My view

Walmart and Amazon are exploitative and destructive 

There’s an alternative

By SAM PIZZIGATI AND BOB LORD
Posted 12/23/24

Officially, we don’t have royalty in this country. However, we do have “retail kings.” 

Like “Crazy Eddie.” In the 1970s and 1980s, the Crazy Eddie electronics …

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My view

Walmart and Amazon are exploitative and destructive 

There’s an alternative

Posted

Officially, we don’t have royalty in this country. However, we do have “retail kings.” 

Like “Crazy Eddie.” In the 1970s and 1980s, the Crazy Eddie electronics chain stretched from Philadelphia to Boston. Fraudulent business practices eventually landed its founder, Eddie Antar, behind bars.

In the 21st century, only two retail giants genuinely deserve the “retail king” label: Amazon and Walmart.

Together, these two companies rule the retail marketplace. Their combined market capitalization stands at slightly under $2.5 trillion. The combined personal fortunes of Amazon’s Jeff Bezos and Walmart’s Walton clan exceed half a trillion dollars.

Amazon and Walmart credit their status to low prices, convenience and speed. These two 21st-century retail kingdoms, like the medieval fiefdoms of old, rest heavily on exploiting workers. 

A recent report from Oxfam, the global nonprofit working to end inequality, convincingly details this exploitation. 

Oxfam’s report documents worker surveillance at both companies and explores the intimidating workplace cultures the giants foster. Oxfam found that 91 percent of Walmart store workers reported experiencing dehydration over the last three months. Three-fourths of Amazon workers report feeling under pressure to work faster.

The constant management monitoring of workers at Amazon and Walmart has workers feeling constantly “pressured to keep up with inhumane and unsustainable production standards,” Oxfam concluded. Warehouse floors at the two retail kings “have become incubators of injury, sustained by automation, surveillance and workplace cultures of intimidation.”

Not surprisingly, both corporations have done whatever they can get away with to prevent their workers from joining unions. Today, not one of the 2.7 million employees at Amazon and Walmart is working under the protection of a collective bargaining agreement. 

Local communities where these retail kings set up shop are feeling pressure, too. In one stunning documentary, “Walmart: The High Cost of Low Prices,” the filmmaker Robert Greenwald famously showed the devastating effect Walmart outlets can have on local mom-and-pop stores. 

Walmart can have an equally devastating effect on its suppliers. In many cases, Walmart has become the dominant—or only—buyer for many products and services, gaining what economists call “monopsony” power. Walmart can essentially dictate the prices it pays.

Walmart’s “monopsony” pressure, in turn, suppresses wages at these suppliers, as researchers at the Washington Center for Equitable Growth have detailed. One journalist, Stacey Mitchell, has tied this pressure to the declining quality of Levi’s jeans.  Amazon also wields incredible monopsony power. In a 2019 survey, the Institute for Self-Reliance found that three-fourths of independent retailers rank Amazon’s market dominance as a significant threat to their survival. 

The institute adds that product manufacturers, book publishers and other creators are all reeling under that monopsony pressure. With Amazon controlling access to the online market, many retailers think they “have little choice but to sell” on the Amazon platform—where Amazon can also directly compete for customers against them. 

Are we now forever stuck with “retail kings”? Maybe not. Our world sports a significant, modern retail enterprise that is not squeezing workers and shortchanging the providers of products and services. 

That enterprise, the Spain-based Mondragón, has operated as a cooperative since the 1950s and employs 75,000 people in everything from retail to industrial enterprises. 

None of these Mondragón enterprises manufacture billionaires. Top executives at Mondragón all make less than 10 times what the workers they manage make. At Amazon and Walmart, by comparison, CEOs pull down more than 1,000 times what their workers earn.

Mondragón, the world’s most significant worker-owned business, essentially manufactures equality. The part of Spain where Mondragón has the strongest presence, the Basque region, is rated as one of the most egalitarian places on Earth.

Mondragón, the New York Times notes, “may present an alternative model.” The businesses in Mondragón’s network haven’t been engineered “to lavish dividends on shareholders or shower stock options on executives.” These businesses have been engineered to preserve worker well-being.

Years ago, America’s criminal justice system put one of our original retail kings, Crazy Eddie, in jail. Does the behavior of Jeff Bezos and the Walton clan rate as any less reprehensible? We don’t need retail kings. We don’t need kings, period.

Sam Pizzigati is an associate fellow at the Institute for Policy Studies in Washington, D.C., a co-editor of www.Inequality.org and is the author of “The Case for a Maximum Wage.” Bob Lord is a tax policy expert and Institute for Policy Studies associate fellow. They wrote this for www.InsideSources.com.

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