your children. The clerk at the counter will remember you from the last time you came in. You’ll never have to spend 20 minutes looking for a sales associate to help you — and you’ll never encounter an associate who can’t provide an answer to your question. The few extra dollars you spend will be worth the down-home personal service you’ll experience. Even better, you’ll be contributing to helping this community thrive in times of retail peril — not helping engorge an obscenely rich family in Arkansas who is too cheap or too greedy to take care of the people who worked to give them that privilege.

Now more than ever, shop local.


(Sources provided in comments.)

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