Seth Ackerman, Matt Yglesias, and Doug Henwood had an interesting Twitter conversation earlier this week about boosting wages at Walmart. As Ackerman and Yglesias note, higher pay has to come from somewhere and Walmart, a company whose munificence has always been lacking, wouldn’t bear the full brunt of such an increase: They’d likely pass a portion of it on to customers. Walmart has staked its reputation on delivering low prices, however, so they couldn’t substantially hike prices without sullying the company name.
For his part, Henwood contends that the Demos plan—increasing full-time workers’ annual pay to $25,000—”Could stimulate growth and offset redistribution. Relative incomes would change, but absolute could all rise.” Henwood’s economic chops dwarf my own, so I won’t quibble with his assertion. The underlying labor-capital conflict won’t disappear, though, so, absent ever-escalating profits, the pay increases would eventually cut into Walmart’s bottom line. Workers will have to act in concert to get what’s rightfully theirs, especially when profits aren’t bountiful.
What really rankles me is when people assume Walmart would bestow benefits on their workforce if they could. A perplexed Peter Suderman asks, “Paying Walmart’s workers more would mean the money has to come from somewhere. But where?” Megan McArdle runs the numbers and finds this (h/t Matt Yglesias):
Walmart’s $446 billion of revenue last year was eye-popping, but its profit margins are far from fat–between 3% to 3.5%. If they cut that down by a percentage point–about what retailers like Costco and Macy’s have been bringing in–that would give each Walmart employee about $2850 a year.
McArdle pooh-poohs this apparent pittance, but three grand is a substantial sum when you’re living paycheck to paycheck. This is emblematic of McArdle and her ilk, though: unprecedented worker and solidarity actions across the country, and all it elicits is a collective shrug. (A similarly dour Yglesias informed us that the Black Friday actions were woefully inadequate.)
The core issue in this dispute—and, really, nearly every dispute—is power.
McArdle et al. view the struggle between labor and capital as illusory and, thus, are skeptical of workers’ need to act collectively: Walmart will help workers out when they can. They welcome workers who are prostrate in privation because hey, low prices. Agency, dignity, democracy—all meaningless because Walmart sells cheap food, microwaves, and TVs. These inveterate capitalists have weighed the costs and benefits of raising workers’ wages and augmenting worker power, but—surprise!—cheap consumer goods and more neoliberalism are the answer.
If the Black Friday protests weren’t perfect—there will need to be a tactical escalation, more organizing, and, obviously, more striking workers—they were a start and a success. Building power takes time.